Breaking News
May 3, 2019 - Vaping and Smoking May Signal Greater Motivation to Quit
May 3, 2019 - Dementia looks different in brains of Hispanics
May 3, 2019 - Short-Staffed Nursing Homes See Drop In Medicare Ratings
May 3, 2019 - Study of teens with eating disorders explores how substance users differ from non-substance users
May 3, 2019 - Scientists develop new video game that may help in the study of Alzheimer’s
May 3, 2019 - Arc Bio introduces Galileo Pathogen Solution product line at ASM Clinical Virology Symposium
May 3, 2019 - Cornell University study uncovers relationship between starch digestion gene and gut bacteria
May 3, 2019 - How to Safely Use Glucose Meters and Test Strips for Diabetes
May 3, 2019 - Anti-inflammatory drugs ineffective for prevention of Alzheimer’s disease
May 3, 2019 - Study tracks Pennsylvania’s oil and gas waste-disposal practices
May 3, 2019 - Creating a better radiation diagnostic test for astronauts
May 3, 2019 - Vegans are often deficient in these four nutrients
May 3, 2019 - PPDC announces seed grants to develop medical devices for children
May 3, 2019 - Study maps out the frequency and impact of water polo head injuries
May 3, 2019 - Research on Reddit identifies risks associated with unproven treatments for opioid addiction
May 3, 2019 - Good smells may help ease tobacco cravings
May 3, 2019 - Medical financial hardship found to be very common among people in the United States
May 3, 2019 - Researchers develop multimodal system for personalized post-stroke rehabilitation
May 3, 2019 - Study shows significant mortality benefit with CABG over percutaneous coronary intervention
May 3, 2019 - Will gene-editing of human embryos ever be justifiable?
May 3, 2019 - FDA Approves Dengvaxia (dengue vaccine) for the Prevention of Dengue Disease in Endemic Regions
May 3, 2019 - Why Tonsillitis Keeps Coming Back
May 3, 2019 - Fighting the opioid epidemic with data
May 3, 2019 - Maggot sausages may soon be a reality
May 3, 2019 - Deletion of ATDC gene prevents development of pancreatic cancer in mice
May 2, 2019 - Targeted Therapy Promising for Rare Hematologic Cancer
May 2, 2019 - Alzheimer’s disease is a ‘double-prion disorder,’ study shows
May 2, 2019 - Reservoir bugs: How one bacterial menace makes its home in the human stomach
May 2, 2019 - Clinical, Admin Staff From Cardiology Get Sneak Peek at Epic
May 2, 2019 - Depression increases hospital use and mortality in children
May 2, 2019 - Vicon and NOC support CURE International to create first gait lab in Ethiopia
May 2, 2019 - Researchers use 3D printer to make paper organs
May 2, 2019 - Viral infection in utero associated with behavioral abnormalities in offspring
May 2, 2019 - U.S. Teen Opioid Deaths Soaring
May 2, 2019 - Opioid distribution data should be public
May 2, 2019 - In the Spotlight: “I’m learning every single day”
May 2, 2019 - 2019 Schaefer Scholars Announced
May 2, 2019 - Podcast: KHN’s ‘What The Health?’ Bye-Bye, ACA, And Hello ‘Medicare-For-All’?
May 2, 2019 - Study describes new viral molecular evasion mechanism used by cytomegalovirus
May 2, 2019 - SLU study suggests a more equitable way for Medicare reimbursement
May 2, 2019 - Scientists discover first gene involved in lower urinary tract obstruction
May 2, 2019 - Researchers identify 34 genes associated with increased risk of ovarian cancer
May 2, 2019 - Many low-income infants receive formula in the first few days of life, finds study
May 2, 2019 - Global study finds high success rate for hip and knee replacements
May 2, 2019 - Taking depression seriously: What is it?
May 2, 2019 - With Head Injuries Mounting, Will Cities Put Their Feet Down On E-Scooters?
May 2, 2019 - Scientists develop small fluorophores for tracking metabolites in living cells
May 2, 2019 - Study casts new light into how mothers’ and babies’ genes influence birth weight
May 2, 2019 - Researchers uncover new brain mechanisms regulating body weight
May 2, 2019 - Organ-on-chip systems offered to Asia-Pacific regions by Sydney’s AXT
May 2, 2019 - Adoption of new rules drops readmission penalties against safety net hospitals
May 2, 2019 - Kids and teens who consume zero-calorie sweetened beverages do not save calories
May 2, 2019 - Improved procedure for cancer-related erectile dysfunction
May 2, 2019 - Hormone may improve social behavior in autism
May 2, 2019 - Alzheimer’s disease may be caused by infectious proteins called prions
May 2, 2019 - Even Doctors Can’t Navigate Our ‘Broken Health Care System’
May 2, 2019 - Study looks at the impact on criminal persistence of head injuries
May 2, 2019 - Honey ‘as high in sugars as table sugar’
May 2, 2019 - Innovations to U.S. food system could help consumers in choosing healthy foods
May 2, 2019 - FDA Approves Mavyret (glecaprevir and pibrentasvir) as First Treatment for All Genotypes of Hepatitis C in Pediatric Patients
May 2, 2019 - Women underreport prevalence and intensity of their own snoring
May 2, 2019 - Concussion summit focuses on science behind brain injury
May 2, 2019 - Booker’s Argument For Environmental Justice Stays Within The Lines
May 2, 2019 - Cornell research explains increased metastatic cancer risk in diabetics
May 2, 2019 - Mount Sinai study provides fresh insights into cellular pathways that cause cancer
May 2, 2019 - Researchers to study link between prenatal pesticide exposures and childhood ADHD
May 2, 2019 - CoGEN Congress 2019: Speakers’ overviews
May 2, 2019 - A new strategy for managing diabetic macular edema in people with good vision
May 2, 2019 - Sagent Pharmaceuticals Issues Voluntary Nationwide Recall of Ketorolac Tromethamine Injection, USP, 60mg/2mL (30mg per mL) Due to Lack of Sterility Assurance
May 2, 2019 - Screen time associated with behavioral problems in preschoolers
May 2, 2019 - Hormone reduces social impairment in kids with autism | News Center
May 2, 2019 - Researchers synthesize peroxidase-mimicking nanozyme with low cost and superior catalytic activity
May 2, 2019 - Study results of a potential drug to treat Type 2 diabetes in children announced
May 2, 2019 - Multigene test helps doctors to make effective treatment decisions for breast cancer patients
May 2, 2019 - UNC School of Medicine initiative providing unique care to dementia patients
May 2, 2019 - Nestlé Health Science and VHP join forces to launch innovative COPES program for cancer patients
May 2, 2019 - Study examines how our brain generates consciousness and loses it during anesthesia
May 2, 2019 - Transition Support Program May Aid Young Adults With Type 1 Diabetes
May 2, 2019 - Study shows how neutrophils exacerbate atherosclerosis by inducing smooth muscle-cell death
May 2, 2019 - Research reveals complexity of how we make decisions
Medicare Advantage plans shift their financial risk to doctors

Medicare Advantage plans shift their financial risk to doctors

Dr. Christopher Rao jumped out of his office chair. He’d just learned an elderly patient at high risk of falling was resisting his advice to go to an inpatient rehabilitation facility following a hip fracture.

He strode into the exam room where Priscilla Finamore was crying about having to leave her home and husband, Freddy.

“Look, I would feel the same way if I was you and did not want to go to a nursing home, to a strange place,” Rao told her in September, holding her hand. “But the reality is, if you slip at home even a little, it could end up in a bad, bad way.”

After a few minutes of coaxing, Finamore, 89, relented and agreed to go into rehab.

Keeping patients healthy and out of the hospital is a goal for any physician. For Rao, a family doctor in this retiree-rich city 100 miles north of Miami, it’s also a wise financial strategy.

Rao works for WellMed, a physician-management company whose doctors treat more than 350,000 Medicare patients at primary care clinics in Florida and Texas. Instead of being reimbursed for each patient visit, WellMed gets a fixed monthly payment from private Medicare Advantage plans to cover virtually all of their members’ health needs, including drugs and physician, hospital, mental health and rehabilitation services.

If they can stay under budget, the physician companies profit. If not, they lose money.

This model — known as “full-risk” or “global risk” — is increasingly used by Medicare plans such as Humana and UnitedHealthcare to shift their financial exposure from costly patients to WellMed and other physician-management companies. It gives the doctors’ groups more money upfront and control over patient care.

As a result, they go to extraordinary lengths to keep their members healthy and avoid expensive hospital stays.

WellMed, along with similar fast-growing companies such as Miami-based ChenMed, Boston-based Iora Health and Chicago-based Oak Street Health, say they provide patients significantly more time with their doctors, same-day or next-day appointments and health coaches. These doctors generally work on salary.

ChenMed doctors encourage their Medicare patients to visit their clinic every month — for no charge and with free door-to-door transportation — to stay on top of preventive care and better manage chronic conditions. If patients are not feeling well after-hours, ChenMed even will send a paramedic to their home.

“We can be much more creative in how we meet patient needs,” said Iora CEO Rushika Fernandopulle. “By taking risk, we never have to ask … ‘Do we get paid for this or not?'”

A Way To ‘Provide Less Care’

Some patient advocates, pointing to similar experiments that failed in the 1990s, fear “global risk” could lead doctors to skimp on care — particularly for expensive services such as CT tests and surgical procedures.

“At the end of the day, this is a way to keep costs down and provide less care,” said Judith Stein, executive director of the Center for Medicare Advocacy.

Dr. Brant Mittler, a Texas cardiologist and trial attorney who has followed the issue, said Medicare Advantage members should be suspicious.

“Patients don’t know that decisions made on their behalf are often financially based. There may be pressure on doctors to cut corners to save money and that may not be in the best interests of a patient’s health,” he said.

The insurers and physician groups disagree. They said limiting necessary care would only exacerbate a patient’s health problems and cost the doctors’ group more money.

Noting that Medicare members stay with Humana an average of eight years, Roy Beveridge, the insurer’s chief medical officer, said the plan would be unwise to skimp on care because that would eventually leave the company with sicker patients and longer hospitalizations.

“It makes even less sense for physicians at financial risk to skimp on care because patients are typically with their physicians much longer than they are with a health plan,” he said.

A study that examined care at ChenMed, published last month in the American Journal of Managed Care, found health costs were 28 percent lower among patients who had more than double the number of typical visits with their primary physician. The study was conducted by researchers at ChenMed and the University of Miami.

To offer more personal care, ChenMed doctors typically see only about a dozen patients per day — about half as many as is usual for a doctor who gets paid for each individual service.

Medicare beneficiaries, who can choose a private health plan during the open-enrollment period that runs from Oct. 15 to Dec. 7, generally have no idea if their health plan has ceded control of their care to these large doctors’ groups.

After choosing a Medicare Advantage plan, they generally sign up for a medical group that is part of their health plan’s network, often because doctors are close to where they live or because the doctors offer extra benefits such as free transportation to appointments.

Eloy Gonzalez, 71, of Miami, said that before switching to ChenMed a couple of years ago his doctors always seemed to be in a hurry when he saw them. He’s happy with his ChenMed physicians.

On a recent visit, he spent nearly 20 minutes with Dr. Juana Sofia Recabarren-Velarde talking about keeping his blood pressure and lung condition under control. She also showed him exercises to manage back and shoulder pain.

“If she thinks she needs to see me once a month to monitor my blood pressure and see if anything else is happening, it’s OK with me,” said Gonzalez, who pays nothing for the office visits or generic drugs under his Humana Medicare Advantage plan with ChenMed.

A Growth Spurt

Nearly one-third of the 57 million Medicare beneficiaries are covered by private Medicare Advantage plans — an alternative to government-run Medicare — and federal officials have estimated that the proportion will rise to 41 percent over the next decade. The government pays these plans to provide medical services to their members.

The “global risk” system has been used in South Florida and Southern California since the late 1990s and nearly half of Medicare Advantage members in those regions get care in the model. The use has spread further in the past two years as large physician companies have become more common, and about 10 percent of Medicare Advantage plan members across the nation are in them now, health consultants say.

In addition, new information technology allows these groups to better track their patients. With mixed results, Medicare Advantage insurers for years offered doctors bonuses to meet certain quality care standards, such as getting members vaccinated against the flu or controlling diabetes and other chronic diseases.

Under the “global risk” arrangements, the health plans give the physician companies the bulk of their Medicare funding when they take on the mantle of being financially responsible for all patient care.

For the doctors’ groups, the arrangement means they get paid a large amount of money upfront for patient care and don’t have to worry about billing or having to get insurers to always preapprove treatments.

Because the “global risk” arrangements are designed to reduce plans’ costs, they potentially allow the companies to lower premiums and attract more customers, said Mark Fendrick, director of the University of Michigan’s Center for Value-Based Insurance Design.

“I see this trend continuing to grow as clinicians will be accountable for the first time for the care they provide,” he said.

Historical Lessons

But Ana Gupte, a securities analyst with Leerink Partners in New York, noted providers can also lose money if not successful.

That’s what happened in the late 1990s when some physician-management companies such as FPA Medical Management and PhyMatrix took on financial risk from insurers only to later go bankrupt, interrupting care to thousands of patients.

Health insurers say they now trust only doctors’ groups that have shown they can handle the financial risk. They also retain varying levels of control. Insurers set benefits, handle member complaints and review which doctors are allowed in its network.

Martin Graf, a partner with consulting firm Oliver Wyman, said the old financial arrangements failed because provider groups did not manage the risks facing their patients.

“Now they know physician groups must be vigilant about their patients — whether they are in the office or not,” he said. “Everyone is aware of the failure of the past.”

KHN’s coverage of these topics is supported by John A. Hartford Foundation and The SCAN Foundation

Kaiser Health NewsThis article was reprinted from khn.org with permission from the Henry J. Kaiser Family Foundation. Kaiser Health News, an editorially independent news service, is a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization unaffiliated with Kaiser Permanente.

Tagged with:

About author

Related Articles