I have had a long working relationship with an institution that was once the Youngstown Hospital Association (YHA), then the Western Reserve Care System and most recently Forum Health. That affiliation began in 1953 when I worked as an orderly for two summers following graduation from high school. I watched that hospital system evolve into what ultimately became the 10th largest community, teaching hospital in the nation in the 1960s; an efficiently managed facility with 1000 beds. YHA had rotating internships (numbering 25 newly graduated physicians per year) and residencies in internal medicine, surgery, pediatrics, family practice, radiology, anesthesiology, dentistry and pathology; the total intern and resident house staff numbered approximately 100. While serving as an intern in 1961 to 1962 I noted that the hospital was quite well managed by one administrator (Mr. David Endres) and a medical director (Russell Rummel, MD) who each shared a secretary between them; Mrs. Rae Moore. They spent one half a day at each unit; north and south. The place ran like a well oiled machine.
YHA became the first hospital in the state to have a virology and genetics lab run by Mr. Robert
Tamburro. Our Chief of Pathology, Dr. Arthur Rappaport, in conjunction with the local office of IBM, developed the first cybernetics laboratory in the world. He was initially able to run twelve tests on one vial of blood that was placed in his complex high tech device. Previously each of those twelve tests had to be run, one at a time, over an hour or more, by one or more lab technicians. Ultimately his design enabled the system to evaluate thirty blood chemical tests at a time plus a complete blood count; consisting of red blood cell and white blood cell counts, in addition to a packet cell volume, total hemoglobin and platelet count.
When I returned to the hospital after two years on active duty in the US Air Force in 1964, the number of administrators had tripled and with the onset of Medicare in 1965 it doubled again. In addition to the administrators, countless numbers of clerical workers were added to accomplish the reams paper work demanded by the government‘s numerous rules and regulations.
In 1967 YHA experienced the first nurse’s strike that had ever occurred in the United States. Youngstown had always been a strong union town because of the steel mills and the national nurse‘s union, took advantage of that mind set to force a work stoppage. The time and place were ripe for this walkout, though most people in the community were appalled that the nurses could do such a thing. I was chief medical resident at the time and was thus responsible for doing triage on the medical floors, deciding which patients could safely be sent home. After assessing the need for a patient’s continued hospitalization I then had to call the attending physicians and incur some of their misplaced wrath. In those days a patient with a myocardial infarction (heart attack) remained hospitalized for 30 days; now they are out in less than a week. From that time on, every three years the hospital either had a work stoppage or yielded to the union demands. It was not long before the service workers union and skilled technician unions would come in as well and threaten to shut the hospital down if their financial and other goals were not met. Across town, the St. Elizabeth Hospital
Board, not having to contend with unions, simply watched to see what our various workers settled for and they would offer an increase, but a little less, to their employees. Since their workers did not have to pay union dues, the increased pay was nearly identical to that which a YHA nurse or other worker obtained through the strike. Thus not having to incur the expense of work stoppages or the increased wages demanded by unions, St E’s always had a better fiscal bottom line than we did at YHA (later named WRCS and then Forum).
I began to sit on the Board of the Western Reserve Care System (WRCS) during my two years as President of the Attending Staff from 1985 to 1987. In 1988 I was selected by the Board to fill a full time position which I held until my voluntary resignation in 1998. It was during that time that the Medicare reimbursement dollar began to shrink and the hospital was paid at first 70, then 60 and ultimately 50 cents on each dollar billed to Medicare. It would not be very long before the hospital was also doing business with HMOs and their reimbursement soon echoed that of Medicare. The snow ball of economic insolvency continued gradually took on wieght. There were more staff hirings to cover more bureaucratic rules and regulations, more raises to meet union demands and less reimbursement from the government and HMOs. Added to that mix were a shrinking market and an effort to keep up with cross town St E’s expansion into the suburbs. Recall, that their bottom line could tolerate expansion better than ours and they were further supported by a national Roman Catholic health corporation called Humility of Mary.
In 1989 the WRCS administration had hired a consulting firm to help in the planning for the future of the WRCS. The consulting team came into Youngstown for one month and studied our hospital systems and demographics. The mills had gone down by that time and as young folks left home for college, they settled elsewhere in order to find work and build a life for themselves. Our population was suffering attrition from age related deaths as well. The consulting firm met with us over a two day retreat and told us the things we needed to hear, but vital planning information to which the future Forum Board did not take heed.
In 1989 Youngstown had four hospitals totaling 1600 beds; WRCS North and South units, St E’s and Youngstown Osteopathic (YOH). The consulting team, noting the exodus of young people and the aging of those who remained, predicted that by the turn of the millennium (2000) the Youngstown metropolitan area would only be able to support one hospital with 500 beds. Eventually YOH closed its doors; Forum closed the South Side unit and both remaining hospitals (Forum North and St. E’s) cut back on the number of their open beds. By the year 2000, the prescience of the consulting firm was verified; the town had two hospitals, each with 250 beds, competing for a shrinking market. St. Es had long since merged with Humility of Mary (HM). If they experienced a short fall the HM system would pump in funds to shore them up. They also enabled St Es to expand with less threat to their net worth. Forum could not keep pace financially with that strong national organization. The rest is history.
Before the Beeghly Women’s birthing center was sold to an Akron Hospital that plans to build a pediatric hospital, we had the only pediatric, acute care game in town: Tod’s Children‘s Hospital. I urged members of the Forum Board and the Mayor Williams (he had complained about a lack of community input) to consider combining the two hospital systems (St Es and Forum) into one and to
hold on to the best of both systems while selling off or demolishing the rest. That would have put all 500 beds in one efficient unit in Boardman, maintaining our excellent Tods Childrens Hospital, and affording, immediate and emergent inner city care through the Belmont Avenue Facility. It would have also afforded the nursing and ancillary staff workers job security. My recommendations fell on deaf ears and the Forum board continues to rearrange the deck chairs on a sinking cruise ship by selling off piece by piece, its numerous assets, such as the women‘s birthing center. The diminutive size of Forum North (200 beds) will not be a favorable sign to the residency review committees who come to evaluate our excellent internal medicine, surgery and pathology residencies; the only three now remaining. There are not a sufficient number of patients to afford a broad teaching experience to these residents. If Forum loses its residency programs the quality of health care is certain to diminish. Residents keep attending on their toes. They also provide 24/7 coverage for the patient population.
Friday, August 29, 2008
Tuesday, August 26, 2008
Americans Changing Their Behavior to Lessen Healthcare Costs
If Senator O’Bama and his socialistic ilk are able to bring about a National Health Care system two factors, which they may not have considered in their equation for determining the cost of that new system of health care delivery, need to be factored in; namely the deleterious effects of smoking and the nationwide epidemic of obesity. Each of those negative impacts on one’s general health will dramatically increase the cost of medical care as the years go by unless there is some positive incentive for changing one’s life style and destructive behavior. Free medical care is no incentive.
During the past 24 years there has been a dramatic increase in the incidence of obesity in the United States. Data from two surveys reported by the Atlanta based Center for Disease Control and Prevention (CDC) show that among adults aged 20–74 years the prevalence of obesity increased from 15.0% (in a 1980 survey) to 32.9% (in the survey conducted in 2004 ). Obesity of every degree is a serious health concern, not only for adults but also, increasingly, for children and adolescents. Data from the same surveys (1980 and 2004) demonstrated that the pervasiveness of obesity is mounting in young folks as well. For children aged 2–5 years the prevalence grew from 5.0% (in 1980) to 13.9% (in 2004), for those aged 6–11 years it increased from 6.5% to 18.8%; and for those aged 12–19 years the incidence of obesity was inflated from 5.0% to 17.4%. There are several reasons for this increase, but the bottom line is that Americans eat too much junk food and get far too little exercise. Children no longer go out doors to play, unless they are engaged in structured, seasonal sporting activities via little league basketball, baseball, football and/or soccer organizations. Too many young folks merely sit around in their rooms playing video or computer games or text messaging friends. The July 16, 2008 addition of the Journal of the American Medical Association (JAMA) reported on the results of a 6 year study (2000-2006) wherein the exercise habits of 1000 of our country’s young people were tracked. The results demonstrated that while 90 % of youths at age 9 got about two hours of exercise on most days, fewer that 3% of the teens who were followed at age 15 got any exercise at all; the time when little league sports usually ends.
Obesity is the leading cause of preventable death and disease in the United States; now tied with cigarette smoking. It is associated with hypertension (high blood pressure), osteoarthritis (a degeneration of cartilage and the underlying bone within a joint), dyslipidemias (increased levels of cholesterol or triglycerides), type 2 diabetes, coronary heart disease (the nation’s number one killer), stroke, gallbladder disease (especially gall stones), sleep apnea and other respiratory problems, gastro-esophageal reflux (GERD) and some cancers (particularly those associated with estrogen production such as malignancies in endometrial lining of the uterus, as well as breast and ovarian cancers). There is also a higher prevalence of colon CA in obese people. Every one of those diseases will become an increasingly greater problem if the current trends in obesity are not brought under control. With someone else paying the bill for the care of those diseases, there is little motivation for behavioral alterations such as following prudent diets and engaging in increased amounts of exercise. Imagine what will happen to the over all health of our nation’s citizens if the next 24 years brings another 15% rise in the incidence of obese adults, as it did between 1980 and 2004. The proposed National Health Care system will neither encourage changes in behavior nor will it be able to sustain the exorbitant cost of medical care of that large number of people apart from drastic increases in taxation or rationing the accessibility of services.
Obesity is defined as having a body mass index (BMI) greater that 30. Morbid obesity is further identified by attaining a BMI greater than 40. A BMI between 25 to 29 is considered being over weight. One can calculate one’s BMI by taking one’s height in inches, squaring that number (I.e. 68 times 68 if one is 5 ft 8 in. tall) and dividing that figure into one’s weight in pounds. That figure (a fraction) is then multiplied by a standard 703. The figure thus produced is then one’s BMI. For example a 5 ft 8 in tall person who weighs 160 lbs would compute his/her a BMI as follows: 68 x 68=4,624. 160 divided by 4,624=.035. .035 x 703 = 24.6. Thus that person is considered to be of a maximum normal weight for height.
The prevalence of morbid obesity was 4.7 percent in the year 2000, according to the latest published figures from the Center for Disease Control; up from 2.9 percent observed in a national data set obtained from 1994. From 2000 to 2005, the prevalence of obesity (BMI over 30 but less than 40) increased by 24%. However, the prevalence of a BMI over 40 (morbid obesity) increased by 50% and the prevalence of a BMI over 50 increased by 75%, two and three times faster respectively, than simple obesity. Given those trends and the numerous diseases and disabilities that result there from, one can readily see that a national healthcare system, where people are not responsible for paying the bills for their expensive medical care, will result in taxations that will markedly alter the current life styles of the citizens of middle America. This is not going to be just a “tax the rich” scenario.
In 2006, 20.8% (45.3 million) of U.S. teens and adults were then admittedly cigarette smokers; of those, 80.1% (36.3 million) smoked every day, and 19.9% (9.0 million) smoked some days. The prevalence of cigarette smoking further varied substantially among population subgroups. By sex, prevalence was higher among men (23.9%) than women (18.0%). Among racial/ethnic groups, Asians had the lowest prevalence (10.4%). Hispanics had a significantly lower prevalence of smoking (15.2%) than American Indians (32.4%), as well as non-Hispanic blacks (23.0%), and non-Hispanic whites (21.9%). Smoking prevalence also varied by level of education. Smoking pervasiveness was highest among adults who had only earned a General Educational Development (GED) diploma (46.0%) and those with 9 to11 years of education (35.4%); overall, smoking popularity was found to be inversely proportional to one‘s years of post high school education. By age differential, adults aged 18 to 24 years and 25 to 44 years had the highest incidence of smoking (23.9% and 23.5%, respectively). The inevitability of current smoking was higher among adults living below the federal poverty level (30.6%) than among those at or above this level (20.4%). At a cost of approximately $4.00 per pack, that can only be defined as abject foolishness. Cigarette smoking causes cancer of the lung, mouth, kidney, bladder and other regions as well. It is the main cause of emphysema (95%) and a major risk factor in peripheral vascular disease, heart attacks and stroke. With the ill effects of second hand smoke, even non-smokers who live with those who smoke will suffer from certain tobacco related conditions that will also add to the cost of the federal budget’s national health care bill.
The bad habits and destructive life styles in which some American’s have chosen to engage themselves, and the costly diseases that result from those habits are factored into the price that the rest of us pay in our insurance premiums. If we have HSA’s and catastrophic insurance (as suggested in a previous article), the premiums for which are based upon the risks imposed by smoking and obesity, those with destructive behaviors will have to pay for their choices. As Americans we are free to choose but for too long now we have failed to teach the hard, but axiomatic lesson that bad choices also incur bad consequences.
If we once again become a nation that uses the consumer driven, free enterprise system of health care, as it had been practiced before Medicare was instituted in 1965, then eventually people will see that their physically destructive behavior can affect their Health Savings Accounts (HSA) in a negative way. Those who smoke a pack per day could instead contribute the $120 per month spent on tobacco to their HSA, thus enabling it to grow that much higher; and by stopping smoking the need for expending the HSA monies will also drop off precipitously because of the lowering of the incidence of tobacco related disease. Fewer stops at fast food facilities basis will likewise assist in shrinking one’s waste line, thus ceasing its growth and instead adding to the growth of their health savings bank account.
During the past 24 years there has been a dramatic increase in the incidence of obesity in the United States. Data from two surveys reported by the Atlanta based Center for Disease Control and Prevention (CDC) show that among adults aged 20–74 years the prevalence of obesity increased from 15.0% (in a 1980 survey) to 32.9% (in the survey conducted in 2004 ). Obesity of every degree is a serious health concern, not only for adults but also, increasingly, for children and adolescents. Data from the same surveys (1980 and 2004) demonstrated that the pervasiveness of obesity is mounting in young folks as well. For children aged 2–5 years the prevalence grew from 5.0% (in 1980) to 13.9% (in 2004), for those aged 6–11 years it increased from 6.5% to 18.8%; and for those aged 12–19 years the incidence of obesity was inflated from 5.0% to 17.4%. There are several reasons for this increase, but the bottom line is that Americans eat too much junk food and get far too little exercise. Children no longer go out doors to play, unless they are engaged in structured, seasonal sporting activities via little league basketball, baseball, football and/or soccer organizations. Too many young folks merely sit around in their rooms playing video or computer games or text messaging friends. The July 16, 2008 addition of the Journal of the American Medical Association (JAMA) reported on the results of a 6 year study (2000-2006) wherein the exercise habits of 1000 of our country’s young people were tracked. The results demonstrated that while 90 % of youths at age 9 got about two hours of exercise on most days, fewer that 3% of the teens who were followed at age 15 got any exercise at all; the time when little league sports usually ends.
Obesity is the leading cause of preventable death and disease in the United States; now tied with cigarette smoking. It is associated with hypertension (high blood pressure), osteoarthritis (a degeneration of cartilage and the underlying bone within a joint), dyslipidemias (increased levels of cholesterol or triglycerides), type 2 diabetes, coronary heart disease (the nation’s number one killer), stroke, gallbladder disease (especially gall stones), sleep apnea and other respiratory problems, gastro-esophageal reflux (GERD) and some cancers (particularly those associated with estrogen production such as malignancies in endometrial lining of the uterus, as well as breast and ovarian cancers). There is also a higher prevalence of colon CA in obese people. Every one of those diseases will become an increasingly greater problem if the current trends in obesity are not brought under control. With someone else paying the bill for the care of those diseases, there is little motivation for behavioral alterations such as following prudent diets and engaging in increased amounts of exercise. Imagine what will happen to the over all health of our nation’s citizens if the next 24 years brings another 15% rise in the incidence of obese adults, as it did between 1980 and 2004. The proposed National Health Care system will neither encourage changes in behavior nor will it be able to sustain the exorbitant cost of medical care of that large number of people apart from drastic increases in taxation or rationing the accessibility of services.
Obesity is defined as having a body mass index (BMI) greater that 30. Morbid obesity is further identified by attaining a BMI greater than 40. A BMI between 25 to 29 is considered being over weight. One can calculate one’s BMI by taking one’s height in inches, squaring that number (I.e. 68 times 68 if one is 5 ft 8 in. tall) and dividing that figure into one’s weight in pounds. That figure (a fraction) is then multiplied by a standard 703. The figure thus produced is then one’s BMI. For example a 5 ft 8 in tall person who weighs 160 lbs would compute his/her a BMI as follows: 68 x 68=4,624. 160 divided by 4,624=.035. .035 x 703 = 24.6. Thus that person is considered to be of a maximum normal weight for height.
The prevalence of morbid obesity was 4.7 percent in the year 2000, according to the latest published figures from the Center for Disease Control; up from 2.9 percent observed in a national data set obtained from 1994. From 2000 to 2005, the prevalence of obesity (BMI over 30 but less than 40) increased by 24%. However, the prevalence of a BMI over 40 (morbid obesity) increased by 50% and the prevalence of a BMI over 50 increased by 75%, two and three times faster respectively, than simple obesity. Given those trends and the numerous diseases and disabilities that result there from, one can readily see that a national healthcare system, where people are not responsible for paying the bills for their expensive medical care, will result in taxations that will markedly alter the current life styles of the citizens of middle America. This is not going to be just a “tax the rich” scenario.
In 2006, 20.8% (45.3 million) of U.S. teens and adults were then admittedly cigarette smokers; of those, 80.1% (36.3 million) smoked every day, and 19.9% (9.0 million) smoked some days. The prevalence of cigarette smoking further varied substantially among population subgroups. By sex, prevalence was higher among men (23.9%) than women (18.0%). Among racial/ethnic groups, Asians had the lowest prevalence (10.4%). Hispanics had a significantly lower prevalence of smoking (15.2%) than American Indians (32.4%), as well as non-Hispanic blacks (23.0%), and non-Hispanic whites (21.9%). Smoking prevalence also varied by level of education. Smoking pervasiveness was highest among adults who had only earned a General Educational Development (GED) diploma (46.0%) and those with 9 to11 years of education (35.4%); overall, smoking popularity was found to be inversely proportional to one‘s years of post high school education. By age differential, adults aged 18 to 24 years and 25 to 44 years had the highest incidence of smoking (23.9% and 23.5%, respectively). The inevitability of current smoking was higher among adults living below the federal poverty level (30.6%) than among those at or above this level (20.4%). At a cost of approximately $4.00 per pack, that can only be defined as abject foolishness. Cigarette smoking causes cancer of the lung, mouth, kidney, bladder and other regions as well. It is the main cause of emphysema (95%) and a major risk factor in peripheral vascular disease, heart attacks and stroke. With the ill effects of second hand smoke, even non-smokers who live with those who smoke will suffer from certain tobacco related conditions that will also add to the cost of the federal budget’s national health care bill.
The bad habits and destructive life styles in which some American’s have chosen to engage themselves, and the costly diseases that result from those habits are factored into the price that the rest of us pay in our insurance premiums. If we have HSA’s and catastrophic insurance (as suggested in a previous article), the premiums for which are based upon the risks imposed by smoking and obesity, those with destructive behaviors will have to pay for their choices. As Americans we are free to choose but for too long now we have failed to teach the hard, but axiomatic lesson that bad choices also incur bad consequences.
If we once again become a nation that uses the consumer driven, free enterprise system of health care, as it had been practiced before Medicare was instituted in 1965, then eventually people will see that their physically destructive behavior can affect their Health Savings Accounts (HSA) in a negative way. Those who smoke a pack per day could instead contribute the $120 per month spent on tobacco to their HSA, thus enabling it to grow that much higher; and by stopping smoking the need for expending the HSA monies will also drop off precipitously because of the lowering of the incidence of tobacco related disease. Fewer stops at fast food facilities basis will likewise assist in shrinking one’s waste line, thus ceasing its growth and instead adding to the growth of their health savings bank account.
Tuesday, August 19, 2008
Adjunctive Therapy
In addition to the exorbitant costs that HMOs have engendered in the delivery of health care, two other factors, ones that may be more difficult, but not impossible, to solve, include the high cost of prescription drugs and excessive malpractice premiums.
In the July 5, 2008 edition of the Youngstown Vindicator Mr. Ernie Brown wrote, “The next president of our country will again have to deal with the seemingly impossible problem to solve — providing low-cost, quality health care to millions of Americans who are without that coverage.” As I have shown over that past several weeks, the “seemingly impossible” ailments currently suffered by our health care systems are not “impossible…to solve” but are definitely curable by means of a surgical excision of the primary problematic system (that means we cut out the middle, bureaucratic HMO layer that costs so much) and through the reinstitution of that delivery system which worked so well prior to the federal government’s 1965 introduction of Medicare and the insurance industry’s patently obvious mismanagement of healthcare; that reinstituted delivery system is what is generally known as that good old fashioned, American style of business called free enterprise. Doing that will drive down the cost of care and make even the uninsured better able to cope. Today we will discuss two other, post-operative, adjunctive therapies for treating our ailing system of health care.
In Mr. Brown’s article he alluded to “A 2005 story from The New York Times (that) says 10 major pharmaceutical companies joined in (what they termed) Together Rx Access to cut 25 to 40 percent from the retail prices of prescription drugs sold to uninsured people of modest means younger than 65.” Parenthetical remarks were mine. He went on to say that “ Roba Whiteley, executive director of Together Rx, said, ‘We are in a difficult moment right now in our economy, and if people can know about saving money on their prescription medicine, that will be a big help.”’ Mr. Brown also pointed out the fact that “one in five black adults is uninsured, which accounts for 6 million people in the U.S. More than one in three Hispanics does not have health or prescription insurance. Although the majority of Hispanics work, they are less likely to have health coverage as they may be recent immigrants or employed in low-wage jobs with no benefits.” Also according to Mr. Brown, “the companies participating in Together Rx Access are Bristol-Myers Squibb Co., Glaxo-Smith-Kline, and Pfizer.”
If the pharmaceutical companies can afford to supply lower cost drugs to minorities, why not also provide medications to those other people in the US who also work but whose middle class incomes do not afford them the luxury of having a reduction in their drug bill? There are ways that the pharmaceutical industry can cut the fat out of their business practices and pass those savings on to the customers. Of first importance is advertising. That used to come strictly by way of pharmaceutical representatives (I.e. salespersons) who called on doctors during office hours and informed them of the latest advancements in their product line. While that method is still in practice, an extremely irritating, offensive and quite expensive form of advertising is also being used; namely through the television and radio media. Drug companies also flood medical journals with page after page of advertisements. There is nothing that frustrates a physician more than having a patient come in to the office having made his or her own diagnosis and demanding a prescription for that alleged condition. The commercials promoting drugs to treat erectile dysfunction are not only unnecessary (since anyone with that condition will seek the counsel of his physician), they are also in extremely bad taste, given the fact that they appear on the screen during prime time, suggesting a private love making episode when young folks are sitting with their parents or grandparents watching a sporting event (and not the one being suggested by the ED commercials). While watching the Golf Channel last Sunday afternoon I saw three separate ED drugs (Cialis, Viagra and Levitra) being advertised in a span of 60 minutes. Another, equally offensive product promotion concerns the drugs that are used to treat the sexually transmitted disease known as herpes simplex. Drug companies likewise advertise specific cholesterol lowering agents, treatments for athletes foot and drugs to shrink the prostate; just to name a few. During 2004, the U.S. pharmaceutical industry spent 24.4% of its 235.4 billion sales dollars on advertising, versus 13.4% for research and development, as a percentage of US domestic sales of US. Thus 57.4 billion dollars were utilized on ads. Consider how much they could have reduced the cost of drugs if they had expended only half that much.
The pharmaceutical companies used to offer certain perks to doctors, such as a free dinner out with one’s spouse while being lobbied after dinner by the pharmaceutical representative as he or she promoted a new miracle drug soon to be released. Weekends in a luxurious hotel, all expenses paid, were formerly offered as were various items to be used in practice from pen and pencil sets to blood pressure cuffs to stethoscopes. Thankfully, very little of that goes on any more but there are still some unnecessary perks that could be eliminated in order to reduce of cost drugs to the consumer. According to an article appearing in the 8-13-08 issue of JAMA, the pharmaceutical industry spent $168 million on lobbying members of Congress in 2007 and $20 million on campaign contributions, a sum exceeding that of any other industry. The number of employed pharmaceutical lobbyists in 2000 was 625, more than one for each member of Congress. An analysis of official lobbying disclosure records by other agencies, found that the industry recruited high-priced talent, paying individual lobbyists on average more than $12,000 a month. The issues of concern to the drug industry involved, patent protection, blocking the importation of less expensive drugs and ensuring greater market access in international trade agreements. In regard to patent protection, once the particular company has recouped its costs for research and development of a particular pharmaceutical agent, only the cost of producing it plus a reasonable profit margin should be passed on to the consumer; by reducing the cost to that which is competitive with generics, patent protection will become a moot point. By limiting the amount they spend on lobbyists and advertising, patients would benefit greatly. There ought to be a cap placed on those spending issues.
A second method for reducing the cost of healthcare would be to institute tort reform. Tort reform refers to the idea of changing the rules applicable to the laws of tort. Tort deals with compensation for wrongs and harm done by one party to another's person, property or other protected interests (e.g. reputation, under libel and slander laws). The most contentious area in question has to do with tort reform which advocates its focus in personal injury and that specifically involves malpractice insurance. There needs to be a cap placed on allowed damages and those attorneys and their clients who file frivolous suits, that either never make it to court or are lost in a trial, need to be held accountable for capricious acts and thus required to pay reciprocal damages to the physician to cover his/her legal expense, time lost from practice and reputation damaged. If that is the case they will think twice before taking a physician to court. As tort law stands now, the suing patients and the lawyer representing them are in a no risk situation; they have nothing to lose in filing a suit.
A 2005 study by Dartmouth College researchers suggests that huge jury awards and financial settlements for injured patients have not caused the explosive increase in doctors' insurance premiums. The researchers said a more likely explanation for the escalation is that malpractice insurance companies have raised doctors' premiums to compensate for falling investment returns in other market areas. If that is so, the practice is what one calls highway robbery. When I started my practice in 1967, malpractice suits were rare occurrences and I paid a mere $300 per year for $100,000 (single event) and $300,000 aggregate coverage. When I retired in 1998, having never been sued, my malpractice insurance premium had risen to $7,000 per annum for one million (single event) and two million (aggregate) coverage. Now an internist, the lowest physician on the scale of risk, pays as much as $25,000 annually for the same coverage and OB/GYN physicians in Dade County Florida pay $250,000 per year. That is because the current law states that an obstetrician can be sued until a person reaches the age of 21 if any ailment up to that point can be shown to have been caused by the pre-natal care and/or delivery. Not only does part of the cost of that high premium get passed on to the patient, but the doctor is forced to practice defensive medicine and order a lot more tests to cover his or her potential liability than would otherwise be needed. A urologist friend of mine was once sued by an insurance salesman who had been kept waiting in the physician’s office because of an unforeseeable, surgical emergency. He sued for the loss of an insurance policy sale because he had missed a previously scheduled appointment with a potential client. Believe it or not the litigant won the case, because the surgeon’s malpractice insurer settled out of court.
Thus, if we rid the system of the multilayered, business oriented HMOs, promote entrepreneurship, encourage workers to invest in health savings accounts and purchase catastrophic insurance, each one paid for by non-taxable dollars coming from an employer who had previously sent that same amount of money to a HMO, if we insist that pharmaceutical companies reduce their overhead by eliminating counterproductive advertising, if we further insist that our legislators bring about tort reform and return medicine to its pre-1965 state of free enterprise with a consumer (patient) driven cost structure, then quality, consumer friendly and affordable health care will be the result for those who are insured as well as those who are not.
In the July 5, 2008 edition of the Youngstown Vindicator Mr. Ernie Brown wrote, “The next president of our country will again have to deal with the seemingly impossible problem to solve — providing low-cost, quality health care to millions of Americans who are without that coverage.” As I have shown over that past several weeks, the “seemingly impossible” ailments currently suffered by our health care systems are not “impossible…to solve” but are definitely curable by means of a surgical excision of the primary problematic system (that means we cut out the middle, bureaucratic HMO layer that costs so much) and through the reinstitution of that delivery system which worked so well prior to the federal government’s 1965 introduction of Medicare and the insurance industry’s patently obvious mismanagement of healthcare; that reinstituted delivery system is what is generally known as that good old fashioned, American style of business called free enterprise. Doing that will drive down the cost of care and make even the uninsured better able to cope. Today we will discuss two other, post-operative, adjunctive therapies for treating our ailing system of health care.
In Mr. Brown’s article he alluded to “A 2005 story from The New York Times (that) says 10 major pharmaceutical companies joined in (what they termed) Together Rx Access to cut 25 to 40 percent from the retail prices of prescription drugs sold to uninsured people of modest means younger than 65.” Parenthetical remarks were mine. He went on to say that “ Roba Whiteley, executive director of Together Rx, said, ‘We are in a difficult moment right now in our economy, and if people can know about saving money on their prescription medicine, that will be a big help.”’ Mr. Brown also pointed out the fact that “one in five black adults is uninsured, which accounts for 6 million people in the U.S. More than one in three Hispanics does not have health or prescription insurance. Although the majority of Hispanics work, they are less likely to have health coverage as they may be recent immigrants or employed in low-wage jobs with no benefits.” Also according to Mr. Brown, “the companies participating in Together Rx Access are Bristol-Myers Squibb Co., Glaxo-Smith-Kline, and Pfizer.”
If the pharmaceutical companies can afford to supply lower cost drugs to minorities, why not also provide medications to those other people in the US who also work but whose middle class incomes do not afford them the luxury of having a reduction in their drug bill? There are ways that the pharmaceutical industry can cut the fat out of their business practices and pass those savings on to the customers. Of first importance is advertising. That used to come strictly by way of pharmaceutical representatives (I.e. salespersons) who called on doctors during office hours and informed them of the latest advancements in their product line. While that method is still in practice, an extremely irritating, offensive and quite expensive form of advertising is also being used; namely through the television and radio media. Drug companies also flood medical journals with page after page of advertisements. There is nothing that frustrates a physician more than having a patient come in to the office having made his or her own diagnosis and demanding a prescription for that alleged condition. The commercials promoting drugs to treat erectile dysfunction are not only unnecessary (since anyone with that condition will seek the counsel of his physician), they are also in extremely bad taste, given the fact that they appear on the screen during prime time, suggesting a private love making episode when young folks are sitting with their parents or grandparents watching a sporting event (and not the one being suggested by the ED commercials). While watching the Golf Channel last Sunday afternoon I saw three separate ED drugs (Cialis, Viagra and Levitra) being advertised in a span of 60 minutes. Another, equally offensive product promotion concerns the drugs that are used to treat the sexually transmitted disease known as herpes simplex. Drug companies likewise advertise specific cholesterol lowering agents, treatments for athletes foot and drugs to shrink the prostate; just to name a few. During 2004, the U.S. pharmaceutical industry spent 24.4% of its 235.4 billion sales dollars on advertising, versus 13.4% for research and development, as a percentage of US domestic sales of US. Thus 57.4 billion dollars were utilized on ads. Consider how much they could have reduced the cost of drugs if they had expended only half that much.
The pharmaceutical companies used to offer certain perks to doctors, such as a free dinner out with one’s spouse while being lobbied after dinner by the pharmaceutical representative as he or she promoted a new miracle drug soon to be released. Weekends in a luxurious hotel, all expenses paid, were formerly offered as were various items to be used in practice from pen and pencil sets to blood pressure cuffs to stethoscopes. Thankfully, very little of that goes on any more but there are still some unnecessary perks that could be eliminated in order to reduce of cost drugs to the consumer. According to an article appearing in the 8-13-08 issue of JAMA, the pharmaceutical industry spent $168 million on lobbying members of Congress in 2007 and $20 million on campaign contributions, a sum exceeding that of any other industry. The number of employed pharmaceutical lobbyists in 2000 was 625, more than one for each member of Congress. An analysis of official lobbying disclosure records by other agencies, found that the industry recruited high-priced talent, paying individual lobbyists on average more than $12,000 a month. The issues of concern to the drug industry involved, patent protection, blocking the importation of less expensive drugs and ensuring greater market access in international trade agreements. In regard to patent protection, once the particular company has recouped its costs for research and development of a particular pharmaceutical agent, only the cost of producing it plus a reasonable profit margin should be passed on to the consumer; by reducing the cost to that which is competitive with generics, patent protection will become a moot point. By limiting the amount they spend on lobbyists and advertising, patients would benefit greatly. There ought to be a cap placed on those spending issues.
A second method for reducing the cost of healthcare would be to institute tort reform. Tort reform refers to the idea of changing the rules applicable to the laws of tort. Tort deals with compensation for wrongs and harm done by one party to another's person, property or other protected interests (e.g. reputation, under libel and slander laws). The most contentious area in question has to do with tort reform which advocates its focus in personal injury and that specifically involves malpractice insurance. There needs to be a cap placed on allowed damages and those attorneys and their clients who file frivolous suits, that either never make it to court or are lost in a trial, need to be held accountable for capricious acts and thus required to pay reciprocal damages to the physician to cover his/her legal expense, time lost from practice and reputation damaged. If that is the case they will think twice before taking a physician to court. As tort law stands now, the suing patients and the lawyer representing them are in a no risk situation; they have nothing to lose in filing a suit.
A 2005 study by Dartmouth College researchers suggests that huge jury awards and financial settlements for injured patients have not caused the explosive increase in doctors' insurance premiums. The researchers said a more likely explanation for the escalation is that malpractice insurance companies have raised doctors' premiums to compensate for falling investment returns in other market areas. If that is so, the practice is what one calls highway robbery. When I started my practice in 1967, malpractice suits were rare occurrences and I paid a mere $300 per year for $100,000 (single event) and $300,000 aggregate coverage. When I retired in 1998, having never been sued, my malpractice insurance premium had risen to $7,000 per annum for one million (single event) and two million (aggregate) coverage. Now an internist, the lowest physician on the scale of risk, pays as much as $25,000 annually for the same coverage and OB/GYN physicians in Dade County Florida pay $250,000 per year. That is because the current law states that an obstetrician can be sued until a person reaches the age of 21 if any ailment up to that point can be shown to have been caused by the pre-natal care and/or delivery. Not only does part of the cost of that high premium get passed on to the patient, but the doctor is forced to practice defensive medicine and order a lot more tests to cover his or her potential liability than would otherwise be needed. A urologist friend of mine was once sued by an insurance salesman who had been kept waiting in the physician’s office because of an unforeseeable, surgical emergency. He sued for the loss of an insurance policy sale because he had missed a previously scheduled appointment with a potential client. Believe it or not the litigant won the case, because the surgeon’s malpractice insurer settled out of court.
Thus, if we rid the system of the multilayered, business oriented HMOs, promote entrepreneurship, encourage workers to invest in health savings accounts and purchase catastrophic insurance, each one paid for by non-taxable dollars coming from an employer who had previously sent that same amount of money to a HMO, if we insist that pharmaceutical companies reduce their overhead by eliminating counterproductive advertising, if we further insist that our legislators bring about tort reform and return medicine to its pre-1965 state of free enterprise with a consumer (patient) driven cost structure, then quality, consumer friendly and affordable health care will be the result for those who are insured as well as those who are not.
Tuesday, August 12, 2008
When in Doubt, Cut It Out.
One of my friends, a surgeon and a colleague, has a favorite axiom that he has frequently used in deciding upon the proper care of an acutely ill person who presents with increasing right lower abdominal pain; “When in doubt, cut it out.” Sometimes that which the surgeon excises requires the addition of something to replace the missing tissue or its intended function. In the illustration used above, the appendix is one exception. However, if for example a thyroid gland is removed, thyroid hormone must be prescribed to replace the missing vital metabolic substance it produced. In the case of a sick healthcare system, cutting out the offending agent is in definitely order, but we must also have a proven method of replacing that which is no longer available in the care of our citizens. Furthermore, that entity which is used to replace that diseased system that has been extirpated must have a proven track record of success. Having now diagnosed the problem, the etiology of our ailing healthcare delivery system, as being the multilayered, bureaucratic, managed care that has been provided by HMOs, all we need to do now is to “cut it out.” We must immediately remove it and replace it with a more workable system; the tried and true method of all successful American business called free enterprise.
As explained in a previous article, the HMOs with their over paid CEOs, the multiple layers of bureaucratic intrusions, the needless rules and regulations, the reams of paper work, the hours of surveillance upon the practices of physicians and their patient’s charts, plus the thousands of HMO employees needing paychecks are collectively what has caused the cost of medical care to reach unbearable levels. We were able to function quite well before those managed care organizations were put in place, separating one’s doctor from oneself, and we will be able to function just as well after they are gone. The reader may recall that the HMOs were supposed to be the cure for the increasing cost of medicine; they have resulted in just the opposite. The government planners who put those managed care organizations into place failed to realize that another bureaucracy, the federal Medicare System was the real cause for that initial, insidious rise in the cost of care between 1965 and 1980. Thus having misdiagnosed the problem, it was only natural to expect that the wrong remedy would have been implemented. Having prescribed the wrong therapy, the metaphorical patient (the delivery of healthcare) not only remained sick, the patient became critically ill, had to be sent to the intensive care unit and is now on life support. Had practicing physicians been consulted early on, the misdiagnosis would have never occurred and the deadly therapeutic mixture (the HMO fiasco) would never have been prescribed.
As an aside, one of my very wise mentors once told me that the patient would always provide me with the correct diagnosis if I simply asked the right questions. The reason that the Federal government and managed care organizations have never correctly diagnosed the problem or offered an efficacious cure is because they have failed to ask the right people (practicing physicians) the right questions. This has also been true of hospital administrators and boards of directors (on which I have served); they seldom ask the ones who really know the answers when it comes to the efficient, expedicious delivery of health care.
By excising the failing HMO organizations we can better utilize the billions of healthcare dollars being consumed by those uncaring, bottom line, business people and focus those monies, not on improving the profit margins of the insurance industry, but instead in refining the delivery of health care at a price that people can afford. The following is the scenario that will work. First the employers of our working millions take the money they now confer to the HMOs (roughly $13,000 per family) and instead give it to their employees. Federal legislation needs to be put in place so that those payroll dollars are not taxed if they are documented as having been used for the purpose of health care. The employee must verify that he/she has put half of that increase in pay into a health savings account (HSA) and that they have purchased catastrophic health insurance (CHI) with the remaining half; I.e. $5000 deductible. The employer still gets the tax deduction and the employee need not worry about paying more taxes for an increase in his or her income.
The catastrophic health insurance will cover any extraordinary hospital expense that could normally bankrupt a non-covered person. With the money in the HSA, the employee can shop for the best deal with the best doctor that will meet his self determined medical need. That is the basis of consumer driven free enterprise. Currently, neither a physician, a laboratory, a radiological facility nor a hospital receives the exact dollar amount they bill for the service they render. For example, if you are covered by Medicare and have supplemental health insurance, by simply examining your most recent bill, you will notice that the practitioner or facility charged a certain amount, while Medicare allowed only a certain percentage of that billed amount and that the supplemental insurance picked up only a portion of that which Medicare did not pay. In the case of people under the age of 65, the HMO pays much less than the bill indicates. The total of what is paid to the doctor, the hospital or ancillary facility typically amounts to less than 50% of the original charge, and in some cases it is even less. In fact, I recently read a bill that was submitted to Medicare by a sleep study specialist. The bill was $500 for interpreting the numerous bits of data that was collected while the patient was asleep over an eight hour period. Medicare paid the physician $122.87 and the patient’s co-insurance paid another $24.57. Thus the physician’s total reimbursement was $147.44 or 30% of that which he had originally billed. Therefore, by establishing new fee schedules based upon what they actually now receive under the managed care system, physicians, ancillary facilities and hospitals can immediately lower the cost to the patient but still not take a cut in their current income. The difference will be that which was formerly siphoned off by the HMO.
By using the HSA wisely, and not seeking medical care for minor problems or going to expensive, crowed emergency rooms or ambulatory health care facilities, young, relatively healthy employees will be able to accumulate quite a large sum of funds in their HSA, which also accrues interest, that will no doubt cover any extraordinary expenses in their later years that will more than off set the $5,000 deductible portion of their catastrophic health insurance. Furthermore, as this consumer (patient) driven free enterprise system is implemented and the cost of medical care falls, even those persons not covered will be better able to afford care when they really need it. After seeing that the elimination of the HMOs has improved the delivery of healthcare for the under 65 population, a similar adjustment in the Medicare delivery system can also be employed. Prior to 1965 doctors managed quite well caring for the elderly. In fact today’s over 65 senior citizens are in general, better off financially than most working younger folks who are raising families and saving for their children’s education.
Free enterprise also stimulates entrepreneurs and that will further improve the health of our nation’s health care system; this would be what we physicians call adding adjunctive therapy following surgery to remove a cancer. I can envision groups of physicians who treat similar illnesses affording their patients a one-stop shopping, specialty mall. These facilities can be built in conjunction with contractors with a similar entrepreneurial spirit. Diabetics are often treated by their primary care physician (internist or family practice physician) in cooperation with a team of other physician sub-specialists: an endocrinologist if the diabetes is particularly severe, an ophthalmologist (for eye care), a nephrologist (if renal failure ensues or dialysis is needed), a podiatrist (for foot care) and a cardiologist (heart disease being common in diabetics). Given the rising cost of travel, the diabetic would welcome having to devote an entire day in that facility to see his or her various physicians. There would no doubt also be a need for radiology and laboratory facilities as well as a coffee shop in that mall. Free enterprise stimulates the economy; socialized medicine as proposed by Senator O’Bama and other liberal minded politicians stifles it. This proposed free enterprise, which is so dearly needed, will not happen unless every citizen who finds the current cost of medical care intolerable demands that their respective, elected representatives to congress (House and Senate) change the system. If they refuse, we can offer them the same exit (and extirpation) that we are offering the HMOs, and then we will elect representatives who do have our best interest at heart. Be assured that the HMOs will be lobbying very earnestly to protect the golden egg that the proverbial goose (called managed care) has deposited in their bank accounts.
Several other remedies are needed to supplement this principal cure (a surgical excision) for our ailing health care system, the additional adjunctive therapies will be addressed in articles over the next two weeks; namely tort reform to reduce malpractice fees and unwarranted suits, the reduction of pharmaceutical costs and the essential need for every American to become more serious about his or her own general health.
As explained in a previous article, the HMOs with their over paid CEOs, the multiple layers of bureaucratic intrusions, the needless rules and regulations, the reams of paper work, the hours of surveillance upon the practices of physicians and their patient’s charts, plus the thousands of HMO employees needing paychecks are collectively what has caused the cost of medical care to reach unbearable levels. We were able to function quite well before those managed care organizations were put in place, separating one’s doctor from oneself, and we will be able to function just as well after they are gone. The reader may recall that the HMOs were supposed to be the cure for the increasing cost of medicine; they have resulted in just the opposite. The government planners who put those managed care organizations into place failed to realize that another bureaucracy, the federal Medicare System was the real cause for that initial, insidious rise in the cost of care between 1965 and 1980. Thus having misdiagnosed the problem, it was only natural to expect that the wrong remedy would have been implemented. Having prescribed the wrong therapy, the metaphorical patient (the delivery of healthcare) not only remained sick, the patient became critically ill, had to be sent to the intensive care unit and is now on life support. Had practicing physicians been consulted early on, the misdiagnosis would have never occurred and the deadly therapeutic mixture (the HMO fiasco) would never have been prescribed.
As an aside, one of my very wise mentors once told me that the patient would always provide me with the correct diagnosis if I simply asked the right questions. The reason that the Federal government and managed care organizations have never correctly diagnosed the problem or offered an efficacious cure is because they have failed to ask the right people (practicing physicians) the right questions. This has also been true of hospital administrators and boards of directors (on which I have served); they seldom ask the ones who really know the answers when it comes to the efficient, expedicious delivery of health care.
By excising the failing HMO organizations we can better utilize the billions of healthcare dollars being consumed by those uncaring, bottom line, business people and focus those monies, not on improving the profit margins of the insurance industry, but instead in refining the delivery of health care at a price that people can afford. The following is the scenario that will work. First the employers of our working millions take the money they now confer to the HMOs (roughly $13,000 per family) and instead give it to their employees. Federal legislation needs to be put in place so that those payroll dollars are not taxed if they are documented as having been used for the purpose of health care. The employee must verify that he/she has put half of that increase in pay into a health savings account (HSA) and that they have purchased catastrophic health insurance (CHI) with the remaining half; I.e. $5000 deductible. The employer still gets the tax deduction and the employee need not worry about paying more taxes for an increase in his or her income.
The catastrophic health insurance will cover any extraordinary hospital expense that could normally bankrupt a non-covered person. With the money in the HSA, the employee can shop for the best deal with the best doctor that will meet his self determined medical need. That is the basis of consumer driven free enterprise. Currently, neither a physician, a laboratory, a radiological facility nor a hospital receives the exact dollar amount they bill for the service they render. For example, if you are covered by Medicare and have supplemental health insurance, by simply examining your most recent bill, you will notice that the practitioner or facility charged a certain amount, while Medicare allowed only a certain percentage of that billed amount and that the supplemental insurance picked up only a portion of that which Medicare did not pay. In the case of people under the age of 65, the HMO pays much less than the bill indicates. The total of what is paid to the doctor, the hospital or ancillary facility typically amounts to less than 50% of the original charge, and in some cases it is even less. In fact, I recently read a bill that was submitted to Medicare by a sleep study specialist. The bill was $500 for interpreting the numerous bits of data that was collected while the patient was asleep over an eight hour period. Medicare paid the physician $122.87 and the patient’s co-insurance paid another $24.57. Thus the physician’s total reimbursement was $147.44 or 30% of that which he had originally billed. Therefore, by establishing new fee schedules based upon what they actually now receive under the managed care system, physicians, ancillary facilities and hospitals can immediately lower the cost to the patient but still not take a cut in their current income. The difference will be that which was formerly siphoned off by the HMO.
By using the HSA wisely, and not seeking medical care for minor problems or going to expensive, crowed emergency rooms or ambulatory health care facilities, young, relatively healthy employees will be able to accumulate quite a large sum of funds in their HSA, which also accrues interest, that will no doubt cover any extraordinary expenses in their later years that will more than off set the $5,000 deductible portion of their catastrophic health insurance. Furthermore, as this consumer (patient) driven free enterprise system is implemented and the cost of medical care falls, even those persons not covered will be better able to afford care when they really need it. After seeing that the elimination of the HMOs has improved the delivery of healthcare for the under 65 population, a similar adjustment in the Medicare delivery system can also be employed. Prior to 1965 doctors managed quite well caring for the elderly. In fact today’s over 65 senior citizens are in general, better off financially than most working younger folks who are raising families and saving for their children’s education.
Free enterprise also stimulates entrepreneurs and that will further improve the health of our nation’s health care system; this would be what we physicians call adding adjunctive therapy following surgery to remove a cancer. I can envision groups of physicians who treat similar illnesses affording their patients a one-stop shopping, specialty mall. These facilities can be built in conjunction with contractors with a similar entrepreneurial spirit. Diabetics are often treated by their primary care physician (internist or family practice physician) in cooperation with a team of other physician sub-specialists: an endocrinologist if the diabetes is particularly severe, an ophthalmologist (for eye care), a nephrologist (if renal failure ensues or dialysis is needed), a podiatrist (for foot care) and a cardiologist (heart disease being common in diabetics). Given the rising cost of travel, the diabetic would welcome having to devote an entire day in that facility to see his or her various physicians. There would no doubt also be a need for radiology and laboratory facilities as well as a coffee shop in that mall. Free enterprise stimulates the economy; socialized medicine as proposed by Senator O’Bama and other liberal minded politicians stifles it. This proposed free enterprise, which is so dearly needed, will not happen unless every citizen who finds the current cost of medical care intolerable demands that their respective, elected representatives to congress (House and Senate) change the system. If they refuse, we can offer them the same exit (and extirpation) that we are offering the HMOs, and then we will elect representatives who do have our best interest at heart. Be assured that the HMOs will be lobbying very earnestly to protect the golden egg that the proverbial goose (called managed care) has deposited in their bank accounts.
Several other remedies are needed to supplement this principal cure (a surgical excision) for our ailing health care system, the additional adjunctive therapies will be addressed in articles over the next two weeks; namely tort reform to reduce malpractice fees and unwarranted suits, the reduction of pharmaceutical costs and the essential need for every American to become more serious about his or her own general health.
A Community in Need Suffers the Loss of a Vital Medical Resource
In the mid 1940s, after serving his country in WWII, receiving a GI bill that would pay for his education, graduating from medical school and completing an internship in a southern university hospital, a young man returned to his home town in the mountainous district of North Carolina which is known as Appalachia. The description of his place of origin (as it appeared in the journal entitled Medical Economics) puts one in mind of the town of Mayberry in the Andy Griffith TV series. The doctor, recently married to his high school sweetheart who had become a school teacher, set up a general, family practice and provided a much needed source of medical care to his boyhood, hometown neighbors, who were for the most part financially poor by most standards. His young bride began to teach in a local rural school until their first child was born.
As time passed the young couple had two sons and a daughter, the latter ultimately going off to college to study history and the sons eventually admitted to medical school following their completion of undergraduate degrees. The daughter, following in her mom’s footsteps became a teacher, the sons, after completing their internships went on to finish residencies; one in a med-peds program which involved a combined four year program studying internal medicine and pediatrics. The other brother spent four years in the mastery of general surgery. After carrying out their post graduate training the two brothers, like their father before them, felt a calling to return to their mountain home and attend to the medical needs of the country folks in Appalachia with whom they had been raised. The year was 1975.
The internist/pediatrician became a consultant for his dad when the problems in those areas of expertise extended beyond the father’s ability to diagnose or treat them. The surgeon handled the operative problems, both emergent and elective, which neither his dad nor his brother could manage. It was a complete clinic in every respect and they had two beds for extreme emergencies until transport to a distant hospital could be arranged. The only thing lacking in their clinical practice was a local hospital. The nearest one of those was fifty miles away and that was too far to safely travel in the midst of either a medical or surgical emergency. The only solution to that predicament was to finance and build a small hospital themselves.
Within a short time, having pooled their funds and taken out a construction loan, the three physicians planned and developed a 75 bed hospital, equally divided between pediatric, medical and surgical sections. They had a laboratory, X-ray unit, emergency room, laundry, central supply, hospital pharmacy, a small business office, a waiting room and operative suite. They did not get rich, but they were able to pay off their mortgage and periodically make the necessary improvements in their small hospital and upgrade to become state of the art as medical technology became more sophisticated. Managed care had not yet poked is bureaucratic nose into their everyday practice and the people of that community were more than pleased with the service afforded to them. It was 1980.
Before long, in 1990, the managers of the Joint Commission on Accreditation of Hospitals (JCAH) who had been working for a decade on changing the way larger hospitals in metropolitan areas did business, eventually found their way to this comfortable, little Appalachian community and decided that they knew best how to serve the locals as opposed to how they had been successfully treated by the dedicated dad and ultimately his well trained sons over the previous 45 years. Year after year the JCAH nit picked away at the methods by which the three experienced physicians delivered health care. The father gradually became so frustrated that he retired and the sons began to notice that the cost of complying with the JCAH coordinator’s rules and regulations were eating into their bottom line and affecting their ability to stay afloat financially. The proverbial straw that broke the camel’s back came in 1996. The doors to the operating suite were found to be non-compliant with the hospital accreditation manager’s, capricious standards. Those were the same doors that had been swinging in and out for 26 years as the surgeon with his immaculately scrubbed and properly gloved hands held high, his mask and gown appropriately affixed, pushed through to attend to a patient in need of his surgical skills. Those doors had been swinging in as the General Practice father enetered to deliver a baby and out again as he presented the newborn child to the proud father who’d been anxiously pacing up and down in the waiting room. The JCAH had summarily declared that those doors were to be no more than 1/32 of an inch apart when closed, but they were found instead to possess a 1/16 inch gap. The JCAH team demanded that the doors be changed, and if the brothers did not comply, their hospital would be shut down.
Frustrated, nearly bankrupt and quite angry, the brothers sadly and reluctantly closed their 75 bed hospital and sold it to a man who converted it into a nursing home. Now the folks in that small town and their two excellently trained and dedicated physicians must travel 50 miles to reach the nearest hospital. Time formerly spent treating their patients must now be expended driving the serpentine roads of their Appalachian mountain region, a journey that takes at least 90 minutes one way (in good weather) to visit their patients and make daily hospital rounds. 90 minutes in the face of a medical or surgical emergency, is a very long time. It can make the difference between the continued life and the untimely death of an extremely ill patient.
This sort bureaucratic nonsense and more is what we are in for if we continue to allow the business managers in HMOs, the JCAH and government bureaucrats to control the practice of medicine. That will be especially true under a national socialized, healthcare system as proposed by Senator Barach Hussein O‘Bama. There is a workable, time proven, alternative system of delivering health care and next week we shall look at that. Finally, having diagnosed the problem and having identified the disease causing agents, we are ready to implement a cure for our ailing system of providing health care to the citizens of America.
As time passed the young couple had two sons and a daughter, the latter ultimately going off to college to study history and the sons eventually admitted to medical school following their completion of undergraduate degrees. The daughter, following in her mom’s footsteps became a teacher, the sons, after completing their internships went on to finish residencies; one in a med-peds program which involved a combined four year program studying internal medicine and pediatrics. The other brother spent four years in the mastery of general surgery. After carrying out their post graduate training the two brothers, like their father before them, felt a calling to return to their mountain home and attend to the medical needs of the country folks in Appalachia with whom they had been raised. The year was 1975.
The internist/pediatrician became a consultant for his dad when the problems in those areas of expertise extended beyond the father’s ability to diagnose or treat them. The surgeon handled the operative problems, both emergent and elective, which neither his dad nor his brother could manage. It was a complete clinic in every respect and they had two beds for extreme emergencies until transport to a distant hospital could be arranged. The only thing lacking in their clinical practice was a local hospital. The nearest one of those was fifty miles away and that was too far to safely travel in the midst of either a medical or surgical emergency. The only solution to that predicament was to finance and build a small hospital themselves.
Within a short time, having pooled their funds and taken out a construction loan, the three physicians planned and developed a 75 bed hospital, equally divided between pediatric, medical and surgical sections. They had a laboratory, X-ray unit, emergency room, laundry, central supply, hospital pharmacy, a small business office, a waiting room and operative suite. They did not get rich, but they were able to pay off their mortgage and periodically make the necessary improvements in their small hospital and upgrade to become state of the art as medical technology became more sophisticated. Managed care had not yet poked is bureaucratic nose into their everyday practice and the people of that community were more than pleased with the service afforded to them. It was 1980.
Before long, in 1990, the managers of the Joint Commission on Accreditation of Hospitals (JCAH) who had been working for a decade on changing the way larger hospitals in metropolitan areas did business, eventually found their way to this comfortable, little Appalachian community and decided that they knew best how to serve the locals as opposed to how they had been successfully treated by the dedicated dad and ultimately his well trained sons over the previous 45 years. Year after year the JCAH nit picked away at the methods by which the three experienced physicians delivered health care. The father gradually became so frustrated that he retired and the sons began to notice that the cost of complying with the JCAH coordinator’s rules and regulations were eating into their bottom line and affecting their ability to stay afloat financially. The proverbial straw that broke the camel’s back came in 1996. The doors to the operating suite were found to be non-compliant with the hospital accreditation manager’s, capricious standards. Those were the same doors that had been swinging in and out for 26 years as the surgeon with his immaculately scrubbed and properly gloved hands held high, his mask and gown appropriately affixed, pushed through to attend to a patient in need of his surgical skills. Those doors had been swinging in as the General Practice father enetered to deliver a baby and out again as he presented the newborn child to the proud father who’d been anxiously pacing up and down in the waiting room. The JCAH had summarily declared that those doors were to be no more than 1/32 of an inch apart when closed, but they were found instead to possess a 1/16 inch gap. The JCAH team demanded that the doors be changed, and if the brothers did not comply, their hospital would be shut down.
Frustrated, nearly bankrupt and quite angry, the brothers sadly and reluctantly closed their 75 bed hospital and sold it to a man who converted it into a nursing home. Now the folks in that small town and their two excellently trained and dedicated physicians must travel 50 miles to reach the nearest hospital. Time formerly spent treating their patients must now be expended driving the serpentine roads of their Appalachian mountain region, a journey that takes at least 90 minutes one way (in good weather) to visit their patients and make daily hospital rounds. 90 minutes in the face of a medical or surgical emergency, is a very long time. It can make the difference between the continued life and the untimely death of an extremely ill patient.
This sort bureaucratic nonsense and more is what we are in for if we continue to allow the business managers in HMOs, the JCAH and government bureaucrats to control the practice of medicine. That will be especially true under a national socialized, healthcare system as proposed by Senator Barach Hussein O‘Bama. There is a workable, time proven, alternative system of delivering health care and next week we shall look at that. Finally, having diagnosed the problem and having identified the disease causing agents, we are ready to implement a cure for our ailing system of providing health care to the citizens of America.
Sunday, August 10, 2008
Meet the Giant Filter at a Managed Care Organization
On May 10, 2005 an op-ed piece appearing in The Providence Journal contained a by-line which posited the question, How Can a $124.8 Million a Year CEO Make Health Care More Affordable? That is a reasonable question in deed, especially when the costs that the CEO of whom it speaks is allegedly trying to control in order to make your healthcare and mine affordable involve physicians whose incomes amount to one tenth of one percent of that which United Health Care (a Health Maintenance Organization-HMO) was paying its CEO. The short answer to the article’s question is, “He can’t!”
The commentary was a startling expose about huge pay packages for corporate CEOs in general and germane to my specific interest in this series it mentioned the awesome $124.8 million total compensation of United Health Group (parent of United Healthcare) CEO William McGuire. What the article did not include however, were two significant letters that should have followed William McGuire’s sir name; specifically M.D. You see, before becoming an HMO administrator, Dr. William McGuire, had done what I did for 31 years; he practiced internal medicine and at the time he joined United Health Care, the average taxable income of an internist was around $150,000 per year.
To view it from a United Health employee's perspective, had Dr. McGuire, who is also a United Health employee, been paid only a cool million (which was more than six times what he had previously earned in a most respectable profession), and the difference had been apportioned to United Health Care’s other employees, each of the 40,000 workers could have received an annual bonus larger than $3000. To look at it from the viewpoint of the health care system he supervises, the $124.8 million in Dr. McGuire’s total compensation, himself a single United Health Care employee (the CEO), could pay the entire salaries of 833 general internists at their current average incomes. Or, ignoring either of the previous options, the $124.8 million could fund the costs of managing one reasonable size community hospital for an entire year.
That CEO’s office only represents one layer of that massive, health management corporation‘s organizational chart. The 40,000 employees mentioned above are distributed throughout the association, in layer upon bureaucratic layer, each of which has a particular responsibility of one sort or another to supervise our heath care and improve the HMO’s bottom line. It is through those multiple layers that your doctor’s request for a procedure (therapeutic or diagnostic) must filter before his best interest in your well being can be approved, or disapproved, depending on the mood, knowledge and understanding of the filter person. A filter is commonly used to remove something that passes through it. That which is removed may be something good or bad. A colander is a type of filter which saves the good stuff, i.e. rinsed broccoli, shrimp or boiled pasta noodles. Filters on furnaces trap undesirables as do oil filters in our autos. The filtering processes at United Health Care and other HMOs separate out those procedures (diagnostic or therapeutic) that some medically untrained clerical person decides you don’t need and which would be undesirable in regard to the company’s corporate profit; the proverbial bottom line. Just remember this very important, patently obvious and painful reality; the bottom line in any HMO or MCO (Managed Care Organization) ledger is not your well being, it is sadly their financial solvency. They are out to please their own innate greed and improve the health of their stock holders‘portfolio.
One case out of the many episodes of filtering that I could cite deserves mention here. I had a 40 year old female patient who three years earlier had undergone a mastectomy and breast reconstruction because of breast cancer. She was followed periodically by her surgeon and an oncologist. One day she came to see me because of an unrelenting headache that had been present for one week. My obvious concern was the possibility of a brain metastasis; a not uncommon area for her breast cancer to spread. When I called her HMO to request permission for an MRI it was denied by a girl who asked me to spell metastasis. She said that I should try Advil for the headache, not knowing that the patient had already done that on her own for the past week. We went ahead with the MRI without the permission of the HMO and unfortunately she did have a metastatic tumor. Her husband fought and won his case for reimbursement. My experiences with the HMOs are not unique; just ask any other primary care physician.
Other layers of the bureaucracy are less obvious to the physician and the patient being covered by the HMO plan. One such stratum involves the negotiating team who meets with employers for the purpose of getting you the least health care for your employer’s dollar amount. Another layer involves those clerks and secretaries who shuffle the massive reams of paper work that go into a bureaucratic operation of this sort. Another layer involves a surveillance team that goes into physicians’ offices and determines if they are in compliance with certain inane rules and regulations established by the HMO or MCO brain trust. Those rules, one of which I will further describe, have nothing to do with the manner in which your doctor discovers the cause of and treats your medical problem.
There is an obtuse, simple-minded and insensitive rule that requires a physician to initial every laboratory and/or radiological report before it goes into a patient’s medical file; we call that “busy work” and it serves no valuable, clinical purpose. There is no requirement that insures any follow up on that report, just the presence of an initial. One HMO nurse found that I was not in compliance with that rule and so acknowledged in a statement that I received from the CEO of that particular HMO. The case in question involved a 58 year old male’s X-ray report (ordered because he had coughed up blood) in which it was declared that he had a suspicious looking mass in his left upper lung field. The patient was a smoker and I had documented the numerous attempts on my part that encouraged him to stop that dangerous, carcinogenic (cancer causing) habit. I did not initial the X-ray report but after reading it I did call the patient and arranged for him to have a CAT scan for further clarification regarding the suspicious mass. I also had him make an appointment with me for follow up. I soon received the CAT scan report, read it, did not initial it, but did discuss the need for a thoracic surgery consultation with my patient and when he gave his permission I did so. I then called the thoracic surgeon, explained the problem and asked that he see my patient expeditiously. When the pathology report came back following his lung surgery, I did not initial it either but had a documented discussion with the patient and the surgeon about a follow up visit with a radiation oncologist. When I received the oncology report outlining the planned treatment, I filed it in the patient’s chart; again I did not initial it. The patient received excellent care despite my failure to comply with United Health Care’s ridiculous rule.
Having properly managed that man’s case, without initialing his various reports, I was criticized by the CEO of that bureaucracy known as a Health Maintenance Organization for a failure to chicken scratch my initials through out his file. Had I done so, while ignoring the X-ray report in which the suspicious cancer was noted, I would have met the HMO’s requirements, while my patient would have soon met his untimely death. This is the very kind of needless bureaucratic bungling we must eliminate by reinstituting a free market, consumer driven, health care system; maintained by knowledgeable physicians, not administrative bureaucrats. We must restore a system that is free of the managers that occupy the numerous layers in the hundreds of HMOs which dot our landscape and deny our care. In coming weeks I will explain how that free healthcare market works. That is when we will explain the cure for our ailing health care system. Next week however, I want to tell you a sad tale regarding a small town practice in Appalachia. If we have national health care it will be a story that is repeated time and again, and not just in small towns, but through out the larger cities in America as well.
The commentary was a startling expose about huge pay packages for corporate CEOs in general and germane to my specific interest in this series it mentioned the awesome $124.8 million total compensation of United Health Group (parent of United Healthcare) CEO William McGuire. What the article did not include however, were two significant letters that should have followed William McGuire’s sir name; specifically M.D. You see, before becoming an HMO administrator, Dr. William McGuire, had done what I did for 31 years; he practiced internal medicine and at the time he joined United Health Care, the average taxable income of an internist was around $150,000 per year.
To view it from a United Health employee's perspective, had Dr. McGuire, who is also a United Health employee, been paid only a cool million (which was more than six times what he had previously earned in a most respectable profession), and the difference had been apportioned to United Health Care’s other employees, each of the 40,000 workers could have received an annual bonus larger than $3000. To look at it from the viewpoint of the health care system he supervises, the $124.8 million in Dr. McGuire’s total compensation, himself a single United Health Care employee (the CEO), could pay the entire salaries of 833 general internists at their current average incomes. Or, ignoring either of the previous options, the $124.8 million could fund the costs of managing one reasonable size community hospital for an entire year.
That CEO’s office only represents one layer of that massive, health management corporation‘s organizational chart. The 40,000 employees mentioned above are distributed throughout the association, in layer upon bureaucratic layer, each of which has a particular responsibility of one sort or another to supervise our heath care and improve the HMO’s bottom line. It is through those multiple layers that your doctor’s request for a procedure (therapeutic or diagnostic) must filter before his best interest in your well being can be approved, or disapproved, depending on the mood, knowledge and understanding of the filter person. A filter is commonly used to remove something that passes through it. That which is removed may be something good or bad. A colander is a type of filter which saves the good stuff, i.e. rinsed broccoli, shrimp or boiled pasta noodles. Filters on furnaces trap undesirables as do oil filters in our autos. The filtering processes at United Health Care and other HMOs separate out those procedures (diagnostic or therapeutic) that some medically untrained clerical person decides you don’t need and which would be undesirable in regard to the company’s corporate profit; the proverbial bottom line. Just remember this very important, patently obvious and painful reality; the bottom line in any HMO or MCO (Managed Care Organization) ledger is not your well being, it is sadly their financial solvency. They are out to please their own innate greed and improve the health of their stock holders‘portfolio.
One case out of the many episodes of filtering that I could cite deserves mention here. I had a 40 year old female patient who three years earlier had undergone a mastectomy and breast reconstruction because of breast cancer. She was followed periodically by her surgeon and an oncologist. One day she came to see me because of an unrelenting headache that had been present for one week. My obvious concern was the possibility of a brain metastasis; a not uncommon area for her breast cancer to spread. When I called her HMO to request permission for an MRI it was denied by a girl who asked me to spell metastasis. She said that I should try Advil for the headache, not knowing that the patient had already done that on her own for the past week. We went ahead with the MRI without the permission of the HMO and unfortunately she did have a metastatic tumor. Her husband fought and won his case for reimbursement. My experiences with the HMOs are not unique; just ask any other primary care physician.
Other layers of the bureaucracy are less obvious to the physician and the patient being covered by the HMO plan. One such stratum involves the negotiating team who meets with employers for the purpose of getting you the least health care for your employer’s dollar amount. Another layer involves those clerks and secretaries who shuffle the massive reams of paper work that go into a bureaucratic operation of this sort. Another layer involves a surveillance team that goes into physicians’ offices and determines if they are in compliance with certain inane rules and regulations established by the HMO or MCO brain trust. Those rules, one of which I will further describe, have nothing to do with the manner in which your doctor discovers the cause of and treats your medical problem.
There is an obtuse, simple-minded and insensitive rule that requires a physician to initial every laboratory and/or radiological report before it goes into a patient’s medical file; we call that “busy work” and it serves no valuable, clinical purpose. There is no requirement that insures any follow up on that report, just the presence of an initial. One HMO nurse found that I was not in compliance with that rule and so acknowledged in a statement that I received from the CEO of that particular HMO. The case in question involved a 58 year old male’s X-ray report (ordered because he had coughed up blood) in which it was declared that he had a suspicious looking mass in his left upper lung field. The patient was a smoker and I had documented the numerous attempts on my part that encouraged him to stop that dangerous, carcinogenic (cancer causing) habit. I did not initial the X-ray report but after reading it I did call the patient and arranged for him to have a CAT scan for further clarification regarding the suspicious mass. I also had him make an appointment with me for follow up. I soon received the CAT scan report, read it, did not initial it, but did discuss the need for a thoracic surgery consultation with my patient and when he gave his permission I did so. I then called the thoracic surgeon, explained the problem and asked that he see my patient expeditiously. When the pathology report came back following his lung surgery, I did not initial it either but had a documented discussion with the patient and the surgeon about a follow up visit with a radiation oncologist. When I received the oncology report outlining the planned treatment, I filed it in the patient’s chart; again I did not initial it. The patient received excellent care despite my failure to comply with United Health Care’s ridiculous rule.
Having properly managed that man’s case, without initialing his various reports, I was criticized by the CEO of that bureaucracy known as a Health Maintenance Organization for a failure to chicken scratch my initials through out his file. Had I done so, while ignoring the X-ray report in which the suspicious cancer was noted, I would have met the HMO’s requirements, while my patient would have soon met his untimely death. This is the very kind of needless bureaucratic bungling we must eliminate by reinstituting a free market, consumer driven, health care system; maintained by knowledgeable physicians, not administrative bureaucrats. We must restore a system that is free of the managers that occupy the numerous layers in the hundreds of HMOs which dot our landscape and deny our care. In coming weeks I will explain how that free healthcare market works. That is when we will explain the cure for our ailing health care system. Next week however, I want to tell you a sad tale regarding a small town practice in Appalachia. If we have national health care it will be a story that is repeated time and again, and not just in small towns, but through out the larger cities in America as well.
Friday, August 8, 2008
National Health Care is not the Answer
It must be obvious by now to all reasonable observers that the Federal Government’s control of this nation’s senior citizen healthcare through the Medicare system, the care of the indigent by means of a state controlled Medicaid organization and the supervision of the remainder of healthcare recipients’ medical issues by numerous Managed Health Organizations (MHOs) have each been a dismal failure. They were experiments doomed to malfunction from the outset because their prospective success was based upon the faulty premise that cheap healthcare would be inexpensive healthcare; cheap, in some cases for the recipient yes, but not inexpensive for the nation’s economy, the federal budget or the business community. On the contrary, when one is offered any commodity at a reduced cost, the inevitable shortages produced by the enticing bargain price cause the ultimate costs to spiral out of control; for the less economically informed it’s called the law of supply and demand.
Supply and demand is perhaps one of the most fundamental concepts of economics and it is the backbone of a capitalistic, free market, consumer driven economy. Demand refers to how much of a product or service is desired by the buyers at any given time. In this case (I.e. the context of these essays) the product is medical care. The quantity demanded is that amount of a particular sort of medical care that people are willing to buy at an affordable price; the relationship between the fee for service and the quantity of medical service demanded is known as the demand relationship; unfortunately quality of care, as we have come to discover, does not necessarily enter into the equation. Supply represents how much the market can offer; in this case how many physicians are available and how many patients each one of those doctors can effectively see per day. The quantity supplied refers to the amount of medical care that certain physicians are willing to supply when receiving a certain amount of remuneration for their service. The direct correlation between the price (physician’s fee) and the amount of a good or service (medical care) that is supplied to the market is known as the supply relationship. Price, therefore, is a reflection of supply (in this case the number of physicians available) and demand (the number of patients seeking care in their community). The price is inversely proportional to the supply and directly proportional to the demand.
Barak O’Bama and his fellow, ideologically liberal cohorts currently employed by the government are admitting the conspicuous failure of the current systems that control (I.e. manage) our healthcare simply by their patently obvious desire to change the way healthcare is delivered and to create a national (I.e. socialistic) healthcare system. They want to turn 16% of our gross domestic product (GDP), the current dollars spent on providing healthcare to our citizens, over to the same kind of people who demonstrably missed the boat when they originally declared in 1965 that the 1990 bill for Medicare would be a “mere” 9 billion dollars, when in fact it turned out to be an exorbitant 66 billion of the hard earned dollars which the average, hard working citizen pays in taxes. Our average GDP for the year 2007 was approximately 14 trillion dollars. 16% of that is two and one quarter trillion dollars.
The late George Santayana (1863-1952) wisely said, “He who fails to learn from past history is doomed to repeat it.” The past history of every country that has previously nationalized its health care system has shown it to be a predictable, pathetic and expensive failure. Consider our neighbor to the north; Canada. Why do those who can afford to pay for health care out of their own wallets flock to bordering American cities like Buffalo and Detroit when they incur a serious illness? The answer is certainly not because it is less expensive. Canadian healthcare is “free.” That is, they have already paid for it with confiscatory taxation. For example, a citizen of British Columbia earning $97,600 pays 14.7% of his or her wages in provincial tax and 26% in federal income taxation. Add to that 40.7% income tax the further sales taxes they pay on necessary commodities; they forfeit two types of sales tax on every purchase: The PST (or provincial sales tax) which in British Columbia is 7% and the GST (a federal tax on goods and services) currently at 5%. The Canadians obviously pay dearly for their “free” healthcare and so will we if Senator O’Bama has his way.
The answer to the question regarding the reason for their exodus southward, when a medical problem arises, has nothing to do with what they don’t have to pay; it has everything to do with accessibility; and especially a timely accessibility of health care. For example, in a 1990 study of the comparative availability of MRI units in the United States compared to their relative convenience in Germany and Canada revealed the following statistics: US had 2,900 units or 11.2 per million population; Germany 3.7 units per million inhabitants; Canada 1.1 units per million of its citizens. It is little wonder that the waiting period for obtaining an MRI exam is far too excessive in Canada. Compare these other 2005 statistics chronicling the two country’s respective managements of our nation’s number one killer; coronary artery disease (CAD). The number of patients with CAD undergoing investigative, diagnostic angiography was 34.9% U.S. vs. 6.7% in Canada. Those CAD patients being treated with the less invasive percutaneous transluminal coronary angioplasty was 11.7% U.S. vs. 1.5% in Canada. The numbers of CAD patients going on to have coronary-artery bypass surgery was 10.6% U.S. vs. 1.4% Canada. Those statistics are not a reflection of the incidence of CAD in the two nations but instead would suggest that the procedures are being rationed in Canada, where the patient has no out of pocket expense. The qualifications for having those procedures (I.e. the screening by age, symptoms, etc.) have weeded out more people. Canadians certainly are at no less risk for developing CAD than are Americans.
Consider this conclusion from a 2004 study, reported in the popular medical journal Circulation on September 28, 2004, comparing the relative mortality from myocardial infarction (I.e. heart attacks) in the two countries. The article was published by a collaboration of investigators from the University of Alberta, Duke University, Toronto University and the Cleveland Clinic. The conclusions read as follows: “Our results suggest, for the first time, that the more conservative pattern of care with regard to early revascularization in Canada for ST-segment elevation acute myocardial infarction may have a detrimental effect on long-term survival. Our results have important policy implications for cardiac care in countries and healthcare systems wherein use of invasive procedures is similarly conservative.” The word conservative may be interpreted as being synonymous with rationing in a socialistic system such as that planned by Senator Barak H. O‘Bama.
The law of supply and demand states that, other factors being equal, the lower the price of a good, the more people will demand that good (in this case medical care). In other words, the lower the price (in national health care it is zero), the higher the quantity demanded. The amount of a good that buyers purchase (I.e. healthcare) at a lower price (or at no immediate cost to the patient in a national health care system) is more because as the price of a good goes down, the opportunity of buying that good increases. As a result, people will naturally overuse a product that is free and which will not force them to forgo the consumption of something else they value more; like food, recreation, clothes or entertainment. When the demand for medical care exceeds the medical community’s ability to provide it (I.e. the supply), shortages and rationing will inevitably occur; it‘s not rocket science. That has occurred in all socialistic economies that have provided the type of delivery system proposed by first term senator Barak O‘Bama. When fewer young Americans apply for medical school because of the institution of socialized medicine, shortages will inescapably occur, and with those predictable shortages rationing of health care is sure to follow.
Rationing can be implemented in numerous ways; by reducing the number of facilities performing a service (I.e. MRI units or heart labs, as in Canada), by placing an age limit on those who qualify (I.e. no renal dialysis or coronary artery bypass if you are over age 60), or by increasing the stipulations that qualify a person for a given treatment or diagnostic procedure, such as age, number of dependants relying on your employability or co-morbid diseases that might impact the success of the treatment being requested. That is the alleged “cure” that Sen. O’Bama is offering to reverse the sick, but not yet terminally ill, state of our medical system. If he has his way, the prognosis is not good.
Next week I will explain why HMOs are costing so much and explicitly elucidate their specific role in the soaring cost of medical care to both American based industry and the citizens of the United States. Thus we will examine another pathological process affecting the ill health of the medical care delivery system in the US. Remember, a correct diagnosis must always precede any reasonable hope for a cure. Trust me when I say that a cure is available and the patient (US Medicine as we have known it in the past) need not die.
Supply and demand is perhaps one of the most fundamental concepts of economics and it is the backbone of a capitalistic, free market, consumer driven economy. Demand refers to how much of a product or service is desired by the buyers at any given time. In this case (I.e. the context of these essays) the product is medical care. The quantity demanded is that amount of a particular sort of medical care that people
Publish Post
Barak O’Bama and his fellow, ideologically liberal cohorts currently employed by the government are admitting the conspicuous failure of the current systems that control (I.e. manage) our healthcare simply by their patently obvious desire to change the way healthcare is delivered and to create a national (I.e. socialistic) healthcare system. They want to turn 16% of our gross domestic product (GDP), the current dollars spent on providing healthcare to our citizens, over to the same kind of people who demonstrably missed the boat when they originally declared in 1965 that the 1990 bill for Medicare would be a “mere” 9 billion dollars, when in fact it turned out to be an exorbitant 66 billion of the hard earned dollars which the average, hard working citizen pays in taxes. Our average GDP for the year 2007 was approximately 14 trillion dollars. 16% of that is two and one quarter trillion dollars.
The late George Santayana (1863-1952) wisely said, “He who fails to learn from past history is doomed to repeat it.” The past history of every country that has previously nationalized its health care system has shown it to be a predictable, pathetic and expensive failure. Consider our neighbor to the north; Canada. Why do those who can afford to pay for health care out of their own wallets flock to bordering American cities like Buffalo and Detroit when they incur a serious illness? The answer is certainly not because it is less expensive. Canadian healthcare is “free.” That is, they have already paid for it with confiscatory taxation. For example, a citizen of British Columbia earning $97,600 pays 14.7% of his or her wages in provincial tax and 26% in federal income taxation. Add to that 40.7% income tax the further sales taxes they pay on necessary commodities; they forfeit two types of sales tax on every purchase: The PST (or provincial sales tax) which in British Columbia is 7% and the GST (a federal tax on goods and services) currently at 5%. The Canadians obviously pay dearly for their “free” healthcare and so will we if Senator O’Bama has his way.
The answer to the question regarding the reason for their exodus southward, when a medical problem arises, has nothing to do with what they don’t have to pay; it has everything to do with accessibility; and especially a timely accessibility of health care. For example, in a 1990 study of the comparative availability of MRI units in the United States compared to their relative convenience in Germany and Canada revealed the following statistics: US had 2,900 units or 11.2 per million population; Germany 3.7 units per million inhabitants; Canada 1.1 units per million of its citizens. It is little wonder that the waiting period for obtaining an MRI exam is far too excessive in Canada. Compare these other 2005 statistics chronicling the two country’s respective managements of our nation’s number one killer; coronary artery disease (CAD). The number of patients with CAD undergoing investigative, diagnostic angiography was 34.9% U.S. vs. 6.7% in Canada. Those CAD patients being treated with the less invasive percutaneous transluminal coronary angioplasty was 11.7% U.S. vs. 1.5% in Canada. The numbers of CAD patients going on to have coronary-artery bypass surgery was 10.6% U.S. vs. 1.4% Canada. Those statistics are not a reflection of the incidence of CAD in the two nations but instead would suggest that the procedures are being rationed in Canada, where the patient has no out of pocket expense. The qualifications for having those procedures (I.e. the screening by age, symptoms, etc.) have weeded out more people. Canadians certainly are at no less risk for developing CAD than are Americans.
Consider this conclusion from a 2004 study, reported in the popular medical journal Circulation on September 28, 2004, comparing the relative mortality from myocardial infarction (I.e. heart attacks) in the two countries. The article was published by a collaboration of investigators from the University of Alberta, Duke University, Toronto University and the Cleveland Clinic. The conclusions read as follows: “Our results suggest, for the first time, that the more conservative pattern of care with regard to early revascularization in Canada for ST-segment elevation acute myocardial infarction may have a detrimental effect on long-term survival. Our results have important policy implications for cardiac care in countries and healthcare systems wherein use of invasive procedures is similarly conservative.” The word conservative may be interpreted as being synonymous with rationing in a socialistic system such as that planned by Senator Barak H. O‘Bama.
The law of supply and demand states that, other factors being equal, the lower the price of a good, the more people will demand that good (in this case medical care). In other words, the lower the price (in national health care it is zero), the higher the quantity demanded. The amount of a good that buyers purchase (I.e. healthcare) at a lower price (or at no immediate cost to the patient in a national health care system) is more because as the price of a good goes down, the opportunity of buying that good increases. As a result, people will naturally overuse a product that is free and which will not force them to forgo the consumption of something else they value more; like food, recreation, clothes or entertainment. When the demand for medical care exceeds the medical community’s ability to provide it (I.e. the supply), shortages and rationing will inevitably occur; it‘s not rocket science. That has occurred in all socialistic economies that have provided the type of delivery system proposed by first term senator Barak O‘Bama. When fewer young Americans apply for medical school because of the institution of socialized medicine, shortages will inescapably occur, and with those predictable shortages rationing of health care is sure to follow.
Rationing can be implemented in numerous ways; by reducing the number of facilities performing a service (I.e. MRI units or heart labs, as in Canada), by placing an age limit on those who qualify (I.e. no renal dialysis or coronary artery bypass if you are over age 60), or by increasing the stipulations that qualify a person for a given treatment or diagnostic procedure, such as age, number of dependants relying on your employability or co-morbid diseases that might impact the success of the treatment being requested. That is the alleged “cure” that Sen. O’Bama is offering to reverse the sick, but not yet terminally ill, state of our medical system. If he has his way, the prognosis is not good.
Next week I will explain why HMOs are costing so much and explicitly elucidate their specific role in the soaring cost of medical care to both American based industry and the citizens of the United States. Thus we will examine another pathological process affecting the ill health of the medical care delivery system in the US. Remember, a correct diagnosis must always precede any reasonable hope for a cure. Trust me when I say that a cure is available and the patient (US Medicine as we have known it in the past) need not die.
Wednesday, August 6, 2008
Bureaucratic Managers
The average American citizen is utterly unaware of the multiple levels of bureaucratic managers and their respective underling work force that siphon off the dollars that he, she or their employer spend on health care. Even if one happens to be fortunate enough to work for a company that pays the premium, at the end of the day, every worker eventually shells out because the healthcare dollars spent by industry are monies that could otherwise have gone toward the take-home income of the employees; whether they are salaried or hourly wage earners.
There used to be an assumed, unspoken patient/doctor contract in force whenever we had to seek medical care by making a visit to a physician’s office. There were few, if any complaints about the $7.00 office fee that I charged back in 1967. But when the so-called Health Maintenance Organizations (MCO) took over the healthcare system, the patient and his or her doctor were suddenly out of the loop. The MCO negotiators met with the business executives and their employee’s union representatives and the healthcare contract was settled to the satisfaction of the union, the employer and the MCO. The patient and the physician had no voice in the matter what-so-ever and furthermore the patient’s personal physician may not have even been included in the HMO’s panel of “primary caregivers,” as we ultimately were called. The patient was thus forced to seek medical care elsewhere, attended by some unfamiliar physician who did not know them as well as their personal doctor had.
A large survey of companies, performed in September of 2007, indicated that that the average healthcare plan for a family of four costs an employer $12,100, with payment almost evenly divided between the employer and employee. The price tag of an insurance plan for a single employee was $4,400. Average premiums increased 7.2% for all plans in 2007. That was at a time when the median, net income of physicians was dropping due to the increasing costs of practice without a subsequent increase in reimbursement from Medicare or the HMOs. The 7.2% increase in dollars spent by the combined efforts of the employer and worker obviously went to fund the multiple layers of bureaucratic management. In fact, since the institution of the MCOs, that were allegedly put in place to stem the rising cost of medical care (which at the time had been erroneously attributed to the wasteful misappropriation of monies by those of us in the practice of medicine), the costs of medical care have risen in a logarithmic progression while the net, take home pay of physicians has steadily fallen. The cost of a medical practice continually rises due to increased malpractice fees, cost of goods and office supplies, utilities and employee salaries, while the reimbursement for physician services has been gradually pared away by both the federal government‘s Medicare plans and the MCOs.
For example, when I retired from active practice in 1998, having never been sued, my malpractice premium was $7,000 per annum; when I started practice in 1967 it was less than $300/yr. As an internist I and my fellow internists were at the bottom of the risk scale; while plastic surgeons and obstetrician/gynecologists lead the pack and paid 10 times that much in annual premiums. Now an internist pays $25,000 per year, while remaining at the bottom of the scale of risk and an obstetrician in Dade Florida paid as much as $270,000/yr in 2004. My employees expected and received an annual increase in salary and that also involved an increase in my contribution to their 401K plan which was based upon their base salary.
There has been a perpetual cost shift in the medical economic paradigm. The physicians who invested many years of their lives to learn the art and science of medicine and surgery, who do the tireless, conscientious, dedicated hands-on care in their attempts to point the health of our citizens in a positive direction, have been deprived of a portion of their income while that fraction, plus the steady increase in insurance premiums every year, go to line the pockets of the MCO administrators and their employees. As long as that trend continues, we will see the cost of medical care parallel the cost of driving our cars to receive that care. Furthermore, fewer young men and women in our nation will seek entrance to medical school and study to practice in the profession I love so dearly.
MCOs, being bureaucrats, have to find a way to justify their existence. They do that by adding rules and regulations that have little or nothing to do with the quality of care that you and I receive. If the truth be known, given the time those rules and regulations take from a physician’s work day, they may actually have the opposite effect. Physicians and hospitals have had to hire additional help to handle the paper work and address the countless regulations which have been built into the MCO and Medicare plans. When I entered into a year of internship and three years of residency in internal medicine at what was then known as the Youngstown Hospital Association, that fine institution had 1000 beds and residencies in internal medicine, surgery, family practice, pediatrics, radiology, anesthesiology and pathology. It also had a school of nursing and training for radiology technicians. We were the tenth largest, teaching, community hospital in the country. During my intern year, 1961-62, we had one chief administrator and a medical director and they shared the same secretary. The hospital ran like a clock and medical care was excellent. After two years on active duty with the USAF and during my residency in 1964 through 1967, I saw more and more administrators added to the mix and when Medicare finally impacted the hospital in 1967, with all of its rules and regulations, the three piece suits (administrative staff), records clerks, secretarial help, etc. rose in direct proportion to the increasing number of people who signed up for the federal government health program. Needless to say, when the MCOs began there was a concomitant and exponential rise in numbers of administrators and clerical help. Even the nurses, who used to spend most their time attending to the patients with tender, loving care, were required instead to spend a majority of the work shift filling out paper work. Where once we saw registered nurses assisting patients in their rooms, we eventually saw them spending more time writing in the patient’s chart while sitting at a desk. National health care will further exaggerate all of the current bureaucratic interference without improving our medical care one iota.
While I have entitled this series “Solutions to the Rising Cost of Healthcare,” being an internist I have learned to seek the cause of a problem (that’s called diagnosis) before prescribing the means to evoke its cure; I.e. the solutions. The recommendations for curing the problem will be forth coming but first we must identify the disease process that got our system to be as sick as it obviously is. Next week, we will look at that O’bama plan for nationalizing healthcare in more detail and as you will see, it is not a solution. If anything it will exacerbate the issues that caused the best medical care in the world to suffer from its debilitation in the first place.
Monday, August 4, 2008
There are Solutions to the Rising Cost of Healthcare
Free enterprise is one of the utmost benefits of democratic republic; and that form of government is what our founding fathers established. Consumer driven free enterprise may even be, not just the greatest stimulus to the maintaining of a democratic society but also, the means by which we preserve the reasonable health of a nation‘s economy. As individuals taste the freedom that comes from our democratic system, they are inclined to feel free to start their own businesses; they become entrepreneurs. Throughout the 232 years since our founders broke away from the suppressive control of the British monarchy and established, as Lincoln said at Gettysburg, “a new nation, conceived in liberty,” free enterprise, especially deriving from the small business community, has been the mainstay of the wealthiest nation on earth; the United States of America.
Beginning in 1965 the nation’s healthcare system began an insidious and persistent slide away from the economic principle of free enterprise; a decline that has brought it to its present state of subservience to the business community (namely HMOs established by insurance companies) and the state and federal governments. 1965 was a time when President Lyndon B. Johnson signed Medicare into law, congress having been contemplating the legislation since the 1961 letter that President John F. Kennedy had sent to them recommending health insurance for the elderly under the Social Security Act. The alleged purpose of handing the reins of the practice of medicine over to the federal government was to enable all senior citizens to obtain affordable healthcare. As with most collectivist, liberal ideas, it has had the opposite effect of that which was promised.
When the Medicare program was inaugurated in 1965, the federal government projected that Part A—the segment of Medicare that pays for hospitalization—would cost $9 billion by the year 1990. The program’s actual cost that year was $66 billion. Thus we find that, after inflation, the cost of Medicare was 165 percent higher than the government had predicted it would be. Is anyone surprised by that? When the figures had come in, a sane person would have immediately seen the failure of the government controlled health care system and turned the health and welfare of the senior citizens back to where it had been in 1965; the hands and brains of private physicians. But then, insanity is defined repeating the same errors while fully expecting a different result.
When I entered the practice of internal medicine in 1967, health insurance companies (Such as Blue Cross and Blue Shield), and the government controlled Medicare plan, each required that a patient had to be admitted to a hospital before they would pay for certain radiological testing; upper gastrointestinal X-rays and barium enema examinations for example. We physicians thought that the restrictions were both inane and unnecessarily expensive. It meant that the cost of a patient’s X-ray would also have to include at least one night’s stay in the hospital, paying for room and food, as well as a minimum amount of laboratory work that an admission to a hospital required. Furthermore it necessitated payments to nurses, orderlies, nurse’s aids, dietary personnel, lab technicians, administrative personnel and housekeeping workers, not to mention the doctor’s fee for making at least one hospital visit and performing a complete physical examination. All of those costs could have been avoided if someone in the world of business and politics, had simply taken the sage advice from those of us who really new how to run a healthcare system. That is just one example of the unnecessary, financial waste that one finds in a bureaucratic system of big business and government.
Despite the failures in the Medicare system, the new “control freak” on the block would be the brainchild of the Nixon administration in 1971 and what would become known as managed healthcare. The plan would see to it that planning grants would be issued to HMOs (health maintenance organizations) such that by 1980, 90% of the US citizens would be enrolled in an HMO. In fact, by 1996 there were 600 HMOs in the country and only 25% of our citizens (65 million at the time) were enrolled. Once again the impetus for the plan was to control the cost of healthcare. However, as everyone knows who pays a healthcare premium or is aware of what their employer pays on their behalf, the Nixon plan has been as dismal a failure as the Watergate break-in that brought Nixon to an infamous, embarrassed retreat from the world’s most powerful position.
The question thus arises, can we do anything to put an end to the upward spiraling healthcare costs and if so what are the alternatives? The answer is a resounding “Yes. “ Over the next several weeks of this newspaper’s Sunday edition I will attempt to explain to the reader why we have to pay so much for healthcare and that viable and reasonable solutions to the exorbitant rise in healthcare costs do exist. The answer is not to be found in a national healthcare program, as some who are running for the offices in our executive and legislative branches of the federal government would have you believe. The solution is found in that which has motivated both the success, as well as the cost control, of businesses of every stripe in this great nation. The solution is found in a consumer driven medical economy of free enterprise, a system that puts the patient in charge of what we are willing to pay and our ability to find the best doctor for the best dollar cost. It works in the world of commerce and it will also work in the world of affordable healthcare as well. I know that because I practiced medicine for a few of my early years in a world of free enterprise. While health care is a privilege and not a right under our constitution, affordable healthcare is something we should all strive for in this nation where each citizen has been “endowed by our Creator with” other “inalienable rights of life liberty and the pursuit of happiness.” It is high time that the controlling reins in the art and science of medicine should be handed back to those who really know how to run the medical system; physicians. The bureaucrats have failed us miserably.
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