Impact Insights

Week in Review 12/5/14

Per a new report from CMS in Health Affairs, U.S. healthcare spending increased 3.6% in 2013, but growth was down from 2012, when spending increased 4.1%. In fact, Modern Healthcare reports that the rate of healthcare spending growth in 2013 was actually the lowest in more than 50 years. According to CMS, the decline in growth “coincides with modest overall economic growth since the end of the recent severe recession.” Overall, U.S. healthcare spending increased to $2.9 trillion – or an average of $9,255 per person (!) – in 2013.

Impact Advisors’ Thoughts: The decline in healthcare spending growth has gotten a decent amount of news coverage, but it is important to remember the drop is not attributable to only one factor. For example, a bit of the decline can be attributed to cost control efforts (reductions in unnecessary readmissions, duplicate tests, etc.). Some of the decline in spending growth was also a result of lower demand for healthcare services by patients due to changes in coverage. Those are just two (of many) contributing factors, but they illustrate just how complex and multifaceted these numbers are. For further reading, we recommend this article in the WSJ by Drew Altman of the Kaiser Family Foundation.

 

April Fools in December? After delaying ICD-10 one year on April 1, 2014, could Congress really be planning on yet another change to the deadline? As unbelievable as it sounds, some groups are pushing to get language establishing a two-year delay inserted into an already contentious appropriations bill that is considered “must pass” legislation in the current session of Congress. According to the story from Government Health IT, ICD-10 language could also potentially be inserted into certain bills in 2015, such as the inevitable Sustainable Growth Rate patch expected this spring (similar to what happened in April 2014).

Impact Advisors’ Thoughts: We caution that as of yet, there does not appear to be any language about ICD-10 that has actually been attached to a bill Congress will vote on this session. That being said, it seems like groups opposing the transition will continue to look for opportunities to do so – at least in the near term. Unfortunately, it is impossible to predict what will happen … but the next few weeks should be telling.

 

The actual impact of HIEs on healthcare quality and costs needs to be more thoroughly researched, according to a “systematic review” of 1,300 studies and other documents published in the Annals of Internal MedicineAccording to Modern Healthcare, based on the limited evidence available, researchers concluded that HIE use “probably reduces ED usage and costs in some cases” but that “effects on other outcomes are unknown.” Overall, of the 100 operational HIEs identified by the authors, independent research had only been done on 14 to determine if providers were actually using the capabilities.

Impact Advisors’ Thoughts: Given the attention and funding HIEs have received in the last few years – not to mention the well-known barriers that continue to persist – we are surprised more independent research hasn’t been done, particularly by the federal government and advocacy groups (who are responsible for a good amount of that attention and funding). It is unfortunate because we suspect there are important insights that could be gained from truly qualitative and objective research on operational efforts.

 

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