Thanking Public Health Professionals for Longer Lives

I celebrate my birthday today.  As I enter my 59^th year on earth, I wonder who, besides my creator, I should thank.  Public health professionals are a good place to start.

If I had been born just 50 years sooner, my life expectancy would have been 47 years. 

But life expectancy grew by almost 30 years in the 20^th century.

In the last ten years, the age-adjusted death rate in the United States has decreased by another 16%.  I can expect to live as many as 20 years longer than my parents did. 

source: CDC, 2011

So what’s making the difference?

The Centers for Disease Control and Prevention (CDC) has some answers.

CDC recently released its top ten public health achievements of the last ten years, and there are some surprising accomplishments on the list. Not a single one got a headline.  In fact, the release of entire list was overshadowed by the media attention given to the humorous hook a CDC blogger used the same week to educate people about preparing for natural disasters.

The top ten achievements have come in such diverse areas as cancer prevention, maternal and child health, infectious disease control, injury prevention, and cardiovascular disease prevention.   

Together, they have lowered the death rate during a time when we are being warned that because of our short-sightedness our children may live shorter lives than we will.

Here are some of the things that have happened in the last ten years, and why:

• A 30% reduction in U.S. tuberculosis cases was the result of increased government spending on infrastructure improvements to local public health;
• A decline in smoking prevalence to just over 20% of the population was the result of the impositions of tobacco taxes and restrictions on smoking in public places;
• The government-mandated addition of folic acid to cereal grains led to a 36% reduction in infant neural tube defects, and a savings of $4.7 billion in direct medical costs;
• Safer cars, safer roads, and government-mandated seat belt use reduced the death rate from motor vehicle accidents by 26%, and the injury rate by 36%;
• The age-adjusted death rates from heart disease and stroke declined by over 35% and 31%, respectively, because of declines in the prevalence of risk factors, government regulations on quality of care and FDA approvals on new, safe medications;
• Death rates from colorectal cancer in both men and women declined by over 20% because of insurance mandates covering early detection and screening programs.

The common denominators in these remarkable improvements in our health status are the “gang of five” 21^st century government villains – higher taxes, increased regulations, more mandates, new spending, and restrictions on the irresponsible exercise of “freedom.”

With villains like these, who needs friends?

For the past hundred years and more, public health has been one of our government’s crowning achievements.  It has accounted for much of the increase in life expectancy from 1900 to 2000.  It may be the reason I’m writing – and you’re reading – these words today.

In the 20^th century, the private sector did not find a cure for most cancers or cardiovascular disease.  It did not eliminate viruses and bacteria from our lives.  It did not eradicate environmental pollution, or prevent devastating climate change.  It could not even cure the common cold, though such a cure would have been worth billions to the fortunate company that did.

It did, however, develop effective drugs to manage chronic conditions, surgical techniques and treatment protocols to improve care quality, strategies for mitigating the effects of environmental contamination, and tools for unlocking the mysteries of the genetic code.  It did these things in partnership with public health, using assistance from the government. 

So why do so many state and federal policy leaders want to pull the rug out from under public health when we need it the most? A report of the National Association of County and City Health Officials (NACCHO) documents the loss of 29,000 local public health people between 2008 and 2010, and a recent news release by the Association of State and Territorial Health Officials (ASTHO) notes that federal and state funding cuts jeopardize many of the most successful public health initiatives.

Attacking public health isn’t getting governments off the backs of the people, because reality is the other way around.  Public health practitioners do the heavy lifting, carrying people on the backs of governments.

We need to celebrate our public health accomplishments – especially those of us who have lived beyond the 47 years of life we could have expected had we been born in 1900. 

We need to remember that each extra year is a gift to us, not just from our creator, but from the people who work for our governments. 

To receive an email notice when new Our Health Policy Matters columns are published, please send an email to gionfriddopaul@gmail.com.

Seven Problems With Florida's Medicaid Managed Care Reform

In my last column, I described Florida’s new Medicaid managed care and previewed a few of its implications.

In this column, I look closely at seven problems in the law.  

First, Medicaid recipients will be asked to pay $10 per month to participate in the program, and $100 for each non-emergency use of a hospital emergency room. 

This will increase Medicaid costs, not lower them.  Charging even $10 a month for Medicaid encourages people to avoid enrolling in the program until they get sick. What they don’t get is preventive care, so their care costs more. 

Half of all emergency room visits are “non-emergency,” but the patient doesn’t know this until after he or she gets the diagnosis.  For example, chest pain is sometimes indigestion, but other times, a heart attack. You don’t want someone who might be having a health crisis to delay receiving care because they don’t have $100.  If they do and guess wrong, their care will only cost the state more.

Second, Medicaid recipients will be required to share their complete medical records with the government. 

There is no reason for this, and this kind of privacy invasion isn’t popular with anyone.  We may not care when it happens to someone we don’t know, but watch how we react when it happens to mom in the nursing home. 

Third, Florida has created a Medicaid profit-sharing plan which encourages managed care companies to drive up costs in the first year and take them back in profits the second year. 

The law allows plans losing money in the first year to recoup those losses in the second year.

This creates a perverse incentive for organizations.  Because they don’t have to worry about first-year losses, they have an incentive to enroll the highest cost patients possible in order to maximize their payment rates.  If they then crack down on utilization in the second year, they can maximize their profit potential at little or no risk. 

Fourth, Florida’s plan creates a really perverse economic incentive for the state. 

The higher the profit made by a managed care company, the more the state gets back as a rebate. 

If the state has a future budget crisis, it could be tempted to manage that crisis by pressuring its managed care partners to deny or delay care to recipients – especially in the latter part of a fiscal year – to increase the amount of the rebate the state will receive.

Fifth, each plan must offer smoking cessation, substance abuse treatment, and “medically directed weight loss” programs. 

Personally, I support this.  However, when “the government starts telling us what we can and cannot eat,” a lot of small-government advocates (including some Florida legislators) claim they draw the line.

Sixth, Medicaid recipients who are found judicially or administratively to have engaged in Medicaid fraud will forfeit their Medicaid eligibility for ten years. 

This sounds fine, but what happens when an addict is found “administratively” to have engaged in fraud by pill shopping among providers?  Or when a person with mental illness is found “administratively” to have engaged in fraud by claiming phantom physical complaints?  Do we really intend to discriminate against certain people for their medical conditions?

Also, what happens when someone found to have engaged in fraud develops a high-cost condition, such as cancer, several years later?  Does this “one-strike-and-you’re-out” policy mean the state expects providers to cover the future cost of care without any reimbursement?

Seventh, Florida’s Medicaid reform re-introduces hospital rate setting. 

A generation ago, in a far more “big government-friendly” era, Medicare adopted a prospective payment system to set hospital rates.  It used “diagnosis-related groups,” or DRGs to do this, and several states used DRGs to establish hospital rate-setting systems.  While Medicare has retained and adjusted its DRG system, most other DRG-based rate setting vanished years ago.

DRGs, however, will re-appear in Florida in 2013. The legislature has directed AHCA to develop a DRG system for Medicaid.    

Here are two reasons why this won’t work as intended.  The first is that Medicaid patients are a far more diverse group that the Medicare population.  Forcing hospitals to work within pre-set DRG rates can be extraordinarily unfair to the hospitals serving the neediest and most complex of patients.

The second is that the only way hospitals can guard against DRG harm is to engage in the legal practice of “DRG creep.”  Hospitals have a financial incentive to assign the highest-paying diagnosis code possible to every patient they see.  The result?  Rates may come down, but costs will go up.

Florida’s Medicaid reform has been called transformational.  Life is full of transformations. Some last, but others fade quickly.  The new Florida law may seem like big change, but its promised benefits may soon be regarded as something of a mirage.

The Florida Medicaid Reform Law is the result of the passage of two separate bills, HB 7107 and HB 7109. Information referenced in this column can be found in the text of one of the two bills.  If you have a question about the specific location of any text, please contact the author at gionfriddopaul@gmail.com.

Florida's Disappointing Medicaid Reform

Florida’s Medicaid reform law, which takes effect on July 1, mandates the enrollment of most of Florida’s 3 million Medicaid recipients into managed care programs.  It has been called transformational, but it probably won’t deliver on its promise.

There is a lot to write about, so I’m devoting two columns to the subject – and publishing them both this week, instead of one this week and one next week. 

This column focuses on the details of the new program.  It explains how first year cost savings are unrelated to managed care, why families of nursing home residents in particular should be worried, and how a new profit motive has been built into the Medicaid program. 

My next column will focus on seven policy problems built into the new law.   

While managed care got the headline, the first-year savings in the legislation come from a 5% provider rate cut, not from managed care. 

Medicaid will still be a $20 billion+ program.  It will still consume nearly a third of the state budget, and it will still expand significantly in 2014.

By incorporating the 5% cut into the law, Florida legislators anticipated a possible rejection of the managed care program by the Department of Health and Human Services. 

HHS has problems with Florida’s approach.  Florida Senators threatened to drop out of the Medicaid program if HHS did not approve the changes, putting $11 billion at risk.  Cooler fiscal heads prevailed, and this threat was dropped from the final version.

Assuming HHS eventually agrees, the Florida Medicaid program will be divided into three parts.

One will serve mostly elderly people with long term care needs.  Another will serve families, children, and adults with chronic health and mental health conditions.  The third will serve people with developmental disabilities.

Nearly everyone in the first two groups will be required to enroll in managed care plans.  Those in the third group will not.  They will keep their current Medicaid program, but payments will be capped and a plan for restructuring it will be submitted to the Legislature by 2014.

For the other two groups, the state will be divided into 11 regions.  Between two and six managed care plans will serve each region.  There will be separate plans for the long term care group and the families and children group.   One of the plans approved for the long term care group in each region must be offered by a Long Term Care Service Provider Network, led by a long term care provider.  One of the plans approved for the families and children group in each region must be offered by a Provider Service Network, led by a hospital, public agency, or other safety net provider.

The long term care program will be fully operational by October, 2013, and will include incentives to transition as much care from nursing homes to the community as possible. 

The CARES (Comprehensive Assessment and Review for Long Term Care Services) evaluation system will be used to determine each Medicaid recipient’s level of need.  Level 1 recipients must be in a nursing home.  Level 2 recipients still living in the community must have extensive physical or mental impairment.  Level 3 recipients will have mild physical or cognitive impairments.

Payments to plans will be based on three levels of need of the patients in each plan.   

For the first year only, all nursing home patients will be protected from discharge, whether or not their level of need changes.  However, plans will receive incentive payments from AHCA for every 2% shift in their population toward community care in either the first or second year, and for 3% shifts in subsequent years.  Incentive payments will continue until no more than 35% of plan recipients are in institutional settings.

So what could happen to an elderly nursing home resident? 

After the first year, any time her level of need is determined to be less than Level 1, she could be discharged to home care whether or not she or her family agreed.

Also, a managed care company with a motive, not a family and a clinician, will decide when an Alzheimer's patient needs institutionalization.

This new Medicaid program puts a premium on profits. 

In the families and children program, most recipients will have 30 days to choose a plan.  If they don’t, they will be assigned to one.

The state will negotiate rates with plans based on a “per member per month” fee, adjusted for the region and clinical profile of the patients in the plan.  For the first two years, provider service networks will have the option of receiving traditional fee-for-service payments.

Plans will be able to take up to 8.5% in profits, and the state will be their silent business partner. 

Here’s how this works.  Plans can retain the first 5% of total income received as a profit.  They can make another 1% if they exceed state quality measures.  They capture 2.5% of the next 5% of profit.  The rest goes to the state.  After that, all profits go to the state.

Plans are protected from losses in the first year.  The law allows them to subtract those losses from income during the second year.  A plan losing 5% in the first year will be allowed up to 13.5% in profits in the second year.

Is creating a profit motive for safety net health care really such a good idea?

The Florida Medicaid Reform Law is the result of the passage of two separate bills, HB 7107 and HB 7109. Information referenced in this column can be found in the text of one of the two bills.  If you have a question about the specific location of any text, please contact the author at gionfriddopaul@gmail.com.

Sharing the Pain in Florida?

There were more than a few sighs of relief when Florida House and Senate members came to an agreement on health and human budgets this week.

There was also some welcome news. 

But not everyone is happy, and there will still be plenty of pain to go around.  People like me won’t feel it, but millions of others will.

First, let’s get to the good news. 

After weeks of uncertainty, funding for adult mental health services will not be eliminated or cut.  Senate and House leaders, led by Rep. Denise Grimsley, came to the conclusion that asking people with mental illness to shoulder this much more pain this year was just too much.  This is a tremendous relief to everyone affected by mental illness.  Though we may not be able to quantify “things that don’t happen,” we know that legislators saved many people from harm, and prevented scores of crises down the road.

The Medicaid “medically needy” and “aged and disabled” programs in Florida also remain intact.  If they had been eliminated, over 81,000 elders and people with disabilities would have been left with no more health care and no money.  These are all people either living in poverty already or who have monthly incomes too high to qualify for Medicaid – even though they have no savings and have to spend most of their income on medical care.    

Legislators deserve credit for making these choices in the face of surprisingly strong headwinds.

Now let’s get to some of the bad news.

Hospitals will take a 12% cut in state Medicaid payments, and nursing homes will take a 6.5% hit (on top of a 10.5% cut this year).  Home care providers will also be cut.

It’s always a little easier to cut from providers than it is to cut from people, but these cuts to providers affect real people, too.

For example, many hospitals already lose a lot of money providing care to the Medicaid population because reimbursement rates are low.  There are only two ways they can absorb another 12% reduction in payments.  Either hospitals will be forced to cut back on services to everyone, or private health insurance rates will have to increase to offset the reduction.

Nursing homes are often the last home many people with chronic illnesses will experience in life.  60% of nursing home residents rely on Medicaid to pay some or all of their bills, making Medicaid the largest payer of nursing home care.  Cutting Medicaid rates another 6.5% means further constraining care for some of our oldest, sickest citizens.

People relying on home and community based services as an alternative to nursing home care also weren’t spared.  The compromise appears to reduce funding for home-based services by over $36 million, by reducing provider rates by 4%.

Medicaid managed care will also move forward.  This is an unsettling prospect for many.  It will mean months of testy negotiation with a federal government that will be reluctant to approve Florida’s waiver.  If Florida reaches a compromise with HHS, it will then mean years of transition to a managed care program that could still result in less care for almost 3 million Floridians.

In commenting on proposed cuts before the final votes were cast, a State Senator noted that “everyone is going to have to share in the pain.”

But is that what really happens in this budget?

It doesn’t look like I’ll be feeling any pain when this Florida state budget gets put to bed.  My health insurance will be there when I need it, my physician will still make enough money to cover his cost when he treats me, and I probably won’t need hospital or nursing care this year.

Looking at the bigger budget picture, my youngest son graduated from our local public high school a couple of years ago, so I won’t feel the effects of school funding cuts.  My daughter is in an out-of-state university, so I won’t notice the tuition increases here in Florida.  My mother died a decade ago in Connecticut, so she won’t be affected by cuts to a Medicaid program that allowed her to live her final years in the comfort of her own home.

For me and people like me, there are $308 million in tax relief in this budget - far less than the $2 billion the Governor wanted.  Some of it may even lower my property taxes again.  They have already been cut by 41% this year – largely because of the odd methods we have of determining the taxable value of property in this state.

It’s nice to know that I won’t have to live with any pain this year.  While I’m grateful that some people with mental illness and impoverished elders won’t either, I can’t help thinking at least a little about those who will – and wonder why.

If you have any questions about the column, or to receive a weekly email notifying you when new Our Health Policy Matters columns are published, please contact gionfriddopaul@gmail.com.