e-Issue #553 | July 25, 2006
Private Sector, State Governments Recommend More Home and Community-Based Care at Aging Committee Hearing
Medicaid Suggested as Proving Ground for Broader Health System Change
Already having overtaken Medicare as the nation's largest health care program, Medicaid's spending levels are projected to double within 10 years, and both the public and private sectors are discussing and
implementing ways to prevent that from happening. Donald B. Marron, acting director of the Congressional Budget Office (CBO), recently told the Senate Special Committee on Aging that individual states ought to be encouraged to use lower-cost health care services, citing a need to increase home and community-based care. One of every three dollars spent on Medicaid this year will go toward long-term care -- including nursing home services, home health care, and other medical and social services -- for people with chronic disabilities, according to CBO.
Committee Chairman Sen. Gordon Smith (R-Ore.) noted that although the expansive growth of the 65-plus population is inevitable, steps can be taken to manage this age group's health care in a wiser and more efficient manner. The health care system as a whole needs reform, Smith said, adding that the best place to start is Medicaid spending. Marron suggested greater utilization of home and community-based care alternatives to nursing home care, since the former usually cost significantly less than does institutional care. Long-term care costs, particularly for nursing home care, are a major and disproportionate expenditure within the Medicaid program, he observed. "Although 75 percent of Medicaid enrollees are children and their parents, 70
percent of spending for benefits goes toward care for the program's elderly and disabled enrollees," Marron said. "[Medicaid] finances about two-thirds of all nursing home stays by the time of a patient's discharge."
In a "catch 22" commonly attached to home and community-based care, CBO observes that this type of care is significantly more appealing to seniors and other beneficiaries compared with
institutional care, which due to its lesser appeal features a type of built-in utilization deterrent. CBO cautions that the demand for
community-based services is much greater than that for institutional care -- so if eligibility for alternative services were expanded to more people, these services would likely substitute for informal care
provided in the home by family members. "If the expansion [of home care services] was not well targeted, the costs of meeting that
increased demand for [home] care could exceed the savings that might be generated by substituting community-based care for nursing home care," Marron said.
One state that has addressed this issue is Arizona, according to Gov. Janet Napolitano (D), who also spoke during the committee's hearing. The state enacted a Medicaid waiver program that allows more people to be placed in home or community settings (NAHC Report 3/3/06), eliminating concerns of increasing this population too sharply by
applying a "rigorous medical eligibility tool."
Napolitano said the Arizona Health Care Cost Containment System (AHCCCS) -- the state's version of Medicaid -- provides "a robust, cost-effective model for other states as they and the federal
government seek alternative models that can sustain the Medicaid program." The program has turned up several "best practice" areas for containing costs, including controlling prescription drug costs and
expanding home and community-based options for Medicaid
beneficiaries who would otherwise have to obtain long-term care in a nursing home.
AHCCCS includes managed care plan options, under which managed care organizations are paid a fixed amount per enrollee per month to cover medically necessary care. According to Napolitano, this "full risk" contracting creates flexibility in the benefit, and each participant's case is managed individually "in order to avoid expensive hospital and
institutional care and replace it with home and community-based services." Napolitano added that Arizona is the only state to offer managed care options to all long-term care recipients and
Medicare/Medicaid dual eligibles, characterizing this as "the best model for integrating all necessary care with a personalized case manager." Representing a private sector company that has wrestled with
measures to control health care costs, G. Richard Wagoner Jr.,
chairman and CEO of General Motors Corp., contended that "corporate America and our state governments can learn a lot from each other on this important topic." He described several "innovations" that GM has employed to help manage health care costs for its 1.1 million
of health care in the United States, Wagoner noted that GM spent $5.3 million for health coverage last year.
"The most important key to keeping health costs down and to keeping your beneficiaries out of hospitals is to keep them healthy or improve their health status," said Wagoner. GM built in-house fitness centers for its employees and also offers a discount fitness network for those who would rather exercise at a location separate from work. The company focuses on cancer prevention, diabetes prevention and
management, improving heart health, and educating employees to use tools designed to help them become better health care consumers. "It's troubling that consumers know more about a potential vehicle than they do about the doctors they see, the hospitals they may visit, or the prescription drugs they may take," Wagoner stated. Expanding so-called "consumer-directed" health coverage options, GM began offering employees a choice of two high-deductible health plans that include health savings accounts (NAHC Report 7/24/06).
At the federal level, CBO plans to examine the effectiveness of provisions of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, or MMA, and the Deficit Reduction Act of 2005, or DRA, to determine whether they actually reduce spending. That will include consideration of:
--The Medicare Part D benefit;
--Greater coverage for certain disabled children;
--Expanded access to home and community-based services, and --The "Money Follows the Person" demonstration project.
"It is too early to tell how their actual effects will compare with earlier estimates," Marron noted of the provisions, "and the federal
government has several avenues by which it might reduce the growth of Medicaid's spending." Marron added that individuals should be encouraged to purchase long-term care insurance as part of planning for their retirement. "People who buy private [long-term care]
insurance substantially reduce the probability that they will ever qualify for Medicaid benefits," he said.
Go to
etail&PressRelease_id=547&Month=7&Year=2006 for more information on the hearing.
HHS Announces First Certifications of Electronic Health Record Products
Seal Shows Products 'Functional, Interoperable, Bring Higher Quality Care,' HHS Secretary Leavitt Says
In its latest move to help foster nationwide electronic health records (EHRs), also referred to as electronic medical records (EMRs), the Department of Health & Human Services (HHS) has announced the certification by national standards of a first round of products designed for ambulatory and outpatient care. This seal of certification "gives health care providers peace of mind to know they are purchasing a product that is functional and interoperable and will bring higher quality, safer care to patients," HHS Secretary Mike Leavitt said in a statement. The certification process will be expanded in phases by the Certification Commission for Healthcare Information Technology
(CCHIT), the HHS contractor to develop national standards for certification.
CCHIT, a private nonprofit organization, won a $2.7 million contract in September 2005 to develop "an efficient, credible, and sustainable mechanism for certifying health care information technology products," according to HHS. The certification process is part of HHS's ongoing efforts to get EHRs operating -- or more specifically, interoperating -- across the nation by 2014 (NAHC Report 7/5/06), as called for under a 2004 executive order issued by President Bush.
The phases by which CCHIT plans to implement its product certifications are:
--Outpatient/ambulatory EHRs, --Inpatient/hospital EHRs, and
--EHR "architectures" and systems that facilitate the exchange of information among health care providers.
"Our country paradoxically lags many others in the adoption of health care information technology -- computer systems and networks that can manage patient information, enhance team and patient
communication, support evidence-based decision-making, and help prevent medical errors," CCHIT Board of Commissioners Chairman Mark Leavitt, MD (no relation to the HHS Secretary), contended at a recent Senate hearing. To obtain CCHIT certification, EHR products must meet standards for basic functionality, interoperability, and security.
On a related note, HHS says it plans to finalize rules creating safe harbors from federal anti-kickback statute and exceptions to physician self-referral restrictions regarding the national health IT adoption
efforts. The exceptions will allow health care providers and suppliers to make "donations of health information technology that may not have been permitted before." Generally, according to the proposed
exception and safe harbor rules, these donations are limited to
hardware and software and the training to use them that is necessary to an aspect of EHR operation:
"For example, under the proposed regulations, a donor can provide a hand-held device capable of transmitting electronic prescribing
information to the recipient, even if the recipient already has a desktop computer that could be used to transmit or receive the same
information, because the mobility allowed by the hand-held device offers a material advantage over the desktop computer for recipients who would use the device portably. By contrast, the provision of a second hand-held device would not qualify for safe harbor protection if the Recipient already has a hand-held device sufficient to run the requisite electronic prescribing software."
...
"These exceptions are consistent with the President's goal of achieving widespread adoption of interoperable electronic health records for the purpose of improving the quality and efficiency of health care, while maintaining the levels of security and privacy that consumers expect." The companies that have been granted EHR certification in this first round (and their specific products that have been
certified) are:
--Allscripts: HealthMatics Electronic Health Record 2006, TouchWorks Electronic Health Record 10.1.1
--Companion Technologies: Companion EMR v8.5
--eClinicalWorks: eClinicalWorks Version 7.0 Release 2 --Emdeon Practice Services: Intergy EHR v3.00
--e-MDs: e-MDs Solution Series 6.1
--Epic Systems: EpicCare Ambulatory EMR Spring 2006 --GE Healthcare: Centricity EMR 2005 Version 6.0
--JMJ Technologies: EncounterPRO EHR 5.0
--McKesson: Horizon Ambulatory Care Version 9.4
--MCS-Medical Communication Systems: mMD.Net EHR 9.0.9 --MedcomSoft: Record 2006 (V 3.0)
--Medical Informatics Engineering: WebChart 4.23 --Misys Healthcare Systems: Misys EMR 8.0
--NextGen Healthcare Information Systems: NextGen EMR 5.3 --Nightingale Informatix Corp.: myNightingale Physician Workstation 5.1
--Practice Partner: Patient Records 9 Visit www.cchit.org for more information.
