Lab Soft News

Ohio Medicaid Department Directed to Quit Its PBM Contracts

It seems like this has been a long time coming but at least one set of state officials is taking action regarding the excess profits and business model of their pharmacy benefit managers (PBMs) (see: Ohio Medicaid to try out transparent PBM pricing model). Below are some details from the article:

Ohio's Medicaid department is directing its managed-care organizations to quit their contracts with pharmacy benefit managers because of opaque pricing practices officials said cost the state millions of dollars. The state's five managed-care plans must strike up new contracts with companies able to manage pharmacy services using a more transparent pricing model by Jan. 1, 2019. The decision comes after an analysis commissioned by the Medicaid department found that the two largest PBMs operating in the state — CVS Caremark and OptumRx — billed managed-care plans $223.7 million more for prescription drugs than they paid pharmacy providers in one year under a practice known as "spread pricing." Pharmacy benefit managers are middlemen that administer pharmacy benefits and negotiate prescription drug rebates from manufacturers on behalf of insurers and self-insured employers. They also negotiate discounts from pharmacy networks that dispense drugs to patients. Most PBMs engage in spread pricing, where the PBM pockets the difference between what it bills to the payer for medications and what it pays the pharmacy to dispense those drugs. PBMs keep that figure close to the vest. But the report commissioned by the Ohio Medicaid department found that the spread totaled 8.8% between the two PBMs in the state. Ohio Medicaid wants to move to a pass-through pricing model, in which the managed-care plan pays the actual discounted pharmacy price that the PBM negotiated with the retail pharmacy network. Under that model, PBMs wouldn't be able to keep the difference as revenue. Managed-care plans would be required to pay higher administrative fees to the PBM, however. 

All of this is a continuation of the controversy that has long been simmering about the excessive PBM profits. Here's another quote that adds to the discussion (see: The Hidden Monopolies That Raise Drug Prices):

Americans pay the highest health-care prices in the world, including the highest for drugs, medical devices, and other health-care services and products. Our fragmented system produces many opportunities for excessive charges. But one lesser-known reason for those high prices is the stranglehold that a few giant intermediaries have secured over distribution. The antitrust laws are supposed to provide protection against just this kind of concentrated economic power. But in one area after another in today’s economy, federal antitrust authorities and the courts have failed to intervene. In this case, PBMs are sucking money out of the health-care system—and our wallets—with hardly any public awareness of what they are doing.

One more aspect of this story relates to the discounts offered by pharmaceutical companies on some drugs. In 2011, Caremark Rx, now owned by CVS, was the nation's second-largest PBM. It was the subject of a class action lawsuit in Tennessee which alleged that Caremark kept discounts from drug manufacturers instead of sharing them with its member benefit plans (see: Pharmacy benefit management). My only question at this point is why has it taken so long to try to correct the "PBM problem." Part of the reason is that some of the PBMs were kicking back money to the health plans in exchange for not being viewed with too critical an eye.

Need for More "Disruptive" CEOs of Health Systems; What Does This Mean?

Some critics of the current health system CEOs assert that some of them are unprepared for what lies ahead in the field. Their primary expertise is often in revenue management and M&A. For most hospitals, however, revenue is shrinking (see: Why Major Hospitals Are Losing Money By The Millions) and many potential mergers have already been achieved. Inpatient stays have also been shrinking  (see: Trends in Hospital Inpatient Stays in the United States, 2005-2014) and threats to outpatient revenues are presented by walk-in retail clinics, urgent care clinics, and UnitedHealth as a major physician employer (see: 30,000 Strong and Counting, UnitedHealth Gathers a Doctor Army). A recent article suggested that more "disruptive" healthcare CEOs are needed (see: As healthcare changes, systems need to broaden search to find disruptive CEOs). Below is an excerpt from the article: 

Four years ago, Dr. Rod Hochman, CEO of Providence Health & Services, hired Aaron Martin away from Amazon to head strategy and innovation. Martin's team has spun out several new products to better engage consumers between episodes of care, then found venture capitalists to turn them into businesses. One is Xealth, which enables physicians to “prescribe” a wide range of nonmedical products or services for patients directly through the electronic health record, including apps, articles, Lyft rides and health-assisting products. Martin said what Hochman hired him to do—build deep digital engagement with consumers—is taken for granted in other industries but is brand new in healthcare. Still, he doesn't think he would ever feel comfortable moving into the Providence CEO role himself. Instead, he urges more healthcare CEOs to learn from Hochman....With healthcare changing rapidly, hospital CEO positions turning over at a high rate, and baby boomer senior executives eyeing retirement, some hospitals and health systems realize their next leaders will need a different set of experiences and skills to successfully navigate that new world. For example, these leaders may have to figure out how to run a “health village” rather than an acute-care hospital....The traditional route to the C-suite—long years of progressively more responsible positions running inpatient hospital operations—may no longer be the best preparation, though hospital experience remains desirable.....Yet many health systems and their boards haven't fully embraced the emerging paradigm and are still hiring leaders to put heads in beds, some observers say. Meanwhile, the most innovative people, who may be exactly what these systems need, are reluctant to join slow-to-change, risk-averse organizations.

First of all, I wanted to get a better understanding of the term digital engagement which is one of strategic goals of many hospital boards. Here are some suggestions about what it might look like in the health sector:

• Blogging.
• Using platforms like Twitter or Facebook.
• Adoption of social media channels on Flickr, YouTube, Twitter or many others to interact with stakeholders and customers.
• Making contact with third parties who run forums and sites and establishing two-way partnerships with them.
• [Allowing customers to provide] feedback, leave comments or vote/rate things online using simple digital tools.

As one example of digital engagement in healthcare, systems can market themselves by a presence on Twitter. However, this is not so simple. I blogged more than two years ago about how Cleveland Clinic uses Twitter to enhance its reputation among physicians and consumers (see: Facilitating Engagement of Consumers using E-Health Tools Like Twitter). What is so impressive for me about Cleveland Clinic's presence on Twitter, which continues to this day, is that their tweets tend not to be overt messages asserting that the system delivers better care. Rather, it addresses topics such as new surgical techniques or details about the treatment of various diseases which have been pioneered there. In other words, it's a quality and value message relayed via tweets. 

For me, the essence of creating a digital engagement campaign by a health system is that the personnel managing such a campaign understand the medium and its subtleties (see: Why Twitter Engagement Is Essential for Brands Today). For example, if I were a health system CEO, I would launch, as only one example, a series of consumer-related lectures on various topics relating to consumer health. I would then publicize them on Facebook and Twitter. I would also post selected video clips of the talks on the various social media. Although such talks would be classified as consumer health education, they would buttress the reputation of the sponsoring health system among consumers as being innovative and forward-looking and with an understanding of digital marketing.  

A Look Back in Time: Free Internet Access in Hospitals

This note marks the beginning of a new continuing series in which I will look back in time and quote an earlier blog note. I will then comment about how the key ideas covered earlier have changed in the ensuing years.

In January, 2006, I posted a note about the innovative idea at that time of providing free Wi-FI to patients and visitors in a hospital (see: Free Wi-Fi for Patients in Hospitals). Here is a quote from the article:

The Richardson Regional Medical Center now provides free Wi-Fi Internet access to patients and visitors throughout the hospital. What started as a WLAN to support paperless charting became a broader deployment. Today, the entire hospital is on a Wi-Fi system. The system includes waiting rooms, patient rooms and associated medical office buildings. Access is also available to clinical personnel and for business functions. The clinical and business operations are completely separate from patient access so that no one can tap into the hospital's confidential records, [CIO Ronald] Franquiz said. "We definitely have total control to make sure that our business network and hospital network are not affected at all."

Richardson Medical Center was far ahead of its time by offering Wi-Fi to visitors and patients in 2006 in that Wi-Fi had only been invented in 1997 (see: The History of WiFi). Normally, hospitals tend to be relatively late adopters of information technology. Many of the users of this service in 2006 were probably using labtop computers; few had smart phones (see: Smartphone). Here's a brief discussion of the history of smartphones:

In 2007, the LG Prada was the first mobile phone released with a large capacitive touchscreen. Later that year, Apple Inc. introduced the iPhone, which used a multi-touch capacitive touch screen. Such phones were notable for abandoning the use of a stylus, keyboard, or keypad typical for smartphones at the time up till the early 2010s, in favor of a capacitive touchscreen for direct finger input as its only input type. The iPhone was "not a smartphone by conventional terms, being that a smartphone is a platform device that allows software to be installed", until the opening of Apple's App Store a year later, which became a common means for smartphone software distribution and installation.

Fast forward twelve years -- Wi-FI for guests and patients would be considered obligatory for most hospitals and health systems in the U.S. Nearly all of these users will probably have smartphones. As to the reason for accessing the Internet when in a hospital, some will probably be viewing their social media accounts like Facebook which was launched in 2004. Others may be scanning the news or communicating with friends via email or instant messaging, perhaps to occupy themselves when waiting for an appointment. Even more importantly, though, is that access to the Internet does enable patients perhaps to search for information regarding an operation that they will undergo or seek details about a disease that has been diagnosed with. As only one example, here is Youtube video describing a laparoscopic appendectomy. Wi-Fi access in public spaces like hospitals has become nearly mandatory.

CMS Adds Home Monitoring Reimbursement to Home Health Payments

I have blogged previously about the growing decentralization in healthcare with an increasing number of services provided away from hospitals and with movement toward consumer homes (see: TEN MAJOR TRENDS FACING THE HEALTHCARE INDUSTRY IN THE AMBULATORY SPACE ON A FIVE-YEAR HORIZON; Mobile Health Teams as a Variant on the Theme of Decentralized Acute Care in the Home). New technology is providing cost-effective and useful solutions in terms of home monitoring devices (see: Top 10 Remote Patient Monitoring Companies for Hospitals).

A key element in the success of new ways to deliver healthcare has always been whether reimbursement for new models of care is available. CMS has proposed changes to the Home Health Prospective Payment System that would provide incentives for the use of remote monitoring devices (see: CMS Proposal Adds Remote Patient Monitoring in Home Health Payments). Below is an excerpt from a recent article on this topic:

In [a recent announcement]..., the agency stated that these changes will advance its efforts to put patients over paperwork and prioritize value-based care....Specifically, CMS proposed to allow home health providers to include remote patient monitoring tools as an allowable Medicare cost. This means providers could be compensated for using some remote patient monitoring technologies, making a financial case for the patient engagement tools. CMS defined remote patient monitoring as “the collection of physiologic data (for example, ECG, blood pressure, glucose monitoring) digitally stored and/or transmitted by the patient and/or caregiver to the [home health agency]....Allowing Medicare patients to receive more care and treatment from the comfort of their homes may have a positive impact on patient satisfaction and quality of life. Research indicates that more patients want to age in their own homes, rather than receive complex treatment inside of a medical facility. Remote patient monitoring makes that preference possible by allowing clinicians to track important patient metrics from afar. When a patient does need in-person medical attention, remote patient monitoring devices typically alert the clinician to the issue, making care seamless for patients.

All of this activity suggests that healthcare professionals will soon be facing a deluge of clinical data, some of which will need to be monitored. However, I have an inkling that hospitals will be slow to embrace home health monitoring and that large companies like UnitedHealth may be leaders in the field. I base my prediction on the following ideas:

• UnitedHealth is already functioning as a major service provider with its rapidly expanding MedExpress business unit (see: UnitedHealth plans to bet bigger in Texas).
• Health data monitoring requires sophisticated information technology. UnitedHealth has this capability with its Optum division that is already providing IT consultative services to hospitals (see: Optum Expands I.T. Services to Help Hospitals Modernize Their Technology Infrastructure, Meet Rapidly Changing Needs of Care Providers and Patients). 
• Companies like UnitedHealth have access to large amounts of investment capital that will be necessary to provide home health data monitoring services.
• Home data monitoring will require sophisticated algorithms to scan incoming data and issue warnings when intervention is necessary, which also requires capital investment to develop. 
• Home data monitoring will yield abundant patient referrals when rapid intervention is necessary which blends nicely with UnitedHealth's MedExpress division of urgent care centers.

I don't mean to suggest with these points that hospitals and health systems will be locked out of the home monitoring market. As I have noted previously, bedless hospitals are being configured as data-oriented centers and would be ideally suited for home monitoring (see: Some Additional Ideas About the Bedless Hospitals of the Future; The Design of Bedless Hospitals Continue to Evolve Based on Cost and Technology). Moreover, it will be the hospitals and health systems that have responsibility for most of the patients being monitored so they will be, by default, the organizations with the first opportunity to provide home support.

Google, Facebook, Twitter, and Microsoft Pursue Portability Among Web Services

I have been blogging about interoperability between hospital EHRs for nine years. Here's my first note that used this term: Do Hospitals Really Want Interoperable E-Health Records?. I believe that patients should have the right to download a copy of their EHR records and be able to provide it to other hospitals when necessary. This is sometimes referred to as health data portability (see, for example: Hospitals as a Major Barrier to the Pursuit of EHR Interoperability). Warning: if x-ray and pathology test results and digital images are included in such a download, such files may be huge. However, you can now buy a four terabyte external drive for $120. In this same light, Google, Facebook, Twitter, and Microsoft have now initiated a Data Transfer Project, offering data portability between and among these web services (see: Google, Facebook, Twitter, and Microsoft unite: Data Transfer Project promises portability between services). Below is an excerpt from the article:

Many...should be familiar with Takeout, ostensibly now called "Download your Data," which allows you to back up a copy of all the information associated with your account for most of Google's services. Right now you can even use it to transition your Drive storage between providers, but thanks to the upcoming open-source Data Transfer Project....that data may someday be as portable as your phone.... [T]he GDPR mandates data portability so Google didn't have much of a choice—though it could have easily made a minimum, token effort. With Facebook, Twitter, and Microsoft jumping on board for compatibility, the project is making significant progress. The Data Transfer Project can't unify the different proprietary APIs used by services across the web, but it can make tools that are inter-compatible between them, providing developers and users with a set of standardized data formats. So far the project has constructed adapters for seven different services across five data types. It doesn't require anything so tedious or insecure as a manual download and subsequent re-upload, either. The Data Transfer Project allows for services to make the transfer between themselves directly, service-to-service, using a high-security protocol and privacy-protecting encryption. And since it's open source, the code can be inspected and audited by researchers and enthusiasts alike to ensure that user security and liberty is being protected. You can even review, download, and run the framework yourself for your own projects if you so choose....Contributors have already built support for photo, mail, contacts, calendar, and task data formats for APIs available from Google, Microsoft, Twitter, Flickr, Instagram, Remember the Milk, and Smugmug. 

Don't expect to be able to download your medical records any time soon and I am not actually advocating for such an option. However, EHR interoperability among hospitals is critical, particularly for patients with unusual diseases or aggressive neoplasms (see: Promoting Interoperability (PI)). In these latter cases, such a record transfer should include all available digital imaging studies from both radiology and pathology, if available (see: FDA Approves the Philips Digital Pathology WSI Solution for Primary Diagnosis). Incidentally, second opinions for complex cases, particularly cancer patients, are increasingly common and should be reimburable (see: Subspecialty Second Opinions Often Critical to Patient Care). These costs could be waived if the patient is transferred to the consulting hospital. Incidentally, providing co-access to a patient's EHR records in the case of a local hospital and a cancer center would be an ideal scenario for improving the diagnosis and continuing care of cancer patients throughout the country.

Trump Administration Opposes Public Reporting of Hospital Infection Rates

A recent news article highlighted the news that CMS is proposing a new rule whereby hospitals are not longer required to publicly report their infection rates (see: Trump administration rule could stop public reporting of hospital infections despite death toll). Below is an excerpt from the article:

Federal health regulators will have to stop releasing data on hospital infections — which affect one in 25 hospital patients every day — under a proposal set to take effect in November, according to an analysis by patient safety advocates. The Centers for Medicare and Medicaid Services' (CMS) plan, part of a complex 500-page proposed rule, could halt the public disclosure of the "super bug" MRSA, post-operative sepsis and surgical site infections, as well as accidents and injuries ranging from bedsores to respiratory failure after surgery. If the proposed rule is finalized, CMS' Hospital Compare website won't show the infections or safety measures as to do so, the data would have to be in a program the Trump administration said hospitals should no longer have to report infections and other safety problems to. More than 600,000 hospital patients a year contract an infection and sepsis alone kills about 270,000 people a year.

Leapfrog Group, a hospital rating organization, urged patient safety advocates to contact regulators or sign Leapfrog's letter to CMS protesting the plan. Anew hospital infection report out from Leapfrog Wednesday found the percentage of hospitals reporting to the Leapfrog Hospital Survey and achieving zero infections is way down since 2015.....CMS chief medical officer Kate Goodrich said the agency "is committed to transparency of quality and cost information" and denied that it was proposing to remove the information from Hospital Compare. She also emphasized that the changes are up for public comment. Hospitals apparently hadn't been lobbying for the change, but the American Hospital Association said the amount of data required by different federal programs was burdensome and the change would allow them to focus more on patient safety.  

I don't think that most physicians and scientists would refute the fact that hospital-acquired infections are a major health problem. Some smaller percentage of this group would probably agree that one of the most effective ways to address this problem is the public reporting of such data. This type of reporting puts pressure on those hospitals with unduly high rates to improve their performance or suffer the consequences in terms of decreased admissions. I believe that the American Hospital Association functions more as a business lobbying group than as an advocate for quality and therefore supports this new rule. They take such a position nominally based on their stated opposition to bureaucratic red tape and a burdensome regulatory environment.

On this issue, I come down on the side of the Leapfrog group and oppose this rule change. In what universe is patient safety negotiable. Hospitals work in a competitive environment and don't want to be tarred with unfavorable ratings and thus strive to perform better. In my opinion, the Trump administration is corrupt and always favors less transparency because this is what many business owners want. Such rulings often tend to harm consumers. In all issues relating to patient safety, I come down on the side of increased reporting. This is a central tenet of enhanced consumerism in healthcare.

Hospitals Cry Foul Over Anthem's Radiology Reimbursement Policy

In a previous post, I noted that health insurance company Anthem was refusing to pay the hospital rate for outpatient MRIs and CT scans, dictating that their insurance holders receive outpatient imaging services from less expensive free-standing radiology centers (see: Anthem Won't Pay for Outpatient MRIs and CT Scans in Hospitals). Hospitals are fighting back and taking Anthem to court over this policy (see: Hospitals cry foul and sue Anthem over new policies). Below is an excerpt from this article:

County courtrooms are no strangers to contract disputes between local hospitals and insurers. Lately, though, they've had some big cases dropped in their laps as hospitals owned by HCA Healthcare, Sentara Healthcare and Piedmont Healthcare take health insurance giant Anthem to court over its new policies that restrict outpatient imaging and emergency department reimbursement.....The hospitals argue their contracts with Anthem, through its Blue Cross and Blue Shield affiliates, require all parties to agree to such material changes to the policies. They also say the imaging policy isn't really about medical necessity, as Anthem has said, because the insurer allegedly granted exemptions for hospitals that agreed to accept lower rates. The Anthem spokeswoman said the company does not comment on pending litigation.....Some legal experts say the hospitals are standing on solid ground, while others argue Anthem's policies are an important opening salvo to changing healthcare's traditional business model....[T]he underlying issue is the fact that the same services cost more when delivered in inpatient settings than in outpatient settings.....Anthem's cost-shifting strategy aligns with the migration of many healthcare services over the years to cheaper outpatient settings....In every instance, hospitals have resisted the cuts to their revenue....That's what happened when doctors years ago began performing cataract surgeries in outpatient offices, for example.

....[H]ospitals argue that the imaging policy takes away physicians' ability to use their clinical judgment to determine medical necessity, and instead makes it about the site of service.....From the payer standpoint, services covered under hospital-based contracts tend to cost two to three times more than the same ones performed at free-standing clinics, he said.....Part of the reason Anthem's policies in particular are making such a splash is because they're targeting providers themselves. Other carriers have focused on "educating" patients about less-expensive options, a tactic that doesn't get as much attention....UnitedHealthcare...charges higher co-pays for MRI scans performed at hospitals compared with outpatient facilities....Hospitals' legal arguments against Anthem's imaging policy makes material changes to contracts with hospitals without giving proper notice and receiving approval from hospitals.

I have the following observations about this news:

• The hospital strategy of increasing their revenue from profitable lines of business like radiology and the labs to offset losses in others units like ICUs is probably outdated and may not survive various legal challenges such as the one described in this article (see: Identifying the Gap Between Hospital and Free-Standing Prices).
• Hospitals need to directly compete against surgicenters or freestanding radiology centers (see: Tug of War between Hospitals and Surgicenters for Knee Replacements). One of the ways for doing so will be to launch or purchase such businesses (see: How Hospitals Are Rethinking Imaging).
• Meanwhile, health insurance companies like Aetna and UnitedHealthcare are increasingly engaged in direct patient care. I have discussed the merger of CVS with Aetna with the former providing walk-in MinuteClinics in drug stores (see: Details about CVS' MinuteClinic POCT Strategy; Merged CVS and Aetna Will Move Toward a Community-Based Healthcare Model). Meanwhile, UnitedHealthcare has purchased a large physician group so the lines are blurring between health insurance companies and providers (see: UnitedHealth Buys Large Doctors Group as Lines Blur in Health Care).
• The article above points out that health insurance companies have traditionally "educated" their policy holders about how to seek less expensive services (see: CMS Requires Hospitals to Post Prices for Medicare Patients; Useful Step?). Such an approach may now be a thing of the past with direct competition more of the norm for the health insurance companies. 

Another Type of Urgent Care Facility Flourishing for Orthopedic Problems

In a recent note, I discussed how primary care practices and hospital-based ambulatory care are now being forced to compete with both walk-in clinics in retail drug stores and urgent care centers (see: Physicians Are Disappearing from the Front Line of Healthcare). I have just learned about another type of first-line competition for physician and physical medicine practices: walk-in, orthopedic urgent care centers (see: Orthopedic urgent care centers to expand). Below is an excerpt from the relevant article:

A new orthopedic urgent care center operator is expected to start opening centers in Michigan later this year under the Miami-based OrthoNOW franchise as demand for convenience and lower prices sweeps the health care industry....Over the past decade, the number of urgent care centers has exploded in Michigan and nationally as patients seek to avoid a steep emergency room bill or visit more convenient health care settings. Data show there are more than 350 urgent care or walk-in clinics in Michigan, including more than 45 within 20 miles of Detroit, according to Urgent Care Locations LLC.....Most health insurers in Southeast Michigan contract with urgent centers because of their lower cost relative to emergency departments. That steady and reliable reimbursement has helped push the expansion of urgent care. Now, a new breed of urgent cares hopes to convince patients with bumps, bruises, sprains, and even simple broken bones to go to the urgent care rather than the emergency room....[T]he Michigan centers will assess and treat an array of musculoskeletal orthopedic and sports injuries and chronic conditions without appointments. Injuries could affect the foot, ankle, knee, hip, wrist, hand, elbow, shoulder and spine. OrthoNOW also will offer radiology, physical therapy and sports medicine and wellness care.....[The] owner and operator of 1st Choice Urgent Care said his three centers have direct referral relationships with 10 orthopedic surgeons for more serious cases. 

To summarize, a new type of walk-in, urgent care facility is emerging to attend to orthopedic problems including sports injuries and even sinple broken bones. Similar to walk-in retail drug store clinics but unlike many urgent care facilities, these orthopedic centers are staffed by a physician assistant and a medical technician who can also take X-rays but not by a physician. Such orthopedic walk-in facilities represent an expansion of first line health services and one more reason to avoid hospital ERs and primary physician offices. Note also the referral relationship of these centers to orthopedic surgeons for more complex cases.

Health insurance companies are encouraging the use of walk-in urgent care and drug store clinics because they are generally less expensive than hospital ER visits or perhaps even physician office visits. Heres the discussion on the Humana web site pertaining to urgent care center visits by its members (see: Urgent Care FAQs):

When should I visit an urgent care center?

If you have a non-life threatening illness or injury needing immediate treatment, urgent care is a great choice. You’ll receive direct attention from trained clinicians. There are reasons why using an ER for minor and moderate conditions may not be advisable. An ER can be expensive and you may experience long waits for treatment. A primary care physician can be another option. However, your doctor’s office may not be open daily with extended hours, or offer on-site diagnostic tests.

Physicians Are Disappearing from the Front Line of Healthcare

A recent, longish article in the New York Times discussed the "disappearing doctor" from the front line of healthcare by which is meant walk-in retail clinics in drug stores and urgent care centers (see: The Disappearing Doctor: How Mega-Mergers Are Changing the Business of Medical Care). People are flocking to these facilities because they are readily accessible, user-friendly, and efficient. Patients with the most serious injuries and diseases are triaged to hospital ERs so the patient mix at these walk-in centers is more homogeneous. Below is an excerpt from the article:

...[The] reason big players like CVS Health, the drugstore chain, and most recently Walmart, the giant retailer, are eyeing deals with Aetna and Humana, respectively, to use their stores to deliver medical care. People are flocking to retail clinics and urgent care centers in strip malls or shopping centers, where simple health needs can usually be tended to by health professionals like nurse practitioners or physician assistants much more cheaply than in a doctor’s office. Some 12,000 are already scattered across the country....On the other side, office visits to primary care doctors declined 18 percent from 2012 to 2016, even as visits to specialists increased....There’s little doubt that the front line of medicine — the traditional family or primary care doctor — has been under siege for years. Long hours and low pay have transformed pediatric or family practices into unattractive options for many aspiring physicians....

Apart from true emergency situations, patients’ expectations now reflect the larger 24/7 insta-culture of wanting everything now.....[N]ew deals involving major corporations loom over doctors’ livelihoods, intensifying pressure on small practices and pushing them closer to extinction. The latest involves Walmart and Humana, a large insurer with a sizable business offering private Medicare plans. While their talks are in the early stages, one potential partnership being discussed would center on using the retailer’s stores and expanding its existing 19 clinics for one-stop medical care. Walmart stores already offer pharmacy services and attract older people. In addition, the proposed $69 billion merger between CVS Health, which operates 1,100 MinuteClinics, and Aetna, the giant insurer, would expand the customer bases of both. The deal is viewed as a direct response to moves by a rival insurer, UnitedHealth Group, which employs more than 30,000 physicians and operates one of the country’s largest urgent-care groups, MedExpress, as well as a big chain of free-standing surgery centers.

It's very clear that the former front-line of healthcare, the primary care physician office, is under siege. As noted above, "office visits to primary care doctors declined 18 percent from 2012 to 2016 even as visits to specialists increased." I have previously blogged about how some consumers who visit hospital ERs can be presented with "surprise" bills due to out-of-network services and ER facility fees. Publicity about such bills is causing further erosion of visits to ERs in favor of the alternative first-tier services. Hospitals may be partly to blame for this by trying to generate more revenue from ER visits.

There is another problem for primary care physicians on the horizon. More sophisticated computerized algorithms are being developed for deployment in walk-in clinics and urgent care centers to help diagnose and triage serous disease that might otherwise be missed by the NPs and PAs that staff such facilities. Such algorithms are referred to as CAST tools (see: Computer-aided simple triage). I suspect that CAST software in the hands of skilled PAs or NPs could theoretically rival the skill set of a primary care physician working without such a tool. Here is a list of emergency problems where CAST might be used that I copied from the Wikipedia article just cited:

• Pulmonary embolism (PE)
• Aortic dissection
• Coronary artery disease
• Stroke
• Bone fractures
• Internal bleeding
• Pneumoperitoneum
• Idiopathic intracranial hypertension

Addendum on 6/1/2018

(see: Largest US Nonprofit Healthcare System Shrinks Its Hospital Footprint)

One good marker for this trend is the year-over-year change in hospital admissions. Data given to Congress in the latest MedPac (Medicare Payment Advisory Commission) report on Medicare payment policy show that, between the years 2006 and 2016, the cumulative percent change in the number Medicare inpatient discharges per beneficiary declined by 21.8%. During these same years, the cumulative percent change in the number of outpatient visits per Medicare beneficiary increased by 49%!

Israeli Medical Records Placed On-Line to Promote Research

Electronic medical records are being viewed in some smaller countries like Iceland as a national asset. They are viewed as a means to improve population health and also to stimulate research in the country and elsewhere. Iceland has been pursuing such a strategy for years (see: Centralized Health Databases: Lessons from Iceland; Iceland’s Research Resources: The Health Sector Database, Genealogy Databases, and Biobanks; PDF) and Israel now seems to be pursuing a similar goal (see: Israelis' medical records to be put online for research):

The Israeli Cabinet...[recently] passed a decision launching the "National Digital Health Plan." Approximately...$286,490,000) has been budgeted for the plan which includes technological development, international cooperation, concentrated academic and industrial efforts and regulatory changes to encourage data research...."Israel has a gigantic database that embraces almost the entire population, a large population relative to – let's say – the Baltic countries, one of which has one million people in this database; we have almost nine million people. This is a focused database of the health records of almost each and every one of us over the last two decades," Netanyahu said. "This is a great asset and we want to make it available to researchers, developers and companies in order to receive two things: Preventive medicine and personal medicine, personally calibrated for each person." Netanyahu also said, however, that Israelis would need to agree to share their medical information. "Of course, this depends on the agreement of each person – this right is maintained absolutely," he insisted..... According to Prime Minister's Office Director General Eli Groner, "Every doctor in Israel will be able to see the clinical files of over 98% of the population." The new plan, he said, will "unify the system and create a voluntary data bank that will draw researchers and industry here from around the world." "We are upgrading the quality of the digital medical file so that future doctors will be able to make better diagnoses. We are certain that this decision will be of highest importance." 

The Icelandic national database has been developed by a private company called deCODE Genetics. Here is a summary of its business model copied from its web site:

...Iceland, deCODE is a global leader in analyzing and understanding the human genome. A combination of factors provide unprecedented power to uncover the genetic basis of virtually any disease or trait. These include the generous participation of so many Icelanders in our discovery work, our comprehensive genetic and genealogical resources, the relative genetic and social homogeneity of the Icelandic population, and its high quality universal healthcare. Using unique expertise and population resources, deCODE has discovered genetic risk factors for dozens of common diseases....The purpose of understanding the genetics of disease is to use that information to create new means of diagnosing, treating and preventing disease.

Unlike Iceland, Israel's population is extremely heterogeneous. Rather than being primarily a database driven by research considerations like the one in Iceland, the National Digital Health Plan seems to have a dual purpose. It is designed to support health care delivery by an amalgamation of health files for 98% of the population of Israel and also to function as an asset for biotech research. The biotech industry in Israel has been highly successful with one expert asserting that Israeli research is present in between 25% and 28% of the world’s successful biotech-based solutions (see: One in four life science innovations has Israeli roots, says expert).

What is the likelihood that a similar "national digital health plan" could be adopted in the U.S. The answer is: pretty slim. For one thing, we don't have a unique patient identifier (see: Has the Time Come for a Unique Patient Identifier for the U.S.?). For another, we don't have a common EHR and EHR vendors have slow-walked interoperability in the past but there may now be a change in this attitude (see: What Epic & Cerner are doing for interoperability: 11 observations). Finally, the warring, tribal political factions in the country that conjure up paranoic ideas like "death panels" would probably view a national digital plan with suspicion (see: Death panel). Even the NIH is faltering in its attempt to build a large biobank, but this may involve bureaucratic blundering or research overreach (see: The Faltering Effort to Develop an NIH Biobank; Time to Pull the Plug?).