nos-trum. pronunciation: \nos'-trum\. noun. Etymology: Latin, neuter of noster our, ours.
1. a medicine of secret composition recommended by its preparer but usually without scientific proof of its effectiveness.
2. a usually questionable remedy or scheme.
See here for more discussion.

Sunday, September 13, 2009

FACT CHECKING THE PRESIDENT'S ADDRESS TO CONGRESS

Here’s the summary published by FactCheck.org on the president’s address.  You can go here to see their extended analysis:  http://www.factcheck.org/2009/09/obamas-health-care-speech/

 

“Summary

  • Obama was correct when he said his plan wouldn’t insure illegal immigrants; the House bill expressly forbids giving subsidies to those who are in the country illegally. Conservative critics complain that the bill lacks an enforcement mechanism, but that hardly makes the president a liar.
  • The president said “no federal dollars will be used to fund abortions.” But the House bill would permit a “public option” to cover all abortions, and would also permit federal subsidies to be used to purchase private insurance that covers all abortions, a point that raises objections from anti-abortion groups. That’s true despite a technical ban on use of taxpayer dollars to pay for abortion coverage.
  • The president repeated his promise that his plan won’t add “one dime” to the federal deficit. But legislation offered so far would add hundreds of billions of dollars to the deficit over the next decade, according to the Congressional Budget Office.
  • The president overstated the degree of concentration in the insurance industry. He said that in 34 states the "insurance market" is controlled by five or fewer companies, but that’s true only of insurance bought by small groups, not the entire "insurance market."
  • Obama said his plan won’t “require you or your employer to change the coverage or the doctor you have.” It’s true that there’s no requirement, but experts say the legislation could induce employers to switch coverage for millions of workers.”

(FactCheck.org, Sep 10, 2009)

On illegal immigrants, the objection alleging that they will be covered (“You lie”) comes from the fact that there’s no mechanism in the bills to determine who is a legal resident when healthcare is delivered.  Also, as soon as the bill passes, the illegal immigrant supporters will file suit.  All this is academic, however; they are going to continue to receive care.  Federal law requires hospitals to treat anyone who presents to the ER.  This is why Democrats voted down amendments to enforce excluding them—it would contradict the requirement-to-treat law.  We need to press on:  so, get over it, not an issue.   I don’t know whether the President realizes this or just doesn’t know how things work.

I found two other ways that the House bill may allow coverage for abortion.  First, the Hyde Amendment, which bans public funding for abortion, purportedly applies only to funds which are under the control of Health and Human Services.  The bill establishes a different flow for a good part of healthcare reform funding.  As a corollary, the Hyde Amendment has to be re-authorized annually.  Secondly, the courts have considered abortion a “covered benefit” when the law is silent on it.  So, there’s plenty of wiggle room here to fund abortion.  I suspect Congressional Democrats know all this, and, again, this is why they defeated amendments on abortion in HR 3200.

There’s still the cost problem.  This is my biggest objection.  As I’ve written before, there is plenty of money, already in the system, for reform that would reduce cost and cover everybody…at least for 10-20 years.  We don’t need 53 new organizations and additional public funding to do it.  The President’s offer to do a pilot demonstration project in tort reform was not substantive.  I’ve seen a hundred different pilot projects during my government service.  You do them for two reasons:  either you don’t have the money to implement a program and you want to prove it works in order to get full funding, or you use it to fob off someone who’s pushing you to start a new program.  In the latter case, you do the pilot, then shelve the results; or, if they ask, drag your feet, or attempt to show the pilot didn’t work.  The first reason isn’t applicable here:  a pilot that re-coups money is not having funding problems.  So, the President’s suggestion is a political gesture only.  The data on tort reform shows it works in those states where implemented; you don’t need a pilot study.

Some commentators have noticed that the President is no longer using the term “healthcare reform”, substituting “health insurance reform.”  This is good tactics; it sounds less draconian, and gives a target that people can focus on:  the health insurance industry.   I also noted what FactCheck mentions above:  he no longer says “you can keep your plan/doctor”.  He now says “nothing in this plan requires you to change.”  That’s true, and is another good tactical change, since it seems clear that companies are already planning to dump their employees.  I suspect he knows this.

Nature note:  Did you notice the change in the number of people without healthcare insurance?  He said “30 million”.  First time I’ve heard him admit that the 47 million figure is not correct.  30 still isn’t right, but…whatever.

He’s doing better at “calibrating his words.”

But, despite my reservations, you have to hand it to the President:  29 prime time speeches on healthcare (according to one count), and more to come.  Each one is essentially the same as the last, but you have to admire the energy.  I’ve found it better to read the transcript rather than view them; it lets me concentrate on “what” he says, not “how” he says it. 

Lastly, he’s said he’s committed, and that’s something we can all believe.

Doc D

 

Friday, August 28, 2009

HEALTHCARE REFORM: FOCUSING ON THE GOALS AND THE DIALOGUE

I don’t know if you all want to see this, but I spent a lot of time doing the research and analysis. So, rather than have it go to waste, I’ll just throw it out here and you can read it or not.  IT’S WAY TOO LONG, BUT…



It only scratches the surface.  Every day I see claims from proponents and critics that don’t make sense, along with a few things that do.  I just can’t cover it all.



The overall situation on healthcare reform is as follows.  (1) What little discussion there was in the beginning over the cost and benefits of proposed plans has been drowned out by hyperbole and misrepresentation, from both sides.  More on this below.  (2)  The tactic used so successfully with cap-and-trade, to rush quickly (and poorly) written draft legislation through a one-party Congress without at least some internal reflection on its contents by supporters, much less by the critics, has created a morass of factions and split opinions.  Some of the public is losing faith.  (3) What could have been done very simply with existing resources was foregone in favor of a massive undertaking.



If you want to see more reasoned discussion, I recommend the Senate Doctors Show at http://republican.senate.gov/doctors/.  Both Senators are Republicans, but unlike the President, the President’s Health Policy Advisor, and the Secretary of Health and Human Services, they have actual experience of how patients get taken care of.  They conduct a session twice a week.



I.                    WHAT’S NEEDED



The problems to be addressed were these:  Access and cost. 

(1)     ACCESS

(a). There are millions of Americans who are chronically uninsured or under-insured.  Estimates of the number vary, but most are in the range of 8-15 million (roughly under 5%).  I’ve talked about the “47 million uninsured” figure in the past:  it includes the wealthy, those who do not desire insurance, illegal immigrants, and those who are between jobs and without insurance for (on avg) 4 months.  (RULE OF THUMB #1:  Statements by anybody who still uses the 47M figures should be discounted.  They know it’s not a valid figure, but are willing to use false data to make their advocacy stronger.)

(b). Of the remaining insured population, 80% consider their coverage and quality to be “good or excellent.”  This is ~120 million people (obviously kids don’t have insurance).

(c).  One of the lessons from the Massachusetts experience is, if you add a bunch of demand (new patients) to the system when the supply (doctors and hospitals) is unchanged, then price (healthcare costs) will go up.  Anybody who graduated from high school knows about supply and demand, and can do the arithmetic.  This is why MA is broke, many patients are experiencing delays, the state is exluding ~109,000 beneficiaries (kicking them out, “temporarily” they say), and Commonweatlh Care is raising limits on who gets financial support for their healthcare (a higher income threshold for when and how much you’re expecting to pay).  

(d) None of the Congressional bills currently under consideration deal with the supply side (doctors) realistically.  The President has said they will make more Primary Care doctors and pay them more.  Great idea, but we will see the first doctor in eight years, depending on how quickly medical schools can expand (not easy).  By that time the “doctor-deficit” will have continued to grow, and input to the provider population will need to accelerate.  Further, none of the estimates by the Administration include data from recent studies that a greater percentage of doctors are planning to leave clinical practice earlier than past generations did (the worst-case projection is 40% by the age of 55…I expect it be considerably less than that, though:  doctors are whiners).

(e)  The Massachusetts experience is also instructive in another respect, and corroborates what’s been found in other countries with single-payer systems:  when people don’t have to consider expense in order to seek medical care, they access the system (approx) twice as often.  This is human nature.  As one of the commanders in the military’s healthcare system, we were always getting beat up by the green eyeshade bureaucrats about why our population sought care 1.8 times more than the civilian population, even though a substantial part of the population was arguably more healthy than the civilians—that is, the active duty population.  My population would always say, “well, we weren’t sure we needed to see the doctor, but even if we didn’t, why not?” (RULE OF THUMB #2:  When people have no motivation to decide whether to seek medical care or not (no “skin in the game” as the media says), the decision will be to seek more.)  When the number of medical appointments available in the community is constant, then access goes down, and waiting times go up.

(f)  On the other hand , proponents of universal coverage say that all the people who are now uncovered and seeking emergency room care will, when covered, go through the primary care system and relieve demand on emergency services.  This would free up emergency resources for primary care.  While this works in principle, it didn’t in Massachusetts:  the ER’s are overflowing even more, because now it costs less, more people seek care, and they can’t get an appointment.  So, back we go to the ER…



So how do we ensure access to 5% of the population?  (1)  Add people to the system incrementally.  Current resources could absorb a percentage of the uninsured each year, spread out over several years.  Use the time to crank up more providers.  Cover the most needy first.  (2) Use triage systems and telephone consults:  the patient calls a specially trained nurse, who deals with minor issues over the phone, and arranges for a visit when the nature of the problem requires it.  This keeps things like refills and infant diet questions from taking up valuable clinical time.  I’ve done this before, successfully…there just need to be very strict safeguards in place:  if the triage nurse has ANY doubt, refer to an appt.  (3)  Make sure everybody contributes (except the disabled) to their care, even if it’s a token amount, and it doesn’t have to be money.  (RULE OF THUMB #3:  people value those things they invest in; free things are taken for granted.  If this is not intuitive for you, see the history of public housing)



None of these things are a part of the any draft legislation under consideration.



(2)     COST

(a).  It’s mind-boggling that somewhere between 70  and 100 billion dollars a year are wasted due to Medicare and Medicaid Fraud, Waste and Abuse (FWA).  I’ve written before on this, but here’s why this huge amount goes down the drain.  The Fraud division of the Centers for Medicare and Medicaid Services (CMS), has the resources to investigate less than one percent of all potential fraud and waste.  Increased funding has been denied for at least the last five years.  Bad on Congress for this…

(b)  Tort reform has been a great success in Texas.  It brought down malpractice insurance premiums between 20-50% depending on the specialty since its enactment in 2003.  Also, since 2003 Texas has the fastest growing population of physicians and scarce subspecialists in the country (before 2003, about 1000 new doctors a year…now about 3000 in 2008).  About 30 Texas counties now have obstetricians that did not before.  Malpractice suits have fallen by a third (are you surprised, based on who makes the money out of malpractice suits?).  Institutions who have recouped insurance premiums from falling liability, like Kelsey Seybold in Houston, have poured the money into new equipment, new clinics, and rural healthcare projects.



LEST YOU MISUNDERSTAND TORT REFORM:  (1) Note that patients only receive, on average, 15 cents out of every dollar of their malpractice award; the rest goes mostly to the trial lawyers.  And (2) note that the reform does not limit “economic” damages (the harm done to the patient).  It only limits “punitive” damages (that is, the money that could be awarded to punish the transgressor) to $250,000.  In the past you would see an economic award for $3M and a punitive award for $10M.  Juries did this knowing that 85% would go to the lawyer, and they wanted a way to give a substantial amount to the patient (in this example, only 2M of the 13M).  The Trial Lawyers Association has been attacking Texas tort reform unrelentingly since 2003, arguing that it cheats the patient who was harmed.   Do you buy that?   Anyway, so far, the legislature has seen the benefit of reform and has stayed the course, despite the lawyers spending millions lobbying them.  The courts have also repeatedly upheld the legislation against challenge…including the US Supreme Court.



If expanded to the entire US, it’s estimated that between $10-20B will be saved per year.  In a revealing statement this week, Howard Dean (Dem ex-Gov, and physician) said that “the enemies it would make to do tort reform would be worse than the money gained.  He’s talking about rich trial lawyers here:  the Administration (a lot of whom are lawyers) don’t want to piss them off.  That’s pretty sad:  political allies benefit over the health of Americans.



(c). Cost containment in other countries with single-payer systems is breaking down.  A few weeks ago it was reported in the London Times that Britain is facing an empty treasury for healthcare.  The National Health Service has, in response, found that there were 60,000 steroid injections given last year in GB, and decided that they will authorize payment in the coming year for only 3,000 of them.  I’ll admit that in past decades we shot people with steroids too much, but that era is over.  The patients who would have received the remaining 57,000 will suffer inappropriately, or take narcotics, or do other sub-optimal things to relieve the misery of degenerative disease.  When you look at the current draft US legislation, boards created to decide on standards for coverage and panels of experts who decide on standards for medical care, should give you pause:  not that they couldn’t be used to great benefit in a perfect, non-political world, but are they structure and staffed in such a way that they could be used perversely.  However, if Britain’s actions don’t meet your concept of “rationing,” then I give up.

(d)  Proponents of the current legislation argue that we ration care in the US already.  That’s true, we do it by price.  That needs to be addressed.  However, the government’s pockets are not deep enough to sustain future cost increases…as these other countries have found.  They can reduce reimbursement to doctors and hospitals, making them less likely to accept government patients, or reduce what things they will authorize for reimbursement.  But none of those things get at the root cause of cost increases.

(e)  While all the components of the healthcare system contribute to the rise in cost, no one part is more responsible, in my opinion.  Doctors’ incomes have been flat for 10 years.  Healthcare insurers rank 86th among all other sectors of the economy in profit.  US drug companies are almost the only ones investing in research and development of new drugs, with a fixed cost of $1-2B per medicine they develop.   For my money, the analysis done by the economist Arthur Laffer is the most fundamental about cost.  You may remember Laffer from ECON 101.  He proposed that tax rates and tax revenues form a bell curve:  increase taxes and up to a point, the government gets more money; increase further and revenue to the government starts to fall.  Almost all economists agree…they just argue over where the top of the bell curve is.  Laffer’s report is here:   http://lafferhealthcarereport.org/files/Laffer-HealthCareReport.pdf.  The short summary is that we have



a large and growing government healthcare wedge—an economic separation of effort from reward, of consumers (patients) from producers (health care providers), caused by government policies. Rising government expenditures on health care are the main factor driving the growth in the wedge. The wedge is a primary driver in rising health care costs, i.e., inflation in medical costs.



Recall that almost 50 cents of every dollar that’s spent on healthcare already comes from the government (Medicare, Medicaid, SCHIP, WAC, military, etc).  And this is exactly the situation of those other countries who are have problems with their government-run healthcare systems.  I recommend Laffer’s report.



SO, WHAT’S THE ANSWER TO ALL THIS?  We’ve got millions who need coverage, and we need to pay for it.   Let’s do a calculation.  Assume 12 million people are the target population.  Assume that if we could only recoup about 80% of the total that’s out there in fraud and waste, and tort reform.  Use a median figure for both of those, and you get (15B + 80B)X (.80) = 76 billion dollars.



Now, divide by the number of people we need to provide for and you get :   $80B / 12M  = $6,700.00 in cash to pay for each and every person OR $26,800.00 for every four persons (a “family” of four)  The current cost of healthcare in 2009 for a family of four is ~$13,000.00.



Note that this was done without taxes, without regulations, and without panels, boards, task forces, agencies, and committees.  Nor does the government need to get engaged, except to establish portability (between jobs) and administer the new coverage.  If you don’t like these two sources of revenue, there are a number of others that could pay for what we want to do.  Admittedly, my example is simplistic and maybe not practical, but the bottom line is that there’s plenty of money in the system right now without creating new government or spending a lot more.



But none of this is under discussion by the Administration or Congress.  Instead we get a massive overhaul of the entire system, with huge costs in the out-years, and if not control, at least oversight, by an institution that has failed to show that it knows how to manage anything effectively.



Oh, and one last thing.  For those who say that “opponents have not offered any alternatives, they just want to kill reform,” there are alternatives that have been offered by both Democrats and Republicans that include these elements and others.  It’s disingenuous to control what legislation can be considered and then accuse people of not offering any proposals.  (RULE OF THUMB #4:  Anyone who makes the “no other alternatives offered” argument, can’t be trusted.  They are more interested in what they’re pushing than in what’s best.)



II.                  EVALUATING THE DIALOGUE



The following is a collection of statements people have made about healthcare reform legislation.  The President is right that there’s misinformation, but he doesn’t get off scott-free in the process.



(1)     The America I know and love is not one in which my parents or my baby with Down Syndrome will have to stand in front of Obama’s “death panel” so his bureaucrats can decide, based on a subjective judgment of their “level of productivity in society,” whether they are worthy of health care.” (Sarah Palin, Facebook, 7 Aug).



This is pretty laughable, but unfortunately, rhetoric like this results in people showing up at meetings with Obama/Hitler posters.  In retrospect, I think she did it on purpose:  throw out an inflammatory statement to get visibility,  Because her follow-up Facebook note contains a more thorough and grounded criticism of end-of-life counseling.  My objection to the draft legislation is two-fold:  first, this counseling is already being done, so why ensconce it in the legislation and provide deadlines and content for what it entails.  The legislation has several pages of what must be included in the counseling.  The government doesn’t need to get into this business.  Second, it flies in the face of attempts to reassure people that no bureaucrat will come between you and your doctor:  in fact, it tells the doctor exactly what he has to counsel the patient in great detail.



The part of Palin’s statement that is quoted at the end, “level of productivity in society,” is a periphrasis of work by Dr. Zeke Emanuel, a physician who is a healthcare advisor to the President.  He was talking about how to allocate scarce resources, and made the argument that infants and the elderly should be lower in priority for those resources.  He was writing about things like organ transplantation, which have always been scarce.  But I think it’s right to suggest that he would feel no different if the “scarcity” was money for healthcare, leading to lowered priority and funding for expensive care later in life.  Scarcity won’t necessarily be confined to just organ transplants:  you’ve seen the plans for novel H1N1 vaccine, which will be “scarce” initially, and the priorities set for that situation.



(2)     Under the reform we’re proposing, if you like your doctor, you can keep your doctor.  If you like your health care plan, you can keep your health care plan.”  (President Obama, NH Town Hall, 11 Aug, and on occasions)



It’s hard for me to understand why he keeps making this statement.  For the people who have employer-based insurance (the largest segment of the industry), it may come as a surprise that they don’t control their plan:  the employer does.  And if the employer decides not to buy a plan, the employees don’t keep their plan…or their doctor.  Any new plan they enroll in may not have that doctor in its network.  The proposed legislation levies an 8% fee on employers that don’t offer insurance to their employees.  I’m being told of employers (businesses and institutions) who have already made the decision that the trade-off is in their favor to cancel their plans.  If you ran a business and 8% of an employee’s compensation is less than what you are paying in premiums and administrative costs, wouldn’t you unload that burden?  And in fact, most employers DO pay more than 8%.



I can’t give you a figure for how many people this will dump onto the market, but estimates have run from 10-100 million.  We’ll see. 



I suspect the President knows this.  He will just claim that it wasn’t him that did it…it was those evil ________ (add your favorite culprit:  insurers, employers, etc).  But, Americans aren’t stupid.  They will know that it was set up this way.  And, ask yourself why Congress chose 8%, instead of a higher figure.  I hate to say it, but these are the shenanigans we have to live with.



(3)     In answer to a question from someone who couldn’t get the medicine he needed without going trying the ones that the government would pay for, but that didn’t work, first, the President said, “It may be that it wasn’t as efficient – it wasn’t as smooth as it should have been, but the result is a good one.”



This was someone who was prescribed an expensive cholesterol-lowering drug that Medicaid had decided was unnecessary, since there were others that were less expensive.   He went through separate trials with each of the two medicines that are authorized.  My guess is that each trial was about 3 months, since it takes that long to know the full effect of the medicine.  Both didn’t work.  So, he had to go through a waiver process to obtain the original drug prescribed…which worked.  Not only had the President assured people earlier in his talk that patients “won’t have to wait in line,” he also thought that this man’s experience was a “good result.”  The example is instructive because it’s exactly how one goes about discouraging cost, and clearly puts a central decision in between this patient and his doctor.



(4)     “Prevention saves money in the long run.”  (many sources:  the President, politicians, media, even some doctors)



Prevention is good because it makes people healthier.  It usually doesn’t save money in the short run or the long run.  I’ve talked about this before:  just because you exercise and eat right, which delays the onset of arthritis or heart disease, doesn’t mean that it eliminates it forever.  You may live longer and it catches up with you later…increasing costs.



But there’s another issue:  in the short run it may not save money.  Imagine we have a test that costs X dollars, but we have to test 10,000 people before we prevent one person from getting the disease.  We did the right thing, but do you think we saved money?



There are dozens of prevention programs in the proposed legislation, with no validation of what we expect to accomplish with the investment in any of them.



(5)     “First of all, I said I won’t sign a bill that adds to the deficit or the national debt.  Okay?” (President Obama, NH Town Hall)



Once again, I’m not sure why he says this.  Everything that’s on the table is a deficit back-breaker.  You all know the Congressional Budget Office estimates; I won’t repeat them.  And this doesn’t pass the sniff test with most Americans.  There’s a healthcare pie, and people get a slice.  Now we’re going to add a bunch more people, and while we can’t make more pie, everybody is going to get the same size slice as before.  Say that again…?



(6)     “…we will do this without adding to our deficit over the next decade, largely by cutting out the waste and insurance company giveaways in Medicare that aren’t making any of our seniors healthier.”



The president has insisted that the cuts to pay for reform won’t affect Medicare “benefits,” only “insurance company giveaways in Medicare.”   In another Town Hall he referred to these as “Medicare subsidies.”  This is the biggest chunk of what he expects to gain in order to make the claim that reform won’t add to the deficit:  $238 billion.  The problem is that few realize that he is talking about the Medicare subsidy involved in the Medicare Advantage programs which provide the elderly with low cost medications.  It’s wildly popular, and 22 million have enrolled.  Further, over 40% of African-Americans over 65, and almost 30% of Hispanics over 65 are in the program:  these tend to be the lower income groups.  He believes he can cancel that program and force the drug companies to sell for much less.



Good luck with that, Buddy.  As soon as seniors figure this out….look out. 



The President has argued that the subsidy is not competitive and thus is a “giveaway”.  Unfortunately, it’s the only federal healthcare program to have come in under its projected cost. 



But, guess what happens to his no “adding to the deficit” promise if he doesn’t get the moola from canceling this program?



Here’s what I think will happen.  He will keep his promise, but when the bill lands on his desk he’ll turn to his staff and say “tell me this doesn’t add to the deficit or debt” and they will say “Yes, sir, Mr President, it doesn’t” and he will sign it.  If tasked with contrary evidence, he will just say that he doesn’t believe it.  There will be a little damage control, but the Administration will decide he can weather it.  In my military service in DC I saw this kind of thing happen over and over again.



(7)     “Private insurance companies can’t compete with the government.”  (many sources in the media, Congress, and the Administration)



Here’s a list of activities where private companies have been, or are in the processing of being, pushed out by the federal government:  Flood insurance, FHA, Fannie Mae and Freddie Mac, terrorist insurance, guaranteed college loans, the Tennessee Valley Authority.  Each area has its unique elements and pressures, but in all cases the government intervened with an “option” because it felt that private sources were not giving enough of a break, or a low enough rate to the population the government was interested in.   The federal government used its appropriation authority to fund their option at non-competitive rates, and the inevitable occurred.  The process with FHA and college loans is not yet complete; private lenders are leaving the field as we speak.  (RULE OF THUMB #5:  Where the government can exercise its authority to obtain an outcome it wants politically, it will do so.)





III References



A number of studies have been published in the last few months.   Laffer’s, above is one.  Here are a few more:















The Congressional Budget Office’s analysis of the current bill (HR 3200):  http://www.cbo.gov/ftpdocs/104xx/doc10400/07-26-InfoOnTriCommProposal.pdf



From the medical community:  http://healthcarereform.nejm.org/



The studies are mostly critical.  Most of what I saw on the positive side is not analytical.  But you can go to here to see the President’s political organization’s view:  http://www.barackobama.com/issues/healthcare/index.php.   or here for Democratic Party’s platform:  http://www.democrats.org/a/national/american_dream/affordable_health_care/.  









All of this stuff can get very confusing.   The legislation doesn’t cover illegals, although we’ll pay for them anyway when they go to the ER, since federal law prohibits turning anyone away.  There is no public funding of abortion but the courts have said that where this is not specifically excluded then it’s covered.  The numbers people toss around can always be criticized by someone else.  Legislation is drafted by Congressional staffers who are people who have a BA in political science or some related field, and know someone, so they get hired.  Many of them consider themselves experts, but aren’t.  What they are experts at, is the politics and the ideologies and leanings of their member or committee.  They are sometimes lawyers.   This is why we have such an incomprehensible mess to decipher what they’ve drafted.



I don’t know what the final result from all this will be.  Given the political pressures, the President’s need to pass “something,” the lawmakers lack of knowledge, and the Law of Unintended Consequences, I’m not optimistic that our original impulse will be realized:  cover the uninsured and reduce the cost.  It’s a simple task, really, made complex by political parties and vested interests…who want their own vision to prevail, instead of what benefits us the most.



Doc D

Friday, July 31, 2009

WHERE SHOULD I LIVE TO LIVE LONGEST? FEAR ABOUT VACCINES, AND ARE WE HELPING OR HURTING THE WORLD?

 

Update from Massachusetts

 

From my favorite experiment in universal healthcare coverage, Massachusetts, who recently had to eliminate some legal immigrants from coverage in order to keep going:  support for Commonwealth Care among the population has fallen to 1 in 4.  Note that the MA plan closely resembles the House Ways and Means bill.  See an article here:  http://www.forbes.com/2009/07/29/health-reform-massachusetts-opinions-contributors-obama-insurance.html.  While this is just a media article, data is also appearing in peer-reviewed medical journals on how big the problems are.

 

 

A Reflection on Longevity and Healthcare Quality. 

 

I keep hearing the experts claim that people live longer in other countries, therefore they have better healthcare than we do.  This has always bothered me; it’s at odds with my personal experience of healthcare here and what I’ve seen in several other countries.  Why do they all come here, if the results are less good than in their own country?  I’ve never been able to reconcile the feeling that the experts were wrong despite being convinced by the data they use to make the claim….the data seemed clear:  they DO live longer in Sweden, and France, and , etc.

 

I broke the code yesterday.  I was cruising FactCheck.org when I came across a reader’s objection to their analysis of life expectancy. The US has significantly higher rates of fatalities from violent crime and fatalities from automobile accidents.  The “experts” who were making the claim that people in other countries live longer include these statistics, which skew the data to a longer average life expectancy elsewhere.  When you extract the data on violence and car accidents from the totals for all the countries, we have the longest life expectancy in the world.  FactCheck.org admitted that this objection was true.

 

When tasked with why they included violent deaths in the total, the experts have replied that, in their opinion, those data ARE a reflection of poor healthcare in our country.  Excuse me?

 

Look, violent crime and auto accidents are problems…serious ones that need to be addressed.  But, they are not an issue of healthcare access or quality. 

 

Not everybody agrees.  FactCheck.org said, after being criticized, that “We’re not sure why accidental death would be deemed irrelevant in a discussion of health care quality, especially in light of claims about emergency care in Canada versus the U.S.  The assumption they are making is that more people die in the US from these things because the care they get--once they get to the hospital--is less good, or delayed.  But, this violates Occam’s Razor:  don’t invent reasons when the simplest answer is staring you in the face.  There are MORE violent deaths because there are MORE violent events.  And, there’s no data that says you are less likely to survive upon reaching the hospital, if injured in the US

 

For more on this, see http://blogs.wsj.com/numbersguy/does-the-us-lead-in-life-expectancy-223/

 

The lesson to be learned here is, you can’t trust anybody’s conclusion from the data…even mine.

 

 

 

Update from the Politicial Process

 

I noticed that on the same day, President Obama, Speaker Pelosi, and Senator Reid all began blaming skyrocketing healthcare costs on the insurance industry, calling them villains, and morally corrupt, etc.  It’s interesting that the previous strategy that “reform is not going to cost more” is being abandoned (wasn’t working) …along with the tactic of blaming doctors for “doing unnecessary surgery” (like taking out tonsils, as the President claimed).  Senator Reid said that insurance company profits “have increased by 450%.”

 

So I went to Yahoo! Finance and pulled up data on Net Profit Margin by industry.  Interesting stuff…  Over the last five years, across all industries, the average has been ~5%.  Some industries like Agricultural Chemicals, and Software are doing great, while Auto Manufacturers, Auto Dealers, and Auto Parts are doing poorly…duh. 

 

But for Health Care Plans it’s 3.2%.  They range from about 1.5 - 4.0%.  And Long Term Care Facilities are losing money at -3.5%.

 

So we’ll see if the new political strategy works.  I’m against demonizing any particular part of the healthcare industry.  The issues are systemic, not particular, but you hear people yelling at businesses, doctors, drug companies, hospitals, or whatever their favorite culprit is, all the time.

 

 

And While We’re Talking About High Drug Prices…

 

People complain about this all the time.  The evil drug companies and pharmacies are “breaking our backs”, and “why can’t we get drugs cheaper like in Canada?”  And “I know it doesn’t cost the drug company $1.00 a pill to make my medicine.”

 

You’ll love this:  actually the American consumer is subsidizing the Canadian system.  You should be mad at Canada, not the US drug industry.  How can that be, you ask?  Well…

 

--About 90% of all the drug research and development in the world occurs here in the US.  Only six countries account for 100% of the new drugs. 

--It costs, on average, $1-2 billion to bring a drug to FDA approval.  The approval process takes 10-15 years. 

--Only about 1 in 300 chemical compounds the drug industry starts to investigate actually end up as an approved medicine.

--Once approved, it’s very cheap to produce the pill…on the order of 10-20 cents apiece (WAG).

 

OK, a hypothetical.  You’re the CEO of ABC Pharmaceuticals.  You’ve got a product.  How do you recoup the fixed costs ($1-2B) and the production costs (20 cents a pill)?  Simple.  You charge a premium while you still have “biological exclusivity” (nobody else can make it but you), and set the price at $1.00 per pill. 

 

Here’s the interesting part:  Canada comes along and passes a law that says they will only pay 50 cents a pill for your drug.  You say to yourself:  “OK, I’m getting back my cost to produce the pill, but only part of my investment. Do I sell it to Canada?”  The answer is yes, because you are getting at least some of your investment back:  if you don’t, you get none.

 

So, how do you solve your business problem?  Again, simple.  You go back to the free market in the US and raise the cost even further, to $1.50 a pill, until you lose rights to the drug, or recoup your costs…then, you drop the price.

 

When you, the US patient, pay $1.50 a pill for a new drug, 50 cents goes to pay for Canadian patients’ treatment.  Such a sweet deal for Canada, huh?  Other countries do the same, on the backs of Americans.  Maybe we should feel virtuous about this.  We provide a lot of direct aid to developing countries, but we’re also helping developed countries, too.  No wonder their healthcare costs are lower, and ours are higher.

 

This analysis applies to other medical technology (stents, implants, pacemakers), also.

 

 

AND NOW, THE NEWS…

Physicians contend EARLY Act would do more harm than good.

In an op-ed in the Los Angeles Times (7/31), physicians Steven Woloshin, MD, MS, and Lisa M. Schwartz, MD, both professors of medicine at the Dartmouth Institute for Health Policy and Clinical Practice, write that the proposed Education and Awareness Requires Learning Young (EARLY) Act, now before the House, "seeks 'to increase public awareness regarding the threats posed by breast cancer to young women.'" The physicians call this "well-intentioned and emotionally appealing" bill "a big mistake," arguing that the measure "would end up doing more harm than good" and even "runs counter to" scientific evidence. They point out that the measure "targets women between the ages of 15 and 39," when "fewer than five percent of breast cancers occur before age 40."

 

Doc D:  I put this in because saying we shouldn’t have a program for a low risk population might be viewed as “rationing healthcare.”  The fact that this bill targets women who are in a relatively low risk group is only part of the problem.  The other part is that in the process of raising awareness we increase worry, for the wrong age group.   The bill also proposes to teach women in the young age group how to avoid breast cancer.   Whether there are any strategies that do this is controversial.

 

I would rather women and their doctors assess the risk together as a patient-focused action.  Some young women ARE more at risk than others:  if they have a family history of breast cancer at a young age, for instance.  Others are not.  Why paint a broad brush?

 

Sebelius does not expect adjuvants to be used in vaccine.

On Thursday, the CBS Evening News (7/30, story 4, 2:20, Couric) interviewed HHS Secretary Kathleen Sebelius on H1N1 efforts, asking, "How many adults and children will be tested before the vaccine is available to the general population?" Sebelius said, "I don't know the exact numbers, but there will be testing on adults, testing on children, and testing on pregnant women to make sure that again, we have a safe vaccine. Now, Katie, this is a vaccine that is going to be very similar to seasonal flu vaccine, and we know that millions of children, millions of adults, pregnant women take seasonal flu vaccine year in and year out. The strain is a little bit different, but our scientists have determined that this virus is reacting very much like seasonal flu." She said that adjuvants or additives are "not anticipated" to make it into the vaccine, but "if we somehow have a mutation of the vaccine, it's possible that adjuvants will be used to both boost the reaction...and also to stretch the vaccine further."

        Lancet criticizes US plan to forgo adjuvants. Bloomberg News (7/31, Randall) reports that the US plan not to use adjuvants to "stretch the supply" of swine flu vaccines "would reduce the number of available shots just when other countries need them most, the British journal Lancet said in an editorial." In its editorial, "the Lancet criticized the US for plans to rely exclusively on standard formulations," writing that the "USA must support the use of dose-sparing strategies to avoid depletion of an already short vaccine supply. ... All countries will require the vaccine, but current manufacturing capacity will not be able to meet this demand." HHS spokesman Bill Hall said that the US will "review all clinical data to inform our decision on their potential use" of adjuvants after conducting "human tests to determine safety and effectiveness of flu adjuvants."

 

Doc D:  I put both news stories in here.  If you develop a product that you hope will produce an immune response in the body that will protect the person from a disease, you hope the product is strong enough by itself to build the protection, but sometimes it’s not enough.  Along come “adjuvants.”  They are additives that boost the immune response to higher levels, or more quickly, or for a longer period of time.  Their use frequently causes controversy.  They can worsen the side effects at the same time they make the vaccine more protective.  Some people say, since we don’t know whether they will do any harm, leave them out.  Others say, put them in if it helps to be more effective.   Blah, blah, blah…

 

What the Brits are complaining about is the US reluctance to use something that will make the amount of vaccine go farther.  If the US adds no adjuvant there are fewer adverse reactions and a reduced risk of law suits against the government and the vaccine maker.  For those old enough to remember, the Carter administration attempted a nationwide immunization against the flu.  Over 40 million doses were given, but there were several hundred cases of Guillain-Barre syndrome, a paralytic complication, and 32 deaths.  The outcry undermined the program, although it probably saved tens of thousands of lives.  And, guess what?  Guillain-Barre is a rare complication of a number of viral diseases…and of all the flue vaccine you’ve been getting all your life.

 

So, it’s going to be interesting when we see the press start reporting complications as if they are a result of the new vaccine, rather than a longstanding risk.  I think the government is trying to avoid the political damage that Carter suffered, despite the fact that we may be able to make enough vaccine only for us, but the rest of the world is SOL.  Let’s see if they come up with a principled plan in the end.

 

 

Medical quote of the Day:

To preserve one’s health by too strict a regime is in itself a tedious malady.—Maxims, Duc Francois de La Rochefoucauld [1613-1680]

 

Nature Note:   From Quackwatch:  “The U.S. Court of Federal Claims has upheld the decision of a Special Master that the family of William Yates Hazelhurst had presented no credible evidence that vaccination had caused him to develop regressive autism. http://www.autism-watch.org/omnibus/hazlehurst2.pdf The ruling is part of the Autism Omnibus Proceeding in which more than 5,000 families who claim that vaccines caused their children to become autistic are seeking compensation under the National Vaccine Injury Compensation Program (VICP). In February 2009, Special Masters ruled in this case and two others selected to test how similar cases should be handled. The decisions completely debunked the alleged vaccine/autism connection and implied that the doctors who promote (it) are acting unethically.” (emphasis mine)

 

This is another blow to the “Invisible Evil” crowd that substitutes their own psychological fears for science.  The “Special Masters” initiative is an effort to use experts to rule on a scientific question, instead of judges with little scientific training or knowledge.

 

Recommended Reading:

--The Joyless Economy:  The Psychology of Human Satisfaction, by Tibor Scitovsky. Originally written in 1976, and rated one of the top 100 books of the 20th Century by the Times Literary Supplement, Scitovsky’s book explored the notion that “there can be little real joy in the lives of people whose every appetite is gratified almost instantaneously,” according to the Foreword by Robert Frank.  Up to that point, economists had assumed that if you get what you desire, you get what satisfies you.  But, these are not the same.  Can what we want be different from what makes us happy?  The answer seems to be “yes.”  Fascinating discussion of the psychology of human happiness.

 

ERRATA:  I said last week that the House healthcare reform bill requires End of Life counseling (page 425 of the original HR 3200) and appeared to levy a care-terminating provision on one age group.  In looking back at it, it’s not clear that this is a requirement, but also not clear that it isn’t.  The provision references the Social Security Act, where the types of care that are authorized under the plan are defined, and adds this type of counseling to the list of what can be covered.  But when you go back to the House bill, the language is still obscure, listing the counseling, and its frequency of “no more than five years” interval for those over 65.  I can’t figure it out.

When tasked by constituents complaining that they haven’t read the bills they vote on, some members of Congress have said that it does no good to read the bill, because you can’t figure it out anyway.  Maybe this is one of those cases.  But it’s pretty sad when the confusion is allowed to stand.

Sorry for leading you astray.

 

Doc D

Opinions are entirely my own.  Quotations are from AMA Morning Rounds (© U S News Custom Briefings), Quackwatch.com, and other sources in the public domain.  As always, you may share this column, with appropriate attribution (here and in the text) included.  Please don’t forward my email address.

 

 

 

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