5What do healthcare consumers know about cost? The Washington Post November 10, 2011Should government regulate health care prices?“Massachusetts is now in…a debate about how to bring down its skyrocketing health care costs. And the state’s new proposal to regulate how much providers charge for health care…the state found that some Massachusetts doctors charge six or seven times as much as their colleagues for the exact same procedures …
8What do consumers really know about quality? Almost 2.5 million patients undergo surgery unnecessarily every year. Many of them end up in worse shape than before their procedures.“back surgery is needed in only a small percentageof cases. Most back problems can be taken care ofwith nonsurgical treatments, such as medication, ice, heat, gentle massage and physical therapy.”- Mayo Clinic
9What should consumers know? "The practice of medicine doesn't always follow the best evidence… I think if patients were well informed, they would choose the right thing… the least invasive, less risky procedure.“ James Weinstein Director, Dartmouth Institute Health Policy and Clinical Practice.
10What about about cosmetic surgery, Lasik, and implants?
11healthcare consumerism, value-based benefit design, Why transparency?Premise:Widely available and robust Cost and Outcome Information i.e., healthcare transparency, will enable:healthcare consumerism,value-based benefit design,outcome-based payment reform,and therefore, high-value healthcare.
12There is some good news in Virginia to build upon Virginia fares well among most states and earned a B in a national study on health care pricing transparency because of its state’s laws like the All Payer Claims Database (APCD) and the information available like Virginia Health Information (VHI).
13All Payer Claims Database (APCD) The Virginia APCD will aggregate all claims databases from all payers and can provide:a comprehensive picture on total treatment costs across an episode of care, together with some quality information (e.g., number of diabetics with A1c test compliance),data to evaluate what goes into a complete episode of care for a high-cost service, how that cost varies and how to structure provider payments to reward better value.Note: Self-insured employers must approve release of claims data to the APCD by ASOs.
15Virginia Health Information Plan and Transparency
16Transparency enables cost-effective benefit design Value Based Insurance Design (VBID)Don’t cover ineffective care, e.g., Routine EKGsPay for effective care, e.g., $0 Copays Tobacco CessationChoosing Wisely45 Don’t do(s) according to the Medical SocietiesReferenced-based pricing (RBP)Set cost limits on coverage based on reasonable cost, i.e. no $3000 MRIs, if $600 MRI is obtainable
17Transparency enables more effective benefit design Centers of Excellence (COE)Require treatment by high quality providers, e.g.,Lowes: Cardiac Care only at Cleveland ClinicStep TherapyExhaust less invasive/costly first, e.g., ibruprofen before Enbrel, anti-inflammatory medication before surgery
18Transparency and the market place Outcome and cost transparency will enable outcome and performance-based provider rewards:P4P Payment structuresConsumer foot trafficRe-pricing of care services, e.g., primary careReallocation of healthcare services investmentRedirection of medical schools
19Transparency is required in a perfect world “First, patients will be at the heart of everything we do. So they will have more choice and control, helped by easy access to the information they need about the best GPs and hospitals. Patients will be in charge of making decisions about their care. Second, there will be a relentless focus on clinical outcomes. Success will be measured, not through bureaucratic process targets, but against results that really matter to patients – such as improving cancer and stroke survival rates.”Andrew LansleySecretary of State for HealthUnited KingdomJuly 2010
20Improving Healthcare Transparency in Virginia Optimize the analysis, distribution and use of all APCD dataDevelop and proliferate consumer friendly, evidence-based care alternatives to include outcomes for all prevalent servicesSupport the transparency initiatives in the VHIPHealth plan sponsors see Transparency as foundationalBlueprint Virginia - Healthcare