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38 Hartford Business Journal • decemBer 28, 2015 www.HartfordBusiness.com BOOK OF LISTS 2015-2016 Health Care 2016 HEALTH CARE OUTLOOK Coverage doesn't equal access By Elliot Joseph, President and CEO, Hartford Healthcare E ven as our nation continues to expand insurance coverage through Medicaid, here in Con- necticut we could see less access to care. Let me be clear: Providing our most vulnerable individuals with insurance coverage through the state-federal Medic- aid program is absolutely the right thing to do. Connecticut should be proud for being among the first states in the nation to add lower-income adults to its Medicaid plan. We need, however, to make a crucial distinction between simply providing coverage and ensuring affordable access to medical care. Access requires fair payment for the services provided. That's not the case in Connecticut. The state's hospitals are now paid 33 cents for each dollar of cost to treat Med- icaid patients. At the same time, the num- ber of Medicaid patients is increasing — now one in five Connecticut residents, double what it was at the start of 2010. Simple logic dictates that below-cost pay- ments and increasing demand for servic- es create an unsustainable combination. In 2016, our state will face a deci- sion that will affect the future of health care in Connecticut. If payments remain below cost, we will see services cur- tailed and jobs lost. All the talk about insurance expan- sion will be but a hollow promise, as access to care for the neediest and most vulner- able people in Connecticut will decline. Paradox- ically, this would lead to higher healthcare costs overall as chronic conditions go untreated and emergency department visits begin to rise. We are grateful that legislators lis- tened and eventually restored a portion of the most recent Medicaid cuts, but no one should believe the underlying prob- lem is resolved. Rates are far below cost, and reimbursing hospitals for care they already provided should not be a matter of debate. The year of the customer The year 2016 will also be the year of the healthcare customer. I say "customer" and not "patient" to make a point. One key aspect of the change in health care is what is being called the "activated consumer." In a traditional market, goods or ser- vices are exchanged by buyers and sellers, with the buyers then typically owning or using those goods or services. But with the advent of generous employer-provided health plans during World War II, the buyer of health care (the employer) was not the user of the service. This led to lots of over- use — and oversupply — of unnecessary medical services, and it is one of the rea- sons the U.S. has the highest per-capita medical costs in the developed world. This is rapidly changing. Healthcare consumers now have more skin in the game. From 2010 to 2015, the average employee cost of family health care has jumped 43 percent. Connecticut ranks ninth nationally for its percentage of commercial enrollees in high-deductible plans. In other words, the people using health care are, increasingly, paying for it themselves. They are looking for — shopping for — value. They get help from online informa- tion, often supplied by their employers or by their health plans. In addition, they can look at rankings provided by Con- sumer Reports or the LeapFrog Group. Healthcare providers are moving quickly to meet the activated consumer — with conveniently located primary care and urgent care centers, customer- friendly hours and online options. n Medicaid's progress and fragility By Ellen Andrews, Executive director, Connecticut Health Policy Project T he best-kept secret in Connecti- cut's healthcare landscape is our Medicaid turnaround. In the last four years access to care is up, quality is improving, and costs are under control. Things are far from perfect and there is lots of room to improve, but Medicaid is moving in the right direction. Provider participation is up 32 percent, which is very timely as we added over 100,000 people to the program that now covers one in five state residents. Fewer Medicaid members rely on the emergency department for routine health problems and more people are getting preventive care. The total per-person cost of care has consistently trended down, by 4.1 percent just last year. Total state spending on Med- icaid dropped 4.2 percent last year. We didn't just bend the cost curve, we nailed it. We can thank federal largesse and the Affordable Care Act for part of that trend. But the sustainable downward trend came the old-fashioned way — by coordi- nating care in person-centered medical homes, targeting high utilizers with high- touch supports, and using data combined with intelligent analysis and planning. Other states are taking notes on our success. But prog- ress like that is always fragile. It will be important in the year ahead to ensure that Medicaid payment reform efforts are thoughtful and build on what is working so well. Adopting payment models No one disagrees that the way we pay for health care needs change. It's no surprise that paying for volume with no regard to quality doesn't work. Along with unsustainable cost growth, this payment scheme rewards overtreatment and waste that is harming our health. Change is imperative, but if we don't learn from our history we will repeat it. Managed care in the 1990's failed because care wasn't really managed. Despite evidence it wasn't working, policymakers were slow to regroup and fix the problems. Consumers and advocates grew increasingly concerned about underser- vice — the inappropriate denials of care. We were assured that health plans had no incentive to deny needed care, as people would end up in more expensive care. Unfortunately it didn't work out that way. Like the rest of the country, Con- necticut is reforming the way we pay for health care. The latest plan is now to shift financial risk onto providers in large networks hoping that is the key to lowering costs — and it may be. It makes sense that providers control the vast majority of healthcare spending. There are two ways to generate savings. The old way is to deny people care, regard- less of value. The right way is to reduce duplication and low-value care while help- ing people with tools to keep themselves healthy. Giving providers resources to sort out what care we really need and what is wasteful makes sense. They should be compensated for that hard work; sharing the savings is the least we can do. New data and analytical tools offer the potential to target resources where they are needed and to see problems earlier. But that is only half the solution — we also need the political will to make changes to the system when needed. Change is hard, especially in Connecticut. n The future of independent doctors By Matt Katz, CEO of the Connecticut State Medical Society T he future of the independent prac- tice of medicine in Connecticut should be one of growing concern for patients. Medical-liability rates for Connecticut physicians continue to be one of the primary reasons physicians give up the independent practice of medicine. Connecticut continues to be a "crisis" state for medical-liability rates, accord- ing to the American Medical Association. Faced with continuing pressure from the Connecticut trial lawyers to evis- cerate the minimal-liability protections Connecticut law affords to physicians, medical-liability rates will continue to drive independent physicians to give up their practice. The bureaucratic pressures facing inde- pendent physicians similarly provide a challenging prac- tice environment. The costs associ- ated with electron- ic medical records, m e a n i n g f u l - u s e requirements, often modified quality reporting measures such as the Physi- cian Quality Reporting System (PQRS), Value Based Payment Modifier (VBPM), and soon-to-be Merit-Based Incentive Payment System (MIPS), are staggering and leave the ability of physicians to practice indepen- dently in doubt, while creating questionable quality improvement. Private practice, independent phy- sicians have traditionally based their practices off of a fee-for-service model. The shift to value-based payment mod- els leaves many independent physicians unable to practice under this model and the often-burdensome requirements that come with these models of care delivery. Additionally, the proposed Anthem- Cigna merger will be a tremendous threat to the independently practicing physician as physicians will have even less leverage to negotiate sustainable contracts with mega-insurers. In order for the independent physician to survive and thrive in Connecticut, sig- nificant change is needed. The Connecticut State Medical Soci- ety will continue to support legislative changes that positively impact indepen- dent physicians, including vigorous oppo- sition to insurance company consolida- tion, so that physicians have a choice in where and how they practice medicine in the state of Connecticut for the benefit and betterment of patient care. n Ellen Andrews Matt Katz Elliot Joseph