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CCH® BENEFITS — 5/15/08

Construction Slows On Four Cornerstones Of Health Reform

From Spencer's Benefits Reports: Implementation of the four cornerstones for health care reform instigated by the Department of Health and Human Services (HHS) two years ago is continuing, but there still is a long way to go, reported HHS Secretary Michael Leavitt at the Midwest Business Group on Health’s (MBGH) annual conference in Chicago on May 1.

A large number of quality measures, the first cornerstone, have been established, but the pace of identification must accelerate and must be standardized, Mr. Leavitt said. A collaborative model, through such groups as the National Quality Forum, the American Medical Association, and other groups currently involved in the process, would be the best, but not the only way, to standardize those measures, he added. The HHS currently is performing an inventory of the quality measures it is now using and plans to publish those measures and standardize them within the department.

Price Comparisons Too Complicated

With respect to health care price comparisons, the second cornerstone, there has been a steady stream of cost data over the past three years, Mr. Leavitt noted. The Robert Wood Johnson Foundation is doing research on prices for treatment of 20 common medical conditions, he said. Currently, “the price we pay for health care cannot be understood by a person of average intelligence and patience,” he commented. Last year, Medicare paid for 250,000 knee replacements, and a bundled price for performing these procedures makes the most sense, Mr. Leavitt added. Medicare plans to begin publishing the costs and volumes for the top medical procedures.

Standards are set for health information technology (IT), the third cornerstone, with interoperability still to be addressed, Mr. Leavitt continued. Employers and health insurers are vital components in fostering interoperability implementation by requiring it and paying for it. While large physician practices and hospitals already have adopted health IT, small physician practices are lagging behind, he said. The HHS is taking steps to bring small physician practices on board the health IT bandwagon. Interoperative IT platform legislation is pending in Congress. Medical providers need incentives to adopt such measures and Congress needs to enable the process, Mr. Leavitt said. “For example, to push e-prescribing, Congress can give HHS the authority to say to prescribers, ‘we can’t pay you unless you have e-prescribing.’

“We are making progress in working toward the elimination of duplication and unnecessary medical procedures [the fourth cornerstone], including with proposed federal legislation to be introduced this summer, that would allow Medicare to negotiate prices,” Mr. Leavitt proceeded. He emphasized the importance of local “change partners,” such as the MBGH, in the successful development and implementation of health care reform. “There’s a symbiotic relationship between Medicare and the larger health care system,” he acknowledged. Health care plans and employers need credible and reliable data on quality outcomes to help them drive patients to “efficient” medical providers.

A major problem in establishing a standard data source is that each insurer has its own limited data base, Mr. Leavitt concluded. All data must be combined and standardized in a way that establishes trust for providers and patients. There must be one coordinator for all medical bills for one medical “procedure” and bundled pricing.

For more information on this and related topics, consult the CCH Pension Plan Guide, CCH Employee Benefits Management, and Spencer's Benefits Reports.

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