I was asked to give the keynote address today at a senior leadership retreat for Sutter Health’s Sacramento Sierra Region. Sutter is a community based, not for profit health system.

The Gordon and Betty Moore Foundation has teamed up with Sutter to explore means and methods to transform this multi-centered health care system to the next level of quality, safety, and patient-centeredness. Sutter has already done a lot of good work in these arenas, so the hope is to build on that an explore how to do still better and enhance the likely sustainability of the results.

Pictured here are Michael Dourgarian, a local businessperson who is Chair of the Board of this region of Sutter, and Karyn DiGiorgio, RN, MSN, Program Officer for the Moore Foundation. Not shown is Dr. John Mesic, Chief Medical Officer, who introduced me and has had a lot to do with the broader Sutter effort, and Sarah Marie Miller, who helped organize the retreat.

My job was to tell the story of BIDMC’s approach to quality and safety, transparency, process improvement, and patient and family involvement. As always, this prompted lots of good questions and interaction, as people considered what might be drawn from our experience and applied to their own, and as I did so in reverse from their comments.

I just got word that Ray Tye, one of the most generous people I have ever met, has died. He was generous in the way Maimonides would have liked: He gave without fanfare and with no wish for recognition.

Every now and then, he would hear of a patient, either local or international, who needed some sort of expensive medical treatment that was unaffordable for that person. Ray and his Medical Aid Foundation would provide funds for travel, treatment, and follow-up care — from conjoined twins to an Iraqi woman with a heart condition.

In spite of his not wanting attention, people wanted to recognize Ray. Here, for example, Catholic Charities gave him their Justice and Compassion Award, the first time Catholic Charities presented that award to a member of the Jewish community.

At the personal level, Ray was warm and thoughtful and engaging. He would call me from time to time with an idea or to offer support, and he was always polite and modest, never wanting to interfere or be an inconvenience.

He was beloved in our community and will be missed in so many ways.

I admire the President and really hope a health care bill is passed by Congress, but I wonder if his overstatement of what the bill does might ultimately cause him to fail. Here’s the latest, as reported in today’s New York Times:

Boiling down his proposal to a few sentences, Mr. Obama asked, “How many people would like a proposal that holds insurance companies more accountable? How many people would like to give Americans the same insurance choices that members of Congress get? And how many would like a proposal that brings down costs for everyone? That’s our proposal.”

Is that really the proposal?

As for holding insurance companies more accountable, a number of state insurance commissioners have their doubts, at least with regard to federal regulation of premium rate levels.

Will we have the same insurance choices as members of Congress? Well, maybe to the extent that they can choose from a number of plans, but that is not the full set of benefits to which they are entitled.

And, as for bringing down costs, every person in the industry knows that is just not true. David Brooks explains why in his op-ed today.

From the beginning, I pointed out that Mr. Obama was over-promising when he was offering (1) a reduction in health care costs; (2) an increase in access for people currently uninsured or under-insured; and (3) maintaining choice for people in their selection of doctors and hospitals.

Opposition to Mr. Obama’s plan is often characterized as a politically motivated attack from the Republicans. Certainly, some of that is true. But some portion of the opposition also arises from this kind of overstatement, which in turn generates mistrust or at least concern among educated members of the public.

Mr. Obama is betting, though, that his energy and passion will carry the day in motivating members of Congress in his own party to muster enough votes.

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The Rx-360 Consortium announced the start of a pilot plan to allow pharmaceutical manufacturers to share audits of suppliers. The first part of the pilot is intended to gauge the value of sharing the existing body of supplier audit information that already exists within consortium member companies.  The consortium has an Audit Standards Working Group with 27 participants, representing 19 companies and organizations. The group is looking at standards for APIs, excipients, supply-chain security, basic chemicals, packaging, and print.

From the Rx-360 An International Pharmaceutical Supply Chain Consortium:

“Rx-360 is a consortium being developed by volunteers from the Pharmaceutical and Biotech industry which includes their suppliers. The purpose is to enhance the security of the pharmaceutical supply chain and to assure the quality and authenticity of the products moving through the supply chain. The individuals developing this concept are working in the best interest of patients. We are a non-profit organization with the mission to create and monitor a global quality system that meets the expectations of industry and regulators that assures patient safety by guaranteeing product quality and authenticity throughout the supply chain.”

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What happens next in Massachusetts with insurance reimbursement rates now that many of the facts and figures have been made public?

Here’s what I see. The dominant parties in the state on whose watch the disparities in the marketplace have taken place — Blue Cross Blue Shield and Partners Healthcare System — face financial and political problems, respectively. The PHS rates that are so much higher than others’ cause a major financial drain for BCBS. They do so in the short run just by the degree of current utilization. The effect is compounded over the long run, though, as PHS has a competitive advantage vis-à-vis other systems in recruiting community-based doctors and thereby brings more and more referrals into its hospitals. That these differentials have now been made public by the state creates a political embarrassment for PHS, which has often asserted that its creation brought about substantial economies of scale through integration of care.

I suspect that these factors will lead to a negotiated agreement between BCBS and PHS, where PHS takes a bit of a haircut in its current reimbursement contracts. Not so much that it dramatically affects the PHS bottom line, but enough so that both parties can say that they have cooperatively acted to slow down the rate of health care spending in the state. Will the new rates be anywhere near the statewide average? No way. Will they do anything to offset the competitive advantage that PHS has had or will continue to have? No.

Then, BCBS will come to the rest of us (including BIDMC and our physician group) whose rates are next in line and ask for a “comparable” rate reduction. Citing the PHS deal, we will be publicly and privately pressured to make similar concessions for the good of the Commonwealth. Of course, any such rate reduction would then serve to maintain PHS’ market dominance.

Here’s my proposal instead. Let us, in the presence of the state’s Attorney General, so there are no concerns about antitrust violations, all agree to rate schedules equal to the current statewide average reimbursement rates for hospitals and doctors.* Let’s create two major categories — one for academic medical centers and their doctors to reflect the societally important teaching role — and one for community hospitals and community-based physicians.**

In other words, let us recognize that the health care reimbursement system in Massachusetts is broken. It is time to get rid of the idea that rates should reflect market power. Have them instead reflect the health status of the population, with appropriate adders for medical education or other specific programs of societal value as directed by the state. Further, if the state and federal government insist on underpaying for Medicaid and Medicare patients, let us acknowledge that amount explicitly in the approved rates for the private insurers.

I know I don’t fully understand the insurance business, but I cannot figure out why BCBS and the other insurers in the state would object to this approach. I can’t see why it is to their advantage to conduct numerous negotiations for reimbursement rates or to have different rates in place for exactly the same services.

What about quality, you might ask? Well, it would certainly be great to adjust reimbursement rates for meaningful measurements of quality of care. But let’s start first by equalizing the base rates, and then we can work on quality metrics in the next step.

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*Or if would make more sense, perhaps a different average would be employed for the Eastern and Western parts of the state, or urban versus rural areas, to reflect regional differences in the cost of living.
** While I make this point with regard to fee-for-service payments, it is certainly a prerequisite for a move towards the kind of global, or capitated payment recommended by the state’s Massachusetts Special Commission on the Health Care Payment System. As I have noted in an earlier post: If a capitated rate were established for PHS providers today based on this differential, it would perpetually reward this health care system for its market dominance.

US Senator John Kerry joined a BIDMC event last night in Florida to provide an update to members of our community on recent events in Washington regarding the progress of a national health care bill. We were impressed with the extent of the Senator’s knowledge on the subject and his commitment to thoughtful legislation, and we were grateful for the time he spent with us.

There was also time for John to meet several of our supporters and doctors. Here, he is briefed by Maine businessman Bobby Monks and BIDMC doctor Dr. Steven Freedman,who have been working together to develop a new patient empowerment and involvement model called “Trust”.

Humorous note: Dr. Mark Zeidel, our chief of medicine, jokingly describes Trust as a template for patient-doctor interactions that would enable a husband to offer his wife a full, complete, and detailed summary of his visit with a doctor — as opposed to the stereotypical summation:

She, “What happened and what did he say?”
He, “It was fine.”

Several months ago, I wrote about the futility of banning social media in a hospital. I argued that it was counterproductive and a waste of resources. This point of view has been supported in other forums.

Now, I learn that the University of Iowa Hospitals and Clinics organization is banning Facebook and other such applications as “inappropriate for the health care workplace.”

I shared this article with e-Patient Dave, who replied, “The instant killer question on this issue, from the people I talk to, is ‘So, what do they do about people doing it on their phones?’”

Indeed.

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I was originally disappointed when I first scanned this Medical News Today article, Resveratrol May Replace Aspirin As Heart Protector; Longevinex® First Branded Resveratrol Pill Successfully Tested During Heart Attack.

As a red wine lover, my disappointment turned to joy when I read this:

The amount of resveratrol in 3 to 5 glasses of red wine is only about 3-5 milligrams, but the heart protective effect is believed to be produced by the total polyphenolic molecules in a glass of dark, aged red wine, ~60 milligrams per 5-ounce glass. The optimal health benefit derived from red wine is achieved at a consumption level of 3-5 glasses, which would be considerably more expensive than a resveratrol pill, and certainly pose the problem of inebriation.

In a nutshell, I get to drink red wine to, pardon the pun, to my heart’s content!

For Wine Lovers:
Wine Lovers Dishwasher Magnet

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I really enjoy sharing what we have learned about enhancing quality and safety, transparency, and process improvement with health care providers and insurers around the country. But sometimes you just can’t arrange to be there in person.

Today, I was invited to talk with board members and senior staff at HealthSpring, a large Medicare Advantage organization serving several states in the South and Midwest. I couldn’t get there, so I joined by phone. Here’s a picture of “me” presenting to the group.

The Pioneer Institute is a public policy research center in Massachusetts. On the political spectrum, most people would call it conservative, or a least free-market oriented. In my opinion, regardless of your particular position along that spectrum, the institute’s work is worth reading.

Last month, it issued a paper about the Massachusetts health care reform experiment that serves as a report card on a number of factors, with particular focus on the question of the equity and sustainability of the financing of the health care insurance access system put in place by Chapter 58 of the Acts of 2006.

For those interested in the possible applicability of the Massachusetts model to the national scene, authors Amy M. Lischko and Kristin Manzolillo say:

It is undeniably premature to enact a reasoned national-level solution based on Massachusetts’ or other state experiments. . . .

[We give Massachusetts'] health care reform financing an overall grade of “C” based on the following findings:

Metric 1: Is the funding for healthcare distributed equitably across various funding sources? The data indicate good performance in this area in the early phases of reform; however, without more recent data available, there is only a moderate level of certainty that this has been sustained. Grade: B.

Metric 2: How have per capita health care expenditures changed for the newly insured and the health safety net? Reform’s sustainability relies upon a continuing decrease in the use of the Health Safety Net Trust Fund (HSNTF) as more individuals gain access to insurance. With funding going towards both the HSNTF and Commonwealth Care, along with increased per capita spending on the newly insured, it remains unclear if this model is sustainable. Grade: C

Metric 3: Has the reform altered relative health care cost trends?There is no evidence to suggest that the reform has changed the general health care cost growth trend that was estimated based on 2004 data; however, it is inappropriate to rely on older data for evaluation of this metric. Grade: Incomplete.

Metric 4: Are premiums going up and if so for whom? The reform has to date succeeded at reducing the rate of increase for people purchasing in the nongroup market, but costs in Massachusetts still exceed national averages. Furthermore, the recent cost increases experienced by small groups need to be understood and quickly addressed if the reform is to be sustainable. Grade: C

Metric 5: Are residents able to afford coverage, or do they seek exemptions to the individual mandate? Based on the available data, the initial number of individuals deemed unable to afford coverage is minimal. However, with rising health care costs, the sustainability of this area of reform is questionable. Grade: B

Metric 6: How do Massachusetts’ medical bankruptcy rates compare to those in other states? While Massachusetts residents reported a decrease in the difficulty of paying medical bills since 2006, one in five adults indicated that they were paying off medical bills over time in 2008. When looking at adults earning more than 300% of the federal poverty level, over one in four are still carrying medical debt. Grade: C