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June 19, 2006

Washington Health Policy Week in Review Archive 4fcf4b4b-66d0-4939-898b-2bc2dd0f30a8

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A Missed Opportunity with 'Mister Goodwrench' at the Ways and Means Committee

June 14, 2006 -- The House Ways and Means Committee hearing on Wednesday was supposed to be a chance to grill Centers for Medicare and Medicaid Services (CMS) Administrator Mark B. McClellan—dubbed "Mister Goodwrench" at the event because of his technical mastery of the issue—on the nuts and bolts of making Medicare prescription drug coverage function more smoothly.

But as is often the case at the committee's hearings, policy hopped into the backseat behind politics, with campaign-minded members seemingly more focused on what story line the press would take from the hearing than on the grimy details of fixing implementation glitches.

Nor did the hearing shed much light on one of its ostensible purposes—determining whether and when the committee's chairman, Bill Thomas, R-Calif., would support legislation waiving the penalty this year for late enrollment in the drug benefit.

Republicans offered up superlatives to McClellan and Department of Health and Human Services Secretary Michael O. Leavitt for the job they did implementing the benefit, which left only four million of Medicare's 43 million beneficiaries without prescription drug coverage. "It was just an amazing accomplishment," said Louisiana Republican Jim McCrery. Connecticut Republican Nancy L. Johnson said that in her 23 years on the Hill she had never seen such an aggressive effort to build a federal program. And Rep. Jim Ramstad, R-Minn., recounted how one elderly constituent expressed her gratitude for the benefit with "tears of joy."

Republicans also wasted no time blaming Democrats and the media for making enrollment more difficult. "I do want to say at the outset of the hearing that this success has come in spite of some pretty bitter partisan politics," Thomas said in his opening statement. "America's seniors have been able to see through the enormous negativity from many individuals in trying to convince anyone who would listen that this benefit is a farce. It was that negativity that the media reported on for most of the six-month enrollment period."

Arizona Republican J.D. Hayworth called Democratic carping about the benefit the result of an "ingestion of a massive dose of sour grapes."

Hayworth accused the other party of urging seniors not to enroll in the benefit—a charge much protested by Democrat after Democrat, with a number of them listing how many town meetings they held and pamphlets they distributed urging seniors to enroll.

"One example! One example!" Rep. Earl Pomeroy, D-N.D., demanded of Hayworth. "To suggest in any way that we discouraged people to sign up I think counters the facts," said Rep. Pete Stark, D-Calif. "It's a misrepresentation, it's a lie and I'm pissed about them saying [that]!" said Rep. Stephanie Tubbs Jones, D-Ohio.

But Rep. John Lewis, D-Ga., probably went farthest in disrupting any story line Republicans might have been trying to develop for the press at the hearing. Lewis told Leavitt, "I'm very concerned and really disgusted" about his reported use of a Centers for Disease Control and Prevention jet to travel to meetings around the country to promote the benefit.

Lewis called the travel public relations trips on a jet that costs taxpayers $3,000 an hour to fly. Leavitt could have used commercial airlines to travel to the events much more cheaply, Lewis said, adding that the jet is only supposed to be used for public health emergencies.

Leavitt countered that Congress authorized his use of the jet and that he also used it to travel to states to encourage planning for a potential flu pandemic. Both of those activities are worthwhile uses of the jet, he suggested, but he also noted the importance of reserving it for public health emergencies. Leavitt's office issued a statement saying that since January 11 he used the CDC jet on 19 trips to visit more than 90 cities at a cost of about $720,000. "This estimate includes the cost for other travelers on the aircraft including, depending on the trip, senior policy staff, subject matter experts, security personnel, and support staff," the statement said. The use of the aircraft "allowed him to participate in several events in multiple cities in a single business day," the statement continued. "For example, on his April 3–5 trip, the secretary would have had at least 43 hours less to perform important duties if he had not used the leased aircraft and extra travel time would have forced him to spend extra days on the road to accomplish the same events." His office said HHS checked first to see if there was a more pressing need for the jet and that "when feasible and less expensive, the secretary used other modes of travel."

When Lewis kept pressing Leavitt on the wisdom of using the jet, Johnson cut him off, saying his allotted time for questioning was over. "Regular order! Regular order!" shouted other Republicans as Lewis nevertheless persisted.

When the questioning got back to the drug benefit, Democrats emphasized that of those eligible for the low-income Medicare drug benefit who were not automatically enrolled, only one of every four have signed up for coverage. Rep. Xavier Becerra, D-Calif., said the government is paying a lot for a program in which many of the people who need help the most are not getting it.

McClellan said CMS is stepping up its efforts to enroll that population but said the administration has been more successful in its efforts than previous administrations have been in enrolling low-income Americans in assistance programs.

But Families USA Executive Director Ron Pollack claimed that the 25 percent enrollment rate means that "over five million of our neediest seniors remain without the help promised to them by Congress and [the] administration."

The National Council on Aging (NCOA), a coalition of grass-roots organizations that has helped enroll beneficiaries in the low-income benefit, has recommended new steps to target those not yet enrolled, including specialty call centers, added public and private sector funding of enrollment efforts, and more one-on-one enrollment counseling. The NCOA also urged Congress to eliminate the asset test for the low-income benefit. The test is used to limit the amount of assets a beneficiary can have and still qualify for low-income assistance.

More than half of the applications rejected for the benefit were ineligible because of failure to meet the asset test, the coalition said. "People who scrimped and saved to keep a modest nest egg but still have limited incomes should be encouraged and rewarded, not denied the extra help they need," NCOA said.

Thomas said he might hold at least one other hearing on implementation issues. "I think oversight activities are absolutely critical," he said. His inquiry is being timed to wait until the most opportune time in the congressional election season to decide on waiving the late fee, some analysts say.

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Changes to SCHIP Needed to Ease Enrollment Problems, Analysts Say

JUNE 16, 2006 -- As lawmakers consider the reauthorization of the State Children's Health Insurance Program (SCHIP), health analysts said the program should be changed to make it easier to get eligible children enrolled and reenrolled, thereby cutting down on the number of children who lose or don't have health insurance every year.

The program was created by the Balanced Budget Act of 1997 (PL 105-33) to help states provide coverage for children in families with incomes up to 200 percent of the federal poverty level. In 2004, an estimated 6.5 million children didn't have coverage, a majority of whom were eligible for either Medicare or SCHIP, according to data from the Alliance on Health Care Reform, which gave a presentation Friday on Capitol Hill.

"Coverage for kids is a critically important issue," said Matt Salo, director of the Health and Human Services Committee at the National Governors Association. And SCHIP does appear to be working. Since its implementation, fewer children have been uninsured, according to data from the U.S. Census Bureau.

A recent congressionally mandated evaluation of the program shows that low-income families who are eligible do not enroll their children for health care coverage because they don't know about it, are not sure of their eligibility, or believe the enrollment process is difficult. In other cases, sometimes the child becomes disenrolled from health care coverage without the parents' knowledge.

Laura Summer, a senior research scholar at Georgetown University's Health Policy Institute, presented four recommendations to increase the effectiveness of the program. First, Congress should mandate that the renewal process be streamlined to use information already available, instead of having the child renew from scratch. Second, children also should be required to renew less frequently. Summer cited the example of Washington State, which switched to a six-month renewal cycle and then back to a yearly cycle—the decline and then surge in enrollments was nearly 30,000 children.

Third, Summer also recommended that communication systems be enhanced to smooth the transition of various public programs. And finally, she recommended that states consider the impact of premiums, noting that in some states where premiums were required, those who failed to pay lost coverage.

Summer also noted the new requirement that Medicaid applicants provide proof of citizenship, which goes into effect July 1, will need to be taken into account for children's health care coverage. "I suspect that particular factor will jump to the top of the list," Summer said.

Stan Dorn, a senior policy analyst at the Economic and Social Research Institute, recommended a similar program to the school lunch program, where many states have implemented means-testing—where those below a certain income level are automatically enrolled to receive school lunch.

"Federal resources need to be on the table in a major way," Dorn said about the need to upgrade the Medicaid Management Information Systems to automate the process of identifying which children need support and cut down on time wasted for reassembling information.

Dorn also recommended changes to the Medicaid eligibility rules to give states more flexibility to provide health coverage when other programs have determined that a family's income is low enough.

Dorn recommended the Covering Kids Act of 2005 (S 1049, HR 3050) as an example of legislation that would give states the flexibility needed to overlook methodological differences.

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IOM Reports Highlight Cracks in Emergency Care System

June 14, 2006 -- Cracks in the nation's emergency medical care system could lead to a national crisis—especially if disaster strikes—according to three reports released on Wednesday by the Institute of Medicine (IOM).

The reports examine three topics in emergency care: hospital-based care, emergency medical services, and emergency pediatric care. According to key findings from the reports, the emergency care system in the United States faces a host of serious issues, such as overcrowded emergency departments, diversion of ambulances to other hospitals, longer patient wait times, lack of access to specialists, and a fragmented emergency response system.

On top of those concerns, many committee members at a public briefing on the reports Wednesday cited lack of preparedness for disasters—such as hurricanes, flu pandemic or terrorist attacks—as a large threat to emergency care in the United States. During committee deliberations, Hurricane Katrina struck the Gulf Coast, revealing "many deficiencies in our ability as a nation to respond," IOM President Harvey Feinberg said at the briefing.

"Every one of us here and every one of us in the country has a stake in the state of our emergency care services. . . . Yet as this series of reports makes clear, the emergency care that Americans receive can fall short of what they expect and deserve," Feinberg said.

In September 2003, IOM's Committee on the Future of Emergency Care in the United States Health System convened to conduct a comprehensive review of the issue. The 40-member committee, which also consists of three subcommittees, heard testimony from 60 individuals, wrote 11 commission papers, and held 19 meetings, resulting in the cumulative study, which cost almost $3 million. "As you can see, we've been busy over the last two years," said Gail Warden, committee chair and president emeritus of the Henry Ford Health System in Detroit.

According to IOM documents, the reports contain various recommendations for overcoming different issues within each topic. The recommendations, however, all fall under four basic themes: improving hospital efficiency and patient flow; coordinating and regionalizing the emergency care system while holding each part accountable; increasing resources; and taking into account pediatric patients while implementing these changes.

Because of differences in size, physiology, developmental stage,s and emotional needs, children respond differently to illness and injury, said Jane Knapp, professor of pediatrics at the University of Missouri, Kansas City, and a committee member. "Emergency care providers must have specialized knowledge and the equipment that they need in order to provide optimal care," she added. Another committee member, Marianne Gausche-Hill, added that many medications are prescribed off label to children because they haven't been tested or approved by the Food and Drug Administration for use in pediatric populations.

IOM documents say there is no "one-size-fits-all" solution to fixing emergency care in the United States. Several committee members called on Congress to implement various recommendations, such as establishing demonstration projects to promote regionalized care, or coverage that extends past what the committee members described as islands of excellent care in the United States. Other recommendations include increasing funding for "mission-critical" hospitals and adopting operations management techniques and health information technology in hospitals.

"This report should be alarming to the average American," said American College of Emergency Physicians President Rick Blum in a statement. "It shows that emergency departments are struggling with very limited resources in their critical role as America's health care safety net. If we are to be truly prepared for the next big disaster or epidemic or terrorist attack, we simply must get Congress to provide better support for our nation's emergency departments."

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Kentucky Governor Talks Up His Medicaid Plan

June 14, 2006 -- Kentucky Gov. Ernie Fletcher said a Medicaid overhaul plan his state plans to implement later this year will save $1 billion over seven years by dividing beneficiaries into four groups and creating different standards, benefits, and restrictions for each group. Opponents of the measure, however, say it could make some Medicaid services too expensive for beneficiaries.

The changes were made possible because of a provision in the budget bill (PL 109-171) passed earlier this year that gives states more flexibility in designing Medicaid programs and allows increased cost-savings for some services and populations.

The new rules allow states to charge premiums, create or raise copayments, and create penalties or incentives to encourage cost-saving behavior such as taking preferred drugs or avoiding emergency departments for non-emergency care.

Fletcher, a Republican, discussed Kentucky's new Medicaid plan at a briefing for reporters and health policy analysts that was sponsored by the Galen Institute, a Alexandria, Va., research group that promotes free-market health care ideas.

At the beginning of May, Kentucky was the first state approved to implement a comprehensive Medicaid overhaul plan, according to a letter from Department of Health and Human Services Secretary Michael O. Leavitt. The program, which goes into effect in late summer/early fall, divides the state's Medicaid population into four groups and treats each differently based on their needs.

The first group covers 235,000 people, including most adults on Medicaid as well as foster and medically fragile children. The second will cover 263,000 and is made up of most children in the state including State Children's Health Insurance Program beneficiaries. Kentucky officials mentioned that this group also could eventually be covered in the private insurance market with their premiums sponsored by the state.

The third group will cover 3,500 people with mental and developmental disabilities who require long-term care. In the fourth group are 27,900 people who need long-term care, including elderly individuals who require care from a nursing facility and those with brain injuries.

The program also creates certain disease management groups designed around the symptoms and treatments of conditions such as diabetes. Patients are encouraged to participate in these groups, which are more common in the private insurance market.

Finally, adults who use generic rather than brand name drugs and see a primary physician rather than going to an emergency department for primary care can qualify for coverage not available to the rest of the Medicaid population—for things such as smoking cessation, dental care, or glasses.

The consumers group Families USA predicts that the Kentucky plan will end up pricing Medicaid beneficiaries out of certain services. "The current Medicaid program only provides coverage for medically necessary care," said Ron Pollack, the group's executive director. "The cost savings are achieved at the cost of people not getting essential care."

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MedPAC Assesses Methods of Wringing Greater Value from Medicare Spending

June 16, 2006 -- With Medicare spending on a seemingly unsustainable trajectory, analysts at the Medicare Payment Advisory Commission (MedPAC) are trying to deal with the problem by figuring out how to get better value for the Medicare dollar. Tighter management of care in the traditional fee-for-service part of Medicare, measuring the levels of care prescribed by physicians, and improving the accuracy of payments to providers all hold promise toward that end, the commission said in a report to Congress on Thursday.

The MedPAC report also details how seniors decided to enroll in the new Medicare drug benefit, noting that while the enrollment process confused them, most beneficiaries felt they had enough information on which to base a decision.

The report emphasizes the larger challenge that policymakers face in Medicare. "Controlling spending is essential to assure the sustainability of the program," the report notes. "The longer action is delayed, the more draconian the remedies will be required." The tack MedPAC is now taking emphasizes avoiding wasteful expenditures; "Medicare must increase the quality and the value of the care it purchases," the report says.

Two of the main approaches MedPAC is exploring to increase value are "care coordination" in traditional Medicare and measuring "resource use" by physicians, the commission's executive director, Mark Miller, noted in a press briefing Thursday on the report.

Care coordination refers to ensuring a patient gets appropriate care in the least-costly setting—such as a doctor's office rather than an emergency room—and helping patients better manage their own conditions. While managed care plans are the vehicle in the Medicare Advantage side of Medicare that oversees care coordination, beneficiaries are overwhelmingly in the unmanaged fee-for-service side of Medicare.

Two methods can be used to coordinate care in traditional Medicare, the report says. In one, Medicare would contract with a large group practice to ensure patients go to the right settings for care or if they have complex conditions such as congestive heart failure or diabetes, that they take medications properly, and get needed checkups to keep them from developing complications that require costly hospital care.

Typically, large group practices would rely on nurse managers and information technology systems to track patients and help them better manage their own care.

The second approach targets the many beneficiaries who do not go to large group practices but rather to small or solo physician practices. Medicare could contract with separate care management organizations that have their own information technology and care management systems and can coordinate with the beneficiary's doctor. Under this model, the beneficiary would have to agree to primarily go to a particular doctor as his or her "medical home."

MedPAC's staff work indicates that care coordination in the fee-for-service sector could improve the quality of care, but whether it would reduce costs is less clear at this point, said the report.

Miller also noted that the commission seeks to improve value by making physicians more accountable for the care that they deliver. Paying them more for higher-quality care is one part of holding them accountable; another part is measuring the health care resources they consume in delivering care.

The idea is to compare doctors on the tests and procedures and other forms of care they prescribe in treating patients for a particular condition. Doctors who order more services without getting better results can be identified and prodded to practice more efficiently.

The report says that two methods of organizing data show potential for incorporating measures of resource use in Medicare, but further work needs to be done to see if they can be used to compare individual doctors on resource use as distinct as from geographic areas.

Miller noted that MedPAC is assessing whether existing medical literature can be used to compare the cost-effectiveness of various approaches for treating the same medical condition. The report finds that existing studies do not necessarily give clear answers, Miller suggested. That in turn raises new questions about using cost-effectiveness as a tool to improve value, such as how to create a system for consistently generating useful cost-effectiveness findings, how to finance it, and the roles of the public and private sector in the process.

The move toward payment accuracy reflects an attempt to ensure that Medicare's payment systems aren't skewed toward developing incentives for providers to deliver certain types of care for financial rather than clinical reasons, Miller suggested.

The report also identifies best practices in home care that could be used to develop performance measures to improve the quality of that type of care.

Using surveys and focus groups, MedPAC analysts also examined how beneficiaries learned about the Medicare drug benefit and made their choices. According to the analysts, beneficiaries relied on friends and family most often for information, but also relied on insurance agents and the drug plans. In many cases, they would identify a plan they wanted and get the literature and then make a decision on enrolling, Miller said.

Not many beneficiaries used Medicare's Web site or its 800 number, but those that did found those tools useful, Miller said. Beneficiaries found the enrollment process confusing, "but they also said they did have enough information to make a decision," Miller added. Despite predictions that beneficiaries in many cases would rely on doctors and pharmacists in making decisions, few did so, Miller noted.

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Social Security Takeover Would Boost Enrollment in Medicare Savings Programs, Report Says

JUNE 15, 2006 -- Although they might seem obscure, Medicare Savings Programs (MSPs) aren't hard to understand—through the programs, Medicare beneficiaries with an annual income below $13,000 can save $1,000 a year in Medicare premiums for doctor care, Andy Schneider told Hill aides earlier this week.

Some three million people who qualify for the programs aren't enrolled—something aides could help change, said Schneider, a former Democratic staffer who is now a consultant on Medicaid issues. "The ball is in your court," he said at a forum sponsored by the nonpartisan Alliance for Health Reform. "You can help a lot of people—a lot of people—make their lives a whole lot better," he emphasized.

A report released June 12 lays out the reasons for low enrollment and ways to boost participation in MSPs, the goal advocated by Schneider at the forum. MSPs include the Qualified Medicare Beneficiary program, the Specified Low-Income Medicare Beneficiary (SLMB) program, and the Qualified Individual program.

Although the programs differ in how much assistance they provide, they are the same in that they all help low-income beneficiaries pay the hefty out-of-pocket costs charged by Medicare. Those costs are climbing ever higher as Part B premiums for doctor care and other Medicare out-of-pocket charges rise.

Those rising costs cause low-income beneficiaries to skip treatment, said the report by the nonpartisan National Academy for Social Insurance (NASI). Yet only 13 percent of those eligible are enrolled in the SLMB program, and only 33 percent of those eligible for SLMB have signed up for that program.

A big reason for low enrollment is lack of awareness of the MSPs; of those who are eligible but haven't enrolled, 79 percent have never heard of the programs, according to the NASI report.

State Medicaid workers are responsible for enrolling Medicare beneficiaries in MSPs, but because they are so involved in applying myriad eligibility rules in other parts of the complex Medicaid program they know little about MSPs, Kathryn Kuhmerker, former director of New York State's Medicaid program, told the forum.

Beneficiaries also shy away from enrollment because they must go to Medicaid offices to do so and they associate Medicaid with welfare, she said.

The welfare stigma would be removed as an obstacle to enrollment by having the Social Security Administration (SSA) administer MSPs, the report said. Beneficiaries could go to Social Security offices to enroll, and having those offices involved would make it easier to get the word out about the MSPs, the report added.

In addition, the data SSA gathers to determine eligibility for the low-income Medicare drug benefit "could be used to help the same people enroll in the Medicare Savings Programs," the report said.

Enrollment could further be simplified by revising eligibility and income rules for MSPs to make them consistent with those of the low-income drug benefit, the report said. That step would boost federal spending, however—something Congress would be reluctant to approve, other speakers at the forum said.

There is "some logic" to focusing on getting those eligible but not enrolled in MSPs signed up before considering expansion of the MSPs, said former Assistant Department of Health and Human Services Secretary for Legislation Jennifer Young, who is now with the lobbying firm Tarplin, Downs and Young.

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