1st Salvo in Obamacare 2011: National Health Care Transformation Demonstration Project

I caught this when I took a look at: Healthcare Reform 101 -What will kick in January 1, 2011 CNS Monitor. Coming to your Doctor’s office soon. This is how you will be treated.

The innovation mentioned rang a bell. Yes, Pennsylvania is one of the States in the demonstration project. The first arrow has been slung. And Pennsylvania is one of the first recipients. I could find no accurate review of the downside, so bear with me as I give it a shot.

What will take place is a Capitated payment for each patient. A flat reimbursement is paid to take care of each patient. A “Capitated” Life. Don’t you just love it? No more fee for service. So a medical group gets a certain amount of money to take care of each patient and it is up to them to “divvy” the money up among any specialists.  Now here is the catch. They do the deciding if the patient requires more specialized care. If they do, the money comes out of their pocket.  The other option  simply keep the whole money thing. Don’t refer the patient out and do the best they can. No heart specialist, Orthopedist, Diabetes specialist, Asthma specialist. Anything clicking?? Not to get bogged down in the weeds, but keep an eye out on this one. There is more to this, but let’s leave it here for now:

Capitated basis is defined as “fixed per member per month payment or percentage of premium payment wherein the provider assumes the full risk for the cost of contracted services without regard to the type, value, or frequency of services provided.” G. v. Hawaii, 2009 U.S. Dist. LEXIS 92504 (D. Haw. Oct. 2, 2009)

• Center for Medicare and Medicaid Innovation. This center, which aims to test new ways of delivering care to patients that reduce costs but maintain or improve quality, was to be established by Jan. 1. But it’s already up and running and has launched multiple initiatives. In one, eight states will take part in a Medicare demonstration project that evaluates the performance of health-care providers when they work together and receive more-coordinated payments.

“For too long, health care in the United States has been fragmented — failing to meet patients’ basic needs and leaving both patients and providers frustrated,” Donald M. Berwick, MD, Centers for Medicare & Medicaid Services administrator said during a Nov. 16 conference call that included the AMA president. “Payment systems often fail to reward providers for coordinating care and keeping their patients healthy, reinforcing this fragmentation.”

He said the innovation center will help change this trend by identifying, supporting and evaluating models of care that both improve the quality of care patients receive and lower costs. AMA

EGMN: Some of the concepts – such as medical homes and capitated payments – have been tested before. What makes this effort different? Don’t count on it being any different!

Mr. Guterman: Capitation was tried in the 1990s, but the world was a different place then. In the 1990s, we didn’t have the kinds of measures of health system performance that we have now. Also, the notion of capitating payments so that you provided a strong incentive to reduce costs got separated from the notion of providing care in an effective, efficient way. So we started out with a managed care movement that was focused on providing coordinated care for patients and we ended up with a movement that was focused primarily on reducing the costs, sometimes in arbitrary ways. Today, I think we have the tools to avoid going off that track. We may not get all the way to capitation, but there are bundled payments and other strategies that get us away from the current fee-for-service system.

Internal Medicine News

Governor Edward G. Rendell today announced that as part of national health care reform, Pennsylvania is one of eight states selected by the federal government to join a demonstration project to improve treatment for people with chronic diseases – a major driver of health care costs.

It could also bring as much as $33 million in additional Medicare funds that will result in better health outcomes and lower net health care costs.

“Pennsylvania has been a recognized leader for our ongoing work in transforming primary care and addressing chronic health conditions,” Governor Rendell said. “Being selected by the federal Centers for Medicaid and Medicare Services to join this demonstration project is evidence of the success the Pennsylvania Chronic Care Initiative has had — and will continue to have — as we reform our health care system.”

In the Chronic Care Initiative, practices learn to use electronic disease registries to identify patients who have skipped appointments or are not improving and to monitor progress on key clinical outcome measures. Support staff learn to work as a team to make sure patients receive lab tests, specialist care and referrals to community agencies they need while also helping patients learn how to better manage their own health. These steps result in healthier, more-satisfied patients as well as fewer hospitalizations and emergency room visits.

Pennsylvania’s commercial health insurers and Medicaid are heavily involved in the Chronic Care Initiative, contributing $30 million over the initial three years of the project to compensate practices for the extra costs of adding care managers and gaining recognition as a Patient Centered Medical Home.

PR Newswire

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