September 7th, 2009 by Happy Hospitalist in Better Health Network, Health Policy
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The time has come to change the rules. As you know the current insurance market is unsustainable. Whether you’re talking about The Medicare National Bank or your Blue Cross, they are all doomed for failure. Why? Because they treat everyone (group plans) the same . And as a result, the incentive towards health has been lost.
What if it wasn’t like that? What if your cost of insurance was 1/10 as much? What if you only paid $1000 a year in insurance, and carried an income based high deductible health policy? What if you were required to take care of the oil changes while your insurance, an affordable insurance, was there to protect you from disaster. An insurance you bought in the open market.
Is all this possible in the current insurance market? Not even close. If you are lucky enough to be employed by a big corporation, you are lucky enough to have deep premium discounts and a large population to spread the risk. If you work for a small business or are a small businessman, you are just one major illness away from catastrophic premium increases. Should you or one of your employees get sick, you’re all screwed.
If three of Happy’s hospitalists suddenly became gravely ill with H1N1 and were left on the ventilator for weeks and accrued hundreds of thousands, perhaps millions of dollars of health care bills, the cost of my premiums would rise dramatically, as a consequence of the large risk in a small pool of people, Happy’s private hospitalist group. While big business is able to spread that risk over hundreds, sometimes thousands of employees, they too are finding that they can’t keep up with the cost of health care inflation.
Why? Why does it have to be so difficult? When people are put in control of their health care dollars, they have a skin in the game that can’t be appreciated by the third party insurance model. Few people realize that the $12,000 in premiums their employer is paying, on their behalf, is $12,000 that is coming out of their pocket.
Many liberals want to claim that middle class wages were stagnant during the Bush years. Hardly, when you account for the health care premiums their employers paid on their behalf, the numbers don’t look so bad. These are stealth wages, wages which might as well be cash in your pocket.
Unfortunately, the current rules of the land have created a completely irrational playing field. Why should my choices be limited to what my employer offers or what my state says is right for me? Why should I be straddled with massive rises in insurance premiums because three of Happy’s partners had an unlucky run in with a virus? It shouldn’t have to be that way.
That’s why I see market choice and responsibility as the way out of this fiscal disaster. If premiums have doubled in the last 10 years to $12,000, how many businesses big and small can afford $25,000 in ten more years? The answer is almost none. Obama’s proposals do nothing to address this factor. The solution is not more insurance. The solution is not Universal insurance. The solution is to change the rules of the game. Rules your government created. Rules which brought us where we are today. The current insurance model does not work because our insurance has become an inflated currency of trade. A currency which is not allowed to follow the rules of supply and demand. Look only to the expansion of health care jobs in the worst recession in over 50 years and ask yourself how that is possible. And ask yourself if that is sustainable.
I do not want to be paying $25,000 a year a decade from now. $25,000 a year for taking care of myself and doing what’s right for my body.
- Don’t smoke,
- Engage in 3 1/2 hours a week of exercise.
- Eat a diet high in fruits and vegetables and low in read meat
- Don’t become obese (BMI >30)
If you do these four lifestyle actions, your odds of falling ill with one of these top four life changing or life ending diseases is slashed by 80%. That is an amazing fact. To a major degree you have the ability to decide your destiny of health by the actions you choose.
That’s the insurance pool I want to be a part of. Read more »
*This blog post was originally published at A Happy Hospitalist*
September 7th, 2009 by DrWes in Better Health Network, Health Policy, Health Tips
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“I don’t know what could be more clear,” said Representative Bruce Braley, Democrat of Iowa, who has read aloud from a section of the House bill with the title “No Federal Payments for Undocumented Aliens.”
“Heath Care Debate Revives Immigration Battle,”
New York Times, 6 Sep 2009
From House Bill 3200, page 143:
SEC. 246. NO FEDERAL PAYMENT FOR UNDOCUMENTED
4 ALIENS.
5 Nothing in this subtitle shall allow Federal payments
6 for affordability credits on behalf of individuals who are
7 not lawfully present in the United States.
* * *
Taxpayers are concerned whether they will have to foot the bill for illegal aliens in the upcoming health care bill. Many ask good questions, like how will health care workers know who’s an illegal alien? If they are included, how will it be paid for? These are important questions that we would hope could be dealt with squarely, openly and with full transparency.
But this is a sensitive topic for Congressmen interested in securing reelection.
During the summer recess, many Congressmen were barraged by questions to this effect. So it was interesting reading this New York Times piece this morning on whether illegal aliens will be covered under the new health care plan before Congress. On one hand we have Congressmen placating his constituents by assuring voters that “I don’t know how it could be more clear” as they suggest taxpayers will not fund illegal aliens, but careful inspection discloses that illegal aliens will just not be eligible for federal subsidies to reduce their payments for federally-supplied health insurance.
But from here, it gets even more byzantine:
… the report finds that the House bill would not prohibit illegal immigrants from enrolling in a health insurance exchange. The exchange would allow participants to buy coverage from one of several plans, including a public option offered by the federal government.
At the same time, illegal immigrants would not be exempt from the obligations in the House bill. According to the research service, most illegal immigrants in the country would be required to buy health insurance or face tax penalties.
And since they would be barred from subsidies, they would have to pay for coverage at full rates, regardless of their income level.
So here we have illegal aliens, already strapped for cash, paying their “full payment” and if they don’t, the tax man will come after them (which is confusing to me, because I didn’t know that illegal aliens pay taxes).
So what is wrong with the public? How could they possibly be confused?
Here’s a thought: the only real way out of these shameful machinations is to deal with the immigration and health care issue separately, incrementally, and without this shell game. Doesn’t the American public deserve a more thorough discussion of this issue, rather than shoving it in to our upcoming health care legislation?
My personal sense of it is that such an issue will never be decided at the Emergency Room door. Rather, it is part of a systemic immigration control and reform question that involves our borders, employee verification, and a decision about existing illegal immigrants.
What we’re observing instead, is a Congress is too scared to deal with this issue honestly.
*This blog post was originally published at Dr. Wes*
September 3rd, 2009 by EvanFalchukJD in Better Health Network, Health Policy
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Bad news in the paper today: health care costs are expected to rise another 10.5% next year. It’s a serious problem that affects businesses and families across the country.
But the headlines miss something important: the rate of increase has been steadily slowing.
Are we already bending the health care cost curve?
Here is a chart of the rate of increase in health premiums for a PPO plan beneficiary from 2002-2009 (all data are from today’s Aon press release):
The data for other plan types are similar. What’s happening?
Aon’s Chief Medical Officer Paul Berger says it’s because of the variety of measures employers have taken over the last several years to implement programs to improve their employees’ health. He emphasizes there is still much more to be done.
He has a point. It’s something we have seen in our survey of major employers, and in the work that leading employers like EMC and Genzyme are doing. It’s what my company does, too. Employers are getting increasingly sophisticated at understanding what drives their health care expenses and are developing increasingly effective ways at addressing them.
So, yes, of course, we need reform of our health care system, and of course rising health care costs are a serious concern. But American employers are doing something about these problems all on their own.
*This blog post was originally published at See First Blog*
September 2nd, 2009 by AlanDappenMD in Primary Care Wednesdays
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My early childhood memories hit and miss like a receding dream until four years of age when I boarded my first airplane flight. Our family landed in Mexico City to live. The experience was the first of many jolts which awakened my dreamy complaisant memory.
Within weeks I started kindergarten. That first day was filled by my ceaseless crying. Much to my relief, I had mastered the art of playing hooky by the next morning. A week later I matriculated into the American school. Scary but at least fifty percent of the day was in English. It wasn’t long before a Mexican classmate invited me to his birthday party, complete with a piñata. I was too young then to understand that a piñata holds as much in life metaphors as candy and little did I realize then that this metaphor would resurface again in my life decades later as the efforts to reform the embattled U.S. healthcare system.
Like so many things that first year in Mexico, the piñata held excitement mystery and possibility. At that first party I was an eyewitness to a mob. The instant the piñata broke open the school of piranha-like children devoured the innards so fast that I was left dejected, clutching only a little scrap given to “the gringo” by some benevolent adult.
At the next party, when it was piñata, time, I was in the mix; I dove in before the final coup de grace and caught a piece of the bat. My strategy turned upon being first one in but missing the bat, only to learn that this transferred the piñata to the one embracing almost all the candy. I was jumped, kicked, whacked, gouged, and crushed to smithereens while all those greedy hands and bodies piled on me and plied the precious treasure for my hands. Once again I emerged with tears and a few scraps.
Finally by the fourth party I’d gotten adept with the bat and with a super satisfying whack disintegrated “the Toro” to shreds. Pay dirt at last. By the time, my blindfold was off, the scrum was well underway. The school of hard knocks was one more time teaching me a lesson.
Few activities can compete with a piñata party in a child’s imagination. It offers the opportunity of unimaginable candy treasures. After years of practice and experience the master can be picked from the crowd. This child can be seen as cool, calm, and collected. They bat early, never trying to break the treasure open but enough to soften it up. Once back in the pack they make subtle repositioning moves as the batter swings in different directions blindly thrashing at the swaying and bobbing papier-mâché animal idol. At the right moment they dive into the scrum usually coming up with a lot of candy. Winners keepers losers weepers. That’s the rules.
There are many strategies at the piñata party, the imagination of greed can get the best of you when all those marbles (or candy or money) sit inside that single collective pot.
Fifty years later I cannot help but reflect that the rules and spiritual lessons gained within the piñata experience are very applicable to the US healthcare system. With thirty years of healthcare experience I remain awe struck at observing the same sets of behaviors demonstrated at children’s piñata parties.
Be you the patient, doctor, hospital, pharmaceutical company, lawyer, supplier, coder, consultant, or insurance company, each party fully play out their perfect, “what’s in it for me” expression, “Don’t worry what this is costing, we’re just attacking the piñata. Everything in the party has been fully covered. Cracking a few of heads to reach the object of my desire is just good party fun, no offense.” We have become piñatas inside of piñatas, with of course the patient metaphorically becoming the ultimate piñata, after all the party is thrown for each and every one of us willing to pay entrance to the ever increasingly expensive party.
Next week I will start with my personal experience and then move to the global great American health care healthcare piñata gala bash. Let me get the party invitations sent out and also invite you to attend the grand gala 2009 healthcare piñata party.
I’ll let you bring the pinata to my party if I can bring mine to yours.
Until next week I remain sincerely yours in primary care,
Alan Dappen, MD
September 1st, 2009 by GruntDoc in Better Health Network, Health Policy, Opinion
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In an effort to get the word out about their new EM Physicians’ blog ( em-blog.com ) Dr Bukata has asked to post here to generate some conversation, and some buzz for their blog.
Dr. Bukata has long been a leading light in EM, and it’s my pleasure to present:
THE SECRET TO UNIVERSAL HEALTH COVERAGE – DOCTOR BEHAVIOR
As the debate goes on regarding the Obama initiatives for healthcare reform, the one recurring theme that is heard is – cost. What is universal access to healthcare going to cost and who is going to pay for it? It really is just about money. The fundamental premise is that, if we spend at current rates, it will cost an ungodly amount of money to cover everyone in this country no matter who pays.
Given that we cannot continue to spend at the current rate, yet we want to insure the 40 million people or so who have no insurance (and all of this is supposed to remain budget neutral over time), the logical answer regarding cost must be reducing per capita spending while increasing the number of people covered.
How do we achieve this goal? There is really only one way. The answer is to narrow practice variation. Practice variation between doctors is absolutely huge. The data are compelling. Even small changes in the degree of practice variation have the potential to save hundreds of billions. I refer readers to an article in the New England Journal of Medicine by Elliott Fisher, et al (360:9, 849, February 26, 2009). The article is entitled Slowing the Growth of Health Care Costs – Lessons from Regional Variation. This short paper gives examples derived from the Dartmouth Atlas on Health (which I have referred to in the past and which is absolutely fascinating reading concerning Medicare practice variation nationally) that make it clear that doctors are major determinants of healthcare costs. We order the tests, we order the drugs, we put people in the hospital and we determine where they go in the hospital and, to the chagrin of hospital administrators, we determine how long they stay.
Using Medicare as an example, at our current rate of spending growth in healthcare it is estimated that Medicare will be in the hole by about $660 billion by 2023. If per capita growth could be decreased from the national average of 3.5% to 2.4% (just a measly 1.1%), Medicare would have a $758 billion surplus. Just a measly 1.1%.
Now for some examples. Per capita inflation-adjusted Medicare spending in Miami over the period 1992 to 2006 grew at a rate of 5% annually. In San Francisco it grew at a rate of 2.4% (2.3% in Salem, Oregon). In Manhattan, the total reimbursement rate for noncapitated Medicare enrollees was $12,114 per patient in 2006. In Minneapolis it was $6,705.
It is noted that three regions of the country (Boston, San Francisco and East Long Island) started out with nearly identical per capita spending but their expenditures grew at markedly different rates – 2.4% in San Francisco, 3% in Boston and 4% in East Long Island. Although these differences appear modest, by 2006 per capita spending in East Long Island was $2,500 more annually than in San Francisco – with East Long Island representing about $1 billion dollars more from this region alone.
Are the patients sicker in East Long Island? Hardly. There is no evidence that health is deteriorating faster in Miami than in Salem. So what’s the difference? People point to “technology” as being one of the biggest sources of costs in American healthcare. But “technology” does not account for these regional differences. Residents of all U.S. regions have access to the same technology and it is implausible that physicians in regions with lower expenditures are consciously denying their patients needed care. In fact, Fisher and colleagues note that the evidence suggests that the quality of care and health outcomes are better in lower spending regions.
So what is the answer? It is physician behavior.
It is how physicians respond to the availability of technology, capital and other resources in the context of the fee-for-service payment system. Physicians in the higher cost areas schedule more visits, order more tests, get more consults and admit more patients to the hospital. Medicine does not fit the supply and demand model of modern day capitalism. Normally when there is lots of competition, prices go down. Not in medicine. In medicine payment remains the same and is not sensitive to supply or demand.
And normally when there are a lot of businesses providing the same service, there are fewer customers per business. Not in medicine. Although doctors may have fewer patients in an area saturated with providers, they don’t necessarily have fewer visits because doctors determine the frequency of revisits and the literature indicates there is huge variability in what they consider the appropriate frequency for revisits when given identical patient scenarios. And do patients shop prices to choose medical providers – no way – it is impossible. Bottom line – medicine is largely immune to the laws of supply and demand and other economic drivers.
So what’s the answer? It is simple, yet hard. Doctors in high cost areas need to learn to practice like doctors in low cost areas. Are doctors in low cost areas beating their chests and bemoaning the inability to care for their patients with the latest technology? Not at all. But doctors in high cost areas are largely clueless to the practice patterns of physicians in low cost areas and are likely to whine if asked to tighten their belts and learn to be more cost-effective. The good thing – mathematically, this will result in only half the doctors in the country complaining as they are prodded to emulate the practices of their more cost-effective cousins.
To accomplish this narrowing in practice variation, doctors will need help (and, particularly, motivation). Payers and policymakers will need to get involved to facilitate and stimulate the information transfer between doctors. Based on research by Foster and colleagues, it’s advised that integrated delivery systems that provide strong support to clinicians and team-based care management offer great promise for improving quality and lowering costs.
Given that most physicians practice within local referral networks around one or more hospitals, it is suggested that they could form local integrated delivery systems with little disruption of their practice. Legal barriers to collaboration would need to be removed by policymakers and incentives to create these systems would drive their formation.
Fundamentally, Medicare would need to move away from a solely volume-based payment system (since doctors are the drivers of their volumes) and other forms of payment would need to be incorporated (such as partial capitation, bundled payments or shared savings). Hospitals and doctors lose money when they improve care in ways that result in fewer admissions, and they lose market share when they don’t keep pace in the local “medical arms race” (does everyone need a 64-slice CT?). In the current system there are no rewards for collaboration, coordination or conservative practice. This must change.
The bottom line – much can be done to save money yet provide patients with high quality, technologically advanced care without rationing (or worse yet having some government “board” telling you what to do). There is so much waste in the current system largely resulting from physician practice variation that the opportunities are huge.
And, should they choose, doctors are in a position to take the lead. The AMA and other physician organizations can initiate (well, that may be asking a lot) and support incentives that will facilitate the needed changes outlined above. Unfortunately, organized medicine (almost an oxymoron) is more often than not reactionary. “What are they (payors) making us do now?” That’s the typical response. What’s needed is for physicians to take the leadership role that their patients expect of them. The status quo is not an option. And if doctors won’t act, the payors will – because ultimately, the payors have the power. That is one rule of economics that does apply even to the practice of medicine.
W. Richard Bukata, MD
I respectfully disagree about markets not working in medicine, but have few arguments with the rest.
What say you?
*This blog post was originally published at GruntDoc*
