Economic downturns and upswings occur over and over again. Economists believe both downturns and upswings can be managed. However, economists continue to make the same policy mistakes. The mistakes result in an increase in depth and frequency of the economic swings.
Businesses both large and small and consumers are frustrated and angry about the present economic downturn and its prolonged continuation.
President Obama thinks his ideology is correct. However, his philosophy is flaming the fires of racial and economic divisions and unrest. His ideology is prolonging and increasing the depth of this economic downturn.
Before I present a systemized solution to the dysfunction of the healthcare system, I feel compelled to put the economic, political and social crisis in into a systems error perspective.
The national deficit is exploding because of excessive government spending. None of President Obama’s economic stimuli have worked.
Economic uncertainty is increasing as a result of the unintended consequences created by the thousands of new regulations produced by the Obama administration’s bureaucracies. The regulations are written at the discretion of non-elected government officials.
American businesses and the American people mistrust government more and more. Powerful vested interests influence government policy to their advantage.
Congress and the President were elected “by the people for the people.” The government has gotten too large. The government does not seem to be working in the interest of the people who voted for them.
In 1957 Ayn Rand having experienced a totalitarian government in her native Russia was upset by the trend in America. This resulted in her writing Atlas Shrugged.
Right now President Obama’s ever-increasing bureaucracy and government control over every aspect of our lives is reminiscent of “Atlas Shrugged.”
Milton Freidman pointed out that Keynsian economics does not work. All the World’s societies run on greed. The trick is to harness greed for the common good.
Big government generates large bureaucratic structures. Large bureaucratic structures do not fix anything. They make systems more complex and more difficult to manage.
This is what is happening with the bureaucratic structures being formed by Obamacare. More departments are created. People running these departments have independent power. Multiple independent departments lead to multiple contradictions. The contradictions lead to greater costs to the system and added dysfunction.
The Department of Human Services and CMS is such a system. It has become a monster bureaucracy with the enactment of Obamacare.
Look at the names of some of the agencies created. They are right out of "Atlas Shrugged."
I recall President Reagan’s famous statement, “I am from the government and I am here to help.”
The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.
Paul Ryan and the Republican House passed the 2012 budget that has been ignored by Harry Reid and the Senate. Harry Reid gets his orders from President Obama. He chose not to consider the Republican House budget. Instead Democrat chose to demonize Paul Ryan.
President Obama seems to be ignoring America’s debt and deficit spending crisis. The Senate has not produced a budget in over 900 days. President Obama has presented numbers to the CBO that would result in decreasing the budget deficit. The numbers presented to the CBO are phony. The Healthcare Reform Act will result in a huge increase in our deficit. It will result in higher taxes.
The traditional media has been very effective in demonizing Paul Ryan’s budget proposal.. The TV ad implying that Paul Ryan is pushing grandma off the cliff is a total lie. The media should fact check before accepting an inaccurate advertisement .
If anything, President Obama’s Healthcare Reform Act will push grandma off the cliff.
Paul Ryan’s explanation of our debt crisis and deficit spending is clear. His budget proposal is also clear.
Paul Ryan questions the reasons President Obama and the Democratic Senate are ignoring the coming disaster.
The healthcare system is inundated with waste, fraud, abuse, a lack of competition and well-directed incentives for the healthcare system to function efficiently.
President Obama’s healthcare reform law is awash with penalties, punishment and rationing as well as waste in the form of more bureaucracy, committees, studies and pilots. Medicare is unsustainable.
The healthcare insurance industry has figured out how to profit from the proposed ACO (Accountable Care Organizations). It means more bureaucracy resulting in higher fees to charge the government for providing administrative services. The result will be higher unsustainable costs for both the government and seniors.
Hospital systems know are not prepared for ACOs. ACO’s are too costly to set up. Most hospital systems information systems are not good enough to provide the data the government wants to evaluation the care given. Administrators managing hospital systems intuitively know that the government will make decisions that will be counter to hospital systems’ vested interests.
Physicians know that hospital systems are going to try to capture as much of their intellectual property as possible and restrict their freedom to make medical judgments. It will be very difficult to create physician hospital alignment under an ACO.
This is a must watch You Tube
Patients know ACO’s are going to restrict access to care, increase their out of pocket expenses, ration care and result in higher taxes and higher deductible. Partial implementation of President Obama’s healthcare act already has resulted in all of the above.
Hospital systems and physicians have not signed up for ACO’s. That resulted in Dr. Don Berwick and CMS revising their ACO final rules. Dr. Berwick is trying to entice hospital systems and physician groups to sign up and form ACO’s.
Dr. Berwick says he is for patients, hospital systems and physicians delivering better care to patients. I believe him. However, he is doing it the wrong way.
The only thing the new rules accomplish is to make forming an ACO more affordable at the front end. Medicare ACO’s continue to be a government controlled system with penalties and punishments to providers.
Patients’ treatments will be determined by a non-elected committee and not their physicians. The committee might make the wrong decision by examining the wrong data.
There was not one urologist on the committee. Another example was the USPSTF task force studying osteoporosis and the use of bone mineral density in men over 70. There was not one Clinical Endocrinologist on the committee.
All anyone has to do is go into any Wal-Mart on a Monday morning. At least 50% of males over 70 years old look like they have lost several inches of height. Each of these men has osteoporosis. They are at risk for hip fractures. Hip fractures at the least with decrease quality of life. At most, long hospitalization and death. Hip fractures can be prevented if treated properly.
The next step would be to study the number of hip fractures in men over 70 years old and the cost of treatment of these fractures. An evaluation of the quality of life after fracture must be evaluated to get an accurate assessment of the cost effectiveness of doing bone mineral density testing.
Medical care systems must be a patient centered and controlled. It must not be a government centered and controlled system. This is the only way to develop a cost efficient system. Dr. Berwick’s way will only increase the cost to the government. He will spend money the government does not have.
The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.
I wonder how many Congressional Representatives and Senators read HR3200. It is amazing that our representatives would permit the federal government to restrict our freedoms so severely.
This morning I received this You Tube from a reader. It describes the restrictions on our freedoms created by President Obama’s healthcare reform plan. The restrictions have not be publicized by the traditional media.
I was reminded of the blog I wrote on July 30,2009. Below is the link to the original bill and a copy of my 2009 blog.
It is easy to forget all the restrictions imposed on Americans’ freedoms by this piece of legislation.
On Thursday, Oct 20, 2011 at 8:52 AM a reader sent this You Tube and comment
"This has to be one of the scariest pieces I've seen. If you have the stomach, take the few minutes to review. Maybe even compare the statements with the actual bill." Here's the link to HR3200:
I have compared the You Tube to the original bill. Obamacare is defective. Americans will not tolerate centralized control over our lives and choices once they understand the concepts in the bill.
President Obama has been effective in manipulating the media to keep Americans in the dark.
The House of Representatives Healthcare Bill is 1018 pages long. Many Representatives and Senators did not read the entire economic stimulus bill because “we did not have time” before we experienced a severe economic recession. They claimed to be saving us from another great depression.
I have read a good portion of HR3200. The provisions are unacceptable and sinister. It represents a complete government takeover of our healthcare system. It is not in the interest of the consumer. It is not in the interest of our precious freedom of choice.
Every Americans, especially our Senators and Representative must know what is actually in the bill before it is passed. President Obama’s generalities do not cover the details of HR 3200.
Mr. Schweikart evaluated 498 of the 1107 page bill. The summary of one half HR3200 is frightening. His summary is a good reference guide to the appreciation of the harshness of the bill. It also explains President Obama’s urgency in getting a bill passed before anyone realizes the implications of the bills contents.
Representatives who vote for this bill should not be reelected. They are not representing their constituents’ rights or protecting their freedoms. Your healthcare, health and freedoms are at stake.
You can check the reviewer’s summary against the actual bill at the link below.
“Take a look at what actually is in the Health Care bill. Obama makes disingenuous comments like "You'll still keep your doctor" or "You'll keep your existing health care."
Pg 22 of the HC Bill mandates the Government will audit books of all employers that self insured. Can you imagine what that will do to small businesses? Everyone will abandon “self insurance” and go on Government insurance. So when Obama says that there will still be private health care, it’s simply a lie: this mandate will force employers to abandon their private plans.
Pg 30 Sec 123 of HC bill – a Government committee will decide what treatments/benefits a person may receive.
Pg 29 lines 4-16 in the HC bill – YOUR HEALTHCARE WILL BE RATIONED!President Obama has been saying healthcare is to be rationed all along in code.
Pg 42 of HC Bill – The Health Choices Commissioner will choose your HC Benefits for you. You will have no choice!
Pg 50 Section 152 in HC bill – HC will be provided to ALL non US citizens, illegal or otherwise.
Pg 58 HC Bill – Government will have real-time access to individual’s finances and a National ID Healthcard will be issued! Government has real-time access to your tax return presently and means test Medicare recipients’ premiums
Pg 59 HC Bill lines 21-24 Government will have direct access to your bank accts for election funds transfer. A further impingement on freedom and privacy.
Pg 65 Sec 164 is a payoff subsidized plan for retirees and their families in Unions & community organizations (read: ACORN).
Pg 72 Lines 8-14 Government will create an HC Exchange to bring private HC plans under Government control.
Pg 84 Sec 203 HC bill – Government mandates ALL benefit packages for private HC plans in the Exchange.
Pg 85 Line 7 HC Bill – Specifics of Benefit Levels for Plans = The Government will ration your Healthcare!
Pg 91 Lines 4-7 HC Bill – Government mandates linguistic appropriate services. Example – Translation for illegal aliens.
Pg 95 HC Bill Lines 8-18 The Government will use groups, i.e. ACORN & AmeriCorps, to sign up individuals for Government HC plan.
Pg 85 Line 7 HC Bill – Specifics of Benefit Levels for Plans. AARP members – your Health care WILL be rationed.
Pg 102 Lines 12-18 HC Bill – Medicaid Eligible Individuals will be automatically enrolled in Medicaid. No choice.
Pg 124 lines 24-25 HC No company can sue Government on price fixing. No "judicial review" against Government Monopoly.
Pg 127 Lines 1-16 HC Bill – Doctors/ AMA – The Government will tell YOU what you can earn.
Pg 145 Line 15-17 An Employer MUST auto enroll employees into public option plan. NO CHOICE.
Pg 126 Lines 22-25 Employers MUST pay for HC for part time employees AND their families.
Pg 149 Lines 16-24 ANY Employer with payroll $400k & above who does not provide public option pays 8% tax on all payroll.
Pg 150 Lines 9-13 Businesses with payroll between $251k & $400k who don’t provide public option will pay 2-6% tax on all payroll.
Pg 167 Lines 18-23 ANY individual who doesn’t have acceptable HC according to Government will be taxed 2.5% of income.
Pg 170 Lines 1-3 HC Bill Any NONRESIDENT Alien is exempt from individual taxes. (Americans will pay.)
Pg 195 HC Bill -officers & employees of HC Admin (the GOVERNMENT) will have access to ALL Americans’ finances and personal records. Big brother will be watching your every move.
Pg 203 Line 14-15 HC – "The tax imposed under this section shall not be treated as tax" Yes, it says that.
Pg 239 Line 14-24 HC Bill Government will reduce physician services for Medicaid. Seniors, low income, poor affected. Kill off the poor and elderly.
Pg 241 Line 6-8 HC Bill – Doctors – doesn’t matter what specialty – will all be paid the same.
Pg 253 Line 10-18 Government sets value of Doctor’s time, professional judgment, etc. Literally, value of humans.
Pg 265 Sec 1131Government mandates & controls productivity for private HC industries.
Pg 268 Sec 1141 Federal Government regulates rental & purchase of power driven wheelchairs.
Pg 272 SEC. 1145. TREATMENT OF CERTAIN CANCER HOSPITALS – Cancer patients – welcome to rationing!
Pg 280 Sec 1151 The Government will penalize hospitals for what Government deems preventable readmissions.
Pg 298 Lines 9-11 Doctors who treat a patient during initial admission that results in a readmission – Government will penalize you.
Pg 317 L 13-20 OMG!! PROHIBITION on ownership/investment. Government tells Doctors what/how much they can own.
Pg 317-318 lines 21-25,1-3 PROHIBITION on expansion – Government will mandate hospitals cannot expand.
Pg 321 2-13 Hospitals have opportunity to apply for exception BUT community input required. Can you say ACORN?!
Pg 335 L 16-25 Pg 336-339 – Government mandates establishment of outcome-based measures which of course forces health care rationing.
Pg 341 Lines 3-9 Government has authority to disqualify Medicare Adv Plans, HMOs, etc., forcing people into Government plan.
Pg 354 Sec 1177 – Government will RESTRICT enrollment of Special needs people!
Pg 379 Sec 1191 Government creates more bureaucracy – Telehealth Advisory Committee. Healthcare by phone.
Pg 425 Lines 4-12 Government mandates Advance Care Planning Consultations. Think Senior Citizens end of life prodding.
Pg 425 Lines 17-19 Government will instruct & consult regarding living wills, durable powers of attorney. Mandatory!
Pg 425 Lines 22-25, 426 Lines 1-3 Government provides approved list of end of life resources, guiding you in how to die. EVERYONE on Social Security, (will include all Senior Citizens and SSI people) will go to MANDATORY counseling every 5 years to learn and to choose from ways to end your suffering (and your life). Health care will be denied based on age. 500 Billion will be cut from Seniors healthcare. The only way for that to happen is to drastically cut health care, the oldest and the sickest will be cut first. Paying for your own care will not be an option.
Pg 427 Lines 15-24 Government mandates program for orders for end of life. The Government has a say in how your life ends.
Pg 429 Lines 1-9 An "advanced care planning consultant" will be used frequently as patients’ health deteriorates.
Pg 429 Lines 10-12 "advanced care consultation" may include an ORDER for end of life plans. AN ORDER from the Government to end a life!
Pg 429 Lines 13-25 – The Government will specify which Doctors can write an end of life order.
Pg 430 Lines 11-15 The Government will decide what level of treatment you will have at end of life.
Pg 469 – Community Based Home Medical Services/Non profit orgs. (ACORN Medical Services here?)
Pg 472 Lines 14-17 PAYMENT TO COMMUNITY-BASED ORGANIZATION. 1 monthly payment to a community-based organization. (Like ACORN)
Pg 489 Sec 1308 The Government will cover Marriage & Family therapy. Which means they will insert Government into our marriages.
Pg 494-498 Government will cover Mental Health Services including defining, creating, rationing those services. You’d better speak up now before you are on the "advanced care consultation" list.
It gets worse: the Health Care Reform bill that is now about to come up for a vote will absolutely eliminate private health care options. Do not kid yourself: They are going to say that they aren't going to interfere with your right to go to your "own doctor" or have your own "private health insurance." But there won't be non-government doctors or private health insurance if the government mandates them out of existence.
Even still, I hear people who want to "get past all this partisanship." Sorry, but GROW UP.
Our system from the beginning has pitted one group against another out of fear of the very giant government that is metastasizing before our eyes. James Madison didn't like "parties" or "factions," but he finally admitted that they were absolutely necessary to fragment power.
For our system to work there has to be a clear choice, not a mushy middle, because the mushy middle always, always, always gravitates left. There is a "presumption of power" on the left –conservatives, by nature, do not like government, don't trust it, and do not want to use it to advance their ends, which they see as advanced through liberty, individual achievement, and entrepreneurship.
It is hard to read H3200 and comprehend its implications. However, a careful reading leads me to similar conclusions to those of Mr. Schweikart.
Do you think your representatives have studied the bill? If they have and vote for it they should lose your vote. If they have not read it and vote on party lines they should lose your vote.
This bill is not going to Repair the Healthcare System. It will make the healthcare system more complex, restrict access to care, restrict the delivery of care, ration care, limit freedom of choice, and increase the deficit.
Let your Senators and Representatives know the proposals are unacceptable. Write, fax, call, email, twitter. Tell them:
“We do not want the government to control our lives. We want affordable, universal healthcare coverage that does not limit access to care. We want control over our healthcare dollars. We do not want government to control our lives and our money.”
We all agree the healthcare system is dysfunctional. As Obamacare works its way toward full implementation the dysfunction has intensified and healthcare costs have increased. It is important for all of us to recognize why Obamacare is a disaster.
Obamacare will not only destroy our healthcare system. More importantly It will destroy our freedoms.
On October 19th 2011, President Obama said his administration has done everything correctly. It just hasn’t worked out yet.
Does anyone believe him?
The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.
A good friend and fellow physician sent me this notice. This is a important public service announcement.
An individual citizen not the government initiated the program. If adoption of the program becomes a national standard, it will demonstrate people power and individual responsibility.
The key to Repairing the Healthcare System is individual responsibility. This program represents an opportunity for every individual to assume responsibility for themselves and alert everyone they know to be responsible for themselves.
A paramedic conceived ICE. At the scene of accidents he found cell phones on an unconscious victim but he could not find whom to notify.
He thought it would be a good idea if there was a nationally recognized symbol to find a victims contact person In Case of an Emergency in the victims cell phone directory.
The ICE cell phone number could be found quickly. Emergency service and hospital personal could simply dial the phone number stored under "ICE."
We all carry our mobile phones with many names & numbers stored in its memory. Nobody would know which of these numbers belong to our closest family or friends.
If "ICE" (In Case of Emergency) was a national icon close family or a friend could be notified immediately.
ICE is a great idea that can make a difference. Everyone reading this is on their computer, tablet or mobile phone. Go to your phone directory, get a number you want contacted in case of emergency and enter it as ICE. Then forward this to your email list.
It you have more than one contact name file the names in the telephone directory as ICE1, ICE2 and ICE3.
The ICE concept demands personal responsibility. Everyone should have an ICE listing in their mobile phone in case of emergency.
The power of the individual combined with the power of the internet can make ICE an instant national symbol.
I really liked this concept — it is an exceptional medium to help someone in their critical time of need. Paramedics refer to it as the golden hour though they may not even have an hour in some cases.
Thinking through, I found few glitches in its practicality; for instance, the value of ICE reference is lost if your phone is destroyed by the impact, like an accident, that caused the emergency. Read more in my blog post at: http://icecare.info/blog/2009/09/01/ice-debunked/
I still liked the idea and felt we could improvise with a little extra effort for prevalent life style; and have created a solution called ICEcare.
I am open to feedback and cooperative efforts.
This mutual distrust must be overcome and price transparency achieved before any progress can occur in Repairing The Healthcare System.
In order to achieve Pareto efficiency in the healthcare system all the stakeholders must agree to price transparency. The advantage of Pareto efficiency is that all the stakeholders will be better off in the long term while some might have to yield to some issues in the short term.
Lodi Hurwicz introduced the idea of incentive compatibility. His point is the way to get as close to the most efficient economic outcomes is to design mechanism in which everyone does best for himself or herself. He says this can be achieved by sharing information truthfully (Price Transparency). It is easy to understand that some people can do better than others by not sharing information or lying.
The lack of interest in price transparency by the healthcare insurance industry was demonstrated in New York State in the last few weeks.
Benjamin M. Lawsky, the state superintendent of financial services, whose new agency oversees the state insurance division said,
“How these companies are setting these rates is vital for the public to know, and should not be treated like a state secret,” “Transparency will promote healthy competition and enable the public to rigorously comment on proposed rates, two goals that all of us should favor.”
The state insurance division issues permits to healthcare insurance companies to sell insurance in the state. If a healthcare insurance company does not want the state to publish the reasons for its insurance premium increases they should not be issued a permit to sell healthcare insurance in that state.
Mr. Lawsky has ordered that the memos be made public. His decision will go into effect by the end of November unless the companies obtain a court injunction.
The healthcare insurance industry has held the advantage over consumers in the past under the long-standing “trade secret” exemption. The state legislature should have the courage to eliminate that exemption.
State Insurance Department has received hundreds of consumer protests over proposed premium increases, many of them double-digit percentages without justification except that it must be done. The State Insurance Department now has the power to reject proposed rate increases. The question remains as to whether they have the courage to reject the increases.
United Health/Oxford wrote, “This matter is of critical importance to us.” It called the information “proprietary.”
Aetna wrote, “Public disclosure in this format will provide ready and easy access to comprehensive pricing, product and marketing strategies,” and warned of “substantial and irreparable injury to Aetna.”
Independent Health said, “It had spent “well over $700,000 developing the trade secret documents” and estimated that the value of keeping them confidential was much higher.
It sounds as if both Aetna and Independent Health are threating the state with legal action. If they do not like the state rule they should move on and not sell insurance in that state.
The state’s obligation is to protect its consumers from abuse. The state should simply deny permits to the healthcare insurance company to sell healthcare insurance in the state.
Moreover, other companies argued, the filings are too technical to be understood by consumers.
“Several of the exhibits to the rate application as well as the actuarial memorandum contain not only trade secrets as noted above, but esoteric actuarial pricing precepts best understood by fellow actuaries and health plan competitors,” Sean M. Doolan, a lawyer representing Excellus, Empire, Connecticut General, and Capital District Physicians’ Health Plan wrote to state officials.
“These documents, often speaking of concepts such as morbidity and anti-selection, could cause not only confusion, but also unnecessary alarm to the layman policyholder.”
These are excuses. They are lame and patronizing. Consumers are not as dumb as the insurance industry thinks.
Elisabeth Benjamin is vice president for health initiatives at the Community Service Society of New York and a founder of Health Care for All New York, a coalition of 100 groups working for more affordable medical care. She said the group has hired its own actuaries.
“The only way the public will find out whether these outlandish price hikes are justified is if we can see the underpinnings,” she said. “They would like to have us ignorant. What they are saying to us, by opposing the disclosure of why they think their rate increases are justified, is that they want to keep us uninformed consumers.”
They sure do want to keep consumers ignorant. I hope the state officials are not intimidated by the healthcare insurance companies. I hope the state officials are supported by New York’s governor. Consumers are starting to understand their power. They need to drive the healthcare system. This issue is a good place to start.
Everyone except Mitt Romney agrees RomneyCare was used as a model for President Obama’s healthcare reform act. Mitt Romney insists that on the first day of his Presidency he will repeal Obamacare. He contends that healthcare reform should be a state problem. Each state should choose what is right for itself.
RomneyCare was enacted in 2006. It was implemented it in 2007. It offered insurance subsidies for low-income individuals, expanded Medicaid coverage and created an individual mandate to obtain insurance. Pay-or-play requirements for employers were imposed on employers. It created a state insurance exchange through which many of the newly insured Massachusetts residents obtained coverage.
It sounds like Obamacare.
In Massachusetts 98% of its citizens have healthcare insurance coverage. Massachusetts has also experienced a large increase in health insurance premiums. The healthcare insurance costs have nearly doubled in Massachusetts. There is increasing political pressure and public opinion opposing the increasing budget deficit resulting from RomneyCare.
My impression in 2007 was that Massachusetts would experience an increase in healthcare costs, an increase in budget deficits and a decrease in availability of medical care.
I also knew there would be an increase in administrative costs and administrative jobs. Anytime a new bureaucracy is begun there is an increase in hiring bureaucrats. Many times bureaucrats’ income is higher than physician’s income.
The study showed there was an increase in job growth in the healthcare sector. The increase in hiring was 5.5% greater than job growth in the rest of the United States’ healthcare sector.
From 2005–2006 to 2008–2009, employment per capita in administrative occupations grew by 18.4% in Massachusetts, as compared with 8.0% in the rest of the country (P=0.015).
This data clearly confirms my bias. The data shows a pattern that should be obvious to all.
Unfortunately, none of the differences in percentage in each category are statistically significant. In order for a comparison to be statistically significant the p value must be less than .05. A p value of 0.015 is greater than .05. It is not statistically significant.
Two weeks ago I had an email exchange with a reader about the importance of accurate data. Data is scientific and complicated. It increases the complexity of the healthcare system.
The reader wrote,
“With the advent of HIT products such as EHR’s, registries and “smart” hardware, it is now much easier to access data that can be used to drive improved outcomes. Most EHR’s can provide population level data that can be used to view the level of care presently rendered and to track changes in outcomes as new processes and hardware are adopted.
It will be necessary in the near future for providers to develop their skills in using data to modify processes at their site so that the patient outcomes are significantly better. New payment models based upon quality of care will require this. Successful employment of these techniques will be rewarding for all involved—patients, providers and payers.
Have a great weekend.”
I replied,
“If data is not accurate and the results are not statistically significant, the conclusions, decisions and policy on the basis of the data are not going to be good.
I have seen business data and healthcare policy data that has been poor, inaccurate and not statistically significant pose as accurate scientific data. This data has led to faulty business and health care policy decisions. “
Physicians have been paranoid about the collection of data evaluating their performance. Both valid and invalid data have been used to penalize them. Data collections should be used as a learning experience not as a punitive weapon to reduce reimbursement.”
Toyota has done it in its factory auto production. My reader continues
“This approach to providing quality in services and products has been used for many years outside of healthcare. Toyota developed a unique approach based principally on plan-do-check-act (PDCA) and teamwork that resulted in a superior product that enabled them to be the standard of quality in production for many years.”
It is time the physicians adopt this model. Unfortunately it will not happen until the competing learning systems (experiential, [physicians learning] and complicated [data collection]) are managed effectively and stakeholders’ incentives are aligned.
It is time the healthcare system started to use accurate data. Accurate data can extend the legacy experience of physicians. Only then will the healthcare system start aligning incentives.
Some healthcare providers are starting to adopt data driven models such as PDCA. I believe adoption can only be driven by trust among stakeholders. Patients are first and they must assume responsibility to drive the system.
The only way they will do that is if they have a financial incentive to drive the system.
I will try to describe a framework necessary for consumers of healthcare to drive the healthcare system. Successful employment of these techniques will be rewarding for all involved—patients, providers and payers.
If people really want quality insurance, it is available and affordable. They just need to make it a priority in their budget and call health insurance reps to find them the best deals that fit them.
Starting in 2011, Part D enrollees whose incomes exceed $85,000 (for individual tax returns) or $170,000 (for joint tax returns) will begin paying more for Medicare Part D (Drug Prescription Benefit Plan). These “super rich?” seniors will be paying up to 60% more for Medicare Part D per person.
Some really rich seniors who receive a total income from all sources, including retirement benefit, social security, capital gains and dividend will pay the government up to an additional 500% more than their Medicare part D premium costs.
President Obama has chosen to tax seniors for the outrageously constructed drug benefit rather than putting seniors first.
President Obama slipped the means testing regulation for Part D into last years budget. Means testing went into effect on January 1,2011. I missed the regulation and its implementation completely.
Congress and the mainstream media also missed this rather historic regulation. Some would say the regulation was in plain sight but congress did not bothered to see it.
It was also astonishing to slip this into law when President Obama specifically promised he would not change Medicare benefits for any seniors.
President Obama cannot be trusted.
It reminds me of President Reagan’s famous line. “I am from the government and I am here to help you.”
President Obama’s plans to collect more than $8 billion a year from “wealthy seniors” for Medicare Part D drug prescription benefit by “means testing” seniors for all sources of income.
Major Democratic members of the House and Senate have been opposed to means testing for Medicare Part D. President Bush tried to get congress to pass means testing for Part D in 2006. It was quickly rejected by the Democratic controlled congress.
“Social Security and Medicare are participatory programs, designed for all Americans—rich and poor alike. You work hard, kick a portion of your income into these two retirement funds, and are guaranteed a payout in your golden years. This gives these programs broad popular support—they are not welfare for the poor, they are guaranteed retirement benefits for all.”
“Liberals fumed. Means-testing of entitlement programs would send us down a dreaded "slippery slope," they argued. Soon Medicare, and then Social Security, would lose their broad-based popular support, and be merely costly welfare programs! Both Obama and then-Sen. Hillary Clinton voted against a Republican proposal to means-test Part D last year.”
President Obama’s regulation has not gotten very much media attention. Liberals declare the goal is to preserve Medicare's status. Wealthy seniors (earning retirement income from all sources of over $85,000 per year) did not recognize the increase in 2011. The tax is deducted from their electronically paid Social Security benefit.
“Requiring some seniors to pay more for Medicare is a red herring from Republicans who want nothing more than to end Medicare as we know it,” said Rep. Pete Stark, ranking Democrat on the Ways and Means Health Subcommittee. “Upper-income seniors paid more into Medicare when they worked. Applying a new surcharge is essentially double taxation and should be rejected.”
Charlie Rangel’s reaction to means testing for Part D was expressed in 2006.
“The beauty of Medicare is that we’re all in it together, whether you are rich or poor, healthy or sick,” commented Rep. Charles B. Rangel, senior Democrat on the Committee on Ways and Means. “Charging certain people more is the first step toward destroying Medicare’s universality and turning it into a welfare program.”
“It is simply unacceptable that nearly 2 million Medicare premiums will double beginning this January,” House Democratic Leader Nancy Pelosi said. “Seniors, who are already struggling to make ends meet, should not pay the price for failed Republican policies. With further premium increases slated in the future for even more beneficiaries, we must act immediately to protect America’s seniors.”
These additional charges are sure to catch some seniors’ off-guard. Some who might be subject to the additional charges are those who own a business, those who are earning farm or investment income, seniors who are taking installments from their 401(k), or those selling a home for a profit.
What bothers me most is that there was no public discussion or political debate on the issue that I recall. President Obama simply hid the increased senior tax in his budget. He has often promised to make the drug plan more affordable.
President Obama’s means testing regulation is really an assault on the retired middle class seniors of modest retirement income.
I have received comments like, What does this have to do with the healthcare system? Who cares about Mechanism Design? What does the healthcare system have to do with Pareto efficiency?
One person wrote; “Dr. Feld, I do not get it. None of this relates to the healthcare system.”
It dawned on me that his transformation model could be applied to the healthcare system. Everyone knows the healthcare system has to be fixed but no one knows what to do.
President Obama and Dr. Don Berwick are making the dysfunction worse as they impose their complicated ideas on the healthcare system.
A reader wrote in response to my Home Depot article,
“Yeah, this is good stuff–consumer oriented. Obama & those ox#70 professors he listens to don't get this at all.”
I often get comments that the Healthcare System is impossible to repair. It is too complex.
Medicine is going through a transformation. There is conflict between vested interests and between learning systems.
1. Stakeholders are fighting to protect their vested interests. The fight has intensified as a result of the transformation. The conflicts must be resolved.
2. Physicians continually learn through the experience of daily medical practice. The experience gained increases physicians’ medical judgment. This learning system is important for the physician-patient relationship. It promotes the confidence patients should have in their physicians.
As a result of the dysfunction in the system physicians are abandoning their medical judgment in the pursuit of defensive medicine and patients are losing confidence in their physician’s judgment.
Data should be accurate and informative for patients and physicians to improve care. Instead the data collected has been punitive to both patients and physicians.
3. Advances in medical science and medical technology represent complicated learning systems. New advanced techniques are developed in surgery, medicine, genetics and therapeutics.
Information technology offers a chance to enhance experiential learning but has not been deployed properly. Instead it has led to disinformation and increased stakeholder mistrust.
Healthcare insurance companies, hospital systems, and the government have installed complicated data collecting information systems to gather insight into the cost and quality of medical care.
In the past, much of the data has not reflected the true value of the care of physicians. The data has been used to the disadvantage of patients and physicians.
4. No one has understood the patterns of behavior that have resulted from these conflicting learning systems and vested interests. No one has figured out how to manage the complexity generated by these interactions in the healthcare system.
The Home Depot example of learning to manage complexity can be applied to the healthcare system.
The physician is the store manager. The patient is the customer. All the rest of the stakeholders should be the supporting cast.
Once everyone gets it, a sensible conversation can begin. Only then can the healthcare system be on its way to achieving Pareto efficiency.
Readers should think about their recent healthcare system encounters. I would guess many have walked away with an unpleasant feeling toward the healthcare system whether it was the encounter with the insurance company, hospital, government, pharmacy, or physician.
Navigating the healthcare system has become an unpleasant chore.
It is also unpleasant for all the stakeholders. Yet none of the stakeholders see their Blind Spot.
These unpleasant and inefficient activities are created by the complexity of the healthcare system. This complexity can be broken down into components parts. Only then can the complexity of the healthcare system be managed.
The most important asset all of us own is our health. Every effective effort must be made by the healthcare system to maintain our health. We as individuals must be responsible for maintaining our health. Individual responsibility can be achieved. When it is everyone will win.
Central control of our healthcare system with government imposition of rules and regulations to control patients’ freedom and physicians’ medical judgments will not work.
Last week I had a great experience at Home Depot. Bernie Marcus and Arthur Blank founded Home Depot in 1978. When Home Depot started customer service was king. The customer came first.
"Bernie and I founded [The Home Depot] with a special vision — to create a company that would keep alive the values that were important to us. Values like respect among all people, excellent customer service and giving back to communities and society."[9]
In the early 2000’s after Marcus and Blank retired, customer service was no longer king. Home Depot had lots of inventory but there was no one around to help customers find what they wanted .
Lowes surpassed Home Depot in customer service. Lowes grew at a faster rate than Home Depot.
Over the last few years I notice that Home Depot was trying to get its act together. However, I had become a Lowes fan. I went to Home Depot occasionally just to give it another chance.
Last week I needed some lumber to fix our deck. In the past, it had been a traumatic experience to find the right sizes of lumber at Home Depot by myself. I would wander around the lumber section for at least an hour before I found the best pieces of lumber. Home Depot had a lot of some things but was out of others.
Last week, Jeremy Felts greeted me in the Home Depot Lumber Department at our local store. He asked me what I needed. He then proceeded to gather the best lumber in the correct size. He even asked me if I wanted him to custom cut the lumber.
I had picked up some wood screws on the way to the lumber department. He looked at my screws and told me he would get me better screws for my project at a lower cost.
He helped me to the checkout counter and got me a guy to help me load the car.
I could not believe it! This had not happened at Home Depot in at least 14 years.
Every Do It Yourselfer forgets something or runs out of something during a project. On Sunday morning I was back in Home Depot to get more caulking and various size washers. This time Lyle Bruckman greeted me.
He took me directly to the washers and pulled out the three sizes I needed among the 50 choices. This little exercise would have taken me 20 minutes. He then walked me to the caulk.
I was in and out of the store in five minutes.
A few years ago this same experience in Home Depot was traumatic. What happened at Home Depot to actually service the consumer once again?
When Home Depot hired Robert Nardelli in 2000, he hired the Feld Group (my brother’s company) to help figure out their information technology problems. Home Depot needed information technology to solve its inventory problems.
It turned out that each store managed its inventory with their own computer system. The store manager also managed his employee and was responsible for customer service.
From each store’s own experience the store managers and employees figured out their local customers’ needs.
This is an example of an experiential learning system.
Complicated (i.e. scientific, electronic, information technology)
Complex (The interaction between 1 and 2, pattern recognition)
Wal-Mart negotiates the lowest prices using a system of central procurement. Wal-Mart managed its complicated inventory system by distributing products locally according to the needs of the individual stores. Store managers ordered products from the central procurement office rather than individual vendors.
Using sophisticated information technology everyone’s incentives were aligned. Wal-Mart central negotiated the best price for all the stores. Local stores ordered their own inventory from Wal-Mart central. Employees maintained their enthusiasm because they felt a sense of control of their own store.
Wal-Mart managed complexity by using a hybrid of central complicated technology and local experiential knowledge.
No snow blower’s were sent to Texas. Wal-Mart was able to get “The Best For Less” to the right stores.
Wal-Mart also learned that by some magic that this hybrid use of complicated learning systems and local experience produced incentives that created efficiency in each store.
At the time Robert Nardelli became CEO of Home Depot procurement was decentralized. Different stores were paying different prices for products. Profit margins were variable.
Robert Nardelli wanted centralized procurement. He invested heavily in information systems that negotiated prices centrally. He rejected the notion of permitting local stores to have control over their store needs.
The result was chaos. Store managers became dispirited. Employees became dispirited. It was not their store anymore. Home Depot Atlanta controlled everything.
Customer service plummeted, customers left Home Depot for Lowes and the stock price fell.
Since Robert Nardelli left Home Depot the focus has been on the customer service expressed by Bernie Marcus and Arthur Blank in Home Depots original mission.
Home Depot has combined negotiating prices centrally with the experience of local store managers. Home Depot is managing complexity to the extreme satisfaction of the customers.
The result is seen in the enthusiasm of Jeremy Felts and Lyle Bruckman. Last Tuesday night I was back in Home Depot for more stuff. I bumped into Jeremy Felts. He told me his store manager Brian Worley read my letter of commendation to visiting district and regional managers with him being present.
He said he was embarrassed but thrilled. He also said “ You know Dr. Feld I love my job.”
Can the same management of complexity be accomplished for the healthcare system? I know it can be done.
It cannot be accomplished with the orientation of President Obama’s Healthcare Reform Act (Obamacare).
I really liked this concept — it is an exceptional medium to help someone in their critical time of need. Paramedics refer to it as the golden hour though they may not even have an hour in some cases.
Thinking through, I found few glitches in its practicality; for instance, the value of ICE reference is lost if your phone is destroyed by the impact, like an accident, that caused the emergency. Read more in my blog post at: http://icecare.info/blog/2009/09/01/ice-debunked/
I still liked the idea and felt we could improvise with a little extra effort for prevalent life style; and have created a solution called ICEcare.
I am open to feedback and cooperative efforts.