Medicare Cuts and Tough Choices, Research Paper Example

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Research Paper

The economic downturn of the past few years has had an alarmingly deleterious effect on the health care industry. As government budgets and services are slashed, the services that can be offered to patients in various clinical settings are also subject to reduction. Services to lower-income residents are particularly hard-hit, as they often are dependent on payments from Medicare. A case study of a County Medical Clinic serving a large low-income population that has just had its Medicare budget cut by 15% serves as a prime example of the realities of the situation; making determinations about what services to cut can be extremely difficult. Using the Informed Decisions Toolbox (IDT) offers a structured, effective way to assess the best way to approach the problem, and to help ensure the best possible outcome.

The IDT was developed to combat the problems of “bounded rationality” and “sufficing,” wherein a manager’s decision-making processes were limited in scope and often ended in settling for a “good enough” solution to a problem (Rundall et al, 2007). The IDT offers a context in which a manager can best assess not just what decision to make, but how to find the information needed to make that decision. The IDT has six primary steps:

  1. Framing the Question
  2. Finding Sources of Information
  3. Assessing the Accuracy of the Evidence
  4. Assessing the Applicability of the Evidence
  5. Assessing the Actionability of the Evidence
  6. Determining if the Information is Adequate

Rundall et al, 2007

The first step, “framing the question,” involves determining the impact of the Medicaid cuts and assessing what services must be cut. Those served by Medicaid are on the lower end of the socioeconomic scale, and who meet certain criteria. Among the primary recipients of Medicaid are children, pregnant women, adults with disabilities, and seniors (medicaid.gov). The question becomes “what services can be cut or reduced while still serving the needs of these populations”? As the IDT process unfolds, this general question will be broken out into a series of more specific questions that “each address(es) a single informational gap” (Rundall et al, 2007); in this instance it would likely be helpful to frame questions relevant to each particular demographic group in the Medicaid population.

Step 2, “finding sources of information,” means wading through a sea of information in order to find that which is relevant and helpful in this context. There are innumerable sources of information available to managers, so it is imperative that an information search is “directed (and) comprehensive” (Rundall et al, 2007)). There are numerous significant and reliable sources of information available for managers working in the clinic setting, and it is their responsibility to take steps to find and work with them.

In this context, it may be useful to assess how the economic downturn and cuts to Medicaid and other sources of funding are affecting other clinics regionally and nationally. The available evidence indicates that a range of services are being cut at clinics across the nation, such as referrals to specialists, expensive diagnostic testing, and dental services (Quirk, 2011). This information is hardly surprising; the most expensive services are naturally, the first to be cut.

Step 3, “assessing the accuracy of the information,” requires decision makers to determine if the information that has been gathered is factually correct and of the highest standard. In this context, the use of academically-vetted material is crucial. It is again worth noting that managers may tend to make decisions based on what they think they know; the potential to do so may best be avoided by the insistence on using accurate, independently-assessed information.

Step 4, “assessing the applicability of the information,” is as crucial as Step 3. The impact of Medicaid cuts on one clinic may be wholly different from that on another, and an array of factors can determine these impacts. A clinic with serving a larger low-income population will likely be far more greatly affected than one with a limited number of such patients (Silberman, 2005). It is at this stage that information that is accurate may be determined to be inapplicable to the situation.

Step 5, “assessing the actionability of the information,” involves weighing the applicable information against the real-world circumstances of this clinic. At this stage it becomes necessary to consider what the implications will be of implementing various strategies, and whether these strategies will best serve the needs of the clinic’s population.

Step 6 involves determining if the collected information is adequate to the task at hand. In this instance, a cursory examination of the available evidence shows many similar choices being made across the country, as the most expensive treatments, tests, and services are being slashed (Sherry, 2012). Given this consistency of information, it seems clear both that economic constraints are largely driving the decision-making processes at clinics around the country and that the same decisions are being made on a national level.

Of all the tools presented by the IDT, it is this last one that appears to be most relevant to the situation. This assessment does not preclude the significance of the other tools, of course; it is simply noteworthy in this instance that there are a vast number of clinics facing the same problems and reaching the same conclusions where budget cuts are concerned. Give this across-the-board consensus, it appears clear that the available information is adequate to the task, and all that remains is to apply the information to the real-world context.

After a cursory examination of the evidence in this context, it seems apparent that a reduction of the most expensive services offered by the clinic is inevitable. Given this inevitability, this clinic should begin to place greater emphasis on preventive care and wellness, as the costs of preventive care are, of course, lower than the costs of palliative care. This emphasis will not necessarily solve all of the clinic’s budget problems, but it will hopefully provide a solid first step towards developing an environment in which the most can be done with least where patients are concerned.

It is important to recognize that the IDT does not do the work for the clinic manager and other decision makers. Simply having good information will not solve problems; until this information is applied to the real-world setting it is of little use. Once the IDT process is complete it is still up to people to make the appropriate, effective decisions. In the overall health care environment, the issue of “accountability” is a major concern. In the context of this situation it is imperative that accountability becomes part off the organizational culture, so that decision makers strive to make the best decisions with the best available evidence.

In order to ensure that the best decisions are made with the best available evidence, it is incumbent on the organizational leaders to establish the structures and processes needed for knowledge transfer (Rundall et al, 2007). What this means in practical terms is that guidelines for decision-making processes must be established; in this sense, it is about applying the conceptual model of the IDT to the real-world setting. The processes of the IDT will not just happen; it is necessary to create a committee dedicated to that purpose, and to appoint a chief knowledge transfer officer to oversee the dissemination of knowledge and information once the steps of the IDT and other information-gathering processes have been carried out.

Although the scenario discussed herein is somewhat specific, the concepts discussed are applicable to a wide range of organizations. The ultimate purpose of the IDT is not to force people to adhere to a set of words on paper, but to create a “questioning culture” (Rundall et al, 2007) that recognizes the value of avoiding bounded rationality and instead seeks the best available evidence relevant to all decision-making processes. In the context of a clinic suffering budget cuts, these processes may be painful, but the IDT is one way that some of that pain may be alleviated.

References

http://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Population/By-Population.html

Quirk, Shannon et al. “Impact of cuts to Medicaid and Commonwealth Care Adult Dental Coverage on Massachusetts Community Health Centers.” Massachusetts Leageu of Communoity Health Centers. 2010-2011 report. http://www.massleague.org/About/DentalCutImpactReport2011.pdf

Rundall et al. “The informed decisions toolbox: tools for knowledge transfer and performance improvement.” Journal of Healthcare Management. 52(5). September/October 2007.

Sherry, Mike. “Report assesses impact of MO Medicaid Cuts, economic downturn on hospitals and safety net.” KHI News Service. 4 June 2012.

Silbermaan, Pam et al. “The impact of Medicaid cuts on rural communities.”  North Carolina Rural Health Research and Policy Analysis Center. The University of North Carolina at Chapel Hill. August 2005.

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