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As health care costs continue to consume an increasingly large share of the federal budget and impact Americans’ personal finances, it is important to understand the various drivers of those costs. The literature documents how higher levels of concentration (lack of competition) among commercial payers and providers contributes to higher premiums for commercial health plans. Less well understood, however, is the relationship between the concentration of Medicare Advantage (MA) plans in a market and MA premiums. Our paper uses a fixed-effects, multivariate regression to evaluate the association of both MA plan concentration and health system concentration on MA premiums. We found that increased concentration (lower competition) in the MA insurance market was associated with higher MA premiums and that if all beneficiaries were in markets at least as competitive as the average market today, they would pay nearly $200 million less in annual premiums. We also found that the highest premiums were in markets that lacked competition among MA payers and hospital markets, suggesting the interaction between MA insurer concentration and hospital system concentration matters. Our findings suggest that maintaining or increasing current levels of competition is necessary for controlling MA premiums.
In 2014, Affordable Care Act (ACA) federal requirements went into effect that dramatically changed the regulatory framework for the individual market in most states. The ACA also applied separate regulatory changes to the group market, with the small group market having to undergo more adjustments than large group, but in general these reforms had less of a disruptive impact than in the individual market. This paper compares average claims expense across the individual and group markets by analyzing total incurred medical claims, both before and after the ACA’s requirements went into effect, from 2010 to 2016. Because we examined the years 2010 to 2016, this paper does not take into account recent changes that may affect costs and premiums in 2018 and beyond. We find that at the national level, individual market costs are coming into increasing alignment and achieving parity with costs in the group markets. Our findings suggest the ACA’s 2014 regulations brought the individual market into greater cost parity with the more mature group market. If costs in the individual market rise beyond the point of parity with the group market, then the increases may be more indicative of the structure and makeup of the market than with just underlying health care costs.
By 2030, it is estimated that the United States will lack between 40,800 and 104,900 physicians. Moreover, there is a maldistribution of physicians across and within states. To address these projected shortages, some states, depending on their current environment, could bolster their supply of physicians by increasing their existing medical school enrollment or building new medical schools. We used data from the Medicare Physician Compare database to examine state retention of their medical school graduates and how a variety of factors, such as physician age, specialty, and gender, were related to a physician’s likeliness of practicing in their medical school state. We also analyzed the relationship between state retention of physicians and number of physicians per capita. We found that on average, states retain 38 percent of their medical school graduates and physicians who pursue a non-primary care specialty are more likely to leave their medical school state. We also observed a significant negative correlation between state retention and number of physicians per capita. Additional medical schools may not sufficiently address some state’s physician shortage unless other measures are also pursued, such as increasing residency positions. As states assess their physician supply and medical school graduate retention, there is also an opportunity for states to incorporate more value-based care training into the curriculum of both their existing and new medical schools. States may also consider encouraging the use of physician and non-physician care teams as an additional strategy to addressing their primary care physician shortage.
The Centers for Medicare and Medicaid Services (CMS) has shown significant support for the development of Alternative Payment Models (APMs). CMS’ development and testing of 45 payment models has led to the adoption of similar models by other payers. Initial reports indicate that APMs could be key to producing the health care delivery reform necessary to decrease health care costs and increase delivery quality. However, these models are only available to select provider types, and some providers, such as emergency physicians and audiologists, have no Medicare APMs in which they can participate. To realize the full benefits of APMs, additional collaboration between CMS leadership and providers is needed to develop new models for providers who do not currently have access to them.
The Comprehensive Care for Joint Replacement (CJR) bundled payment model is a Centers for Medicare and Medicaid Services (CMS) initiative that is designed to incent hospitals to reduce the widespread cost variation in hip and knee replacements, and post-operative hospital readmissions throughout the United States. Originally announced in 2015 and revised in 2017, hospitals in
34 markets will be required to participate in the model, including being subject to downside risk, beginning January 1, 2018.
The Affordable Care Act (ACA) established health insurance marketplaces for two purposes: to allow individuals to purchase insurance and gain subsidies for that insurance, and to increase competition and product comparability among insurers. Many Americans are using the federal and state-based exchanges to purchase coverage. In 2017, 12.2 million people selected policies through the marketplaces. With so many Americans buying health care […]
In an effort to increase care coordination and decrease health care costs across the care continuum, many health systems and hospitals are reconfiguring their relationship with post-acute care (PAC) providers. The momentum for change is driven in part from government-initiated efforts that hold hospitals and health systems responsible for the cost and quality of care delivered beyond the four walls of […]
Post-acute care (PAC) covers a range of health care services after hospitalization, including Long-Term Acute-Care (LTAC) hospitals, Inpatient Rehabilitation Facilities (IRFs), Skilled Nursing Facilities (SNFs), and Home Health (HH) agencies. Historically, health systems had little reason to closely integrate with PAC providers or even examine PAC providers on measures of cost and quality, largely because […]
In April 2015, Congress enacted a law that alters the method by which physicians and other health care providers are paid for Medicare Part B services. The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) replaced the sustainable growth rate formula with physician payments tied to quality. Providers must choose either significant performance-based payments […]
Nearly 1.7 million new cancer diagnoses in the United States are projected for 2017. Controlling the cost of treating cancer is an important consideration for curbing the overall cost of health care. We conducted a systematic review of the literature on the cost of treating cancer in the two most common cancer treatment locations, the […]