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.
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Wednesday, July 22, 2009

WHAT IS THE KINDLING TEMPERATURE OF HEALTHCARE REFORM? - UPDATE

The national discussion on Healthcare Reform is beginning to smolder as the supporters and detractors begin to sort through the details of the plans.  I’ve read through the rest of the bill quickly since my last newsletter.  Forgive me if I pat myself on the back for prescience.  Some issues I identified to you have reached the media:



1.  Recall that on page 16 of HR 3200 ( http://thomas.loc.gov/cgi-bin/query/D?c111:1:./temp/~c111m8G8uz ), the America's Affordable Health Choices Act of 2009, there is the convoluted “no choice” language that appears to controvert the President’s oft-repeated promise that people who are happy with their plan can keep it.



The president was asked about this part of the bill in one of his press conferences, and he replied “I’m not familiar with that provision of the bill.”  This doesn’t sit well, since his promise was a major selling point for that 70-80% of Americans who are happy or very happy with their current plan.  It undermines his sincerity in pursuing rapid passage, without the time for an informal referendum by ordinary Americans.  If he doesn’t know about this item, what else does he not know about the overall plan?  It suggests that his goal is political rather than reformative (if that’s a word).



  1. Also recall that on page 425 I said that there are provisions which require seniors to have their personal health plan and status reviewed every five years, in accordance with a government checklist that’s in the language of the bill.


The implications of this are becoming a concern among seniors and their organizations:  why do they have special scrutiny?  Aren’t health prognostication, advice, and planning for the future a topic for all Americans?  The concern is that this provision concentrates on government-driven standards for when people should consider termination of care, focused on only one group.



The political cost of potentially allowing taxpayer funding for abortion, is another dumb mistake.  As you know, I consider this issue to be complex.  BUT, now slightly over 50% of the country does not support the procedure:  why put that in the bill and undermine support further?



PS:  I found the following in the second half of the bill (this could be incomplete, it’s mind-numbing to read):  two new agencies, three new committees, several Task Forces, a Medical Device registry, and research money for a lot of pilot programs.  By the way, on these pilot programs, in almost 30 years of government service I am unable to recall an instance where government has been innovative.  Only industry does this.  In every case where a successful program has been adopted, the idea came from free enterprise.  If you can think of an exception, I’ll be happy to look into it.



PPS:  members of Congress are exempted from having to enroll in the new plans.  It would be a nice gesture of their belief in reform, but they have the Federal Employee Plans choice, and are not eligible to change. So, fat chance they will amend this.



I’ve just scratched the surface of those things that jump out at me, but as we get deeper into the bills, a lot of screwy things are coming up that make it the height of lunacy to rush to passage.  This shouldn’t be about the administration’s future.  Or, as the White House Chief of Staff was reported to have said months ago, “No crisis should be wasted.”  Meaning that politically it’s smart to press forward quickly in the Honeymoon period of the presidency, using that political capital and the people’s fears, to accomplish as much as they can.  Don’t mistake me, this is smart politics, it’s just focused on the party’s interests, which may or may not be in the nation’s interests.



From the medical profession side, it is useful to know a few things.  For instance, the AMA issued a formal statement supporting the above plan.  Firstly, while the AMA is the largest advocacy and professional group for physicians, the last time I checked, less than 1 in 4 doctors belong to it.  It’s largely seen as not relevant to the practice of medicine (I disagree), and most doctors just want to see patients and stay out of anything else.



Secondly, the AMA sold out to the administration for ~$238B in increased payments for Medicare and Medicaid.  For many years, those payments have been kept low, and each year are supposed to be cut further.  Every year Congress has to pass a bill to keep the cuts from going into affect.  Reimbursement for Medicare/Medicaid are in the 80% range of those payments of other plans, so many doctors don’t prefer these patients, and accept them only when necessary, or when a patient of theirs turns 65 and transitions to Medicare.  The president promised to payback the $238B “doctor fix” and to adopt a different formula for reimbursement in the future.  So the AMA sold out for money.  For me there are other troubling provisions in the AMA’s agreement with the Prez:  they agreed to using “outcome measurement at the point of care.”  This means that doctors will get guidance from government agencies on what they do in the examining room as to what tests, drugs and treatments they can use for all patients with a certain medical problem.  The AMA’s statement on their support is at  http://www.ama-assn.org/ama/pub/advocacy/current-topics-advocacy/health-system-reform/ama-hsr-principles.shtml if you would like to dig into it.



Also of note, is that the administration does not include this $238B in their analysis of the cost of reform, they don’t consider this payoff a cost.  Which is why you will see administration officials arguing that the $1 trillion bill is not correct.  You can always make the total sound better when you exclude certain things.  As always, in politics the side that controls the definitions, wins.

By contrast, while the President has been using the Mayo Clinic as his example of high-quality, cost-controlling healthcare in numerous speeches on the campaign trail, and during his term, that compliment has been spurned.  The Mayo Clinic, which, as the President himself says, is an internationally acclaimed center of excellence in healthcare, has issued a statement that

the proposed legislation misses the opportunity to help create higher-quality, more affordable health care for patients. In fact, it will do the opposite.

In general, the proposals under discussion are not patient focused or results oriented. Lawmakers have failed to use a fundamental lever – a change in Medicare payment policy – to help drive necessary improvements in American health care. Unless legislators create payment systems that pay for good patient results at reasonable costs, the promise of transformation in American health care will wither. The real losers will be the citizens of the United States.”


This is a big blow.  The question of cost v rationing has become the conundrum, with the independent Congressional Budget Office testifying that the House plan does nothing to reduce cost, and will increase the deficit by $1.3 trillion over the next 10 years…and still not cover all the people who are uninsured.

Just this morning the President invited the CBO director to come to the White House to “discuss” their analysis.  I’m sure the focus was to get them to reconsider how they are calculating the total.  Meanwhile, the DNC and the RNC are pushing ads in possible swing states, and the President will address the nation tonight to urge support.  It’s just my opinion, but he’s spending the value of the Bully Pulpit very quickly.  I read a report that the media is starting to back off of coverage of some of his appearances because there is little new information and he’s appearing so often that it’s becoming a footnote.   It may be that he’s willing to break the bank on his popularity in order to get stuff done very quickly.  All of the polls are creeping down, and in the opinion of one commentator, “once a President’s approval reaches the 40’s, he becomes a caretaker.”  Maybe not, these things can change.

Speaker Pelosi, has said that the proposed plan has “a cap of costs, not on benefits.”  I hope you realize by now that these are not independent variables, and I can see virtually nothing in the bill about costs, only benefits.

I recommend that you watch the President’s briefing:  will it be another cheerleading session, or will he address the substantive issues, at least one of which he is “not familiar with”?



One thing I haven’t discussed is the potential for alternative plans.  There are a ton of them out there.  Consider the following:  The Center for Medicare and Medicaid Services (CMS) estimate that 70-80 billion dollars are wasted annually due to Fraud, Waste, and Abuse (FWA).  Multiply this figure alone by 10 years, and you get the funding that would pay for most of the $1 trillion cost.  However, in the current Democrat plans there is no, to minimal, provision to address this.  Why not?  Several other Democrat and Republican alternative plans address this directly.



A clarification is useful about FWA, some people think it refers to criminal doctors.  There are some of these, but the underlying problem is that CMS has no resources to pursue more than a small fraction of these abuses.  And as long as they can’t, the bad actors will continue with relative impunity.  However, a substantial part of FWA is that the people who process the Medicare and Medicaid claims are GS 3-4 workers.  This is the lowest paying personnel rating in the federal personnel system.  As a hospital commander I found that my employees who were responsible for “coding” what was done in the hospital were wrong 15% of the time.   The code is what establishes what the patient’s diagnosis is, and is the foundation for how the government (and industry) decides how much to reimburse.  Once I gave them more training, lobbied for GS 7-8 supervisors, and got the docs involved, our accuracy improved dramatically.  When Medicare errs in processing, this is also Waste.  I haven’t seen figures for what percentage of the $70-80B comes from this category.





To bring this long discussion to an end, I want to repeat something I said a while back.  The numbers of the uninsured are variously quoted in the media, and it creeps up through a form of “data inflation” that everybody is guilty of.  Me too, although I try to smack myself around when it happens.  That’s one reason I give you the references, so you can check them out and decide for yourself.



Take 47 million people as the most recent figure.  Here’s how that breaks down:



Original total                                                                                                                                                     47M



            Adults and children who qualify for Medicare/Medicaid/CHIP who haven’t enrolled                                    9                      -I can’t find out why they don’t.  The fix is just to get them enrolled.

            The wealthy that don’t need insurance                                                                                                     2                      -If you make a lot is makes more sense to just pay out of pocket, rather than pay premiums for coverage you may not use.

            Those adults who are between jobs at the moment and will be covered again within a few months             14                     -The fix here is portability of insurance between jobs

            Illegal immigrants                                                                                                                                  8                      -You can argue whether we “should” enroll them—either as a moral issue, or that they will just go to ER’s.

            Adults aged 18-30 who can afford coverage but decline to do so                                                            2                      -they’re healthy, have other priorities, and don’t see the need.  Under the bill above, they HAVE to pay.



Remaining uninsured                                                                                                                                         12M                  -note that there is rounding error here.



There’s another wrinkle:  there are people who have a military or federal employee spouse, who may want to use only their spouse’s plan, and not enroll in an employer’s plan.  I just can’t tell how much this skews the above.  It’s a personal decision.  The bill is clear that employers will have to pay the ~8% tax for each employee who doesn’t enroll (even if the employee decides to enroll elsewhere—now that’s weird), but it’s not clear about the military and government workers spouses.



Twelve million is less than 5% of the population.  My summary is primarily taken from the Kaiser Foundation’s studies.  For those of you who are unfamiliar with them, they are a highly respected, non-partisan research organization who support universal coverage, but publish accurate data.  In my opinion this is our real target for reform.



Again, he who controls the definitions, wins.





Everyone, including both parties, agree that we need healthcare reform.  If we don’t pay attention to “what kind” of reform, we will get the change, good and bad, that we deserve.







Doc D



Opinions are entirely my own.








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