www.jhsph.edu/dept/hpm/degrees/mha Management Rounds Johns Hopkins Master of Health Administration Program Johns Hopkins Bloomberg School of Public Health Department of Health Policy and Management August 2013 Director’s message Implementing Health Care Reform in Maryland: First Steps elcome to the August 2013 edition of Management Rounds. uch of the historic 2010 already had these high-risk pools and create WOur big news is that on June 1 Affordable Care Act (ACA) programs in the roughly one-third of states Bill Ward stepped down after 17 years centers on reforming the ways that lacked them prior to the ACA. MHIP as program director. I will be stepping in M in which individuals and small businesses was created in 2002 with funding from as the interim program director until we complete the search obtain private health insurance coverage. an assessment on hospital fees under the for Bill’s replacement. Moreover, much of the state’s all-payer rate-setting In addition, Doug implementation of the various mechanism. MHIP contracts Hough, PhD, from private insurance reforms with local insurance plan the JH Carey Business relies heavily on the states. CareFirst to help administer School, has joined our Several of Health Policy the program. program as associate and Management’s faculty “Interestingly, my fellow director. Our program continues its commitment affiliated with the MHA MHIP board members to stay abreast of the dynamic health program have been working and I initially figured our care environment through changes to with the state of Maryland on service would come to a our curriculum and activities. To help us these implementation efforts. close in December 2013,” along, this issue’s cover story from Brad Dr. Bradley Herring is Bradley Herring says Herring. Banning the Herring, HPM’s associate chair for Academic an associate professor of use of pre-existing health Programs, is about Maryland’s state-funded Health Economics in HPM who currently conditions by private insurers in January high-risk pool for medically uninsurable serves as chair of the board of directors for 2014 means that there technically won’t be residents and the challenges it faces. Our Management Rounds interview features the Maryland Health Insurance Plan and anyone who’s medically uninsurable. “But David Chin, MD, MBA, former senior partner recently was a co-chair of the state’s Small as we considered the matter more carefully, with PricewaterhouseCoopers, who is Business Health Options Program (SHOP) we realized that it might make sense to allow leading an executive education institute Exchange Advisory Committee. “One thing our current enrollees to stay in MHIP for a for transforming health systems to the that’s nice about this type of role for us while if they choose.” accountable care model. Dr. Chin discusses professors is that it’s a cool way for us to One of those considerations was how U.S. health care is changing and why he apply our research expertise to an issue that the difficulty the federal government is optimistic about the future. We also have serves the public,” says Herring. “But the encountered with the creation of the a number of other news items to report on, experience is also quite useful for us to apply including program updates. Medicare Part D drug benefit in 2006. As we prepare to welcome 25 members of in our classroom instruction,” he says. Switching low-income seniors’ supplemental the Class of 2015, we also wish you the best The Maryland Health Insurance Plan, coverage for drugs from state Medicaid for this coming year. or MHIP, is the state-funded “high-risk programs to a new federal Medicare benefit pool” for medically uninsurable residents led to some general confusion and specific administered by a small staff and overseen by problems with continuity of care. Ann-Michele Gundlach a nine-member board of directors. The ACA Another consideration was the impact on included funding to both bolster enrollment premiums brought about by transitioning in the roughly two-thirds of states that continued on page 9 Faculty Q & A MR: Should we, as some argue, let the U.S. coming in to see me. It incentivizes me to health care system collapse and rebuild it go looking for patients [with] whom I can from scratch? intervene earlier and reduce their costs. It also incentivizes me to use services more DC: That’s the Alcoholics Anonymous model, cost-effectively for those patients who do right? You’ve got to crash and burn first. And come and see me. then you’ll be willing to change. I think the system is too big to ever want that to happen. MR: How does this affect physicians? Too many people would get hurt. Until this point, the pain hasn’t been great enough in DC: Not only is it a different reimbursement terms of cost to really drive change. But I model, it’s a different mindset. Physicians think we’re getting there, at 18 percent of aren’t classically equipped to deal with David Chin, MD, MBA GDP. Since the states cannot run deficits and thinking about population health, number they are on the hook for ever-increasing retiree one. But also, number two, [there is] the Distinguished Scholar health and benefits costs, they must come up notion of practicing in teams, like a patient- with creative solutions. Otherwise, they go centered medical home. Many medical avid Chin, a former senior bankrupt. They have the most motivation to schools don’t have a curriculum around national partner with find a solution. That’s why I think the states what’s the role of a physician inside a system DPricewaterhouseCoopers, joined will lead with innovation. I can imagine that of care. Classically, that’s a public health the Department of Health Policy and … different states will come up with some kind of discipline. I think that’s another Management last year as a Bloomberg model that will work, and then we’ll say, OK, potential source of discomfort for the docs. School Distinguished Scholar. In this role, if it works there, then we’re willing to adopt it Not only is the money, the reimbursement Chin is leading an executive education nationally. thing, different, but now you’re moving into program for transforming health systems an area where you’re no longer the expert. to the accountable care model. The first MR: Is fee-for-service really going away? cohort of doctors, nurses, managers and MR: Are ACOs something that physicians DC: It’s funny. I think fee-for-service will be pharmacists is from Johns Hopkins Health welcome or dread? always with us, but maybe moderated some. System and is learning from a similarly You could make the argument that you DC: I suspect you probably know the diverse group of educators from the schools might pay primary care physicians fee-for- answer to that question. Most doctors grew of Public Health, Medicine, Nursing service so you incentivize them to bring in up under fee-for-service, and that’s worked and Business. Their goal: to lead ACO patients at the primary-care level, but then very well. Whenever you start changing transformation. According to Chin, seismic you might put specialists on some kind of the rules, particularly about money, people changes in health care will soon be apparent global payment so there is an incentive for get kind of upset. But people do know that to all. When the dust settles, he sees the fee- them to be more cost-effective. the current trajectory is not sustainable. for-service model becoming a much smaller Physicians are rapidly offering themselves up part of the landscape. Soaring health care MR: How are ACOs incentivized to keep for employment with hospitals and health costs and estimates that 20–50 percent of their population healthy? systems trying to get shelter. They can see these expenditures are wasted have made the handwriting on the wall that the fee- change essential. ACOs will challenge the DC: [As a physician] in the current fee- for-service model is broken and that the fee-for-service model as they are basically for-service system, I only get paid if the inexorable rise in fees is no longer inexorable. networks of hospitals and doctors that are patient comes in to see me. I do not get continued on page 3 rewarded for keeping patients healthy. paid to keep a patient healthy or to keep a Management Rounds wasn’t the only patient out of the system. The more I do, Bloomberg School publication interested in the more I make. Under an ACO model, hearing from Chin about his take on how I’m given almost a lump sum, a set amount U.S. health care is changing. Johns Hopkins of budget to take care of a population. And Mangement Rounds is published by the Public Health, the School’s magazine, I know that a certain proportion of patients Department of Health Policy and Management, interviewed Chin in its Spring 2013 issue to who are very, very sick and could use a lot Johns Hopkins Bloomberg School of Public Health. learn why he is optimistic about the future. of expensive therapy and inpatient days Editors: Teresa Schwartz, Jamila Savage Following is an excerpt from that interview. the next year aren’t necessarily the patients Designer: Doug Behr 2 Faculty Q & A MR: Are you optimistic about U.S. health DC: “Accountable care” really means a care? structure and a set of incentives to care continued from page 2 for a population of people. To do that, DC: Yeah.