It can sometimes feel like there’s nothing we can do to improve population health. That’s just not true. This is Healthcare Triage News.
For more information, go here.
It can sometimes feel like there’s nothing we can do to improve population health. That’s just not true. This is Healthcare Triage News.
For more information, go here.
Emma Sandoe is a PhD student in Health Policy, Political Analysis at Harvard and a former spokeswoman for Medicaid at the Centers for Medicare & Medicaid Services.
This week David Slusky and Donna Ginther released an NBER working paper which suggested that Medicaid expansion reduced the prevalence of divorce by 5.6% among those aged 50-64.
The thinking is this: Prior to the passage of the Affordable Care Act, the only way that many middle-income adults could qualify for Medicaid coverage was to spend down their assets to qualify for one of Medicaid’s eligibility groups. To avoid spending all of their assets on medical and long-term care services, many people engaged in what is known as “medical divorce.” When one spouse would become ill and need Medicaid services (particularly for long-term care services that Medicare does not cover), the couple would divorce so that the assets of the sick spouse would qualify them for the Medicaid asset test (often around $2,000 for an individual and $3,000 for a couple).
Medicaid expansion changed things. It allows all people regardless of assets to apply for Medicaid coverage so long as their income is below 138% of the federal poverty level. Using a difference-in-difference approach comparing changes in divorce rates (pre to post ACA) in states that expanded Medicaid eligibility to 138% of the poverty level to states that did not expand, the authors found that divorce rates fell in expansion states.
One problem is that Medicaid expansion did not entirely get rid of the asset test.
Medicaid is not one program. There are many avenues that a person can take to get Medicaid. The benefits and structure of the program look different for each eligibility group. Broadly speaking we can break Medicaid eligibility into modified adjusted gross income (MAGI) and non-MAGI eligibility.
The Affordable Care Act requires all states to use the MAGI to calculate the eligibility for certain types of applicants (pregnant women, children, and the newly eligible Medicaid expansion adult population). These populations receive benefits that are similar to private health insurance – hospital services, doctor services, and pharmaceutical drugs. They do not receive Medicaid long-term care services.
There are certain groups that are exempt from MAGI eligibility (referred to as non-MAGI). These are Medicaid programs for the blind, disabled, and those over 65. These groups receive long-term care services and for those services they were (and still are) subject to asset tests. Despite some spousal impoverishment protections, this is the population that would likely engage in medical divorces because private insurance and Medicare does not cover long-term care and Medicaid is the primary payer for long-term care services. Without Medicaid, people often pay up to $60,000-$80,000 annually for long-term care services which could impoverish families.
There could be some people that are early retirees or couples that might need cancer care or other expensive hospital procedures and would qualify for asset-test free Medicaid expansion, but these are likely rare cases linked to divorce.
The paper may benefit from looking at divorce rates for populations over the age of 65 in states that have expanded versus those that did not expand. This might provide a more complete picture since the population over 65 is likely to include some people who would divorce because of Medicaid asset test eligibility. If divorce rates decreased by a similar amount for this group as for the under-65 group the authors studied, that would suggest that there are other factors other than Medicaid expansion causing rates to fall (because Medicaid expansion did not apply to the elderly population).
Not only have (non-MAGI eligibility) asset tests not gone away, they’ve become more stringent. For example, in California, the asset test for a couple to qualify for Medicaid disability coverage was $3,000 in 2016. California has not increased that amount in nearly 30 years. The real value of that asset has halved since it was put into place in 1989. I wrote a longer explanation of this issue here.
The financial security that Medicaid provides does have large scale effects. Financial insecurity is a leading cause of divorce in the US. It is conceivable that there are more financially secure couples who are less likely to divorce because of the safety net of Medicaid expansion. Alternatively, there are many other causal factors that could be reducing divorce as the authors note, but unfortunately asset limits remain a hurdle for many couples to overcome to receive Medicaid services.
There’s just so much S#!T in the news every day that important stuff seems to fly under the radar. Like this:
A federal appeals court cleared the way on Thursday for Florida doctors to talk to their patients about gun safety, overturning a 2011 law that pitted medical providers against the state’s powerful gun lobby.
In its 10-to-1 ruling, the full panel of the United States Circuit Court of Appeals for the 11th Circuit concluded that doctors could not be threatened with losing their license for asking patients if they owned guns and for discussing gun safety because to do so would violate their free speech.
I’ve written a number of times, most importantly in the NYT, about the laws in some states (like Florida) that attempted to prohibit doctors from talking to their patients about gun safety. My prior pieces stand.
The bottom line is that trying to restrict what doctors can talk about was found to violate First Amendment rights of physicians. The appeals court did find that one part of the law, which said doctors can’t deny service to patients because they own guns, was constitutional. That wasn’t what this lawsuit was about, but that much stands – appropriately.
Regardless, you can still lie to your doctor if you want, about guns or any other issue; you’re not under oath. You can also refuse to answer any questions; you’re not under subpoena. Neither will help doctors to help you, but they’re entirely within your rights. Demanding doctors not ask you certain questions isn’t.
In yesterday’s post on my new draft essay, Federalism and the End of Obamacare, I emphasized the benefits of returning more regulatory authority to the states. Today, I’d like to draw out a different point: the need for the federal government to take the lead when it comes to financing health reform.
The states face two enormous obstacles to achieving near-universal coverage on their own. First, the states don’t have the same fiscal capacity as the federal government. Keep in mind that the ACA is a large, countercyclical spending program:
When a recession hits, many people will lose both their jobs and their employer-sponsored coverage. The ranks of those eligible for Medicaid and for ACA subsidies will predictably grow, leading to larger federal outlays. At the same time, the economic downturn will depress tax revenues. The federal government can deficit-spend to manage these countercyclical fluctuations. The states, however, cannot. With the exception of Vermont, the states are legally obliged to balance their budgets every year. And states are understandably reluctant to adopt large obligations that will require savage spending cuts or hefty tax increases when times get tough. Cuts and taxes are not only unpopular, but they would also depress the economy further, exacerbating the recession. Broad coverage expansions thus commit states to an economic policy that could inflict serious damage on their residents.
Second, ERISA poses an enormous problem for states that want to tackle health reform.
No government, state or federal, likes to impose new taxes. But governments face a special challenge when their residents can complain that the new tax is discriminatory. That problem arises with particular force when states try to impose new taxes to finance a coverage expansion. A resident who gets health coverage through her job—let’s call her Anna—already faces a reduction in take-home pay commensurate with the value of that coverage. Another resident who works at a similar job but does not get health coverage—let’s call him Bob—likely receives higher cash wages. Should Anna and Bob both face the same new tax, even if it finances a coverage expansion that will only benefit Bob?
Penalizing employers who fail to offer health coverage to their employees avoids this problem. “Pay or play” laws thus have a clear political logic: employers that don’t offer coverage are failing to live up to their end of the social bargain. They have a certain economic logic, too: if Bob starts getting coverage through his employment because of a pay-or-play law, he will see an offsetting wage reduction, tying the costs of coverage to the person who receives it.
The trouble is that ERISA preempts state laws that “relate to any employee benefit plan,” including a plan offering health coverage. Although there is some legal uncertainty, preemption probably means that states cannot impose a penalty on employers that refuse to offer health coverage. By taking pay-or-play laws off the table, ERISA complicates the politics of financing state efforts to achieve near-universal coverage.
Taken together, these legal obstacles—state balanced-budget rules and ERISA—will predictably frustrate state efforts to achieve near-universal coverage. (Massachusetts and Hawaii, as I discuss in the essay, are the exceptions that prove the rule.) Federal money is thus the lifeblood of health reform; the states can’t go it alone.
That’s the title of my new essay, which the Yale Law Journal Forum has published in draft form. Here’s the abstract.
Federalism has become a watchword in the acrimonious debate over a possible replacement for the Affordable Care Act (ACA). Missing from that debate, however, is a theoretically grounded and empirically informed understanding of how best to allocate power between the federal government and the states. For health reform, the conventional arguments in favor of a national solution have little resonance: federal intervention will not avoid a race to the bottom, prevent externalities, or protect minority groups from state discrimination. Instead, federal action is necessary to overcome the states’ fiscal limitations: their inability to deficit-spend and the constraints that federal law places on their taxing authority. A more refined understanding of the functional justifications for federal action enables a crisp evaluation of the ACA—and of replacements that claim to return authority to the states.
The upshot of the piece is that there’s much to be said—more than the ACA’s supporters generally acknowledge—for returning power to the states. That’s so even with respect to some of the ACA’s most sacrosanct provisions:
[C]onsider the ban on medical underwriting. The ACA reflects the judgment that it is unfair to deny coverage to the sick or to ask them to pay more for their coverage. The ACA thus embraces policies—in particular, the much-maligned individual mandate—that its drafters thought necessary to cope with the risk that people will wait until they got sick to purchase coverage. For the ACA’s supporters, the individual mandate is a reasonable price to pay to prevent discrimination against the sick. But many people don’t see it the same way. Some reject the claim that the government should be in the business of guaranteeing coverage for everyone. Others don’t think that medical underwriting, however distasteful, warrants a heavy-handed purchase obligation. Still others doubt that the individual mandate is strictly necessary to prevent adverse selection, and would prefer less-intrusive alternatives. If those who disagree with the ACA’s approach command the levers of political power within a state, why shouldn’t those states be allowed to try something different?
The argument can be generalized to most of the ACA’s insurance reforms. And I can already hear the response: Because this “something different” will not work. The ACA’s opponents are completely unrealistic about the tough tradeoffs that health-care policymaking entails. They will take federal money and squander it, leaving millions of people without coverage.
That might be right; indeed, I suspect it is right. But that’s my judgment. Lots of smart people do not share that judgment. And if federalism means anything, it is that national judgment should not supersede state judgment, absent a good reason for federal intervention. Yes, federal money might be squandered in a state that adopts stupid insurance rules. People could go bankrupt and even die as a result of the lack of coverage. But that’s an issue between the state and its voters. If other states use the money more effectively, the state with the stupid rules will come under pressure to improve them. And what if it turns out that what seemed stupid is not so stupid after all?
Democracy rests on the conceit that we all have an equal voice in determining what the good is, which is why Michigan voters don’t get to tell Ohioans how to spend their tax dollars, even if Wolverines know in their hearts that they make better decisions than Buckeyes. And while the federal government can make decisions for Ohio, it should not do so just because it doubts the wisdom, intelligence, or values of Ohio residents. “The states have bad ideas” is a poor justification for federal law (unless, again, those bad ideas turn on views about the inferiority of minority groups). Federalism thrives when we recognize the limits of what we know, appreciate that good people can hold views that many others find repugnant, and acknowledge that our own misconceptions and prejudices can blind us. Sometimes federalism means letting the states wave their crazy flags.
I’d welcome any suggestions and criticisms. And a big thank you to the Yale Law Journal, which has moved with stunning speed to get the piece up.
The following originally appeared on The Upshot (copyright 2017, The New York Times Company). It was jointly authored by Austin Frakt and Jonathan Skinner. It also appeared on page A3 of the February 14, 2017 print edition. Click through to the original post to see a video of changes in geographic variation in back surgery rates over time.
You might think that once drugs, devices and medical procedures are shown to be effective, they quickly become available. You might also think that those shown not to work as well as alternatives are immediately discarded.
Reasonable assumptions both, but you’d be wrong.
Instead, innovations in health care diffuse unevenly across geographic regions — not unlike the spread of a contagious disease. And even when studies show a new technology is overused, retrenchment is very slow and seemingly haphazard.
Back surgery is a great example. In the early 1990s, when John Wennberg’s Dartmouth Atlas of Healthcare first started tracking treatment rates among older Medicare users, back surgery was relatively uncommon; 1992 rates were as low as one case per thousand in cities as diverse as New York and Johnson City, Tenn.
By 2006, average rates of back surgery had increased to 4.9 per thousand. The procedure had spread rapidly across the Northern Plains and Mountain States. Growth was especially significant in certain cities elsewhere — like Lubbock and Harlingen, Tex. Yet rates in New England and some parts of the Midwest had barely budged.
Even as back surgery’s popularity as a treatment for back pain began to rise in the 1990s, there was little solid evidence of its effectiveness. It wasn’t until 2006 that the first large randomized trial on the subject was published.
That study showed relatively modest benefits of surgery for many conditions that lead to back pain. While many patients felt better after a year, so did a nearly equal proportion of people in the control group who didn’t have surgery. However, years before that evidence was available, some regions had adopted back surgery at a high rate, while others had not.
The rates of back operations performed in hospitals began to flatten after 2006, but little was known about growth in the treatment in outpatient clinics, the same-day facilities with greater convenience and lower costs. Recently, Brook Martin and Sandra Sharp, two Dartmouth researchers funded by the National Institute of Aging, tracked outpatient as well as inpatient procedures through 2014. The finding: Rates of Medicare back surgery had grown 28 percent since 2006, with no decrease in regional variations; rates in 2014 ranged from 3 per 1,000 in the Bronx to 11.5 per 1,000 in Casper, Wyo.
The puzzling thing is why back surgery became more popular in certain broad regions, but not in others. Why, for example, did rates grow so rapidly in the Northern Plain states while rates in New England barely budged?
Our best guess comes from a study by Harvard and Dartmouth researchers, not on back surgery, but on cardiac treatments. It found that regional variation in Medicare spending is associated with variation in physician preferences for intensity of cardiac treatments, and to a greater degree when the evidence is ambiguous. Patient preferences exerted almost no influence. It’s likely that the pattern holds for back surgery, too, though it has not been studied in the United States.
It’s tempting to conclude that there are simply regions where the intensity of care of all types is higher — that some regions invest in all of the latest shiny technologies, while others don’t. This is too simple; Miami and McAllen, Tex., the two most expensive regions in the United States for overall Medicare spending, also clock in with among the lowest spine surgery rates. Instead, we see what Mr. Wennberg calls a surgical signature: Casper Wyo., has the highest back surgery rate in the country, but its cardiac bypass surgery is well below the national average.
This puzzling pattern once again points toward idiosyncratic physician beliefs. Orthopedic surgeons in a particular hospital may be more aggressive, while the cardiologists there are less so.
Though we can’t say this is the answer with 100 percent certainty, we can rule out some other explanations. One is how much surgeons are paid. Since Medicare pays the same price for the procedure (adjusted for cost of living) across the country, prices can’t explain the paradox. The high rates in Denver could also be explained by back pain sufferers who flock to star surgeons and well-known hospitals there, but this doesn’t hold water either. The way the statistics are compiled, if a medical tourist traveled from Des Moines to Denver, the Medicare record keepers would assign that operation back to the tourist’s home in Iowa.
Maybe it’s differences in health. Perhaps areas with rapid growth in back surgery were those where more people had back pain. Yet northern New England retirees had similar histories of hard physical labor in farming, lumbering and manufacturing, and were no more affluent than their counterparts in the Northern Plains states.
Another explanation might be that patients prefer surgery in some regions of the country. One study observed large variations in back surgery across small regions in Ontario, but these weren’t explained by patient preferences. That study, like others, found physician beliefs about the benefits of surgery were associated with surgical variations.
If physicians are driving back treatment choice, even for procedures not supported by evidence, what can be done? One approach is to provide patients with unbiased information about the potential benefits and risks of back surgery relative to nonsurgical therapy so they can make informed choices. But the concern remains that for people in intense pain, when the doctor says that “I get good results with surgery, and my patients generally feel much better,” the back surgery option, with little out-of-pocket cost, will be hard to resist.
Another option is for hospitals or insurance companies to audit outlier physicians, as in a recent example of a back surgeon with a pattern of unusually high billing. In his audit, nine of 10 procedures were deemed not medically necessary.
A third option is to push people toward high-quality back surgery centers. Walmart created a network of high-quality spine centers for its employees that includes Virginia Mason Hospital in Seattle and the Mayo Clinic. It charged hefty co-payments to anyone getting surgery outside the network. The company found about a third of referrals didn’t need back surgery.
Often discussed, the big challenge in health care is to reduce spending by cutting wasteful care. It seems just as important, though, not to let more waste creep in as it did with back surgery. Once it spreads widely, it’s very hard to undo.
Adverse drug events are a big deal, impacting half of hospital stays for adults 65 years old and older. My latest AcademyHealth post covers some of the other stats and issues.
Marijuana! You guys always want to know more about pot from Healthcare Triage. It’s also one of the most controversial and complex subjects we cover. And it’s time for an update on what we know, versus what we think, when it comes to the drug.
That’s the topic of this week’s Healthcare Triage.
In response to a scathing report by Kaiser Health News, Senator Charles Grassley has announced an inquiry into the exorbitant prices for orphan drugs. Now seems like a good time to re-up my series on how to think straight about orphan drugs:
As a bonus, I’m also linking to a short, draft paper on orphan drugs that I compiled during my stint at the World Health Organization. It hasn’t found a home yet, but I’ll try to get it published soon. (Comments are welcome.) Here’s the takeaway:
Some orphan drugs are immensely valuable, but many of the most valuable would have been developed even in the absence of orphan drug legislation. At the same time, manufacturers can receive orphan drug approval for repurposed drugs and for drugs that are sold to large numbers of people, which in turn fuels high prices for orphan drugs. Those prices strain pocketbooks in the developed world and leave patients in low- and middle-income countries with no way to access them. The costs of orphan drug laws may well outweigh their benefits; at a minimum, reform is needed.
In particular, terms of regulatory exclusivity should end when a drug is prescribed to a patient population exceeding the orphan-drug threshold—in other words, when the drug is no longer an orphan drug. EU law already allows a reduction of the exclusivity period to six years when a drug is deemed sufficiently profitable, but the authority has not been exercised. In addition, exclusivity should be available only where a manufacturer has developed a genuinely new compound, not when it has repurposed an old drug.
Manufacturers should also be required to pay back R&D subsidies once drug sales exceed any plausible estimate of development costs. In Japan, for example, manufacturers must repay R&D subsidies for drugs with annual sales that exceed 100 million yen (Wellman-Labadie 2010). The same approach should be adapted elsewhere.
It is crucial to recognize, however, that reforming orphan drug laws may not much reduce the prices of orphan drugs. Most would still be patented and the demand for the drugs would still remain high. To reduce prices, payers will have to consider the value of the drugs that they purchase. Where an orphan drug is not cost-effective—where yields only incremental health improvements at an enormous price tag—payers must be empowered to say “no.” Some governments have taken steps in that direction. Sweden, for example, has declined to pay for about half of newly approved orphan drugs (Garau 2009). If a critical mass of developed nations followed Sweden’s lead, drug manufacturers would come under considerable pressure to cut their prices.
I spend a lot of time knocking supplements for not having research behind them. It’s important therefore to highlight when such research is done.
If you want to read more, here’s the paper we’re covering: Effect of Fish Oil Supplementation and Aspirin Use on Arteriovenous Fistula Failure in Patients Requiring Hemodialysis: A Randomized Clinical Trial