UNIVERSITY OF WISCONSINHEALTH POLICY SYMPOSIUM
T. A. Brennan
Harvard Medical School
Harvard School of Public Health
Physician Accountability in Health Care Reform
November 17, 2005
2
Outline
A. Diagnosis of next 15 years of health policy developments
B. Discussion of medical professionalism and medical ethics
C. Accountable Physician: Three examples
3
Health Policy 2005-2020
1. Cost is the overriding issue
2. Quality will continue to be discussed and discussed…
3. Access will suffer
4
0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000 10000 15000 20000 25000 30000 35000
Hungary
Spain
Sweden
France
Japan
Germany
Norway
Switzerland
USA
GDP per Capita, $
Hea
lth
Exp
endi
ture
s pe
r C
apit
a, $
GPD and Health Care Spending
5
14
15
16
17
18
19
20
21
22
23
24
1979 1982 1986 1989 1992 1995 1998 2001
Uninsured Workers and Health Care Spending
Percent uninsured among workers
Per capita health spending divided by median income
Sources: Authors’ analysis of Current Population Survey (CPS), March supplements, Annual Demographics Files, 1980-2003, except 1981; and Centers for Medicare and Medicaid Services, National Health Accounts, 1979-2002.
Notes: Percentage uninsured (solid line) is scaled on the left axis, and per capita health spending divided by median income (dashed line) is scaled on the right axis. Results for 1979-1999 have been adjusted to make them consistent with the insurance verification question that was added to the CPS in 2001. The series for workers is restricted to those not covered as a dependent or by a public program
0.110
0.102
0.094
0.086
0.078
0.070
0.062
0.054
0.046
0.038
0.030
Percent Uninsured
6
30
35
40
45
50
1990 2000 2010
3%
2%
1%
Uninsured increase from premium growth
Uninsured increase from other factors
10- Year projected uninsured for different rates of premium growth (% points):
Millions Uninsured
Projection of Number of Uninsured
7
MEDICARE SPENDING AND QUALITY
Overall quality ranking
1
11
21
31
41
51
3,000 4,000 5,000 6,000 7,000 8,000
Annual Medicare spending per beneficiary (dollars)Baicker and Chandra, “Medicare Spending, The Physician Workforce, And Beneficiaries’ Quality of Care,” Health Affairs Web Exclusive, April 7, 2004
NH
HI
VTME
UT IAND
WI
LATX
CANU
ORMN
MT
COCT
VAWA
SD
MA
RI
NEDE
ID NC WY NYMDMIMO
PA
INAZ KS
SC AKWV NVNM
OH TNKY AL
OKILGAAR MS
FL
8
The Difficult Facts• The population will age, driving costs
• The working population will be unable to subsidize the system
• Doctors and hospitals will continue to import technology to increase income, increasing costs
• Many entrepreneurs will attempt to disaggregate the hospital
• Hospitals will struggle to maintain positive margins
• The will in turn negatively impact quality and access
9
U.S. Population of Persons age 65 and Older: 1990 - 2050
0
10
20
30
40
50
60
70
80
90
1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050
Age 85 and older Age 65 to 85
SOURCE: US Census Bureau, Statistical Abstract of the United States, 1996.
Mil
l ion
sM
i ll i
ons
10
The Shrinking Financial Base for Medicare
Ratio of working age to elderly Americans
2.8
4.9
0
1
2
3
4
5
2000 2010 2020 2030
Source: U.S. Bureau of the Census
RATIORATIO
YEARYEAR
11
Inpatient Demand Rising As Population Ages
190 323575
1412
2473
3687
<15 years 15-44 years 45-64 years 65-74 years 75-84 years +85 years
2% 50% 50% 53% 105% 245%
Pop. CohortGrowth1970-2002
Sources: CDC, National Center for Health Studies
Inpatient Days/1,000 population (2002)
(By age cohort)
12
Projected Medicare Spending under Bush Administration Budget, FY 2001-2011
$216 $226 $239 $252$279 $292 $314 $336 $358 $384
$419
$13$13$8
$16$17
$20
$24
$0
$250
$500
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Baseline Spending Additional Spending for MedicareModernization/Prescription Drugs
Note: Numbers for proposed reform do not add to $110 billion due to rounding.
SOURCE: OMB, April 2001.
(Projected annual
increase of 6.6%) (~$110 billion, 2005-2011)
Billions ofDollars
13
$298
$129
$0
$100
$200
$300
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Federal Medicaid Spending is Expected to Increase Over Next 10 Years
SOURCE: OMB, April 2001
Billions of DollarsBillions of Dollars
14
Annual Change in U.S. Per Capita Health Spending by Service: 2001-2004
0%
2%
4%
6%
8%
10%
12%
14%
16%
AllServices
HospitalInpatient
HospitalOutpatient
Physician Drugs
2001200220032004
+32%+45%
+60%
+31%
+50%
Source: Center for Studying Health System Change, June 2005, Data Bulletin No. 29
15
Change in Premium Costs and Earnings, 2000 to 2005
$4,442
$1,094
$4,389
$0
$1,000
$2,000
$3,000
$4,000
$5,000
Average Growth in FamilyPremium
Average Growth in WorkerContribution to Family
Premium
Average Growth in Earningsfor Non-supervisory
Workers
Source: KFF/HRET Survey of Employer-Sponsored Health Benefits, 2000 and 2005; earnings growth from Kaiser Family Foundation calculations based on Bureau of Labor Statistics data assuming 2080 hours worked per year
16
2005 Annual Premiums for Individual Health Insurance as Percent of Median Family Income
in Massachusetts
17%
25%21%
27%
0%
5%
10%
15%
20%
25%
30%
35%
40%
Family in 30s Couple in 60s
BCBSHPHC
Source: Division of Insurance and US Census Bureau. 2004 median income =$68,700
17
The percentage of US firms offering health coverage has fallen significantly over the
last five years.
Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits: 2000-2005
18
19
How Will We Control Costs?
1. Manage care: Doctor-based rationing
2. Restrict technology: System-based rationing
3. Under-insure: Patient-based rationing
4. Pay for performance: Weak doctor-based rationing
20
Managed Care
• Market incentives in the doctor/patient relationship
• It appears to have worked in the mid 1990s
• But consumer backlash/tort litigation led to a historic retreat
21
0 20 40 60 80 100
1988
1993
1996
1998
1999
2000
2001
2002
2003
2004
2005 Conventional
HMO
PPO
POS
Percent
Change in Health Plan Type
22
Increases in Health Insurance Premiums Compared to Other Indicators, 1988-2002
12.0
18.0
14.0
8.5
0.8
4.8
8.3
11.0
12.7
0
2
4
6
8
10
12
14
16
18
1988 1989 1990 1993 1996 1999 2000 2001 2002
Health InsurancePremiumsMedical Inflation
O verall Inflation
SOURCE: Kaiser/HRET Survey of Employer-Sponsored Health Benefits: 1999, 2000, 2001, 2002 …
* Estimate is statistically different from the previous year shown: 1996-2000, 2000-2001, 2001-2002.
Note: Data on premium increases reflect the cost of health insurance premiums for a family of four.
**
**
****
23
Backlash Against Insurers Intense
-45%
-30%
-15%
0%
15%
30%
45%
60%
75%
1997 1998 2000 2001 2002 2003 2004 2005
Positive Rating
Negative Rating
Good Job Minus Bad Job, 1997-2005 by Industry
Source: Harris Interactive, Vol. 5 Issue 4, May 11, 2005
24
All Care Became Managed
446413
307 294 287 295 304
358
282247 240 249 256 268
1993 1995 1997 1999 2001 2003 2004
“Unmanaged”
“Tightly Managed”
Used to fund richer outpatient benefits
Souree: Milliman, Inc.
Inpatient utilization, 1,000 lives/year
25
Restrict Technology
• Very difficult in United States
• Industry influence is deep
• Tide has been in the direction of weaker CON laws
• Rhetoric of market competition is high: need technology to compete
26
0
2
4
6
8
10
12
14
16Lowest quintile Middle quintile
Highest quintile
Lowest quintiles Middle quintiles Highest quintiles
Quintiles of per capita hospital bed supply
1.00
1.001.00
1.07
1.18
1.10
1.301.09
1.34
Quintile of medical specialist supplyDollars per enrollee (thousands)
Costs Related to Hospital Capacity and Medical Specialists
28
Under Insure: Patient-Based Rationing
• Occurs under the guise of consumerism claims
• But presumes that patient/consumer has real choice and that costs of health care are within reach of average family income
• Nonetheless, represents an easy choice
29
Employer Interest in Cost Reduction Measures(5=Very Interested, 1=Not Interested At All)
4.54.2
3.4 3.3 3.2
2.32
0.0
1.0
2.0
3.0
4.0
5.0
Cost Sharing ForRx
Cost Sharing ForMedical
EducateConsumers
Raise OOPLimits
Higher FamilyPremium
DefinedContribution
Plans
ReduceMD/Hospital
Choices
Sources: Milliman USA 2002 HMO Intercompany Rate Survey
30
“Consumer-Driven Health Plans” A Smokescreen
• Shifting costs, not influencing demand, is the real motive
• Current copayments already have consumer’s attention—additional elasticity of demand diminishing
• Real quality measures too complex for typical consumer…rational choice an unrealistic expectation
• Actuaries credit consumer plans with very little utilization saving
• Contributions to HSAs now under employer’s control
• Risk for inflation shifts to consumer
• Moves market away from unsustainable entitlement view
• Softens consumers for further benefit retrenchment
31
0
20
40
60
80
100
Large firms (200 or more workers)
All firms
Smallest firms (3-9 workers)
Percentage of Workers with Health Insurance
(by firm size)
32
New Arrival: “Underinsurance Plans”
Increasingly common benefit plans that look normal on the surface, but have extraordinarily low internal limits that
expose covered individuals to catastrophic losses
From Florida:
• $100 deductible• 80% of “covered services” in
excess of deductible• Maximum out-of-pocket for
“covered services” = $2,000/year
“Covered Services” Limits Patient is uninsured for• $600/day inpatient R&B hospital costs in excess• $1,200/day ICU R&B of R & B per diem plus• $2,000/year everything else $2,000/year for all other
charges
Nominal Benefit Provisions (on the surface)
Internal Limits
(the fine print)
33
Americans Are Living On The Edge
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
'80 '04
$8,822
$29,372
0%
2%
4%
6%
8%
10%
12%
Personal income is up…
…but savings are down
Source: U.S. Bureau of Economic Analysis
10.0%
1.2%
34
Community Response: Cherry Picking
17%
24%
Non-MedicareTransfers
Medicare Transfers
41%
Soutce: UHC Clinical Data Base
Percent Change in Transfer Patients
Medicare vs. Non-Medicare, 2001-2003(52 UHC Members)
35
Source: Forrester Research, 2003
CDHC Market Share
0%
25%
50%
75%
100%
POSPPOHMOConventionalConsumer-directed health plans
2004 2006 2008 2010
Consumer-driven products are poised for growth
36
Pay for Performance
• At present, it is characterized primarily as a quality issue
• But in the future, will likely be combined with price tiering to reward cost-effective doctors and hospitals
• Yet, who exactly will do this management
37
Lee, T. H. et al. N Engl J Med 2005;353:1202-1204
Are Consumers Sensitive to Quality Information?
Awareness and Use of Quality Ratings among the General Public
38
Proportion of Members of High-Deductible Health Plans and Other Privately Insured Patients Who Did Not Fill a Prescription Because of Cost.
Condition for Which Medication Was Prescribed
Patients Enrolled in Non-
HighDeductible Plan
Patients Enrolledin High-
Deductible Plan
percent
All 13 28
Diabetes 15 24
Depression 9 30
Arthritis 9 16
Chronic pain 9 23
Heart disease or hypertension 8 18
Allergies 8 23
Asthma 9 23
High cholesterol 2 16
Other chronic condition 17 25
39
All primary care residents
1995-96
43,760 total
2004-05
44,668 total
5.6% decrease
64.3%
58.7%
U.S. MD
U.S. DO
U.S. IMA
No U.S. IMAOther
40
Family medicine residents
1995-96
9,261 total
2004-05
9,373 total
Internal medicine residents
1995-96
21,071 total
2004-05
21,332 total
22.5% decrease74.2%
51.7%
0.3% decrease53.1%
52.8%
U.S. MD U.S. DO U.S. IMA No U.S. IMA
Other
41
Physician Pay
In 2004, median compensation for primary physicians grew at a faster rate than specialist pay for the first time in five years, according to a survey by the Medical Group Management Association
Physicians 2001 Change
2002 Change
2003 Change
2004 Change
Primary Care
$149,009 1.2%
$153,231 2.8%
$156,902 2.4%
$161,816 3.1%
Specialists $263,254 2.6%
$274,639 4.3%
$296,464 7.9%
$297,000 0.2%
42
Summary Diagnoses
1. Costs continue to rise due to demographics
2. Managed Care (MD-based) rationing is out
3. Market rhetoric overwhelms technology regulation
4. Underinsurance simply decreases access
5. Hospital impoverishment negatively affects quality and access
6. Physicians who might socially progressively compete under P4P are disappearing
43
Presumptuous Medical Ethics
• Doctor patient relationship is different than more commercial relationship
• Doctor owes duty to patient that is not defined by rights on contract
• That duty is based in altruism
• Physicians have to construct the institutions for medical care that promote this dutiful relationship
44
Medical Morality, Ethics and Professionalism
• Moral theory provides the basis for the relationship of duty and trust
• Morality is translated into principles by ethical reasoning
• Ethical principles are institutionalized by professional codes
• So… professionalism should reflect a moral view
45
Traditional Conception of Professionalism (Brandeis)
• Control over recondite area of knowledge• Responsible for training of next generation
of profession• Responsible for promotion of growth of
knowledge• Accountable to society for use of
professional advantages• Therefore, a strong sense of social contract
46
The (Overlooked) Structural Aspect of Professionalism
• Knowledge cannot be increased, and students cannot be trained in the absence of institutions
• Nor can care of patients occur in an isolation from institutions
• Therefore, professional principles must imbue and be reflected in the structure of care
• And, justice as the morality of institutions plays a role
47
Market Imperatives vs. Professionalism
• Emphasis on efficiency
• Competition tends to drown out other values
• Markets foment inequality
• Professional virtues rendered anachronistic
48
New View of Professionalism
• Must be tied to other-regarding values
• Morality gives rise to ethics give rise to professionalism
• Emphasis on market in managed care has largely evaporated professional qualities
• Do something now or you risk losing any value from professionalism
49
Traditional Professionalism
Stewardship of:Knowledge
Education
Doctor-Patient Relationship
Regulation
50
Civic Professionalism
Stewardship of:KnowledgeEducationDoctor-Patient RelationshipOrganization of Health Care
Recognition of:Monopoly powerResponsibility for social contract
51
Physician Charter
• Efforts of ACP/ASIM; ABIM; EFIM
• Initially largely undifferentiated effort; Europeans hit on the idea of a Charter
• Writing by committee required a year of review
52
Fundamental Principles
1. Primacy of patient welfare
2. Patient autonomy
3. Social justice
53
Social Justice Parameter Critical
• Not part of traditional medical ethics
• Have to be concerned not just about this patient; but class of patient
• We have responsibility for the organization of, and class of outcomes for, the universe of patients
54
Ten Professional Responsibilities
1. Honesty with patients
2. Patient confidentiality
3. Appropriate relations with patients
4. Improve quality of care
5. Improve access to care
55
Ten Professional Responsibilities (continued)
6. Just distribution of finite resources
7. Commitment to scientific knowledge
8. Maintain trust by managing conflicts
9. Commitment to professional competence
10. Adhere to professional responsibilities
56
Three Examples in Action
• Quality of Care - Medical Injury
• Luxury Primary Care
• Pharmaceutical Conflicts of Interest
57
HopkinsKerr White
John Williamson
Robert Brook
RAND
Joe Newhouse
Shewart/Deming
Mark ChassinShelly Greenfield
Jim Ware
DartmouthHarvard
Don Berwick
CQI
Wennberg
Medical Injury
Howard Hiatt
HSR
Short History of Quality Improvement
58
Professionalism and Quality
Charter Responsibilities:Professional competence
Honesty with patients
Responsibility for CQI
Appropriate access
Equitable distribution
59
The Roles of Physicians in Improving Quality
1. Develop national and local leadership to
emphasize the professional contract
2. Educate providers on the professionalism/quality
synergy
3. Aggregate providers to design improvement
strategies
4. Measure frequently and openly
5. Collaborate with payers and government
6. Be role models
60
Challenge of Preventable Medical Injury
California 1976
New York1
1984 Utah/Colorado2
1992
Adverse Event Rate 4.65 3.7 3.3
Negligent Adverse Event Rate
0.79
1.0
1.1
1NEJM 1991
2Medical Care 2000
61
Hospitalized Patients
Claims
No Adverse Events 2,573,253 2,267
Adverse Events 71,433 783
Negligent Adverse Events 27,177 625
TOTAL 2,671,863 3,675
Preventing Medical Injury: The Malpractice Backdrop1
1NEJM 1993
62
The Result of Our Historical Approach
• Malpractice disconnected from quality
care
• Almost no research on error prevention
• Secrecy still dominant
63
Deal with Medical Error
• Overcome the inertia of the profession
• Be open and measure
• Resist the pressure of malpractice concerns to drive error prevention underground
• Spend resources to accomplish
• Develop reporting mechanisms
64
Aspects of Luxury Primary Care
• Many fewer patients in practice
• Get large set of dues (fees) from willing
patients
• Continue to bill insurers
• Often add amenities
65
Attractive Features of Luxury Primary Care
1. More time for patients and doctors
2. Greater patient satisfaction
3. Great professional satisfaction
4. Fills a market niche
66
Luxury Primary Care: Business Plan
• Reduce practice size to 200 patients
• Charge $2,000 per head
• Bring in $80,000 in billing revenue
• Take home: $240,000 (50% overhead)
67
Unprofessional Aspects of Luxury Primary Care
1. Abandonment
2. Shifting of costs of care of poor to other
physicians—eliminate cross-subsidies
3. Lubricates slippery slope to two/three class care
4. Arguably bilks insurers
68
Professionalism and Symbolism
• Can we self-regulate luxury primary care?
• Are we not concerned about the symbolism of creating classes of care?
• Is there any cross-subsidy argument?
69
Pharmaceutical Conflicts of Interest
• Recent Federal prosecution of physicians based on Medicare fraud statute
• TAP Pharmaceutical use of free trips and educational grants is the most heavily cited precedent
• Led to settlement of $850 million and pending indictment of medical center leadership
70
Profession and PhRMA Have Reacted
• AMA has reissued conflicts of interest policy
• ACCME and ACP have developed new policy
• PhRMA has set forth guidelines
• Inspector General has issued guidance
71
Is More Stringent Regulation Needed?
• Recent psychological research reveals that small gifts do influence, and that disclosing conflicts is not effective
• Government enforcement through prosecution and fines suggests that professionalism has failed
72
A Charter-Based Proposal
Relationship
Current Recommendation
Stringent
AlternativeSmall Gifts Allowed at certain site Prohibited
Speaker Bureaus Allowed Prohibited
Support for Travel Allowed Only as contribution to general fund
No Strings Contracts Allowed General contributions
Support for CME Allowed General contributions
Research Contracts Allowed Allowed with public disclosure
Consultant Rules Allowed Allowed with public disclosure
73
The New Professionalism
• Requires an understanding that medical work is a vocation not a job
• Requires that we understand that our system of care is just as much a responsibility as is our care for an individual patient
• Requires activity as a collective, which requires leadership