A careful look at variations in Medicare spending growth and patterns across the country might hold one key to reining in the rapid growth of health care costs, according to an analysis by Dartmouth University researchers.

They looked at Miami, Dallas, and other cities that are experiencing much faster growth in costs than some cities. San Francisco and Pittsburgh, for example, seem to have attained sustainable growth rates and are able to build on successful models of delivery-system and payment reform.

The researchers ruled out two explanations: technology (residents of all U.S. regions have access to the same technology and it is doubtful that physicians in slow-growth regions are denying their patients needed care) and the current payment system.

They surmised that the causes lie in how physicians respond to the availability of technology, capital, and other resources in the context of the fee-for-service payment system.

Physicians in high- and low-spending regions were about equally likely to recommend specific clinical interventions when supporting evidence was strong. Those in the highestspending regions, however, were much more likely to recommend discretionary services, such as referral to a subspecialist for typical gastroesophageal reflux or stable angina.

Current payment methods encourage spending by expanding the services that doctors and hospitals provide.

Any attempt to control costs, according to Elliott S. Fisher, MD, professor of medicine and of community and family medicine at the Center for Health Policy Research at the Dartmouth Institute for Health Policy and Clinical Practice and one of the authors, needs to address how doctors and hospitals are paid.

The researchers propose that there is a need for policies that encourage high-growth (or high-cost) regions to behave more like low-growth, low-cost regions. To accomplish this, they propose fostering the growth of more organized systems of care and implementing fundamental payment reform.

Insurers could promote greater collaboration and offer incentives — such as larger payment updates or subsidies for implementing electronic health records — to providers willing to establish care systems. The current volume-based payment system could then be adapted to incorporate partial capitation, bundled payments, or shared savings.

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There’s a lot more going on in health care than mergers (Aetna-Humana, Anthem-Cigna) creating huge players. Hundreds of insurers operate in 50 different states. Self-insured employers, ACA public exchanges, Medicare Advantage, and Medicaid managed care plans crowd an increasingly complex market.

Major health care players are determined to make health information exchanges (HIEs) work. The push toward value-based payment alone almost guarantees that HIEs will be tweaked, poked, prodded, and overhauled until they deliver on their promise. The goal: straight talk from and among tech systems.

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The surge of new MS treatments have been for the relapsing-remitting form of the disease. There’s hope for sufferers of a different form of MS. By homing in on CD20-positive B cells, ocrelizumab is able to knock them out and other aberrant B cells circulating in the bloodstream.

A flood of tests have insurers ramping up prior authorization and utilization review. Information overload is a problem. As doctors struggle to keep up, health plans need to get ahead of the development of the technology in order to successfully manage genetic testing appropriately.

Having the data is one thing. Knowing how to use it is another. Applying its computational power to the data, a company called RowdMap puts providers into high-, medium-, and low-value buckets compared with peers in their markets, using specific benchmarks to show why outliers differ from the norm.
Competition among manufacturers, industry consolidation, and capitalization on me-too drugs are cranking up generic and branded drug prices. This increase has compelled PBMs, health plan sponsors, and retail pharmacies to find novel ways to turn a profit, often at the expense of the consumer.
The development of recombinant DNA and other technologies has added a new dimension to care. These medications have revolutionized the treatment of rheumatoid arthritis and many of the other 80 or so autoimmune diseases. But they can be budget busters and have a tricky side effect profile.

Shelley Slade
Vogel, Slade & Goldstein

Hub programs have emerged as a profitable new line of business in the sales and distribution side of the pharmaceutical industry that has got more than its fair share of wheeling and dealing. But they spell trouble if they spark collusion, threaten patients, or waste federal dollars.

More companies are self-insuring—and it’s not just large employers that are striking out on their own. The percentage of employers who fully self-insure increased by 44% in 1999 to 63% in 2015. Self-insurance may give employers more control over benefit packages, and stop-loss protects them against uncapped liability.