Stanley
Feld M.D.,FACP , MACE

 The Obama administration has encouraged local hospital systems
throughout the United States to consolidate physicians practicing in their
hospitals.

Hospital systems have found this attractive. There has been a
movement to buy physicians’ practices and then pay physicians a salary. This
has been encouraged by the Obama administration because someone in the
administration believes this will encourage physicians to stop over testing.

Hospital systems love it because they understand that brick and
mortar facilities are not worth as much as they use to be. If they own
physicians’ intellectual property in the form of primary care physicians and
skills in the form of surgeons, the value of the hospital system increases. 

It has not worked out as well as many hospital systems would
like because when physicians worked for themselves they were more productive
than when they worked for the hospital system.

The Obama administration also believes that it can bundle the
payment of a treatment and share the savings with the hospital system if the
treatment costs less. If the treatment uses more assets and costs more the
hospital system will not be paid.

In other words, the government and the healthcare insurance
industry want to offload the risk of treatment to the hospital system. They
administration thinks this will force hospital systems to deliver a better
quality of care. You may recall quality of care has not been defined
adequately.

The example often used is the non-payment for hospital
readmissions within thirty days.

This policy doesn’t work because reasons for hospital
readmissions are multifactorial. Many of those factors are uncontrollable. One
hospital system can also divert the patient to another hospital system or treat
the readmitted patient in the emergency room.

The Obama administration is encouraging Accountable Care
Organizations. There are so many problems in forming, administrating and
managing ACOs that they are destined to fail.

Anyone reading the administration’s propaganda would not think
so, but it is true, and as time goes on it will become apparent.

Finally, hospital systems and physician groups are realizing the
negotiating power they are accumulating by consolidating and integrating
physicians’ practices.

Consolidation is not good
for the patients. It is great for the hospital system and the large independent
physician specialty groups. Physicians who have sold their practices to
hospital systems will not do so well because the hospital systems are in
control of the collections and salaries.

Large medical specialty groups are negotiating with Obamacare’s
new healthcare plans. These providers are demanding, and in some cases
securing, pretty rich reimbursement rates from the new Obamacare health plans.

It is the same thing that happened in the 1980’s when HMOs
negotiated high reimbursement deals with medical and surgical specialists the
HMO wanted in the group. The HMO’s reasons were to promote the HMO’s brand and
to get better medical results for the patients they had enrolled.

“To take care
of patients that will be covered by the new insurance scheme, these providers
are requesting payment rates that are higher than what they're being offered by
Medicare. Some providers are even insisting on premiums over what they're paid
by the existing private, employer-based health plans.”

Hospital systems in a town they dominate are doing the same
thing. The result will be an increase in the costs to the government and the
healthcare insurance companies. They will pass the increased costs on to the
consumers.

“Some of the
Obamacare plans, stuck in markets where there are few competing groups of
providers to choose among, are being forced to accept these high prices.”

The Obama administration told us, at the passage of Obamacare,
that providers would be discounting to get the volume of business that
Obamacare offered as the new legislation banded large groups of patients into
statewide insurance pools.

The defective central premise was that Obamacare would entice
providers to take lower reimbursement because of increased volume.  

“The people
that now seem most likely to enter these state-based insurance pools, and buy
the new coverage, represent a costly mix of patients with a lot of pre-existing
medical conditions. The volume is also unlikely to materialize.”

Obamacare has tripped over its central premise. It is not going
to lower costs. It is going to raise costs.

Obamacare has stimulated the consolidation of hospitals and
physician groups that's now rampant in healthcare. This consolidation is
starting to give providers leverage over Obamacare’s health plans.

This unintended consequence of Obamacare was obvious to most
healthcare policy thinkers who believe that control and planning do not work.
Unfortunately, President Obama did not listen to them.

The other thing President Obama did not listen to is that Health
Maintenance Organizations (HMO’s) of the 1980 and 1990s did not work. Obamacare
is a HMO on steroids.  

 “Under the scheme, doctors are paid lump sums of money to care
for large groups of patients.

“The idea is to put the financial risk on the doctor for the
cost of the medical care that they deliver. This was a central premise for how
Obamacare would put financial pressure on providers as a way to help to lower
healthcare costs.”

Physicians and Hospital Systems have been to this movie before. 

Hospital Systems are making believe they are taking Obamacare’s
financial bait. They are using the concept to frighten physicians and buying
local medical practices.

Hospital systems’ goal is to get a geographic monopoly then take
advantage of the negotiating monopoly. Physician groups especially specialty
groups will stay independent of hospital systems, integrate practices and get
in a negotiating reimbursement.

This will increase the cost of medical care. Everyone knows all
healthcare is local. Central control of healthcare is innately flawed. 

This is one of the many defects in Obamacare’s structure.

Obamacare has dismantled the last vestiges of local competition
among physicians for patients.

Now Obamacare will have to deal with the physician and hospital
system cartels it has created.

 The victims in all of this are patients
and the cost of patient care.

The Obama administration’s public service campaign is starting
to sell Obamacare’s virtues to young people through the NFL, NBA and major
league baseball. It is also signing up non suspecting consumers at supermarkets and churches.

Good luck. I think everyone is starting to catch on.

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

Stanley
Feld M.D.,FACP,MACE

The Obama administration refuses to believe that
physicians are not interested in seeing Medicaid patients. The Obama
administration must think that by increasing Medicaid enrollment the number of
physicians willing to see these patients will increase. I believe the Obama
administration is wrong.

A
survey called the Health Tracking Study Physician Survey,
sponsored by the Center for Studying Health System Change, polled more than
4,700 physicians around the country in 2008.

The survey covered many private practice
issues. One question surveyed was about new patients these physicians would
likely accept.

The survey showed that Internists are 8.5 times
more likely to reject all Medicaid patients as opposed to patients with private
insurance.

There is an additional cohort of doctors who
only accept “some” (i.e. reject most) new Medicaid patients.

These numbers might surprise some but they
reflect reality.

 The physicians who accept “all” or “most”
Medicaid patients are a concentrated minority.

This means that if you have Medicaid
insurance coverage it will be very hard to find a physician who will see you.

The administration refuses to believe
that the 32 million new Medicaid patients will have a difficult time finding a
physician.

Most other observers accept the fact that
Medicaid beneficiaries have a tough time finding physicians. The main reason is
due to the fact that Medicaid deeply underpays physicians and hospitals for
their services.

There is also resistance by progressive
thinkers to believe that Medicaid coverage has poor performance outcomes.

In reality Medicaid coverage is bad
insurance coverage.

Scott Gottlieb M.D.’s article in the WSJ in 2011
stated; 

Medicaid Is Worse Than No Coverage at All!

“New
research shows that patients on this government plan fare poorly. The question is
why does the President Obama want to shove one in four Americans into it?"

Dr. Gottlieb’s question is a very good
question.

The Oregon Experiment just published in
the New England Journal of Medicine reached the same conclusion.

“We found no significant effect of Medicaid coverage on the prevalence
or diagnosis of hypertension or high cholesterol levels or on the use of
medication for these conditions. Medicaid coverage significantly increased the
probability of a diagnosis of diabetes and the use of diabetes medication, but
we observed no significant effect on average glycated hemoglobin levels or on
the percentage of participants with levels of 6.5% or higher.”

The was no difference
in “clinical outcomes.”  However, as I
explained on many occasions, in the past there are large defects in measuring
clinical outcomes.

In additional, the
findings in clinical outcome studies are often misinterpreted.

“Medicaid coverage decreased the probability of a positive
screening for depression (−9.15 percentage points; 95% confidence interval,
−16.70 to −1.60; P=0.02), increased the use of many preventive services, and
nearly eliminated catastrophic out-of-pocket medical expenditures.”

The results of
screening for depression in the Oregon Experiment are not statistically
significant. In order to be statistically significant a p value has to be less
that .05.

Ezra Klein of the Washington Post found the
words to publish the results as very positive for Medicaid coverage using the
Oregon Experiment as proof. The article was entitled “Here’s what the Oregon Medicaid
study really said”

Since the media
is the message Ezra Klein used the media to get his biased message out even if
the message is wrong.

He might be
right that Medicaid coverage is important but the Oregon Experiment did not
prove it.

The real
problem with the Oregon Experiment is that the design of the study is
defective. If a study’s design is wrong the conclusions are wrong on both sides
of the argument.

There are
real structural problems with Medicaid coverage in its present form. Its
reimbursement method is also wrong. The only way to provide quality affordable
care to lower income families is to fix Medicaid’s structural defects.

To force 32
million people into a defective system is going to lead to disastrous fiscal
and medical care consequences.

I have to think
the Obama administration does not care about the results or the administration is
blinded by its own ideology.

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

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Stanley Feld M.D.,FACP,MACE

Congress has finally figured out Obamacare’s financial burden to them
personally and their staff. They want out and are trying to sneak in a waiver for
themselves.

Millions of Americans are going to pay more for their healthcare
insurance and get less coverage and a higher deductible cost.

Can ordinary American get the same waiver as government workers?

Actuary consultants
from Oliver Wyman in an article published in the journal of the American
Academy of Actuaries, found that "around six million of the 19
million people with individual health policies are going to have to pay
more—and this even after accounting for the government subsidies offered under
the law."

 "For example, single adults age 21-29 earning
300% to 400% of the federal poverty level will be hit with an increase of 46%
even after premium assistance from tax credits."

The number of people seeking individual healthcare insurance
will be even higher when it becomes clear that employers presently providing
healthcare insurance to employees will drop the coverage and elect to pay the
penalty.

The present estimate is that 65% of employers are either
definitely going to drop healthcare coverage or are seriously considering
dropping coverage.

The
healthcare insurance industry claims the reason for the increases in premiums
is the Obama administration’s regulatory policies for participating in health
insurance exchanges.

 Obamacare's community-rating regulations, which
require insurers to accept everyone but limit or ban them from varying premiums
based on age or health.

1.  The law
   also mandates "essential" benefits that are far more generous than
   those currently offered and thus raise the premiums.
2. The healthcare insurance industry will be
   required to pay a tax on every healthcare insurance policy sold through the
   health insurance exchange. The industry is anticipating the tax and passing it
   on the anticipated cost to the consumer.
3. Employers with over 50 employees are decreasing the
   number of employees to less than 50 employees so as not to pay a penalty for
   not providing insurance.
4. Employers are not required to
   provide insurance for employees working less that 30 hours a week and so
   employers are decreasing employee work hours.

 The Bureau of Labor
Statistics reported on a category of workers who will almost surely be
involuntarily under-employed as a result of health reform.

“The present
estimate is that 10 million part-timers now working 30-34 hours per week will
have their work week decreased to under 30 hours a week.”

According
to Congressional Budget Office projections in July and September 2012, three
million people will lose their insurance altogether in 2014 due to Obamacare.

Six
million will have to pay the individual-mandate tax penalty in 2016 because
they don't want or won't be able to afford coverage, even with the government subsidies.

It is anybody’s guess how many people will be uninsured. The more
uninsured people that are eliminated from the insurance pool the higher the
insurance premium for those insured.

Rather than providing universal affordable care the Obama
administration has created a system that will result in more uninsured consumers and faced with unaffordable costs.

Are all these people going to qualify for Medicaid? I do not believe so.
They will earn too much to qualify for Medicaid and too little money to afford
the upcoming premiums.

It is estimated that 30 to 40 million American families’ will
experience an adverse affect in healthcare coverage as a result of Obamacare.

Americans are becoming concerned as the reality of the negative effects
of Obamacare become clear.

Even the traditional mainstream media is starting to report those
concerns as Obamacare’s negative effects are being felt.

Theoretically Obamacare sounds good. Practically it will collapse
the healthcare system.

“Health and Human Services Secretary Kathleen Sebelius, who told a
gathering a few weeks ago at the Harvard School of Public Health that she has
been "surprised" by the political wrangling caused so far by Obamacare,
there are likely to be plenty of surprises ahead.”

What are the other surprises? What is going to happen to all the
uninsured and underinsured?

It looks like the outcomes are going to be the opposite of the goal of
Obamacare.

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

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