Challenge of Transforming Our Private and Public Pediatric Health Care Systems to Emphasize Value

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COMMENTARIES

Opinions expressed in these commentaries are those of the author and not necessarily those of the American Academy of Pediatrics or its Committees.

Challenge of Transforming Our

Private and Public Pediatric Health

Care Systems to Emphasize Value

ABBREVIATIONS. HEDIS, Health Plan Employer Data and Infor-mation Set; VZV, varicella-zoster virus; OR, odds ratio; CI, confi-dence interval.

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wo articles in this issue ofPediatrics1,2_provide additional evidence that our health care system is not functioning appropriately in the private or public sectors and needs to undergo a major trans-formation that focuses on value: enhancing quality while controlling expenditures. Most children in the United States have either private employer-based (commercial) health insurance or public health insur-ance through Medicaid or the State Children’s Health Insurance Program. In the private sector, pay-ments for physician services (and other medical ser-vices) are determined by market forces with minimal or no government regulation. Payments usually are based on contracts between payers (the health plans) and physicians who deliver the services. Unfortu-nately, individual and small groups of pediatricians often lack the ability to negotiate with large for-profit health plans effectively. A central tenet of a private health care system is that quality per unit of cost will be maximized by having a competitive market de-termine the prices of medical services based on sup-ply and demand. Demand should be based on qual-ity per unit of cost, which is value. When the value of a service is high, demand should create a financial incentive to provide the service. How well is this private health care market system working to ensure that children are receiving recommended preventive care and immunization services? This is an impor-tant question, because our society benefits from wide-scale immunization; whole communities are protected, including individuals who are not vacci-nated.

McInerny et al,1 _{from the American Academy of} Pediatrics, published a study in this issue of Pediat-rics that addresses this question by examining the relationship in the commercial market between state-level physician payments for primary care services including immunizations with visit rates and up-to-date immunization rates. State-level payments were determined by using the Reden and Anders’ national actuarial database. State-level preventive care visit rates and up-to-date immunization rates were deter-mined from the Health Plan Employer Data and Information Set (HEDIS) for children in 32 states. It is unfortunate that these state-level HEDIS measures were simple averages of the health plans that re-ported results not weighted by relative enrollment; this means that the reported average may not reflect statewide measures accurately, because substantial variations exist among health plans in both HEDIS measures and enrollment. More accurate informa-tion would be obtained by analyzing plan-level re-imbursement information with patient-level out-comes. However, the findings are noteworthy because they consistently show that states with bet-ter payment rates for primary care services are more likely to have higher rates for both immunizations and preventive care visits. A significant correlation was found between state-level commercial reim-bursement levels and 5 immunization-related HEDIS measures (childhood immunizations with Haemophi-lus influenzaetype b [r⫽0.35], hepatitis B [r⫽0.42], combined immunizations without varicella-zoster virus [VZV] [r ⫽ 0.42], adolescent immunizations with VZV [r ⫽ 0.53], and combined adolescent im-munizations with VZV [r⫽ 0.43]) and 3 preventive care visit HEDIS measures (having ⱖ6 preventive care visits during the first 15 months of life [r⫽0.44], an annual preventive care visit for children 3– 6 years old [r⫽0.46], and preventive care visits for adoles-cents [r⫽0.42]).

These findings should not be surprising, because reimbursement below overhead costs for preventive care services and especially for immunizations re-sults in a financial disincentive to provide these ser-vices. What is surprising and disturbing is that pe-diatricians now must bear the substantial up-front and inventory-maintenance costs of vaccine pur-chases when health plan payments are less than the costs of vaccine administration3_{and barely cover the} vaccine costs. This financial disincentive reduces the likelihood that physicians will invest in system en-hancements such as personnel and information sys-tems to improve the delivery of preventive services and immunizations, the most cost-effective form of preventive care.

Why is the market not functioning well with re-spect to immunizations and preventive care, and

Accepted for publication Jan 26, 2005. doi:10.1542/peds.2005-0189 No conflict of interest declared.

Address correspondence to Stephen Berman, MD, FAAP, Children’s Hos-pital, 1056 E 19th Ave, B032, Denver, CO 80218. E-mail: berman.stephen@ tchden.org

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why is increased government regulation needed to promote well-functioning competitive markets in health care? Markets usually function poorly when there are unfair practices including fraud, inappro-priate risk, or unfair/monopolistic practices. Regula-tion that addresses the current unfair market prac-tices of health plans and promotes financial incentives to provide childhood preventive care and immunizations would be in the public good and should be considered by policy makers at the state and national levels. Another reason for increased regulation is to ensure adequate consideration of the public good and protect vulnerable populations from abuses. For example, sectors of the society that are too important to be left to market forces include the military, safety sector (police and fire departments), and public health.

However, public health programs, especially Med-icaid, also have significant problems with quality and value. Another article published in this issue of

Pediatricsby Smink et al2_{addresses problems in} pub-lic health care systems that may be related to the consequences of inadequate physician payments in Medicaid. This study, using a 1997 pediatric inpa-tient database form 22 states, presents the results of a multivariate analysis of perforated appendicitis among 33 184 children with acute appendicitis. Per-forated appendicitis rates can serve as a marker for access to primary care, because the risk of perfora-tion increases when diagnosis and surgical treatment are delayed. The study seeks to help us better under-stand to what extent increased rates of perforated appendicitis are related to restricted access to pri-mary and specialty care or lower quality of care versus differences in care-seeking behavior, sociode-mographic characteristics, and other factors related to a genetic predisposition. Unlike 2 prior published studies of perforated appendicitis in children,4,5_this study was conducted on a nationally representative database from the Healthcare Cost and Utilization Project and used multivariate-regression techniques to adjust the outcome for insurance status, race, gen-der, age, and hospital characteristics including vol-ume of appendectomies, location, and teaching sta-tus. Adjusting for these variables, perforation was still more likely in black (odds ratio [OR]: 1.24; 95% confidence interval [CI]: 1.10 –1.39) and Hispanic (OR: 1.19; 95% CI: 1.10 –1.29) children compared with white children, as well as in Medicaid-insured (OR: 1.30; 95% CI: 1.22–1.39) and uninsured (OR: 1.23; 95% CI: 1.12–1.35) children compared with privately in-sured children. Hospital characteristics (teaching sta-tus, location, and volume of appendectomies) were not significantly associated with perforation. It is important to understand why black and Hispanic children who develop appendicitis should have higher perforation rates. Many reasons related to race/ethnicity are possible, such as communication difficulties, discrimination, and care-seeking behav-iors. It is unfortunate that this study, as the authors point out, could not determine reasons for this dis-parity. Several sites on the care continuum that could be affected include delays in seeking care as well as

delays in diagnosis, referral, and surgical interven-tion. These findings suggest that having a Medicaid card does not ensure that the enrollee will receive high-quality care, have a primary care physician (medical home), and easily be able to see a specialist. It is likely that Medicaid enrollees as well as children without insurance have restricted access to primary and possibly specialty care, which contributes to higher perforation rates. A reduction of perforation rate within the Medicaid population to the rate ob-served in privately insured children would result in significant financial savings aside from a reduction in pain and suffering resulting from perforation in children. The mean total hospital charges in the chil-dren who perforated were $14 122 compared with $6846 for children without a perforation. Based on a national estimate of 70 000 children having appendi-citis with a similar distribution of Medicaid and pri-vate insurance as reported in the study, the esti-mated hospital-charge savings associated with a reduction of the perforation rate of Medicaid-insured children to the rate of privately insured children would be $46 130 640.

The most influential reason that access to pediatric primary and specialty care is compromised for chil-dren with Medicaid is low payment for services, especially to physicians in private practice. Through-out much of the country, Medicaid patient visit pay-ments fail to cover the overhead expenses per visit exclusive of physician compensation. As a result, the willingness of primary care and pediatricians and family physicians as well as pediatric medical sub-specialists and surgical sub-specialists to accept children with Medicaid into their practices is diminishing, and access to primary and specialty care is eroding.6 This lack of access has adverse consequences for the nation’s children with Medicaid. In addition to a higher rate of perforated appendicitis, children with Medicaid compared with children with private in-surance have been shown to have a 3.5 times greater likelihood of being hospitalized with a vaccine-pre-ventable disease7_{and higher rates of severe diabetic} ketoacidosis at initial presentation.8_{Studies also} sug-gest that failure to provide Medicaid-insured chil-dren with primary care results in increased emer-gency department use9_{and higher physician-related} Medicaid expenditures.10_{Also, when preventive care} processes are well designed, immunization status is not associated with any family or child sociodemo-graphic characteristics.11 _{Taken together, these data} support the contention that differences in outcomes reflect the effectiveness of the care processes of the delivery systems rather than just the characteristics of the Medicaid population.

These studies provide additional evidence that low physician payments restrict access to needed care by Medicaid-insured patients, resulting in in-creased expenditures instead of cost saving. When Medicaid payments fail to cover physician and hos-pital costs, everyone loses; children and their families insured by Medicaid and the State Children’s Health Insurance Program (who experience excessive mor-tality and morbidity), community-based

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cians and hospitals (who must find a way to cover their costs or reduce services), the business commu-nity (who will have to pay more to providers to subsidize at least part of the shortfall), and the tax-payers (who are not getting the best value for their dollars). The findings of this excellent study by Smink et al2 _{should remind state policy makers to} give a higher priority to improving access to primary and specialty care for children with Medicaid. The findings also demonstrate a failure at both the state and federal levels to enforce the federal legal require-ment called the “equal-access” statute, which states that children with Medicaid should have access to pediatric services to the same extent as children in-sured in the private sector living in the same geo-graphic area. Transforming our private and public pediatric health care systems to emphasize value is a formidable challenge, and the articles by McInerny et al and Smink et al demonstrate how essential it is to make progress in this task.

Stephen Berman, MD, FAAP Department of Pediatrics

University of Colorado School of Medicine Denver, CO 80218

REFERENCES

1. McInerny TK, Cull WL, Yudkowsky BK. Physician reimburse-ment levels and adherence to American Academy of Pediatrics well-visit and immunization recommendations. Pediatrics. 2005;115: 833– 838

2. Smink DS, Fishman SJ, Kleinman K, Finkelstein JA. Effects of race, insurance status, and hospital volume on perforated appendicitis in children.Pediatrics.2005;115:920 –925

3. Glazner JE, Beaty BL, Pearson KA, Berman S. The cost of giving child-hood vaccinations: differences among provider types.Pediatrics.2004; 113:1582–1587

4. Bratton SL, Haberkern CM, Waldhausen JHT. Acute appendicitis risks of complications: age and Medicaid insurance.Pediatrics.2000; 106:75–78

5. O’Toole SJ, Karamanoukian HL, Allen JE, et al. Insurance-related dif-ferences in the presentation of pediatric appendicitis.J Pediatr Surg. 1996;31:1032–1034

6. Berman S, Brock C, Armon C, Todd J. Factors Influencing Access to Healthcare for All Colorado’s Children, 2000–2003. Denver, CO: State of the Health of Colorado’s Children; 2004. Available at: www.thechildrenshospital.org/share/clinicalservices/handout/ 556.pdf. Accessed February 1, 2005

7. Anderson M, Todd J.Vaccine-Preventable Diseases in Colorado’s Children, 2002. Denver, CO: State of the Health of Colorado’s Children; 2003. Available at: www.thechildrenshospital.org/publications/cc/2004/ 04feb.pdf. Accessed February 1, 2005

8. Maniatis AK, Goehrig SH, Rewers A, Walravens P, Klingensmith GJ. In-creasing incidence and severity of diabetic ketoacidosis among unin-sured children with newly diagnosed type 1 diabetes. Presented at: the American Diabetes Association National Meeting; June 2004; Orlando, FL

9. Johnson WG, Rimsza ME. The effects of access to pediatric care and insurance coverage on emergency department utilization.Pediatrics. 2004;113:483– 487

10. Cohen JW, Cunningham PJ. Medicaid physician fee levels and chil-dren’s access to care.Health Aff (Millwood).1995;14:255–262

11. Vivier PM, Alario AJ, Peter G, Leddy T, Simon P, Mor V. An ana-lysis of the immunization status of preschool children enrolled in a statewide Medicaid managed care program. J Pediatr. 2001;139: 624 – 629

Heart Rate Characteristics in

Neonatal Sepsis: A Promising Test

That Is Still Premature

ABBREVIATIONS. HRC, heart rate characteristics; WBC, white blood cell; SIRS, systemic inflammatory response syndrome; ROC, receiver operating characteristic.

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here have been many reports of different heart rate–variability metrics and their association with sepsis in neonates, children, and adults.1–8_{Common to all has been a lack of} specific-ity between subjects, although sensitivspecific-ity to dynamic changes within subjects has been very high.

In this issue ofPediatrics, Griffin et al9_{report on a} specific group of measures (or metrics) of heart rate variability, termed the heart rate characteristics (HRC) index, and its association with blood-culture– proven sepsis in neonates.

The basis for their research is the poor diagnostic sensitivity and specificity of the current clinical and laboratory evaluation of an infant for suspected sepsis. Current neonatal practice includes careful examination for sepsis-associated physical findings including tem-perature instability, tachycardia, tachypnea, apnea, prolonged capillary refill time, hypotension, and/or decreased urine output. Corroborative laboratory tests include significant elevation or depression of the white blood cell (WBC) count, the presence of immature neutrophils, metabolic acidosis (lowered pH and/or bicarbonate or elevated lactate), throm-bocytopenia, coagulopathy, or evidence of renal or hepatic dysfunction. Of course, the “gold standard” is a positive culture of blood, cerebrospinal fluid, or urine, but there is an unacceptably long turn-around time for results (often ⱖ24 – 48 hours) and a high false-negative rate. This was confirmed recently by the National Institute of Child Health and Human Development Neonatal Research Network, which found that many of the currently used physical signs and laboratory tests were nonspecific and did not predict the presence of sepsis accurately.10_{Griffin et} al9 _{point out that the poor diagnostic accuracy is} likely attributable to the complexity and variability of the host response to infection, commonly referred to as the systemic inflammatory response syndrome (SIRS).11,12

The authors’ hypothesis was that the HRC index adds information to conventional laboratory tests in diagnosing neonatal sepsis. To test this hypothesis, they prospectively collected heart rate data in 678 consecutive infants who stayed⬎7 days in a single NICU over a 4-year period. They measured HRC and

Accepted for publication Jan 25, 2005. doi:10.1542/peds.2005-0182 No conflict of interest declared.

Address correspondence to Brahm Goldstein, MD, FCCM, Department of Pediatrics, Pediatric Clinical Research Office, Doernbecher Children’s Hos-pital, 707 SW Gaines St, Mail Code: CDRCP, Portland, OR 97239. E-mail: goldsteb@ohsu.edu

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DOI: 10.1542/peds.2005-0189

2005;115;1068

Pediatrics

Stephen Berman

Systems to Emphasize Value

Challenge of Transforming Our Private and Public Pediatric Health Care

Services

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DOI: 10.1542/peds.2005-0189

2005;115;1068

Pediatrics

Stephen Berman

Systems to Emphasize Value

Challenge of Transforming Our Private and Public Pediatric Health Care

http://pediatrics.aappublications.org/content/115/4/1068

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