Stanley Feld M.D.,FACP,MACE

I believe in-store clinics are a bad idea and they will fail. If successful these clinics can potentially put family practitioners out of business. If they are marginal, they will put a reasonable dent in the primary care physician’s ability to make a living. It is presently difficult for family practitioners to make a decent living. The development of in-store clinics is the result of the difficulties patients are having with affordable access to medical care. If patients have to go to the emergency room of a hospital, wait three hours to be seen, and incur a large bill for a simple illness the healthcare system is not being responsive to the patients’ needs. Convenient Care Clinics’ attraction to patients is they help them avoid these barriers to care.

The growth of these in-store clinics is the result of the primary care physicians’ (PCPs’) inability to set up their medical practices to match the needs and schedules of the hectic life of patients in America today. The blame should not only fall on the PCP. The blame should also fall on organized medicine’s inability to recognize and respond to the needs of the PCPs’ and the practicing physicians’ patients. Organized medicine should be developing programs to teach PCPs how to respond to the changing needs of patients’. If medical practices do not respond to the needs of their patients, someone will.

A problem with the in-store clinics is they are run by nurse practitioners or physician assistants. They are not under the direct supervision of physicians. For years, physicians have fought to prevent physician extenders from practicing medicine on their own for the protection of patients. Some in-store clinics will have a physician sign off on the medical care provided. However, the physicians will not have had contact with the patient or examined the patient. Most of the time the in-store clinics can get away with this level of care. This type of care cannot be defined as quality medical care. Hopefully the nurse practitioner or physician assistant will recognize a really sick patient. Hopefully, when they do they will send the patient to the nearest emergency room.

I believe the in-store clinics will have a difficult time achieving positive cash flow unless they raise their prices or do more in-store procedures. The financial experience of hospitals that opened DOC in the Boxes to feed their hospitals was disastrous. I predicted a decade ago that it will only be a matter of time before the hospital DOC in the Boxes would go out of business. Many physicians who started these clinics did well monetarily when they sold their DOC in the Boxes to hospital systems. It might be that the pharmacies (CVS, Target, Walgreens, and Wal-Mart) are hoping to make money when the patients are in the stores. Rite-Aid has already closed their in-store clinics in Portland Oregon.

In October 2006 a trade association for these in-store clinics was founded to lobby for insurance payments and other interests. The Convenient Care Association is a nonprofit organization representing health care facilities that provide routine, non-emergency services to walk-in patients at pharmacies.

The goal of the association is to help the in-store clinic learn to profit from acute convenient medical care. The CCA is an association of convenient care clinics that provide accessible, affordable, quality health care throughout the United States. Convenient Care Clinics (CCCs) are being launched across the country to help provide care to meet the basic health needs of the public. These health care clinics, located in convenient locations accessible to the public, are primarily staffed by advanced practice nurses, including nurse practitioners (NPs) and clinical nurse specialists (CNS). They may also be staffed by physician assistants (PAs), and/or physicians (MD or DO). CCA states; “Health care driven by the needs of the patient is at the heart and soul of the Convenient Care movement. “

It looks like the CCA has captured the high road for sound bites. The statement that healthcare is driven by the needs of the patient is at the heart and soul of the convenient care movement is a very powerful statement. It assumes that medical practices have failed. Their statement is in contrast to the public’s perception of non user friendly medical professional clinics.

I have recently received several comments from patients who were examined and blood tested in their physician’s office. The results of the examinations were called to the patients by the physician nurses. The nurses told the patients the results and physicians’ recommendations for specific treatments. One person asked to speak to the physician. She was told she had to make another appointment with the physician. The recommendation was to start a statin. The patient was afraid of the side effects of the statin. The nurse was going to call in the prescription. The writer stated “ so much for your emphasis in your blog has been on the importance of the patient physician relationship.”
“This encounter does not speak well for the patient physician relationship.” I must say the patient was correct. My hope is this is an infrequent occurrence.

Members of CCA are ATLANTICARE HEALTHRITE, AURORA QUICKCARE, CAREWORKS CONVENIENT HEALTHCARE, CHECKUPS, EARLY SOLUTIONS CLINIC, SMARTCARE FAMILY MEDICAL CENTERS, LINDORA HEALTH CLINIC, MEDPOINT EXPRESS, MEDBASICS, MY HEALTHY ACCESS, QUICKHEALTH, REDICLINIC, SUTTER EXPRESS CARE, TAKE CARE HEALTH SYSTEMS, TARGET CLINIC, THE LITTLE CLINIC, plus a large number of pharmaceutical companies.

You will notice the in store clinics are run by business people and corporations. They are not run by physicians. The primary goal is to make money. The vehicle is providing care that the primary care physician should be delivering.

The AMA in its June meeting passed a policy resolution concerning in store clinics:
“With quick clinics opening in chain stores across America staffed by nurse practitioners and physician assistants, the AMA House of Delegates made clear during the Association’s Annual Meeting that, while it’s not against the facilities in principle, it believes they are no substitute for a long-term relationship with a doctor.”

If the consumer’s clinical experience with the medical profession is negative one and CCA publicizes that its health care is driven by the needs of the patient and those needs is at the heart and soul at the in-store clinics, and you are a patient in need of convenient care, which would you choose?

If CCA’s claims were true, the answer to the question is obvious. CCA sponsored by the corporations listed is in the midst of a huge public relations campaign and media blitz to capture the hearts and minds of the public. CCA’s campaign is clever and might be extremely effective. Everyone loves the underdog, the David who is going to slay the Goliath (the AMA). CCA’s sound bites are perfect for our sound bite society. It looks as if CCA has caught the AMA flatfooted. The AMA’s response has seemed anemic so far.

Stanley Feld M.D.,FACP,MACE

This is another in my series of stories about my childhood. You could guess that I am baseball nut. I was also a pretty good baseball player. I guess it was the result of watching all those New York Yankees and New York Giants games. I made the William Howard Taft baseball team. This is one of my baseball stories.

We were playing Cardinal Hayes High School at McCombs Field in the shadow of Yankee Stadium. This was the first or second game of the season. Cardinal Hayes is a well known catholic school in the Bronx. It always seemed to me that the guys on the Cardinal Hayes team looked bigger and stronger than we did. Someone told me they were a year older than us.

I am a lefty and therefore played first base. The only other position they put lefties in those days was right field. I always had the impression that the worst guy on the team was put in right field. I chose first base and turned out to be a pretty good first baseman.

It was a beautiful spring day and we were all excited to get the game started. Cardinal Hayes was designated the home team so Taft High School batted first. Being lefty, I batted second. SM our 5’4” 130 lb. centerfielder batted first.

The Cardinal Hayes pitcher was a very tall guy (about 6’4”). He looked like a giant on the mound. SM and I were in the batters circle warming up for our at bat. I noticed the big tall guy was fast but he couldn’t get a pitch over the plate.

I told SM to be careful because this guy was wild as hell. He assured me not to worry. Anyway the first pitch went right at SM and hit him in the head. We did not have helmets in those days. SM was unconscious and the ambulance was called.

It frightened the heck out of me. I had already made my mind up on how I was going to handle myself with this pitcher. Our coach HL knew me well. He had an idea how I was going to handle myself.

I was a pretty smart kid, actually within the top 1% of my class. My father had already decided my career path. He told me I could do anything I wanted to do as long as I became a doctor. It was settled. I had to strike out quickly and not give this pitcher a chance to hit me in the head.

If I got hit in the head there goes medical school. He could knock my brains out. I knew I could not disappoint my father. He would kill me. My strategy was set. I would swing at the first three pitches no matter where they were. HL, our, coach read my mind. He came running out of the dugout as I was approaching the batters box. There was a three quarter hour delay of the game in order to get SM to the hospital. I had plenty of time to think. HL came running up to me and shouted, “Stanley I want you to keep you head in there.” The last thing I was going to do was keep my head in there and HL knew it.

I had already concluded that I was going to blow this at bat. This guy would be out of there by the time I was at bat again. Needless to say, I had trouble getting out of the way of four wild pitches. They were so wild I did not have a chance to swing and miss. To my luck and my baseball career he walked me on four straight pitches. It disrupted my strategy. All I wanted to do was get safely into the dugout.

It turned out the 6’4” Cardinal High School pitcher walked the next two batters and was taken out of the game by his coach. We went on to score three runs and win the game despite their size and strength. It was not because we were so great. We just stuck in there even though we did not want to.

The lesson to be learned is never put you head in front of a fast ball. The healthcare system lesson to be learned from this story is even though they (the healthcare insurance industry) are bigger, more powerful and stronger you need to stick in there and do the right thing.

Remember there would be no healthcare system without the primary stakeholders, the patient and the physician.

Stanley Feld M.D.,FACP,MACE

Medicare Part D is the drug benefit insurance for Medicare recipients.
The government constructed a program where the healthcare insurance industry sells insurance to provide prescription drug coverage.

There are various plans available from various healthcare insurance companies charging various prices. The healthcare insurance industry would call it competitive pricing. However, without real price transparency, multiple pricing is meaningless. The real important price is the price the patient is charged against his doughnut verses the price the healthcare insurance company pays the pharmacist. The various plans are confusing, to say the least. The plan outlines have been standardized by the government. The prices for the various healthcare companies’ plans have not been standardized.

If we drill down deeper, the price the healthcare insurance company pays the pharmacy has not been standardized. The industry negotiates that price with the various pharmacy chains. The price the healthcare insurance company charges the patient is applied against the patient’s doughnut. The patients’ doughnut (coverage gap) kicks in after the patient purchases $2200.00 of drugs. Therefore, the higher the price the healthcare insurance company charges the patient’s account for a medication the faster the patient hits the doughnut and the faster the patient pays full price for the medication. The price the healthcare insurance company applies to the patient’s doughnut has nothing to do with the price the healthcare insurance company paid the pharmacy for the drug. This is the place the fairness to the patient breaks down. Many seniors who have purchased these plans, in order to feel financially secure, are now discovering the deception in these various Medicare Part D plans.

Richard Jellicoe writes; “I have Medicare Part D from AARP. UnitedHealthcare
is the carrier. UnitedHealthcare offer drugs with co-pay almost twice what I can get the same drug via cash. I guess that is how UnitedHealthcare can pay its fired CEO $5 million a year in retirement.”

He goes on to say:“What amazes me is that AARP endorsed this company when it was time for 2007 Medicare sign up and it was not till many months later that AARP acknowledged that it’s endorsement of UnitedHealth care was a paid endorsement. And AARP is supposed to help the seniors.”

Consumers can not assume the government will protect them. It has not in the past. You can not assume that organizations like AARP who advertise that they will protect you will protect you. Consumers must become sophisticated buyers of healthcare products. Consumers have trained themselves to become sophisticated buyers of other products such as automobiles, electronics, food, clothing, and housing. They have learned to receive good value and have created competition among vendors for their dollars.
The healthcare insurance industry continually says that consumers are not capable of dealing with healthcare pricing. If you think about it our most precious possession is our health. We should be most responsible for our health and the price we pay to maintain it. I know consumers can be very smart about healthcare consumption if they owned their healthcare dollar.

Mr. Jellicoe goes on to say “I have been reading everything I can find on UnitedHealth Care. I have been amazed on how those in the know understand the lack of ethics at this company. The thought of 90% of Nevada being under the control of this corrupt company frankly scares me to death.”

Mr Jellicoe, you have defined a monopoly. Our government is supposed to be working for us and not for the healthcare insurance industry. Consumers have to demand that our government does something about your complaint. The problem is most consumers are not aware of these abuses. Our sources of information (mass media) do not provide detailed information. Detailed information does not hold our attention and attract advertisement revenue. We are an inpatient, sound bite society seeking sensational stories. However we become very concerned when an issue affects us directly. The broken healthcare system is directly affecting us all now. I believe as a people we are very smart. We are starting to demand a solution. However, the government has put the fox in the hen house to protect the hens. The hens will not be protected.
One of the reasons I am writing this blog is to try to get the people who are not sick to pay attention to what is going on. The healthcare system needs to be fixed before we get sick and need medical care and medical drug benefits.

Many years ago a well connected patient of mine was an advisor to several U.S. Presidents. He was working on stopping drug trafficking to the United States from Mexico and South America. Hundreds of millions of dollars was laundered through Miami banks. His assignment was to convince the banks to stop laundering drug money. One day I asked him why congress doesn’t just pass a law revoking the banking permits.
In his frustration, he said “most people do not know what they vote for. They do not express their opinions to how their congresspersons should vote in congress.” He said the law could not be passed because of the banking lobbys’ influence in congress. He also said” we as a people get what we deserve. We have the right to demand the appropriate action. We do not exercise that right. Until we start paying attention to what is going on and get rid of the politicians who do not do what is right out of power nothing will change”.

“All of the news in the press is about unimportant issues. Th “news” is a distractions from the real needs of the people. None of the important issues are covered in detail so that we rarely know the real issues. “

It is important to notice that the only easy way Mr. Richard Jellicoe can express his frustration is through the new media, the blogosphere. Will the new media be effective? I hope it will. Americans’ are not a stupid people. Our freedom of speech is precious. Social networking of a concerned population will change the paradigm of healthcare insurance to a consumer driven healthcare paradigm.

Stanley Feld M.D., FACP, MACE

Michael O’Grady of Grosse Pointe Farms, MI expresses the mistrust between the employers and the healthcare insurance industry much better than I can. He also confirmed for me that people on the internet are not only thinking about the problem of healthcare and what I am saying but are upset about the terrible things that are going on in the healthcare industry.

“I must comment on two key components of the healthcare system I felt were blatantly missing from your blog. ”

“The first was in your list of stake holders. No where to be found are the employer groups who actually fund most of the health care in this country.”

At the time I received Michael’s comment he was correct. I was concentrating on how the 46.7 million uninsured can be insured. The key answer is for employers to be able to provide tax deductible funds to their employees in order for the employees to purchase their own healthcare insurance policy with their own money. If an employee chooses not to buy healthcare insurance he does not get the money.

This maneuver accomplishes three things. First, it gets the employer out of the healthcare insurance loop. Employers may stay in the loop if they think they can protect their employees. Second, the employee relieves the employer of the burden of negotiating a premium at a tremendous disadvantage. Employers have noticed that they have be less than effective in keeping premium cost down in recent years as expressed by EC previously. Third, it puts the patient in charge of his healthcare dollar. This creates a huge buyer pool and forces the healthcare insurance companies to develop innovative and cost effective products. If they do not become efficient, someone will come along and take away the business.

Unemployed or self employed consumers can buy healthcare insurance with pre-tax dollars. This level playing field does not exist today. A self employed or unemployed person must be able buy insurance with after tax dollars. Notice that this simple change in the tax law would weaken the healthcare insurance industries hold on healthcare and force them to compete for the healthcare insurance dollar.

President Bush has called for this tax reform. However, there has been no follow-up. It seems he has backed off. Congress has no interest in passing this logical law that could help cure the uninsured problem. It would be putting power in the hands of the consumer. It has been opposed by the healthcare insurance companies lobbying effort. The evaluation of the Congressional Budget Office seems to point to a positive outcome when read in detail.

“Although you appear to have many good ideas, and are a proponent of changing many of the necessary evils of the broken health care system, you are in fact a stake holder.”

Michael, I am presently a consumer stakeholder. I retired from an excellent practice of Clinical Endocrinology in order to devote adequate time to help repair the healthcare system for the benefit of the consumer and the survival of the patient physician relationship. I believe the patient physician relationship is a critical therapeutic element in the care of sick patients. Making medical care a commodity will destroy medical care in this country.

“The employers are the one in the end who actually foot the bill for most of the health spend in the U.S. The unfortunate circumstance is they are being led blindly down the path of excessive baggage by consultants and their partners, who we refer to as BUCA (Blues, United, CIGNA, and Aetna).”

Michael, you are correct. The large employers have human resource officers whose responsibility is to choose the correct healthcare insurance plan for its employees. The BUCA have learned to manipulate and confuse the human resource officers. It gets back to the old question: would you let your human resource officer, or insurance company purchase your food, your clothing or your car? You might let the HR person negotiate for you. However you are the owner of the purchase and would be responsible for the choice. Your unwillingness to let the HR person negotiate for you would increase if the purchases became more confusing and unsatisfactory. You would want control.

The seller (healthcare insurance company) is motivated in the present system to confuse the HR officers. The seller also has the advantage because the number of people in a single company is small compared to the total number of people in society as a whole. The key to repair is to motivate the seller to compete. In a real price transparent environment the healthcare insurance industry would be competing for customers. All the necessary changes would have to occur at the same time for it to be effective.

“The second piece I felt that was missing was the reimbursement methodology in place today prevents any fix of the health care system. The PPO discount system is a disaster and adds between four to six billion unnecessary dollars to the health care system each year. These are dollars employer groups are paying to the BUCA’s and PPO networks in access fees each year, to provide provider discounts. Twenty years ago there may have been a value to an employer group to receive discounts in exchange for steering patients. There may have been a value to a provider to provide discounts in exchange for steerage. These days are over, and retail is for suckers.”

Michael, you are right on target. No one pays retail unless they want to. The reason Sam Walton went from a bloomer salesman to the largest department store on the globe is because he learned how to provide the best price with a good quality product to the consumer . Consumers figured out which price and product was best for them.

“So why should employers pay four to six billion a year for what really amounts to retail pricing? Transparency? Does it matter if a provider makes transparent their charge master? Each network or carrier has their own deal with each provider that is considered proprietary. What is being charged by the provider is irrelevant, thus making any HSA plan doomed to failure.”

Price transparency is bogus in healthcare lingo presently. The automobile industry is getting close to real price transparency. They are not there yet. The electronic industry is close with organizations like c/net.com and simonsays.com. The consumer is not stupid. When they are in control or their healthcare dollar they will force real price transparency. Actually, they are getting smarter each day.

“A new reimbursement methodology needs to be adopted. This new methodology needs to be developed in partnership with employer groups and providers. There is a necessity for administrative functions within the health care system. Third party payers and insurance carriers do provide a valuable service. Unfortunately, BUCA now is the majority stake holder in health care. Until this changes, and employers and providers begin to work together, BUCA and the consultants will continue to take advantage of this lack of connectivity and continue the path of absolute disaster.”

Bravo, Michael O’Grady. The easy way to accomplish your goal is to get the employer out of the picture. As EC pointed out the employer really wants to provide healthcare insurance to his employees. However, it is becoming an impossible and over costly task. Let it be between the patient and the physician. Reducing the physicians overhead by 20-30% will give the physician the ability to reduce his price. If he doesn’t he will suffer the consequence of the consumer walking with his feet and pocket book.

It does not have to be complicated. The primary stakeholders are the patients and the physicians. They should be the interface for the medical care transaction. If a hospital is too expensive, he would send his patients to another hospital. If patients had no choice of hospital the government should impose regulations on the hospitals to reduce the price. It can be done. It can also be profitable for everyone except the stakeholders that profit from the 150 billion dollars of administrative waste.

The healthcare insurance companies would once again be converted to a 6% broker and not the unconscionable owner of the healthcare system.

Stanley Feld M.D. FACP, MACE

We have established that physician fees are not the cause of the soaring healthcare costs. We have not looked at how the healthcare insurance industry tortures physicians with its adjudication of their insurance claims. MILT FREUDENHEIM in The Check Is Not In The Mail accurately describes the physician’s pain in receiving reimbursement from the healthcare insurance industry.

Every physician has experienced delays in payments as well as missed payments. Many physicians’ practices do not have the best accounting systems in the world. The practice management systems can easily overlook non-reimbursed claims for months or forever. Many physicians’ practices have outsourced their billing functions because it is too expensive and inefficient to do it in the office. This has lead to more problems and higher costs. The non–payment of claims leads to greater profits for the healthcare insurance company.

Does the fee charged by the physician get added into next year’s insurance premium charged to the employer buying the insurance for the employee? Does the insurance company credit its profits from the float toward the next year’s premium from its delayed payments? My guess is no.

Physicians pay $6,000 to 20,000 per year per physician just to file and administer insurance claims. They lose countless numbers of dollars from non-payment of claims. The lose countless numbers of dollars from miscoding claims. They loss countless numbers of dollars from the healthcare insurance company’s scrubbing of healthcare claims. There are entire subdivisions in healthcare insurance companies that scrub claims. A simple explanation of claim scrubbing is, if the diagnosis on the claim does not support the procedure, the procedure is eliminated from the claim in calculating the reimbursement to the physician even if the claim is justified medically. Many times the EOB (explanation of benefits) meaning is so opaque that one cannot tell what has been scrubbed out of the reimbursement. A physician’s office can call the insurance company and try to get an answer. However, it is difficult, time consuming, costly and often unsuccessful. Many times I believe it is purposeful on the part of the healthcare insurance company. I believe the goal is to delay payment as long as possible.

Another trick used by the insurance company is to say it never received the claim. Typically, the physician’s office waits a few months until it discovers the claim has not been paid. Then the physician’s office contacts the insurance company. The process of resubmitting the claim and getting paid takes at least another 30 to 60 days. This purposeful inefficiency takes place despite electronic billing.

“Few things rankle a doctor more than an insurance company’s saying it cannot find a claim for medical services. Particularly when there is even a signed return receipt to document delivery of the bill.”
“We actually had the little green card to show who signed for the dang thing,” said Elizabeth Wertz, chief executive of the Pediatric Alliance, a large group of Pittsburgh doctors. “We sent it by certified mail. The insurance company said they didn’t have it.”


The insurance industry is playing to the physicians’ weakness to increase the profit from the float.

“The claim was for several thousand dollars, according to Ms. Wertz, who declined to identify the company, a large regional insurer, for fear of making it more difficult to wrangle payments from the insurance company.”
“ It is a problem known to many doctors as they struggle to balance the rising cost of providing patient care with what they see as reluctance by some powerful insurers to pay promptly.”
“Tardiness or refusal to pay what doctors consider legitimate medical claims may add as much as 15 to 20 percent in overhead costs for physicians, forcing them to pursue those claims or pass along the costs to other patients, according to Jack Lewin, a family doctor who is chief executive of the California Medical Association, a professional group of 35,000 physicians.”

I am aware of a practice in California in which the insurance carrier is 1 year behind in payment and owes the practice $400,000.

How can the healthcare system stop this destructive pattern and dysfunctional behavior? If the patient owned his healthcare dollar, and knew the price he was going to be charged was the price the insurance company negotiated with the physician, the patient could pay at the point of service decreasing the physicians overhead by 15 to 20%. The saving could be passed on to the patient in the form of a reduced fee. The fee reduction would happen only in a competitive environment. I believe physicians would agree to this simply to relieve them of all the stress and costs of collections.

The float is between 29 and 44 days depending on the carrier. Athenahealth a claims-processing company, has published a rare warts-and-all look at how well — or not — the nation’s seven biggest health insurers pay their bills. Athenahealth measured many parameters such as days in account receivable, percentage of claims successfully resolved on initial submission, % of patient liability, denial rate and denial transparency to name of few. The Athenahealth results give us an idea of the unconscionable behavior of the healthcare insurance industry. The tactic plays to the weakness of physicians’ practices and take advantage of both the physician and the patient.

Ms. Wertz, the Pediatric Alliance’s chief executive, says some insurers’ telephone call centers limit claims-related issues to 10 per call. “That’s incredibly inefficient,” she said. “We see thousands of patients. Our people have to sit on phone 30 minutes to get a live person.”

Athenahealth’s other measurements included the percentage of claims paid without changes within 90 days. Medicare came in first, at 92 percent. Champus/Tricare was last, at 85.1 percent.

It should be clear that the way around this waste and abuse is with an Ideal Medical Savings Account. It would motivate the patient to shop for a doctor, and to shop for a good insurance company. The insurance companies would compete on price and quality of product. We have seen the same apathy for reform in American automotive companies until the Japanese gave the American consumer a choice. Now they are trying to catch up.

Who would lose? The slow to reform healthcare insurance company who has abused the healthcare system for many years? Do you think it wants to give up the power it has over physicians and patients? The only way to stop it is with appropriate government regulation, giving patients the power to own their healthcare dollar and total price transparency. It is going to require political leadership that can only be stimulated by consumer demand. Consumer demand will result from understanding the dysfunctional elements of the healthcare system.

Stanley Feld M.D.,FACP,MACE

I feel compelled to dwell on Alex Berenson’s article Sending Back the Doctor’s Bill because it is wrong and distracts from the main problems with the healthcare system. In fact, I find it an insult to our intelligence. I want to include some of the demoralizing examples that are widespread among the physician community. I will start by quoting Dr. Uwe Reinhardt.

“The low lying fruit in cost-containment (ie. physician reimbursement) was strip mined by the HMO movement and Medicare over 15 years ago. There is wide-spread disenchantment and lack of job satisfaction among physicians that threatens to split wide open over further aggressive pay cuts. You don’t have to be a Nobel prize winning economist to understand the inevitable brain drain and service problems you’d create.”

If you review my blog entries on how this all started in the 1980’s you will understand how the easiest stakeholder to attack were physicians.
They are disorganized, individualistic, and political when necessary, and very competitive with each other. In fact, most of the competition has been directed toward and against each other in their local communities. When they perceived that their medical organizations did not represent their interests they walked with their feet and dues, weakening major organizations, that potentially could have aborted the mess our healthcare system is in.

It was very easy for the insurance industry to dominate the practice of medicine. They started dominating the access to care and the price of care. It is only a matter of time before the entire healthcare system implodes because of the insurance industry’s arrogance and greed.

Some physicians have just walked away from their medical practice as conditions worsen and the physician shortage increases. Below is the story of a much beloved physician in Summit County Colorado who practiced there for 25 years. He was at one point chief of staff at the hospital and has served on the Frisco Town council.

Throughout the past 25 years, he’s delivered more than 300 babies, handled countless emergencies, practiced family medicine and conducted altitude research. But soon, he will be moving on.

Sid Schwab M.D. a surgeon nearing retirement said...

“I saw Dr. Reinhardt’s letter (in the New York Times), too. What’s depressing — in addition to everything else in the world — is the misconception people seem to have about what doctors (surgeons especially) do. Hey, cut their pay, put ’em on a salary, or (as one recent commentary suggested) hire a bunch of doctor/moms who’ll be glad to fill in the gaps with part-time work, flood the market –problem solved!”

Snafu Suz a cancer survivor said.

“The American health crisis is many-fold (is that a word? anyway…). There is not one answer to the problem. The whole thing needs a serious overhaul. I agree that cutting doctor’s salaries will hardly help and yes, it will demoralize our health professionals which is NOT a good thing. Personally I have a huge beef with insurance companies and think that would be a better place to start. Health care should not be a for-profit business. Doctors need to be paid just like everyone else, but insurance companies don’t need to be running the show. Maybe we should start there? Maybe we should start with campaign reform so that our politicians are not for sale to drug and insurance companies? Maybe we should start with making higher education universal so that doctors and other professionals don’t have to carry such astronomical debt? Maybe individuals shouldn’t be running to their lawyers hot to sue for things that are unproven? (The silicone implant fiasco comes to mind.) As I said, this problem has many aspects and there is a lot of corruption. Doctor’s salaries are not one of them. The guy who wrote that article is smoking crack. (Alex Berenson)

Susan”

I could go on forever but I think you get the point. We are all in search of the truth. We are all in search of the best way to Repair the Healthcare System. Mr. Berenson’s solution is not the way to repair the healthcare system.

Stanley Feld M.D.,FACP,MACE

Alex Berenson’s article “Sending Back the Doctor’s Bill” in the July 27,2007 NYTimes demonstrates the problems the mass media is having in a world of changing communication. Unfortunately, articles such as Mr. Berenson distort and misrepresent the facts.

Mr. Berenson says “Americans generally do not seem to mind the fact that doctors are well paid. In public opinion surveys, doctors usually rank as the most trusted professionals. Congress has repeatedly blocked Medicare’s efforts to reduce the amount it pays for each procedure doctors perform, even though overall Medicare payments to doctors are soaring and the cuts are legally required to keep the program’s budget balanced.”

It is important to study Mr. Berenson’s words carefully. He says “doctors usually rank as the most trusted professionals.” I believe that is true and is deserved. However, he and others are doing their best to destroy that public trust. The trust between a patient and physician (patient/physician relationship) is part of the therapeutic effect. Effective medical care is not a commodity. The therapeutic effect has a personal component that is being destroyed by our present environment.

Mr. Berenson implies that the government must “reduce the amount it pays for each procedure doctors perform.” He ignores the fact that the hospital charge for a procedure done in the hospital is greater than the physician charge to do the procedure. The hospital’s reimbursement is greater than the physician’s reimbursement for his skill and intellectual property. Recall the insurance company paid the hospital twice as much as they would have paid Dr. Westbrock if he was allowed to do the same x-ray.

Mr. Berenson’s last sentence is a warning. It should alert us to what we are in for with universal coverage, and single party payer system. It is socialized medicine.“Congress has repeatedly blocked Medicare’s efforts to reduce the amount it pays for each procedure doctors perform,” This is not true. Congress has decreased the percentage of reimbursement reductions sort by Medicare. Significant physician fee reductions have occurred yearly.

Mr. Berenson goes on to say “even though overall Medicare payments to doctors are soaring and the cuts are legally required to keep the program’s budget balanced.” Physician reimbursement has not been soaring. It has been declining. Hospital costs and administrative payments to the insurance industry have soared. The last phrase portends what we have in store for us with socialized medicine. We will see limitations to access of care, restriction of care and longer waits for care because it has to fit in a budget. We need only think of the examples of England and Canada.

The wonderful Surgeon’s Blog by Sid Schwab touched on this the other day in a post called “Times Two.”

Dr. Schwab is a general surgeon nearing retirement age who writes about the challenges in surgery. He has an excellent and informative blog.

He writes,
“Working hard for its own sake, striving for excellence without any tangible recognition will be seen in some — but hardly most– doctors if they go on a salary. Because, unsurprisingly (or maybe surprisingly, to pundits) that’s not how it works in real life. I’ve been in the military, and I’ve worked at VA hospitals. Try getting a case on after three p.m. Try getting a lab test or Xray thenabouts. Work another patient into a crowded schedule? Stay through lunch, after hours, come in early? Sorry. That’s what ERs are for. If Alex Berenson (the NYT editorialist) is ok with it, so am I. Sleep, I’ve discovered, can be a pleasant thing.”

Princeton University economics professor, Dr. Uwe Reinhardt, pretty much the “go to guy” for health care economic theory responded with a letter that was published two days latter:

In “Sending Back the Doctor’s Bill” (Week in Review, July 29), you compare the incomes of American physicians with those earned by doctors in other countries and suggest that American doctors seem overpaid.A more relevant benchmark, however, would seem to be the earnings of the American talent pool from which American doctors must be recruited.

Physicians are the central decision makers in health care. A superior strategy might be to pay them very well for helping us reduce unwarranted health spending elsewhere.”

I believe you have heard that from me repeatedly. Someone should be paying attention.
I have followed Dr Reinhardt for years. He has finally figured it out. Bravo Dr Reinhardt! Maybe we have a chance. Maybe everyone will figure it out. Maybe a presidential candidate will figure it out.

Stanley Feld M.D.,FACP,MACE

On July 29,2007 Alex Berenson wrote a lead article in the Sunday New York Times business section entitled “Sending Back The Doctors Bill.” I believe everyone should be exposed to all opinions. However, Mr. Berenson’s article needs rebuttal because he simply does not know what he is talking about.

In my view the quality of the news in the New York Times has deteriorated recently. Alex Berenson is producing yellow journalism. It is sensational and does not accurately address the problems in the healthcare system. Following on the heels of “Sicko” and the misinformation and disinformation contained in Michael Moore’s film. Mr. Berenson’s article can make people believers of the wrong conclusions. A review of Mr. Berenson’s recent articles confirmed my opinion of his sensational reporting tendencies.

This article confuses the issue of how to repair our dysfunctional and broken healthcare system. I had hoped there would be resounding public outcry against his article. Unfortunately the response was meager. I have struggled with my response because the physicians’ incomes are not the problem in the rising costs of the healthcare system. In fact, cognitive physicians (internists, and family practitioners) are not paid enough. The hospital fees, the insurance industry fees, and the exorbitant administrative fees and inefficiencies of the hospitals and insurance industry are the problem.

Let us do some math. Health costs are now $2.2 trillion per year and rising in the U.S. Physicians’ gross revenue represents about $500 billion per year of the total exclusive of overhead. The $500 billion dollars in revenue represents 22% of the healthcare costs. Therefore 78% of the healthcare cost are spent in other places. Medicare has proposed a 10% reduction in physicians’ reimbursement in 2008. Since the insurance industry adjudicates the claims for Medicare they will also try to reduce payment by the same amount for the private healthcare insurance policies they service. A 10% reduction is $50 billion dollar or 2.3% of the healthcare expenditures. The 2.3% reduction represents an insignificant reduction in the overall cost of healthcare. This reduction will generate much pain and resentment. The cost of care reduction must come from areas that generate the other 78% of expenditures. The other stakeholders have been responsible for the yearly increase in healthcare costs while physician reimbursement has decreased. A $4,000 to $30,000 a day hospital charge should raise some eyebrows.

The physicians’ payments are not the cause of the rising healthcare costs. It is the insurance industry’s fees, insurance industry’s administrative waste and salaries as well as hospital fees, administrative waste and salaries. If we knew their costs (price transparency) and we saw their profits and we forced them to eliminate waste, we would truly reduce healthcare costs.

The only way to accomplish this is by adequate governmental rules, and a consumer driven system to stimulate competition.

If we are going to have a conversation about the ills of the healthcare system this is where Mr. Berenson’s energy should be expended. Mr. Berenson has created a smoke screen with sensational reporting to distract the conversation from the real causes of increase costs to the healthcare system.

Mr. Berenson says,

“But many health care economists say both sides are wrong. These economists, some of whom are also doctors, say the partisan fight over insurers and drug makers is a distraction from a bigger problem: the relatively high salaries paid to American doctors, and even more importantly, the way they are compensated.”

He then goes on to say that “Doctors in the United States earn two to three times as much as they do in other industrialized countries.” We should probably earn more if we compare incomes and the necessary skill level required in medicine to the salaries paid to less comparable skill levels in other industries in the United States of America.

The temptation of practicing physicians is to become defensive about their income. In my mind all the defensive arguments are valid but unnecessary. It has become easier for physicians to communicate with people and each other since the advent of blogging.

Richard Reece M.D. says

“Given the years of training that doctors require, the stress, and the responsibility of their jobs, few would disagree that they should be well paid. In addition, with a year of medical school now about $30,000, many doctors leave school deeply in debt. And many doctors would argue that cutting salaries would only persuade talented, college graduates to pursue better-paying professions. These actions will worsen the doctor shortage. Presently this shortage is estimated to be about 50,000 physicians. The shortfall has been quoted to be 200,000 by 2020.”

Ask yourself, why would any bright young person spend 11 to 15 years preparing for a profession in which systematic fee reductions are guaranteed ?

Dr. Rob Oliver in Plastic Surgery 101 nailed it.

“Completely missed by the author (Mr. Berenson) is both the expense of training physicians and the “opportunity costs” invested in becoming a Doctor by highly educated people in their early twenties.”

• Tuition and living expenses during college ~ $150,000
• Tuition and living expenses during medical school ~ $85,000
• Average wage during my intern year in 1998 ~ $5.80 /hour
• Average wage my 8th year in surgical training in 2005 ~ $9.75 /hour
• Spending ages 22-35 in the library or hospital ~ PRICELE$$

It is important to note that Dr. Rob Oliver is a young physician. I applaud his frankness. In the past, policy wonks have used the argument that young physicians will not have experienced the “golden age of medicine”. Therefore they will not know any better. I believe the policy wonks are going to be in for the surprise of their life. Bravo Rob Oliver!

How do you calculate how much someone is worth? How much is Barry Bonds worth? How much is Kobe Bryant worth? How much is Paul Levy CEO of Beth Israel Hospital in Boston worth? $1.2 million dollars a year? He thinks so. How much is the CEO of United Healthcare worth? $1.8 billion dollars? How much are the CEO’s of Fortune 500 companies worth? Are any of these people worth more than $150,000 per year?

How much is the discovery and effective treatment of an illness that saves a life worth? These questions are not questions that are going to be answered by Mr. Berenson’s yellow journalism. They are also not questions that are going to be answered by academic policy makers with little to no clinical experience in the trenches. They are questions to be answered by the marketplace. The sooner we understand these questions the faster we will be able to develop a formula to repair the healthcare system.

Consumers understands these questions, especially when they become sick. However they have been rendered powerless by our present healthcare system. The people are going to have to drive the repair of the healthcare system. Government policy should be to express and service the needs of the people efficiently and effectively. Government policy should not be driven by facilitators’ vested interests.

Do you think the Insurance Industry should own the healthcare system? My answer is no! Do they? Yes!

The healthcare system should be owned by the patient. The patients should own his healthcare dollar. This is the only way that competition and innovation can be stimulated. The necessary paradigm shift is not going to be driven by the insurance industry, the hospitals, or government officials under political influences. The government can only do the right thing with the appropriate leadership. It seems to me the only potential presidential candidate that has the slightist clue to repair the healthcare system is Rudy Giuliani.

Last week Mr. Giuliani called for “transforming the way health care coverage is provided in the United States, advocating a voluntary move from the current employer-based system to one that would grant substantial tax benefits to people who buy their own insurance.

“He proposed tax exemptions of up to $15,000 per family, allowing individuals to direct that money toward the purchase of health insurance and other medical spending. He also said he opposed any government mandates that would require people or businesses to buy insurance, which is central to the universal health care plan neighboring Massachusetts, passed in April 2006 when Mitt Romney, a Republican rival, was governor there.
In order to help the poor or others struggling to afford health insurance, Mr. Giuliani said he would support vouchers and tax refunds along with savings incentives. ”

I believe Rudy Giuliani’s rhetoric is a relatively meaningless sound bite at present. However the sound bite is on the right track. I believe if his campaign gets off the ground he will be willing to learn from physicians and patients. He would be capable of leading us out of the morass we are in. He also believes the healthcare issue is a vital issue. I think he believes in sound business principles. He seems to understand the problems of the dysfunctional healthcare insurance industry.

Mr. Giuliani understands a good deal about how the free market economy works. He believes in the power of the consumer and people power. He also understands how dysfunctional systems can be repaired. Recall that he took a totally dysfunctional New York City riddled with crime and corruption, and transformed it into a functional and civilized city. He also angered a lot of the established vested interests along the way. However, most were grateful that he broke the log jam.

He transformed the national view of New York City and its people. He stimulated an unprecedented prosperity for New York City and New Yorkers at a time when companies and industries were moving out of the city. I recall being picked up by a limo driver in New York City on the way to a press conference several months after Mr Giuliani was elected. I always figure that New York City limo drivers know more about what is going on in the city than anyone else. I asked the driver what he thought of Mr. Giuliani. He said “Rudy is great. He took three police forces that did not work and made them into one police force. Believe it or not the police have been energized. The police force works. We all feel safer.” My silent response was “holy cow”. I did not think New York City had a chance. Maybe Mr. Giuliani was lucky.

Many feel the same way about the healthcare system. Repairing the healthcare system doesn’t have a chance. I think they are wrong. The healthcare system can function with the principle stakeholders, the physicians and the patients, in charge and the consumer driving the system.

I also believe Mr. Giuliani’s campaign has many problems. Many people will be against him for his views on other issues. His seemingly logic approach to the healthcare issue makes him the only possible shining star presidential candidate for the healthcare morass. He does not have the formula for repair quite right, yet he maybe a fast learner, if there is such a thing in a politician. He may also be able to stimulate a more attractive candidate to understand the desires of the people as it relates to healthcare. We need to put the people in charge not the insurance industry or the government.