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The Vitals - December 2014

Internal Medicine Alert - Infectious Disease Alert - Clinical Cardiology Alert
Integrative Medicine Alert
- OB/GYN Clinical Alert - Primary Care Reports
Hospital Medicine Alert
- Contraceptive Technology Update
- Neurology Alert

Price Tag for ICD-10 Conversion May Be Far Lower Than Originally Estimated

SAN FRANCISCO – Concerns about the burden of time, cost and lost productivity was a factor in CMS’ decision to delay implementation of ICD-10 to October 2015.

A new vendor study, however, suggests the costs of ICD-10 conversion may have been overstated. The report appeared recently in the Journal of AHIMA, published by the American Health Information Management Association.

The report from 3M Health Information Systems Inc. revises the estimated costs to a range of $1,960 to $5,900 for ICD-10 conversion to be accomplished by a small practice – defined as three physicians and two affected staff members, such as coders and front desk/back office personnel.

A recent 2014 update of a widely referenced 2008 report by Nachimson Advisors to the AMA estimated the cost for a small practice to implement ICD-10 at $22,560 to $105,506, the authors point out. Since the Journal of AHIMA article was published, Nachimson has said it stands behind its original estimates and finds fault with the 3M authors’ assumptions.

In both cases, the calculations essentially took into account efforts required to perform necessary assessment, training, software conversions, testing, and “super bill” updates. The new study suggests, however, that physician offices, health plans and vendors all have made greater progress toward that goal with fewer resources than anticipated.

One issue, according to the authors, is that costs related to EHR adoption and other healthcare initiatives, such as meaningful use, were included in some conversion cost estimates even though they are not directly related. In addition, the coding industry is much more knowledgeable and ready for ICD-10 now than previously reported.

Another big factor is the availability of lower-cost training resources. The report mentions the following:

  • Online clinician documentation and coding training can be purchased for $50 to $300 for three hours of training in a particular specialty, and free educational websites are available to help make the transition to ICD-10 easier;
  • The ICD-10 Diagnoses Code book can be downloaded for free and is also available from publishers for $70 to $300.
  • An ICD-10 iPhone App allows a word search function to find an ICD-10 code for $1.99; a free version with fewer functions also is available;
  • Comprehensive ICD-10 training for staff ranges from $350 to $700 and that can include “implementation” type training where managers then return to an office and train other administrative staff. For example, the Michigan State Medical Society offers comprehensive ICD-10 training for physicians and staff for $400.

The authors also cite some recent surveys estimating implementation costs for small practices at about $750 per provider, which would be in line with their estimates.

In fact, according to the report, some physician offices may incur no additional costs at all for basic software services and related conversions, because many vendors are including ICD-10 as part of their routine annual software update.

The study references an August 2014 survey from the Workgroup for Electronic Data Interchange finding that two-thirds of vendors had ICD-10 versions of their products already available and that two-fifths of the ICD-10 products and services were complete at that point.

“Physicians are relying heavily on their vendors, such as billing services, software vendors, and clearinghouses. Furthermore, many small practices are depending on their integrated EHR vendors to provide the necessary training for ICD-10 as well as absorbing the conversion costs,” the authors write.


Making Generics “Default” on EHR Increases Prescriptions Over Brand Names

PHILADELPHIA – Group practices that want physicians to be more sensitive to patients’ cost concerns by prescribing generic drugs whenever possible may have an easy way to make that happen.

A new study, published in a special issue of the Annals of Internal Medicine, suggests that programming electronic health records (EHR) to make generic drugs the default choice can influence physician prescription choices. Researchers were from the Perelman School of Medicine, The Wharton School and the Center for Health Incentives and Behavioral Economics, all at the University of Pennsylvania and the Philadelphia VA Medical Center.

"Prescribing brand-name medications that have a generic equivalent is a prime example of unnecessary health care spending because in most cases, generic medications are less expensive, similar in quality and may actually lead to better outcomes than brand names because of higher rates of patient adherence to generics," said lead author Mitesh S. Patel, MD, MBA, MS. “The results of this study demonstrate that leveraging default options can be very effective way to change behavior."

Involved in the study between June 2011 and September 2012 were four ambulatory clinics -- two internal medicine and two family medicine -- in the University of Pennsylvania Health System. Researchers evaluated the difference in prescribing behavior for three commonly prescribed classes of medications -- beta-blockers, statins and proton-pump inhibitors -- between family medicine and internal medicine physicians. More than 20,000 prescriptions were reviewed.

During the intervention phase of the study, family medicine physicians were shown both brand name and generic medication options within the EHR medication prescriber portal, but internal medicine physicians were shown a different display of only the generic medication options, with the ability to opt out.

During the pre-intervention period, family medicine providers had slightly higher rates of generic medication prescribing but both groups had similar trends, according to the study.

In the post-intervention period compared to the pre-intervention period, however, internal medicine providers saw a 5.4% increase in generic prescribing compared with family medicine providers for all three medications combined, including 10.5% for beta blockers and 4% for statins.

The result for proton-pump inhibitors, essentially a 2.1% increase, was not statistically significant.

"Not only was changing the default options within the EHR medication prescriber effective at increasing generic medication prescribing, this simple intervention was cost-free and required no additional effort on the part of the physician," Patel explained. "The lessons from this study can be applied to other clinical decision efforts to reduce unnecessary health care spending and improve value for patients."


Less Competition Allows Practices to Charge More, Raise Prices Faster

STANFORD, CA – Competition significantly drives down what physician practices can charge, according to a new study which also found that areas with fewer health care options also saw much more rapid price increases between 2003 and 2010.

The study, conducted by researchers from Stanford University School of Medicine and the National Bureau of Economic Researchers, found that the top 10% of areas with the least competition had prices ranging from $5.85 to $11.67 higher for "intermediate" office visits than those in the 10% of markets with the highest levels of competition.

Overall, according to the report published in the Journal of the American Medical Association, in the most conservative model, being in the top 10% of areas with the least competition was associated with 3.5% to 5.4% higher mean price.

The study was focused on prices paid in 2010 for office visits by preferred provider organizations (PPOs), the most common type of health insurance plan held by privately insured people in the United States.

Included was data from 1,058 U.S. counties in urbanized areas, representing all 50 states. The researchers determined the average price PPOs paid per county for office visits by established patients to physicians in 10 specialties. They then used a price index measuring the county-weighted average price for 10 types of office visits with new and established patients relative to national average prices. The specialties were internal medicine, family practice, cardiology, dermatology, gastroenterology, neurology, general surgery, orthopedics, urology, and otolaryngology.

"The research comes out of trying to understand some dramatic changes that have occurred in the health-care system over a couple of decades," said lead author Laurence Baker, PhD, professor of health research and policy at Stanford.

A factor in lowering competition is the shift from practices with one or two doctors toward larger, more complex organizations with many physicians, according to the report.

"This has always been an important issue, and now it's even more important as policy moves us more and more toward larger practices," added co-author Kate Bundorf, PhD, associate professor of health and research policy.

Bundorf pointed out that, because of the issue of competition, the push from the private sector and Medicare to form larger practices may be a mixed blessing. While the benefits of larger groups are clear, she said, there has been little evidence on how the lessened competition affects national healthcare spending.

"It's an important question for the U.S. health-care system right now. If we move toward larger practices, how can we get the benefits but avoid the challenges higher prices would create?" Baker questioned.


Despite Health System Issues, Older U.S. Patients Satisfied With Physicians

NEW YORK – Healthcare in the United States may fall short of other industrialized nations in some ways, but, as much as anywhere else, older patients in this country reported good relationships with their doctors.

That’s according to a new report, published recently in the journal Health Affairs, from the Commonwealth Fund.

Researchers conducted a computer-assisted telephone survey of the health and care experiences of 15,617 adults 65 or older in Australia, Canada, France, Germany, the Netherlands, New Zealand, Norway, Sweden, Switzerland, the United Kingdom, and the United States.

Older adults in the U.S. tended to be sicker than those in other industrialized nations. For them, out-of-pocket expenses, accessing primary care and avoiding the emergency department also were greater problems than for older patients in most of the other countries surveyed.

On the other hand, U.S. respondents were among the most likely to have discussed health-promoting behaviors with a clinician, to have a chronic care plan tailored to their daily life, and to have engaged in end-of-life care planning, according to the report.

Most of the respondents, ranging from 79% in Sweden to 94% in both France and the Netherlands, said they felt as if their doctors spent enough time with them, and most also said they were encouraged during office visits to ask questions about their health and care.

“American respondents were particularly likely to report that their doctors had discussed with them how to live a healthy life,” the authors write. “The United States was at or near the top in the reported frequency with which doctors discussed diet or exercise (76%) and stress (29%) with their patients.”

The United States, with the United Kingdom, also was one of the top performers when it came to receiving support from providers in managing chronic conditions. Nearly 60% of older patients in those two countries said they were able to discuss their goals in caring for their conditions and received clear instructions when to seek further care. Fewer than half of patients in the other surveyed nations had that response.

Researchers note that industrialized nations are trying to “retrofit” their current health care delivery systems, originally designed to treat acute illnesses, to better manage chronic diseases.

The report points out that, In the United States, 85% of all health care services are currently used by people with at least one chronic disease, and $140 billion of Medicare spending in 2010 – almost half of total expenditures – goes for care of the 14% of Medicare beneficiaries with six or more chronic conditions.

“With older patients often receiving care from multiple providers, taking multiple prescription drugs, and managing complicated care regimens, these people are vulnerable to health system failures that can result in fragmented and poorly coordinated care, as well as costly and injurious medical errors,” the authors write.