Stanley Feld M.D.,FACP,MACE

President Obama’s Healthcare Summit demonstrated a lack of understanding of the important problems that need to be fixed in the healthcare system.

The critical problem is rising costs. The government cannot afford Medicare or Medicaid in its present form. Corporations cannot afford to provide healthcare insurance for its employees. Individuals cannot afford to buy healthcare insurance.

President Obama’s goal is to “provide? (offer?)” affordable healthcare insurance to all (universal care) and to increase the quality of care. His goals are admirable. His route will fail. He cannot expanded entitlements. He must motivate and increase consumer responsibility for their health and healthcare.

At the onset of his Healthcare Summit he refused to drop the House and Senate bills and start all over again.

I have written several articles outlining why the House and Senate bills are terrible bills. These bills will not solve the healthcare systems problems. They will increase the deficit and decrease access to care for seniors and non seniors. Both seniors and not seniors will experience much greater out of pocket expenses with decreased access to care.

During the Healthcare Reform Summit, President Obama demonstrated his lack of understanding of the Malpractice Reform issue. Howard Dean told us a few months ago the Democrats do not want Tort Reform because they did not want to take on the trial lawyers. Shortly after that Howard Dean disappeared from the national scene.

The evidence for trial lawyers influence appeared in a Washington Examiner editorial on December 21,2009. The Examiner published the following chart.

Senator Dick Durbin of Illinois, formally a plaintiff’s attorney, explained the trial attorneys’ position below.

I have always told my students to beware of the man with one case. His speech was delivered as plaintiff’s attorney.

The value of a life or an injury is priceless. The point is our society cannot afford the present malpractice system’s structure and the structures effect on the healthcare system’s costs and the behavior of the labor force (physicians).

President Obama’s summarized his view on malpractice reform in his concluding remarks at the Healthcare Summit starting at five minutes and fifteen seconds of this clip.

I think President Obama should check his facts.

The only good study estimating cost of the malpractice system that I am aware of is the Massachusetts Medical Society study.

Cost is in Billions Per Year:  Sethi and Aseltine estimated the costs of the tests to be $281 million for the eight specialties surveyed, based on Medicare reimbursements rates in Massachusetts for 2005-2006. In addition, the cost of unnecessary hospital admissions was estimated to be $1.1 billion, for a combined total estimate of nearly $1.4 billion. The authors said the dollar estimates do not include tests and diagnostic procedures ordered by physicians in other specialties, observation admissions to hospitals, specialty referrals and consultations, or unnecessary prescriptions. The eight specialties represented in the survey account for only 46 percent of the physicians in the state.

If you add the additional 54% of Massachusetts physicians the total cost estimate for Massachusetts would be $3.04 billion dollars per year spent on defensive medicine. If you assume Massachusetts is an average state and multiply by the remaining 49 states the estimate for defensive medicine is $149 billion dollars a year.

“Physicians practice defensive medicine because they don’t trust the medical liability system. This survey should provide a strong impetus for legislative, business, and health care industry initiatives promoting fundamental liability reform. Reducing defensive medicine in Massachusetts could dramatically reduce costs and at the same time improve patient safety, access to care, and quality of care.” 

This estimate does not include the cost of the cost litigation, malpractice judgments or the wear and tear on patients and physicians. It does not include the loss of physician practice time.

During the Healthcare Summit the Democrats and Preside
nt Obama quoted the CBO publishing a cost of $24 billion a year spent on malpractice. The CBO reported that it only cost 2% of the total healthcare costs. The CBO’s article was published in January 2004 and uses earlier data. He said that cost was less than 1% of our $2 trillion dollar healthcare system. He feels it is an insignificant cost and should be ignored.

This article only reflected the cost of malpractice judgments. It does not reflect the cost of defensive medicine.

“Savings of that magnitude would not have a significant impact on total health care costs, however. Malpractice costs amounted to an estimated $24 billion in 2002, but that figure represents less than 2 percent of overall health care spending.⁽¹²⁾ Thus, even a reduction of 25 percent to 30 percent in malpractice costs would lower health care costs by only about 0.4 percent to 0.5 percent, and the likely effect on health insurance premiums would be comparably small.⁽¹³⁾ “

This year the CBO report revised its 2008 estimate of defensive medicine from $5.6 billion dollars a year to $54 billion dollars.

“The CBO estimate of tort reform’s potential to reduce the deficit is roughly 10 times greater than what it projected last December (a reduction of $54 billion instead of $5.6 billion). At that time, the agency said that evidence about the extent of defensive medicine — and how tort reform could reduce it — was murky. However, more recent research suggests that "lowering the cost of medical malpractice tends to reduce the use of health care services," according to the latest CBO report.”

It does not seem to be an exact estimate by the CBO by its own admission. Why doesn’t President Obama advocate significant Tort Reform over the next few years and see if it works rather than piddling with pilot studies?

“Although the CBO now believes that tort reform would significantly curb defensive medicine and its cost, the agency’s numbers are still far short of the savings claimed by some advocates for tort reform. For example, a 2007 study by the National Center for Policy Analysis, a conservative think tank, put the annual cost of defensive medicine in 2005 between $100 billion and $178 billion. In contrast, the CBO priced defensive medicine in 2009 at $6.6 billion.”

If the Massachusetts Medical Society and the National Center for Policy Analysis studies are correct the cost of healthcare would be significantly reduced.

Small poorly designed pilot studies will produce variable results and take many years. Evaluating the studies by combining them for meta-analysis will not demonstrate the true impact of tort reform even if it is positive.

President Obama, please understand the real issue involved in Tort Reform and ignore the vested interests.

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

Stanley Feld M.D.,FACP,MACE

I had hoped President Obama wanted to sit down and have an open “bipartisan” discussion with both the Democratic and Republican leadership after his stunning losses in Virginia, Pennsylvania and Massachusetts.

I hoped the meeting would be a breakthrough because the nation desperately needs effective healthcare reform.

The Healthcare Summit was riveting television because live unrehearsed television can reveal much about people and their attitudes.

I did not realize that President Obama was so arrogant and condescending. My impression was he is self confident and mildly cocky. I think those are good traits. Arrogance and condescension are not good traits. Those traits can be harmful when a person wants to influence the public positively. Peggy Noonan summed it up perfectly.

“Mr. Obama will not have helped himself by his manner. The summit highlighted, even showcased, something unappealing and unhelpful there, a tendency to attempt to show dominance and command by patronizing, even subtly bullying, even trimming.

All people in public life have moments like this—most people do, in whatever walk of life—but you’re not supposed to have them when you’re trying to sway minds, reach out and build support.”

Peggy Noonan goes on with a few specific examples.

“The way the meeting was arranged, the president was the teacher, the lecturer. Arrayed before him were the bright if occasionally unruly students.

He was keen to establish that it was his meeting—he decides who speaks next and who should wrap up, he decides what is and is not "a legitimate point."

He was Mr. President, they were John and Lamar. He wielded a shiny pen like an anchorman eager to show depth and ease.

He even said, "There was an imbalance in the opening statements because—I’m the president." Grace shows strength, accommodation shows security. This showed—well, not strength.

When Rep. Eric Cantor attempted to make a sharp point, the president took the camera off him by calling for his aides and conferring with them as Mr. Cantor spoke.”

President Obama said he came to listen but he spoke one third of the time, the Democrats spoke one third of the time and the Republicans the other third. I do not think he was there to listen. He was there to set up his trick play to get his healthcare reform bill passed. He wanted get the American public behind him and pass his healthcare reform bill in the Senate with 51 votes rather than 60 votes.

I think he failed.

I was most impressed by observing President Obama’s lack of interest in the effect of his healthcare reform plan will have on the budget deficit, our economic growth and the increased tax burden those of all income levels.

He kept referring to the CBO’s scoring about budget surpluses. The CBO has said repeatedly that it scores a bill on the assumptions it is given. Those assumptions have been roundly criticized.

President Obama recently proposed his 2011 budget with $1.3 trillion dollar deficit. The budget does not include the $750 billion dollar increase over the next ten years for his healthcare reform.

Many of the reforms will not go into effect for 5 years while the proposed tax increases will go into effect immediately. The plan incorporates a mixture of the many tax increases proposed by the House and Senate, increasing taxes by almost $750 billion over ten years.

The $750 billion dollars does not included the increases in consumer out of pocket expenses and expenses included in other budgets. (The economic recovery act and others).

I do not think the American people are fooled by all the President’s rhetoric anymore.

I assume President Obama’s thinking is raising taxes will raise revenue. In normal times that might be true. However, raising taxes can cause an increase in unemployment and a decrease in revenue.

He should be focused on decreasing the defects in the systems government has created and the defects in the healthcare system. These defects lead to inefficiency and stakeholder abuse which in turn lead to increased budget deficits.

I would refer President Obama to my brother Charlie Feld’s book “The Blind Spot” if he wants to fix the government and the healthcare system. His book outlines how he has helped some corporations decrease its inefficient systems through the use of information technology as an extension of business planning. Information technology should not be an inefficient tool of business operations.

If all of the American public was aware of the various taxes hidden in healthcare reform more than 70% would want the President to scrap the bill and start over. America must reduce escalating healthcare costs. You do not reduce escalating costs by increasing taxes. You do it by fixing what’s broken. Let us discuss the taxes in the Senate and House bills.

a. Medicare Part A is funded by payroll taxes. The payroll tax will be increased beyond the current limit to pay for the new health care entitlement. The Senate bill includes a tax on investment income for Medicare Part A.

b. Higher taxes on dividends, interest and business income increases the cost of capital. It will depress investment. Job creation will decrease. President Obama said our economy needs to create jobs by stimulating investment.

The effect of an increase in Medicare Part A tax on dividends and capital gains will have a devastating effect on retired seniors because their investment income is a major supplement to their pensions and Social Security checks. Raising the Medicare Part A tax on income and capital gains reduces seniors ability to buy goods and services in an economy that is dependent of consumer spending.

One has to wonder why President Obama has not figured this out. The American people have.

c. Raising the taxes on capital income and capital gains will lower asset values. Thirty percent of all stocks are held in retirement savings plans. The seniors that rely on the income from these plans for their livelihood are not rich investors that have been the target of other tax increases.

They are people that spent their working years saving money for their own retirement in mutual funds, 401(k)s, IRAs and other savings vehicles; this would just punish them for a lifetime of careful planning and saving.

A third level of taxes is an excise tax on medical device manufacturers and brand name pharmaceuticals. There will also be a tax on the healthcare insurance industry.

Who do you think these increased costs will be passed down to?

Answer: Consumers.

Will these taxes stimulate jobs formation, create incentives for innovative solutions, reduce total healthcare costs to consumers, and provide high quality healthcare coverage at a lower cost?

No

We get it President Obama. You cannot charm us anymore.

Stanley Feld M.D.,FACP,MACE

Ann Braly’s (CEO of WellPoint), article in the Wall Street Journal on February 7, 2007 and the announcement of a 37% increase in healthcare insurance premiums by California’s Anthem Blue Cross(a WellPoint affiliate) illustrates several points.

1. The healthcare insurance industry wants Obamacare’s mandated insurance so it can service more enrollees.
2. It is easier to hate the healthcare insurance industry more than Obamacare
3. President Obama is able to ride in on his white horse and save Americans from the evil healthcare insurance industry.

Who wins?

1. The healthcare insurance industry.
2. The President and his goal to increase government. control over our lives and freedom.

Who losses? American citizens

1. Increasing government control over one-sixth of our economy

2. Increasing taxes in different ways.

3. Decreasing freedom to choose.

4. Restricting access to care.

5. Rationing medical care.

6. Infringement on our constitutional rights.

The healthcare insurance industry controls the healthcare system. It sets insurance premiums using defective accounting systems to determine an exaggerated overhead.

The States and their State Insurance Board control licenses to sell insurance. State Insurance Boards have not acted in the citizens’ interest in many states.

All the California State Insurance Board has to do is refuse Anthem Blue Cross a license to sell insurance in California. Anthem Blue Cross would lose 800,000 enrollees.

The healthcare insurance industry is the administrative service vendor for Medicare and Medicaid. The fees government pays to the healthcare industry are excessive.

The healthcare industry believes it adds value to medical care of patients.

“The reason costs are rising so fast, Mrs. Braly says, is because the way the health-care market is structured doesn’t give providers reason to control costs. The solution is to "reintroduce the consumer to the health-care equation," and on that front, she believes, insurers "are actually the part of the health-care delivery system that is there to create the value."

This is an important statement. Medical care is the relationship between patients and physicians. All the other stakeholders are secondary stakeholders. In Repairing the Healthcare System the most important issue to be resolved is how do you provide incentives to patients and physicians to control costs?

The solution is that consumers have to drive the healthcare system not healthcare insurance industry.

Government control of the healthcare system will not control costs. Programs that penalize physicians and patients will not control costs.

Patients can control costs and quality with the appropriate educational infrastructure. At present most patients choose their physician by word of mouth.

Healthcare costs can be controlled by consumers controlling their healthcare dollars. .

“Mrs. Braly thinks patients will make more cost-conscious decisions if they have the incentives and the tools—namely, the information about cost and quality that is the basis of any ordinary market. "Data just sitting there is not helpful, and its got to be meaningful, provided to the doctor and the patient in a meaningful way," she says. Far from simply being a bill-paying outfit or a hedge against risk, she sees WellPoint’s fundamental role as making "the health dollar more valuable, less wasteful, more efficient."

Mrs. Braly knows her company owns the healthcare dollar. She wants patients and physicians to be directed by her company to be more efficient. If they are they will be more valuable to her company’s bottom line.

I do not think she will reduce premiums. . I think increased efficiency will result in greater profits for WellPoint. Consumers have to be incentivized to be responsible for their health and healthcare. This is the only way you will reduce costs and decrease premiums. The government trying to force cost reductions will fail.

I do not think President Obama realizes he is being set up by the healthcare insurance industry. He believes he is setting the healthcare insurance industry up.

He has refused the Republican offer for a bipartisan effort at healthcare reform. It is almost as if he and the healthcare insurance industry are playing bad cop, good cop at the expense of the American people.

President Obama published Obamacare 5.0 on Monday four days before his so called bipartisan healthcare summit. His proposal is almost a duplicate of the Senate bill.

Michael Connelly, a retired constitutional lawyer, wrote a dynamite review of President Obama’s proposal which he dubbed Obamacare 5.0.

“After much anticipation, at least by the so-called mainstream media, the White House has released the new and improved version of Obamacare.

Since I have already had to read two previous versions of these monstrosities in the House and two more in the Senate, I call this version Obamacare 5.0 and it is actually an easy read.

It is not hundreds or thousands of pages long and it doesn’t take long for people to realize that it really changes very little.”

The President’s proposal makes the bill more palatable to the American public because he camouflages the implications.

“Some members of Congress have grown increasingly more concerned about the implications that these proposals have for freedom in this country. In that regard the proposal fails miserably.

This is all an attempt to hide the fact that the bill is still blatantly unconstitutional.”

Michael Connelly points out that President Obama’s proposal exceeds the authority granted to Congress in Article 1 Section 8 of the Constitution. It also violates the 9^th and 10^th amendments that protect the rights of people and the states.

His article is clear and precise. The critical details should be a wakeup call to all Americans. It is a must read.

I believe that President Obama’s proposal is in fact a ruse. It is designed to lure us into believing that the health care bill is actually about affordable health care when it is really about taking control of our lives and limiting our freedoms.

It is a cover for the fact that the Senate will try to pass this bill as a “budget reconciliation act” that will only require a simple majority in the Senate instead of the usual 60 votes.

We must act now to let our representatives in the House and Senate know that we are not buying
into these deceptions and that they will pay a price in November at the polls if this is forced on us.

During Nancy Pelosi’s call to action, she said if necessary they would parachute in and pass the bill.

President Obama’s proposal is a way to get a healthcare bill passed. If it passes it will cost Americans dearly. At this point he wants to pass any bill for the sake of saying he passed a healthcare reform bill.

His present proposal is the same as the terrible Senate bill. He will fail because he makes no attempt to be bipartisan.

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

Stanley Feld M.D.,FACP,MACE

Ann Braly’s ( CEO of WellPoint), article in the Wall Street Journal on February 7,2007 signaled an aggressive campaign by the healthcare insurance industry to force the federal government to subsidize healthcare insurance even more than it is presently.

The healthcare insurance industry wants the passage of Obamacare with the deal President Obama made with them. Part of the deal was to mandate insurance and increase deductibles from 20% to 30%.

“This scheme presented by Obamacare would have been, and might still be, imposed on the rest of the country.”

The original scheme (Obamacare1) was forced to be modified because mandating healthcare insurance was challenged as being unconstitutional.

Thirty two states have passed laws prohibiting healthcare insurance mandates. Mandates would be great for the healthcare insurance industry. They would increase the number of customers insured.

The more insured the lower the actuarial risk. The healthcare industry claims it could lower the cost of healthcare insurance. Obamacare 1 would also increase consumers’ deductibles saving more money for the healthcare insurance industry and increasing the burden to consumers.

At the request of several congressmen last year, including some Democrats, WellPoint mined its own actuarial data to model ObamaCare and found that it would as much as triple premiums for the small businesses and individuals who are most of the company’s customers.

WellPoint is declaring that Obamacare 2 will triple premiums. It is important to note that WellPoint did the math using accounting practices permitted by the government. The result is loading the overhead.

There is no evidence that any congressmen or the President has challenged WellPoint’s estimates until Mrs. Braly’s WSJ interview. No one has challenged the accounting methodology. The government is assuming the healthcare insurance industry numbers are correct. It would also be important to understand the math in the actuarial estimates.

The government should be looking at the defects in accounting methods. It should also look at the accuracy of the actuarial calculation.

“The White House political shop promptly compared WellPoint to a tobacco company.

President Obama uses political sound bytes all the time. His sound bytes have little substance. He should become aware of the fact that the average citizen is tired of his nice sounding rhetoric.

The healthcare insurance industry is ripping off the consumer and the government. The government should make the right accounting rules, incentivize the consumer and physicians to decrease the cost of healthcare and get out of the way.

Four days after Mrs. Braly’s statements about premium increases, Anthem, a California subsidiary of WellPoint, announced it was increasing its insurance premium by 39% for individuals insured.

I knew it would not stop at Anthem in California. The healthcare insurance industry is exempt from antitrust laws. I predicted that WellPoint’s argument is paving the way for other healthcare insurance companies to increase its rates.

“For example, Anthem in Maine was denied an 18.5 percent increase last year and is now requesting that state regulators approve a 23 percent rise.

Michigan’s Blue Cross Blue Shield plan requested approval for premium increases of 56 percent in 2009. And in the state of Washington, rates for some individual health plans increased by up to 40 percent until regulators cracked down.

Other states cited in the report were Connecticut, Oregon and Rhode Island.

The premium increases affect the most vulnerable part of the health insurance market, policies marketed individually to customers buying their own plans.”

The goal of WellPoint is to raise the rates on individual plans which have patients at risk for using healthcare insurance. Its position is the government should pay for the risk and that is the deal they made with President Obama before he changed the deal.

“According to the Census Bureau, only about 9 percent of Americans purchase coverage directly, while nearly 60 percent are covered under employer plans. Family premiums for those with workplace coverage rose 5 percent last year, even as inflation fell 1 percent, but nowhere near the rates seen in the individual market.”

The mandate to the healthcare insurance industry is they must accept all employees regardless of pre existing illness in group plans. They can raise the rates of group plans depending on the demographics of the group rather than community rate the group. Community rating should add a community pressure point to individuals that do not take care of their health.

Older self employed individuals cannot qualify for healthcare insurance under present healthcare insurance company rules. Even if they qualify for insurance these consumers have to pay for insurance with after tax dollars. The existing rules decrease individuals’ ability to afford healthcare insurance.

On top of that the insurance industry demands unconscionable premium increases. The solution is for State Insurance Boards to refuse to grant these companies a license to sell insurance in their state.

Another solution should be making healthcare insurance tax exempt just as employer insurance is tax exempt. Obamacare wants to make all insurance payments non tax exempt to increase government revenue while placing a bigger burden on individuals and groups.

The healthcare reform bill should change the rules so that all insurance is community rated and everyone is qualified to buy insurance regardless of preexisting illness. The bill should create ideal medical savings accounts for everyone so they become responsible for their own health and healthcare dollars.

“Insurers say the push for higher premiums reflects supply and demand. Medical costs keep going up, even in a weak economy. Many healthy people are dropping coverage or switching to bare-bones policies to keep their bills down. That leaves a higher proportion of people with health problems in the risk pool, forcing the steep rate increases.”

This is the reason to start from scratch with the Ideal Medical Savings Account. Medical Savings Accounts are an insurance product Democrats refuse to consider. It will decrease the power of the federal government’s ability to keep the citizens in a state of fear and them in power. (Shock Doctrine).

It is time for us to say we are not going to take this anymore.

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

Stanley Feld M.D.,FACP,MACE

Ann Braly, WellPoint’s CEO, launched a new offensive to protect the vested interests of the healthcare insurance industry now that Obamacare seems to be dead.

The healthcare insurance offensive began with her op- ed article in the Wall Street journal on February 7,2010. Readers will have a deeper understanding of the offensive if they follow the underlined historical links in this article.

It will destroy President Obama’s credibility, the practice of medicine, patient access to care and increase the number of uninsured. It will bankrupt the country if her offensive is successful.

The healthcare insurance industry is killing the goose that laid its golden egg.

WellPoint is the largest U.S. commercial health insurer by membership. Wellpoint’s affiliated health plans are in 14 states and insure over 34 million people or 11.1% of the population.

Wellpoint also has reimbursement contracts with 82% of the nation’s primary-care physicians, 84% of specialists, and 94% of hospitals.

Anthem Blue Cross is California’s largest for-profit insurer and is an affiliate of Wellpoint. Anthem insures 800,000 people.

Four days after Ms. Braly’s article blamed all the other stakeholders for the rising cost of healthcare insurance, Antham announced it will raise member premiums by as much as 39% on March 1.

The parent company, Wellpoint had a net profit of $2.7 billion in the last quarter of 2009 alone.

Since the healthcare insurance industry has an antitrust exemption I expect every other healthcare insurance company will raise its premiums. Extrapolating the profit to the entire population insured, the total net profit in the healthcare insurance industry would be 144 billion dollars. This does not include the inflated and wasted administrative expenses.

Somewhere between 35-65 cents of every healthcare dollar goes to administrative expenses. Assume that 50 cents of every healthcare dollar is expenses plus net profit to the healthcare insurance industry. The healthcare system consumes $2.5 trillion dollars. That means $1.25 trillion dollars goes toward expenses and profit. The profit is distributed to employees and stock holders.

President Obama says;

"I mean, to be fair, the status quo is working for the insurance industry, but it’s not working for the American people," Mr. Obama said recently.”

Ann Braly CEO of Wellpoint says;

“It’s hard to see how WellPoint could be to blame for surging health spending, Mrs. Braly says, when 85 cents out of every premium dollar or more "is paid out in the actual cost of care, doctors, hospitals, suppliers, drugs, devices." Confiscating the 2009 profits of the entire insurance industry would pay for two days of U.S. health care.”

The question is who is incorrect? Are Wellpoint’s financial statements incorrect or is Ann Braly’s sound byte incorrect? I think everyone would agree that $2.7 billion dollars net profit in the last quarter of 2009 is not shabby.

Wellpoint is using a well worn public relations technique by pointing a finger at the other stakeholders. All its administrative costs, additional reserves, and investment costs are included in the “85 cents out of every premium dollar figure.”

Wellpoint makes money on the money withheld from physicians for reimbursement. Wellpoint has held back reimbursement to physicians often. When it was sued in California (at an extra cost to the healthcare system) the settlement was for a fraction of the reimbursement owed. The settlement was a pretty good way of making money.

“You don’t need to be an economist to understand that any middleman interposed between seller and buyer raises the price of a given service or product. Some intermediaries justify this by providing benefits, such as salesmanship, advertising or transport. Others offer physical facilities, such as warehouses. A third group, organized crime, utilizes fear and intimidation to muscle its way into the provider-consumer chain, raking in hefty profits and bloating cost, without providing any benefit at all.”

The healthcare insurance industry is the middleman that controls the healthcare system. The government through Medicare depends on the healthcare insurance industry to be the third party administrator for Medicare. The healthcare insurance industry sets the prices and the benefits using an unscientific social science called actuarial science.

“The health insurance model is closest to the parasitic relationship imposed by the Mafia. Insurance companies provide nothing other than an ambiguous, shifty notion of "protection."

In order to control the healthcare system the healthcare insurance industry has managed to control the process of authorized treatment and reimbursement for the government and private insurance.

Mrs. Braly says;

“To actually be fair, the insurance industry was a cheerleader for the plan, at least until the policy substance congealed sometime in September.”

"Obviously, we’ve been involved in this discussion for a while—more than a year—and if you think about it we came to the table early, early on and said we’re going to be advocates for responsible, sustainable health-care reform done right. We really do have to get at the underlying question of health-care costs."

It is certainly to Wellpoint’s and Mrs. Braly’s advantage to have universal healthcare that is mandated and subsided by the government. Prior to September the healthcare insurance industry had it all set up with President Obama.

Universal healthcare would provide more customers and more premiums. The healthcare insurance industry also worked out a deal with the government to increase the deductibles from 20% to 30% so they could provide affordable healthcare insurance at a lower price.

The $2.7 billion dollars in profit for the last quarter drove me to look at the salaries and stock options posted on the web for officers of Wellpoint. Mrs. Braly’s salary was not available.

CEO, Divisional/Presidents’ salary was 1.18 million and 8.4 million dollars a year.

The CEO and Chairman of the Board made 23.9 milliona year .

Executive VP/CFOs’ made 8.42 million dollars a year.

Geographical CEO/Geographical President/Executive VPs’ made between 15.56- 6.39 per year

The stock options awarded are even higher.

In a March 2007 post I stated that “ UnitedHealthcare claims that costs are out of control. Why? Who paid their CEO $1.8 billion dollars over 8 years? The amount equals $300 million dollars a year or $821,917 a day in salary and benefits to one person. < a href="http://stanleyfeldmdmace.typepad.com/repairing_the_healthcare_/2006/11/administrative_.html">What are the other top executives at UnitedHealthcare receiving in salary and benefits? Do you think these salaries affect the cost of insurance?”

Consumers only realize that health insurance increases yearly. In November 2006 I wrote;

“No leader has the courage to step forward and do something about it. I have emphasized much of the leadership can be exerted at the state level by state boards that license the insurance industry, hospitals and physicians. No one has organized the people to protest. The excuse is that the healthcare system cannot be fixed. It is impossible to control physicians. I believe all these excuses are smoke to cloud the solution. The facilitator stakeholders are simply holding on to what they falsely perceive is their vested interest.
“A theory of limits applies here. In a voluntary market, healthcare purchasers–employers or taxpayers–will tolerate only so much cost growth. Then they’ll recede. It is preposterous to believe the well won’t run dry.”

All of these pricing mismatches and excess non medical value added costs can be eliminated by permitting patients to be in control of their healthcare dollar and selling pure insurance that is fairly priced. The Ideal Medical Savings Account system represents pure insurance in the form of high deductible health insurance and motivation for the patient to become an informed consumer.

The cost of processing claims could be eliminated completely. The service claims could be adjudicated instantly with a credit card. Thousands of diverse businesses adjudicate claims on purchases instantly daily at a low cost. The use of credit cards to pay for Medical Savings Accounts could provide an instant savings of $150 billion dollars in costs in the healthcare system. The losers will be the non competitive insurance companies. The winner will be the bright flexible company that puts the correct 21st century system in place.

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

Stanley Feld M.D.,FACP, MACE

President Obama’s healthcare reform bill is not about healthcare. It is about government having control of our freedom of choice, mandating behavior, decreasing healthcare coverage, increasing out of pocket insurance expenses, decreasing Medicare and Medicaid entitlement benefits and squelching innovation in America.

His goal is to decrease the growth of the entitlement programs. Medicare and Medicaid are both out of control . Both programs at the current trajectory of growth will consume over 100% of America’s GNP in 40 years.

In 1965 the government as intervenor set up Medicare and Medicaid incorrectly. The unintended consequences led to more government intervention over the years. Rather than fixing the problems for the long term, the government instituted short term fixes. These short terms fixes have made the programs’ sustainability worse.

President Obama’s healthcare reform bill will not fix the problem. He is trying to “fake us out” in order to control government expenses. He should be Repairing the Healthcare System creatively.

President Obama believes increasing government control over our lives by increasing bureaucratic agencies and farming out enforcement will relieve the government of the entitlement expense. He is wrong. It will increase the government deficit as Medicare Advantage has recently demonstrated.

Seth Godin had a wonderful little blog the other day. He wrote;

The relentless search for "tell me what to do"

If you’ve ever hired or managed or taught, you know the feeling.

People are just begging to be told what to do. There are a lot of reasons for this, but I think the biggest one is: "If you tell me what to do, the responsibility for the outcome is yours, not mine. I’m safe."

When asked, resist.

Today the majority of Americans are not asking for the government to tell them what to do.

On July 5, 2009, I published an article entitled “Did Your Representative Read The House Of Representative Healthcare Bill HR 3200.”

A reader of my blog sent me a summary of HR 3200 written by Larry Schweikart. Mr. Schweikart is contributing editor of FamilySecurityMatters.org , the author o 48 Liberal Lies About American History: (That You Probably Learned in School) and A Patriot’s History of the United States: From Columbus’s Great Discovery to the War on Terror.   He blogs at patriotshistoryusa.blogspot.com. Mr.Schweikart’s analysis is about 80% accurate by my reading.

There has been a lot of noise in the traditional media about the meaning of President Obama’s healthcare reform bill during the last 7 months. The actual text in the bill has been ignored. The text reveals the consequences we can expect from the healthcare reform bill.

President Obama keeps telling us, as he did in his State of the Union address, (start at minute 4 of the You Tube segment) healthcare reform is for the financial protection and healthcare security of Americans.

I have pointed out reasons this is not true in the series of blogs entitled “The House and Senate Bills are terrible Bills.

I have also pointed out the tricks the administrations and the Democratic congress have played on the American people to ram this bill through congress. Last week Nancy Pelosi said “we will have a healthcare bill even if the gate is closed. We will climb the fence. If we cannot we will go under the fence or if necessary parachute in. “

A reader just sent me a you tube interpretation of the bill for those who like to watch it on television. It seems to me to be more graphic and have more impact than the presentation in written form.

We should take a fresh look at the bill’s text and its meaning line by line. Please download the entire bill to check the You Tubes allegations.

The obvious questions are;

1. Who can we trust?
2. Is the actual wording in the bill consistent with what President Obama is telling us?
3. What are the potential unintended consequences?
4. What is the true intent of President Obama’s healthcare reform bill?
5. Does the bill fix the systemic problem in healthcare delivery system?
6. Do you think it will save America and Americans money?
7. Will President Obama’s healthcare reform bill protect our freedoms?

Our country needs healthcare reform badly. President Obama’s healthcare reform bill is not the route to take.

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

Stanley Feld M.D.,FACP,MACE

I am a big fan of Peter Senge’s “The Fifth Disciple”. President Obama’s healthcare reform bill is not solving the underlying systemic problems in the healthcare system. It may bring him fame and glory in the short term. It will be a financial disaster in the long term as many entitlement programs have been.

Peter Senge’s wrote (page 61);

“ The long term, most insidious consequence of applying non-systemic solutions is increase need for more and more of the solution.

This is why ill-conceived government interventions are not just ineffective, they are “addictive” in the sense of fostering increased dependency and lessened abilities of local people to solve their own problems.

The phenomenon of short term improvement leading to long term dependency is so common, it has its own mane among systems thinkers- it’s called “Shifting the Burden to the Intervenor.”

The intervenor may be federal assistance to cities, food relief agencies, or welfare program.

All “help” a host system, only to leave the system fundamentally weaker than before and more in need of further help.

Please consider Peter Senge’s concept as it relates to President Obama’s healthcare reform bill. His bill ignores or proposes the wrong solutions to the five most important systemic dysfunctions in the healthcare system.

The five most important systemic dysfunctions are:

1. Excessive defensive testing.

Effective malpractice reform would correct this problem

The partial cost of defensive medicine extrapolating the Massachusetts Medical Society survey is at least $75 billion dollars a year. If extrapolated to all medical specialties the cost is in the range of $300 billion dollars a year. The cost excludes time wasted and the stress to both the physicians and patients.

1. Healthcare insurance industry’s abuse of the system.

Real healthcare insurance reform is needed as described previously. The ideal medical savings accounts, as opposed to health savings accounts or the present healthcare insurance product would eliminate bureaucratic ineffiency and put consumers in control of their healthcare dollars.

Patients must be incentivized to conserve their healthcare dollars and be responsible for maintaining their own health and well being

1. Administrative services accounting abuse.

The elimination of the abuse and waste by the healthcare insurance industry is necessary. This can be achieved by effective accounting regulation reform for reporting Medical Loss ratios. The Medical Loss ratio accounting abuse adds little value to patient care.

At the same time the regulations for the healthcare insurance industry exemption from antitrust laws should be eliminated.

1. A lack of efficiency in the physicians’ offices.

The elimination of administrative waste and paper work in physicians’ offices by creating a completely functional and effective electronic medical record in the “cloud” is needed.

The installation, updating and use of the ideal electronic medical record should be simple, customizable and inexpensive. The electronic medical record should t fit the physician’s work flow. Physicians should be charged by the click.

Physicians should not be expected to make large capital expenditures for electronic medical record systems that might not be totally functional and then be financially responsible for upgrading to improve functionality.

President Obama’s proposed system for implementing the electronic medical record will only delay adoption and functionality needed to reduce the cost of healthcare.

1. A lack of chronic disease self-management tools.

Systematic educational programs for patient self care and management of chronic diseases must be developed for all physicians. These chronic diseases include diabetes mellitus, chronic lung disease, asthma, hypertension, coronary artery disease, certain gastrointestinal diseases, osteoporosis, and arthritis.

Internet information sources can be constructed within physicians’ ideal electronic medical record. The information sources can be customized to the physicians’ office to educate patients. It must be constructed as an extension of a physician’s care. All of the instructional information is presently on the web. The trick is for physicians to pick appropriate sites with information that will be an extension of the physician’s care. Physicians have to have incentive to do this easily.

Along with cancer the complications of these chronic diseases consume 80% of the healthcare dollars paid to hospitals and physicians. The complications of these chronic diseases can be decreased by 50% is systems of self-management are developed. If the costly complications of these chronic diseases decrease healthcare spending can decrease by at least 50%.

If healthcare reform concentrated on these five areas, with a minimum increase in governmental bureaucratic agencies, America would be well on the way to placing control of the healthcare system in consumers’ hands. Consumers would have the incentives and freedom to choose. Consumer driven healthcare would force hospitals and physicians to either shape up or perish.

Government should make the rules, then get out of the way. Consumers must be empowered choose and be responsible for their own care. Consumers will drive the medical costs down.

Consumers have shown, in many areas of our economy, that they have the power to make efficient and wise decisions. We have only to look at the auto industry, the supermarket industry, the telecommunication industry, and the airline industry to realize that consumers are not dumb.

The government can make effective rules for the healthcare industry and let the consumer drive the healthcare system.

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

Stanley Feld M.D.,FACP,MACE

The Democrats having no clear path going forward on major healthcare legislation. They have put healthcare reform on hold.

They should shred and burn the present healthcare reform bill. It will not Repair the Healthcare System.

The traditional media has published quotes from elected officials. These quotes make it clear that elected officials really do not understand the problems in the healthcare system much less repair them. All the Democrats want is to pass a bill. They think passing a bill will save President Obama’s presidency.

Many Democrats up for election are starting to face reality. The American people want healthcare reform. They do not want this healthcare reform bill. The process the Democrats and the President have used to advance the healthcare reform bill has only made the public more cynical and suspicious of the President and the Democrats in congress.

Democrats up for election are afraid of the same backlash seen in Massachusetts, New Jersey and Virginia. They are backing off President Obama’s healthcare reform bill.

The President has not backed off his healthcare reform plan. He is willing to bring the entire Democratic Party down in the 2010 election because of his convictions. He does not want to understand that his healthcare reform plan makes no sense. His statement during the State of the Union address is riddled with half truths. It’s plan will not serve the interest of the American people. It will increase government control of citizens’ lives, increase the deficit and increase the profits of special interests.

“The Senate majority leader, Harry Reid, Democrat of Nevada, deflected questions about health care. “We’re not on health care now,” Mr. Reid said. “We’ve talked a lot about it in the past.”

He added, “There is no rush,” and noted that Congress still had most of this year to work on the health bills passed in 2009 by the Senate and the House.”

Nancy Pelosi wants President Obama’s bill passed. She does not have enough Democratic votes in congress. She is mapping out a way to complete a health care overhaul in coming months. It looks as if the Democratic leadership and the President want to sneak the bill over, under, or through the fence using procedural tricks.

It is just what the public does not want. Public opinion could not be clearer.

“At the same time, two centrist Democrats who are up for re-election this year, Senators Blanche Lincoln of Arkansas and Evan Bayh of Indiana, said they would resist efforts to muscle through a health care bill using a parliamentary tactic called budget reconciliation, which seemed to be the easiest way to advance the measure.”

Recently, President Obama has said that he would support that approach.

Representative S. Hoyer added, “I think by next week we need to come to focus on the way we want to move forward.”

“Frankly, we’re trying to figure out what is possible,” Mr. Hoyer said.

Mr. Hoyer does not know what to do.

Representative Charles B. Rangel, Democrat of New York and chairman of the Ways and Means Committee, said, “We are not passing the Senate bill period.”

I think it is pretty clear Mr. Rangel does not want to swallow a healthcare reform bill he does not support.

“Senator Joseph I. Lieberman, independent of Connecticut, urged caution, saying, “The White House and Democratic leaders should reach out one more time to Republicans to see if they can find a common ground.”

Reaching out must be done in a honest and sincere way, My way or the highway will not work. The President has to formulate a bill that is bipartisan and directed to serving the interest of the people. His healthcare reform bill does not do that.

Senator Dianne Feinstein, Democrat of California, said Democrats were assessing their options on health care. “It’s a timeout,” she said. “The leadership is re-evaluating. They asked us to keep our powder dry.”

Ms. Lincoln, who faces one of the toughest re-election bids among Democrats, said, “I am opposed to and will fight against any attempts to push through changes to the Senate health insurance reform legislation by using budget reconciliation tactics that would allow the Senate to pass a package of changes to our original bill with 51 votes.”

Ms. Lincoln is co
rrect. The people are tired of closed door tricks. President Obama promised us transparency and bipartisan debate during his presidential campaign..

Mr. Bayh said, “It would destroy the opportunity, if there is one, for any bipartisan cooperation the rest of this year on anything else.”

It will also destroy Mr. Bayh’s chances of getting reelected.

The Senate Republican leader, Mitch McConnell of Kentucky, said White House comments on health care suggested Mr. Obama was not listening to the American people.

What do I think? I think the bill should to shredded and burned. It is a terrible bill for all the reasons I have outlined.

The government is broke. It is spending over 1 trillion dollar more a year than its revenue. Adding another entitlement program makes no sense no matter how well President Obama presents the case. His case is hollow. He has intensified cynicism and mistrust.

Congress and the President must take a hard look at where the healthcare dollars are being wasted. They then have to fix the inefficiencies in a constructive way.

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