June 30, 2023
On May 31, 2023, CDRP Associate Director for Health Policy R. Tamara Konetzka, Louis Block Professor of Public Health Sciences, became one of three new members of the Medicare Payment Advisory Commission (MedPAC). Established in 1997, MedPAC analyzes access to care, cost and quality of care, and other issues affecting Medicare. The 17 MedPAC commissioners meet monthly over a three-year renewable term and produce reports twice a year advising Congress on payments to providers in Medicare’s traditional fee-for-service program and to health plans participating in the Medicare Advantage program.
Konetzka first began assessing health policy impacts as an economist working for the American Health Care Association, a nursing home trade association in Washington, DC, in the 1990s. “I was always interested in the methods behind rigorous policy assessments and got very interested in the substance,” she recalls of what has now become over 25 years of research dedicated to long-term and post-acute care, Medicaid, Medicare, and how policy affects access, quality, and other impacts to these systems.
While access to ordinary health insurance is challenging for many Americans, insurance for long-term care—care for a person who can no longer perform everyday activities like bathing, eating, and dressing on their own—is almost nonexistent. Medicare fully covers short-term post-acute care in a nursing facility for 20 days and offers partial assistance for just 80 more. For those in need of more care, with an average annual out-of-pocket cost of more than $100,000 a year, nursing homes can rapidly drain a lifetime of savings. “Medicaid is required by law to cover nursing home care for people who don’t have resources and need long-term care,” says Konetzka. “In nursing homes today there are 1.5 million people. Two-thirds of those are on Medicaid.”
After nearly five years at the nursing home trade association, Konetzka pursued a PhD in health economics at the University of North Carolina at Chapel Hill, writing a dissertation on the effects of the prospective payment system for skilled nursing facilities Medicare began implementing in 1998, which pays a per diem to the facility based on a person’s diagnosis rather than paying a separate fee for each service at the facility. She found that the change to prospective payment, while reducing Medicare post-acute payments, also reduced quality of care for Medicaid long-term care residents. This finding is consistent with longstanding anecdotal evidence that nursing homes cross-subsidize, using higher Medicare payments to make up for low Medicaid rates. When Medicare becomes less generous, it affects Medicaid residents as well.
In addition to payment, Konetzka also studies the quality of long-term care, another challenge due to low Medicaid rates for care and ineffectual regulation in a largely for-profit industry. “There are nursing homes that do try hard and provide a decent level of care, but there are so many that don’t,” she says. “It’s an intractable problem, especially because we’ve been underfunding long-term care for a long time. Countries like France, Germany, the Netherlands, and Sweden have national long-term care insurance—but of course they’ve built that on top of having a national health insurance. We haven’t gotten there yet.”
A member of the technical expert panel that advises the Center for Medicare and Medicaid Services (CMS) on the Nursing Home Compare 5-star rating system that publicly reports nursing home quality since 2014, Konetzka conducts qualitative and quantitative research to answer a variety of questions, such as, “Do consumers use rating systems? Do providers game the system? Do providers select residents because of the rating system? Do providers improve their quality as a result of the rating system? Are there equity implications to the rating system?” The answer to most of these questions is yes: Publicly reporting quality changes consumer behavior to a modest extent, and providers do try to improve quality in response, but some providers try to gain the system and benefits to consumers are unevenly distributed.
Some of Konetzka’s current research focuses on people who need long term care and are eligible for both Medicaid and Medicare because they are over the age of 65 and have either already exhausted their savings or have enrolled in Medicaid due to a disability. Required by law to cover nursing home care through Medicaid, states in recent decades have expanded coverage to include home- and community-care options. While that increases choice for patients, it may also affect their medical outcomes and have additional consequences for their families and caregivers, says Konetzka. “Even though people typically prefer home- and community-based care, they get hospitalized more,” she says, noting that the tipping point for hospitalization may be lower without the constant presence of expert care. “We’ve also found adverse effects for family caregivers, like burnout, which may be worth it to some but takes its toll on caregiver health and labor force participation. To do home- and community-based care the right way and minimize these adverse effects, we may need to invest more to ensure people have sufficient services.”
Beginning in 2020, Konetzka also began to study the effects of public health measures on nursing homes, focusing on predictors of COVID-19 cases and deaths in nursing homes, where nearly 40% of the country’s COVID fatalities occurred. “The results are clear and consistent, and not what many expected,” she said in a testimony before the US Senate Finance Committee on March 17, 2021, one of two testimonies she has delivered to Congress in recent years. “A large body of evidence, some produced by our team at the University of Chicago and some by others, shows that the two strongest and most consistent predictors of worse COVID-19 outcomes are nursing home size, with larger facilities being more at risk, and COVID-19 prevalence in the surrounding community.” Noting that rigorous studies did not show an association between COVID-19 outcomes and nursing home quality metrics, she concluded, “high quality and good infection control measures are not enough. . . the single most important thing we could have done better as a nation to reduce the tragedy in nursing homes was to use public health measures to control the spread of the virus in the general population.”
Konetzka and her colleague Prachi Sanghavi, assistant professor of Public Health Sciences and a CDRP faculty affiliate, recently created and co-direct the University of Chicago Health Policy Data Lab, which houses and administers the Medicare and Medicaid claims data accumulated over years by researchers at the University of Chicago. Currently about 50 members of the University, including doctoral students and faculty, are engaged in studies that use these data—a growing field of interest at the University. Contributers to this effort include The Becker Friedman Institute, the CDRP, and the Center for Health Adminstration Studies, which first began convening a Medicaid data working group attended by researchers in public health, social work, public policy, and health economics in 2015.
Of her new advisory role with MedPAC, Konetzka says, “I am looking forward to providing input to Congress and grateful to have a more direct channel to policymakers than I usually have as an academic. Of course, improving post-acute and long-term care policy is a monumental task. MedPAC’s goal is not to fix the whole health system, just to improve the Medicare program, so my ability to inform policy around long-term care will be limited and will not result in the kind of fundamental reform I think is necessary. But Medicare touches the lives of older adults with long-term care needs in many important ways, so it’s a start.”
Story and photo by Irene Hsiao