The health care landscape is shifting and shifting quickly. The demand for better care at lower cost grows daily. In response, payers and providers are changing their models for delivering and financing patient care and counting on health IT to make everything work.

The following are the latest developments that not only signify those changes but offer payers, providers and other stakeholders insight into how to respond positively to the new demands.

Health Care Reform

41% of networks include 25% or less of the office-based physicians in the health plan's area.

Researchers from the Leonard Davis Institute of Health Economics at the University of Pennsylvania measured the size of provider networks available to individuals buying health insurance coverage through state insurance exchanges. They identified 355 networks available to individuals through “silver” level health plans sold by 251 carriers. The researchers found that 41 percent of the networks were small (PDF, 693 KB), or narrow, which they defined as including 25 percent or less of the office-based physicians in the health plan's service area. To make coverage affordable, meet the law's essential benefits requirements and maintain financial viability for the plans, experts predicted that provider networks would need to be narrow.

The takeaway: Well-functioning narrow networks will survive only if they are made more transparent to consumers and are regulated properly to ensure network adequacy.

10.2 million people enrolled and paid for health insurance coverage through state and federal health insurance exchanges as of March 31, 2015.

Recent figures released by CMS show that the number of people who enrolled and paid for health insurance coverage through state and federal health insurance exchanges as of March 31, 2015. Some 8.7 million, or 85 percent, received a federal tax credit to help them pay for their coverage. Those subsidies will continue after the U.S. Supreme Court upheld their legality (PDF, 212 KB) in the closely watched King v. Burwell case.

The takeaway: The average tax credit was $272 per month.

Population Health

$24.6 billion estimated value of non-profit hospitals' tax exemption in 2011.

With more people having health insurance, the level of uncompensated care, which is the combination of charity care and bad debt, should go down for providers. For tax-exempt, non-profit hospitals, that means finding other ways to justify their tax-exempt status under the federal tax code. A new study in Health Affairs estimated the value of non-profit hospitals' tax exemption at $24.6 billion in 2011. That's nearly double the $12.6 billion it was worth 10 years earlier in 2002. The researchers recommended that community health improvement, or population health, be recognized as measure of non-profit hospitals' community benefit contribution to justify their continued tax exemptions.

The takeaway: Another solid reason to launch a population health management program.

8.2% percent of adults who visited a hospital ER in six states between 2006 and 2010 were back in the ER within three days

Inpatient 30-day readmissions are top of mind because of the financial penalties instituted by Medicare and because of the quality of care and patient safety implications for hospitals. But what about returns to the hospital emergency room? A study by researchers published in the Annals of Internal Medicine found that 8.2 percent of adults who visited a hospital ER in six states between 2006 and 2010 were back in the ER within three days. Of those patients who returned, nearly one-third went to an ER at another hospital. The study concluded that the hospital ER revisit rate is much higher than previously thought. That means health systems must identify why that's happening and determine what they should do about this costly problem.

The takeaway: Start revaluating your quality of care in the ER; patient adherence to ER discharge instructions; and patient access to primary care following an ER discharge.

4.7% fewer all-cause ER visits for patient-centered-medical-home enrollees

One way to reduce ER revisits as well as hospital readmissions is the patient-centered medical home. Researchers studied the 3-year impact of a PCMH project serving the Northeast Pennsylvania market. They found that enrollees in two health plans cared for by 27 PCMH-designated primary care practices scored better on six quality measures than did patients cared for by a peer group of 29 non-PCMH-designated primary care practices in the same market. For example, the rate of all-cause ER visits for PCMH patients was 29.5 per 1,000 patients per month compared with 34.2 for non-PCMH patients. And the rate of all-cause hospitalizations for PCMH patients was 8.5 per 1,000 patients per month compared with 10.2 for non-PCMH patients.

The takeaway: PCMH may not be the answer for everyone. But it's clear from the results that coordinated care facilitated by payer-provider collaboration and fueled by electronically sharable patient data can have a positive impact on clinical outcomes and health care service utilization.

$564 million in financial support provided to the State HIEs

The HHS's Office of the National Coordinator for Health Information Technology has provided $564 million to the State Health Information Exchange (HIE) Program created as part of the HITECH Act in 2009, according to a 25-page report prepared for the ONC by National Opinion Research Center (NORC) at the University of Chicago. The report is a case study of HIEs in six states. NORC researchers said providers' HIE needs have moved well beyond connecting disparate health IT systems and meeting “meaningful use” criteria to obtain federal health IT subsidies. They said HIEs need to facilitate access to actionable patient data at any point of service along the care continuum (PDF, 598 KB). If providers can't get access to actionable data through public HIEs, they'll have to get it via private HIEs or other means.

The takeaway: The clinical and financial benefits of highly coordinated care are just too great to pass up in this era of value-based reimbursement.


$3.40 charged to patients for every $1 in cost

A few reminders to payers and providers that price transparency is not only here to stay but will continue to expand. A study in Health Affairs found that hospitals on average marked up their charges 3.4 times the Medicare-allowable cost. That means for every $1 in cost, they charged $3.40. The average markup at the 50 U.S. hospitals with the highest charge-to-cost ratio was 10.1. They charged $10.10 for every dollar in cost. Despite the markups, fewer patients had problems paying their medical bills, according to data released by the National Center for Health Statistics. It said the percentage of people under 65 in families who said they struggled to pay their medical bills dropped to 17.8 percent in the first six months (PDF, 214 KB) of 2014 compared with 21.3 percent in 2011. Separately, the NCHS said 36.9 percent of people under 65 (PDF, 641 KB) with private health insurance were in high-deductible health plans, or HDHPs, in 2014. That's up from 22.5 percent in 2009.

The takeaway: You will benefit financially by letting patients know up front what their costs will be and working with them to make informed health care decisions based on price and quality — better known as value.

70% of consumers surveyed want EHRs

With all the news about data breaches putting the personal medical information of millions of patients at risk, HHS' Office of the National Coordinator for Health Information Technology was curious to know whether people still wanted providers to share their health data electronically. The agency found that consumers strongly support EHRs and health information exchange despite the privacy and security risks (PDF, 839 KB). Some 76 percent of the more than 2,000 consumers surveyed want providers to continue to use EHRs and 70 percent want providers to continue to share their health data electronically.

The takeaway: There's a strong vote of confidence that providers should pay back with even stronger measures to safeguard protected health information.

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