What's New with HCFO - February 21, 2006 (Print All Articles)
HSAs Form Conerstone of President's Health Agenda
HSAs Form Cornerstone of President’s Health Agenda
The State of the Union on, January 31, provided the first glimpse into the President’s plans for addressing America’s health care needs. (1) Health Savings Accounts (HSAs), the cornerstone of the Bush administration’s efforts to improve access and control costs, continue to be the primary focus. The new proposals strive to expand the use of high-deductible health plans in conjunction with HSAs.
The President proposed a number of tax incentives to encourage HSA expansion. These include allowing individuals to set aside enough tax-free money to cover all out-of-pocket expenses, including premiums, rather than just the deductible as allowed by current law. Bush also proposed a tax credit to offset payroll taxes for those purchasing insurance in the non-group market. This is intended to level the playing field so people who buy insurance have the same tax advantages as people who get the HSAs through employers.
While these proposals may encourage enrollment in high deductible plans, it is unclear if they will be enough to entice individuals to save the needed funds for health care expenses. Preliminary reports show that half of current participants have not set aside money and over one-third of employers have not contributed funds to savings accounts. (2, 3) This could leave many vulnerable to the high cost sharing requirements for care under the deductible, especially those with high health care needs or lower incomes.
The President hopes to address the criticism that HSAs are for the healthy and wealthy by providing a tax credit for lower-income people who enroll in HSAs and allowing employers to make additional contributions to accounts of those with chronic conditions.
Since 2003, about 3 million people have enrolled in HSA plans. Estimates indicate the President’s proposals would increase enrollment to 21 million by 2010 and cost $60 billion over five years. (4, 5) It is still unknown if these plans will decrease overall health care spending.
Roy Ramthun, Special Assistant to the President for Economic Policy, spoke at the AcademyHealth National Health Policy Conference 2006 on the President’s desire to make the insurance portion of HSAs as portable as the accounts, which could protect individuals from future medical underwriting. To provide true portability, Ramthun stated, “The President is suggesting that it may be time to look at a federal regulatory structure…similar to the ERISA structure that is available through the Department of Labor for self-funded employers today.” (6) Research conducted by HCFO grantee, Phyllis Borzi of The George Washington University, explored the complex variations and liability issues present under ERISA. The interest in an ERISA-based regulatory structure raises serious questions regarding liability and the tension between federal and state malpractice and tort laws. (7)
The administration has also acknowledged that a major frustration for consumers with HSAs is that they cannot make well-informed medical decisions without improving the availability of pricing and quality information. (9) Allan Hubbard, Director of the National Economic Council announced at a press briefing following the State of the Union that the President is going to be, “working with employers and insurance companies to encourage them to work with us to insist that providers provide this information.” (8) The increased attention of the President and his Administration may be a signal that they are considering the fact that the current system may require additional assistance from the federal government. Ramthun stated at the NHPC that, “The President is looking to Medicare and the federal employees program to help actually provide some of this information to Americans.” (9)
HCFO has recognized the importance of effectively providing health care information and has funded several new grants examining consumer information and behavior. Dr. David Blumenthal of Massachusetts General Hospital is developing effective methods to assist consumers in selecting high performing physicians within consumer-directed health plans. Dr. Jean Abraham of University of Minnesota is examining the use of decision support tools to inform health plan selections and quality. The third project is being conducted by Dr. Meredith Rosenthal of Harvard University to evaluate the potential for Health Risk Appraisals, a tool to engage consumers in health management, to impact enrollee behavior.
In addition to the grants mentioned above, information on HCFO grants, issue briefs, and articles addressing Health Savings Accounts, high-deductible health plans and consumer-driven care can be found on the HCFO website.
HCFO Funded Research:
Title: Involving Consumers in Physician Choice: Making Data into Useable Information for Chronically Ill Patients in Consumer-Directed Health Plans
Institution: Massachusetts General Hospital
Principal Investigator: David Blumenthal
Time: March 2006 - August 2007
What tools will consumers need to help select high performing physicians, within CDHPs? Physician performance data is one of the tools that can be used to help consumers make these decisions. However, there are important opportunities and challenges facing consumer-directed health plans (CDHPs) trying to engage consumers in using physician performance data (PPD). The specific aims of the project are: 1) to develop methods for informing consumers about physician clinical performance; 2) to test the effectiveness of these methods in helping consumers with chronic conditions in CDHPs to make an informed choice of primary care physician (PCP); 3) to explore how consumer characteristics affect their ability to understand PPD and their response to that data. The objective of this study is to understand how and whether PPD can be appropriately and effectively used in CDHPs.
Click here for further information on this grant.
Title: The Impact of Consumer Health Plan Decision Support Tools on Health Plan Choice and Quality
Institution: University of Minnesota
Principal Investigator: Jean Marie Abraham, Ph.D.
Time: January 2006 - April 2007
The researchers will examine the use of decision support tools to inform health plan selections. Because of the concern regarding the abilities of consumers to understand the financial implications of an array of complicated plan designs when choosing among health insurance options, decision support tools are being developed to help consumers evaluate their health plan options. In March of 2006, Ingenix will develop will release a Plan Cost Estimator (PCE) that can track use of individual employees and incorporate prior claims experience into the algorithm for producing cost estimates. Using this decision-support tool, the researchers will investigate the following research questions: 1) what factors are associated with the decision by an employer to provide a decision support tool for its workers during open enrollment; 2) which demographic, health status, and job-related factors are associated with a worker's use of the PCE tool; 3) does decision support tool use directly influence a worker's choice of health plan; and 4) is there an association between low-cost plan choices and quality, and by how much does expected quality change as a result of tool use. The objective of this study is to identify important managerial lessons for employers relative to employee health plan enrollment choices.
Click here for further information on this grant.
Title: Uptake and Impact of Health Risk Appraisals
Institution: Harvard University of Public Health
Principal Investigator: Meredith B. Rosenthal, Ph.D.
Time: December 01, 2005 - November 30, 2006
What is the potential for Health Risk Appraisals (HRAs) to engage consumers in health improvement? HRAs are structured surveys designed to identify a wide range of health risks, including genetic predispositions to disease, poor health habits (e.g. smoking, overweight) and lack of adherence to recommnede care for a chronic condition. HRAs allow health plans and employers to engage consumers in health management before acute events occur. Using data from Cigna HealthCare, the researchers will address the following specific aims: 1) examine the overall rates of HRA completion in a privately-insured population; 2) examine the impact of a consumer financial incentive on HRA completion; 3) examine the characteristics of consumers who opt to complete an HRA; and 4) look for early effects of HRAs on utilization and health behavior. The objective of the project is to help employers and health plans better tailor their outreach programs, evaluate whether to offer incentives, and better understand the impact HRAs will have on enrollee behavior.
Click here for further information on this grant.
1. White House Office of the President. “State of the Union,” January 31, 2006, Washington, D.C. Also see: http://www.whitehouse.gov/stateoftheunion/2006/
2. Freudenheim, M. “Prognosis Is Mixed for Health Savings,” The New York Times, January 26, 2006.
3. Kaiser Family Foundation and Health Research and Educational Trust. “Employer Health Benefit 2005 Annual Survey,” September 2005. Also see: http://www.kaiserfamilyfoundation.org/insurance/7315/index.cfm
4. White House Office of the President. “Press Briefing by Al Hubbard on the President’s Health Care Initiatives for 2006,” February 1, 2006, Washington, D.C. Also see: http://www.whitehouse.gov/news/releases/2006/02/20060201-1.html
5. Kaisernetwork. “President Bush Releases FY 2007 Budget Proposal; $36B Medicare Spending Reduction Expected to Have Difficult Approval Process,” Kaiser Family Foundation, February 7, 2006. Also see: http://www.kaisernetwork.org/daily_reports/rep_index.cfm?hint=3&DR_ID=35249
6. Ramthun, R. “Roy Ramthun speaking on the Administration’s health agenda,” National Health Policy Conference, AcademyHealth, February 6, 2006. Also see: http://kaisernetwork.org/health_cast/hcast_index.cfm?display=detail&hc=1614
7. Borzi, P. “ERISA Health Plans: Key Structural Variations and their Effect on Liability,” Changes in Health Care Financing and Organization Issue Brief, AcademyHealth, September 2002. Also see: http://www.hcfo.net/pdf/borzi.pdf
8. White House Office of the President. “Press Briefing by Al Hubbard on the President’s Health Care Initiatives for 2006.”
9. Ramthun, R. “Roy Ramthun speaking on the Administration’s health agenda.”
Grantee Spotlight - Kevin A. Schulman, M.D., M.B.A.
Grantee Spotlight - Kevin A. Schulman, M.D., M.B.A.
Kevin A. Schulman, M.D., M.B.A., is professor of medicine and vice chair for business affairs in the Department of Medicine in Duke University’s School of Medicine. He is also a professor in The Fuqua School of Business at Duke University. Schulman serves as director of the Center for Clinical and Genetic Economics in the Duke Clinical Research Institute and as director of the Health Sector Management Program at Fuqua. Under his leadership, the Health Sector Management Program has grown to more than 160 daytime M.B.A. students from 18 countries, and 60 executive M.B.A. students.
His research specialties include economic evaluation of new medical technologies and new clinical programs; health services and policy research, including access to care and the impact of reimbursement policies on clinical practice; clinical decision making, especially by patients with life-threatening conditions; pharmaceutical policy; biotechnology; and consumer health information technology.
Schulman received his M.D. from the New York University School of Medicine and his M.B.A. from the Wharton School at the University of Pennsylvania. He holds appointments at the Duke Center for Clinical Health Policy and the Durham Veterans Affairs Health Services Research Unit. Schulman has served since 1999 as a member of the National Advisory Committee for the Investigator Awards in Health Policy Research of The Robert Wood Johnson Foundation.
In HCFO-funded work, Schulman examined the relationship between market forces and the cost, treatments, and outcomes of Medicare patients with acute myocardial infarction (AMI). The study found that the level of managed care activity in the health care market affects the process of care for Medicare fee-for-service AMI patients. Spillovers from managed care activity to patients with other types of insurance are more likely when managed care organizations have greater market power. “If managed care promotes efficiency, then all patients in a market may benefit,” Schulman said. “However, if managed care lowers costs by offering lower-quality services, spillover may adversely impact Medicare beneficiaries and others in the market.”
Schulman also worked on a HCFO-sponsored study with a team from the Georgetown Institute for Health Care Policy and Research, which explored selective contracting for tertiary care services by managed care plans. The team found that as the amount of managed care and/or hospital competition in an area increases, price of services will overshadow quality in relative importance. “The most interesting aspect of this work is how much each market had its own dynamic. In more sophisticated markets, purchasers appeared to evaluate hospitals on a more comprehensive basis.”
In addition to his HCFO-sponsored work, Schulman’s other research includes studies of health disparities, publication of clinical research studies, efficiency of new medical technologies, and descriptive studies of medication use.
For more information on Kevin Schulman, M.D., M.B.A., and a list of select publications, please visit his faculty webpage.
New HCFO Findings Brief
HCFO Findings Brief - Bridging the Gap: The Role of Individual Health Insurance Coverage
New research findings emanating from a HCFO-sponsored project identify patterns of individual health insurance coverage. Researchers Andrew F. Coburn, Ph.D, and Erika Ziller at the University of Southern Maine and Timothy McBride at St. Louis University studied the coverage duration of the individually insured, the sources of coverage available before and after enrollment in an individual health plan, and the characteristics of those who rely on individual insurance coverage. They found that most individual insurance “spells” were characterized by people entering and exiting employer-based coverage, implying that individual health insurance was used primarily to bridge gaps in employer-based coverage. However, an important minority of the individually insured maintained coverage for more than two years, with small business employees and the self-employed having the longest spells.
New HCFO Grants Awarded
New HCFO Grants Awarded
HCFO funded eight new interesting projects that began work on February 1, 2006. For details on each of these grants, visit HCFO’s Grants webpage.
Spotlight on Grantee Publication
Spotlight on Grantee Publication
Steven D. Pizer, Ph.D., a health economist at the Veterans Affairs (VA) Boston Health Care System and assistant professor of health services at the Boston University School of Public Health, is the co-author of an article that appeared in the August 23, 2005 Web Exclusive issue of Health Affairs, titled “Defective Design: Regional Competition in Medicare.” The article details HCFO-sponsored research, which examined the competitive bidding process in Medicare Advantage under the Medicare Prescription Drug, Improvement, and Modernization Act of 2003.
Current HCFO grantee publications and recent grant findings will be regularly featured in the results section of our Web site.
Two New Resources for State Coverage Information
Two New Resources for State Coverage Information
Discover statecoverage.net
The Robert Wood Johnson Foundation’s (RWJF) State Coverage Initiatives (SCI) program, housed at AcademyHealth, recently added new resources to its Web site, statecoverage.net, to help states better navigate options for expanding health insurance coverage.
One of the most significant improvements is the state coverage matrix, which now provides at-a-glance comparisons and in-depth descriptions of coverage strategies such as Medicaid and SCHIP waivers, reinsurance, high-risk pools, limited-benefit plans, and group purchasing arrangements. Also included in the matrix are coverage profiles of each state, which offer useful statistics on sources of health insurance coverage and an overview of Medicaid and SCHIP coverage within each state, as well as descriptions and analyses of initiatives that states have implemented to expand or sustain coverage.
Visit statecoverage.net today to learn more about SCI and how its resources can help your state expand coverage.
State of the States Report on Health Coverage Expansion Initiatives
The State Coverage Initiatives (SCI) annual year-in-review report that tracks state progress to expand health insurance coverage is now available! State of the States 2006: Finding Their Own Way looks at the innovative efforts states have made to expand coverage amidst growing health care costs and looks ahead to what challenges might arise in the coming year.
Key Findings:
* States are taking steps to expand coverage despite recurring challenges, such as a growing number of uninsured, escalating health care costs, and the lack of a national consensus on solutions for the uninsured.
* Many states are exploring new coverage strategies on their own – efforts to experiment and implement new programs are emerging as states’ fiscal crises start to improve.
* From public expansions to market-based strategies, state coverage efforts are as varied as their populations, fiscal status, and political environment.
* Several new state programs were implemented in 2005, which may provide lessons about the types of strategies that are able to expand coverage while maintaining support within their state.
About the Report:
State of the States is produced by SCI, a national initiative of RWJF administered by AcademyHealth.
Hard Copies:
Copies of the report are available by contacting Heather Smithco at 202.292.6700 or heather.smithco@academyhealth.org.
Online:
http://www.statecoverage.net/pdf/stateofstates2006.pdf
Upcoming Events
Upcoming Events
The National Institute on Drug Abuse (NIDA), the National Institute on Mental Health (NIMH), and the Agency for Healthcare Research and Quality (AHRQ) will host a workshop titled, Grantsmanship in Health Services Research to be held on March 13-14 in Rockville, Md.
This one and a half day workshop will better prepare attendees to apply for health services research grants from the National Institutes of Health (NIH) and AHRQ. The meeting will address two objectives:
Day One (1-4:30 p.m.): Helping potential applicants refine research concepts.
Day Two (8:30 a.m.-4:30 p.m.): Providing information about the application and review processes.
People who do not seek more information about the application and review processes may forgo participation in the second day. Those interested in attending the second day are encouraged to participate on both days, even if they are not yet interested in developing a specific research project, as the presentations and discussions of research concepts will be informative.
If you want to discuss a specific research concept during the first day of the workshop, you must submit a brief description of the proposed research study.
Registration is free, but required. Please visit the workshop website for additional information, guidelines for concept paper development, and on-line registration please.
Please share this information with any colleagues who may be considering applying for an NIH or AHRQ grant in health services research.