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August 8, 2005

Washington Health Policy Week in Review Archive 27197d09-21af-4d7b-929b-67c77877b42f

Newsletter Article


Grassley Introduces Long-Term Care Legislation

AUGUST 3, 2005 -- Senate Finance Committee Chairman Charles E. Grassley, R-Iowa, has introduced legislation he said would help make long-term care more affordable and accessible for older Americans and individuals with disabilities.

"This legislation would expand access to health care services, create a system that promotes home- and community-based care, empower more individuals to fully participate in community life and create incentives to help people afford the lifestyle they've worked so hard to achieve long into retirement," Grassley said in a statement. Senate Democrats Evan Bayh of Indiana and Hillary Rodham Clinton of New York are co-sponsoring the bill (S 1602).

In a July 29 floor speech, Grassley noted that long-term care can cost $50,000 a year, which forces many individuals to deplete their savings to pay the bill. When individuals cannot afford to pay, Medicaid does, Grassley said, noting that the program spent nearly $93 billion on long-term care services in 2002.

"With our aging population, one thing is clear: Spending will only increase," he said.

Among its provisions, Grassley's bill would require that states disregard benefits paid under a long-term care insurance policy when determining eligibility for Medicaid. The measure also would incorporate into the definition of qualified long-term care services a series of consumer protections recommended by the National Association of Insurance Commissioners (NAIC).

Individuals who purchase a policy that have these consumer protections would be eligible for an above the line tax deduction and a tax credit for out-of-pocket expenses made by caregivers, Grassley said. The tax credit would be phased-in over four years, starting with $1,000 in 2005 and reaching $3,000 in 2009, phasing out by $100 for each $1,000 (or fraction thereof) by which the taxpayer's modified adjusted gross income exceeds the threshold amount set at $150,000 for a joint return and $75,000 for an individual return.

The bill also would expand the long-term care partnership program that currently operates as a demonstration in four states. Such partnerships, Grassley said, combine private long-term care insurance with Medicaid coverage once individuals exhaust their insurance benefits.

In addition, the measure would give states the option of providing home- and community-based services as part of their state Medicaid plan. "In doing so, the bill gives states the flexibility to design long-term care benefits that will reduce the reliance on costly institutional settings and meet the needs of elderly and disabled individuals who overwhelmingly wish to remain in their homes and communities," Grassley said.

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New NCQA Standards Promote Wellness, Prevention

AUGUST 4, 2005 -- Fifty-seven health plans have agreed to adopt new care management standards for encouraging wellness and prevention among members, the National Committee for Quality Assurance (NCQA) announced this week.

Over the next few months, NCQA, a private non-profit organization that accredits health care organizations, will survey the health plans to assess their efforts in prevention, disease management, and complex case management.

NCQA president Margaret E. O'Kane expects most health plans will act on the ideas behind the standards in five years. The program is designed to encourage NCQA-accredited plans to achieve additional distinction as "early adopters" of the new standards before they become mandatory.

To meet the new standards, plans might recruit smokers into smoking-cessation programs or remind members who have missed routine screenings, according to NCQA.

Industry leaders predicted savings as a result of meeting the standards. Helen Darling, president of the National Business Group on Health, said in a press release that improved health care management of chronic illnesses "results in fewer sick days, fewer hospital stays, lower medical costs and...improved productivity and quality of life."

The NCQA survey also will assess the effectiveness of plans' "case management" programs, which help individuals with chronic or complex conditions determine the best course of treatment, by scrutinizing referral systems and rates of hospital readmissions and emergency room visits.

The surveys for the Care Management and Health Improvement standards, the second installment of the Quality Plus program, are set to begin Oct. 1. The first decisions will be announced during the first half of 2006.

The first part of NCQA's Quality Plus program, Member Connections, focused on how health plans used their Web sites to provide health, pharmacy, and claims information. The third set of standards, Physician and Hospital Quality, is set to launch in 2007.

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Number of Uninsured Children Down, But Too Many Still Not in Public Programs, Report Says

AUGUST 2, 2005 -- About 8.4 million children are not covered by health care insurance—about 2 million fewer than in 1998, according to a report by the Urban Institute and the University of Minnesota's State Health Access Data Assistance Center.

But 70 percent of uninsured children eligible for public programs such as Medicaid or State Children's Health Insurance Program (SCHIP) are not enrolled, according to the report, released today as part of a star-studded launch of the Robert Wood Johnson Foundation's sixth annual Covering Kids and Families Back to School Campaign.

The report also says that a third of the uninsured children had no medical care in 2003.

"The good news is that our work is paying off," said Sarah Shuptrine, founder, president, and CEO of the Southern Institute on Children and Families. She noted the drop in the number of uninsured children occurred despite the 1.2 million increase in the number of uninsured parents over the same period.
Kids have not lost coverage in the face of Medicaid cuts, Shuptrine said, because Congress has kept insuring children a priority.

"Through all these budget cuts in all the years, we have seen much less erosion in eligibility for children than you might have thought could have happened," she said. She added that covering children is "cost-effective"—kids represent half of all eligible enrollees in government programs but only 19 percent of expenditures.

Shuptrine also noted, "Minority families, especially African American families, made the greatest gains."

Nevertheless, the study found that African American and Hispanic children disproportionately lack health care coverage; 20 percent of Hispanic children are uninsured, as are 9 percent of African American and 6 percent of non-Hispanic white children.

Others noted that more still needs to be done. Risa Lavizzo-Mourey, president and CEO of the Robert Wood Johnson Foundation, said the results of uninsured rates are "crystal clear, pervasive among children in every state and completely unacceptable."

The Covering Kids and Families program is a collaborative effort headed by the Robert Wood Johnson Foundation with corporate, advocacy, public health, and government partners.

Surgeon General Richard H. Carmona, Washington D.C. Mayor Anthony A. Williams, D.C. United soccer players Freddy Adu and Jaime Moreno, and recording artists Willie Colón, Mary Mary, and Benny Cassette helped promote the initiative's campaign Tuesday. The campaign involves thousands of activities nationwide to enroll eligible children in Medicaid and SCHIP.

The Robert Wood Johnson Foundation has committed $145 million to Covering Kids and Families since 1999, according to David Morse, the foundation's vice president for communications.

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Quality Forum Endorses Quality Measures for Physician Care

AUGUST 4, 2005 -- The National Quality Forum has endorsed a set of standardized measures for gauging and publicly reporting the quality of physician care delivered in outpatient settings, the group announced Thursday.

The voluntary standards represent the consensus of more than 260 health care providers, consumer groups, professional associations, purchasers, federal agencies, and research and quality improvement organizations.

The standards could serve as tools to be used in the "pay-for-performance" movement on Capitol Hill, where lawmakers and health policy experts are eager to tie the level of provider payment to the quality of service provided.

Pay-for-performance or "P4P" means a doctor or hospital is paid more for higher scores on specific measures of performance, such as the percentage of heart attack patients who have been prescribed lifesaving beta-blocker drug therapy when they leave the hospital. Federal officials and policy wonks are touting pay-for-performance as a way to improve medical care for Medicare beneficiaries and spend federal health care dollars efficiently.

The Medicare Payment Advisory Commission (MedPAC) has urged taking about 1 percent of current federal payments to providers, such as physicians, and setting it aside for caregivers who improve the quality of their care or meet quality benchmarks.

Patients in the United States primarily receive care through outpatient services, with more than a billion visits to physician offices and hospital outpatient and emergency departments each year.

"Despite being the center of health care, there have been to this point few agreed upon quality measures specifically aimed at measuring the performance of outpatient care providers," forum officials said in a news release.

The group's board of directors approved 36 performance measures and three recommendations, all of which were vetted through the forum's formal consensus development process. The standards, the group said, represent measures of structure, process, and outcome that have been linked by evidence to quality of care for ambulatory care. Each measure also was evaluated against the forum's endorsed measure evaluation criteria of importance, scientific soundness, feasibility, and usability.

The forum is a private, not-for-profit group formed to establish consensus on health care quality performance measures and reporting.

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Study: Model Health IT Network to Require $156 Billion in Capital Investment

AUGUST 1, 2005 -- Creating a "model" national health information network would require $156 billion in capital investment and $48 billion in annual operating costs over the next five years, according to a study released Monday.

The study renews the debate over how much the federal government should contribute toward those costs.

National Health Information Technology Coordinator David Brailer was among the panel of experts that compiled the estimates. Brailer supported the Department of Health and Human Services' funding of $86.5 million in fiscal 2005 and the administration's $125 million request for fiscal 2006 to create a nationwide "health IT" network.

"I think no one's disputed that this is very expensive for the industry to do. I think the question is should the government do it," Brailer said in an interview.

Relying on tax dollars as the primary financing mechanism would be "incredibly inefficient and it comes with all kinds of strings attached and all kinds of rules and regulations that would stop us from achieving the goal" of interoperable medical records, he said.

Many health care experts and lawmakers agree that creating a national network to allow computer systems across the country to share individuals' medical information—with the proper confidentiality protections in place—could help improve medical care while reducing costs.

Researchers say the study, published in the Aug. 2 issue of the Annals of Internal Medicine, is the first of its kind to model and estimate the cost of implementing a national health information network (NHIN) across the country.

Brailer helped develop the financial model on which the estimates were based. But he said he thought the numbers were somewhat high and that other studies are needed.

Authors Rainu Kaushal of Brigham and Women's Hospital and David Blumenthal of Massachusetts General Hospital and their colleagues estimate that two-thirds of the $156 billion estimate for capital investment would be spent annually on getting such systems up and running, while one-third would be spent on interoperability, which would allow such systems to share information.

Annual operating costs would be more evenly divided, with about $27 billion spent on functionalities and $21 billion on interoperability.

If the current trajectory of information technology adoption continues, the health care system will spend about one-quarter of the costs of the functionalities of a model NHIN and probably not even begin to address issues of interoperability, the authors wrote.

"These findings suggest that policy initiatives are needed if we are to close this gap," the authors note. "Clearly the implementation of an NHIN will be expensive."

Often those costs are incurred by a few players in the health care system while the benefits accrue to many. For example, the authors note, hospitals pay the cost to install computerized physician order entry systems although financial benefits from such investments accrue to many. Since institutions tend to invest in areas where they may see a direct financial benefit, "it seems unlikely that the private sector will move forward rapidly to adopt IT without public sector investment or incentives, both in terms of money and leadership," the report says. But the risk is that public dollars will substitute for private dollars invested in health IT over the next five years, the authors add.

An editorial published in the same issue of the Annals of Internal Medicine notes that "the federal government has not shown the willingness or ability to invest more than a fraction" of what the study's authors say is necessary to create health information technology and electronic health records.

The study was funded jointly by the Harvard Interfaculty Program for Health Systems Improvement and The Commonwealth Fund.

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