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Hospital Mergers Don’t Work

Stanley Feld M.D.,FACP,MACE

This article appeared in Kevin M.D. several weeks ago. The article has some valid points. However, it misses the vital reasons hospital mergers are not working.

“In 2010, there were 66 hospital mergers in this country. Since the Affordable Care Act went into effect, the rate of hospital consolidation has increased by 70 percent.

By creating incentives for physicians and health providers to coordinate under accountable care organizations (ACOs), the ACA hindered the ability of regulators to block hospital mergers while incentivizing hospital consolidation.”

The government published reason for encouraging hospital mergers was to increase hospital efficiency and decrease healthcare costs.

I have said over and over again that the real goal of Obamacare was to have total control over the healthcare system. This control could be accomplished by controlling all the providers.

Hospitals realized that physicians controlled the utilization of hospital facilities. As knowledge and technology improved more and more diagnosis and treatment could be performed on an outpatient basis.

All the hospitals had to offer was a brick and mortar facility. Hospitals tried to stop physicians, before Obamacare, from developing their own outpatient facilities. The hospitals lobbied the government to require certificate of need for advanced outpatient technology (MRI, CAT scans, Outpatient Surgical facilities, and laboratories).

It did not work.

Obamacare provided incentives for hospitals to merge and consolidate into hospital systems.

Obamacare also provided incentives for hospital systems to create Accountable Care Organizations (ACOs). I have written about ACOs destiny to fail ad nauseum.

The government’s pretext was that hospital consolidation into hospital systems would increase efficiency with resultant decreases in hospital care costs.

The real reason was to get hospitals to hire physicians. At that point they would lower reimbursement on both. Hospitals and physicians would be totally dependent on the government.

“There is a growing body of evidence that hospital mergers lead to higher prices for consumers, employers, insurance and the government.”

 

The result is opposite the stated goal and was totally predictable.

 

“It is imperative to educate patients and lawmakers as to how the consolidation of hospitals and medical practices raise costs, decrease access, eliminate jobs and, ultimately, reduce care quality as a result.”

The development of hospital systems led to the expansion of administrative personnel which in turn led to increased administrative salaries and costs. Administrative costs are not government controlled. They are part of the overinflated hospital overhead.

In some cases, the government increased hospital systems’ subsidies because of increased administrative costs.

It did not lead to greater compensation to physicians they hired. Yet the hospital system was totally dependent on staff physicians for revenue production.

Physicians tended to work hard when they owned their own practice. Now that their salary was guaranteed they tended not to work 12-hour days.

Initially, hospital systems paid physicians on the basis of physicians’ previous productivity in their private practice. Additionally, physicians were given a payout for their practice. The payout was never the real value of their practice.

Hospital systems calculated the physicians’ productivity because the hospital system hired all the full-time employees. The hospital systems’ computer systems were also used in the calculation of productivity and overhead.

Hospital systems controlled the overhead and the books. A lot of the time the calculation was inaccurate. This was the result of two fees collected from the government and the insurance companies. One was a technical fee that belonged to the hospital system. The other was a professional fee for the physician.

At times, the professional fees were not collected and the physician groups could not figure out the discrepancy.

There had been a long-standing mistrust by physicians toward hospitals prior to Obamacare. The errors in calculations resulted in greater mistrust by physicians toward hospitals.

If a physician was not producing according to the hospital system’s calculation the physician, at the end of a usual two-year contract, was let go. This created more mistrust and suspicion among physicians toward hospital systems.

It has also caused physicians who anticipated this stranglehold by hospital systems to become concierge physicians or open outpatient clinics of their own.

This has caused hospital systems to provide concierge physicians of their own as well as hospital outpatient ambulatory surgical care clinics. The problem is that the free-standing physician owned ambulatory surgical care clinics (ASC) are more efficient and cheaper than the inpatient hospital care and the hospital’s own outpatient ambulatory surgical care clinics (HOPD). Some privately own ASC are cheaper than the increasing deductibles patients with private insurance have to pay using their insurance.

Below are some examples of Ambulatory Care Surgical Center fees as opposed to Hospital Owned Outpatient Surgical fees.

 ASC – $1250 ($500 out of pocket)

HOPD: $4250 ($1000 out of pocket)

Echocardiogram:

ASC $500 ($200 out of pocket)

HOPD: $4250 ($1250 out of pocket)

Arthroscopy of Knee:

ASC – $3600 ($1070 out of pocket)

HOPD: $13,000 ($3900 out of pocket)

Hernia Repair:

ASC – $2500 ($750 out of pocket)

HOPD: $19,000 ($5700 out of pocket)”

There has been a dramatic increase in hospitals gobbling up independent providers and becoming powerful regional monopolies. These monopolies raise prices not decrease prices.

“According to a 2012 study by the Robert Wood Johnson Foundation, “the magnitude of price increases when hospitals merge in concentrated markets is typically quite large, most exceeding 20 percent.”

 

Forbes’ Avvik Roy of Forbes said, a presentation  in 2012.

You have to get at the errors in public policies which drive the hospitals to merge.” He concluded that government must do more to fight consolidation among hospitals.”

The underlying theme is that President Obama wanted Obamacare to fail so it can be replaced by a single party payer system that has been pushed by progressives since 1935. Obamacare is moribund despite claims by Democrats. They refuse to face the fact that socialism does not work even thought it is a feel-good concept.

“A recent paper authored by Northwestern’s Leemore Dafny, Columbia’s Kate Ho, and Harvard’s Robin Lee provides some definitive proof that when hospitals consolidate, prices increase substantially. The effect is made worse directly in proportion to proximity of the merging hospitals. “If you are doing it because you think in the long run it will serve your community well, you should think twice,” Dafny said.”

Hospital systems are consolidating because they think it is in their vested interests to consolidate. They are falling right into President Obama’s trap. Hospital systems do not control productivity. Physicians control productivity.

A study published by the National Bureau of Economic Research, conducted by Zack Cooper of Yale University, Stuart Craig of the University of Pennsylvania, Martin Gaynor of Carnegie Mellon and John Van Reenen of the London School of Economics, sheds light on the real cost of reduced competition among hospitals: hospital prices are 15.3 % higher when a hospital had no competition compared in markets with four or more hospitals, amounting to a cost difference of up to $2000 per admission. Hospital prices are 6.4% higher in markets with two hospitals and those with three are 4.8 % more expensive when compared to markets with four hospitals.”

The American Hospital Association has been aggressive in criticizing those reports. It has funded a couple of critical reports  defending mergers and consolidations. The American Hospital Association doesn’t understand the progressives’ trap either.

It is backfiring already as hospital systems are saying they are losing money. The government is cutting reimbursement, the insurance companies are raising insurance rates and increased deductibles are unaffordable.  Consumers are experiencing a decreased access to care.

None of the policy makers are focused on the right problems because they want a single party payer system in order to gain total control over the healthcare system. Progressive have no interests in the cost of care, the need to raise taxes or the delivery of efficient care.

America is going to experience an economic disaster as it has been experienced in Canada, England and many other countries in the world.

Consumers are continuing to take it on the chin in other countries because 80% are not sick at any one time. Consumers in other countries feel secure with the guaranteed coverage even if it increases their taxes and decreases access to care.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.



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Single Party Payer System Backfires On Great Britain

Stanley Feld M.D.,FACP,MACE

Last year the Great British single party payer system, The National Health Service, backfired.

It occurred just at the time Americans were being suckered into instituting a single party payer system by its progressive politicians..

Winston Churchill was right when he said,“You can always count on Americans to do the right thing—after they’ve tried everything else.”

I hope some of our leaders are listening.

President Obama appointed Dr. Donald Berwick Director of the Center for Medicare and Medicaid Services, during the Senate’s recess July 4th2010 in order to avoid a senate confirmation hearing. The American people did not have the opportunity to hear Dr. Berwick’s philosophy on healthcare reform and his plans for Medicare.

Dr. Don Berwick touted Britain’s National Health Serviceas the America’s ultimate healthcare role model.

Dr. Berwick had some good ideas and many very bad ideas.

President Obama had other ideas. His ideas were not about repairing the healthcare system. His goal for healthcare reform was having the federal government control the entire healthcare system.

President Obama and Dr. Berwick portrayed physicians and patients as the villains in healthcare dysfunction. It is easy to blame the physicians and the patients because both have some blame in the dysfunction.

The main villains are the healthcare insurance industry, the drug companies, the government, and the lack of malpractice reform.

In 2009 the new British coalition government declared the National Health Service a fiscal failure.

The new coalition government had proposed a reorganization of its National Health Serviceand proposed reorganzation.

After 62 years, the British government’s present goal is to decentralize its healthcare system. The goal does not include decentralizing medical decision making. The system continues to put restraints on consumers’ medical spending. The government believes consumers are not smart enough to make their own medical decisions.

 

Baroness Hale had previously written the following for the British High Court, the U.K.’s equivalent of the U.S. Supreme Court:

“Decision-makers must look at [the patient’s] welfare … the nature of the medical treatment in question, … they [decision makers] must try and put themselves in the place of the individual patient.”

“The patient is not the decision-maker.”

The British Healthcare Service has an organization called NICE. Nice is a perfect bureaucratic name for “the National Institute for Clinical Excellence.” NICE sounds nice. Its function is not very nice.

According to the NHS Constitution, “You have the right to drugs and treatments that have been recommended by NICE.”The National Institute for Clinical Excellence is an agency that “advises” the government whether to authorize payments or withhold them for treatments deemed “not cost effective.”

Britain’s National Health Servicehas continually changed over the 62 years. Various British administrations have searched for the formula to deliver high quality care at an affordable price.

Unfortunately,Britain is making another complicated mistake.

The United States is making the same mistake as it marches toward a single party payer system. The mistake is the lack of respect for the intelligence and will of consumers. The mistake is not permitting consumers to be financially and emotionally responsible for their own medical care decisions.

The British incident is chilling. The British High Court recently ruled against parents’ wishes in defense of the National Health Services.

The high court’s decision is the result of British consumers giving total control of the healthcare system to its central government.

The British government believes that the people are not smart enough or responsible enough to figure out how to take care of themselves.

The British thinking is not dissimilar to the thinking of the Obama administration and Dr. Donald Berwick.

The basic conflict is over who is ultimately in charge of medical decision making. Government control of medical decision making is not limited to Great Britain’s single-payer structure.

In all government run health-care systems, whether in Australia, Canada, or even here in the United States under Obamacare, government increasingly makes final medical decisions, not patients in consultation with their doctors.

NICE is an agency that “advises” the government whether to authorize payments or withhold them for treatments deemed “not cost effective.”

“Consumers have the right to do what they or their doctor thinks best medically as long as your decision does not override the decision NICE decides is cost effective for the government.”

Britain has nevertheless experienced increasing costs and demand as quality and access to care has decreased.

What is missing from the British system?

All government has to do is make the right rules, empower consumers with their own money, level the playing field among stakeholders and get out of the way.

I think Americans understand that building bigger and bigger bureaucracies never solves social problems. They make the problems more complicated and more costly to fix.

Americans did not fully understand two recent single party payer events that occurred in Britain. This was partly because the American media did not cover the story’s significance adequately.

Perhaps the American media did not understand the story’s significance to the American debate in reference to a single party payer healthcare system.

First Charlie Gard and now Alfie Evans. These are two 23 month old babies who, though verbally silent, still gave clarion warnings to proponents of single-payer health care: The government — not my parents — is in charge of my life.”

Charlie Gard was born in August 2015 with a rare genetic disorder that carried a poor long-term prognosis.

“In July 2017, little Charlie was just 23 months of age and on a ventilator. Over the objections of his parents, British doctors decided to withdraw life-sustaining care.”

“According to British Courts, the National Health Service (NHS), the country’s single-payer system, is the ultimate medical decision maker — not the family. Ventilator support was withdrawn and Charlie died.”

Less than a year later another 23 month old child hit the British headlines. Alfie Evans was a comatose child whose NHS doctors said his condition was hopeless. His physicians felt he could not survive without ventilating life support. They wanted to terminate his life support.

His parents wanted to transfer their child to Rome’s Bambino Gesu Pediatric Hospital for further care. The Italian Hospital was willing to take him.

The British High Court ruled against the parents’ wishes, leaving Alfie’s fate to the NHS. As Justice-Baroness Hale wrote in Aintree v James: “we [referring to patients] cannot always have what we want.” On April 28, 2018,Alfie’s ventilatory support withdrawn.

Alfie did not die when artifical ventilation was withdrawn. He died because of inadaquate I.V. nutrition.He was able to breath on his own. His physicians were wrong.

NICE is the model on which the Independent Payment Advisory Board (IPAB) was created under the Affordable Care Act.The Independent Payment Advisory Board, or IPAB, was to be a fifteen member agency which was to have the explicit task of achieving specified savings in Medicare without affecting coverage or quality. The system creating IPAB granted IPAB the authority to make changes to the Medicare program with the Congress being given the power to overrule the agency’s decisions through supermajority vote.

The Bipartisan Budget Act of 2018repealed IPAB before it could take effect.[1

 In my opinion it should not be the government or the court that decides about who should live or die. It should be the patient or the patient’s family who decides with the advice of the patient’s physicians and clergy.

The institution the patient is being cared in should not be responsible for the bill.

Consider the question “who’s in charge?” from two perspectives: that of the American public and that of physicians.

Americans prize their freedom above all else. When the government makes medical decisions against the patient’s wishes, it directly infringes on personal freedom. It is doubtful that Americans would support a single-payer system if they understood what they have to give up in exchange for the promise of government supplied health care. Americans would be giving up freedom of choice.

http://stanfeld.com/?s=single+party+payer+system

 

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone

 All Rights Reserved © 2006 – 2018 “Repairing The Healthcare System” Stanley Feld M.D.,FACP,MACE

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More Single Party Payer Noise

Stanley Feld M.D., FACP,MACE

Democrats have tried to pass a single party payer healthcare system since 1935. Slowly, but surely, the American population has been indoctrinated into believing that a single party payer system run by the government is the best healthcare system to have.

Americans have been filled with disinformation about the wild successes of single party payer systems in the rest of the world.

The economics of these single party payer systems are seldom discussed in a coherent way. Americans have no idea of the economic burden a single party payer system places on the budget of countries that have such a system.

The fact that these governments continue to raise taxes to pay for their single party payer system while decreasing their citizens’ access to care is hardly ever discussed. Only the favorable statistics that fit the progressive narrative are published.

In Norway the income tax rate is 50%. This is mostly because of its universal single party payer healthcare system. Norwegians seem happy with the system. If they get sick they have nothing to worry about. Their health care is free.

The Canadian healthcare system is unsustainable.

Canada spends 50% of its GNP on healthcare. All of the provinces are experiencing massive deficits due to additional healthcare costs.”

“Canadians who are healthy and do not need to interact with the system are happy and feel secure that their healthcare needs will be serviced without cost. Nothing is free.”

“The United States consumes only 18.5% of our GDP on healthcare. This percentage is rising as access to care is decreasing.”

The Frazer Reportis very specific on the cost of healthcare in Canada although the government is not very transparent.

Each province is having a difficult time figuring out how to fix its healthcare system. Many Canadians are convinced that a single party payer system is not the answer but cannot politically eliminate it.

The fact is nothing is free and only 20% of the population interacts with the healthcare system at any one time. People who are not sick think the single party payer system in great. They are happy they have no anxiety about the cost of healthcare if they get sick.

In Britain taxpayers are unhappy with the National Health Services. Consumers recognize the bureaucratic waste in their healthcare system. They suffer from decreased access to care. Wait times for health care and surgery are ridiculously long.

The private healthcare market is flourishing in Britain for those who can afford it. 

The British healthcare system is unsustainable. The British government has not been able to fix the expensive National Health Service.

America has a single party payer system for Medicare, Medicaid, SCHIP and the VA system.

Seniors love Medicare. Most seniors could not afford to get medical treatment if there was not the Medicare System. Policy wonks and Democrats refuse to recognize that in 1965 after Medicare was enacted, healthcare prices exploded. Most economist agree, as a result of Medicare, the cost of healthcare in America has continued to increase yearly for all Americans.

Congress has ignored the basic defects in the Medicare system that has caused this explosion. Over the years a few brave congressmen have made attempts to correct these structural defects.

The Democrat and Republican establishment have ignored these congressmen.

The political establishment has made feeble attempts to control costs through ineffective regulations. The bureaucracy has grown and the healthcare system has become more costly and inefficient.

The reduction in reimbursement to physicians has resulted in the tremendous increase in concierge medicine. This explosion in concierge medicine has decreased access to medical care in many cities in the U.S.

The result is an increase in cost and greater opportunity for abuse by the insurance industry, the pharmaceutical industry, hospitals and healthcare providers. The government has imposed more control over the individual’s ability to make his or her own healthcare decisions.

Medicaid has experienced the same increasing costs. It also created a shortage of physicians because of low reimbursement. Obamacare has expanded Medicaid. This has decreased the availability of medical care for Medicaid patients.

President Obama’s law (Obamacare) increased the number of Medicaid recipients but did not cure the reasons for the lack of providers. Many clever Medicaid providers have figured out how to exploit Medicaid rules only to suffer from government investigations and penalties in the long run.

The VA system is the purest example of sheer failure. Not only are the patients unhappy but also the providing administrative bureaucracy is riddled with inefficiency, corruption and waste.

The inefficiency, corruption and waste have not been able to be fixed by many notable private sector executives the government has hired to fix it. They have all ultimately resigned or were fired.

The VA system’s single party payer system remains an incurable failure.

These examples are proof that a single party payer system is unsustainable and not economically feasible. The government continues to make the same mistakes over and over again.

Are these mistakes intentional? Perhaps.

The government’s goals are to gain power and have control over the population. If its goals were to have an efficient and effective healthcare system, it would provide the resources to permit all consumers to drive the healthcare system. It would create a system that would motivate consumers to be responsible for their healthcare.

What is happening now?

The healthcare policy ideologists are using the New York Times as their propaganda vehicle to promote a single party payer system.

The article, Back to the Health Policy Drawing Board” may be intellectually simulating to readers of the Sunday Times. However, many of its details are untrue.

After one casually reads the article on a pleasant Sunday morning it would seem much simpler to have a single party healthcare system controlled by the government than the chaotic system that presently exist. The New York Times article is promoting Medicare for all.

Medicare currently is a single party payer system whosecost is out of control. America cannot continue to print money forever.

America’s politicians are ignoring this fact in order to gain more power.

 

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.



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The Reason Congress Does Not Work

Stanley Feld MD,FACP, MACE

I have wondered why either house of congress has not done anything about healthcare reform in the past 6 months.

The reason is that both the Democrat and Republican leadership in both houses of congress do not want to do anything about Repairing the Healthcare System.

On July 2, 2018 CMS released a report on the performance of the health insurance exchanges and the individual Obamacare health insurance markets.  

“Centers for Medicare and Medicaid Services Releases Reports on the Performance of the Exchanges and Individual Health Insurance Market.

Reports show individual market erosion and increasing taxpayer liability.”

The CMS conclusions for 2017 were obvious in 2016. Obamacare is on a downward spiral.

In 2017 87% of enrollees were subsidized as opposed to 83% in 2016.

There was an alarming 20% drop nationwide in enrollees in Obamacare’s individual healthcare market without federal premium subsidies.

223,000 subsidized enrollees dropped their subsidized insurance.

These Obamacare enrollees dropped their insurance because even with subsidies their premiums became too expensive. Their average monthly premiums of the subsided and unsubsidized groups spiked by 21%.

Unsubsidized Obamacare enrollment dropped an average of 33% nationally. It dropped an astonishing 73% in Arizona. It is a wonder that neither Arizona senator wants to do anything about Repairing the Healthcare System. It is also a wonder that Arizona citizens continue to support these senators.

Obamacare is dead!

The Democrats are naturally blaming its death on President Trump. President Trump does not want to pour more money into this failed concept while forcing a greater payment liability on taxpaying  Americans.  He wants congress to do something to repair the healthcare system.

President Obama’s plan all along was for Obamacare to fail and be replaced by a single party payer system.

I have written about 20 articles on why a single party payer system is unsustainable and will fail.

http://stanfeld.com/?s=single+party+payer

I am unable to insert links and videos properly. Please insert the links for both into your browser. It is important to understand how the rookie representative view how the government works.

The British National Health Services System is a failure. Single party payer systems close to home are a failure.

For example The VA Health System is a failure. Medicaid is an unsustainable failure. It is unsustainable while offering inefficient care.

http://stanfeld.com/?s=Medicaid+failure

Medicare is a failure because it is unsustainable by the government. Seniors like it because they can get care that they could not afford otherwise.

However, seniors are getting wise. Medicare is becoming unaffordable to seniors. The government construction of Medicare premiums for Part B, Part D and Part F are costing seniors somewhere north of $16,000 a year in post tax dollars.

Medicare used to pay 80% of its approved fee. The approved fee is about 50% of the physicians’ fees. In 2018 Medicare is only paying around 50% of its approved fee. Seniors have to pay the difference.

This will drive seniors out of the Medicare marketplace.

There is a better way. I have gone into excruciating detail describing the better way.

http://stanfeld.com/?s=My+Ideal+Medical+Savings+Account

Newt Gingrich, when he was house leader, said my idea was a BIG IDEA. However nothing ever came of the big idea. The “big idea” empowers the people not the government.

Unlike many other politicians who have promised to take on the establishment and “drain the swamp,” Representative Thomas Massie (R-Ky.) 2012 is actually trying to do just that, and is taking some serious flak for his exposure of the Deep State and its agents on Capitol Hill.”

https://www.thenewamerican.com/usnews/politics/item/29426-in-the-swamp-fearless-reps-expose-the-corruption-on-capitol-hill?src=ilaw

If you click on the newamerican link above you will have all the videos in one article.

In a video series entitled The Swamp, Massie, along with Representatives Dave Brat and Tom Garrett of Virginia, Ken Buck of Colorado, Rod Blum of Iowa, and Ted Yoho of Florida, are showing people “what happens behind the scenes in Congress.”

To date, there are four episodes, each running about 10 minutes.

Besides pulling back the curtain to reveal the names and tactics of those who really pull the legislative levers in Congress, The Swamp videos make it very obvious that, although there are 435 members of the House of Representatives, the key decisions are made by a handful of very powerful leaders bent on controlling the country and that the betrayal is bipartisan.

The first video introduces these non establishment representatives’ chief complaint.

https://www.facebook.com/TheSwamp/videos/1794302460864573/

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<iframe src=”https://www.facebook.com/plugins/video.php?href=https%3A%2F%2Fwww.facebook.com%2FTheSwamp%2Fvideos%2F1794302460864573%2F&show_text=1&width=560″ width=”560″ height=”427″ style=”border:none;overflow:hidden” scrolling=”no” frameborder=”0″ allowTransparency=”true” allow=”encrypted-media” allowFullScreen=”true”></iframe>

An average of 4,500,000 people have viewed these videos.

“Representative Blum responded, “Most all the decisions around here are made by a few people at the very top, without the input of any other congressional members or U.S. senators. That’s not good representative government, wouldn’t you say?”

 “I think both parties are engaged in a quiet deal that we will support our base, and if it leads to bankruptcy, okay, and you will support your base, and if it leads to bankruptcy, okay,” Representative Buck says in Episode 1.

In Episode 2, the perception of a two-party system where the two parties oppose each other and want to achieve different ends is shattered as leaders of Democrats work with their Republican counterparts to shove a bloated, unconstitutional omnibus spending bill through the House without giving members time to read the text of the measure.

https://www.facebook.com/TheSwamp/videos/1807501746211311/

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“One of the most shocking revelations comes in Episode 3, when Rep. Massie details how the party forces members to pay “rent” for their committee assignments and chairmanships. If a congressman wants to sit on a committee, he is expected to raise a certain amount of money for the National Republican Congressional Committee, the body that works to elect House Republicans. There is an identical system on the Democrat side. In an interview, Rep. Buck told me this system has been in place for Republicans since the days of Newt Gingrich, and even longer for Democrats.”

https://www.facebook.com/TheSwamp/videos/1816800768614742/

<iframe src=”https://www.facebook.com/plugins/video.php?href=https%3A%2F%2Fwww.facebook.com%2FTheSwamp%2Fvideos%2F1816800768614742%2F&show_text=0&width=560″ width=”560″ height=”315″ style=”border:none;overflow:hidden” scrolling=”no” frameborder=”0″ allowTransparency=”true” allowFullScreen=”true”></iframe>

Episode 4 of The Swamp was released just a few days ago and covers the consequences faced by those lawmakers brave enough to buck the system and call out the conspirators.

https://www.facebook.com/TheSwamp/videos/1831877993773686/

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There you have it. This is the complex definition of The Swamp.

The structure has been created whereby our representatives and senators do not represent the will of the people.

Congress represents the will of the vested interests. Anyone that understands this has to play ball or move out.

It will be very difficult for America to get a sensible healthcare reform bill for the benefit of the American people when this pyramid of power exists.

It looks like legislation is driven by money, not the will of the people. These four videos are essential to understanding the process. They must be watched.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.



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President Trump’s Drug Plan Is On Target

Stanley Feld MD,FACP,MACE

https://www.cbsnews.com/news/trumps-medicare-rx-blueprint-has-a-tricky-wrinkle/    

President Trump’s proposal for lowering drug prices to an affordable range is on target.

I have received a several requests asking me to explain the administrations plan. The “media is the message.” The traditional media has once again missed President Trump’s message completely. I suspect the traditional media has missed President Trump’s message on purpose because of their bias against the president.

The traditional media jumped on Trump’s plan as a non-plan aimed to penalize the middle class for the benefit of the pharmaceutical industry.

Either the traditional media hates Trump and his administration so much that they are against everything he does or they have not read his plan with an open mind because it has too many words in it.

It is pretty clear that Nancy Pelosi did not read President Trump’s drug plan or if she did she did not understand it. She said:

“This weak plan abandons the millions of hard-working families struggling with the crisis of surging drug prices.”

Nancy Pelosi’s statement is otter nonsense.

Her statement is reminiscent of the statement she made about Obamacare;

“You have to pass the plan in order to see what is in it.”

Any thoughtful Democrat should be ashamed that Nancy Pelosi is their leader.

I picked the coverage of only a few of the traditional media, CBS news, The New York Times and the Washington Post’s. All the progressive leaning media are really echo chambers of each other.

Each media outlet missed the Trump administrations’ point. They all are looking through their progressive lens. They believe the only plan that would work is a single party payer system controlled by the government.

They also see a tired public looking forward for the government to take over the complicated issue of healthcare. They have not interest is looking at the unintended consequences of a government takeover of the healthcare system.

A single party payer system will not work because public dependence on bureaucrats and politicians has never worked.

Simple examples are the VA Healthcare System and Medicaid. Government controlled health plans such as the VA system became too inefficient, costly, corrupt and unsustainable. The quality of care decreased and consumer choice and input has been eliminated.

People would never know what President Trump’s drug plan is all about it if they just read about it in the traditional media. If they made it easier for themselves and just read the headlines, as some of my friends have, they would know nothing about Trump’s drug plan.

One must listen carefully and read the source material.

President Trumps YouTube

https://youtu.be/Cds8h9DbTdc

This is the official outline document of the steps that need to be taken to fix the broken drug plan system.

CBS new got it wrong right off the bat.

http://www.cbsnews.com/trumps-medicine-rx-bluprint-has-a-trickly-wrinkle/

“The Trump administration’s “Blueprint” to lower drug prices and reduce patient costs made one thing clear: The government will not directly negotiate with drug companies to secure lower prescription prices. But that doesn’t mean it isn’t proposing changes that would dramatically alter the way Medicare pays for some of the most expensive drugs, and in the process, potentially raise out-of-pocket costs for some of the country’s sickest patients.”

CBS News then brings up an issue that part of President Trump’s solution. The news agency criticizes the administration before it knows the administration’s solution.

A cornerstone of the Trump plan calls for all Medicare drug payments to be consolidated under Medicare Part D, the prescription drug plan for Medicare enrollees administered by private insurers. Under Part D, insurers and middlemen known as pharmacy benefit managers (PBMs) negotiate with drug companies for discounted prices in exchange for the drug companies’ products being included in the PBMs’ list of covered drugs.

But drugs intravenously administered in physicians’ offices, such as chemotherapy and vaccines, are usually covered as a medical treatment under Medicare Part B. Physicians buy these drugs directly from manufacturers, and Medicare reimburses doctors for the drugs’ average sales price plus 6 percent.

A perfect example is the yearly flu shot. Most flu shots are given at local pharmacies and supermarkets for Medicare patients’ convenience.

Medicare Part B pays $120 for a $15 injection dose. How is that for a colossal waste of Medicare dollars?

Pharmaceutical companies are against the idea, partly because they generally are paid more under Part B than Part D.

Alex Azar, Health and Human Services secretary and former president of the U.S. division of pharmaceutical giant Eli Lilly (LLY), has been touting the move to consolidate Medicare drug payments.

“Bringing negotiation to Part B drugs is such a potent way to bring down prices that PhRMA is already protesting the idea,” Azar said in a recent speech at the American Enterprise Institute in which he referred to the drug industry trade group called Pharmacuetical Research and Manufacturers.

Nonetheless, CBS points out a potential paper tiger to leave the message that the plan is no good. The “media is the message” even if it is a lie.

“But Azar and others have shed little light on exactly how this change would take place, leaving patients worried about the potential for astronomically higher out-of-pocket costs”.

The plan is there. CBS news has not read the plan.

“Medicare Part B presently creates incentives for doctors to purchase more expensive drugs to get a higher dollar profit”

This is a negative incentive that the President promised to eliminate. Physicians to not profit from higher drug prices. In the case of the flu shots pharmacies and supermarket pharmacies administering the flu shots profit.

“Azar said; it will create incentive for insurance companies and PBMs in Medicare Part D to negotiate discounts and lower prices and pass them on to patients.”

President Trump said he promises to eliminate the extreme profit the pharmacy benefit managers take from the system.

The New York Times took a different negative slant in order to criticize Present Trump.

“President Trump has the power to sink pharmaceutical stocks with a single jab about high drug prices.”

“But in a much-anticipated speech on the topic on Friday, Mr. Trump largely avoided the issues the industry fears the most, such as allowing Medicare to directly negotiate drug prices, or allowing Americans to import drugs.”

President Trump’s plan is to force pharmacy benefit managers to negotiate the best price for Medicare and patients with private insurance in a free market system and not in a government controlled system.

The government negotiates much lower drug prices for itself in the military and VA systems. The drug companies just cost shift and charge the rest of us a higher price

“Investors noticed: Stocks of major drug companies rose after his speech, as did those of pharmacy benefit managers, or the “middlemen” that Mr. Trump said were getting “very, very rich.”

Last weekend I asked a retired friend what he thought of the Trump plan. He said President Trump is going to make the drug companies and the pharmacy benefit managers very, very, rich.

This is regurgitation of the NY Times coverage from a well-educated man. The media is the message!

 

Time Magazine coverage was no better. It, too, was anti-Trump. Time Magazine did not bother to understand that the Trump drug program is a free market system without cronyism.

“ President Donald Trump’s long-promised plan to bring down drug prices would mostly spare the pharmaceutical industry he previously accused of “getting away with murder.” Instead he focuses on private competition and more openness to reduce America’s prescription pain.”

Why can’t the media discuss the facts and let us decide what will work or not work? What is wrong with competition? It works. Government control doesn’t seem to work.

“The administration will pursue a raft of old and new measures intended to improve competition and transparency in the notoriously complex drug pricing system.”

“But most of the measures could take months or years to implement, and none would stop drug makers from setting sky-high initial prices.”

I believe the public is starting to see how the traditional media does not want to understand President Trump’s proposal or how President Trump is going to execute on his promises.

“Trump called his plan the “most sweeping action in history to lower the price of prescription drugs for the American people.”

“But it does not include his campaign pledge to use the massive buying power of the government’s Medicare program to directly negotiate lower prices for seniors.”

Actually President Trump’s drug plan does use the massive buying power of the Medicare program to negotiate lower prices for seniors. He is doing it indirectly but through a free market system.

The traditional media’s prime focus is to criticize President Trump’s programs regardless of the facts.

In fact, with his drug plan, President Trump has published a blueprint that is going to change the metrics of how drugs are priced. His plan will make prices transparent to patients and physicians.

Patients will be given the choice to pick the best price. Physicians will be given the choice to decide if the price charged for new medication is worth the increase in price.

President Trump is going to eliminate the present failed system of pricing medication. It has not worked for consumers.

His blueprint cannot be evaluated in the context of the present pricing system.

I will describe the potential for improving the system with his blueprint in my next article.

All I can say at this point is let us see what is going to happen.

 

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.



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Another Fabulous Father Son Weekend

Stanley Feld M.D.,FACP,MACE

Brad and I get together for a father and son weekend each year.

Some of my readers have the impression that we always go to the Consumer Electronic Show in January.

We have gone to a couple of CES because I like seeing the new electronics that are offered.

This year Brad wanted to go to the place where he was born. He was born in 1965 on Blytheville Air Force Base, the home of the 851st Medical Group.

I was stationed at Blytheville Air Force Base from 1965-1967 as a Captain in the Air Force and chief of medicine of its hospital.

Blytheville map

Arkansas International Airport is the old airstrip for the Strategic Air Command base. Brad and I landed there.

 

Cecelia found the hospital bill for Brad’s birth a few years ago. The total bill was 15 dollars

The hospital was a thirty-bed acute care hospital with all the modern equipment for 1965.

B hospital 2018 copy

The hospital seemed much prettier in 1965. There is total rumble within its wall now.

 

Life on the base was great for all of us. It was the first time I made a living wage.

I remember Cecelia walking through this front door with Brad in her arms after he was born to take him to our base housing.

Blythville hospital door

What a thrill to see them walk out of the hospital.

We spent a lot of time playing with Brad in the front of our house at 1924 A Dogwood Dr. Our back yard faced the airfield.

Blytheville in front of 1924 B (1) copy
Cecelia, Brad and Stan. Brad’s 6 months old.

Brad fun on swing Blytheville 1966 copy

Brad at 8 months

Brad and me Blytheville 1965 copy copy

Brad 12 months and me 1966

Brad and I think we found our house during our visit. However, it was impossible to tell. All the street names have been changed.

Blytheville house

This might have not been the actual house but is was the actual configuration.

The government closed the base in the 1998 and gave it to a non-profit charity. Westminster Village of the mid South is now a non-profit a retirement community designed for people 55 years and older with affordable housing. The oldest resident is 101 years old. He is independent and weekly drives himself to a local casino.

All 400 houses on the base were the same. They were duplex Capehart Housing. I flagged down a woman driving a car. She would not take us to see her house. She called the security guard for us. He brought us to the village manager’s office. The manager took us to a guesthouse that had the same configuration our house on 1924A Dogwood Dr.

I showed Brad his first bedroom.

Brad first room repurposed copy 3

This was the place of Brad Feld’s first bedroom. It has obviously been redecorated.

After visiting the remaining notable sites on the base we headed into downtown Blytheville. I could not remember anything about downtown Blytheville except the New York Store. I bought my first Harris tweed jacket in that store fifty-three years ago. It still fits. I wear it on cold winter nights in Dallas.

I was thrilled to visit Blytheville Arkansas.

I know Brad was thrilled with our visit.

Next stop Memphis Tennessee. Brad was hungry so we stopped in Osceola, Arkansas. I could not find the famous Dixie Pig in Blytheville.

After lunch we were on our way to the Hotel Napoleon in downtown Memphis. We checked in and immediately headed for a 4 PM appointment at Sun Studio, the birthplace of Rock and Roll. We did not have an appointment but thankfully they were able to assign us to the 4.30 PM group.

Sun studio copy

Sun Studio is a fascinating place. “Sun Studio is known worldwide as “The Birthplace of Rock’n’roll”.

“ It is the discovery location of musical legends and genres of the 50’s from B.B. King, Howlin’ Wolf and Ike Turner and Elvis Presley to Johnny Cash and Jerry Lee Lewis; from Blues and Gospel to Country and Rock’n’roll.

  Sun studio tickets copy                  Sun studio crowd

One can buy all the old original 45s

 

Sun Studio is a small place with all the memorabilia Rock and Roll freaks only can love.

Sun studio museum copy

Sam Phillips the owner rejected Elvis at first because he was too ordinary. He wanted a new sound. Elvis sang tunes he thought would please Phillips.

When Phillips left the room Elvis started singing tunes he liked to sing. Bingo!, Sam Phillips heard Elvis’ tunes and hired him on the spot. The rest is history.

 

Brad and I did not have our traditional hot fudge sundae. We settled for chocolate ice cream malts at the Sun Studio soda fountain.

We both needed a rest. It was pouring rain outside so rather than walk in the rain we got an Uber to take us to the Hotel Napoleon.

 

Dinner was on Beale Street. Beale Street is exciting. It is a little like Nashville’s Music Street and New Orleans condensed into one city block.

We ate in the BB King building’s top floor at Itta Bena. The live blues music during dinner was wonderful. I had lamb chops. They were great.

http://ittabenadining.com/memphis/?utm_source=tripadvisor&utm_medium=referral

After dinner we walked Beale Street.

Beale St copy

 

 

We stopped into A. Scwab a trading store that was established in 1878 for a real hot fudge sundae.

Soda fountain schwab

Soda fountain big scwab copy

 

 

“In 1876, Jewish immigrant Abraham Schwab opened a store on Beale Street.

Over its 138-year history, A. Schwab has become a Memphis institution, beloved by many generations.

  1. Schwab is the only original business remaining on Beale Street.”

It was time to go to sleep. Tomorrow, “We are going to Graceland, Graceland in Memphis Tennessee”.

Graceland is one of the places I have never gone too. I am excited because Elvis was “my man.”

To my surprise Graceland was overwhelming.

Graceland entrance copy

The entrance with gift shops, memorabilia and Eliv’s car collections, clothing collections, electronic collections, airplane collection and auto collections are housed across the street from the mansion. I could spend hours there. We only spend two hours going over the collections.

The Mansion copy

Elvis bought this house in 1957. It was 7,000 square feet. He extended the house to 17,000 square feet. He liked a lot of rooms with a lot of different themes.

Elvis price 1957 copy

He paid $102 500 for the house and 7 acres. The house original cos Dr T Moore 37,636, in 1937.

Cost of graceland 1937 copy

 

Elvis livis room copy

This is the living room at Graceland. It is a little loud but wait until you see more.

Elvis bedroom copy

This was his bedroom. Purple is a good color for a bedspread in the 1950s.

Fun room copy

This is a billiards room and meeting room. Elvis was into color.

Elvis playroom

This was Elvis’ playroom. I still have not figured it out.

Media room copy

This is the media room. He have multiple TV. Everyt ime RCA came out with a new one he good it. His love of music resulted in his buying every new media gadget. He love all the electronics of the time.

 

Elvis was a good looking guy who who was a man of the 1950s and 1960s

He was not a hick copy Another one copy

He knew how to dress when it was appropriate.

He was a great collector of cars, electronics and man toys.

Neet toy

Here is one of the toys he drove around Graceland.

 

His plane copy

Here is a toy he would fly around the word in

That is it folks

That is it folks. 

I apologize for not discussing all the chocolate ice cream on this trip. Let me just say we had plenty. We covered every meal.

Except there is one last thing.

Brad gave me a party present for my love of Elvis and his music.

Me in elvis outfit Back of jumpsuit copy

It is a little big on me because he bought an xx large but some safety pins got it to be presentable.

 

Daniel asked me if we could revisit his birthplace in Boston on one of our next father-son weekend trips. Who could blame him. My answer was why not?

I always have a fabulous time on my weekends with one of my sons.

Remember I lived in Boston for two years when I was an endocrine fellow at the Mass General. I know most of the fun places especially Fenway Park.

Daniel, Boston it is.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.



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  • Todd Siler

    Stanley, this post beams with pure JOY! Your photos and story of this inspirational adventure with Brad are unforgettable! Surely, you made the spirit of Elvis smile watching you embrace Graceland with so much love!

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Here They Come Again

Stanley Feld M.D.,FACP,MACE

Democrats have tried to pass a single party payer healthcare system since 1935. Slowly, but surely, the American population has been indoctrinated into believing that a single party payer system run by the government is the best healthcare system to have.

Americans have been filled with disinformation about the wild successes of single party payer systems in the rest of the world.

The economics of these single party payer systems are seldom discussed in a coherent way. The American public has no idea of its economic burden to its countries.

The fact that these governments continue to raise taxes to pay for their single party payer system while decreasing their citizens’ access to care is hardly ever discussed. Only the favorable statistics that fit the progressive narrative are published.

In Norway the income tax rate is 50%. This is mostly because of its universal single party payer healthcare system. Norwegians seem happy with the system. If they get sick they have nothing to worry about. Their health care is free.

The fact is nothing is free and only 20% of the population interacts with the healthcare system at any one time.

In Britain taxpayers are unhappy with the National Health Services. Consumers recognize the bureaucratic waste in their healthcare system. They also suffer from decreased access to care. Wait times for health care and surgery are ridiculously long.

The private healthcare system is flourishing in Britain for those who can afford it.

The British healthcare system is unsustainable. The British government cannot figure out how to make it more efficient.

America has a single party payer system for Medicare, Medicaid, SCHIP and the VA system.

Seniors love Medicare. They could not afford to get treatment if there was not a Medicare System. Policy wonks and Democrats refuse to recognize that in 1965 after Medicare was enacted, healthcare prices exploded. The price of healthcare has continued to explode yearly.

Congress has ignored the basic defects that have caused this explosion. A few congressmen are making feeble attempts to correct this continuing price explosion.

The political establishment largely ignores these congressmen.

As attempts are made to try to control costs through regulations the bureaucracy grows and the system becomes more inefficient. The reduction of reimbursement to physicians has resulted in the explosion of concierge medicine.

The result is an increase in costs and greater opportunity for abuse by the insurance industry, the pharmaceutical industry, hospitals and healthcare providers and government.

Medicaid has experienced the same increasing costs. It also created a shortage of physicians because of low reimbursement. Obamacare has expanded Medicaid. This has decreased the availability of medical care for Medicaid patients.

President Obama’s law increased the number of Medicaid recipients but did not cure the reasons for the lack of providers. Many clever Medicaid providers have figured out how to exploit Medicaid rules only to suffer from investigations and government penalties in the long run.

The VA system is the purest example of sheer failure. Not only are the patients unhappy but the providing administrative bureaucracy is riddled with inefficiency, corruption and waste.

The inefficiency, corruption and waste have not been able to be fixed but many notable private sector executives. They have all ultimately resigned or were fired.

The VA system’s single party payer system remains an incurable failure.

These examples have proven to me that a single party payer system is unsustainable and not economically feasible. The government continues to make the same mistakes over and over again.

Are these mistakes intentional?

The government’s goals are to gain power and have control over the population. If its goals were to have an efficient and effective healthcare system, it would provide the resources to permit all consumers to drive the healthcare system. It would create a system that would motivate consumers to be responsible for their healthcare.

What is happening now?

The healthcare policy ideologists are using the New York Times as their propaganda vehicle to promote a single party payer system.

The article, Back to the Health Policy Drawing Board” is intellectually simulating to readers of the Sunday Times. However, many of its details are untrue.

After one casually reads the article on a pleasant Sunday morning it would seem much simpler to have a single party healthcare system controlled by the government than the chaotic system that presently exists.

However, the cost of the Medicare system is out of control. America cannot continue to print money forever. America’s political class is ignoring this fact.

It is so out of control political wonks are starting to talk about having another Debt Jubilee.

https://en.wikipedia.org/wiki/Jubilee_Debt_Coalition

The New York Times article starts by saying:

The Affordable Care Act needs help.

It sure does. The problem is there are too many defects in the structure of Obamacare that led to the increases in costs to the government and consumers. Obamacare is beyond repair.

After scores of failed repeal attempts, Congress enacted legislation late last year that eliminated one of the law’s central features, the mandate requiring people to buy insurance.

There was only one failed repeal attempt not scores of repeal attempts. The one repeal attempt failed by one vote. It seemed to me to be a vindictive vote. It was not on the bills lack of merit. It seemed to me to be on John McCain’s personal animosity toward President Donald Trump.

There has been a total lack of bipartisanship in trying to repair Obamacare. The have been no ideas offered by Democrats. Its goal was to stymie the Republican administration.

Many establishment Republicans’ goal was to also stymie the Republican administration.

Obamacare had three principal features:

  • Insurers could not charge higher prices to people with pre-existing conditions.
  • Those without coverage had to pay a penalty to the government (the “mandate”).

President Trump slipped the elimination of the mandate into the tax bill to bring a speedier death to Obamacare.

  • Low-income people would be eligible for subsidies.

Each feature represented a death bell from the onset

A June 2017 poll showed that 60 percent of Americans said the government should provide universal coverage, and support for single-payer insurance rose more than one-third since 2014.

Americans are frustrated with the dysfunction in the healthcare system. Premiums have increased tremendously since Obamacare. Its regulations and defective principles increased dysfunction.

Enormous deductibles have resulted in individual buying defective insurance policies. Consumers have ended up with essentially no insurance coverage except for catastrophic illness. Only people at risk for high cost treatment have bought these policies.

I cannot imagine what the 60% who want a single party payer were thinking. Can a government run system improve the inherent inefficiency, waste, abuse and unsustainability of Obamacare or a VA like healthcare system?

A government run single party payer system can only make things worse.

The healthcare system will not improve until congress acts to level the playing field and fix the defects inherent in our present healthcare system.

I believe a universal consumer driven healthcare system, available to all, can “Repair the Healthcare System” at a much lower cost to society and individual consumers than a single party payer system.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone

 All Rights Reserved © 2006 – 2018 “Repairing The Healthcare System” Stanley Feld M.D.,FACP,MACE

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How Jeff Bezos, Warren Buffett and Jamie Diamond Can Disrupt The Healthcare System

Stanley Feld M.D., FACP,MACE

Jeff Bezos, Warren Buffett and Jamie Diamond should try this disruptive approach in their venture into healthcare reform.

All the other approaches that have been tried have not worked or have become unsustainable. Most of the approaches have been unfair to consumers and the majority of taxpaying Americans.

The only way to empower all the consumers in a healthcare system is to encourage them to become responsible for their health and healthcare dollars.

I believe it can only be accomplished by providing easily understandable financial incentives for consumers to save money for themselves.

Providing financial incentives to consumers to save money for themselves can be disruptive to the present models used to pay for medical services just as Amazon has been disruptive to retail sales.

The delivery of medical and surgical care has advanced tremendously in the last sixty years.

At the same time medical care has become unaffordable and the cost of healthcare has become unsustainable.

The incidence of obesity has risen every year. Over fifty percent of Americans are obese.

Obesity begets many chronic diseases and subsequently the complications of these diseases.

Physicians can treat these complications fairly well. However the treatment of chronic disease complications are costly.

How do you decrease the incidence of obesity in America?

Physicians must attack the core causes of obesity.

Among those causes are excess food intake, lack of daily exercise, mental depression, cultural milieu and/or a combination of all of the above.

The cure of obesity depends on the ability to eliminate these core drivers. Financial incentives can get patients involved in eliminating the core drivers of obesity.

The responsibility for obese patients’ healthcare depends on patients’ lifestyle, popular cultural milieu, and patient education.

In America, it is almost impossible to buy a meal in any level restaurant without excess calories.

How do you get people to be responsible for their health and healthcare dollars?

The one key element ignored by policy makers to decrease obesity is to give obese consumers of healthcare financial incentives to concentrate on trying to lose weight.

Obamacare went in the wrong direction. It limits personal liability for their obesity. It does not promote personal responsibility

The only incentive Obamacare provided was the incentive to overuse the healthcare system.

This was especially true for patients on Medicaid. They had zero premiums and deductibles. The only deterrent to accessing medical care was physician availability.

Physicians refused to participate in Medicaid because of low professional reimbursement. Low reimbursement by the government was necessary because of the decreases in funding and participant overuse of the system.

Obamacare planned to cure the shortage of “medical providers” by increasing the number of “valid medical providers” who could bill on their own, such as nurse practitioners and certified physician assistants.

However, the defect there is that patients were not under the supervision of physicians engaged in their care. It ignores the patient physician relationship that is so important to effective medical care.

If Jeff Bezo, Warren Buffet and Jamie Diamond (BBD group) are serious about Repairing the Healthcare System for their employees as a nonprofit organization, they should consider my Ideal Medical Savings Account.

http://stanfeld.com/?s=My+Ideal+Medical+Savings+Account

The Ideal Medical Savings Accounts (MSA) are tax-sheltered accounts used to pay for non-catastrophic medical expenses. These non catastrophic medical expenses account for the bulk of the cost of medical care.

Money left from the Medical Savings Account at the end of the year is put into a consumer’s retirement account.

The MSA provides the financial incentive to not overuse the healthcare system.

Warren Buffet understands the money making potential of re-insurance. He is heavily invested in re-insurance companies.

If one of the BBD Groups employee’s gets sick and spends of all of his MSA money, reinsurance provides first dollar coverage for the illness.

The BBD Group could teach employees how to shop for price and value. Insurance companies are supposed to shop for value. However the shopping is never to the patient’s advantage. It is to the advantage of the insurance company.

 Critics always claim this is unrealistic:

  1. The claim is that patients are not smart enough to shop for price and value. 2. Are you supposed to shop around from the back of the ambulance?

 The critics’ use the ambulance argument to eliminate the possibility of consumers using their own judgment to make price decisions.

Patients are smart enough to figure out which hospital they want to go to before they get into the ambulance.

Emergency care represents only 6% of health care expenditures.

But emergency care represents only 6% of health expenditures.”

“For privately insured adults under 65, almost 60% of spending is on elective outpatient care. “

ttps://www.wsj.com/articles/the-health-reform-that-hasnt-been-tried-1507071808

The critics argument is that consumers do not know how to shop prices. Consumers are smarter than the critics think. It would be easy to teach consumers to shop prices.”

ttp://stanfeld.com/the-failure-of-the-republican-establishment-to-repeal-and-replace-obamacare/

“My Ideal Medical Saving Account provides that financial incentive to not overuse the healthcare system. All the articles about my ideal medical saving accounts are attached to this link.

http://stanfeld.com/?s=My+ideal+Medical+Savings+Accounts

 Likewise, nearly 60% of Medicaid money goes to outpatient care.”

 Medicaid patients also overuse the healthcare system.

Most Medicaid patients can understand the MSA’s financial incentive.

“ For the top 1% of spenders—a group responsible for more than a quarter of all health expenditures—a full 45% is outpatient.”

These patients can be identified as outliers and educational vehicles can be created to decrease this overuse of the system. It would save the re-insurance company a great deal of money.

In my opinion Medical Savings Account are better than Health Savings Accounts. Medical Savings Accounts take the money out of the healthcare insurance company’s hands and deliver it to consumers retirement accounts.

Both HSA’s and MSAs have the unique advantage of providing the financial incentive to for consumers to save money for themselves.

When people have savings to protect in HSAs, the cost of care drops without harmful effects on health. 

 The financial incentives decrease the overuse of the healthcare system.

According to a 2012 study in Health Affairs if even half of Americans with employer-sponsored insurance enrolled in this kind of coverage, U.S. health expenditures would fall by an estimated $57 billion a year.”

 https://www.healthaffairs.org/do/10.1377/hpb20160204.950878/full/

 My ideal Medical Savings Accounts provide an even a greater financial incentive and should decrease costs even further.

“ MSAs should be available to all Americans, including seniors on Medicare. Given that seniors use the most health care, motivating them to seek value is crucial to driving prices lower.”

MSAs should also apply to Medicaid recipients. The details for Medicaid recipients can be found in my article “My Ideal Medical Savings Accounts Is Democratic. “

The maximum contribution to MSAs should be raised to $6000 or $7000 dollars. If a consumer gets sick and experiences a cost of more that $6000 he should receive 100% (first dollar) coverage through the BBD group’s provided reinsurance policy. A reinsurance policy would cost the BBD Group less than $6000 a year.

The total insurance package to BBG Group employees should cost the BBD Group $12,000 rather than the present cost of $18,000.

BBD is a self insured association. The association has elimated the multiple middlemen in the present healthcare system.

 When a person with an MSA dies, the funds should be allowed to roll over tax-free to surviving family members.

This financial incentive should be included in My Ideal Medical Savings Account.

“The information that patients require to assess value must be made more transparent. 

2014 study on magnetic resonance imaging showed that price-transparency programs reduced costs by 18.7%.”

A consumer driven system would force providers to compete for patients. Information on price could easily be provided to consumers by the government and the healthcare insurance industry.

At present healthcare prices are not transparent. Consumers are not motivated to shop prices. The BBD Groups leverage with its employees would force transparency.

“The most compelling motivation for doctors and hospitals to post rates would be knowing that they are competing for price-conscious patients empowered with control of their own money.”

 In this age of technology and rapid communication telemedicine should be promoted and paid for. One way to do it is to permit physicians to practice telemedicine across state lines. It would supply instant access to expertize at an affordable cost.

Everything possible should be done to encourage consumer responsibility and provider competition.

The present tax code does the opposite. Consumers in-group plans provided by large and small corporations receive their healthcare insurance from the corporation with tax-free dollars.

The larger the corporation the more leverage the corporation has for negotiating the premiums with the healthcare insurance companies.

The BBD Groups volume of consumers would have tremendous leverage with providers.

The younger and healthier the corporate employees are the lower the premiums.

The formation of associations with large memberships of all ages would lower the cost of healthcare. Large associations would have great leverage in negotiating price with providers. They would also spread the risk.

Self- insured associations such as the BBD Group would also spread the risk and lower the cost.

Tax deductibility must be given to these “individual” insurance policy holders and association policy holders so they are, in reality, paying for healthcare insurance with pre-tax dollars the same as the corporate group plan policy holders.

These simple changes in the law would result in an affordable healthcare system that was market driven by consumers. The changes would force providers and the healthcare insurance industry to become competitive.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone

 All Rights Reserved © 2006 – 2018 “Repairing The Healthcare System” Stanley Feld M.D.,FACP,MACE

 

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The Healthcare System Needs Disruption

Stanley Feld M.D.,FACP,MACE

The announcement that Amazon.com, JP Morgan Chase and Berkshire Hathaway are forming a non-profit company to try to improve the American healthcare system caused some ripples in the stock market.

The mere specter of its disruptive potential was enough to send some investors scurrying away from large payer providers like UnitedHealth, Aetna and Humana.

The reason for the panic is obvious. These large insurance companies have been ripping off the healthcare system for decades. They have had their fortunes improved with Obamacare and its regulations. They are afraid they are going to lose their stronghold.

The three innovations, Jeff Bezos, Warren Buffet and Jamie Diamond are disruptors that might destroy UnitedHealth, Aetna, and Humana’s kingdom.

Mitch McConnell has supposedly taken Repeal of Obamacare off the agenda for 2018.

I believe Mitch McConnell doesn’t know what to do about Obamacare. He is hoping that it fails on its own. He has passed the budget that will force the government to cover the tremendous financial short falls the defectives in the structure of Obamacare is going to precipitate.

Only then will the public hear about Obamacare’s effect on America’s budget deficit.

The American taxpayer will be force to continue to fund this failed program.

Obamacare has failed because of its structure. It encourages over use of the healthcare system by sick people. It does not encourage consumers to be responsible for their health and healthcare dollars.

The Democrats and the Republican establishment have failed the American consumer again.

Bravo to three of America’s premier disruptors Jeff Bezos, Warren Buffet and Jamie Diamond.

If they bother to understand the elements of medical care and the reasons for the healthcare systems dysfunction they have a chance for success.

If they follow the previous attempts to repair the healthcare system by the government, healthcare insurance industry and hospital systems they will fail miserably just as these other institutions have failed.

“The industry certainly offers plenty of opportunities for reinvention, of course. Healthcare in the United States is expensive, and its quality varies wildly.” says Christopher Rowe, managing director at Korn Ferry.

Jeff Bezos has the best shot at reducing drug price significantly. The government cannot negotiate prices. The private carriers through drug benefit plans do a little better.

The military and the VA system do 30 to 75% better than Medicare Part D and the private sector.

Jeff Bezos knows how to market via the Internet. With the large cadre of consumer employees of Jeff Bezos Warren Buffet and Jamie Diamond, Mr. Bezos can probably negotiate the drug prices down by at least 50%. I’ll bet he can negotiate drug prices almost as low as the VA system and also provide the pharmaceutical companies an increase in reimbursement for their drugs.

Mr. Bezos usually eliminates most of the middlemen. He will be able to offer the medication at a 40 or 50% lower price than Medicare Part D and the private benefit managers and still make a sizable profit while providing a better quality of service.

He knows the customer is the consumer.

When it comes to the delivery of medical care and the use of technology in the delivery of medical care, I am not sure Bezos, Buffet and Diamond know who the real customers are.

I am not sure they know how to get around the stronghold the healthcare insurance industry, the federal government and the hospital systems have over the control of healthcare.

Many other corporations have tried to break the stronghold and have failed.

I will try to tell Jeff Bezos, Warren Buffet and Jamie Diamond what they have to do in my next blog.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone

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