Earlier this month I published a survey of the cost of insulin to the Medicaid and Medicare programs of Kentucky and the nation. Fully 9.1% of the total cost of Kentucky’s outpatient Medicaid drug program went to pay for the several brands of Insulin still available. It was obvious that some brands cost a lot more per prescription or claim than others and that the most expensive brands were prescribed most often! I used this critically important drug as an example of how the market for prescription drugs in America is badly broken. Since then I stumbled on two additional federal databases that provide additional insight into how much these drugs cost at the local pharmacy counter where the rubber hits the road. These are federal surveys that determine the National Average Retail Prices paid by the consumer (NARP), and the National Average Drug Acquisition Cost (NADAC) for the pharmacy. Both these programs provide data at the cost per milliliter level, and otherwise facilitate apple-to-apple comparisons of the different brands. In brief, the additional data confirm that in 2013, for the same size bottle, the newer insulin analogs cost 71% more than the older “human” insulins. By 2015, all prices had increased; some substantially. Valuable information about the retail prices of drugs is being kept from public inspection. Continue reading “Update On The Rising Prices of Insulin Between 2013 and 2016.”
Discovered and patented almost 100 years ago, insulin is a critical drug for the treatment of both childhood Type I and adult onset Type II diabetes mellitus. Diabetes is a costly disease for our society in more ways than one. In 2015, the cost to the Kentucky Medicaid program for insulin alone annualizes to $101.8 million. Insulin consumed 9.1% of Kentucky Medicaid’s entire non-hospital drug expense while making up only 1.1% of all prescriptions. In 2013, the last year in which Medicare Part-D drug utilization data are available to me, insulin consumed 7.3% of total Medicare reimbursement for drugs in Kentucky costing a total of $141.8 million. In both federal programs, insulin consumed a larger portion of the drug budgets in Kentucky than nationally. A review of several reasons why insulin has become so expensive illustrates what is very wrong with our national drug policy. Continue reading “Soaring Insulin Prices Highlight Broken Pharmaceutical Policy.”
My cup runneth over with potential issues to explore.
June has been a busy month both locally and nationally insofar as things I like to write about. The shame-on-me is that I have not carved out enough time to do so! In part I am still picking up the pieces after my early spring travels. Exploring how to unpack and deal with the new Medicare prescription drug data base also took a lot of time. The truth is that I am a slow writer handicapped by a default and probably over-wordy professorial style. I haven’t even been able to update the Institute’s Facebook and Twitter pages! What follows is a list of things that occured during the month that I wanted to write about and hope to do so in more detail later. These are not necessarily in chronological order or of importance.
The Supremes Rock & Rule!
We were presented with two back-to-back major decisions by the U.S. Supreme Court. The first, King v. Burwell, allows federal subsidies of health insurance premiums for low income individuals and their families to continue even if their insurance was purchased in states that chose to allow the federal government to operate their health insurance exchanges. The lawsuit brought by Obama/Obamacare-haters to limit premium support to insured individuals in states like Kentucky that chose to operate their own exchanges would have essentially gutted the Affordable Care Act (ACA) and tossed millions back into the uninsured category. For the time being, Obamacare stands intact for at least the next year and a half, despite promises by opponents to throw up additional challenges. All our legislators should be working together to deal with a major remaining deficiency of the ACA. The Act has been very successful in decreasing the number of uninsured people, but it makes little headway against the exploding costs of unnecessary, marginally effective, or for that matter even necessary medical care. Continuing to forbid the federal government to negotiate over the prices of drugs is a case in point. Subsidies were deemed necessary for a reason! Continue reading “Potpourri of Health Policy Issues in June.”
It is easier to give than to receive in the transplant world.
In a comment added to a recent article about the current financial status of Catholic Health Initiatives (the parent company of KentuckyOne Health) it was alleged that Jewish Hospital in Louisville did not accept Medicaid patients for organ transplantation. Because of the seriousness of this allegation, I was reluctant to allow it to stand without further comment. I therefore did some research and elicited comments from involved parties. The results trouble me and highlight yet another major example of the disparity of access to health care in our inherently unfair non-system, dividing Americans as it does by socio-economic status. In the case of transplantation, the operational result is particularly ugly, because the weight of government regulation and community has given us a morally indefensible result analogous to the rich stealing organs from the poor. I call this an example of the “Reverse Robin Hood” nature of America’s National Health System! Neither Jewish Hospital nor UofL are responsible for this situation, but have benefited from it. Continue reading “Financial Status a Barrier to Organ Transplantation But Not Donation.”
Since my initial exploration of Medicare’s Physician Payment Database, I have not done much with it. The expectation that the information would be of great interest to many has been validated, and the utility and shortcomings of the data better understood. The potential is great that these data can be used to improve the quality, affordability, and availability of medical care. As might have been predicted however, a great deal of attention has been focused on identifying medical malfeasance and fraud.
I have always been of the opinion that examination of outliers in big data sets like this one is extremely valuable in health policy research. This is especially true in American medicine where there is such great variation both in the frequency in which various medical services are provided, and the amount of money charged. Looking at outliers does not automatically assume that something inappropriate is going on. A place or provider where a large number of things are being done may be a center of recognized excellence. On the other hand, and as we have seen in this series of articles, such “hotspots” of activity may represent inappropriate, abusive, or even illegal medical practice. I believe that large utilization data sets like this one beg us to ask questions about how to use our healthcare resources fairly, efficiently, and most of all effectively. A strategy I recommend is to start by looking more closely at the top 10 and the bottom 10 on any such list. Is that entry there for the best of reasons to be emulated, or for reasons of less value to be corrected? When you are done with the top ten, go on to the next, and so on. Continue reading “Medicare Payments to Oncologists in Kentucky.”
Surprises, Disappointments, Confirmations, and Puzzles.
Most would agree, that transparency and accountability are in general, desirable. It does not necessarily follow however, that disclosure of previously hidden, obscure, or obtuse information arrives free of embarrassment for some or confusion for others. So it is with the recent unprecedented release by the Centers for Medicare and Medicaid Services (CMS) of the volume and cost of many of the services provided to some Medicare beneficiaries. Bothe the professional and lay media is fully energized with attempts to explain, excuse, or otherwise draw meaning from this voluminous and difficult-to-embrace set of data. Frankly, I have been rewarded with both surprise and disappointment, and with the satisfaction of solving puzzles. Clearly there is information here that both the professional and lay public must address if we are to benefit from a fair, effective, and efficient system of healthcare.
Ranking of Provider Types and Payments.
As a first step, I have broken down the 9+ million-item database by type of provider. There are 89 different types identified. (View the list here.) I attach 4 different PDF documents summarizing the same data in different views sorted by provider type, the number of individual providers in each provider type, the aggregate Medicare payments to each type, and the average payment for each provider of a given type. Please remember that there are many caveats attached to this data that must necessarily limit the conclusions that might be drawn. These are discussed by me in earlier articles of this series, and by others. Be that as it may, the view from 40,000 feet is instructive and shows us where to target more detailed analysis. Continue reading “Medicare Payments to Physicians and Other Providers: Analysis by Type of Provider.”
Both aggregate and detailed data for Kentucky and Louisville available for download below.
Its out there!
The release last week by the Centers for Medicare and Medicaid Services (CMS) of services by and payments to physicians and other non-hospital providers reverberated as expected throughout the nation. Analysis of the massive database is, and will continue to expose the complexity, quirks, inequities, fraud, and sometimes just plain bizarreness in our current health care system. Some large media outlets such as the New York Times, the Wall Street Journal, and the Washington Post were allowed to organize and work with the data before it was released to the general public. Both these sites and perhaps others allow the public to look up individual providers, but comparisons of individuals or groups is cumbersome to impossible. Furthermore, neither of these two portals to the data includes all non-physician providers. In any case, a host of individual providers or professional groups are now scrambling to try to explain why they stick out like sore thumbs in terms of frequency of services, charges, or payments from Medicare.
Eye doctors (and others) under the magnifying glass.
For example, ophthalmologists point out that the reason they receive among the highest payments is that they frequently inject an extremely expensive drug into the eyeball. While this may be rational and honest defense, it is not a reasonable one if, as is reported, it is true that a spectacularly cheap alternative generic drug works just as well. Thus, the issue of how much money a physician or other provider is entitled to make off a drug they chose to administer themselves is certain to enter public debate. Continue reading “Analysis of CMS Release of Medicare Provider Payments Begins!”
Take a look at the results for Louisville and Kentucky.
Our colleague Terry Boyd at Insider Louisville was probably the first out of the block this morning to report on the local results of the much-debated, long-opposed, and likely system-changing publication by the Centers for Medicare and Medicaid Services of the amounts of money charged by and payed to individual physicians and other providers for some Medicare patients. This previously top-secret financial and utilization information had not even been available to other physicians let alone the public.
Long opposed by organized medicine as a violation of individual physician privacy, the public has gotten used to, indeed gained an appetite for such information about hospitals, nursing homes and the like. This is part of the movement to increase medical safety, quality, and efficiency. It also has been very helpful for identifying medical fraud and abuse. I predict that the release of physician payment data will have as much earth-shaking effect as last year’s release of hospital payment data illustrated by the now-famous article in Time Magazine, “Bitter Pill: Why Medical Bills Are Killing Us,” by Steven Brill.
There will be much to learn from this extensive database. It is huge! My tricked-out Mac chokes on the size of it. You can look up individual physicians for a more detailed breakdown on the Washington Post Portal referred to by Terry Boyd, or the Wall Street Journal.. To give the community something to look at while I do the same, a more manageable aggregate list of all the physician and other non-hospital Medicare providers doing business in Louisville or the state of Kentucky is available below. I have ranked the lists by the amount of money actually paid to individual providers– highest paid providers are at the top. Definitions of the individual items and some other comments about the data are present in the designated tabs. Continue reading “Medicare Payments to Physicians Now Available On-Line.”
Finally some real data.
On April 5, the Ad Hoc Operations review committee of University Medical Center, Inc. (UMC) met for the third time. This was the first meeting in which substantive analysis was presented by the consultants of Dixon Hughes Goodman. Unfortunately, Committee attendance continues to dwindle. Only five of the 10 committee members attended, one of those by telephone. In the
peanut public gallery were myself, reporter Patrick Howington, and someone from Brown-Forman. One additional meeting before a final meeting on May 9 is planned.
The entirety of the meeting was a PowerPoint presentation by the consultants with only a few questions and comments from committee members. No handouts were presented as the material was said to be a work in progress. I could not help but suspect there was also some desire that the information not be disseminated. Indeed, most of the data presented must have been disappointing to the University. In any event, I photographed the projected slides and they are available here.
Senior consultant Craig Anderson, Sr. gave an update on the status of the project and lead his team of two additional people through a brief review of the challenges facing all academic medical centers (AMCs), some themes and observations from initial interviews with Hospital and University personnel, and some initial data addressing four of the hypotheses to be tested: lack of physician alignment, quality of clinical care and operations, payer environment, and facility constraints. Continue reading “Third Meeting of UofL Hospital Operations Review Committee.”
Let’s look at some numbers.
The University of Louisville is going to try and make a case that it has unique requirements that will require additional non-patient revenue to fix. Specifically, they are asking for more state money, or alternatively, permission to partner with an outside business entity that is willing to give them more money. The claim will be made they are caring for a disproportionate share of nonpaying patients, and do not have enough profitable patients to subsidize the losses the way other hospitals do. This is a reasonable argument to make but it is an incomplete one. The University’s problem will not be fixed by money alone. There are a host of other issues that must be addressed simultaneously. I have begun to discuss these elsewhere.
There are 3502 acute care hospitals that participate in the Medicare program. Of these, 1047 are teaching hospitals, and 601 are large urban teaching hospitals like the University of Louisville Hospital. It would be easy for the University or its consultants to pick and choose hospitals to compare with that would bolster its case. Picking your own benchmarks is one way to make yourself look good, or in this case bad. Much of the University’s credibility will hinge on the choice of comparable institutions. Fortunately, there is an ocean of comparative data available that I believe helps put things in perspective and can provide a starting point for a broad-based study of our medical school and its principal teaching hospital. I will try to present such information on the Institute’s website. Such analysis often challenges popular wisdom.
For example, teaching hospitals get billions of dollars of special funding from Medicare (and Medicaid) solely because they have medical residents on their wards. These Direct and Indirect payments for Graduate Medical Education (interns and residents) increased substantially over the years as a result of effective lobbying. It was argued from the start that teaching hospitals deserve more money because they have extra expenses related to faculty salary, inefficiencies of care, and for other reasons that may or may not be relevant today. Federal analysts estimate that Medicare pays teaching hospitals twice as much for graduate medical education than the actual cost of those programs to the hospitals. Not to be denied, the teaching hospital lobby continues to argue that they are entitled to the extra money because of their disproportionate service to the poor. Is it in fact true that teaching hospitals take care of more of the poor than non-teaching hospitals? I was frankly surprised when my first attempt to find out showed that in fact, the proposition does not appear to be true. Continue reading “How does UofL hospital compare to other hospitals?”