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New study raises questions about focus on biggest users to reduce health costs

Any strategy to reduce health care costs must include access to affordable housing and increases in the minimum wage

Image courtesy of New York Times website

A new study published by the New England Journal of Medicine has raised questions about the efficacy of attempting to focus on the patients who need the most care as a way of reducing health costs. Image is of New York Times story posted online about the study.

By Louis Giancola
Posted 1/13/20
The theory of focusing on reducing the costs from the biggest users of health care services was challenged in a new study, a randomized, controlled trial, published in the New England Journal of Medicine.
Will dedicated state funding for Health Equity Zones be included in Gov. Raimondo’s proposed budget for 2020? Will the results of the new study change the strategies being deployed by the state’s Medicaid office in its accountable entity initiative? Which hospital system in Rhode Island will follow the lead of UnitedHealthcare in Phoenix and develop housing for the homeless population as a way to reduce health costs? What is the role that community development corporations can play in developing new housing starts in Rhode Island? How does the community get to participate in the decisions around health care needs, so that it becomes more of a bottom-up process?
Asthma is the leading cause of chronic school absenteeism in Providence. Some 71 percent of those being treated for asthma are enrolled in Medicaid, according to R.I. Department of Health data. The root causes of asthma are linked to poor housing conditions, including mold, rodent and insect excrement, and lead paint exposure. Many students and teachers in the Providence school system have complained about sick school buildings, saying anecdotally that their asthma is related to poor conditions in the schools. The other major cause of asthma is air pollution from highway traffic.
To improve education outcomes, and to improve health outcomes and reduce health costs, preventing asthma needs to become a major focus of future economic development investments in the state.

PROVIDENCE – The recent publication of “Health Care Hotspotting – A Randomized, Controlled Trial” in the New England Journal of Medicine will disappoint many health care professionals seeking ways to reduce health care costs.

It has long been known that 1 percent of the population is responsible for 25 percent of health care expenditures – and 5 percent of the population for 50 percent. For some time now health insurers and providers have been looking for strategies to reduce the consumption of services to reduce costs.

A modest 2 or 3 percent reduction for high-cost patients would be calculated to have a noticeable impact on the overall costs of health care.

The “Hotspotting” article examined the readmission rates of a matched group of patients discharged from hospitals in Camden, N.J,, half of which received extensive follow-up and access to social services and the other half received standard post-discharge care.

The article describes the intervention in some detail and included a home visit by a nurse within five days of discharge and a provider visit within seven days and access to an array of social services. The authors note that they could not measure the post-discharge services received by the non-intervention group.

It is important to note that the patients in both groups were at very high risk, based on their socio-economic circumstances. Some 75 percent of the patients were unmarried [being married is generally linked to better physical and mental health], 50 percent had no high school diploma, 95 percent were unemployed and 40 percent had a substance abuse diagnosis. [Interestingly, patients admitted for a psychiatric disorder were excluded from the study.] Camden, where the patients were hospitalized, is a very poor city and the patients in this study were extremely poor. More about the patient population later.

Disappointing findings

The disappointing finding of the study was that patients who received the intervention had the same rate of re-hospitalization over the six months following their first admission as those who received no intervention.

It was so disappointing that the New York Times ran a story about the study with the headline, “Deflating Results of Big Study.” Like all studies of this nature, it had its weaknesses. For example, the study did not track the services received by the control group.

Prodded by the Centers for Medicare and Medicaid Services, hospitals have improved the management transition of patients from acute hospital stays to home or other levels of care for all patients.

It’s possible that the “non-intervention” group received comparable assistance post discharge. The article also notes that not all patients in the intervention group received the home visit and follow-up provider visit in the prescribed time period.

There are many reasons for the protocol not being followed precisely, but the point is that the intervention may simply not have been carried out effectively. The material published does not provide the reasons for readmission and whether they could have been avoided, so we don’t know if modifications to the protocol could have made a difference.

Patient population
But let’s return to the patient population that was studied. It is very clear from the demographic information that the people in this study suffered from all the physical and mental health issues that result from abject poverty. As everyone knows, poverty and its impact on lifestyle are really bad for your health and well-being. The reality is that our country is not dealing with the root causes, which results in patients requiring multiple hospital admissions.

That doesn’t mean we don’t continue to work on better ways of managing the health of patients like those in the study. No one wants to be living their life from hospital stay to hospital stay. But it does mean that we have to provide people with the necessary support to lead healthy lives.

That’s a long process, but we have to pivot to greater investments in affordable housing, education and nutrition that allow individuals to lead healthy and productive lives. We also have to end institutional racism that harms the souls of many people and blocks access to those things necessary for a healthy life.

Dr. Brenner, the founder of the Camden Project who now works for UnitedHealthcare, seems to recognize that more radical approaches are necessary. He is credited with UnitedHealthcare investing in housing units in Phoenix, Ariz., to ensure that patients like those in the study have a safe and healthy place to live post-discharge.

In Rhode Island, the state’s Department of Health has funded organizations to address the disparities in health outcomes in disadvantaged communities, Health Equity Zones, or HEZ.

The agency has relied on federal funds and public foundations to support their efforts. This funding has created the necessary infrastructure, but without investment in housing and education, and policy changes necessary to make improvements in those areas, the disparities will persist.

In Rhode Island, and across the nation, we’re on the horns of a dilemma. We’re finding it hard to afford the health care that we consume now. We know that the long-term solution is to produce a healthier population that consumes less health services, and more importantly, enjoys a better life.

But where does the money come from to provide everyone with a living wage, to make appropriate housing available to everyone and to educate everyone so they can earn a decent wage?

Clearly, we have to chip away at health care cost which represent 20 percent of our economy. The experts say that 30 percent of health care is waste, but it seems to be taking a long time to find that pot of gold.

Increasing the minimum wage
One strategy that doesn’t receive enough attention is to increase the minimum wage. Some studies are demonstrating that a one-dollar increase in the minimum wage actually results in a longer life for those living at or near the poverty line. Another important strategy is to ensure safe and affordable housing, preferably in mixed income neighborhoods, to reduce the social isolation of low-income housing complexes.

While we continue to look for ways to lower health care costs, we need to face up to the underlying issues that have created an unhealthy population, particularly for the poor.

Louis Giancola, the former president and CEO of South County Health, is a frequent contributor to ConvergenceRI.

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