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Small Step Service Design Thinking – The Case of the Nurse Practitioner in the Fire Department

By M2|2019-03-22T14:05:22+00:00March 20th, 2019|Health Care Trends, Innovation, Providers, Uncategorized|

Small Step Service Design Thinking – The Case of the Nurse Practitioner in the Fire Department

As we a couple weeks ago, M2 authored a chapter entitled “Using Small Step Service Design Thinking to Create and Implement Services that Improve Patient Care,” in Service Design and Service Thinking in Healthcare and Hospital Management published by Springer. Today we share highlights from the second case study we feature in the chapter.

Fire department or health care provider?

When most of us think of health care organizations, we tend to think of our own experience, perhaps our physician’s office building, or a Kaiser-like integrated health system campus. But the fragmented U.S. health care system also relies on a “safety net” that includes community clinics, public hospitals, local health departments, and the emergency medical system (EMS).

As in the rest of the nation, in Los Angeles, (the second largest city in the U.S with 4+ million people) the 9-1-1 system serves as a safety net for health and social issues in the community. Perhaps surprisingly, the Los Angeles Fire Department (LAFD) is a key component of the city’s health care safety net. “The LAFD is the largest provider of acute, unscheduled medical care in Los Angeles,” and of the more than 425,000 annual calls for service, 85% are for medical services, not fire.

What would fire response look like if you put the patient first?

In 2016, Dr. Marc Eckstein, medical director of the LAFD, led the development and launch of the nurse practitioner response unit (NPRU) pilot project. A great example of using small step service design thinking, the creation of the NPRU was driven by a deep understanding of the people the LAFD serves. Leaders of the NPRU explained their thinking in creating the healthcare innovation: “This challenge naturally summons the need to better understand who our clients really are, and how we can work with other community partners to more collectively match our collective response to each client.”

What the team understood from years in the field talking and working with residents of Los Angeles County was that community members trusted the LAFD and that is why they called. Further, the team recognized, “for those with lower socioeconomic status, the fire department is their only means of access to healthcare, and has been for a number of years.” Additionally, Terrance Ito, DNP, FNP-BC, the LAFD EMS Nurse Practitioner supervisor explained, “many of them lacked health insurance for a number of years—and having recently become insured, we’ve found that they’re having difficulty with healthcare navigation.”

Meeting patients where they are – literally and figuratively

The NPRU model is designed to intervene with patients as early as possible in the course of emergency care, in part by focusing on what are called “prehospital” encounters. In a report prepared for the California HealthCare Foundation and California Emergency Medical Services Authority by Dr. Kenneth Kizer and his colleagues, prehospital services can include transporting patients who don’t need emergency care to non-emergency department (ED) locations, refer or release individuals at the scene of emergency response, and/or addressing the needs of frequent 9-1-1 callers (or ED visitors) “by helping them access primary care and other social services.”

The NPRU is a converted ambulance that is staffed by a range of emergency professionals including firefighters, paramedics, and nurse practitioners. The missions of the NPRU include providing mobile urgent care at the scene of an emergency call, and comprehensively assessing frequent users of emergency services, then connecting them to care or social services, as necessary.

A small step service design change, the NPRU allows patients to be served where the ambulance goes – often to a person’s home after he or she has called 9-1-1, instead of transporting the patient with little thought to where the patient can best be served. Notably, in February 2019, the Centers for Medicare and Medicaid Innovation announced a new payment model that will support exactly this kind of health service innovation. The Emergency Triage, Treat and Transport (ET3) Model will allow providers serving Medicare beneficiaries to be reimbursed not only for ambulance services to hospitals, but also for transport to lower level sites of care, for example a physician’s office or urgent care clinic. The ET3 Model would also allow reimbursement for models such as the LAFD NPRU that treat “in place with a qualified health care practitioner, either on the scene or connected using telehealth.”

Our book chapter on using small step service design thinking in health care used two case studies to highlight not just theories, but models that have been tested and proven effective in improving patient care. These models mirror what we hear from patients in our client work – ask us what we think would improve patient care and create policy accordingly. This simple idea drives our work every day. We hope you will consider it in your health care policy work as well.

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Small Step Service Design Thinking – The Case of the Patient Appointment

By M2|2019-03-15T15:51:47+00:00March 13th, 2019|Physician-patient communication, Providers, Uncategorized|

Small Step Service Design Thinking – The Case of the Patient Appointment

As we last week, M2 authored a chapter entitled “Using Small Step Service Design Thinking to Create and Implement Services that Improve Patient Care,” in Service Design and Service Thinking in Healthcare and Hospital Management published by Springer. Today we share highlights from the first case study we feature in the chapter.

Big leap versus small step service design

“At the heart of design thinking is the intention to improve products by analyzing and understanding how users interact with products and investigating the conditions in which they operate,” explain Rikke Dam and Teo Siang in a piece published by the Interaction Design Foundation. In health care, understanding how users interact is often the purview of engineers or project managers looking to improve the waiting room experience, or decrease wait times. We call these “big leap” service designs because they take significant time, commitment, and funding from health care organizations.

A small step design, we argue, truly aims to understand the patient’s point of view, instead of forcing a person to work around a process designed to make things easier for health care providers or organizations.

Patient appointments – boring but essential

While the health care system is moving away from fee-for-service reimbursement, it is still the dominant payment approach in the U.S. This means unreimbursed services, for example, setting appointments, are often outsourced to patients. From a patient’s point of view, not scheduling an appointment, or not showing up for one, can mean diagnosis or treatment delays which can lead to worse health outcomes. From a systems perspective, missed appointments are costly and inefficient. Perhaps most importantly from a design perspective, research shows that missed appointments are often blamed on patient inaction which can cause providers to develop negative attitudes and feelings toward patients leading to a decrease in communication and lack of empathy. Missed appointments can also lead to “increased costs of care delivery…reduced patient satisfaction and negative relationships between patients and staff.”

In a fee-for-service environment in particular, it makes sense from the point of view of the provider to recommend a follow-up appointment or make a referral for care, and expect the patient to book the appointment. But appointment nonadherence is a major problem in the U.S. health system with estimates ranging from 20 to 80% appointment nonadherence depending on the type of condition, site of care, and patient demographics.

Is this a people problem, or a process problem?

Since it benefits the patient, it seems obvious that he or she would set a recommended follow-up appointment, or appointment with a practitioner that has been referred to him or her by her current provider. But we know the frequency at which this doesn’t happen is quite high. As Chip and Dan Heath encourage readers to understand in Switch: How to Change Things When Change Is Hard, we may be attributing the patient’s behavior to “the way they are, rather than to the situation they’re in.”

First, let’s empathize.

Design system thinking recommends defining the problem by first empathizing with the end user. A large accountable care organization (ACO) in the Northeast we studied for the book chapter realized they were not immune to the problem of missed appointments, and recognized it was preventing their organization from helping patients achieve optimal outcomes.

The ACO’s small step service design innovation started with empathy. The ACO first worked to understand why their patients failed to follow-up on referrals. If you are not a patient, the answer may surprise you: Patients didn’t feel like they had the expertise to make the best choice.

From a patient’s point of view, they want the best care they can access, of course, but they don’t necessarily know what the “best” care is, or which providers are able to deliver that care for their particular set of circumstances. Further, a list of referrals with several provider names patients are often handed at the end of an appointment can make this anxiety worse. What tools does a patient have to discern between the providers on the list? Is there a difference in quality? Price? Years of experience? Bedside manner? Cultural competency?

Patient-first design extends clinical expertise

The small step service design tested by the ACO in our case study was a coordinated appointment and referral system (ARS). Driven by research showing a patient is more likely to attend a clinical appointment if that appointment is set before the patient leaves the office of the current clinician visit, the clinical leader of the ARS worked with colleagues to pilot a referral and appointment-setting process at the ACO that changed internal processes so patients left appointments with a follow-up or referral appointment already scheduled.

Our case study of the ACO in the Northeast provides a more complete picture of the design steps they used to create a unique appointment and referral system to improve patient adherence to referrals and follow-up appointments. While not the subject of this blog, it should be noted that empathizing with patients was just the first step of the process. Encouraging providers to be more involved in the appointment setting and referral process required building the case for chance across a broad range of internal stakeholders, not the least of which were the staff and clinical experts who would be asked to help patients make this important choice. The goal was to take some of the work off the patient’s plate, but this required building the case with the ACO’s doctors and health care providers for why they should do something differently.

The clinical expert leading the effort explained to us, “I try to tell doctors that we have insider access as clinicians. We get preferential treatment when we are trying to interact with the system. Imagine extending that reach for our patients.”

Through a provider’s eyes, it seems obvious that patients should schedule appointments the provider recommends. But through the patient’s eyes, it becomes more clear that the barriers to appointment-setting may have less to do with lack of interest and more to do with lack of expertise. Extending clinical expertise and “insider access” to patients to improve the rate of appointment setting may seem like a mundane process change, but the ACO in our case study thinks it will have an outsize impact on patient outcomes.

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M2’s new book chapter on “Small Step Service Design Thinking” – overview

By M2|2019-03-07T14:45:20+00:00March 6th, 2019|Uncategorized|

M2’s new book chapter on “Small Step Service Design Thinking” – overview

We are proud to announce the publication of Service Design and Service Thinking in Healthcare and Hospital Management by Springer.

M2 authors contributed a chapter titled, “Using Small Step Service Design Thinking to Create and Implement Services that Improve Patient Care,” focused on two case studies highlighting how small process changes can have a big impact on patient care.

Why did we write these cases?

In 2017, we wrote a book chapter of case studies titled, “Essential Characteristics of Service Business Model Innovation” in Service Business Model Innovation in Healthcare and Hospital Management and noted the importance of having guideposts as the system of delivering and paying for health care in the U.S. undergoes seismic changes. As we have continued to support a range of health care clients, and worked side-by-side with patients and patient groups these past two years, we became increasingly frustrated at the lack of understanding of how a patient experiences the system and we believe this is at the root of so many biases, barriers, and gaps.

We all know it: Health care rarely puts the patient first

Since service design is all about improving communications and relationships, it makes sense that an industry that is (ideally) focused on people should be embracing this type of thinking. But much of service design in health care is focused on what we call “big leaps,” such as redesigning patient rooms or waiting areas. This type of change at a hospital or integrated health system takes significant time, commitment, and funding, but does it really improve patient care?

Probably not.

David Feinberg, VP at Google Health, wrote in 2016 when he was the President and CEO of Geisinger Health Systems in Pittsburgh, that health care organizations should eliminate waiting rooms (not redesign them!). A waiting room, he says, means the organization is provider-centered. In other words, the most important person in health care is the provider, not the patient.

Is this a people problem, or a process problem?

Our concept of “small step” service design thinking is inspired in part by the ideas presented in the book, Switch: How to Change Things When Change Is Hard, by Chip Heath and Dan Heath. As they explain, one of the first surprises about change is “what looks like a people problem is often a situation problem”. Essentially, many of us make an attribution error in attributing another person’s behavior to “the way they are, rather than to the situation they’re in.”

It seems simple to say it, but talking with patients and understanding their situation can lead to innovation that creates change and improves access and outcomes.

Small step service design focuses on processes that may seem routine or mundane but are integral to improved patient service experience and patient health outcomes.

The two cases in the book chapter serve to highlight health care models where an entity used the design thinking process to put the patient first. We look at two examples of such small step changes: an innovative patient appointment process and a design change at a city fire department. In both cases, the organizations achieved improved patient care and can be used by other health care organizations to guide their service thinking.

We will be blogging about the case studies in the coming weeks, but in the meantime, please consider asking yourself and your team as you work on health care projects: 1) Would the process being suggested put the patient first? 2) Did you ask the patient?

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We Pay for What We Value. Guess What We Value in the U.S. Health Care System?

By M2|2019-02-04T17:27:13+00:00February 1st, 2019|Health care spending, Health Care Trends, Hospitals, Insurance, Providers, Uncategorized, What do we pay for and why|

We Pay for What We Value. Guess What We Value in the U.S. Health Care System?

People often ask what the difference is between the United States and other health care systems. Health Affairs recently published a helpful piece focused on comparing costs entitled “It’s Still The Prices, Stupid: Why The US Spends So Much On Health Care, And A Tribute To Uwe Reinhardt” by Gerard F. Anderson of Johns Hopkins Bloomberg School of Public Health, Peter Hussey, a VP at RAND Corporation in Boston, and Varduhi Petrosyan, a professor and dean in the Turpanjian School of Public Health, American University of Armenia, in Yerevan. The article is an update of a similar one they published back in 2003, along with Uwe E. Reinhardt, who was the James Madison Professor of Political Economy at the Woodrow Wilson School of Public and International Affairs, Princeton University, until his death in November 2017. The authors compare the health care costs, accessibility, spending growth rates, and other fees in OECD countries.

Notably, there is no concise chart in the article, showing the side-by-side of this information – so we made one! We also calculated a multiple, to see how much more (or less, but usually more) the U.S. spends compared to the median of the OECD countries.

In the chart below, we tried to focus on the main categories of health care costs – health insurance administrative costs, hospital care, physician salaries, nurse salaries and pharmaceutical spending. Interestingly, the information needed for a comparison across countries and categories was not always available in the Health Affairs article. This highlights a pretty big problem with health care data – researchers often say that it’s hard to compare inputs across countries because of their different systems and economies, so they just don’t. This means we don’t actually know for sure how these costs compare to each other.

You may notice the huge difference in per capita health insurance administrative costs. The fact that the U.S. spends almost 8 times as much as the median of OECD countries on health insurance administrative costs (and not actual health care) is rarely a focus of health system policy change, though it is well-known:

“The next-highest-spending country after the US (Switzerland) had administrative costs of only $280. In 2017 Steffie Woolhandler and David Himmelstein [Commonwealth Fund] estimated that the US would save about $617 billion (about 20% of its total health spending) if it moved to a single-payer system.”

We have written about standardizing a set of forms before. Maybe this is a good place to start addressing health care costs in the U.S.?

Another area of high cost in the U.S. compared to other countries is hospital and health care providers. According to the Health Affairs article, all of the inputs for hospital care – including “health care workers’ salaries, medical equipment, and pharmaceutical and other supplies – are much more expensive than in other countries.”

Why are health care provider costs higher in the U.S.? In part because the allocation of physicians in the U.S. is different from other OECD countries, and skews to more expensive care: the U.S. has the lowest percentage of general physicians relative to specialists of OECD countries.

Making changes seems as easy as the U.S. looking to a country that seems to have lower health care costs and “copying” what they do. But these researchers did this same analysis in 2003 based on 2000 data and now, nearly 20 years later, they found the relative rankings of the countries to be about the same for most indicators. Health care costs are different across countries because health care systems are different across countries. And of course, systems are different across countries because values are different.

Based on what the U.S. spends in different health care categories compared to other countries, we seem to really value health insurance administrative costs. Now we know.

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Here’s a health policy idea, let’s listen to patients

By M2|2019-01-24T15:19:50+00:00January 23rd, 2019|Health Care Trends, Innovation, Uncategorized, What do we pay for and why|

Here’s a health policy idea, let’s listen to patients

Earlier this month I was a presenter and leader of a panel session at the Washington State of Reform Health Policy Conference in Seattle titled, “A Policy Framework for New Medicine.” The other two panelists and I were asked to present our points-of-view about policy related to “personalized medicine, miracle drugs, and genome-specific therapies.” The other two panelists were gene therapy patients. Ashanthi DeSilva is the first person in the world to undergo an approved gene therapy, which she did at the age of 4 in 1990. Toby Willis was “the first adult to undergo the first gene therapy approved in the U.S. for treatment of an inherited disease,” in March 2018.

Gene therapy is a topic of particular interest to me, naturally because of the work that I do, but also because I wrote my thesis to complete an M.A. in Philosophy at Boston College on the ethical use of gene therapy, in 1994. Those were the early days of gene therapy as a practical treatment, and I encountered a great deal of resistance for my thesis proposal from the hallowed halls of the esteemed Jesuit institution. My advisors were just not convinced there was any real-world application for gene therapy, and therefore they didn’t see the value in developing a framework for navigating the ethical considerations that I was sure were on the cusp of driving innovative patient care. What an incredible experience for me, then, to meet the woman who had undergone the world’s first gene therapy trial as a young child in roughly the same time period that I was pushing for approval from the chair of the philosophy department to start a conversation on how to decide who should receive (and for what reasons) gene therapies.

Both Ms. DeSilva and Mr. Willis are remarkable people and they were able to shine a light on the policy problems that still exist decades after gene therapy was first used to treat a patient. For example, Ms. DeSilva must still argue with her insurance company to have her ancillary medications approved because they are subject to prior authorization requirements despite the fact that she needs them because of her primary diagnosis – and will likely need them for the rest of her life. Mr. Willis’s policy story focused on the core questions before the group: Should we pay for innovative treatment? For whom? Under what circumstances? And, of course, who should pay? Individuals? Employers? Insurers? Taxpayers?

These sessions can sometimes be dry presentations where speakers do their thing without any regard for the audience. What happened at this session was different. It was a free flowing discussion that used the panelists as touchpoints, but drew out the expertise and ideas of audience members – including a health plan, a specialist provider, a policymaker, and pharmaceutical manufacturer. Some policy concepts offered were easily agreed upon, for example, trying to spread risk across a broader pool of people or spreading the costs of treatments over time. But I was the most impressed with the policy ideas offered by the patients in the room who were recipients of life-changing treatment. The ideas were at once simple, and nearly impossible. To close the session I asked the other panelists to give one recommendation for people in the audience to do when they left the room.

Ms. De Silva recommended that when thinking about health care policy, we should all try to think of someone besides ourselves.

Mr. Willis, who claimed not to be a policy expert, deftly explained what seems to be the core of the problem with the U.S health care system today. He said, “the system treats health plans as the customer, but I think patients should be the customer.”

So, as we begin an already busy health care policy 2019, I will be trying to heed this great advice. Maybe policymakers will, too.

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What gets prescribed and why: Opioids v. obesity meds

By M2|2018-12-06T18:37:08+00:00December 6th, 2018|Chronic pain, Evidence-Based Medicine, Health Care Trends, Insurance, Uncategorized, What do we pay for and why|

What gets prescribed and why: Opioids v. obesity meds

The U.S. health care system doesn’t always make sense. Sometimes, even when there is some logic to it, the reasons underpinning what gets prescribed by practitioners and covered by insurers are disappointing. Two pieces I read recently provide examples.

In one study, we learn that while primary care physicians are prescribing opioids less often, other specialists and nurse practitioners are prescribing them more often. Ultimately, opioid prescribing remains at a high level, despite known issues with misuse and abuse, and the availability of alternative pain treatments.

At the same time, while 40% of U.S. adults are obese, fewer than 2% of obese patients are offered medications for obesity, and ultimately “only about 1% of eligible patients fill a prescription for a weight loss medication.” Even when weight loss medications are prescribed, it is usually for a specific (fairly short) period of time, explained Dr. Caroline M. Apovian, a Professor of Medicine and Pediatrics, Department of Medicine, Section of Endocrinology at Boston University School of Medicine and the Director of Nutrition and Weight Management, Department of Endocrinology, Diabetes, and Nutrition, at Boston Medical Center, in an opinion piece in Medscape.

This is an example of what we like to call at M2: “what do we pay for and why?” If 40% of the public has a disease, why aren’t treatments prescribed and covered? Several chronic obesity management medications have been approved by the U.S. Food and Drug Administration (FDA) in the past few years, and have proven of efficacy of 5%-10% weight loss, but Dr. Apovian argues that “public perception of obesity as a matter of will power rather than a disease” is a key barrier to lower treatment rates for obesity.

The U.S. health care system doesn’t necessarily pay for what works, or the treatments people need. As with all policy decisions, there is a judgment about who deserves what, and who should pay for it. In the case of treating obesity with a prescription, Dr. Apovian succinctly explains the current policy stance: “If obesity is considered a moral failing, why treat it with a pill or surgery?”

What’s the hold up? Why do physicians not turn more frequently to the known effective treatments for obesity? Well, sometimes it is lack of proper training (discussed in our in April). Physicians have a lot to stay up to date on, and obesity treatments are often not prioritized despite the prevalence of comorbidities. As we discussed in a back in February, improved insurance coverage for proven effective weight loss treatments could help avoid expensive complications from obesity down the road and may improve quality of life. We suggest this is a better way to choose what is covered the current approach.

Pain affects a large number of people in the U.S. as well – more than 100 million adults. Nearly 40 million adults experience the highest levels of pain (category 3 or category 4), and there are more than 25 million adults who report chronic (daily) pain. Further, the Centers for Disease Control and Prevention (CDC) Guideline for Prescribing Opioids for Chronic Pain is clear: “Opioids are not first-line or routine therapy for chronic pain.” Despite this clear recommendation, as the recent study confirms, opioids continue to be frequently prescribed for pain, even though there are less addictive alternatives available. These medications aren’t that expensive so are frequently covered by insurance.

The M2 blog, Coverage Drives Treatment: The Case of Pain explains how insurance companies seem to prefer to cover what is inexpensive, and perhaps less effective, at least when it comes to opioids for pain.

Confounding situations like this are when we understand why an overhaul of the health care system is appealing to some. It would be an incredible opportunity to step back and create a new system that approaches all situations – obesity, pain, everything – from the perspective of longer term effectiveness. Ultimately this would reduce health care system costs overall, as less time (and money) would be spent covering up symptoms of something that is likely to cause greater expense down the road.

But in order to do this, we’d have to face who we think deserves what kind of care. These decisions are baked in to the system we have and rarely discussed. 2019 is around the corner. Should we start this conversation in the new year?

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Happy Thanksgiving to all!

By M2|2018-11-26T14:49:18+00:00November 21st, 2018|Uncategorized|

Happy Thanksgiving to all!

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What the Midterms Mean for State Health Policy

By M2|2018-11-09T20:29:48+00:00November 8th, 2018|Health care spending, Health Plans, Health Reform, Insurance, Medicaid, Out-of-pocket spending, State Health Initiatives, Uncategorized|

What the Midterms Mean for State Health Policy

The midterm elections have happened and all signs point to health care as a top issue in state legislatures in 2019. We have been telling our readers (and clients) this for several months, and Drew Altman, President and CEO of the Henry J. Kaiser Family Foundation, wrote in a guest post for Axios today: “most of the real action affecting people will be in the states.”

Approximately 4 in 10 voters told exit pollsters health care was the top issue for their voting choices. This isn’t surprising as health care costs are going up by about 5% a year, and consumers are being asked to pay a higher share of those costs, which is clearly putting pressure on state policymakers to do something.

States are under particular pressure because they are responsible for overseeing the individual and small group health insurance markets and Medicaid. Why does this matter? Because an increasing proportion of people are working, but don’t have access to employer-sponsored insurance, and can’t afford health insurance being offered in their state.

That is, people have jobs, but the jobs don’t offer health insurance.

In The Rise and Nature of Alternative Work Arrangements in the United States, 1995-2015, researchers at the National Bureau of Economic Research (NBER), Lawrence Katz from Harvard University and Alan Krueger of Princeton University, estimate:

…all of the net employment growth in the U.S. economy from 2005 to 2015 appears to have occurred in alternative work arrangements.

The researchers found between 2005 and 2015 workers in alternative work arrangements, such as “temporary help agency workers, on-call workers, contract workers, and independent contractors or freelancers – rose from 10.1 percent in February 2005 to 15.8 percent in late 2015.”

For these “gig workers,” buying health insurance coverage, for example in the Obamacare exchanges, means high premiums (see ) and very high deductibles, as the chart below from Avalere shows.

Deductibles of $4,000, $5,000, $6,000 are rarely seen in large employer insurance offerings. Only 20% of covered workers in large firms in 2018 had an annual deductible of $2,000 or more. Compare that to 42% of workers with a deductible of $2,000 or more in small firms (fewer than 199 workers), as the Kaiser Family Foundation chart below shows.

For the parts of the health care market states oversee, including the individual and small group insurance markets, state employees, and Medicaid, states will have their hands full in 2019 as they try to manage health costs for constituents who are working but can’t afford the health insurance options available to them.

It’s hard to understand why it’s reasonable that a freelancer or person working in a small firm can’t have access to the same affordable, robust health coverage as their counterparts in large firms.

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It’s Open Enrollment for Health Insurance. Am I a Small Business?

By M2|2018-11-02T16:14:41+00:00November 1st, 2018|Health Plans, Health Reform, Insurance, Uncategorized|

It’s Open Enrollment for Health Insurance. Am I a Small Business?

Open enrollment started today for the approximately 15 million people – less than 5% of the U.S. population – who do not purchase their health insurance through an employer, or receive it via a government-run program, such as Medicaid, Medicare, or military health care. Likewise, for people enrolled in Medicare, or many employer plans, it is the season to be making a choice about what health insurance you’d like to have for you and your family next year.

As a small business owner, I am also faced with a decision about whether and how to offer insurance to my employees, and what to offer. Here is where the fun begins and where my work life as a state health policy consultant collides with my experience as an employer trying to do the right thing.

In Virginia, as of 2018, I can now choose between buying coverage in the individual market or the small group market. This is because the Virginia legislature passed SB672 this summer, revising the definition of “small employer.” Here is the super boring, but very important change as described by the Virginia Bureau of Insurance in a bulletin to health insurance carriers:

The new law broadens the definition of “small employer” in §§ 38.2-3406.1 and 38.2-3431 of the Code of Virginia (“Code”) to include a “self-employed individual, and to allow a sole shareholder of a corporation or a sole member of a limited liability company (“LLC”), or an immediate family member of such sole shareholder or sole member, to count as an employee of the corporation or LLC, provided that the individual has performed a service for remuneration under a contract of hire.

Why does this matter? Because the rates offered to me in the small group market are much lower than those offered to me in the individual market for the same coverage, in the same market, with the same selection of providers. The difference is stark as the table below shows.

Table 1. M2 Health Care Consulting Healthcare.Gov Individual v. Small Group Rate Comparison

Notably, the Virginia Bureau of Insurance admits in the summer bulletin, “the inclusion of sole proprietors in the definition of “small employer” does conflict with the definitions of “small employer” as administered by the Department of Health and Human Services, the Department of Labor, and the Internal Revenue Service, § 1321(d) of the Patient Protection and Affordable Care Act (“ACA”)…” [emphasis added]

But in its defense of possibly being in violation of federal law, Virginia argues first, that this provision “does not ‘prevent the application’ of the ACA,” and second, that other states have enacted similar laws.

Health care is confusing, expensive, and has become increasingly frustrating. Virginia decided to make a health care policy change this year that makes at least one small business less frustrated, while at the same time making health insurance options for me and my employees less expensive and we appreciate it. Let’s keep working on the system and see what else we can do!

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States Help Drive National Solution to Help Patients Pay Less for Drugs

By M2|2018-10-15T16:42:41+00:00October 12th, 2018|Health Care Trends, Out-of-pocket spending, State Health Initiatives, Uncategorized|

States Help Drive National Solution to Help Patients Pay Less for Drugs

This week, President Trump signed two bills to help consumers choose lower priced drugs, the Patient Right to Know Drug Prices Act and the Know the Lowest Price Act of 2018. As state health policy people, we are glad to see the work of the past several years gaining the attention of policymakers everywhere, and improving access to health care for patients.

Between 2015 and 2018, 28 states passed laws banning a practice that prevented pharmacists from telling patients whether a lower price drug was available to them at the pharmacy counter. (See map from National Conference of State Legislatures below).

The so-called “gag clauses” were a common feature of contracts between pharmacies and pharmacy benefit managers until pharmacists started to speak out – usually in violation of the contract – that they were being banned from telling patients when a drug might cost less if they didn’t use their insurance. It seems simple on its face that a pharmacist, or any health care provider, should be able to give information to patients related to what the patient will have to pay for treatment.

We are proud to have been a part of state leadership on this issue in our role as state health policy advisors, and we are pleased to see this common sense approach is now the law of the land.

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