I have not been Raptured, just busy.
Two seemingly unrelated but potentially related items that I saw recently:
Reuters on a bundled payment experiment by United Health:
An experiment changing how U.S. cancer doctors are compensated cut healthcare costs by a third, with no discernible decline in patient health, according to a three-year study by insurer UnitedHealth Group Inc and five medical oncology groups….
In the latest experiment, UnitedHealth, the largest U.S. health insurer, gave participating doctors an upfront payment to cover a patient’s full course of treatment, rather than reimburse them for each individual medical service such as chemotherapy. Findings from the study, which ran from 2009 to 2012, were published online on Tuesday in the Journal of Oncology Practice.
At the five oncology groups in the study, medical costs for 810 patients with lung, breast and colon cancer were $65 million, versus $98 million for similar patients whose doctors received standard payments. That represented a decline of three times what the study had targeted.
Chemo drug costs went up dramatically, but the low hanging fruit of reduced hospitalizations and less imaging services more than compensated for the drug costs.
Kaiser Family Foundation on Medicare spending per capita projections:
Based on our comparison of CBO’s August 2010 and April 2014 baselines, Medicare spending this year will be about $1,000 lower per person than was expected in 2010, soon after passage of the Affordable Care Act (ACA), which included reductions in Medicare payments to plans and providers and introduced delivery system reforms that aimed to improve efficiency and reduce costs. By 2019, Medicare spending per person is projected to be nearly $2,400 lower per person than was expected following passage of the ACA.
These changes are changes of post-PPACA passage to post-PPACA passage, so it is a pure apples to apples touch. I think a significant factor going on here is the show-me first assumptions of the Congressional Budget Office in how they score experimental programs. During the run-up to passage, the CBO would only count as offsets either definative revenue increases (sun tan tax, Cadillac tax, mandate penalty etc) or clearly defined program cuts (Medicare Advantage subsidies). Due to the lack of evidence, the system reform elements that most wonks thought would have significant cost savings (ACOs, bundled payments, global budgets, readmission penalties) were scored as producing no savings. That was the assumption in 2010. We have four years of added data that readmission incentives are working well, ACOs are promising, and bundled payments are getting wider deployment.
PPACA delivery and payment reforms are not the entire story, but they are a significant element of the story.