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The Truven Health Blog


The latest healthcare topics from a trusted, proven, and unbiased source.


Impact of Federally-Run Health Insurance Exchanges


By Anita Nair Hartman/Thursday, February 28, 2013
Anita Nair-Hartman imageA recent American Medical News article highlighted the heavy role federally facilitated exchanges will have now that states have made their decisions on creating exchanges.   Health plans must soon decide whether to participate in public exchanges. To date, 25 states have opted for HHS to run their exchange, and you would think this would streamline operational challenges for health plans. But this is not necessarily true. It’s not clear how much of a role states will have in these federally facilitated exchanges.

From decisions on approving “qualified” health plans to adhering to state insurance regulations, HHS may allow states to have more input into the federal facilitated exchanges.  But for everything we do know about federally facilitated exchanges, there are many unanswered questions. And that, in itself, is adding another layer of complexity as health plans navigate their state exchange strategy and make decisions about their participation. 

Anita Nair-Hartman
Vice President, Market Planning and Strategy

It’s Time to Transform Healthcare – and We in the Industry Know How To Do It


By Michael L. Taylor/Tuesday, February 26, 2013
Mike Taylor imageIn his February 23, 2013 article in the New York Times, Richard Thaler, noted professor of Economics at the Booth School of Business at the University of Chicago, makes several suggestions on how to improve US health care.

Among them are:
  • Paying doctors and hospitals for health, not illness treatment
  • Using evidence-based medicine approaches
  • Making more efficient use of nurse practitioners, pharmacists, physician assistants and other medical professionals
  • Opening opportunities for all patients to have end of life discussions
  • Implementing safe harbor from medical liability under certain situations
  • Incremental changes and experiments with innovation to improve the US health care approach

These are all good ideas that have been under discussion, some for many years. I agree with the ideas, but I would argue in favor of reaching further, reaching for transformational changes. To amplify this thought:
  • The Affordable Care Act opens the door for Accountable Care Organizations (ACOs).  Well designed ACOs have the potential to transform US healthcare in many ways:

  • End of Life discussions and planning are not “death panels,” and we cannot, and must not, get tangled up in arguments based on inaccurate assumptions as a way to avoid these needed discussions.

  • Medical liability reform
A healthcare system implies a uniform, defined approach to problem—something the US does not have. We have a fragmented, expensive sector not designed with the goal of improved health, but organized around principles where the main benefactor is the entire healthcare industry, not the patient. I don’t think we need more experiments; we need transformational change with the goal of achieving the Triple Aim of improving healthcare quality and satisfaction, improving population health, and reducing the cost of healthcare.

Dr Michael L Taylor
Chief Medical Officer

Opting in to Federally-Run Health Insurance Exchanges


By Michael L. Taylor/Monday, February 25, 2013
Mike Taylor imageNew reports show that 26 states will not develop state-run health insurance exchanges, leaving the door open for the federal government to fill this void. Some states are ceding exchange responsibilities completely to the federal government, but many states are actively planning to run their own exchanges as a way to decrease the rolls of the un-insured and provide a credible, state-run solution to address health care disparities. While it is true that federal exchanges have their own set of hurdles, I submit a federal exchange system offer some advantages.

Several years ago, before the decision to allow states the ability to run exchanges was announced, some observers noted the allure of a single federal platform for exchanges.  The drawback to state-run exchanges is the complexity that results from up to 50 different sets of exchanges. A federally run exchanges can offer consistency across the country.  Further, non-discrimination rules and “minimum essential coverage” rules and standards can be more easily monitored in a federal exchange as compared to many models in state exchanges.

Employers with operations and employees in many states, and health plans as well, would appreciate a standard set of rules; for these organizations, navigating a single system may be the better option.

These decisions by states are not final – states annually have the option of starting an exchange, and a standard for exchanges could prove to be the “template” for newer models. We will all see how this develops, but I wouldn’t be surprised to see consolidation in these exchanges of the future, rather than re-inventing the wheel 50 times.

Michael Taylor, MD
Chief Medical Officer

Price Transparency: How much will that medical procedure cost?


By Bill Bithoney/Friday, February 22, 2013
Bill Bithoney imageWhen buying a new car I want to know the exact price including financing charges before I sign on the dotted line. When I had my roof repaired last week I knew its exact cost before the work began.  However, if I call a hospital  to inquire how much a hip replacement will cost for my balky limb, the answer I will get from most hospitals is either vague or more typically no answer at all. You might be surprised to learn that many hospitals really do not know the cost for even relatively common healthcare services received in their facilities.

Researchers at the University of Iowa recently found in a survey of 120 hospitals that only 19 were able to give consumers an exact price for a hip replacement. Further when prices were given, they varied by roughly 1200%, from $11,000 to over $125,000, for the same procedure! They were provided with standard assumptions to help ensure accurate comparisons. Correcting this surprising gap in knowledge about their own costs is a critical step toward improving the cost of care. And providing apples-to-apples cost information to patients is the next step because, in a significant departure from today’s ‘normal,’ patients are becoming increasingly price sensitive.

Self insured employers and health plans are considering offering incentives such as splitting the cost savings when employees choose lower cost, high quality providers.  If employers rewarded employees for choosing lower cost providers who have demonstrably excellent outcomes, the business of elective surgery and non-emergent medicine would take a long stride forward in becoming price sensitive.  Most experts agree that this would quickly result in hospitals beginning to compete on price – and that would begin bending the health care cost curve in the right direction!

Dr William Bithoney

Managed Medicaid Businesses Expansion


By Anita Nair Hartman/Friday, February 22, 2013
Anita Nair-Hartman imageThe expansion of Medicaid will bring opportunities for strong enrollment growth to health plans with managed Medicaid businesses. To optimize this membership growth, health plans need to create products with care management strategies that can effectively and efficiently manage this population’s unique healthcare needs.

Our studies show their health and utilization patterns are different from those of existing Medicaid beneficiaries and from those who have employment-based insurance. Health plans must carefully evaluate their plan design and program impacts to best manage costs and care. Plans operating in multiple states will have the further complexity of targeting their strategies to align with the Medicaid expansion decisions.

Anita Nair-Hartman
Vice President, Market Planning and Strategy

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