THE BULLETIN • TUESDAY, JUNE 19, 2012
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Discoveries, breakthroughs, trends, names in the news — things you need to know to start your day.
TODAY
NEED TO KNOW
An overlooked health-care issue By Jordan Rau
HAPPENINGS
Kaiser Health News
Often overlooked in the Supreme Court challenge to the health-care law are changes that hospitals, doctors and insurers had been moving toward even before the law was passed in 2010. Some of these could be halted if the court throws out the Affordable Care Act, or hobbled if the justices excise parts of it, experts say. The changes include increasing the role of primary care, especially for lowincome patients, forcing hospitals and doctors to work together closely, and reducing pay to hospitals if they don’t meet patients’ expectations or outcome benchmarks set by the government. “We have to change and we know that,” said Ken Raske, president and chief executive of the Greater New York Hospital Association, which represents 250 hospitals and other medical facilities. “But it’s easier if you’re going to build the building to have the shovels and picks and the hammer and nails than trying to dig it out with your hands. That’s what the Affordable Care Act is.”
Doctor shortage One of the concerns raised during the debate over the law was that expanding coverage would lead to a shortage of primary-care doctors. The law allocates more money to provide primary care to people, especially the poor. The theory is that seeking early care or preventive measures will help more people stay well enough to avoid expensive hospitalizations or develop chronic conditions. The government has spent $1.9 billion to build and expand community health centers and $512 million to train more health-care workers, including primary-care doctors, physician assistants and nurse practitioners, according to the Kaiser Family Foundation. Also at stake are some new methods to pay doctors and hospitals to reward good and efficient medical care, and ongoing efforts to come up with different reimbursement models. Many of these changes are being implemented by the Centers for Medicare & Medicaid Services. These include 65 collaborations among hospitals and doctors, which are
• The top vote-getters from Greece’s Sunday election meet to form a coalition government. • The Federal Reserve meets, and may discuss a change in strategy. E1
IN HISTORY
Rich Clement / Bloomberg News
Theresa Brown Gold of Bucks County, Pa., makes her support of the health-care law known amid protesters Monday at the Supreme Court in Washington, D.C. An often overlooked issue is how the court’s decision on health care will affect changes already undertaken by many health-care providers.
“I don’t think we’d be where we are today in accountable care but for the Affordable Care Act.” — Douglas Hastings, a Washington health-care lawyer
working as “accountable care organizations.” Freed from antitrust laws, they can earn bonuses from Medicare if they provide care more cheaply without sacrificing quality. While only those organizations that volunteered are in ACOs, another change starting in October would automatically affect most hospitals in the country. Medicare has announced that hospitals will face financial penalties or earn bonuses depending on their rates of readmissions, reviews by patients and thoroughness in following basic guidelines for clinical care. Physicians, too, will see their Medicare pay rise or fall based on the quality of their care and the degree to which their patients don’t overuse Medicare services. The health law’s authors want to supplant the current, widely used piecemeal payment system in which providers earn more for a great number of tests and treatments without any concern about quality. The federal Center for Medicare and Medicaid Innovation is experimenting with
dozens of other targeted trials, giving money to groups that seek to reduce the prevalence and costs of asthma in New England, strokes in Louisiana, chronic pain in North Carolina and dental problems and diabetes among Native Americans on South Dakota reservations.
An uncertain future If the government’s efforts are curtailed, it is not clear whether the private healthcare market will move forward with changes to coordinate care and operate more efficiently. “I don’t think we’d be where we are today in accountable care but for the Affordable Care Act,” said Douglas Hastings, a health-care lawyer in Washington. He noted that nearly half of all people in the country with coverage get it through the government. “When I sit in on meetings with private payers, they say, ‘We model a lot on what Medicare does.’ Accountable care may still move forward in the private market, but if this law is deemed unconstitutional, it slows down or stops the
momentum.” But J. Peter Rich, a healthcare lawyer in Los Angeles, said the movement to transform the way care is provided will continue even without the law, with providers joining together into larger systems, forming new affiliations and being held to new standards for keeping down expenses and delivering results to patients. “There’s tremendous cost pressure nationwide on health plans as well as hospitals, primary-care physicians and other providers,” he said. “With an aging population and the increasing financial burden of chronic diseases like Type 2 diabetes, these cost pressures are not going to go away.” Even if the law is struck down, some supporters say Medicare might be able to resurrect some of these ventures as demonstration projects. But it would need congressional authority to expand them nationwide, said Gail Wilensky, a former Medicare administrator. If the court “literally invalidated everything, they’d need new legislative authority,” she said. Kaiser Health News is an editorially independent news service of the of the Kaiser Family Foundation, a nonpartisan health-care policy organization that is not affiliated with Kaiser Permanente.
CUTTING EDGE
Medical apps become a magnet for venture capital By Anna Edney Bloomberg News.
WASHINGTON — Venture capitalists seeking to profit from innovations in health care are turning to startups that make smartphone and tablet applications for doctors and hospitals. Two years ago, patients would be surprised to see their doctors pulling out an Apple iPhone to check their blood sugar, or cardiogram results. Now they’re finding such practices commonplace as investment in the kinds of companies that make health information apps rose 78 percent in 2011 to $766 million. Qualcomm has started a $100 million fund, Insight Venture Partners is putting $40 million into a startup and Oprah Winfrey is dipping in as well, with her company investing in a website that helps doctors and patients interact. “We’re at a sea change,” said David Jahns, managing partner of Galen Partners, a Stamford, Conn.-based private equity firm that invested in a company called Sharecare. Demand for apps that let doctors and nurses see test results quickly and monitor vital signs remotely, combined with a push from government and insurers to collect better data to contain rising medical costs, is propelling investor interest in an array of health information technology, Jahns said. “We really have to improve
Today is Tuesday, June 19, the 171st day of 2012. There are 195 days left in the year
David Paul Morris / Bloomberg News
Venture capitalists are turning to startups that make smartphone and tablet apps, including this app for understanding diseases and disorders of the nervous system.
our costs,” he said. “The best thing that our country can do is invest in technology that gets better outcomes with fewer procedures.” Timothy Kreth, a cardiologist at TriStar Summit Medical Center in Hermitage, Tenn., uses an application from AirStrip Technologies that lets him view emergency room patients’ electrocardiograms on his iPhone. “It’s more convenient for the patient,” Kreth said in a telephone interview. “I can look at it and determine some of the subtle nuances the emergency room doctor maybe could not. It gives us the opportunity to make diagnoses quicker.” Kreth and the five other cardiologists have used the AirStrip technology for about
six weeks at his hospital, which is part of HCA Holdings Inc. Previously, emergency room doctors faxed cardiologists the EKGs, Kreth said. AirStrip, based in San Antonio, Texas, was the first investment from the $100 million Qualcomm Life Fund that formed in December. Qualcomm Life doesn’t disclose how much it invests, though typically puts down $2 million to $5 million, Jack Young, who manages the fund, said
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by telephone. Richard Wells, a managing director at Insight Venture, defines the burgeoning market as software as a service — scheduling technology for doctors, patient-monitoring data for hospitals and online wellness tools for corporate health plans. “In a way it’s like outsourcing,” Wells said in a phone interview. “You don’t need IT guys, it’s all done for you.” The FDA is considering stricter standards for medical apps that directly diagnose or treat conditions. The agency released draft guidelines in July that said some mobile apps pose a potential risk and may have to meet medical-device quality standards before being sold for use with smartphones and tablets.
Highlights: In 1862, Congress passed, and President Abraham Lincoln signed, a measure abolishing slavery in U.S. territories. In 1865, Union troops commanded by Maj. Gen. Gordon Granger arrived in Galveston, Texas, with news that the Civil War was over, and that all remaining slaves in Texas were free. In 1910, the first-ever Father’s Day was celebrated in Spokane, Wash. The idea for the observance is credited to Sonora Louise Smart Dodd. In 1934, the Federal Communications Commission was created; it replaced the Federal Radio Commission. In 1953, Julius Rosenberg, 35, and his wife, Ethel, 37, convicted of conspiring to pass U.S. atomic secrets to the Soviet Union, were executed at Sing Sing Prison in Ossining, N.Y. In 1961, the Supreme Court struck down a provision in Maryland’s constitution requiring state officeholders to profess a belief in God. In 1972, Hurricane Agnes, blamed for at least 122 deaths, made landfall over the Florida Panhandle. In 1986, University of Maryland basketball star Len Bias, the first draft pick of the Boston Celtics, suffered a fatal cocaineinduced seizure. In 1987, the U.S. Supreme Court struck down a Louisiana law requiring any public school teaching the theory of evolution to teach creation science as well. Ten years ago: A suicide bomber killed seven Israelis at a Jerusalem bus stop in the second deadly attack in the city in two days. The space shuttle Endeavour returned to Earth with one Russian and two American crewmen who’d spent 6½ months aboard the international space station. Rod Langway, Bernie Federko, Clark Gillies and Roger Neilson were elected to the Hockey Hall of Fame. Five years ago: A truck bomb struck a Shiite mosque in central Baghdad, killing at least 87 people. One year ago: Libya’s government said NATO warplanes had struck a residential neighborhood in the capital and killed nine civilians, including two children; NATO later confirmed one of its airstrikes had gone astray.
BIRTHDAYS Actress Gena Rowlands is 82. Singer Spanky McFarlane (Spanky and Our Gang) is 70. Nobel peace laureate Aung San Suu Kyi is 67. Actress Phylicia Rashad is 64. Rock singer Ann Wilson (Heart) is 62. Actress Kathleen Turner is 58. Singerdancer Paula Abdul is 50. Actor Andy Lauer is 49. Rock singer-musician Brian Vander Ark (Verve Pipe) is 48. — From wire reports
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