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All items for March, 2013


Obamacare’s Deception

 Stanley Feld M.D.,FACP,MACE

all remember Nancy Pelosi’s famous declaration when she said “we will not know
what is in the bill until we pass it.”

could remember asking to myself how stupid can Americans be to listen to this

are going to be shocked to learn the extent to which they have been deceived by
Obamacare. The legislation neither protects patients nor makes  the Health Insurance Exchange plans affordable.

details of Obamacare have been anything but transparent. New details are
appearing every day in the form of new regulations by new agencies.

believe it would be impossible for someone without an intense interest in
Obamacare to understand it.

have been over 20,000 new regulations from 300 new agencies so far. Mass
confusion has been generated as regulations from one agency contradict  regulations from other agencies.

Obama administrated has said recently that the public should not expect cost
saving from Obamacare.

 The Obama administration has also asked for an
additional $1 trillion dollars over the next ten years in order to fulfill
Obamacare’s promise to the American people.

looks as if none of the administration’s advisors or the administration had
considered the unintended consequences.

works for the insurance companies but not for Americans.

slogans such as “shared responsibility,” “no free riders” and “ownership
society.” dress the insurance industry’s raid on public resources in the cloak
of a “free market” health care system

Obamacare neither protects patients nor are the healthcare
insurance plans to be offered by the health insurance exchanges affordable.

Americans with incomes between 133% and 400% of the Federal
Poverty Level (Income above 133% of the federal poverty level = $31,322/yr. or $2,610/mo.
Income above 400% of the federal poverty level= $94,200/yr. or $7850/mo.) will
pay for the least expensive   subsidized policies from 2% to 9.5% of Modified
Adjusted Gross Income (MAGI) from their IRS reported income.

Americans with the least income are faced with a substantial yearly
and monthly after tax salary reductions even though their healthcare insurance
policy is subsidized by the government.

On January 1,2014 they are mandated to have healthcare coverage.

A person with a Modified Adjusted Gross Income receiving $27,925
from all sources of revenue will pay $187.33 per family member per month.

The total price for a family of four is ($2,247.96 per year times
4)  $8991.84 in after tax dollars. This
pays for a Silver level plan that is next to the least expensive plan to be
offered by the health insurance exchanges.

If a person who has this plan goes to a physician or a hospital  the patient’s deductible will be sizable
despite the government subsidy.

Even if the family has subsidized healthcare insurance these
families might not be able to afford to use the insurance.

The quality of life of a low earner will be compromised. He must
buy the subsided healthcare insurance. The result will be he will have to make
cuts in buying food and adequate housing in order to pay for the healthcare

We have not heard much about this problem from the Obama

As the insurance industry raises premiums on private insurance
they are also going to raise the prices in the Health Insurance Exchanges.

If the family opts out of buying the insurance they will have to
pay a penalty.

It is actually better to pay the penalty and then sign up for
insurance if you or a member of your family gets sick.

 The fee paid for
insurance in 2014 will varying according to 2012 income. If a family income
rose in 2012 and the breadwinners lost their jobs in 2013 and 2014 the family
could not afford the MAGI healthcare insurance premium they would be required
to pay.

If income increased in 2013 they would be liable for the
increase the next year.

stress alone from such a regressive scheme is, without a doubt, not conducive
to good health and well-being.”

On January 1, 2014 everyone is required to buy healthcare
insurance or
else pay a penalty. Even with the government’s subsidy a low income
earner could be forced out of the market.

In the meantime, states such as California are decreasing
reimbursement for physicians. Physicians are choosing not to participate in
both Medicare and Medicaid. This will increase the physician shortage.

The only choice states have left is to tie medical license
renewal to physicians accepting Medicare and Medicaid.

At the same time states and the federal government are
decreasing funding to already financially stressed charity safety net hospital
systems. Many of these institutions have closed. Most of them are failing.

The decrease in safety net hospital systems will further
decrease the options for low-income earners to receive medical care.

Obamacare is turning out to be a not well thought out plan. It
is a series of Catch 22s.

The only winner is the healthcare insurance industry which will
provide the administrative services to the government to adjudicate claims. It
will receive both the government subsidy and the payment made by the low-income

Obamacare has deceived the public.  As I have stated in the past Obamacare has
some good ideas but the structure, regulations and execution are terrible.

Obamacare sounds good when President Obama talks about it but it
is an impending disaster medically and financially for Americans.

Only a consumer driven healthcare system with the bullet-proof
ideal medical savings account will align all the stakeholders’ incentives.

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

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St. Patrick’s Day 2013

Stanley Feld M.D.,FACP,MACE

St. Patrick’s Day is my birthday. This St. Patricks’s day was my 75th

A little background has to be presented before I talk about the
phenomenal birthday party my wife Cecelia threw for me in the Eilan Hotel Resort and
Spa in San Antonio.

When I was three years old my mother took me to the New York City Fifth
Avenue St. Patrick’s Day Parade. She sewed a kelly green jump suit for me to

When we got to the Parade she told me all those people were marching to
celebrate my birthday. This happened every year until I was six. I finally
caught on.

She celebrated St. Patrick’s Day with me  the rest of her life. After I
moved out of the house she would call at 6.30 am every St. Patrick’s Day and
sing Happy Birthday to me.

My sister-in-law took over after my mother’s death. I get a chill up my
spine every time Cindy does it. She never misses a beat.

Cecelia sent me this as a little extra birthday present.


I helped fund Doug and Telisha's new CD with a donation through

Here it
is, FOR YOU, their personal video. HAPPY BIRTHDAY! "

"Hi Cecelia,

Here is a link to Stanley's special video telegram:



I started my practice of Clinical Endocrinology in the summer of 1970.
At the beginning of March 1971 I bought a kelly green wool blazer to wear while
seeing patients on my birthday. If March 17th landed on a Sunday I
carried out the ritual on Monday. If it landed on Saturday I wore my jacket on

It was lots of fun. After a few years the same patients made an appointment
to see me on my birthday.

After a while more people than I could see in one day wanted an
appointment on that day. Some of the people made appointment a year in advance
so they would have the slot.

I think they had more fun than I had. Patients started bringing me St.
Patrick’s Day clothing. They brought in green ties, sweaters, vests, leprechaun
shoes and hats of all shapes and sizes.

I had so much stuff and so many patients that wanted to have an
appointment on my birthday that I extended the celebration to two days and
started wearing a different costume each day.

My birthday has been a glorious day. This year Cecelia wrote to her
entire email list and asked them to say something about me. She has not given the album to me yet because she has not finished it and the notes keep coming in.

She said many of the notes made her cry and she
is sure they will make me cry.

Brad put his note to me in his blog. It made me cry. I remember all
of it.

Cecelia and I drove down to San Antonio on Wednesday March 13th. We thought it would be fun to drive. It was a mistake. I-35 is still a mess between Waco and San Antonio after all these years.

I would be remiss if I did not put some of my outfits into this blog.

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Arriving at Eilan Hotel Resort and Spa

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 I wore this soccer shirt to dinner at La Fonda with Brad and Amy.

 Thursday Daniel, Laura and Sabrina arrived. We explored the new end of the Riverwalk before dinner. 

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Doesn't Daniel look great? 


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Dinner was wonderful at Il Sogno Tratoria at the Pearl Brewery 


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Friday's Outfit

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 Charlie and Cindy arrive.


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Dinner at Boudros on the Riverwalk

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All dessed up for Saturday  


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They dyed the San Antonio River green for my birthday.

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They did it in Chicago,too. My birthday is a great day.

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My fabulous and beautiful wife and I before dinner at Sustenio at the Eilan Hotel

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Brad, Amy and I before the birthday dinner.

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My cake. Do not let the green fool you. It is solid chocolate

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Brad, Stan and Dan with the most wonderful person in my world, Cecelia.


I wish to thank Cecelia publicly for creating this fabulous weekend. 

I love you



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

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I Can Hear The Train A Comin’

Stanley Feld M.D.,FACP MACE

It is almost past the time for physicians to
listen to that train whistle coming down the line.

A reader wrote


blog Dr. Feld.

your Physician friends this question:

and how will you feel when your license to practice medicine is no longer
sanctioned at the state level, rather it is issued by the Federal Government
and tied directly to your willingness to see a certain percentage of
Medicare/Medicaid patients?”

where this train is headed, most physicians are simply too blind it to see it or too deaf the hear it.

M "


M., I have tried to warn my physician
friends that the train is coming. Physicians’ freedoms and the patient-physician
relationship are circling the drain.

The only option they will have will be
to practice medicine without a license. This is a ridiculous thought.

Where is the silent physician majority?
I have only heard from Dr. Ben Carson. I have a feeling the press is going to
start calling him a lunatic very shortly. The goal will be to marginalize and silence


Where are the organizations that are
supposed to represent physicians and their patients?

If you ignore the pain you do not know
the cancer is growing. If you do not feel the pain you do not know if it is
growing either.

The cancer cannot be cured if it is

Physicians cannot ignore this problem
any longer. Neither can consumers. Entitlement spending run wild will drive
America into bankruptcy.

Cancer is comparable to the national debt.
It will not be cured if it is recklessly ignored. The end result will be

President Obama has
demonstrated an apparent disregard for the literal interpretation of the constitution’s
First, Second, Fourth and Twelfth Amendments during his term in office.

States rights seem
meaningless. The Democratic congress has empowered President Obama to do anything
he wants to do to the healthcare system.

Congress has transferred all
decision making to the executive branch of government.

Congress is supposed to
represent the people. Most consumers do not know what is going on. The
information is not readily available.  If
they do not know what is going on will not mount a protest.

Consumers who enjoy the
benefits of the entitlements are not likely to be willing to give them up. It
is not as much a matter of entitlements as it is a matter of waste and
inefficiency resulting from complex government bureaucracies.

President Obama has told us
that Medicare and Medicaid are very efficient. Yet he has not provided proof.
The administrations claim is the waste is the result of fraud and abuse. My
question is by whom?

Public opinion cannot be
expressed if the public does not understand the issues.

The traditional media has
ignored most of the important issues; it has not published the possible
consequences of the administrations rules, regulations and actions.

If congressmen express an
opinion contrary to the party line of the establishment they are called a Wacko

The press will jump all over
this because it might sell newspapers or magazines. The public accepts the
catchy phrase as the truth.

I have outlined and
described in detail the logical solutions to Repairing The Healthcare System.

With the 20,000 new
regulations and 300 new agencies the Obama administration has tightened the box.
They have disabled the physicians’ ability to practice medicine unless they
comply with government dictates.

This is called government
control and takeover of the healthcare system.

Many physicians think they
can finesse this imprisonment. These physicians are wrong. Many think they will
be able to stop accepting Medicare and Medicaid and continue to practice
medicine. They are wrong.

Physicians’ ability to use their
medical judgment is being taken away.

The Obama administration’s
response would obviously be that is silly. They are not trying to control
medical judgment.

However the government
continues to proceed in commoditizing medical care. 

Physicians are going to
scream when they wake up and realize what is happening to medicine and medical

Some physicians say they are
powerless to do anything. These physicians are wrong.

All they have to do is learn
the details of the real issues. Then they have to explain it to every patient.
Patients are not going to like what is happening.

Physicians can provide their
patients with talking points or an already written letter to send to congress
and President Obama.

Remember this is a
government by the people for the people. We hire these guys. Our vote provides
these politicians with their job. Congress and the President are scared stiff
to have our disapproval.

The government runs like
Franz Kafka’s bureaucracy in his book “the Castle.” No one has authority to
make a decision and no one takes responsibility for the consequences.

Who took responsibility for
the Benghazi disaster? The press ignored it. The facts were not forthcoming and
no one took responsibility.

Americans’ health is too
precious to ignore the impending disaster.

Who is going to take
responsibility for the disaster?


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

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Obamacare’s Actions To Destroy The Healthcare System


The Obama administration is doing
everything it can to destroy the healthcare system. President Obama continues
to campaign that he is going to save Medicare and Medicaid and provide
universal care while saving $4.25 trillion dollars.

It does not add up.  The Obama administration keeps raising taxes,
decreasing benefits and increasing deductibles on Medicare and Medicaid
premiums. The administration is decreasing the work force by regulation and
executive order.

Everything that is being done increases
the burden on seniors and insured workers.

To my amazement no one in organized
medicine except the American Association of Physicians and Surgeons (AAPS) has

I applaud Jane Orient M.D. executive
director of AAPS and her Board of Directors for stepping forward and trying to
defend the rights of patients and their physicians.

At stake are patients’ ability to
choose their physicians and physicians’ ability to practice medicine as they

Where are the AMA and all the specialty
organizations in the federation medical organizations?  It is little wonder these organizations are
losing members.

All medical organizations should join
with Jane Orient M.D. and her Board of Directors lawsuit against the government.

AAPS filed suit
against PPACA
 three days after it was signed into law, but the National
Federation of Independent Business (NFIB) and 26 states stayed the case pending
a Supreme Court decision in the case brought.

All of us know that the Supreme Court
upheld the Obamacare law. It was deemed by Chief Justice Robert that the
executive branch has the power to levy a tax. It is not within the power of the
executive branch to create a mandate. President Obama insisted throughout the
legal process that this was a mandate and not a tax.


In my opinion this decision by Justice
Roberts was a big mistake. Obamacare is a terrible law that will not create
universal healthcare. It will be ineffective and inefficient. It will destroy
the healthcare system. Obamacare cannot possible work.

I think this is President Obama’s goal.

The Supreme Court in its decision acknowledged,
"any tax must still comply with other requirements in the

No one except the AAPS has challenge
this point.

“The motion filed by AAPS is the first to ask an appellate
court to rule on whether PPACA
violated the Origination Clause of the U.S.
Constitution, which requires that all "bills for raising revenue"
originate in the House of Representatives.”

More and more physicians are not participating
in Medicare. Physicians still have the ability to choose to participate in
Medicare and Medicaid.

At the beginning of 2013 a new
regulation went into effect. Previously, if a physician did not participate in
Medicare the patient had to pay the physician his fee. The patient could then
bill Medicare and collect 70% of Medicare’s allowable fee.  Medicare does not pay the patient after
January 1st,2013.

Non-participating physicians may use
laboratory, x-ray departments or consultants that participate in Medicare. The
participating consultants, labs and x-ray departments can bill Medicare
directly and receive their usual and customary fee from Medicare. 

Effective May 1, 2013 (a new regulation
issued March 1, 2013 by HHS
) the Department of Health and Human Services will
deprive patients of benefits for blood tests, x-rays, and specialist
consultations—benefits for which they were forced to pay all their working
lives, and which would be covered if ordered or referred by a non participating
Medicare physician.

I believe the Obama administration’s
goal is to force physicians to participate in Medicare.

"Because of Medicare's increasingly costly and
restrictive rules placed on doctors
, many Medicare-eligible patients are
receiving medical care from physicians not enrolled in the program,"
states Jane M. Orient, M.D., executive director of the Association of American
Physicians and Surgeons (AAPS).

AAPS filed an
emergency motion for injunctive relief
  in the U.S. Court of
Appeals for the District of Columbia Circuit.

Founding Fathers fought for independence largely because of excessive taxation
without representation. When the Constitution was drafted, the founders
insisted that taxes originate in the House, the legislative body closest to the
people, both in representation and in election cycles.

originated in Senator Reid's 2000-page
amendment to a 6-page House bill about
tax credits for members of the armed forces who are called into overseas
assignments. AAPS has raised several arguments why ObamaCare constitutes an
illegal tax, including violation
of the constitutions Origination Clause.”

This new executive order disregards the
constitution’s “Origination Clause” to try to stop physicians from not
participating in Medicare

the AAPS had the guts to speech out against this executive branch breech of its
power and defend patients and physicians rights as granted by the constitution.

for the AAPS.

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

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The False Promise of Electronic Medical Records (EMR)

Stanley Feld M.D. FACP,MACE

promise of the Electronic Medical Record (EMR) is fading for physicians and
patients. The EMR was supposed to reduce the cost of medical care, improve
quality of care, improve physician communications, reduce duplicate testing and
improve efficiency of care.

2009 President Obama declared that EMRs,

save some $80 billion a year,
safeguard against medical errors, reduce
malpractice lawsuits, and greatly facilitate both preventive care and ongoing
therapy of the chronically ill.”

EMR’s have
done none of the above. EMRs have been a money-loser for most physicians.

had predicted that fully functioning EMRs were too expensive for most
practicing physicians.
EMRs bought in the past were not fully functional.
Therefore physicians would have to purchase new fully functional EMRs.

understand that all data collected, whether accurate or not, has been used
against them in the past.
They are hesitant to provide more data at their own
expense that compromise the privacy of their patients and potentially harm their
own reputation.

would be happy to participate in the project if the EMR improved their ability
to serve their patients without a potential penalty.

suspect there is another agenda underlying President Obama’s insistence on the
adoption of EMRs.

is clear the government and healthcare insurance industry want to control the
healthcare system.
As the payers they do not want the physician/patient
relationship to control the healthcare system.  

recent survey from
forty-nine community practices in a large EHR pilot study
by the Massachusetts
eHealth Collaborative studied the projected five-year financial returns on
investment to physicians’ practices. It was published in Health Affairs.

survey concluded,

We found that the average
physician would lose $43,743
over five years; just 27 percent of practices
would have achieved a positive return on investment; and only an additional
14 percent of practices would have come out ahead had they received the
$44,000 federal meaningful-use incentive

Only a few practices would
have had EMR’s that qualified for the Obama administrations meaningful –use
incentives. The Obama administration’s criteria for meaningful-use are too
strict and complex for EMR software that physicians can afford.

More amazing is that the
only way for a practice to have a positive cash return on investment for their
EMR is to game the healthcare system using their EMR. The resulting cost of
medical care would rise.

 “The largest difference between practices with
a positive return on investment and those with a negative return was the extent
to which they used their EHRs to increase revenue, primarily by seeing more
patients per day or by improved billing that resulted in fewer rejected claims
and more accurate coding.”

This does not constitute an improvement in medical care. It also
contradicts the idealistic advantages of the electronic medical record.

The survey concludes that current meaningful-use incentives
alone may not ensure a positive return on investment from EMR adoption.

The authors suggest,

that provide additional support, such as expanding the regional extension
center program, could help ensure that practices make the changes required to
realize a positive return on investment from EHRs.”

 The government and
healthcare insurance industry’s goal is to reduce physicians’ reimbursement for
those physicians that do not meet Obamacare’s imposed criteria for quality
medical care. These criteria will be set by IPAB.

Many physicians in practice object to converting medical care
into a commodity. Medical care is a very personal and complex interaction.

I have said previously that about 50% of the therapeutic index
(therapeutic effect) is determined by the patient physician relationship.

 "We need to move to EHR forward for a number of reasons,
but if I am a small practice I am going to really think about a few
things," she says. "One is how to decrease the cost of adoption and
the cost of the system itself.

“ To the
extent you can reduce the upfront cost that is going to help bring down the
amount you have to figure out how to make up elsewhere. Increasingly there are
new models taking this into account for small practices to decrease the big
upfront costs."

There are two basic problems, cost and the real purpose of EMRs.
Both can be remedied.

The costs of an EMR to a medical practice can be remedied
easily.  My ideal electronic medical
record could reside in the cloud. It would be available at no cost to physicians.
The patient data would be fully secured and only used by patients and their

Physicians would pay for its use by the click. The EMRs would be
maintained and updated for free.

The EMRs could only be used for physician education purposes and
not for penalizing physicians.

If there is a terrible physician in the community a way needs to
be found to deal with that physician within his community. This is where
consumer driven evaluation would work.

Lost in this discussion is the real politics of EMRs.

 Jerome Groopman and Pamela Hartzmen

electronic medical record (EMR) is touted as the key to containing costs,
reducing errors, improving quality, and simplifying administration: an “elegant
exercise in wishful thinking

Dr. Groopman and Pamela Hartzman debunk the 2005 RAND study that
led to this belief by President Obama. They show that there is little evidence
to support the president’s belief.

Dr. Groopman claims the RAND study is self serving to software
companies that sponsored the study.

Healthcare Solutions
 ,  the Cerner Corporation  and Epic Systems of Verona, Wis. are the major EMR software companies.

In February 2009, after years of behind-the-scenes lobbying by
Allscripts and others,
legislation to promote the use of electronic records was
signed into law as part of President Obama’s economic stimulus bill.

“But today, as doctors and hospitals struggle to make new records
systems work, the clear winners are big companies like Allscripts that lobbied
for that legislation and pushed aside smaller competitors.”

At Allscripts healthcare solutions,
annual sales have more than doubled from $548 million in 2009 to an estimated
$1.44 billion last year, partly reflecting daring acquisitions made on the bet
that the legislation would be a boon for the industry.

At the Cerner Corporation of Kansas City, Mo., sales rose 60 percent during that
period. With money pouring in, top executives are enjoying Wall Street-style

Current and former industry executives say that
big digital records companies like Cerner, Allscripts and Epic Systems of
Verona, Wis., have reaped enormous rewards
because of the legislation they
pushed for

The weird thing is many of
these EMR systems bought by large hospital systems are not fully functional
(meaningful-use). The EMRs are requiring additional hospital system outlays of
cash to make them fully functional.

These costs are passed on to
the consumer.

The president
and his health-care team have yet to address these difficult and pressing
issues. Our culture adores technology,
so it is not surprising that the
electronic medical record has been touted as the first important step in curing
the ills of our health-care system. But it is an overly simplistic and
unsubstantiated part of the solution.

It is important to note Drs. Groopman and Hartzman total and
refreshing frankness.

We both voted for President Obama, in part because of his
pragmatic approach to problems, belief in empirical data, and openness to
changing his mind when those data contradict his initial approach to a problem.
We need the president to apply
scientific rigor to fix our
health-care system rather than rely on elegant exercises in wishful thinking.

Please note that Drs. Groopman and Hartzman said it not

I have said this many times in the past. The same statement
applies to the Obamacare in its entirety.

need the president to apply
rigor to fix our health-care system rather than rely on elegant exercises in
wishful thinking.”

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

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Facts and Misuse Of Facts


Stanley Feld M.D.,FACP,MACE

All of us try to understand
the facts and make logical decisions by synthesizing the facts.

There is a lot of
misinformation and disinformation being printed. This misinformation and
disinformation leads to the wrong conclusions because the facts are inaccurate.

 A master purveyor of this misinformation and
disinformation is Paul Krugman.

I believe his misuse of
facts is icreasing as he is subconsciously realizing his ideology is incorrect.

Here are a few examples of
disinformation or misinformation in Paul Krugman’s most recent article “Mooching
off of Medicaid”

“For there
is a lot of price-gouging in health care — a fact long known to health care
economists but documented especially graphically in a recent 
in Time magazine
. “

This is true. The margins on hospital systems
retail prices are outrageous. The margins on some discounted hospital system prices
are equally outrageous.

 There is a continuous price war between hospital
systems and payers (government and healthcare insurance companies).

 The uninsured and under insured primary stakeholders
(consumers) are stuck with these outrageous prices.

"As Steven
Brill, the article’s author, points out, individuals seeking health care can
face incredible costs, and even large private insurance companies have limited
ability to control profiteering by providers."

 This statement is not quite true. Most people
have healthcare insurance. The healthcare insurance industry and government
have negotiated discounted prices that are as low as 10% of the retail prices
published in Steven Brill’s article.

In the struggle to retain providers, private
insurance companies offer slightly higher prices than the government.

The healthcare insurance industry knows the
government’s exact reimbursement prices. The private insurance companies
provide the administrative services for the government’s healthcare plans.

Individuals not under the umbrella of these discounted
prices are liable for these high prices. As insurance premiums increase,
employers are reducing insurance coverage for employees.

The deductibles and co-pays are increasing to unaffordable
levels for everyone as an increasing numbers of employees are becoming under insured.

 “For there
is a lot of price-gouging in health care —"

 Price gouging is the result of a lack of
transparency and special deals the government and the healthcare insurance
industry makes with certain hospital systems   

does much better
at preventing price gouging , and although Mr. Brill doesn’t point this out, Medicaid — which has
greater ability to say no — seems to do better still”.

 This is false. There are fewer physicians
seeing Medicaid patients because reimbursement is very low. In fact, in most
cases physician reimbursement is lower than physician overhead. The result is
access to care for a Medicaid patient is restricted. The access to care for
private insured patients is not.

Hospitals receive a bonus for
seeing Medicaid patients. This fact is not transparent and known by few.

despite some feeble claims to the contrary, privatizing Medicaid will end up
requiring more, not less, government spending”,

Paul Krugman makes declarative statements as if
they are unequivocal evidence.

there’s overwhelming evidence that 
Medicaid is much cheaper than private insurance.”

The evidence in Paul Krugman’s quoted study is
not that overwhelming.

I reviewed this 2008 study. The demographic
difference of the Medicaid group compared to the privately insured group is
different. The difference can reveal alternate conclusions.


Jpeg demographics krugman

Note the demographic differences of the Medicaid
vs. Private insurance patients.


Heath status good 
    53.5% vs 41.2%

Mental health             17.4 % vs 

Hispanic                     23.4% vs 16.9%

African American        27.5%
vs 16.4%

White                          49% vs 66%

Employed                   48% vs 74.6%

No hi school degree   36.7% vs 17.2%

Married                        33.6% vs 51.7%

Income less than poverty 62.3% vs 22.2%


An alternate conclusion could be that it is too
difficult for Medicaid patients to find a physician. Medicaid patients are more
poorly educated. The do not seek physicians’ help compared to the privately
insured group. Medicaid patients cannot afford the minimal out of pocket

Jpeg 2 costs


To my amazement the unadjusted annual per person
Medicaid spending was higher in this article for the Medicaid insured group
than the privately insured group by $1000.  

Paul Krugman states Medicare
and Medicaid have lower administrative costs.

this reflects lower administrative costs, because Medicaid neither advertises
nor spends money trying to avoid covering people”.

 He goes on to say.

 “But a lot
of it reflects the government’s bargaining power, its ability to prevent price
gouging by hospitals, drug companies and other parts of the medical-industrial

The government does have
bargaining power. However reimbursement to physicians is so low that it is
difficult for Medicaid patients to find a physician.

This could be a reason
Medicaid costs are lower than privately insured patients with a high school
education and a job.

Acute care hospitals have a
10% Medicaid threshold. They can also be eligible for incentive pay.

 In addition, to be eligible to receive a
Medicaid EHR incentive payment,
acute care hospitals must also meet a 10
percent Medicaid patient volume threshold.”

Krugman and others conclude,

Our nation cannot control runaway medical spending without
fundamentally changing how physicians are paid.”

Physicians receive only 9% of healthcare
dollars spent. The real facts are physicians write orders for the inflated services
of the hospital systems without receiving financial benefit. In fact, the
government restricts physician participation. Physicians’ reimbursement
decreases yearly.

It is very easy to draw the
wrong conclusions when relying on inaccurate facts from so called experts.

The real challenge is to
dig down and get the correct facts.

This is not done because
ideology, non-transparency and bias stand in the way. This contributes to the
healthcare system becoming more dysfunctional and costly each year.

 Healthcare policy errors are made because
policy is made using incorrect facts.

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

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A Point Of View

Stanley Feld M.D.,FACP,MACE

Steven Brill’s 24,000 word
article “Bitter Pill” is an excellent review of some hospital charges. He
presents examples of outrageous hospital charges.

 Many consumers have experienced these charges
but have ignored them. Few have understood them. Their healthcare insurance
coverage negotiated the reduced payment.

His examples of charges
from real patient bills such as $199.50 for a troponin test. Medicare pays
hospitals $13.94 for the test. The hospital accepts the charge. The actual cost
of the test is less than $4.00.

hospital charge for a simple complete blood test was $157.61. Medicare would
pay $11.02.  The actual cost to the
hospital might be fifty cents.

simple finger stick blood sugar hospital charge was $18.00.  Accu-chek gives the machine away to sell the sticks. A box
of 50 test strips costs $27.00 or $.55 a strip. It cost less that one penny to
produce a strip.

that more people are unemployed and fewer people are insured or have adequate
insurance, consumers are starting to pay attention to these fees.

 It is about time that a major news media
outlet published something about these outrageous hospital system charges to

After all, the media is the message!

Maybe the message will
generate the necessary community outrage for effective reform.

I have often heard “when
you are sick enough to need a hospital you do not have the time to shop
around,” for the best price.

It is true. However, no one
has questioned hospitals for charging those rates.

The poor, uninsured and
underinsured are the consumers this price system hurts the most. Society needs
to protect these Americans from this outrage.  

Consumers with adequate
healthcare coverage do not even look at the explanation of benefits for their
healthcare bills.. Their healthcare insurance company pays the bill after
negotiating the price with the hospital system.

As premiums and deductibles
rise these fee are getting more attention.

There is so much data in
Steven Brill’s multi-page document that I am sure comprehension is low. It does
not mater. 

Steven Brill’s message is
crystal clear. The situation is intolerable. The American public is being
ripped off. Healthcare pricing is destroying our nation’s economic growth.

Brill does not explain the
reasons how these high prices evolved. He does not explain whom if anyone
should be doing something about them.

He does not come out and
say the solution is government takeover of the healthcare system. However, he
implies it throughout his article.

Any fair minded individual
would be sympathetic to this implied notion. However. Steven Brill disregards
the fact that the government got us into this mess.

I have explained this over
and over again.

The Berkeley economist James C. Robinson pointed out that improving
the healthcare system is different than making technological improvements in an
outmoded corporation.

The success of all other transformations has been consumer driven.

The healthcare system has evolved to the point that consumers must
shut up, do as they're told, and be prepared to write a blank check.

 Healthcare policy wonks
have concluded that healthcare must be commoditized and depersonalized.

This thinking has resulting in the present healthcare system’s pricing.
No one understands it or is attempting to modify it.  

  • “The corporate system of health
    care has produced stronger organizations and more intense performance
    competition than the traditional system dominated by professionals.
  • This transformation of the health
    care system has swept away the framework of professional dominance in

The excuse has been that consumers do not know how to drive the
healthcare system. It is too complicated.

This excuse has been used to "justify every inefficiency,
idiosyncrasy, in the healthcare system driven by professionalism, by
interest-serving institutions and corporations in the health care industry to
control and raise the price of healthcare."

Hospital systems have realized that in order to control the system
medical care must be commoditized. There is also government agreement.

 “Hospitals, insurers and other institutions
involved in health care battle over available dollars

These institutions also know that
hiding the true cost of healthcare from the consumer is the way to inflate
value and increase cost.”

Hospital systems also know in order to control the healthcare system
completely they need to own physicians’ skills and intellectual property.

Patients and physicians drive the healthcare systems not
corporations and hospital systems.

Physicians like the public are blind to hospital charges and costs.
There is no price transparency. The hospital systems are positioning themselves
as parasites to take advantage of patients and physicians.

The government is trying to encourage hospital employment of
physicians so it has fewer entities to deal with. This is a mistake.

Steven Brill indirectly implies government driving healthcare for
all is the cheapest and best way. He is wrong.  

A government single party payer system will only increase the
price of healthcare and create unhappier patients with restricted access to
medical care.

Physicians are not interested in having their skills and
intellectual property treated as a commodity.

Physicians will become more cynical. They will unionize and restrict
their hours worked in a week.

These developments will cause the ultimate demise of the
healthcare system.

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

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