How The ACA Dented The Cost Curve

Performance measurement part I: Foundational knowledge for measure development

As medicine is moving toward performance and outcome-based payment and is transitioning away from productivity-based systems, value is now being appraised in healthcare through "performance measures." Over the past few decades, assessment of clinical performance in health care has been essential in ensuring safe and cost-effective patient care. The Centers for Medicare & Medicaid Services is further driving this change with measurable, outcomes-based national payer incentive payment systems. With the continually evolving requirements in health care reform focused on value-based care, there is a growing concern that clinicians, particularly dermatologists, may not understand the scientific rationale of health care quality measurement. As such, in order to help dermatologists understand the health care measurement science landscape to empower them to engage in the performance measure development and implementation process, the first article in this 2-part continuing medical education series reviews the value equation, historic and evolving policy issues, and the American Academy of Dermatology's approach to performance measurement development to provide the required foundational knowledge for performance measure developers.

Trends in and Factors Contributing to the Slowdown in Medicare Spending Growth, 2007-2018

Importance

After decades of rapid increase, Medicare per-beneficiary spending growth was historically low in the period leading up to the passage of the Affordable Care Act. In the years immediately following the legislation, Medicare expenditure growth slowed even further.

Objective

To evaluate factors contributing to the slowdown in Medicare per-beneficiary spending growth.

Design, Setting, and Participants

In this cross-sectional study, expected spending growth for 2012 to 2015 and 2016 to 2018 was predicted holding payment rates and population characteristics constant. By contrasting predicted and actual spending growth during these periods, the contribution of population vs payment factors to the Medicare spending slowdown was determined. Analyses included all Medicare fee-for-service beneficiaries aged 65 years and older, ranging from 30 to 35 million beneficiaries annually between 2007 and 2018. Data analyses were conducted from January 2018 to August 2018 and updated with new data in June 2021.

Main Outcomes and Measures

The main outcome included annual growth in total per-beneficiary spending. The roles of payment rate changes and differences in the Medicare population over time were considered, including demographic characteristics and numbers of chronic conditions.

Results

Between 2008 to 2011 and 2012 to 2015, the adjusted annual Medicare Parts A and B per-beneficiary spending growth rate declined from 3.3% to -0.1%. From 2016 to 2018, the mean annual Medicare spending growth rate rose relative to the previous period but remained lower than in the baseline period at 1.7% per year. This slowdown extended across all sectors within Parts A and B, except for physician-administered drugs offered under Part B. Changes in payment rates (including sequestration measures) and beneficiary characteristics explained 44% of the difference in overall per-beneficiary spending growth between 2007 to 2011 and 2012 to 2015, and 63% between 2007 to 2011 and 2016 to 2018.

Conclusions and Relevance

In this cross-sectional study of trends in spending growth per Medicare beneficiary aged 65 years or older, results suggested that Medicare payment policy, including sector-specific payment rate changes and sequestration, will be a critical determinant of whether the Medicare spending growth slowdown persists.

The Impact of Narrow and Tiered Networks on Costs, Access, Quality, and Patient Steering: A Systematic Review

Health insurers use narrow and tiered networks to lower costs by contracting with, or favoring, selected providers. Little is known about the contemporary effects of narrow or tiered networks on key metrics. The purpose of this systematic review was to synthesize the evidence on how narrow and tiered networks impact cost, access, quality, and patient steering. We searched PubMed, MEDLINE, and Cochrane Central Register of Controlled Trials databases for articles published from January 2000 to June 2020. Both narrow and tiered networks are associated with reduced overall health care costs for most cost-related measures. Evidence pertaining to access to care and quality measures were more limited to a narrow set of outcomes or were weak in internal validity, but generally concluded no systematic adverse effects on narrow or tiered networks. Narrow and tiered networks appear to reduce costs without affecting some quality measures. More research on quality outcomes is warranted.

Obamacare: A bibliometric perspective

Obamacare is the colloquial name given to the Affordable Care Act (ACA) signed into law by President Obama in the USA, which ultimately aims to provide universal access to health care services for US citizens. The aim of this paper is to provide an overview of the political-legal, economic, social, management (or administrative), and medical (or health) repercussions of this law, using a bibliometric methodology as a basis. In addition, the main contributors to research on ACA issues have been identified in terms of authors, organizations, journals, and countries. The downward trend in scientific production on this law has been noted, and it has been concluded that a balance has not yet been reached between the coexistence of private and public health care that guarantees broad social coverage without economic or other types of barriers. The law requires political consensus to be implemented in a definitive and global manner for the whole of the United States.

[10 Years Accountable Care Organizations in the USA: Impulses for Health Care Reform in Germany?]

GOAL OF THE STUDY

An intent of the Patient Protection and Affordable Care Acts (ACA), also know as Obama Care, was to slow the expenditure growth in the public Medicare-System by shifting the accountability for health care outcomes and costs to the provider. For this purpose, provider were allowed to form networks, which would then take accountability for a defined population - Accountable Care Organizations (ACOs). Ten years after the introduction of ACOs, this paper looks at the impact of ACOs both on quality of care and costs of care to assess if ACOs can be a model of care delivery for Germany.

METHODS

In a mixed-method approach, a rapid review was conducted in Health System Evidence and PubMed. This was supported with further papers identified using the snowballing-technique. After screening the abstracts, we included articles containing information on cost- and/or quality impact of US-Medicare-ACOs. The findings of the rapid review were challenged with 16 ACO-experts and stakeholder in the USA.

RESULTS

In total, we included 60 publications which incorporated 6 reports that were either conducted directly by governmental institutions or ordered by them, along with 3 previous reviews. Among these, 31 contained information on costs of care, 18 contained information on quality of care and 11 had information on both aspects. The publications show that ACOs reduced costs of of care. Cost reductions were achieved compared to historic costs, to populations not cared for in ACOs, and counterfactuals. Quality of care stayed the same or improved.

CONCLUSION

ACOs contributed to slowing the cost growth in US Medicare without compromising quality of care. Thus, a transferal of this model of care to Germany should be considered. However, various policies have led to ACOs failing to unleash their full potential. Against this background, and against the background of stark differences between US Medicare and the German health care system, a critical reflection of the necessary policies underlying ACOs-like structures in Germany, needs to be undertaken.

Differences in trends of perceived inpatient care quality based on regional socioeconomic level in the United States and Taiwan

OBJECTIVE

To examine perceived inpatient care quality according to regional socioeconomic status (SES), measured by regional household income, across the United States and Taiwan.

DATA SOURCES

Patient Experience in Hospital Care (PEHC) survey 2018-2019 data from National Taiwan University; US Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) 2018-2019 data from CMS.gov; and household income and facility data from publicly accessible databases.

STUDY DESIGN

This retrospective study used multivariate logistic regression to estimate the effect of household income on the rate of positive inpatient experiences in Taiwan and the United States, adjusting for hospitals' teaching status and ownership, and physician density.

DATA COLLECTION

Hospital administrators for HCAHPS and PEHC's research teams invited patients who received inpatient care during the data collection period in the United States and Taiwan, respectively. The analysis included 1024 facilities from nine US states and 350 facilities from twenty major cities/counties in Taiwan.

PRINCIPAL FINDINGS

Perceived inpatient care quality was higher in the United States than in Taiwan for the three experience measures. In Taiwan, hospitals with higher regional SES were less likely to receive a highly positive response for perceived respect, accommodation quality, and understanding upon discharge, with odds ratios (ORs) ranging from 0.83 to 0.88. In contrast, in the United States, higher regional SES was associated with a higher likelihood of a positive response for accommodation quality and understanding upon discharge (ORs = 2.51 and 1.48). Regional physician density and individual hospital characteristics show varying effects on perceived quality between Taiwan and the United States.

CONCLUSIONS

Higher overall experience scores in the United States are consistent with higher spending on health care compared with Taiwan. Varying associations between regional SES and perceived inpatient care quality highlight how systemic and cultural differences between the two countries affect scoring patterns.

Traditional Medicare Spending on Inpatient Episodes as Hospitalizations Decline

OBJECTIVE

To describe Medicare inpatient episode spending trends between 2009 and 2017 as inpatient use declined among traditional Medicare beneficiaries.

METHODS

Inpatient episodes included claims for all traditional Medicare inpatient, outpatient, and Part D services provided during the 30 days prehospitalization, the inpatient stay, and the 90 subsequent days. We describe the mean number of episodes per 1000 beneficiaries, mean episode-related spending per beneficiary, and mean spending per episode for all beneficiaries and for specific populations and types of episodes. Spending measures are reported with and without adjustment for payment rate increases over the study period.

RESULTS

The number of inpatient-initiated episodes per 1000 beneficiaries declined by 18.2% between 2009 and 2017 from 326 to 267. After adjusting for payment rate increases, Medicare spending per beneficiary on episode- related care declined by 8.9%, although spending per episode increased by 11.4% over this period. Between 2009 and 2017, all subgroups defined by age, sex, race, or Medicaid status experienced declines in inpatient use accompanied by decreased overall episode-related spending per beneficiary and increased spending per episode. Larger declines in the number of episodes per 1000 beneficiaries were seen among episodes that began with a planned admission (28.8%) or involved no use of post-acute care services (23.9%). When comparing admissions according to medical diagnosis, the largest decline occurred for episodes initiated by a hospitalization for a cardiac or circulatory condition (31.8%).

CONCLUSION

Medicare inpatient episodes per beneficiary decreased, but spending decreases due to declining volume were offset by increased spending per episode.

Trends in medicare spending across strata of resource utilization among older individuals in the United States

BACKGROUND

Health care spending is an increasing proportion of government expenditures in most Western countries. How this growth is distributed between individuals with minimal compared to high health care utilization is unknown.

METHODS

We examined total and per-capita government expenditure in an observational cohort of fee-for-service U.S. Medicare enrollees aged ≥65 years from 2007 to 2018. We categorized patients into annual resource utilization strata. We examined annualized changes in adjusted spending across resource utilization strata and the distribution of spending within and across strata for a variety of health care settings.

FINDINGS

Examining 314,593,489 beneficiary-years of coverage, the top 1% of beneficiaries accounted for 14.9% of all expenditures, the top 5% for 41.5%, the top 10% for 60.0%, the top 20% for 79.1%, and the top 50% for 95.7%. Annual expenditures remained relatively stable from 2007 to 2018, with annual mean change of 0.7% (standard deviation 1.1%; median 1.1%) and mean per capita change of 0.4% (standard deviation 1·6%; median 0·3%). Changes were similar across strata with mean increases <1% in all, save for the <50th percentile strata (mean annual growth=1·9%), a significant difference (p = 0.0002). The overall distribution of expenditures across health care settings remained consistent over time, with different distributions between expenditure strata.

INTERPRETATION

In the U.S. from 2007 to 2018, Medicare spending has a Pareto distribution in which 80% of the costs are attributable to 20% of beneficiaries. Despite low overall Medicare spending growth from 2007 to 2018, growth has been greatest among those in the lowest spending group.

FUNDING

The Commonwealth Fund (20,202,411).

Excess Medical Care Spending: The Categories, Magnitude, and Opportunity Costs of Wasteful Spending in the United States

Landmark reports from reputable sources have concluded that the United States wastes hundreds of billions of dollars every year on medical care that does not improve health outcomes. While there is widespread agreement over how wasteful medical care spending is defined, there is no consensus on its magnitude or categories. A shared understanding of the magnitude and components of the issue may aid in systematically reducing wasteful spending and creating opportunities for these funds to improve public health.To this end, we performed a review and crosswalk analysis of the literature to retrieve comprehensive estimates of wasteful medical care spending. We abstracted each source's definitions, categories of waste, and associated dollar amounts. We synthesized and reclassified waste into 6 categories: clinical inefficiencies, missed prevention opportunities, overuse, administrative waste, excessive prices, and fraud and abuse.Aggregate estimates of waste varied from $600 billion to more than $1.9 trillion per year, or roughly $1800 to $5700 per person per year. Wider recognition by public health stakeholders of the human and economic costs of medical waste has the potential to catalyze health system transformation.

An Economic Perspective on the Affordable Care Act: Expectations and Reality

The Affordable Care Act (ACA) was enacted in 2010 to address both high uninsured rates and rising health care spending through insurance expansion reforms and efforts to reduce waste. It was expected to have a variety of impacts in areas within the purview of economics, including effects on health care coverage, access to care, financial security, labor market decisions, health, and health care spending. To varying degrees, legislative, executive, and judicial actions have altered its implementation, affecting the extent to which expectations in each of these dimensions have been realized. We review the ACA's reforms, the subsequent actions that countered them, and the expected and realized effects on coverage, access to care, financial security, health, labor market decisions, and health care spending.