Tag: COVID-19

Vaccine reimbursement is equal across providers and insurers. What if we did the same for all care?

April 5th, 2021 by
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What adjustments are needed?

A seemingly straightforward story caught my eye last week: all Massachusetts providers are being paid the same, generous fee for COVID-19 vaccine administration (Boston Globe). The fee is essentially identical whether the patient has Medicaid, Medicare, commercial insurance –or no insurance. And it doesn’t matter whether the shot is given in a pharmacy, clinic, community hospital, or academic medical center.

It seems logical and makes intuitive sense to the average consumer. But for those in the healthcare field, it’s pretty radical! After all, reimbursement rates for commercially insured patients are usually a multiple of what Medicaid pays and substantially higher than Medicare. And providers and insurers exert extreme efforts negotiating rates (and then trying to keep them secret). Some providers use their market power to drive harder bargains, and insurers do the same.

Bottom line: Reimbursement rates are all over the map, varying wildly depending on who’s the provider and who’s paying. A 2020 Health Care Cost Institute study provides some detail.

This reality has shaped and distorted the US healthcare system:

  • Providers avoid Medicaid patients to cherry pick those with commercial coverage
  • The true cost of Medicaid (and to a lesser extent, Medicare) is obscured by cross-patient subsidies
  • Providers use their market power to extract higher rates, and generate reimbursement ‘synergies’ by acquiring providers with weaker negotiating positions or reclassifying  physician offices as hospital ‘facilities’ that generate their own upcharges
  • Patients get treated in settings that maximize providers’ margins rather than where it’s best for the patients
  • Health plans merge to bulk up against provider systems
  • Health disparities are exacerbated as poorer patients are worth less to providers and get lower priority
  • Tremendous administrative costs are expended to manage the complexity, exploit the rules and search for those who are bending or breaking them

It’s tempting to think we could reform healthcare payment by using this COVID-19 vaccine approach for all reimbursement. But the vaccine is a special case, because there is a specific, national objective to get as many people vaccinated as quickly as possible to end the pandemic and because vaccine administration is pretty simple. Lots of providers are capable of it, and there are unlikely to be differences in outcomes based on provider experience or setting. Across the political spectrum, there is genuine agreement that we want everyone –including poor people and immigrants regardless of status– to get a shot or even two. And we’re happy for providers to prioritize vaccination by allowing them to make good money doing it.

Those conditions don’t hold generally in healthcare. Still, I am in favor of policies that encourage or mandate reducing the gaps in what providers are paid for the same service. There should be a convergence between Medicaid, Medicare and commercial rates, and reimbursement should not vary so dramatically by provider or setting of care.

New approaches, like alternative payment models, often bake in the fee-for-service biases. They shouldn’t.


By healthcare business consultant David E. Williams, president of Health Business Group.

How vaccine success and fourth surge are connected. David Williams in the Boston Globe

March 31st, 2021 by

It’s counterintuitive: a fourth covid-19 wave is evident even as vaccine rollout accelerates. Conventional wisdom blames it on more contagious variants, pandemic fatigue, and states reopening too fast. There’s truth to all of that, but it overlooks the role that vaccination itself plays.

David Williams shared his thinking with the Boston Globe (CDC Director Walesnsky stresses ‘hope,’ not ‘doom,’ after touring Hynes Convention Center. Vaccinations are accelerating even as COVID-19 cases also rise.)

“As spring comes, people in their 20s are relaxing their behavior and going out to restaurants with their friends,” said David Williams, president of Health Business Group, a Boston management consulting firm. “They don’t have to feel as guilty about infecting them if Ma and Grandma have already been vaccinated.”

Now that the old are vaccinated, we need to make sure young adult vaccination is quickly ramped up. There should be plenty of vaccine available shortly to do so.

“This is the time when we’re going from scarcity to surplus,” said Williams of the Health Business Group. “People who are eligible are now getting appointments, even if they have to work a bit, and a lot more people are now eligible. It still feels tight. But in the next two to three weeks, instead of waking up at 1 in the morning to book an appointment, you should be able to do at 2 in the afternoon.”

 

How the new surge and vaccine success are connected

March 31st, 2021 by
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Catch a wave and you’re sitting on top of the surge

It’s counterintuitive: a fourth covid-19 wave is evident even as vaccine rollout accelerates. Conventional wisdom blames it on more contagious variants, pandemic fatigue, and states reopening too fast. There’s truth to all of that, but it overlooks the role that vaccination itself plays.

I shared my thinking with the Boston Globe (CDC Director Walesnsky stresses ‘hope,’ not ‘doom,’ after touring Hynes Convention Center. Vaccinations are accelerating even as COVID-19 cases also rise.)

“As spring comes, people in their 20s are relaxing their behavior and going out to restaurants with their friends,” said David Williams, president of Health Business Group, a Boston management consulting firm. “They don’t have to feel as guilty about infecting them if Ma and Grandma have already been vaccinated.”

It’s actually pretty straightforward. We’ve asked younger people to make severe sacrifices over the past year. A central argument has been that they are protecting their older relatives and others in society, who are at mortal risk if infected. Now that the old are largely protected through vaccination, the argument loses its logic.

Vaccine rollout priority has focused on reducing death and hospitalization. That’s why we started with the elderly. If we wanted to reduce the number of infections, we would have started with the young.

Now that the old are vaccinated, we need to make sure young adult vaccination is quickly ramped up. There should be plenty of vaccine available shortly to do so.

“This is the time when we’re going from scarcity to surplus,” said Williams of the Health Business Group. “People who are eligible are now getting appointments, even if they have to work a bit, and a lot more people are now eligible. It still feels tight. But in the next two to three weeks, instead of waking up at 1 in the morning to book an appointment, you should be able to do at 2 in the afternoon.”

Today’s news that the Pfizer vaccine seems to work well in kids and not pose safety concerns is also great news. We should vaccinate the whole population by summer if at all possible.

Image by Manie Van der Hoven from Pixabay


By healthcare business consultant David E. Williams, president of Health Business Group.

Boston Globe quotes David Williams on improving COVID-19 vaccine rollout in Massachusetts

February 10th, 2021 by

David Williams was quoted in the Boston Globe (With capacity increasing, signs of progress in Mass. vaccination push)

Immunizing the state’s oldest residents also will be key to slowing the pandemic, said David Williams, president of Health Business Group, a Boston management consulting firm, who has been critical of the state’s slow start.

“There’s been good progress over the past week or two in reaching the 75-and-over group, and that will make a difference in reducing severe illness, hospitalization, and death,” Williams said.

COVID-19 vaccinations are going poorly in MA. I’m quoted in the Boston Globe

January 29th, 2021 by

For months we’ve been focused on the shortage of COVID-19 vaccine doses. That’s still a problem, but for now the bottlenecks are further downstream. Massachusetts is struggling to get the doses distributed and administered. More than half sit unused. Even if we have 10 million (or a billion) doses we’d still be stuck.

In today’s Boston Globe (State’s hope of vaccinating almost everyone by the end of summer depends on a lot going right) I encourage the state to assume there will be enough vaccines and just get them out to people.

“We’re only using half of what we’ve been given,” said David Williams, president of Health Business Group, a Boston management consulting firm. “It’s not an excuse to say because supplies are slow, we can just sit back. We should assume there’ll be more supply, and we owe it to the citizens of Massachusetts to be ready when it comes.”


By healthcare business consultant David E. Williams, president of Health Business Group.