Aug. 14 News and Observer Column

Today's column in the News and Observer looks at end of life costs in the Medicare program.

This is a key issue because Medicare pays for the health care of about 8 in 10 Americans who die each year, and costs rise rapidly near death. As the baby boomers retire, something must be done, and there are really only two basic possibilities: increase what is coming in, or decrease what is going out.

**Here is a paper discussing the issue of one fourth of Medicare spending going for care provided to someone in their last year of life.
**Here is the paper referred to that shows hospice saves Medicare money.
**Here is a paper describing desires/wishes of patients, families and providers near the end of life.
**Here is a paper demonstrating relationship between age at death and costs for acute and long term care.
**Here is a useful link to the Medicare section of the Kaiser Family Foundation web site, the best source of basic health policy info.
**Here is a nice (or not so nice) visual about what happens if we do nothing.
**Since the column talked about death quite a bit, I have included a link to the full gory details of all deaths in the USA in 2006 (last year with fully verified info.). Death statistics.

There are many, many other sources that could be used to demonstrate the aggregation of costs as people age, and particularly as they near death.

*Two key sources of information for the column today: (1) CBO assessment of of an Independent Medicare Advisory Commission; and (2) the Patients' Choice Act, with guidance to the portions of the bill that create the Health Services Commission and related Forum for Quality and Effectiveness in Health Care.

(1) CBO. Here is the letter from the CBO Director Elmendorf to Steny Hoyer, House Majority Leader, commenting on President Obama's proposal for an Independent Medicare Advisory Commission (IMAC). A very important quote from this July 25, 2009 document (entire second paragraph of Elmendorf's letter) is the following:

"Expanding the authority of the President to effect change in the Medicare program
might lead to significant long-term savings in federal spending on health care. The available evidence implies that a substantial share of spending on health care contributes little, if anything, to the overall health of the nation. Therefore, experts generally agree that changes in government policy have the potential to significantly reduce health care spending—for the nation as a whole and for the federal government in particular—without harming people’s health. However, achieving large reductions in projected spending would require fundamental
changes in the financing and delivery of health care."

He is saying that at least some of what we do in medical care does not produce very much (or any) benefit for patients, and that we could stop doing some of this without hurting the health of Medicare beneficiaries. This reality is presumably what has lead both President Obama and the writers of the main Republican alternative reform bill to try and look closely at this issue.

*Here is a link to the full Patients' Choice Act Co-sponsored in the House by Rep. Ryan and Nunes, and in the Senate by Sens. Coburn and Burr. You can read the entire thing and can navigate around it fairly easily with the find function in Adode Acrobat.

You can read it for yourself, but this is a very serious attempt (a good portion of title VIII, pages 206-215 in the bill) to apply cost effectiveness research in a comprehensive manner in order to develop guidelines and standards for what and how care is provided in the health care system, with provisions to penalize providers who do not follow them (guidelines, directives) by banning them from billing federal health insurance plans (Medicare, Medicaid) and/or civil fines imposed on providers. The legislation states that the best research is to be used to do this work, driven by experts from outside of government. This commission (and the Quality Forum, a sub unit of the Commission) is proposed in the context of a health system in which Medicare would remain independent, and individual's would be purchasing private insurance through state-based exchanges that would be regulated to cover a benefit package similar to the benefit package enjoyed by Congress. These provisions in the bill seem to focus on the entire health care system, but the Act allows private insurers to sell plans outside of exchanges. It seems to me it would be better to start with Medicare, then apply lessons learned more broadly, but this idea along with that proposed by President Obama provides a bipartisan way to get a handle on Medicare costs in a way that is driven by the best experts and the best research. This bill, introduced May 20, 2009, was the first, and to this point, most serious effort to actually 'bend the curve' in my opinion, and the President has followed suit with consideration of a similar Commission.

The key sections for what I wrote about today, creation of a Health Services Commission can be found in Title VIII of the Act beginning on page 206 and running to page 215. Several key aspects of this part of the Patients' Choice Act.
*Purpose, sec. 801 (b), p. 207
(b) PURPOSE.—The purpose of the Commission is to
11 enhance the quality, appropriateness, and effectiveness of
12 health care services, and access to such services, through
13 the establishment of a broad base of scientific research
14 and through the promotion of improvements in clinical
15 practice and in the organization, financing, and delivery
16 of health care services.

*Duties, sec. 802 (a), p. 207-08
(a) IN GENERAL.—In carrying out section 801(b),
23 the Commissioners shall conduct and support research,
24 demonstration projects, evaluations, training, guideline de
25 velopment, and the dissemination of information, on
1 health care services and on systems for the delivery of
2 such services, including activities with respect to—
3 (1) the effectiveness, efficiency, and quality of
4 health care services;
5 (2) the outcomes of health care services and
6 procedures;
7 (3) clinical practice, including primary care and
8 practice-oriented research;
9 (4) health care technologies, facilities, and
10 equipment;
11 (5) health care costs, productivity, and market
12 forces;
13 (6) health promotion and disease prevention;
14 (7) health statistics and epidemiology; and
15 (8) medical liability.

*The Act also creates, under subtitle B, a sub-unit of the Health Services Commission, a 15 member Forum for Quality and Effectiveness in Health Care.

*Membership, sec. 812, p. 210-11
(a) IN GENERAL.—The Office of the Forum for Qual23
ity and Effectiveness in Health Care shall be composed
24 of 15 individuals nominated by private sector health care

p.211
1 organizations and appointed by the Commission and shall
2 include representation from at least the following:
3 (1) Health insurance industry.
4 (2) Health care provider groups.
5 (3) Non-profit organizations.
6 (4) Rural health organizations.

*Duties of the Forum, sec. 813, p. 211-12
(a) ESTABLISHMENT OF FORUM PROGRAM.—The
24 Commissioners, acting through the Director, shall estab
25lish a program to be known as the Forum for Quality and

p. 212
Effectiveness in Health Care. For the purpose of pro
2moting transparency in price, quality, appropriateness,
3 and effectiveness of health care, the Director, using the
4 process set forth in section 814, shall arrange for the de
5velopment and periodic review and updating of standards
6 of quality, performance measures, and medical review cri
7teria through which health care providers and other appro
8priate entities may assess or review the provision of health
9 care and assure the quality of such care.

*How will guidelines and standards be developed, p. 212
(b) CERTAIN REQUIREMENTS.—Guidelines, stand
11ards, performance measures, and review criteria under
12 subsection (a) shall—
13 (1) be based on the best available research and
14 professional judgment regarding the effectiveness
15 and appropriateness of health care services and pro
16cedures; and
17 (2) be presented in formats appropriate for use
18 by physicians, health care practitioners, providers,
19 medical educators, and medical review organizations
20 and in formats appropriate for use by consumers of
21 health care.

*When they will bring about guidelines, p. 213
(e) DATE CERTAIN FOR INITIAL GUIDELINES AND
15 STANDARDS.—The Commissioners, by not later than Jan
16uary 1, 2012, shall assure the development of an initial
17 set of guidelines, standards, performance measures, and
18 review criteria under subsection (a).

*Enforcement Standards, sec. 814, p. 213-214
SEC. 814. ADOPTION AND ENFORCEMENT OF GUIDELINES
20 AND STANDARDS.
21 (a) ADOPTION OF RECOMMENDATIONS OF FORUM
22 FOR QUALITY AND EFFECTIVENESS IN HEALTH CARE.—
23 For each fiscal year, the Commissioners shall adopt the
24 recommendations made for such year in the final report
25 under subsection (d)(2) of section 813 for guidelines,

1 standards, performance measures, and review criteria de
2scribed in subsection (a) of such section.
3 (b) ENFORCEMENT AUTHORITY.—The Commis
4sioners, in consultation with the Secretary of Health and
5 Human Services, have the authority to make recommenda
6tions to the Secretary to enforce compliance of health care
7 providers with the guidelines, standards, performance
8 measures, and review criteria adopted under subsection
9 (a). Such recommendations may include the following,
10 with respect to a health care provider who is not in compli
11ance with such guidelines, standards, measures, and cri
12 teria:
13 (1) Exclusion from participation in Federal
14 health care programs (as defined in section
15 1128B(f) of the Social Security Act (42 U.S.C.
16 1320a–7b(f))).
17 (2) Imposition of a civil money penalty on such
18 provider.


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