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Can Telemedicine Be the Future of Health Care Accountable Care Organizations, Explained President Signs Healthcare Cybersecurity Language into Law
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C O N T E N T S
4 Can Telemedicine Be The Future of Health Care
6 Major Player Health Systems Want to Broaden Telehealth’s Bandwidth
7 Accountable Care Organizations, Explained
11 5 Years Later: How the Affordable Care Act is Working for New Jersey
14 President Signs Healthcare Cybersecurity Language into Law
15 Large Medical Groups and Hybrid Concierge Care
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Can Telemedicine Be The Future Of Health Care? Telemedicine allows patients to receive medical treatment regardless of time and distance. But why have U.S. states been so slow to embrace it? Michael Ollove Telemedicine has been praised as a cost-effective way to link doctors and patients, enabling physicians to monitor their medical conditions and consult with specialists in a way that overcomes time and distance. But despite a half-century of technological advances, the ready availability of interactive devices, and the full-throated encouragement of the Obama administration, advocates say telemedicine has failed to reach its full potential, due largely to policies in some states that make it difficult to practice, and pay for, such care. “The technology has opened up this huge opportunity, this game changer,” said Allison Wils, director of health policy for the ERISA Industry Council, a trade association that advocates on issues related to health care for large, multistate employers. “The problem is that there are still varying levels of comfort with it across the states.” Some states require that patients be accompanied by a health professional during telemedicine sessions. Hawaii, Indiana and Ohio limit Medicaid coverage to patients who live a minimum distance from their providers. (In Indiana, for example, the standard is 20 miles.) Another significant hurdle is the requirement that doctors be licensed in every state where they practice medicine, digitally or otherwise. Because of those barriers, telemedicine advocates say, the elderly, the infirm, the isolated and the busy are being denied full access to needed health care. States that have been slower to embrace telemedicine, including Arkansas, Rhode Island and Texas, are merely being prudent, waiting to be assured that the new technology does not diminish the quality of care patients receive, say some physician regulatory boards. “There is a concern that whatever is put in place not be dangerous,” said Lisa Robin, chief advocacy officer for the Federation of State Medical Boards, which represents the state boards that license and discipline doctors. But those pushing for a less restrictive approach to telemedicine say it is not an inferior form of medicine but a vehicle for extending quality health care to more places. And, they argue, some policies hampering the spread of telemedicine have been motivated by fear of competition among more traditional practitioners. “In some states, the issue comes down to protecting their doctors from outside competition,” said Latoya Thomas, director of state health policy at the American Telemedicine Association (ATA). “Their doctors with brick-and-mortar practices assume that someone who uses telemedicine is trying to take away patients.” NASA Origins Telemedicine’s origins date back to the early days of the U.S. space program, when NASA scientists developed technology that enabled doctors to monitor the physiological conditions of astronauts in space. Thanks to rapid advances in interactive technology, telemedicine developed quickly, principally to link physicians to remote populations in such places as Alaska and Arizona's Tohono O'odham Indian Reservation. Telemedicine also spread from rural to urban areas. Doctors now monitor or communicate with patients from afar on everything from routine preventive care to chronic disease management and psychiatric conditions. Primary care doctors and their patients consult with specialists and diagnosticians who might otherwise be beyond their geographic reach. The industry received a major boost from the American Recovery and Reinvestment Act of 2009 and the Affordable Care Act of 2010, both of which increased federal spending on health information technology and telemedicine. President Barack Obama has often extolled its potential to increase access to quality health care while cutting costs. Nearly 13 million Americans use telemedicine, according to the ATA. Regulating Coverage As telemedicine spread in the 2000s, more state legislatures and state medical regulatory boards adopted telemedicine policies. Some state laws and regulations govern insurance coverage of telemedicine. Twenty-nine states now have parity laws that require private insurers to pay for telemedicine at the same rate as in-person services, according to the ATA. Arkansas, Michigan, Oregon and Vermont only require parity if the technology is both audio and visual or in real-time rather than recorded. Arizona only enforces parity when patients live very far from providers. In addition, 48 state Medicaid programs offer at least some coverage for telemedicine. Connecticut and Rhode Island are the only states that largely refuse to pay for telemedicine in their Medicaid programs. About half of state Medicaid programs require that a patient be in some sort of medical facility during telemedicine encounters, rather than at home. Earlier this year, Connecticut enacted a law requiring private insurers to cover telemedicine.
4 AFFILIATED PRACTICE
Joseph Wendelken, of the Rhode Island Health Department, said that, because of Rhode Island’s small size, “what is generally referred to as telehealth is less common in our state.” Rhode Islanders, he noted, are generally located within an hour’s drive of first-class medical centers with topflight specialists. Restrictions on Telemedicine Many states have also adopted laws and policies concerning how physicians practice telemedicine. Some states require that a health professional be physically present with a patient during a telemedicine session. Most states require patients to sign special consent forms. Some states require in-person follow-ups. Texas is locked in a federal lawsuit with the provider Teladoc, which digitally links patients and doctors, over the state’s requirement that doctors meet with patients in person before moving to a digital relationship or have other providers physically present with patients when treating them remotely for the first time. Arkansas has a similar law. Russell Thomas, a family practice doctor in the small town of Eagle Lake, Texas, and former member of the Texas Medical Board and of the Federation of State Medical Boards, provides primary care through videoconferencing to at-risk students at a high school 300 miles away. He also consults with cardiologists and dermatologists in Houston for his patients. But, he said, doctors should first meet with patients before moving to a digital relationship. “I can’t imagine that I can provide the best care to my patients if I never laid eyes on them, if I never physically assessed them.” For its part, the ATA argues that telemedicine doctors should be governed by the same policies and restrictions that apply to traditional physicians. “Our belief is that if you license a health care provider, you expect them to uphold the standard of care—whatever tools they are using,” the ATA’s Thomas said. In other words, it should be left up to each physician who practices telemedicine to determine if a remote session suffices or if a face-to-face visit is necessary. States that put additional requirements on telemedicine doctors, she said, are depriving people of access to medical care. “It’s a delivery model that may not be familiar to everyone, but where it is available, it should be used fully.”
DECEMBER 2015
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Major-player health systems want to broaden telehealth’s bandwidth By Beth Kutscher Community Health Systems' wide-reaching push into telemedicine signals growing demand for remote technology that delivers lower costs and convenient access to care. The Franklin, Tenn.-based chain, which runs more hospitals than any other U.S. healthcare company, has a non-urban focus and previously used telemedicine to provide specialty services to its patients. But a new partnership with American Well, called VirtualHealth Now, will allow patients to access urgent-care services 24/7 in at least four states. A growing number of health systems are beginning to use the technology not only to link rural hospitals with tertiary-care facilities, but also to provide ongoing chronic disease management. Still, telehealth's adoption remains complicated by regulatory, financial and administrative barriers. Although many states, including Minnesota and New York, have introduced or passed legislation in the past year to increase insurance coverage for telemedicine visits, others—notably Texas—are moving in the opposite direction. A new Texas rule requires patients to have an in-person provider visit before they can use telemedicine technologies. But those barriers may fall away as large players adopt telehealth services. “What we've seen in the last two to three years is that providers of all types are thinking, 'How do we do more with less?' ” said Danielle Russella, president of customer solutions at American Well. The Boston-based company provides the mobile and Web platforms for telehealth programs launched by Community and several other major health systems, including the Cleveland Clinic and Salt Lake City-based Intermountain Healthcare. “For us, it's been kind of explosive,” she said. AllianceHealth Oklahoma and Rockwood Health System in Spokane, Wash., are Community's first network hospitals to introduce telehealth services. In those markets, patients will be able to see a doctor through their smartphone, computer or tablet, and the technology can link directly to their electronic health records. Community also plans to add telehealth services in Arizona and Pennsylvania. The market for telemedicine is projected to grow at a rate of more than 50% a year—ballooning from $240 million in 2013 to $1.9 billion by 2018, according to IHS, a data and analytics firm. Health systems are becoming increasingly interested in telehealth services as they enter more capitated payment contracts and start to act more like health insurers, said Bryan Cote, managing director at Berkeley Research Group. As large healthcare providers expand their use of telemedicine, industry momentum may build to break down the regulatory and financial barriers slowing its adoption. “This is an important component to our primary-care strategy,” said Dr. Lynn Simon, Community's chief quality officer. “Consumers want access and they want it to be convenient.” Community already uses telehealth in specialties such as neurology, intensive care and home health, Simon said. But its latest partnership will provide more access points for both current and new patients. Ultimately, the system will offer similar services for behavioral health and chronic disease management, and the platform may also be used to monitor newly discharged patients as a way to prevent readmissions. The system also plans to offer telehealth services as part of its partnerships with employers. It is working to set up telehealth kiosks at worksites, particularly in locations where workers don't have traditional office-based jobs, Russella said. Consumers will pay a $39 fee for the service, but Community hopes that its relationships with employers and health plans will encourage service charges to be offset for some users. “A big part of this is, how are the payments made and is there parity with in-person visits,” said Mike Simmons, CEO of CredSimple, which offers credentialing software for providers. About half of CredSimple's clients are telehealth companies. “That payment parity is hugely important,” he said. Some telemedicine firms are seeking certification from credentialing bodies such as the National Committee for Quality Assurance as a way to gain a competitive advantage. “That's one of the bottlenecks—how do you get the provider to be accepted by the insurance provider?” Simmons said. In response to the litany of requests they're receiving from providers that want to offer telehealth services, commercial health insurers are starting to set up task forces, Cote said. An October survey from Anthem and the American Academy of Family Physicians found that about 15% of primary-care doctors had used some form of telemedicine technology over the past year, but close to 90% said they would be more interested if they got paid for it.
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Accountable Care Organizations, Explained By Jenny Gold One of the main ways the Affordable Care Act seeks to reduce health care costs is by encouraging doctors, hospitals and other health care providers to form networks that coordinate patient care and become eligible for bonuses when they deliver that care more efficiently. The law takes a carrot-and-stick approach by encouraging the formation of accountable care organizations (ACOs) in the Medicare program. Providers make more if they keep their patients healthy. About 6 million Medicare beneficiaries are now in an ACO, and, combined with the private sector, at least 744 organizations have become ACOs since 2011. An estimated 23.5 million Americans are now being served by an ACO. You may even be in one and not know it. While ACOs are touted as a way to help fix an inefficient payment system that rewards more, not better, care, some economists warn they could lead to greater consolidation in the health care industry, which could allow some providers to charge more if they’re the only game in town. ACOs have become one of the most talked about new ideas in Obamacare. Here are answers to some common questions about how they work: What is an accountable care organization? An ACO is a network of doctors and hospitals that shares financial and medical responsibility for providing coordinated care to patients in hopes of limiting unnecessary spending. At the heart of each patient’s care is a primary care physician. In Obamacare, each ACO has to manage the health care needs of a minimum of 5,000 Medicare beneficiaries for at least three years. Think of it as buying a television, says Harold Miller, president and CEO of the Center for Healthcare Quality & Payment Reform in Pittsburgh, Pa. A TV manufacturer like Sony may contract with many suppliers to build sets. Like Sony does for TVs, Miller says, an ACO brings together the different component parts of care for the patient – primary care, specialists, hospitals, home health care, etc. – and ensures that all of the “parts work well together.” The problem with most health systems today, Miller says, is that patients are getting each part of their health care separately. “People want to buy individual circuit boards, not a whole TV,” he says. “If we can show them that the TV works better, maybe they’ll buy it,” rather than assembling a patchwork of services themselves. Why did Congress include ACOs in the law? As lawmakers searched for ways to reduce the national deficit, Medicare became a prime target. With baby boomers entering retirement age, the costs of caring for elderly and disabled Americans are expected to soar. The health law created the Medicare Shared Savings Program. In it, ACOs make providers jointly accountable for the health of their patients, giving them financial incentives to cooperate and save money by avoiding unnecessary tests and procedures. For ACOs to work, they have to seamlessly share information. Those that save money while also meeting quality targets keep a portion of the savings. Providers can choose to be at risk of losing money if they want to aim for a bigger reward, or they can enter the program with no risk at all. In addition, the Centers for Medicare & Medicaid Services (CMS) created a second strategy, called the Pioneer Program, for highperforming health systems to pocket more of the expected savings in exchange for taking on greater financial risk. In 2014, the 20 ACOs in the Medicare Pioneer Program and 333 in the Medicare Shared Savings generated $411 million in total savings but after paying bonuses, the program resulted in a net loss of $2.6 million to the Medicare trust fund. That’s far less than 1 percent of Medicare spending during that period. Still the program is expected to be expanded and Health and Human Services Secretary Sylvia Burwell has set a goal of tying 50 percent of all traditional Medicare payments to quality or value by 2018 through new payment models, including ACOs. How are ACOs paid? In Medicare’s traditional fee-for-service payment system, doctors and hospitals generally are paid for each test and procedure. That drives up costs, experts say, by rewarding providers for doing more, even when it’s not needed. ACOs don’t do away with fee for service, but they create an incentive to be more efficient by offering bonuses when providers keep costs down. Doctors and hospitals have to meet specific quality benchmarks, focusing on prevention and carefully managing patients with chronic diseases. In other words, providers get paid more for keeping their patients healthy and out of the hospital. If an ACO is unable to save money, it could be stuck with the costs of investments made to improve care, such as adding new nurse care managers. An ACO also may have to pay a penalty if it doesn’t meet performance and savings benchmarks, although few have opted into that program yet. ACOs sponsored by physicians or rural providers, however, can apply to receive payments in advance to help them build the infrastructure necessary for coordinated care – a concession the Obama administration made DECEMBER 2015
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after complaints from rural hospitals. In 2014, the third year of the Medicare ACO program, 97 ACOs qualified for shared savings payments of more than $422 million. How do ACOs work for patients? Doctors and hospitals will likely refer patients to hospitals and specialists within the ACO network. But patients are usually still free to see doctors of their choice outside the network without paying more. Providers who are part of an ACO are required to alert their patients, who can choose to go to another doctor if they are uncomfortable participating. The patient can decline to have his data shared within the ACO. Who’s in charge — hospitals, doctors or insurers? ACOs can include hospitals, specialists, post-acute providers and even private companies like Walgreens. The only must-have element is primary care physicians, who serve as the linchpin of the program. In private ACOs, insurers can also play a role, though they aren’t in charge of medical care. Some regions of the country, including parts of California, already had large multi-specialty physician groups that became ACOs on their own by networking with neighboring hospitals. In other regions, large hospital systems are scrambling to buy up physician practices with the goal of becoming ACOs that directly employ the majority of their providers. Because hospitals usually have access to capital, they may have an easier time than doctors in financing the initial investment, for instance to create the electronic record system necessary to track patients. Some of the largest health insurers in the country, including Humana, UnitedHealth and Aetna, have formed their own ACOs for the private market. Insurers say they are essential to the success of an ACO because they track and collect the data on patients that allow systems to evaluate patient care and report on the results.
If I don’t like HMOs, why should I consider an ACO? ACOs may sound a lot like health maintenance organizations. “Some people say ACOs are HMOs in drag,” says Kelly Devers, a senior fellow at the Urban Institute. But there are some critical differences – notably, an ACO patient is not required to stay in the network. Steve Lieberman, a consultant and senior adviser to the Health Policy Project at the Bipartisan Policy Center in Washington, D.C., explains that ACOs aim to replicate “the performance of an HMO” in holding down the cost of care while avoiding “the structural features that give the HMO control over [patient] referral patterns,” which limited patient options and created a consumer backlash in the 1990s. In addition, unlike HMOs, the ACOs must meet a long list of quality measures to ensure they are not saving money by stinting on necessary care. What could go wrong? Many health care economists fear that the race to form ACOs could have a significant downside: hospital mergers and provider consolidation. As hospitals position themselves to become integrated systems, many are joining forces and purchasing physician practices, leaving fewer independent hospitals and doctors. Greater market share gives these health systems more leverage in negotiations with insurers, which can drive up health costs and limit patient choice. But Lieberman says while ACOs could accelerate the merger trend, consolidations are already “such a powerful and pervasive trend that it’s a little like worrying about the calories I get when I eat the maraschino cherry on top of my hot fudge sundae. It’s a serious public policy issue with or without ACOs.” Are ACOs the future of health care? ACOs are already becoming pervasive, but they may be just an interim step on the way to a more efficient American health care system. “ACOs aren’t the end game,” says Chas Roades, chief research officer at The Advisory Board Company in Washington. One of the key challenges for hospitals and physicians is that the incentives in ACOs are to reduce hospital stays, emergency room visits and expensive specialist and testing services — all the ways that hospitals and physicians make money in the feefor-service system, explains Roades. He says the ultimate goal would be for providers to take on full financial responsibility for caring for a population of patients for a fixed payment, but that will require a transition beyond ACOs.
8 AFFILIATED PRACTICE
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5 Years Later: How the Affordable Care Act is Working for New Jersey The Affordable Care Act is working to make health care more affordable, accessible, and high quality for the people of New Jersey. Better Options Making health care more affordable and accessible through the Health Insurance Marketplaces: Through the Marketplace, New Jerseyans had the option of signing up for quality health coverage at a price they could afford. Whether they visited the simpler, faster and more intuitive website at HealthCare.gov or contacted the call center, they found more choices and competitive prices. In New Jersey, 254,316 consumers selected or were automatically re-enrolled in quality, affordable health insurance coverage through the Marketplace as of Feb. 22. Nationwide, nearly 11.7 million consumers selected a plan or were automatically enrolled in Marketplace coverage. Marketplace Signups and Tax Credits in New Jersey: • 83 percent of New Jersey consumers who were signed up qualified for an average tax credit of $306 per month through the Marketplace. • 38 percent of New Jersey Marketplace enrollees obtained coverage for $100 or less after any applicable tax credits in 2015, and 71 percent had the option of doing so. • In New Jersey, consumers could choose from 6 issuers in the Marketplace in 2015 – up from 4 in 2014. • New Jersey consumers could choose from an average of 45 health plans in their county for 2015 coverage – up from 26 in 2014. • 86,087 consumers in New Jersey under the age of 35 are signed up for Marketplace coverage (34 percent of plan selections in the state). And 63,299 consumers 18 to 34 years of age (25 percent of all plan selections) are signed up for Marketplace coverage. New Jersey has received $8,897,316 in grants for research, planning, information technology development, and implementation of its Marketplace. Open enrollment for 2015 coverage ended on Feb. 15, 2015. Open enrollment for 2016 coverage runs from November 1, 2015 to January 31, 2016. Consumers should visit HealthCare.gov to see if they qualify for a Special Enrollment Period because of a life change like marriage, having a baby or losing other coverage. Enrollment in Medicaid and the Children’s Health Insurance Program is open year round. Reducing the number of uninsured Americans: Nationwide, since the Affordable Care Act’s coverage expansion began, about 16.4 million uninsured people have gained health insurance coverage - the largest reduction in the uninsured in four decades. And Gallup recently announced that the uninsured rate in New Jersey in 2014 was 11.7 percent, down from 14.9 percent in 2013. New coverage options for young adults: Under the health care law, if your plan covers children, you can now add or keep your children on your health insurance policy until they turn 26 years old. Thanks to this provision, over 2.3 million young people who would otherwise have been uninsured have gained coverage nationwide. Expanding Medicaid: Thanks to the Affordable Care Act, states have new opportunities to expand Medicaid coverage to individuals with family incomes at or below 133 percent of the federal poverty level (generally $32,253 for a family of four in 2015). This expansion includes non-elderly adults without dependent children, who have not previously been eligible for Medicaid in most states. Thirty states plus DC have expanded Medicaid under the Affordable Care Act, including New Jersey. And as of January 2015, 383,964 New Jerseyans have gained Medicaid or CHIP coverage since the beginning of the Health Insurance Marketplace first open enrollment period. Across the nation, approximately 11.2 million more Americans are now enrolled in Medicaid and CHIP. Better Value Providing better value for your premium dollar through the 80/20 Rule: Health insurance companies now have to spend at least 80 cents of your premium dollar on health care or improvements to care, rather than administrative costs like salaries or marketing, or they have to provide you a refund. This means that 42,300 New Jerseyans with private insurance coverage benefited from $3,434,390 in refunds from insurance companies, for an average refund of $142 per family because of the Affordable Care Act. Scrutinizing unreasonable premium increases: In every State and for the first time under Federal law, insurance companies are required to publicly justify their actions if they want to raise rates by 10 percent or more. New Jersey has received $5,146,261 under the new law to help fight unreasonable premium increases. Since implementing the law, the fraction of requests for insurance premium increases of 10 percent or more has dropped dramatically, from 75 percent to 14 percent nationally. To date, the rate review program has helped save Americans an estimated $1 billion. Removing lifetime limits on health benefits: The law bans insurance companies from imposing lifetime dollar limits on health benefits – freeing cancer patients and individuals suffering from other chronic diseases from having to worry about going without treatment because of their lifetime limits. Already, 3,274,000 people in New Jersey, including 1,214,000 women and DECEMBER 2015
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877,000 children, are free from worrying about lifetime limits on coverage. The law also restricts the use of annual limits and bans them completely starting in 2014. Ending discrimination for pre-existing conditions: As many as 3,847,727 non-elderly New Jerseyans have some type of preexisting health condition, including 485,006 children. Today, health insurers can no longer deny coverage to anyone because of a pre-existing condition, like asthma or diabetes, under the health care law. And they can no longer charge women more because of their gender. Expanding mental health and substance use disorder benefits: The Affordable Care Act increases also access to comprehensive coverage by requiring most health plans to cover ten essential health benefit categories, to include hospitalization, prescription drugs, maternity and newborn care, and mental health and substance use disorder services. The health care law expands mental health and substance use disorder benefits and federal parity protections for 62 million Americans nationwide, including 1,550,543 New Jerseyans. Better Health Covering preventive services with no deductible or co-pay: The health care law requires many insurance plans to provide coverage without cost sharing to enrollees for a variety of preventive health services, such as colonoscopy screening for colon cancer, Pap smears and mammograms for women, well-child visits, and flu shots for all children and adults. Because of the Affordable Care Act, 76 million Americans with private health insurance gained preventive service coverage with no cost-sharing, including 2,282,000 in New Jersey. And women can now get coverage without cost-sharing of even more preventive services they need. Of the 76 million Americans with expanded access to free preventive services, 29.7 million are women, including 869,000 in New Jersey receiving expanded preventive services without cost-sharing. Investing in the primary care workforce: As a result of historic investments through the health care law and the Recovery Act, the numbers of clinicians in the National Health Service Corps are near all-time highs with 9,200 Corps clinicians providing care to approximately 9.7 million people who live in rural, urban, and frontier communities. The National Health Service Corps repays educational loans and provides scholarships to primary care physicians, dentists, nurse practitioners, physician assistants, behavioral health providers, and other primary care providers who practice in areas of the country that have too few health care professionals to serve the people who live there. As of September 30, 2014, there were 28 Corps clinicians providing primary care services in New Jersey, compared to 16 in 2008. Increasing support for community health centers: The Affordable Care Act increases the funding available to community health centers nationwide. Health Center grantees in New Jersey have received $141,537,234 under the health care law to offer a broader array of primary care services, extend their hours of operations, hire more providers, and renovate or build new clinical spaces.
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Of the $141,537,234 awarded to New Jersey, $5,254,350 was awarded to New Jersey health centers to help enroll uninsured Americans in the Health Insurance Marketplace. Overall, since 2013, New Jersey health centers used these funds to help more than 238,346 New Jersey residents with enrollment into affordable health insurance coverage, with 39,927 of those being assisted between October and December 2014. These investments ensure that health centers continue to be a trusted resource for assistance with enrollment in the Marketplace, Medicaid and CHIP in New Jersey. In New Jersey, 20 health centers operate 130 sites, providing preventive and primary health care services to 483,113 New Jerseyans, including 221,553 Latinos and 150,813 African Americans. Preventing illness and promoting health: Through Fiscal Year 2013, New Jersey has received $38,330,491 in grants from the Prevention and Public Health Fund created by the health care law. This fund was created to support effective policies in New Jersey and nationwide, such as initiatives focused on tobacco cessation, obesity prevention, health coverage enrollment assistance, and increasing the primary care and public health workforce, so that all Americans can lead longer, more productive lives. A Stronger Medicare Program Making prescription drugs affordable for seniors: In New Jersey, people with Medicare have saved nearly $774,061,327 on prescription drugs because of the Affordable Care Act. In 2014 alone, 214,327 individuals in New Jersey saved over $244,078,866, or an average of $1,139 per beneficiary. In 2015, people with Medicare in the “donut hole” received a 55 percent discount on covered brand name drugs and a 35 percent discount on generic drugs. And thanks to the health care law, coverage for both brand name and generic drugs will continue to increase over time until the coverage gap is closed. Nationally, over 9.4 million people with Medicare have saved over $15 billion on prescription drugs since the law’s enactment, for an average savings of $1,598 per beneficiary. Covering preventive services with no deductible or co-pay : With no deductibles or co-pays, cost is no longer a barrier for seniors and people with disabilities who want to stay healthy by detecting and treating health problems early. In 2014 alone, an estimated 39 million people benefited from Medicare’s coverage of preventive services with no cost-sharing. In New Jersey, 1,093,245 individuals with Medicare used one or more free preventive service in 2014. Cracking down on fraud and abuse: The health care law helps stop fraud with tougher screening procedures, stronger penalties, and new technology. More than $27.8 billion has been returned to the Medicare Trust Funds since 1997 because of these fraud enforcement efforts. For every dollar spent on health care-related fraud and abuse activities in the last three years the administration has recovered $7.70.
DECEMBER 2015
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President Signs Healthcare Cybersecurity Language into Law by Leslie Kriegstein Key Takeaway: The massive government spending package that was enacted late last Friday included language to enable cyber threat information sharing and directives to the Department of Health and Human Services (HHS) to better equip the healthcare sector to combat cyber attacks. Why It Matters: Congress responded to pleas from the provider community for additional resources to improve preparedness against cyber threats. The language included in the funding package seeks to improve clarity on who within the HHS leads cyber efforts and how sub-agencies should coordinate for the benefit of all stakeholders. The law also called for the creation of a healthcare industry cybersecurity task force within 90 days of enactment to: analyze how other industries have implemented strategies and safeguards for addressing cybersecurity threats within their respective industries; evaluate challenges to securing healthcare entities; review challenges with securing networked medical devices; and, what’s needed to implement cyber threat information sharing within the healthcare sector. Further, Section 405 directs the secretary of HHS, working with other federal and non-federal entities, to develop a common set of voluntary, consensus-based, and industry-led guidelines, best practices, methodologies, procedures and processes that can serve as a resource for reducing cybersecurity risks for a range of healthcare organizations. A draft of the healthcare-specific language was first included in the Senate’s Cybersecurity Information Sharing Act of 2015 when it passed in November (neither of the House-passed bills included health-specific directives), but the healthcare language was edited and ultimately included in the Omnibus spending package. Congress Passes Bill to Expand CMS’ Authority to Grant Hardship Exemptions for 2015 Program Year Key Takeaway: Before adjourning for 2015, one of the final acts of Congress was to pass legislation to expand the authority of the Centers for Medicare and Medicaid Services (CMS) to grant hardship exemptions to Meaningful Use participants for the 2015 program year. Why It Matters: Passage of this narrowly focused legislation is indicative of the growing bipartisan interest in Meaningful Use on Capitol Hill. Concerns about the delay in the release of the rules were voiced by Senate Health, Education, Labor & Pensions Committee Chairman Lamar Alexander (R-TN), echoed in a bipartisan letter signed by 116 members of the House, and again reiterated in a GOP Doctors Caucus letter sent to Speaker Paul Ryan (R-WI) in early December. The legislation, S. 2425, championed by Senators Rob Portman (R-OH) and Robert P. Casey, Jr. (D-PA), and modeled after legislation (H.R. 3940) introduced into the House by Rep. Tom Price, M.D. (R-GA), would allow eligible hospitals and eligible physicians who find it impossible to comply with the modified Stage 2 rule released into the final 90-day reporting period of 2015 to apply under the "unforeseen circumstances" category. The legislation enables CMS to grant hardships not just on a case-by-case basis, but also to "categories" with the deadline of March 15, 2016 for EPs and April 1, 2016 for EHs, after which time CMS would still have the case-by-case authority to grant hardship exemptions until July 1, 2016.
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Large Medical Groups and Hybrid Concierge Care By Wayne Lipton For a decade, the full concierge model has been the thorn in the side of large groups and institutions. They recognized the potential benefits of membership models for individual physicians, but for a variety of reasons, couldn't make the program fit within their business model. However recently, that has been changing. More and more large groups have realized there is an opportunity in concierge care that they have been missing. That opportunity is "hybrid concierge." As more private practices with blended programs have been acquired, larger groups are awakening to the benefits of hybrid concierge practice and are moving aggressively into the sector. Why has it taken so long? Full-model concierge programs have become popular in the marketplace, but they can present some problems for larger groups. First, full-models empower individual providers. This empowerment can be threatening to a practice where a physician has the ability to leave and work either for themselves or for someone else. In some situations, non-competes are not enforceable by law or by practicality, so it is difficult to get around this. Second, full-models are often in conflict with the philosophy of a large, vertically integrated system that is dependent on capturing the entire "medical business" of a patient. Their business model is based on productivity measures, with a strong focus on volume. A full-model program means fewer patients. And lower volumes mean fewer referrals. Lower volumes are in conflict with large-group productivity models. But larger groups and institutions still need to find ways to improve economically. Most have already implemented costcontainment initiatives. One example is the broad use of physician extenders. But now revenue is under attack. No matter what a group will get in the short term from "quality measures," the bar will continue to move higher and higher to save money globally. As such, alternative sources of revenue are needed. Any group that is able to tap into donations will tell you that this approach to funding is a blessing. Hospitals, institutions, and large not-for-profit groups all benefit by donations. However, not every group can tap into this funding source. What is left? Groups need to look toward a private source of available funding that does not interfere with the professional and business philosophy of groups. So here comes the hybrid approach to concierge care. In a typical medical group, there are often a variety of services offered — some more profitable than others. The more profitable services support the less profitable services, and therefore exist together harmoniously. Hybrid concierge is just like that. It doesn't take over the practice; it simply becomes one of the more profitable services the practice offers. In a hybrid program, a small portion of the physician's practice time is devoted to a group of patients who want additional services that they are willing to pay for out of pocket. Dedicating a portion of the practice day that is less than 20 percent of a physician's time and generates up to 50 percent of his revenue is an opportunity that larger groups cannot ignore. Through practice acquisitions, many larger groups were introduced to the benefits of the hybrid model. They realized that, unlike full-model concierge care, hybrid programs actually support their existing business models. They don't pose a risk — they provide a new financial opportunity. Almost all of the large groups realize there is significant value in not only keeping these programs, but expanding them into more and more sectors of their groups. The hybrid concierge model is an opportunity to tap into the most available and willing source of revenue — the patients who want a more physician-centric experience.
DECEMBER 2015
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