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Obama Will Ration Health Care!: Wake Up America: Part 2

Stanley Feld M.D.,FACP, MACE

Mr. Obama has promised a quick, hard push to overhaul the healthcare system. Americans can expect a quick push to build a larger federal bureaucracy, impose price controls, restrict the use of new medications and technologies, boost taxes, mandate the purchase of health insurance, and expand government control of health care. This is the promise Mr. Daschle made in his book "Critical: What We Can Do About the Health-Care Crisis,"

If Mr. Obama continues on the present path the prognosis is horrible for patients, physicians and taxpayers. Tom Daschle’s excuse is the present system is an intolerable status quo. An intolerable status quo is not an excuse to destroy the healthcare system in America.

“In his book, Mr. Daschle proposes a National Health Board to regulate the way health care is provided. This board would have vast powers in regulating the massive federal health-care system — a system that includes Medicare, Medicaid, and other programs.”

Healthcare coverage will likely expand to greater government healthcare control. Businesses and corporations are anxious to get out of the business of providing healthcare coverage for their employees. They would rather pay the penalty proposed than provide unaffordable healthcare insurance for their employees. The result will be defacto socialized medicine before we know what hit us. Socialized medicine is Mr. Daschle’s plan for all Americans even though America can’t afford it. He is going to claim this is the plan the people want. I would add until the people realize the consequences of his plan.

“Given the opportunity, Mr. Daschle would likely charge the board with determining which treatments and drugs are cost effective and therefore permissible to use for patients covered by the government.”

“It is nearly certain that the process of determining which drugs and which treatments would be approved for use would be quickly politicized.”

The Federal Health Board will be made up of “expert clinicians” from academic centers who will determine what physicians can and cannot do. The enforcement of these rules will be impossible. The punitive weapon will be withdrawal of physician reimbursement. I have said over and over again that punitive measures do not work to force a workforce to comply.

“In his book, Mr. Daschle complains about overuse of new technology and praises the United Kingdom’s National Institute for Health and Clinical Excellence (NICE), a rationing system that controls government costs.”

Mr. Daschle believes that America needs to ration new technology and drugs because the cost of care is skyrocketing. Another reason is the government cannot afford to provide access to care. The result will be rationing of care rather than giving patients the freedom of choice. The British system is well known for restricting access to drugs and medical care.

He is ignoring the waste in administrative services outsourced to the healthcare insurance vendors. He is ignoring the inefficient billing practices of hospital systems. He is ignoring the responsibility patients have to adhere to treatment medications prescribed and the maintenance of their health. He is ignoring the fact that patients should be responsible for their health and their healthcare.

“Health care is personal and voters will pressure lawmakers on access to care. Americans will not put up with such limits, nor will our elected representatives.”

Mr. Daschle is claiming that through his community home meetings in December people are demanding the changes he is proposing. I believe once the voters realize what he is proposing the will voice the opposite opinion.

Managed care of the 1990’s was nothing more that managed cost. It provided the healthcare insurance industry with the opportunity to place restrictions on access to care and decrease reimbursement to vendors. It temporarily reduced the increase in the costs of care. However, managed care failed work because the public objected to the restrictions and it did not hold down costs. The HMO experiment failed for the same reason.

Tom Daschle has learned something from these lessons. He learned that he has to strike quickly and deflect the decisions about rationing of care to a “neutral board” and not the market. It is clear he does not respect the intelligence of the consumer. He does not understand the responsibility of the consumer. If he was doing this right he would be going after the abuses in the system and not the decision making engine in the system.

Tom Daschle is in the process of creating a giant HMO. It will fail as the Massachusetts experiment has failed.

“Mr. Daschle’s model is Massachusetts. But Massachusetts’s plan is an unfolding disaster and demonstrates how Mr. Daschle’s private/public model is merely a stalking horse for government-dominated health care.”

Massachusetts helped 442,000 people obtain healthcare insurance. However an additional 80,000 people were put on Medicaid. 176,000 people were put on government subsided healthcare insurance. The cost to taxpayers has exploded because the basic cause of increased cost of care has not been addressed. The healthcare insurance industry control over the healthcare dollar has to be reduced. The onset of chronic disease and the reduction of the complications of chronic disease must be attacked effectively.

“Costs have exploded, requiring additional tax hikes and the entire system is only possible due to sizable transfers from the federal government. The plans are so unaffordable that in 2007, 62,000 people were exempted from the individual mandate.

So much for universal coverage. It could work if the consumer controlled their healthcare dollars with the government protecting the consumer.

The only way the Massachusetts plan will survive is with continued and increasing federal subsidies -that is, tax revenue from the residents of other states.

Tom Daschle’s plan is going to follow the same misguided path. The problem is worse the healthcare system becomes the harder it will be to dig our way out.

Wake up America

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

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President Obama Will Ration Healthcare. Wake Up America! : Part 1

Stanley Feld M.D.,FACP,MACE

I spent a glorious weekend with Brad and Daniel in Las Vegas at the Consumer Electronic Show (CES). I thought there were some phenomenal electronics exhibited which will be coming to Main Street soon.

Brad introduced me to many young entrepreneurs who are very concerned about providing healthcare insurance for their employees. They are having trouble finding affordable healthcare insurance. My suggestion is for them to consider my ideal medical savings account.

Most of these young entrepreneurs realize they do not understand the issues that have resulted in the exorbitant healthcare insurance premiums.

I told them to not listen to the sound bytes of Tom Daschle and his team. They do not understand the issues either. If they did, they would be pursuing a different course. Tom Daschle is going to try to force the Democratic Party’s healthcare agenda of the last forty five years down the country’s throat. .

I have described most of the issues. I like President-elect Obama very much. Many voted for him because of the promise of renewal, new thinking and hope for the future.

David Remnick of the New Yorker summarized Barack Obama’s appeal.

“Barack Obama was not elected the forty-fourth President based on the depth of his legislative achievements or on the length of his public service. John McCain and Hillary Clinton were the “experience” candidates. Rather, Obama projected an inspiring message, a “narrative,” of change at a moment when so much in American life––the economy, the environment, national security, health care––is in such parlous condition that, for many voters, political familiarity seemed less a source of solace than a form of despair.

Barack Obama has hired “experienced people” to run his healthcare team( Daschle, et al). His “team” has the same old tired ineffective story that Hillary Clinton and others have had for healthcare reform. It is a story the American public does not want to hear.

During the campaign, Obama embodied novelty and a broader American coalition, and everything we heard about his temperament—as a community organizer in Chicago, as a president of the Harvard Law Review, as a legislator, as a campaigner—spoke of someone who, in contrast to the outgoing, faith-based President, possessed a gift for rational judgment and principled compromise. “

His healthcare advisors are old school. They do not understand the importance of the physician patient relationship. They refuse to understand the problems in the healthcare system. They ignore the importance of patient responsibility for their own health and healthcare. They do not seem to believe in the importance of the role of incentives and self reliance as an engine of America’s greatness. They believe government can fix everything.

President Barack Obama’s healthcare team is going to be successful in passing healthcare legislation. Healthcare system reform they will propose and pass will fail. It will bankrupt America as it is bankrupting Massachusetts.

The Congressional budget office estimated a 100 trillion dollar a year healthcare deficit in forty years without an improvement in the health of seniors alone. Adding the entire population to the Medicare roles will make this deficit unimaginable.

Tom Daschle’s plan is similar to the Massachusetts universal healthcare plan. We must understand the cause for the failure of the Massachusetts plan in order to comprehend the impending failure of Tom Daschle’s plan. There is nothing innovative about his plan. It is the same plan Hillary Clinton advocated in 1993 and others in the Democratic Party advocated for many years.

The plan will probably pass in a congressional vote because Americans are frightened by a huge economic recession. They have little idea what is being advocated by the Daschle healthcare team.

When a population is frightened all politicians have to promise is hope. People will give unprecedented power to politicians even if they do not understand the results of those promises.

Many are claiming Ayn Rand was right 52 years ago when “Atlas Shrugged” was published. The names of the new controlling bureaucracy are different but the methodology is the same.

Where are you John Galt?

Mr. Obama is taking a dangerous chance by advocating these old, and proven to be ineffective ideas. The Congressional Budget Office (CBO) noted in its report the failure to reduce the cost of healthcare significantly or increase the quality of care. The CBO’s report was published just before Christmas when everyone’s thoughts were on the holiday.

Wake up America!! Please !!

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

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Dear President-elect Obama: Part 6 Why Don’t You Listen To Practicing Physicians?

 

Stanley Feld M.D.,FACP,MACE

I am asking your administration to use common sense to repair the healthcare system. So far I have only seen political strategy. A strategy that I predict will fail as I predicted the Republican Governor Romney’s universal healthcare strategy would fail in Massachusetts.

No one in your administration is asking for advice from the physicians in the trenches. The practicing physicians are your workforce. The administrators and consultants at large hospital systems and mega clinics are not your prototypical workforce. Practicing physicians are experiencing the bad effects of the faulty healthcare policy of the past. Those healthcare policies have commoditized medical care and destroyed the patient physician relationship. I will explain the patient-physician relationship in the next blog. I am afraid you are about to compound past errors with Tom Daschle’s proposals at a very high cost to taxpayers.

Our present problems are not the result of bad intentions on the part of the federal government. They are the result faulty regulations piled upon faulty regulations to correct the previous faulty regulations. Stakeholders have been driven to adjust in order to benefit from these complex regulation to protect their vested interests.

Willie Sutton said we should go where the money is. In healthcare the biggest waste of money is in:

  1. Administrative waste; $ 200 billion dollars per year
  1. Ineffective chronic disease management: 80% of the healthcare dollars spent or $1.6 trillion dollars per year
  1. Lack of a universal electronic medical record: $75 billion dollars per year wasted in production time, duplication of testing, and illness from medication errors and communication errors.
  1. Defensive medicine: $160 billion a year.

Tom Daschle should be going where the money is and solving these problems. He should not instituting a bureaucracy that will not improve care or save money.

Two hundred billion dollars is wasted on administrative costs. These costs are passed on to consumers. All the stakeholders inject wasteful administrative costs into the system.

The largest administrative cost is generated by the healthcare insurance industry. It has grotesque executive salaries and excessive service fees. Since the healthcare insurance industry administers Medicare and Medicaid services for the federal government, the federal government is paying those costs plus a commission. Mr. Daschle should be focused on discovering the actual cost of healthcare insurance.

The second large waste of funds results from the complications of chronic disease. The estimate is the complications of all chronic diseases cost the healthcare system 80% of the healthcare dollars. If the healthcare system cost our nation two (2) trillion dollars last year the complications of chronic disease cost the healthcare system $1.6 trillion dollars. Diabetes mellitus cost the healthcare system $200 billion dollars last year. One hundred and sixty billion dollars ($160) was spent on the complications of diabetes mellitus. CMS estimated that the cost is even higher at 90% of the healthcare dollar spent for chronic disease complications.

There is little support for physicians to develop chronic disease management in their offices. Therefore physicians have little incentive to invest resources for chronic disease management. The government has supported pilot studies that have shown chronic disease management is ineffective. Chronic disease management is not ineffective. The way the pilot programs delivered the management was ineffective. Patients must be taught how to manage their chronic disease to avoid the complications of their chronic disease. If they effectively managed their chronic diseases patients could reduce the complication rate of their disease by at least 50%. Fifty percent of $160 billion dollars would result in an $80 billion dollars savings to the healthcare system. Effective chronic disease management is not supported by the government or the private healthcare insurance industry. Systems of care could easily be set up with rewards for physicians and patients who execute chronic disease management effectively.

A universal electronic medical record could be distributed by the government. Physicians would be charged by the click for it use. There would be no up front cost per physician ($60,000) for the EMR software or or maintenance service fees. All updates would be free and downloadable. Adoption of the EMR would be rewarded and the physician would pay a small fee by the click deducted from the service provided.

Defensive medicine costs could be eliminated with common sense malpractice reform. Texas malpractice legislation could be a model. It has decreased malpractice claims by over 60%. The plaintiff attorneys have taken an income hit and are trying for rescind Texas medical malpractice reform.

Your administration should be going to where the money is rather than developing a more complex bureaucracy with the potential for abuse. Repair of the healthcare system should be consumer directed with the help of the government and not government directed.

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

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Consensus: A Clever Way To Build One, Whether It Is Right Or Not

Stanley Feld M.D.,FACP,MACE

 

President-elect
Barack Obama is inviting Americans to spend part of the holiday season talking
about health care — and report back to him.
He is encouraging average
Americans to host informal gatherings to brainstorm about how to improve the
U.S. system. Thomas
A. Daschle
will attend at least one and prepare a detailed report, complete
with video, to present to the next president.

These sessions, are to be held Dec. 15 to Dec. 31. One might be invited if
one made a contribution to President-elect Obama’s presidential campaign.

"In order for us to reform our health care system, we must first begin
reforming how government communicates with the American people," Obama said in a
statement yesterday. "These Health Care Community Discussions are a great way
for the American people to have a direct say in our health reform efforts."

President-elect Obama’s statement is absolutely compelling. I believe his
heart is in the right place. However, he is ignoring the other half of the
primary stakeholder equation, the practicing physicians.

By applying the high-tech tools and grass-roots activism that helped him
win the White
House
, Obama hopes to circumvent many of the traditionally powerful special
interests that have quashed previous health-care reform efforts.

I believe Tom
Daschle has decided on his legislative initiative already
. Max
Baucus (D) Montana has introduced an identical plan to congress
.

Senator Kennedy is next. This call for pseudo public involvement by Barack
Obama is a clever mechanism for claiming a CONSENSUS.

"What
we want to do now is to move to a discussion across the country," Daschle said
in a speech yesterday in Denver
. "We want your exact ideas." By seeking
broad public input early in the process, the incoming administration hopes to
avoid some of the mistakes of President
Clinton
's failed initiative 15 years ago, said Daschle, who is also Obama's
choice for secretary of health and human services.

"Once we get started, we have to stay focused. Let's finish it, let's not
put it down."

President-elect Obama’s healthcare plan is similar to President Clinton’s
failed plan. Tom Daschle spearheaded the Clinton plan in 1993. The Obama/Daschle
plan is a plan for socializing medicine as the solution to our dysfunctional
healthcare system. It is absolutely the wrong strategy and will make things
worse.

The strategy to get the Obama/Daschle healthcare plan past is clear. I
believe their consensus strategy will be so effective with the American people
it will overwhelm common sense. Even Harry and Louise can not
help

John Goodman of the
National Center for Policy Analysis
had a brilliant blog concerning
consensus building as it relates to medicine. This blog entry is a worthwhile
read.

He begins by saying lots of Democrats have a health plan (Daschle, Baucus and
Kennedy). And the chattering class is exuberant over the idea that a
consensus is emerging on health reform. With respect to the twin problems of
cost and quality, just about everyone seems to hold these positions:”

Consensus Point No. 1:

I AM NOT AT FAULT.

Consensus Point No. 2:

Somebody else is at fault; and, not to put too hard an edge on it
and you may have to read between the lines to see this, but a reasonable
inference is that DOCTORS ARE AT FAULT.

Consensus Point No. 3:

Again, not to put too hard an edge on it and you may have to read
between the lines even more diligently, but once you do you will surely conclude
that we must FORCE DOCTORS TO CHANGE THE WAY THEY PRACTICE MEDICINE.

I am afraid Americans are being set up. The “consensus” is going to sweep a
defective healthcare policy through the door. The result will be a very
ineffective form of socialized medicine. The plan will not cure obesity, the
complications of chronic disease, or the abuses to the healthcare system by all
the stakeholders.

When the Obama/Daschle plan is passed we will really have problems. Patients
will not have freedom to choose. Access to medical care will be limited.
Physicians will have further restrictions on their ability to deliver medical
care they think necessary. The government will experience unbelievable cost
overruns.

Tom Daschle’s plan does nothing to repair the dysfunction in the healthcare
system. Doing the right thing seems so easy to me. I can not understand why
politicians who do not understand medicine and the importance of physician
patient relationship do not want to listen to practicing physicians. Politicians
must use common sense. I hope President-elect Obama grasps the concept before it is to
late for the healthcare system.

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

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Health Insurers Will Accept Universal Coverage! On Condition!

Stanley Feld M.D.,FACP,MACE

A few weeks ago in a speech in Detroit the CEO
of Aetna Healthcare Urged Mandatory Health Care Coverage
.

He
said it would lower costs
healthcare insurance
costs
.

Of course the CEO of Aetna would want mandatory healthcare coverage with the
government providing a subsidy to consumers who could not afford to buy
healthcare insurance. The
more lives insured the more profit his healthcare insurance company would
make.
Aetna CEO’s statement is clearly self serving.

The cost of healthcare insurance could decrease or stay the same.

If the government subsidizes the premiums of all Americans the price of the
premium might also go up. The
Massachusetts mandate has experienced cost overruns
for a very simple reason
Premiums have gone up in Massachusetts and the government has paid the
difference. Premiums are put out for bids and the healthcare industry is in
control of determining the bid.

"The
health insurance industry said Wednesday that it would support a health care
overhaul requiring insurers to accept all customers, regardless of illness or
disability. But in return, the industry said, Congress should require all
Americans to have coverage.”

Consumers should have freedom of choice of physicians. If they want
healthcare insurance they should be able to buy it. If they qualify for
government assistance they should be able to buy it under the same conditions a
consumer not qualifying for government assistance buys insurance. The government
should not mandate consumers to buy healthcare insurance.

The healthcare insurance industry claims “In the absence of such a
mandate, insurers said, many people will wait until they become sick before they
buy insurance.”

If the consumer got sick and did not have healthcare insurance the financial
penalty for buying insurance after they got sick would be higher than before
they got sick. This would be a deterrent to consumers’ gaming the system and not
becoming covered by insurance. Healthcare insurance at an affordable price
should be available to all.

“The proposals, put forward by the insurers’ two main trade associations,
have the potential to reshape and advance the debate over universal health
insurance just as President-elect
Barack
Obama
prepares to take office.

The problem is there is no transparency in the pricing of healthcare
insurance nor is there an effective system of competitive pricing. There is also
no deterrent to overuse of the healthcare system by consumers. Consumers have no
incentive to keep the price down for their care. There is no price transparency
or pricing competition among hospital systems. Hospital systems have inflated
fees. Their actual costs of services are not transparent to the government or
the healthcare insurance industry.

Physicians can be patient advocates. The public must be empowered to make
physicians competitive.

Finally, pharmaceutical prices are random and in most causes not justified.
There are at least five different prices for pharmaceuticals. The prices vary
from a retail price, an average wholesale price and a wholesale price.

The temptation by healthcare policy wonks is to regulate the pharmaceutical
industry by imposing price controls. Price controls never work. They only make
things worse. Real price transparency and competitive pricing of drugs is
essential. It is also essential to make physicians aware of the prices of drugs
they prescribe. If the brand name drug is ten times the price of a generic drug
both the patients and physicians should know it and be aware of the difference.
If physicians feel the drug effect of the brand does not justify the price
difference. Physicians will order the generic drugs.

“Research suggests that some insurers turn down 10 percent or more of
applicants for individual coverage because of their pre-existing medical
conditions.

A
55-65 year old male with mild obesity (BMI=28), mild hypertension and an LDL of
105 (normal is less than 100) would be rejected by a healthcare insurance
company. If he was in a group insurance plan he would be accepted.
Unknown
to his employer the premium the employer pays for all his employees would be
increased. Medicare will automatically accept this person at age 65.

“Mr. Obama said he wanted to be certain that insurance was affordable and
available to all before considering such a broad requirement”

This is very wise on Mr. Obama’s part because the insurance industry is going
to control the premium. He needs to guarantee affordability.

“In the individual market, people can choose whether or not to apply for
coverage,” Mr. Hamm said in an interview. “If they know they can obtain coverage
at any time, many will wait until they get sick to apply for it. That increases
the price for everyone.”

The insurance industry wants to be assured that the market is expanded. They
are killing the goose that laid their golden egg because they can be cut out of
the picture entirely.

“The new policy statements are silent on two important issues: how to enforce
an individual mandate and how to regulate insurance prices, or premiums. While
insurers would be required to sell insurance to any applicant, nothing would
guarantee that consumers could afford it. Rate regulation promises to be a
highly contentious issue, since it pits the financial interests of insurers
against those of consumers.”

Medicare has guaranteed rates and insurability regardless of the severity of
the illness. The government subsides the shortfall. The insurance industry’s
only interest is net profit without price transparency.

Alissa Fox, a vice president of the Blue Cross and Blue Shield Association,
said the individual mandate was an indispensable corollary of any approach
forbidding insurers to reject applicants because of health status.

If the healthcare insurance industry continues to make demands that guarantee
excess profits the government will impose universal coverage with a single party
payer (socialized medicine) and all
the problems that will bring
.

 

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

 

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Aetna CEO Urges Mandatory Health Care Coverage

 

Stanley Feld M.D.,FACP,MACE

He says
it would lower costs

Of course the CEO of Aetna would want mandatory healthcare coverage with the
government providing a subsidy to consumers to buy healthcare insurance. The
more lives insured the more profit his healthcare insurance company would
make.

“Americans should be required to buy health
insurance
, bringing healthier people into plans that will help
bring down costs, the chairman of one of the nation's largest private insurance
companies told a Detroit audience Tuesday.”

This is obviously self serving. Massachusetts
bought into this concept only to see the premiums and state subsidies go up
.
As long as the healthcare insurance industry’s administrative costs are opaque
and not transparent the healthcare premium costs will not go down.

A mandatory system misses the point of the dysfunction in the healthcare
system. The healthcare insurance industry would become more powerful. The
healthcare insurance industry’s increased control over the healthcare system
would add to the dysfunction.

The
incentives of all stakeholders must be aligned and consumers must be in control
of their healthcare dollar and not the healthcare insurance industry
. The
insurance company should be in control of the dollars spent after $6000
dollars.

“A mandatory system would help bring down costs and end a problem known
in the industry as cherry-picking — enrolling healthy applicants and rejecting
those with prior medical problems — because costs and risks would be spread
over a larger group of people, Williams said.”

The
cherry pickers are the healthcare industry.
The healthcare industry is
required to insure people in an employer group. However, if sick people are in
the group the group premium is increased. Cherry picking occurs when an
individual tries to buy insurance. If the consumer is 55 years old and recently
unemployed he is unable to get insurance if he has hypertension and diabetes. If
he could get insurance the premium would be high and he would be paying with
after tax dollars. The healthcare insurance industry would love every healthy 20
year old to be insured.

Mr. Williams has produced a smoke screen to give states the idea that they
should make health insurance mandatory. He has no interest in repairing the
system because that would decrease Aetna’s profit.

Williams is also in favor of:

“• Selling health insurance across state lines, a proposal favored by
Republican presidential candidate John McCain.”

The healthcare insurance industry has lobbied John McCain to take this
position. This form of deregulation would have adverse effects on the healthcare
system. State
Boards of Insurance can eliminate insurance abuse by refusing to grant a health
insurance carrier a permit to sell insurance in its state because of abuse
.
So far state boards of insurance have not imposed this penalty. Healthcare
insurance company abuse has only been punished by weak and insignificant
monetary fines. John McCain would eliminate this potential protection for
consumers.

“• Expanding access of those now eligible for Medicare and Medicaid
programs.”

John McCain would also like to eliminate the Medicare entitlement.
He would like to move all Medicare patients to private sector run Medicare
Advantage program. The Bush Administration has increased the subsidy to the
healthcare industry for Medicare Advantage $3,600 per patients. The
healthcare insurance industry has increased profit last year by over 5 billion
dollars from the Medicare Advantage program with only 20% of the potential
patients being enrolled. .

"No candidate has the right answer," Williams said.

Neither candidate's program suits Mr. Williams’ goal of increasing his
massive profits.

John
McCain essentially has no program.
Mr. Williams and Aetna would have to
continue to build up it power slowly.

President-elect Barack
Obama has a program that will fail
because it is outsourced to the
healthcare industry. In my next post I will explain how he can convert his
healthcare plan to a healthcare plan that will succeed. 

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

  • Glenn

    Stanley, you are absolutely right. Aetna is in no way interested in healthcare reform as their own web site makes clear when you cannot select an NP as a primary care provider, even when the only healthcare provider in 50 miles is an NP. Aetna is interested in government subsedies and that is all. Actual healthcare is irrelevant. Sad that so many people seem to think that insurance coverage and healthcare are the same thing.

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Politicians Give Me A Headache: Part 3

 

Stanley Feld M.D.,FACP,MACE

As the Presidential campaign comes to a close the important issues of the campaign get blurred or discarded. Healthcare reform is one of those issues.

In the past I enjoyed the clarity of thinking of the Wall Street Journal editorial page. Lately it has adopted a patina of fuzzy thinking and muckraking. It frequently misses the essential issues in the name of free enterprise. Last week Newt Gingrich said something intelligent. He said the Republican party should abandon the notion of anti-government for the notion of government involvement with competent management. Barack Obama has hinted that he gets it. 

John McCain does not have a healthcare plan. His healthcare plan has one tactic but is not a strategy to repair the healthcare system. It is an anti-government tactic. An effective healthcare plan must have many tactics. The tactics must align the agendas of all the stakeholders. The most important agenda is the medical care provided to consumers. John McCain’s tactic keeps control of the healthcare industry in the hands of the healthcare insurance companies. The healthcare insurance industry is the stakeholder that has abused the healthcare system. Its abuse has led to the abuse by other stakeholders.

John McCain’s healthcare tax credit is supposed to permit the self-insured to pay for healthcare insurance with pre-tax dollars as opposed to post tax dollars. Employer provided healthcare insurance presently pays for employee insurance with pretax dollars.

Equal tax treatment for employers and self employed should have been instituted years ago. John McCain’s non healthcare plan has many problems. His tax credit is not large enough compared to the cost of healthcare insurance. His plan will give employers an excuse to abandon providing healthcare insurance for its employees. The result long term will be an increase in the number of uninsured. A worker earning $40,000 cannot afford $12,000 a year for healthcare insurance for his family even if $5,000 is tax free. The problem is the cost of insurance and the cost of care.

The Wall Street Journal editorial spends time criticizing the Obama campaign for John McCain’s deficiency.

“One underreported story of this election is how heavily John McCain has been damaged by Barack Obama’s television ad assault on his health-care plan. A lot of voters seem to believe the Democrat when he says that Mr. McCain wants to deny them coverage or bankrupt them with crushing hospital bills.”

Barack Obama’s television advertisement is correct. The result of Mr. McCain’s “healthcare plan” will be just that because “affordable plans” will be sold that do not provide adequate healthcare coverage. We are seeing it now with higher co-pays, higher deductibles and underinsured. The healthcare insurance industry’s goal is to maintain high profits without regard for other stakeholders’ needs.

The Journal spends most of the article criticizing Jason Furman, who is Mr. Obama’s economic policy director because he agrees with Mr. McCain’s tactic. John McCain’s tactic is a tax credit for the self employed that is long overdue. Jason Furman does not agree with the taxable income portion of employer provided healthcare insurance. John McCain’s tax credit, taxable income proposal would result in the elimination of employer provided healthcare insurance.

The problem is healthcare reform needs more than one tactic. It needs innovative reform of the healthcare system. Effective healthcare reform must put the consumer in control of his healthcare dollar with incentives for rewards if consumers use their healthcare dollar wisely. Government and the healthcare insurance industry’s control of the healthcare dollar has not worked. Government control does not work because the government can not manage effectively and outsources control to the healthcare insurance industry.

I do not agree with Senator Obama’s plan because it is going to head us down the road of government as a single party payer with healthcare insurance company management like the Massachusetts plan.

Neither candidate has a viable plan. The WSJ editorial does not focus on the issue of healthcare reform. It confuses us about a sidebar tactic.

“ But wait, let’s consult another one of Mr. Obama’s advisers. David Cutler, the Otto Eckstein Professor of Applied Economics at Harvard, put it this way: “Health insurance is not something that is made better by tying it to employment. As a result, essentially all economists believe that universal coverage should be done outside of employment.”

That passage comes from Mr. Cutler’s 2004 book, “Your Money or Your Life,” which outlined a strategy for universal health care. Not surprisingly, Professor Cutler’s plan, like Mr. McCain’s, also applied subsidies such as “tax credits — people get a lower tax bill, or a refund from the government, to be used to purchase insurance.” In this he was echoing many other liberal health experts such as MIT’s Jonathan Gruber, another Democratic policy star.

I think the WSJ thinks Americans are stupid. If they throw enough unrelated quotes at us we will be totally confused.

I believe as Colin Powell believes. Barack Obama is potentially a transformational figure. He seems to have a deeper view of issues than most. Hopefully, he is smart enough to see through the folly in his healthcare advisors’ plans. John McCain is not transforming anything.

  • Alan Shimel

    Stan – I agree with you. The WSJ is just not what it used to be. But than again neither is Wall Street itself. Do you think Murdoch owning it has anything to do with it? Will the WSJ become the print version of Fox News “fair and balanced”? I hope not. What a shame to see another American institution watered down.

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Is Medical Care a Right or a Responsibility?

 

Stanley Feld M.D., FACP, MACE

During the debate on October 7 the presidential candidates were asked if healthcare was a right or a responsibility. In my view neither candidate answered correctly. It demonstrated each candidate’s lack of understanding of the issue.

McCain said:

I think it’s a responsibility, in this respect, in that we should have available and affordable health care to every American citizen, to every family member. … But government mandates I — I’m always a little nervous about. But it is certainly my responsibility.”

John McCain’s answer is  incomprehensible. He is desperately trying to stay on message. He wants to transfer all entitlements including Medicare, and Social Security to the private sector. One has the think of the disaster the privatization of Social Society would have been during this economic meltdown. I think John McCain understands the weakness of his position on entitlements. He weakened himself even further with unconnected gibberish.

Obama said:

“I think it should be a right for every American. … for my mother to die of cancer at the age of 53 and have to spend the last months of her life in the hospital room arguing with insurance companies because they’re saying that this may be a pre-existing condition and they don’t have to pay her treatment, there’s something fundamentally wrong about that”

Barack Obama’s answer does not prove it should be a right. It shows the power and callousness of the healthcare insurance industry. I have said over and over again that the healthcare insurance industry is not the solution, it is the problem

Both candidates’ get a poor grade for their answer. Their answers indicate neither one has an understanding of the healthcare problem. If you do not understand a problem you can not develop a viable solution to fix the problem. The solution has to be fair to all stakeholders.

The correct answer is the individual’s healthcare should be both a right and a responsibility. Healthcare coverage should be the right of every citizen regardless of age, preexisting illness or income. If citizens choose not to be responsible for their health they should suffer a penalty. If a person is ill he should be responsible for adhering to the medical treatment and follow up or suffer a penalty.

If a citizen suffers a random non-curable illness it is an actuarial hazard that insurance should protect against. If a citizen takes care of his chronic disease to avoid complications he should receive a reward. The process will stimulate responsible behavior for the person’s well being.

Obesity should be discouraged. It is a self inflicted major risk for chronic disease. Nothing is being done to reduce its’ incidence.

Affordable availability of healthcare should be a right of every citizen. At the far end we have  viable safety net hospitals. It seem the present administration is doing everything in it power to eliminate these facilities. John McCain’s thinking implies he will do the same.

Citizens should own their healthcare dollar as outlined in my ideal medical savings account. Employer based healthcare insurance has been the foundation of our healthcare system. In recent years employers have been ripped off by the healthcare industry. If the first $6000 of healthcare coverage was the responsibility of the employee and the employee could keep any money not spent for retirement, the employee would have the incentive to shop for the best medical care at the best price. A communications system could be set up to direct patients to this best care model. This system would provide incentives for caregivers to provide better care.

If a person was self employed or unemployed, means testing would determine the subsidy or payment on a fair basis.

Educational programs for avoiding chronic diseases must be set up or supported through grants by the government to encourage citizens to be responsible for their right.

The government must be responsible for passing legislation to promote environment reforms. Dirty coal plans should be banned. We could prevent at least 21,850 hospital admissions per year nationally. There were 26,000 Emergency room visits for asthma alone last year. Asthma is the No. 1 cause of kids ending up in the Emergency Room. Dirty coal burning power plants cause 554,000 asthmatic attacks, 16,200 attacks of chronic bronchitis, 38,200 heart attacks and 23,600 deaths per year.

I have emphasized that preventing chronic disease and its complications is the key to reducing our healthcare costs. Eighty percent of our healthcare dollar is spent on the complications of chronic disease. Ninety percent of the Medicare dollars are spent on the complication of chronic disease.

 

The narcotics industry is another big problem ”The cost to society of illicit drug abuse alone is $181 billion annually.”

Societal costs combined with alcohol and tobacco costs, exceed $500 billion including healthcare, criminal justice, and lost productivity.

The cost of drug addiction is a tremendous burden to the healthcare system. Yet we are supporting a government in Afghanistan where both the enemy and the government profit from narcotics without the United States doing anything about it. There is no sign that the next administration will do differently.

Americans must wake up. The Presidential candidates must wake up. We need universal healthcare. It is a right and responsibility of every citizen. It is the responsibility of the government to promote a healthy environment so we can exercise our responsibility to remain healthy.

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

  • Sarah

    I recently came across your blog and have been reading along. I thought I would leave my first comment. I don’t know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.
    Sarah
    http://www.lyricsdigs.com

  • rocky

    this is a nice post

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Everyone Wants To Be Bailed Out: Part 1

 

Stanley Feld M.D.,FACP,MACE

 

Massachusetts will receive $10.6 billion dollars over three years from the federal government to help fund its mandated universal healthcare insurance debacle. President Bush’s goal is to move government entitlement programs to the private sector. Medicare and Medicaid would be moved to the domain of the private healthcare insurance industry if he gets his way.

From the onset Mitt Romney’s ill conceived bipartisan universal healthcare legislation in Massachusetts was destined to fail. It was destined to fail because it would be financed by the state but run by the private sector without changing the structure of the healthcare system. It was clear to me the universal healthcare plan would go through a series of modifications at taxpayers’ expense while the healthcare insurance industry profited and access to and coverage for healthcare decreased. The Massachusetts’s universal healthcare plan is failing despite the disinformation and misinformation of Massachusetts officials.

“At a time when many states are facing substantial cuts in federal financing, Massachusetts will be able to expand its first-in-the-nation healthcare law because of a federal promise of $10.6 billion dollars over the next three years, Governor Deval Patrick said yesterday.”

The federal government is bailing out the universal healthcare coverage program because of increased premiums demanded by the healthcare insurance industry.

Making things worse is new state legislation raising taxes on employers not offering enough employees healthcare insurance.

“Under Massachusetts’ landmark health care law, employers who did not enroll at least a quarter of their workers in an insurance plan or contribute a third of the premium costs faced a $295 annual fee per worker.”

The reasoning is faulty after the state’s promise to guarantee universal care at no penalty to employers. The error made by the state was to provide universal care with the healthcare insurance industry being in control of the healthcare dollars rather than the consumers being in control of their healthcare dollars.

If patients were in control of their healthcare dollars and had the right to save for retirement the healthcare insurance dollars not spent for retirement two things would happen. Consumers would be motivated to carefully spend their own healthcare dollars and the administrative costs in first dollar coverage would be eliminated.

“Sarah Iselin, commissioner of the Massachusetts Division of Health Care Finance and Policy, said the new regulations would help ensure that all businesses are making a fair contribution to support the new insurance law.”

In addition to the $10.6 billion dollar bailout the division of healthcare finance is taxing employers. Employers are first, consumers are next and then providers. The state and federal government are presumably finished contributing.

“The long-term success of health care reform requires the continued shared commitment of consumers, employers, providers and government to achieve near-universal coverage in Massachusetts,” Iselin said.

Businesses said the changes run counter to the original intent of the so-called “fair share contribution” portion of the original law, which was designed to encourage employers to offer insurance to workers — but stop short of a mandate.

Businesses should not be surprised at this turn of events. Romney’s universal healthcare plan used the wrong formula in the wrong state.

“The deal, struck after months of delicate negotiations, gives Massachusetts about $2.1 billion more than it received from the government in its last round of negotiations three years ago for its Medicaid waiver package. The waiver allows Massachusetts to provide subsidized health insurance to some residents with incomes higher than would typically be allowed under traditional Medicaid rules.”

People who cannot afford healthcare insurance should be subsided. However, they have to be motivated to take care of their health and be concerned about spending their healthcare dollars. This connection is not made by anyone in government.

“Several state leaders characterized the agreement as a federal stamp of approval for Massachusetts’ historic healthcare law, which was enacted in 2006 and requires nearly every resident to have coverage.”

State leaders are living in a fantasy world. Citizen of the state will pay the price for state leaders inability to think clearly about this issue.

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

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