US Managed Care: teaching Limeys how to suck eggs

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US Managed Care teaching Limeys how to suck eggs

• By
• Alan Maynard

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Outline

• What is managed care?
• Why copy US failures?
• Overview lets do it our way!

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Managed care
a system that, in varying degrees,
integrates the financing and delivery of medical
care through contracts with selected physicians
and hospitals that provide comprehensive health
care services to enrolled members for a
predetermined monthly premium. All forms of
managed care represent attempts to control costs
by modifying the behaviour of doctors, although
they do so in different ways.
Iglehart 1994
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Organisational forms of health delivery in the USA
Organisational form Definition Indemnity plan
with Complete freedom of choice to fee for
service patients. Insurer reimburses physici
ans on a FFS basis Managed indemnity Free
choice and FFS but insurer plan exercises some
degree of utilis- ation control to manage
costs
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Organisational forms of health delivery
(continued)
Organisational form Definition Preferred
provider Insurer channels patients to
preferred organisation physicians who are
usually paid discounted FFS. The insurer,
not the physician, usually accepts financial
risk for performance Independent practice
Insurer channels patients to physicians associati
on usually solo or in small groups who have
agreed to some financial risk for performance.
Payment may be either capitation or FFS
with financial incentives based on
performance
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Organisational forms of health delivery
(continued)
Organisational form Definition Network
independent Similar to IPA but consists of a
network practice organisation of larger group
practices. Payment is usually capitation to
each group, which then pays the
physicians Staff/group model The classic,
prepaid, large multispecialty health
maintenance group practice. Patients are
covered only organisation for care delivered by
the HMO. Physicians are usually salaried and
work for the plan (staff model) or a group
practice that has an exclusive contract with
the plan
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Managed care in the UK

• Contracts that specify activity and case mix
  (I.e. how much and what?), measures of failure
  (e.g record cards and weekends), and measures of
  success health related quality of life measures
  (e.g. www.sf36.org and www.euroqol.org )
• Management of doctors I.e. controlling the their
  behaviour. Agreeing with them and policingwhat
  they produce?, how much?, how (which evidence
  based technology?) and to whom (peasants or
  bourgeoisie?)

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US managed care failed so why copy it?

• Common problems
• Medical practice variations
• Failure to deliver appropriate care Rand
  Corporation study The First National report Card
  on Quality of Health Care in America in May,
  2004 overall , adults received about half of
  recommended care
• medical errors.medication errors kill twice as
  many Americans each year as 9/11
• the failure to measure outcomes

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Practice variations survive unmanaged over decades

• US Medicare per capita spending in 2000 was
  10,550 per enrolee in Manhattan and 4823 in
  Portland, Oregon. Differences are due to volume
  effects rather than illness differences,
  socio-economic status or price of services.
• Residents in high spending regions received 60
  more care but did not have lower mortality rates,
  better functional status or higher satisfaction
  Fisher et al (2003). Potential savings of 30 if
  high spenders reduce expenditure and provide the
  safe practices of conservative treatment regions?
  Fisher in NEJM, October, 2003

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Why do variations survive?

• the amount and cost of hospital treatment in a
  community have more to do with the number of
  physicians there, their medical specialties and
  the procedures they prefer than the health of
  residents Wennberg and Gittelsohn(1973 in the
  journal Science)
• Does supply creates its own demand? Time to
  micro manage clinical activity to produce what
  local populations need rather than what amuses
  doctors to provide! Managed care failed to do
  this, like the NHS!

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Measuring outcomes 1

• If a surgeon has made a deep incision in the
  body of a man with a lancet of bronze and saves
  the mans life, or has opened an abscess in the
  eye of a man and has saved his eye, he shall take
  10 shekels of silver. If the surgeon has made a
  deep incision in the body of a man with his
  lancet of bronze and so destroys the mans eye,
  they shall cut off his forehand Laws of
  Hammurabi, Babylon, BC 1792

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Measuring outcomes 2

• Florence Nightingale is the patient
• Dead?
• Relived?
• Unrelieved?
• Why do we not measure success in health care? The
  use of health related quality of life measures
  www.sf36.org and www.euroqol.org e.g the case of
  BUPA

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Overview

• Why are we interested in US solutions. We have
  failed to manage doctors to remedy the four
  problems of variations , appropriate care, errors
  and outcome measurement, just like the Americans
• Adopting their failures, with its nice marketing
  techniques,may fail whilst some NHS reforms may
  assist change e.g. a well managed GP contract

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Managing contracts

• Why are PCTs such feeble purchasers?
• Do you need the purchaser-provider divide to be
  an efficient contractor US managed care
  integrated finance and provision.
• No contact is ever complete, and all will be
  subject to gaming. The respective roles of trust
  and money. Confucius said without trust we
  cannot stand

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Managing doctors

• Either they must transparently manage themselves
  with good information systems, or they will have
  to be managed externally. The need for validated
  activity, mortality and success (HRQoL) data.
• Why is there no such management? As the US
  sociologist Paul Starr remarked 20 years ago
  the dream of reason did not take power into
  account!

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Caution.

• Will diversity on the supply side, improve or
  undermine the NHS?
• Private providers once involved in the NHS have a
  vested interest in legislation and its favouring
  them e.g is the model the decline and fall of NHS
  dental care?
• No health care system has been able to regulate
  the private insurers or providers in health care
  to ensure they serve both efficiency and equity
  goals

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Summary

• Health care reform is social experimentation, and
  may damage patients just as much as bad drugs and
  poor patient care
• Government continually redisorganises the NHS
  with untested and usually unevaluated policies
  e.g patient choice, national tariffs, Foundation
  Trusts and untested US policies
• Be sceptical and demand evidence , not religious
  incantations!

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Conclusionclever people mess up more!

• Petr Skrabanek and James McCormick wrote
• the more intelligent the authorities, the more
  idiotic will be some of their claims. This
  paradox was explained by Francis Bacon (the
  philosopher, not the painter) who said when such
  a man sets out in the wrong direction, his
  superior skill and swiftness will lead him
  proportionately further astray
• (Facts and Fallacies in Medicine, Tarragon Press,
  Glasgow, 1992)