Physician shortage predictions ‘overestimated’: researchers

Healthcare Business News
By Andis Robeznieks

Posted: January 8, 2013 – 12:00 pm ET

Tags: Electronic Health Records (EHR), Information Technology, Labor, Physicians, Research, Staffing

Those who forecast shortages of primary-care physicians may be shortsighted, a group of academic researchers says in a Health Affairs report likely to stir controversy on a much-debated issue.

The hand-wringing about primary-care shortages is unwarranted if those making the predictions are basing their estimates on doctor-to-general-population ratios that don’t align with the productivity of a modern physician practice, researchers from the Columbia Business School in New York and the University of Pennsylvania’s Wharton School in Philadelphia said.

They also argued that shortages could be averted with physician “pooling,” effective use of nurse practitioners and physician assistants and technology that reduces the need for face-to-face visits.

In their report, the researchers wrote that using ratios—such as one primary-care doctor for every 2,500 people—to project shortages assumes the traditional model of patients being seen by a single physician is still the order of the day, which leads to misdirected conclusions.

The researchers argued that a practice’s patient panel can be expanded by using “open” or same-day scheduling, which calls for giving patients the option of seeing another doctor if their regular physician is unavailable. This model calls for creating “pods” of two or three doctors supported by a nonphysician professional and the use of a common electronic health-record system.

“Furthermore, if we include the impact of diverting a fraction of patient appointments to nonphysician professionals or of addressing some of the demand through electronic communication channels, the predicted physician shortage essentially evaporates,” the authors wrote, citing a 2009 Kaiser Permanente study that found that primary-care visits decreased 25.3% after implementation of an EHR that encouraged electronic communication with patients—rather than in-person visits—pertaining to management of chronic conditions.

Projected shortages, they argued, are based on single-physician practices facing an increased number of patients demanding an increased volume of services. But through pooling and diversion, “this projected shortage can be completely eliminated,” they wrote.

Physician pooling and diverting patients to nurse practitioners and physician assistants could lead to a loss of continuity, the authors acknowledged. But the loss of continuity would be greater if patients chose instead to go to a hospital emergency room for primary-care services.

Given the current trends toward team-based care and EHR adoption, the authors concluded that “the widely perceived national primary-care physician shortage that has been forecast may, in fact, be greatly overestimated.”

Read more: Physician shortage predictions ‘overestimated’: researchers – Modern Physician

BREAKING: In 2011, U.S. healthcare spending growth stayed at slowest rate in 52 years

By Jessica Zigmond

Posted: January 7, 2013 – 12:01 am ET

Tags: Centers for Medicare & Medicaid Services (CMS), Costs, Finance, Medicare, Reimbursement

For a third year in a row, U.S. healthcare spending in 2011 grew at its lowest rate in the 52 years that federal officials have tracked the figure, according to annual statistics from CMS’ Office of the Actuary.

The year 2011 marked the third consecutive year that healthcare spending grew at a rate of 3.9%, while healthcare as a share of gross domestic product remained at 17.9% from 2009 through 2011. The statistics came from the National Health Expenditure Accounts, which have been published for 52 years. Analysts noted that the high unemployment, loss of private insurance and a decrease in the amount of resources pay for healthcare resulting from the economic recession between December 2007 and June 2009 led to historically low healthcare spending growth between 2009 and 2011.

Although overall healthcare spending remained unchanged, certain areas of healthcare experienced faster growth in 2011, such as Medicare spending, which grew at a rate of 6.2% from 4.3%, which the findings showed is a result of a one-time increase in spending for skilled-nursing facilities and also faster growth in spending for physician services in fee-for-service Medicare and for Medicare Advantage. Out-of-pocket spending also rose—to 2.8% in 2011 from 2.1% in 2010—which the report says is partly because of higher cost-sharing and increased enrollment in consumer-directed plans.

Evidence about how well consumer-directed plans are faring is mixed, said Rick Foster, who will retire this month from his position as CMS’ chief actuary.

“The costs are certainly lower but are they lower because the whole idea is working, or are they lower because healthier people tend to go for high-deductible coverage and less healthy people tend to stick with traditional coverage?” Foster said. “That remains to be seen.”

Meanwhile, certain segments witnessed slower growth. For instance, hospital spending reached $850.6 billion in 2011, increasing about 4.3%, or a 0.6 percentage point slower than the 4.9% growth in 2010. One primary factor is that hospital price growth increased 2.1% in 2011, which was down from the 3% level in each of the previous three years.

“In addition to that, we saw a decline in inpatient days and a slowdown in outpatient visits for 2011, reported by the American Hospital Association,” Micah Hartman, a statistician in the CMS Office of the Actuary, said during a news conference at the National Press Club. “And finally, the big piece being also that Medicaid spending slowed pretty dramatically in 2011.

Medicaid expenditures also grew at a slower pace, to 2.5% in 2011 from 5.9% in 2010. The reasons for this include continued pressure on state budgets in a recovering economy and also a shift in spending from the federal government to the states, which took place in June 2011 when enhanced federal aid to states expired.

The findings—published in the journal Health Affairs—also noted that the Patient Protection and Affordable Care Act had minimal effects on healthcare spending growth in both 2010 and 2011. One area that did have an impact was a provision that expanded private health insurance coverage to dependents under the age of 26.
Read more: BREAKING: In 2011, U.S. healthcare spending growth stayed at slowest rate in 52 years | Modern Healthcare

Q&A: Changes Under the Affordable Care Act

January 10, 2013 • By Michelle Andrews Special to The Washington Post


With just a year to go before the most significant changes under the Affordable Care Act take effect, readers have many questions about how the law will affect them.


Q. My employer, with over 3,000 employees, is holding meetings with us explaining the health-care law and how expensive it is going to be for us and for them. My employer is saying it will likely drop our insurance and make us buy our own. Will the insurance premiums still be a pre-tax payment? Are there affordable options for me and my family?

A. If your employer drops your health insurance coverage and you have to buy your own plan, you would no longer be able to pay your premium with pre-tax dollars.

Starting in 2014, if your employer stops offering coverage, you can look for a plan on the health insurance exchanges that will be functioning in every state. Even though you wouldn’t get the tax break you currently receive, subsidies will be available to people with incomes up to 400 percent of the federal poverty level ($92,200 for a family of four in 2012) to help cover costs.

Q. What does the new health-care law mean for people like me, who use alternative medicine?

A. The law spells out 10 categories of “essential health benefits” that most individual and small-group plans must cover starting in 2014, whether they are sold on a state-based health insurance exchange or on the private market. They include hospitalization, emergency care, maternity and newborn care and prescription drugs.

Each state will pick an existing plan whose benefits include at least those 10 categories to serve as a benchmark for coverage. In general, other individual and small-group plans will have to include the benefits covered by the benchmark plan. If, for example, a benchmark plan covers acupuncture or chiropractic treatments, such services may be covered by other individual and small group plans in the state.

But some policy experts say the latest federal guidance doesn’t make it clear that a benchmark plan’s benefits that don’t easily fit into one of the 10 essential health benefit categories of care, such as acupuncture, must be covered by all plans.

Moreover, insurers are permitted in some instances to substitute benefits, as long as they are determined to be substantially the same in value under the law. So in theory, an insurer might decide to swap out acupuncture in favor of something else, such as physical therapy, says Karen Pollitz, a senior fellow at the Kaiser Family Foundation. (Kaiser Health News is an editorially independent program of the foundation.)

These essential health benefit rules don’t apply to plans offered by large companies, plans that pay employee claims directly and those that are grandfathered under the law.

Q. My 21-year-old is on our health plan but has moved out of state. We were recently told by our health plan that he will not be eligible for coverage if he lives out of the area. I thought children could remain on their parents’ health plan up to the age of 26.

A. You’re right. Under the Affordable Care Act, your son can stay on your health plan until he turns 26 even if he lives out of state. As a practical matter, though, you may find that if he needs care outside your plan’s service area, he may have to see an out-of-network provider, and that can get expensive.

Some young people solve the problem by waiting to see the doctor until they come home to visit Mom and Dad. But for adult children with a chronic medical condition, that may not be possible.

Your son will have access to “whatever the plan is required to cover in terms of emergency care or out-of-network care,” says Jen Mishory, deputy director of Young Invincibles, an advocacy organization for young adults, but “the insurer doesn’t have to have a national network of providers.”

This column is produced through a collaboration between The Post and Kaiser Health News. KHN, an editorially independent news service, is a program of the Kaiser Family Foundation, a nonpartisan health-care-policy organization that is not affiliated with Kaiser Permanente.



Consumer-driven health plan participants more likely to use mHealth apps


January 8, 2013 | By Greg Slabodkin

Adults enrolled in a consumer-driven health plan are more likely to use a smartphone or tablet for health-related purposes than members enrolled in a traditional health plan, according to the findings of a recent survey from the Employee Benefit Research Institute.

Based on an online survey of 4,498 privately insured adults conducted in December, it was found that about three-fifths of the adult population with private health insurance had used a smartphone within the past year, and about 40 percent had used a tablet. Among those with a smartphone or tablet, 27 to 32 percent used a smartphone app for nutrition information; 25 to 29 percent used one for general health information; 23 to 27 percent used one for weight management or diets and 23 to 26 percent used one for exercise programs.

FierceMobileHealthcare reported in December that one-fourth of Americans trust mHealth apps as much as they trust their doctors.

There were no significant differences in the use of smartphone or tablets for health-related purposes by plan type, with the exception of medical claims history, where it was found that 11 percent of CDHP enrollees used such an app, compared with 6 percent among traditional-plan enrollees.

Among those not using an app, about one-half indicated that they were either very or somewhat interested in using one for things like nutrition information, exercise programs, weight management or diets, prescription drug prices, medical claims history and general health information.

In a related and recent report, EBRI found that enrollees in CDHPs are increasingly satisfied with their benefits.

To learn more:
– read the findings of the EBRI survey

Related Articles:
AHIP: High-deductible health insurance plans grow 18%
Consumer-directed plans offer short-term benefits
Health spending, preventive care drop with high-deductible plans

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20 states now have approval to run insurance exchanges

Publish date: Jan 5, 2013

By:  Rachael Zimlich


Medical Economics


Arkansas, California, Hawaii, Idaho, Nevada, New Mexico, Vermont, and Utah are the latest states to earn conditional approval to operate state-based health insurance exchanges, according to an announcement from the U.S. Department of Health and Human Services (HHS).

The new additions bring the grand total of states ready to operate their own exchanges to 20, including Washington, D.C. Other states already granted approval include Colorado, Connecticut, Kentucky, Massachusetts, Maryland, Minnesota, Mississippi, New York, Oregon, Rhode Island, and Washington.

“States across the country are working to implement the healthcare law and build a marketplace that works for their residents,” says HHS Secretary Kathleen Sebelius. “In 10 months, consumers in all 50 states will have access to a new marketplace where they will be able to easily purchase affordable, high-quality health insurance plans, and today’s guidance will provide the information states need to guide their continued work.”

Another 24 states—Alabama, Alaska, Arizona, Florida, Georgia, Indiana, Kansas, Maine, Missouri, Montana, Nebraska, New Jersey, New Hampshire, North Dakota, Ohio, Oklahoma, Pennsylvania, South Carolina, South Dakota, Tennessee, Texas, Virginia, Wisconsin, and Wyoming—have declined to operate their own exchanges, defaulting to a federal exchange instead, according to data collected by the Henry J. Kaiser Family Foundation.

The six remaining states—Delaware, Iowa, Illinois, Michigan, North Carolina, and West Virginia—are still in the planning stages for their exchanges, according to Kaiser. They have until February 15 to apply for State Partnership Exchange Approval, HHS says.

Consumers will be able to access the exchanges, mandated by the Affordable Care Act, beginning in 2014. The program will allow the public to buy insurance from qualified health plans directly through these marketplaces and may be eligible for tax credits to help pay for their health insurance.


Boomers to benefit best from Affordable Care Act

8:08 PM, Jan 2, 2013  

Written by

Christine Dugas

USA Today

With the presidential election and Supreme Court decision behind us, the federal government is moving forward with the Affordable Care Act. Baby Boomers stand to gain the most.

Since the recession, Boomers have been hard hit by unemployment, shrinking nest eggs and rising health care costs. During those years, about 8.6 million Boomers were without health insurance, says a special 2009 report by Commonwealth Fund.

As the Boomer generation approaches retirement, many hope that the health care law will fill the void. “It is a game changer,” says Ron Fontanetta, a health care group practice leader at Towers Watson. “It will provide health care access to pre-65 retirees in a very significant way.”

Retirees who have not reached age 65 are more at risk — they don’t qualify for Medicaid, and if their former employers don’t offer retiree health benefits, they will not have a group discount.

Also, it doesn’t take much for a health insurance company to say that they have a pre-existing condition and deny them coverage, says Paul Fronstin, head of health benefits research at EBRI. Even if Boomer retirees can get a private health insurance plan, it will be very costly.

Based on their age alone, Boomers have to pay prices that are five to seven times higher than younger Americans, according to AARP. But if early retirees can wait until the ACA takes effect, it will change the playing field, Fronstin says.

• Beginning in 2014, the law is supposed to prevent insurers from denying coverage to anyone who has a pre-existing condition. On Nov. 20, the Obama administration said that it was moving forward to implement provisions to ban discrimination and protect consumers from possible insurance abuses.

• The ACA also will do away with lifetime and annual dollar limits on benefits, and it will limit the age rating so that a Boomer can only pay three times as much as younger person.

• Health insurance will not necessarily be less costly. It will be operated by state health insurance exchanges, which will offer a competitive private health insurance market that should provide one-stop shopping.


Using Shared Savings to Foster Coordinated Care for Dual Eligibles

Richard G. Frank, Ph.D.

January 2, 2013 DOI: 10.1056/NEJMp1214155

There are 9.2 million people who are eligible for both Medicare and Medicaid. They’re eligible for both programs either because they are younger than 65 years of age, disabled, and poor or because they are 65 or older and are poor or have exhausted their nonhousing assets paying for health care. These dually eligible program participants make up about 20% of Medicare beneficiaries and about 17% of Medicaid beneficiaries and account for 29% and 39% of Medicare and Medicaid spending, respectively.1 New federal policy initiatives are promoting organizations that integrate and coordinate care to meet the complex needs of this vulnerable population. The hope is that if beneficiaries are encouraged to enter into such arrangements, costs will fall and quality of care will improve.

From a clinical perspective, dually eligible beneficiaries are more likely than others to have multiple chronic conditions or a severe mental disorder or to have functional limitations and cognitive impairments. Organizing care and support for this population is complicated because they frequently rely on income support, social supports, housing assistance, and long-term care that are administered and paid for by different state and local government agencies.

Financing health care for dually eligible people is also challenging because they require support from the state-run Medicaid program and the federal Medicare program. These two programs have provisions, payment rules, and regulations that often align poorly with one another, which results in high-cost, low-quality care. For example, a nursing home that cares for a long-stay Medicaid patient is economically advantaged when it transfers one of its residents to an acute care hospital for treatment of, say, a urinary tract infection. When this happens, the nursing home avoids devoting resources to treatment of the infection, it receives a payment from Medicaid to hold the bed for the hospitalized resident, and it gets paid a higher per diem rate by Medicare than it would from Medicaid for a period after the patient returns because he or she qualifies for Medicare-financed post-acute care.

The fragmentation in organization and financing of care for dually eligible people is seen by federal and state policymakers as a problem that can be remedied. Many policymakers believe that greater coordination of care for the dually eligible population that uses a strong care-management system under a unified budget can lead to both savings and improved care. To address this issue, the Affordable Care Act established the Federal Coordinated Health Care Office within the Centers for Medicare and Medicaid Services. The Bowles–Simpson Commission projected that between 2015 and 2020, we could save $13 billion by moving dually eligible people into managed-care plans. Others have proposed enrolling dual eligibles in state-designed care coordination entities (CCEs). Such a move was projected to save $126 billion over 10 years, according to the most optimistic estimate.2 Twenty-six states are pursuing demonstration projects aimed at better coordinating care for dual eligibles.

Because state Medicaid programs pay for most or all of a dually eligible beneficiary’s premiums and cost-sharing obligations, it has been very difficult to lure these beneficiaries away from uncoordinated, fee-for-service arrangements to more structured arrangements of care. To foster the transition, nearly all states are putting in place so-called passive-enrollment methods to expand participation in coordinated-care arrangements.

Passive enrollment involves automatic enrollment of eligible beneficiaries into a CCE with the ability to opt out. The assignment method generally uses information on a beneficiary’s needs to match him or her to a CCE’s capabilities. Passive-enrollment techniques have gained considerable credence because they have been successful in increasing participation rates in employer-sponsored 401(k) retirement plans. In those cases, natural tendencies toward inertia are exploited to get people to save for retirement. In this case, the beneficial effects of passive enrollment are clear: people get financial contributions from their employers toward their retirement. Failure to join a 401(k) plan leaves money on the table and the nonparticipant worse off.

The use of passive enrollment into CCEs would most likely produce higher rates of enrollment, enabling states to establish CCEs for a critical mass of enrollees. For beneficiaries who are dually eligible, however, the benefits may be less apparent. Many of these people may have established a set of relationships with providers so that their care is effectively managed within the fee-for-service system. Since coordinated care under a set global payment (e.g., capitation) or variants of that approach can create incentives to restrict services, there are risks of undertreatment. Some beneficiaries may therefore experience the transition to coordinated care as a loss to them.

How can state policymakers promote self-determination for vulnerable populations and offer them a reason to engage with a new care delivery system with coordinated-care arrangements? Coordinated care for dually eligible people is built on a financing structure known as shared savings, in which three of the parties involved — the federal and state governments and the CCE — share any financial gains from coordinating care. Including patients in shared savings could create a positive reason to engage with a CCE. How might such an approach work? A share of the expected savings could be set aside into an “account” for each dually eligible person enrolled in a CCE. The funds in the account could be directed by the patient and could be used to purchase supplemental services and supports such as transportation, home modifications, and personal assistance with activities of daily living. Similar types of accounts have been successfully used for some disabled Medicaid beneficiaries.3

These accounts are designed to have two aims. First, offering extra benefits creates an incentive for participants to engage with the CCEs in a way that promotes self-determination. Second, the additional funds can be used to compensate for gaps in services offered by CCEs in a way that helps in meeting individual needs (cushioning the risk the participant incurs by joining a CCE). Medicaid’s cash and counseling program, like other self-directed consumer programs, creates “cash-equivalent accounts” for purchasing services and supports. These accounts are overseen by a financial intermediary and provide counseling and help in decision making to support both independence and program integrity. This approach would enable beneficiaries to extend the benefits of Medicare and Medicaid in a personally tailored fashion without increasing their total costs.

One could also couple options for shared savings with an active choice mechanism whereby beneficiaries are forced to choose among options rather than defaulting into either a CCE or the status quo. Experimental research shows that this approach might also result in greater enrollment in CCEs than an opt-in system would.4,5 It would mean presenting beneficiaries with an explicit choice, without a no-action default, in which the CCE option would entail sharing in savings. It is important to advance program designs that have the potential to improve care and save money, but we need to do so in a way that promotes self-determination and the exercise of real options.

Disclosure forms provided by the author are available with the full text of this article at

This article was published on January 2, 2013, at


From the Department of Health Care Policy, Harvard Medical School, Boston.


IRS Proposes Employer Mandate Rules for Health Coverage

Accounting Today




The Internal Revenue Service has issued proposed regulations on the shared responsibility for large employers to provide health care coverage under the Affordable Care Act.

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The IRS noted that employers may rely on the proposed regulations for guidance until final regulations are issued. In addition, the IRS posted a questions and answers document on its Web site Friday to explain the Employer Shared Responsibility provisions under the Affordable Care Act and the new proposed regulations.

Under the provisions, if employers do not offer affordable health coverage that provides a minimum level of health insurance coverage to their full-time employees, they may be subject to an Employer Shared Responsibility payment if at least one of their full-time employees receives a premium tax credit for purchasing individual coverage on one of the new Affordable Insurance Exchanges.

Businesses that do not provide health insurance coverage may be subject to a penalty of $2,000 per employee per year if over 30 employees are subsidized by the tax credits. Employers need to provide “affordable” coverage that does not cost a single employee over 9.5 percent of their income, although the amount may be more for family coverage.

In order to be subject to the provisions, an employer must have at least 50 full-time employees, or a combination of full-time and part-time employees that is equivalent to at least 50 full-time employees (for example, 100 half-time employees equals 50 full-time employees). A full-time employee is considered to be an individual employed on average at least 30 hours per week. Half-time would be 15 hours per week.

The Employer Shared Responsibility provisions generally go into effect on Jan. 1, 2014, but employers will need to use information about workers they employ during 2013 to determine whether they have enough employees to be subject to the new provisions in 2014. 

In 2014, if an employer meets the 50 full-time employee threshold, the employer generally will be liable for an Employer Shared Responsibility payment only if: (a) The employer does not offer health coverage or offers coverage to less than 95 percent of its full-time employees, and at least one of the full-time employees receives a premium tax credit to help pay for coverage on an insurance exchange; or (b) the employer offers health coverage to at least 95 percent of its full-time employees, but at least one full-time employee receives a premium tax credit to help pay for coverage on an insurance exchange, which may occur because the employer did not offer coverage to that employee or because the coverage the employer offered that employee was either unaffordable to the employee or did not provide minimum value.

After 2014, the rule in part (a) applies to employers that do not offer health coverage or that offer coverage to less than 95 percent of their full time employees and the dependents of those employees.

A public hearing will be held on the proposed regulations on April 23 and is accepting written or electronic comments until March 18.