Sean Cavanaugh, Deputy Administrator for the Centers for Medicare and Medicaid Services

Mark Masselli: This is Conversations on Health Care. I a m Mark Masselli.

Margaret Flinter: And I a m Margaret Flinter.

Mark Masselli: Well , Margaret, some interesting new recommendations coming
out of The White House Conference on aging. The group which convenes once
every 10 years has issued new rules governing nursing home care.

Margaret Flinter: So perhaps the most notable change has to do with the
proliferation of the use of electronic health records Mark, which were barely in
use a decade ago . Now they have a chance to collect meaningful data on
patient care in nursing homes and the new rules aim to facilitate better sharing of
that data, and also considerable scientific evidence against the overuse of
antipsychotic drugs in older patients al ong with the overuse of antibiotics.

Mark Masselli: The new rules allow for nursing home patients to be able to
choose their room mates if at all possible including same sex couples, siblings
and long time friends. The idea is that families and near lov ed ones, should be
free to exercise personal choice in these care facilities.

Margaret Flinter: There are concerns from some advocacy groups that the new
rules aren’t doing enough to address the shortage of nurses in nursing home and
long term care facilities and the sheer volume of care can overwhelm nursing
staff that is caring for often very complex needs of elderly patients including
dementia.

Mark Masselli: And there has been another dramatic shift in recent weeks
Margaret, The Center for Medi care and Medicaid has recently announced an
agreement with the American Medical Association that would allow for end of life
care discussions to be encouraged between patients and providers. This
conversation is one that we believe is long overdue. It sh ould be more common
protocol that is encouraged.

Margaret Flinter: And CMS is looking to improve the way care is delivered and
the way it is paid for and this is something that our guest today knows quite a bit
about.

Mark Masselli: Sean Cavanaugh is D eputy Administrator and Director of the
center for Medicare at the center for Medicare and Medicaid services.

Margaret Flinter: And Lori Robertson will be stopping by, the managing editor of
Factcheck.org. She is always on the hunt for misstatements spo ken about health
policy in the public domain.

Mark Masselli: But no matter what the topic you can hear all of our shows by
going to chcradio.com and it’s always if you have comments please e - mail us at

CHCRadio@ chc1.com or find us on and as always , if you have comments , email
us a t Chcradio.com or find us on Facebook or Twitter , we would love hearing
from you.

Margaret Flinter: We will get to our interview with Sean Cavanaugh in just a
moment.

Mark Masselli: But first , here is our producer Maria n n e O’ Hare with this week ’ s
Headlines News.

Marianne O’Hare: I am Marianne O’Hare with these health care headlines . The
recent Supreme Court decision up holding of a gallery of tax subsidies for
residents in all states to offset the cost of insurance purchase has let to an
interesting phenomenon. Some states that set up exchanges of their own are
now focussing on the p ossibility of a Federal Market Place as an opt out. At least
3 states with their own market places, Minnesota, Vermont and Hawaii have
taken steps to switch to The Federal System after their own market places were
too much of a financial technical and adm inistrative burden. The court’s ruling
means they can make that move without disqualifying their residents for
subsidies. The White House Council on Aging has issued new guidelines for
treating the growing population of America’s elderly recommendations were
made they would incentivise long term care facilities and nursing homes to
provide better living environments for residents, better training in dementia
treatment and handling and better use of electronic health data to keep the
elderly from frequent admissions. Type 2 diabetes is expected to affect about 75
million Americans by 2 - 30 and scientist at The University of North Carolina have
come up with a much more user friendly tool to keep insulin levels constant.
Apparently some 21 million Americans m ust rely on daily injections or a pump to
stabilize insulin; researchers in this study have created a simple patch worn on
top of the skin, which releases insulin when it detects a fluctuation and looking to
do human trials soon. I am Marianne O’Hare with these health care headlines .

Mark Masselli: We are speaking today with Sean Cavanaugh, Deputy
Administrator and Director of The Center for Medicare at The Center for
Medicare and Medicaid Services or CMS which is responsible for overseeing
regulation an d payment of Medicare fee for service private Medicare plans and
prescription drug programs. Part of that Mr. Cavanaugh oversaw the
development of new payment and service delivery modals as deputy director at
the center for Medicare and Medicaid innovatio n. Previously Mr. Cavanaugh was
Director of Healthcare Finance at the United Hospital Fund and also served in
senior positions at Lutheran and Healthcare in Brooklyn, New York as well as the
New York City ’s Mayor’s Office of Health Insurance. He earned degrees from
the University of Pennsylvania and Jones Hopkins School of Hygiene and public
health. Mr. Cavanaugh, welcome to Conversations on Health Care.

Sean Cavanaugh: Thanks of having me.

Mark Masse lli: Well first of all Happy Birthday. CMS is 50 years old this month
and I can’t think of any organization that has had such a profound impact on the
millions of lives all across America. So you almost, hopefully you are getting little
break to celebra te.

Sean Cavanaugh: There are number of celebrations and some assessment of
where we have been over the last 50 years and where we are headed. As you
said, it’s a really terrific history in this program and we’re planning for a similar
future.

Mark Mas selli: The center has also been focusing on innovation and programs
as CMS in a way which you are in charge of the idea allowed at the Department
of health and human services particularly and many others, can you describe for
our listeners that these diff erent programs and what are some of the distinct
features as well as how their efforts either can’t.

Sean Cavanaugh: A couple of themes have emerged. One is we are really
trying to create a variety of pathways to meet the needs of providers. So there i s
a wide variety of providers out there. So we are trying to create opportunities for
all of them to participate in new modals and find ways to improve care. There is
also a wide spectrum of where providers are on their ability to transform. Some
are le ading edge organizations that have been moving to new modals of care for
many years and there are others, particularly smaller practices that are just
starting to understand areas where they could improve. So we are trying to
make sure we can meet the needs of all of them and the work really falls in the 3
categories. One is to create an expectation for improvement so a lot of public
reporting about how people are doing on preventing infections and other adverse
consequences of healthcare. The second is creating business cases for
improvement, so making sure when providers do the things we want them to do
and improve the care that they are rewarded under our payment systems and
then finally making sure providers have the tools they need for improvement. So
we, a couple of months ago and now something called transforming clinical
practice. This majo r investment we are going to make n reaching out in reaching
out to small practices around the country trying to find out what their needs are,
data needs, and infrastructure needs to improve how they provide care. So I
think, as you look across the Gover nment and see the different things we are
doing there, all fall into one of those buckets and they work together and
hopefully drive improvement.

Margaret Flinter: But I think all of you at CMS would probably are among to first
to say that you can’t do i t alone. That you are always operating in partnership
with others around the country and I am particularly being interested in this trend
of the interface between public and private entities as a partnership that spurs
innovation. Tell us a little bit ab out why these public and private partnerships are
so essential to progress right now?

Sean Cavanaugh : First and foremost are we all acknowledging particularly when
it comes to Health System Improvement that we don’t have all the answers here.
So I think we are reaching out to learn more from what’s happening with other
payers. Whether they are current full payers, what’s happening in the provider
community and how we can build upon those successes, probably the best
example of that is the innovation cen ter at CMS over the last couple of years has
twice solicited what we call healthcare innovation awards and this is where they
open the doors and say please send us your best ideas and we will fund your
project for 3 years, so that we can study and learn fr om it and see how it might
have lessons for it more broadly. You know we are a large payer for healthcare
services but we are certainly not the only payer and if we want to drive change
and drive improvement we see a value in working with other payer so t hat, you
know , a physician in his or her office isn’t getting 12 different reports from
different payers explaining the same thing in different ways, rewarding different
behaviors I think to agree, we can all agree on common matrix on what
improvement loo ks like, public private cooperation is supporting and that is
essential.

Mark Masselli: Sean prior to taking up your current at CMS, you were a Deputy
Director for Program and Policy at the Center for Medicare and Medicaid
Innovation. You came up with a nd have been focusing on the accountable care
organization and patient centered medical homes. May be you can tell all this
one is about the type or traction you have seen in some of these innovative
approaches and what hurdles also have you identified.

Sean Cavanaugh: We are very pleased to see that there is enormous appetite
and an enormous willingness among providers around the country to try
something different to improve care. You know, as much as people had criticized
pay for service medicine, it actually was working financially very well for many
providers. And yet we have seen providers step up and understand that pay for
service medicine often is not in the best interest of beneficiaries and patients.
One area where we tried a lot of thins is an accountable care organization
through the innovation center, we can use the pioneer ACO model which was for
organizations that were at the leading edge with care coordination and population
health management and the other was a program created by Congre ss called
The shared savings program. Between them we have over 400 ACOs providing
care to over 7 million Medicare beneficiaries around the country. The great news
here is on the quality front, both of those programs have the measurable
improvements in t he quality of care. They improved care from one year to the
next and in areas where there were common quality measures; they
outperformed pay for service providers. So already 7 million beneficiaries
receiving a higher le vel of care and if CMS actually h as recently issued a report
saying that the pioneer shows an addition to generating the quality improvement s
had also saved the Government over 380 million dollars over 2 years. Another
program that got a quick start and some great early results is called Independent

Sit Home. This is a program that is tailored specifically for the free list Medicare
beneficiaries who are living in home but have been in and out of hospital and
have multiple chronic diseases and physician groups around the country that
foc uses specifically on these populations and that provide a lot of care in the
home and so lot of home visiting. We have recently had a report coming out in
just one year and they saved over 3000 dollars per beneficiary for these folks
and improved care the y got and you are just can’t imagine with the home visiting,
the beneficiaries are very pleased with the care that they are getting. We also
see the secretary (inaudible 11:15 ) from health and human services. She
announced very specific goals for CMS to try to move Medicare towards these
new payment modals because the feeling really is that a lot of improvement can
be driven by payment so she has talked about making sure we get all of our
(inaudible 11:31 ) systems into value based designs meaning that the y are reward
improvements in qualities but also to start developing on these alternative
payment modals like the ACOs and the independents at home and this was
recently reinforced when Congress repealed the SGR formula. They also
created a scenario where they are trying to encourage us to create alternative
payment modal. So did you see more of this, a lot of openness and willingness
on the provider community to work in these environments?

Margaret Flinter: Well it’s not always the case and it’s not alw ays the case
dealing with some of the entrenched larger organizations we have seen this case
and point a bit of with the push back against adopting some new technologies,
how a cheap protocol certainly meaningful use is something that’s just even
recently in the (inaudible 12:14 ) a bit but in another area he has been the
adoption of the ICD10 medical billing codes, which The American Medical
Association and some other organizations have been pretty ardently opposed to.
We understand that CMS has come to so me kind of agreement with the AMA
st
and how to move forward with the October 1 deadline this year and make that
kind of 20 year overdue upgrade to the ICD10.

Sean Cavanaugh: What I have found is that when they come to us and are
concerned about some of t he changes we are proposing. It’s really important for
us to listen and understand where they are coming from and the AMA in
particular I think who has been a very strong advocate for the smaller physician
practices and so when they speak about the challe nges facing these practices
and others, we need to understand where they are coming from and see where
there is common ground, while the AMA still in fairness I think they have still
have some concerns about ICD10 by talking to them about how we would
impl ement it and transition in the coming year. We still need physicians to submit
valid ICD10 codes but we gave some reassurances that even if they can’t use
the most specific ICD10 code, if they are using the right family and are making a
good face effort t o comply, transitions are hard but as you said I think the move
to ICD10 is overdue, it’s time, we just have to work together to get through the
transition.

Mark Masselli: We are speaking today with Sean Cavanaugh, Deputy
Administrator and Director of The Center for Medicare at The Center for
Medicare and Medicaid Services. Sean you know, CMS has been releasing a
number of rules over, that have led to the sl owing down and it’s going down over
the cost of treating some 50 million American seniors on Medicare and could you
tell our listeners about some of the changes CMS has been recommending
concerning outpatient reimbursements, I think you were in the New Yor k times on
the front page on the telemedicine reimbursement, in home nursing care and end
of life care and other approaches to care deliver.

Sean Cavanaugh: Really on a per capita basis, the last few years have been
historic low grades of growth in Medicare costs. Low cost growth has allowed a
number of things, one of which is it allow Congress to make better policy, with a
lot of benefits to lower cost growth and I think --- It’s a good point --- As you know
we face the challenge of the (inaudible 14:35 ). We are going to have almost
50% growth in the enrollment in Medicare in the next 15 years and that’s why you
know, the secretary as I said announced that we are got to try to really move
aggressively to new payment modals and why I think congress endorsed that
with appealed the SGR, he mentioned specifically tele medicine, I think that’s an
area that has enormous potential and we are trying new modals in different areas
some you know, those are innovational words that I mentioned. We have a
number of providers showing how to Telemedicine can be used in innovative
ways and will be ruling it out in some of our ACO programs in the next year too
as well. So all these technologies, all these innovative ideas, we are going to be
testing many of them because we really have a significant challenge before us
with the aging of the (inaudible 15:23 ).

Margaret Flinter: I guess all of our conversations on insurance speaks to the
notion that changes hard but it’s inevitable and I would add to that and we would
like it best when it’s happening to somebody else that you should feel that too
ourselves but we see such changes happening across the healthcare spectrum
and not just at the Federal level but a the state level as well, so I would like to
talk a little bit about the state innovation modals or the SIM. 11 states are
receiving over 620 million dollars to test out their modals for how they are going
t o significantly change healthcare in a way that affects the vast majority of the
people in the state. What are some of the most interesting innovations that you
are seeing in the SIM so far?

Sean Cavanaugh: You know, Medicare at 550 billion dollars and growing plays
really large role in the health care system in the United States. When we look at
the states we see partners who have many tools themselves, they have policy
letter that we don’t have but that can help drive change. One they are a large
pai r themselves through Medicaid and also they have a long history in many of
these states with convening providers and working locally to define change and
drive change in a way that federal Government doesn’t have and you know, with
the affordable care act they are also operating in market places in some cases,

so they have a lot of ability to drive change and that the purpose of the state
innovation model is to recognize that and build on that momentum and really the
value add there is just that, it’s much as anything as the convening of bringing
people together and reaching consensus on what kind of change works for the
payers and providers. One of the exciting modals out of the states comes from
the State of Maryland. They have a long history in Maryland , somewhat unique
of hospital rate regulation and they came to us and wanted to modernize the way
they did it. They thought the modal that they were utilizing was developed in
1970s and they wanted to move toward a more modern approach that looked
more gl obally at hospital costs and they just finished a very successful year
where they generated savings at the Federal Government and improved on
some quality matrix, I don’t think a lot of states will want to go to that very storng
regulatory model but I ment ioned Maryland because it was a way of working with
the Federal Government that’s coming to us and they had a plan of what they
wanted to and I think, there is going to be a lot more percolating in the State
innovation models in the next year or too.

Mark Masselli: Sean there has been an enormous amount of capital being put
into hospitals and private practices converting the ARA put in billions of dollars so
that we can have this important and dramatic shift from paper records to
electronic health records and we have taken a mighty strides in the last year and
yet they are still work to be done in terms of interoperability and the health
information exchanges and part of the requirement is for practices and
organizations to attain meaningful use in health IT and we have seen some
practices struggle and there has been a struggle at stage 2 of meaningful use
requirements. With kinds of programs are being facilitated by CMS to expedite
the adoption of health IT and the ability to use data to effectively impr ove quality
of care and outcomes.

Mark Masselli: Okay I think you are right, which is we have all seen significant
strides being made in the use of health information technology but I think it’s
Universal, to believe that the potential of these technolog ies is still not fully
tapped that there is so much more that could be done particularly to make them
interpretable so that there is data sharing. We’ve tried to balance that in our
meaningful use regulations, all the same time understanding the struggles of
providers and vendors and keeping up with the change and making sure this
works in meaningful ways. One of the things the Federal Government can do is
some of the work we are doing that isn’t specifically about HIT to the degree that
we’ve reward care that really focusses on positive outcomes and efficiency
where implicitly creating a business case for practices to find out a way to make
this HIT work in a meaningful way. Not specifically through meaningful use but
also just trying to drive towards to the types of cares where interoperable HIIT is
indispensable.

Margaret Flinter: We’ve been speaking today with Sean Cavanaugh, Deputy
Administrator and Director of The Center Medicare at The Center for Medicare

and Medicaid Services. You can learn more about their work by going to
cms.innovate.gov. Sean thanks you so much for joining us on Conversations on
Healthcare today.

Sean Cavanaugh: Well thank you for having me. It’s been a great discussion.

Mark Masselli: At Conversations on Health Care, we want our audience to be
truly in the know when it comes to the facts about Healthcare Reform and policy.
Lori Robertson is an award - winning journalist and managing editor of
FactCheck.org, a nonpartisan, nonprofit consumer advocate for voters that aim to
reduce the level of deception in U . S . politics. Lori, what have you got for us this
week?

Lori Robertson: In the late June the Supreme Court ruled in favor of The Obama
Administration in a case challen ging the subsidies that are available through
federally run insurance market places. The reaction from both sides was swift
and in some cases misleading. President Obama said that the ACA made
healthcare “A right for all” but the law doesn’t achieve univ ersal coverage and it
was never expected to. The White House estimates that 16 million uninsured
have gained coverage under the law but that’s still leaves more than 30 million
uninsured and the Congressional Budget office estimates that in 2025, there st ill
will be 27 million uninsured. The law reduces the uninsured but it doesn’t cover
everybody. On The Republican side a day before the ruling senator Ted Cruise
claims that premiums had gone “through the roof” citing at 3000 dollar increase in
family em ployer plans since the law was enacted. The figure is correct but that’s
actually evidence of relatively low premium growth. Employer premium growth
has been slower since the law was enacted compared with the growth before.
Premiums have grown more slow ly under Obama then they did under President
George W. Bush. However, experts say the primary reason isn’t The Affordable
Care Act instead it’s the sluggish economy and that’s my fact check for this week
I am Lori Robertson, Managing Editor of factcheck.o rg.

Margaret Flinter: FactCheck.org is committed to factual accuracy from the
country's major political players and is a project of the Annenberg Public Policy
Center at the University of Pennsylvania. If you have a fact, that you would like
checked, e - mail us at Chcradio.com, w e will have FactCheck.org's Lori
Robertson check it out for you here on Conversations on Health Care.

Mark Masselli: Each week Conversations highlight s a bright idea about how to
make wellness a part of ou r communities and every day lives. Of the 6.6 million
births per year in this country over a half are unattended and among teens those
rates are even higher. Colorado has been conduction an experiment for several
years to examine what might happen if sexually active teens and p oor women
were offered the option of long term birth control such as IUDs or implants. The
first question to answer would they take the offer?

Larry Walk: What was so striking was the word of mouth amongst these young
women to each other and the networ k of support that was built amongst these
young women to access this program through these clinics to help the thousands
of women over the course of 4 to 5 years really did than result in the significant
decrease in unintended pregnancies and abortions.

Mark Masselli: Dr. Larry Walk is Medical Director of The Colorado Department of
Health and Environment. He says the results were nothing short of astounding.

Larry Walk: The result in decrease is 40% plus or minus in both categories,
pregnancy and abor tion over these 45 years and those reductions may be even
more dramatic when you extend this out over an additional year to more than 50
even approaching 60% reduction.

Mark Masselli: And the results showed not only a dramatic decrease in
unintended preg nancies there was a significant economic benefit to the state as
well.

Larry Walk: We’ve seen a significant decrease in the number of young moms
and kids applying for and needing public assistance whether that’s public
insurance whether that’s through th e WIT program.

Mark Masselli: And in spite of what conventional wisdom might lead one to
assume the incidents of sexually transmitted disease has dropped in this
population as well.

Larry Walk: Amongst young women 15 to 24, we have seen a decrease in
s exually transmitted infections.

Mark Masselli: Many other State Health Departments are already consulting with
Colorado on the successful outcome of their experiment. A fee long term
contraception program offered to at risk teens and women trying to avoid the
economic hardship of unplanned pregnancies leading to a number of positive
health and economic outcomes for all in volved, now that’s a bright idea.

Margaret Flinter: This is Conversations on Health Care. I am Margaret Flinter.

Mark Masselli: And I am Mark Masselli . Peace and health.

Conversations on Health Care, broadcast from the campus of WESU at
Wesleyan Uni versity, streaming live at Wesufm.org and brought to you by the
Community Health Center.