Stanley Feld M.D., FACP, MACE

John McCain’s healthcare plan goes on to have “specific” proposals. His specifics are in reality generalities. He does not describing a plan to execute any of his “specific” proposals.I believe the American people deserve more than John McCain is offering.

“A Specific Plan of Action: Lowering Health Care Costs”

“John McCain Proposes A Number Of Initiatives That Can Lower Health Care Costs. If we act today, we can lower health care costs for families through common-sense initiatives.”

How can we lower healthcare costs if we act today with common sense initiatives ?

“Within a decade, health spending will comprise twenty percent of our economy. This is taking an increasing toll on America’s families and small businesses. Even Senators Clinton and Obama recognize the pressure skyrocketing health costs place on small business when they exempt small businesses from their employer mandate plans.”

Amer ica is being bankrupted by many dysfunctional policies. Medicare alone will cost 100 trillion dollars a year in 60 years. It is essential that politicians understand the basic problems with the healthcare system before making specific proposals without having a mechanism for executing the proposals. One basic problem with the healthcare system is the healthcare industry’s control of the healthcare dollar. John McCain plans to keep the healthcare insurance industry in control of the money. He should give patients control of their healthcare dollar.

CHEAPER DRUGS:

“Lowering Drug Prices. John McCain will look to bring greater competition to our drug markets through safe re-importation of drugs and faster introduction of generic drugs.”

Did anyone ever consider why brand name drugs cost less in Canada than in the United States? It is because the Canadian government can not and will not pay a higher price. The pharmaceutical companies want Canada’s drug market. They simply cost shift the difference for the same drug to the United States market. If the Food and Drug Administration is doing its duty correctly generic drugs should be no different that brand name drugs.

Drug patents protect the pharmaceutical companies’ return on investment. When the patent expires the drug can be sold generically. In order to maintain a return on investment the pharmaceutical industry needs to discourage patients and physicians from using generic drugs and re-importing brand name drugs. At the same time the government wants the pharmaceutical industry to have incentives to produce new drugs.

There is clearly a conflict of interests that is not resolved. It will not be easy for John McCain to fulfill the statement to lower drug prices without a program to lower prices that is fair to all. How is he going to do this? Is he going to create another entitlement program for drugs? It is easy to make a promise. It is hard to fulfill poorly thought out promises.

CHRONIC DISEASE:

“Providing Quality, Cheaper Care For Chronic Disease. Chronic conditions account for three-quarters of the nation’s annual health care bill. By emphasizing prevention, early intervention, healthy habits, new treatment models, new public health infrastructure and the use of information technology, we can reduce health care costs. We should dedicate more federal research to caring and curing chronic disease.”

What programs are going to be created for “prevention, early intervention, healthy habits, new treatment model, ect”. Is his government going to reward physicians and patients for preventing the complications of chronic diseases? How is he going to encourage cognitive physicians to create infrastructure to practice chronic disease management? Decreasing reimbursement for cognitive physicians will not encourage chronic disease management.  So far there has been little or no payment for prevention of the complications of chronic disease.

How is he going to fight the war on obesity? Is he going to penalize baseball teams that sell baseball tickets offering all you can eat? Is he going to restrict restaurants from serving larger portions in order to raise prices and attract customers as well? Is he going to reward patients for healthy lifestyle changes? John McCain has to present solutions and not sound bites? He has no solutions.

COORDINATED CARE:

Promoting Coordinated Care. Coordinated care – with providers collaborating to produce the best health care – offers better outcomes at lower cost. We should pay a single bill for high-quality disease care which will make every single provider accountable and responsive to the patients’ needs.

This is a good idea. How is he going to do this? Does he mean making the patient the center of the team and the team an extension of the physicians care? Does he mean making the patients the professor of their chronic disease and equally responsible for the outcome as the physician and his chronic disease team? 

GREATER ACCESS AND CONVENIENCE:

Expanding Access To Health Care. Families place a high value on quickly getting simple care. Government should promote greater access through walk-in clinics in retail outlets.

This is a bad idea. One the one hand John McCain calls for co-coordinated care and on the other hand he promotes fragmented care. Disease management and effective medical care work when there is a strong physician-patient relationship. The team approach can promote the physician-patient relationship if the team is an extension of the physician’s care. The government should train or retrain physicians’ practices to provide greater access to quick simple care rather than encourage a new entity in the healthcare industry that could potentially abuse and overcharge the healthcare system. Uncoordinated home healthcare and nursing home care absorb a large portion of the healthcare dollar. If the care was coordinated it could add value to the medical care system. 

John McCain’s  healthcare plan outlines specific proposals. He does not offer specific solutions for his proposals. His proposals also highlight his lack of understanding of the healthcare system’s basic problems.   

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

Stanley Feld M.D.,FACP,MACE

John McCain’s healthcare plan is not a healthcare plan. It would not put “Patients First”. His plan is designed to avoid further entitlement programs and to relieve employers of the obligation of providing healthcare insurance for their employees. The sound bites and slogans imply healthcare will be provided to all. His remarks have no substance. They are simply generalities. They do not deal with the basic problems in the healthcare system.

“John McCain Will Encourage And Expand The Benefits Of Health Savings Accounts (HSAs) For Families. When families are informed about medical choices, they are more capable of making their own decisions and often decide against unnecessary options. Health Savings Accounts take an important step in the direction of putting families in charge of what they pay for.”

What does “encourage and expand Health Savings Accounts” mean? There is no discussion of who is going to pay for the HSA’s. My view is Health Savings Accounts do not provide incentives for patients to be responsible for themselves. The healthcare insurance industry controls the money and the co-pays. It uses the money for its own investments. Patients can use the remaining money not spent for future healthcare need rather than owning the funds they do not use in a retirement plan. It is simply a delayed payment to the healthcare insurance company. With a high deductible there should be first dollar coverage after $6,000 is spent.

“ Specific Plan of Action: Ensuring Care for Higher Risk Patients”

“Plan Cares For The Traditionally Uninsurable. John McCain understands that those without prior group coverage and those with pre-existing conditions have the most difficulty on the individual market, and we need to make sure they get the high-quality coverage they need.”

He does not propose how he is going to provide “high-quality coverage” to the uninsurable. What does “high quality coverage” mean? There is a large gap between where patients can be comfortable with healthcare coverage and patients’ anxiety about inadequate healthcare coverage. Inadequate healthcare insurance overage (under insured) is usually discovered after the fact.

“As President, John McCain will work with governors to develop a best practice model that states can follow – a Guaranteed Access Plan or GAP – that would reflect the best experience of the states to ensure these patients have access to health coverage. One approach would establish a nonprofit corporation that would contract with insurers to cover patients who have been denied insurance and could join with other state plans to enlarge pools and lower overhead costs. There would be reasonable limits on premiums, and assistance would be available for Americans below a certain income level.”

John McCain should know that states already have high risk pools. The high risk pools have been unsuccessful. Patients with pre-existing illness are overcharged and underinsured by the healthcare insurance industry. The providers of the healthcare insurance are the healthcare insurance companies and not the states. The healthcare insurance industry is not in business to lose money. It sets the high risk premiums at high unaffordable rates. The criteria used to determine rates are not transparent. The only thing transparent about the healthcare insurance industry is its exorbitant profits from high premiums while it restricts patients access to care.

“John McCain Will Promote Proper Incentives. John McCain will work with Congress, the governors, and industry to make sure this approach is funded adequately and has the right incentives to reduce costs such as disease management, individual case management, and health and wellness programs.”

To who are the incentives directed? John McCain’s incentives subsidize the healthcare insurance industry. He is not providing incentives to patients to promote wellness.

 
With a basic philosophy of decreasing government entitlements (privatizing Social Security and Medicare) and relieving employers of the burden of providing healthcare insurance, John McCain is not a patient advocate.

George W. Bush beat John McCain in the 2000 primaries because George W. Bush projected a greater grasp of America’s problems and a more compassionate personality. Unfortunately, neither perception of George W. Bush turned out to be correct. John McCain’s healthcare plan offers neither perception. I can not understand how anyone who sees the difficulty Americans are having in healthcare system could think John McCain’s healthcare plan would solve our healthcare problems.

John McCain should focus on patients, not the secondary stakeholders.

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

Stanley Feld M.D., FACP, MACE

John McCain does not have a healthcare plan to improve the healthcare system. His goal is to eliminate the healthcare entitlement provided by the government for seniors and Corporate America for its employees.

In my view he is not focused on the basic problems with the healthcare system. John McCain is going to leave the control of the healthcare system in the hands of the healthcare insurance industry. He is not going to empower patients to drive the healthcare system by providing appropriate information, education and incentives.

John McCain’s healthcare plan is worse than Barack Obama’s because it is simplistic thinking. He makes the appropriate pronouncements as slogans. However, he simply strengthens the hand of Corporate America and the healthcare insurance industry to the disadvantage of present and future patients. In a search of his healthcare plan for improvement in the healthcare system none exists.

His healthcare plan starts with:

 “A Call to Action”

“John McCain believes we can and must provide access to health care for every American. He has proposed a comprehensive vision for achieving that. For too long, our nation’s leaders have talked about reforming health care. Now is the time to act.”

He is saying nothing but the obvious. One can assume he is for universal healthcare when he says “we can and must provide access to health care for every American.” It is important to review his actual words. One then realizes the words lack substance or strategy.

“Americans Are Worried About Health Care Costs. The problems with health care are well known: it is too expensive and 47 million people living in the United States lack health insurance.”

John McCain does not list the problems with the healthcare system. He declares that they are well known. He avoids stating the basic problems or the reasons for the basic problems. Why is it too expensive? Why are so many people uninsured?
John McCain’s Vision for Health Care Reform

“McCain Believes The Key To Health Care Reform Is To Restore Control To The Patients Themselves. We want a system of health care in which everyone can afford and acquire the treatment and preventative care they need. Health care should be available to all and not limited by where you work or how much you make. Families should be in charge of their health care dollars and have more control over care. John McCain Will Reform The Tax Code To Offer More Choices Beyond Employer-Based Health Insurance Coverage. While still having the option of employer-based coverage, every family will receive a direct refundable tax credit – effectively cash – of $2,500 for individuals and $5,000 for families to offset the cost of insurance.

I certainly believe that patients should have control of their healthcare dollar. A tax credit of $2500 for low or middle income individuals is not enough to help pay a $6,000 a year healthcare policy. The $5000 tax credit will not help a low income family pay for a $12,000 healthcare policy. What about people at the poverty level or just above the poverty level? How it a tax credit going to help them? How does this solve the abuses of the healthcare insurance industry? Can Moises with $22,000 income afford a $12,000 a year healthcare policy? The answer is obviously no!

Meanwhile the Republican administration (Bush)is methodically destroying America’s safety net hospitals. The Republican administration is not funding these critically important county hospitals. The lack funding will not result in an increase in these hospitals efficiency. It will leading to a lack of modernization of safety net hospitals and an inability to provide adequate healthcare to the underprivileged and uninsured.

Making Health Insurance Innovative, Portable and Affordable

John McCain Will Reform Health Care Making It Easier For Individuals And Families To Obtain Insurance.

How is he going to make it easier to obtain affordable insurance without government intervention? There is no plan or ideas published in his plan. It is just a slogan without a plan to help the middle class and lower class workers obtain healthcare coverage.

“An important part of his plan is to use competition to improve the quality of health insurance with greater variety to match people’s needs, lower prices, and portability. Families should be able to purchase health insurance nationwide, across state lines.”

I have changed my mind about consumers being able to by insurance across state lines. It would be good to increase competition among insurance companies. It might force them to lower premium prices and make less profit. It would be bad for the patients because patients would not have a mechanism to stop healthcare insurance company’s abuse of the healthcare system.

Each state is responsible for which companies they issue permits to sell healthcare insurance. Theoretically the individual states have control of the quality of healthcare insurance product sold in their state. Many State Insurance Boards have not functioned exactly how they were intended to function. This has lead to healthcare insurance abuse that has been slow to discover. Once discovered the legal process is tedious. Some State Boards have imposed penalties so weak they have not acted as deterrents to further abuse.

We need leadership to make State Insurance Boards stronger and not federal legislation that will make the State Insurance Boards less powerful. The healthcare insurance industry has not proven itself to be benevolent.

“Families will be able to choose the insurance provider that suits them best and the money would be sent directly to the insurance provider. Those obtaining innovative insurance that costs less than the credit can deposit the remainder in expanded Health Savings Accounts.”

If the insurance plans are underinsuring people at high rates now, how is John McCain going to decrease cost of healthcare insurance with this proposal? There is nothing in his healthcare plan to control the healthcare insurance industry’s premium rates.

“John McCain Proposes Making Insurance More Portable. Americans need insurance that follows them from job to job. They want insurance that is still there if they retire early and does not change if they take a few years off to raise the kids.

If there are multiple plans available and a new employer does not provide a healthcare plan as good as the person’s previous healthcare plan that is going to pay for the premium for the previous plan?

There it is! John McCain’s goal is to get the employer out of the healthcare insurance plan provider business. He wants to place the responsibility of paying the premium for healthcare insurance in t
he consumers’ hands. The goal is to protect the employer and not the employee (patients). The goal of John McCain’s non existent healthcare plan is not to put the Patient First but to put Corporate America first.

John McCain should devise a plan that gives employees an incentive to take care of themselves and not an excuse for employers to avoid responsibility for their employees. I believe employees should own the first $6,000 of his healthcare plan and should have first dollar healthcare insurance coverage after that $6,000 is spent. If employees keep the portion of the first $6,000 they do not spend they will have incentive to use their healthcare dollar wisely. John McCain’s non healthcare plan is corporate America friendly and not patient friendly.

 
John McCain does not have a plan to limit the healthcare insurance industry’s profit, increase efficiency or contain abuse of the healthcare system. He might care but he does not get it.

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

Stanley Feld M.D.,FACP,MACE

It is worth spending some more time on the ill conceived bipartisan mandatory universal healthcare plan of former Governor Romney.

As I pointed out, I believe the original bill was well intended. It was supposed to be universal insurance coverage without a single party payer. The market was supposed to self regulate premiums while giving patients choice. The defect in the plan was clear to many. It catered the wrong stakeholders’ vested interests without reforming the healthcare system. One can not expect real improvement by patching the present healthcare system in favor of the healthcare insurance industry. I suspect Governor Romney pushed this plan to gain national visibility in his planned run for the presidency.

Today the Massachusetts legislature started changing the provisions of the original universal coverage bill. The changes represent another complicated mistake that is destined to fail.

“Striving to hold down costs to taxpayers, a state panel yesterday approved a range of changes for next year for the rapidly growing subsidized health insurance program. The changes will probably cut payments to doctors and hospitals, reduce choices for patients, and possibly increase how much patients have to pay.”

Please note who the victims of the payment cuts are; the physicians and the patients. The healthcare insurance industry is challenged by the state to simply reduce their planned increases from 14% to 9-11% next year.

“The goal “is to make this great healthcare reform effort sustainable,” said Leslie Kirwan, secretary of administration and finance and chairwoman of the Commonwealth Health Insurance Connector Authority, which is overseeing the insurance initiative.”

Leslie Kirwan seems to be the purveyor of political babble for the state of Massachusetts as you can read in my previous discussion of the Romney Plan.

“For the subsidized plan, called Commonwealth Care, the authority’s staff has suggested that costs per member could rise as much as 14 percent next year, if there were no changes.”
“The bid specifications will direct the four insurers that administer Commonwealth Care to cut payments to healthcare providers by 3 to 5 percent.”

Without real price transparency by the healthcare insurance companies effective reductions in premiums will not occur. Competition among insurance companies to become more efficient is not stimulated.

All the stakeholders must participate in real price transparency if we are going to have a chance to repair the healthcare system.

“There’s no justification to be paying more than Medicaid rates,” said Patrick Holland, the authority’s chief financial officer.”

Patrick Holland ignores the fact that the federal government is having problems forcing physicians to see Medicaid patients. Medicaid reimbursement is below physicians’ costs. They can not afford to take care of Medicaid patients at the present level of reimbursement and their present level of inefficiency. The reduction in reimbursement below the cost of production of services without incentives will not solve anything. Real healthcare reform along with decrease in healthcare cost will occur when then is a full court press on preventing complications of chronic disease.

Examples of ineffective chronic disease management appear monthly in the medical literature. All stakeholders are to blame. The incentives for chronic disease management do not exist. A most recent example appeared in the December 2007 issue of the Archives of Internal Medicine. The article is entitled “Inadequate Control of Hypertension in US Adults with Cardiovascular Disease Co morbidities in 2003-2004.” Only 49.3% of patients were within 20 mm Hg of the goal of therapy. Only 69% of patients received any treatment. Patient compliance as well as the ineffective practice of evidence medicine is always at the root of the problem. The lack of reimbursement needed for physicians to develop the necessary systems of care is usually the cause of ineffective care.

“In addition, the board voted to eliminate one part of the program that has been the most expensive per member. That program had allowed patients to pay a higher monthly premium in order to incur lower fees each time they sought care. But the option drew the sickest and oldest patients and was twice as expensive for the state as a plan with lower premiums. The approximately 3,500 patients in that plan will have to shift into an option under which they pay more of the cost per visit.”

By shifting the burden of payment to the patients creating higher deductibles for less coverage will result is forcing patients not to buy insurance. They simply can not afford to buy insurance. The state would be making criminals out of sick patients because the Massachusetts law makes it mandatory to have insurance.
The way to avoid this imbalance and problem is with a subsided Ideal Medical Savings Account.

When are politicians going to see the obvious? Constructive change will occur only when the consumer knows what to demand and how to demand it. Consumers will get results when politicians’ political future is threatened. Only then will the politicians refuse to be influenced by corporate vested interest.

Stanley Feld M.D.,FACP,MACE

We are overloaded daily by the media with statistics, percentages and facts on many topics. This is especially true for the healthcare system. The important question is which facts are the important ones. Some findings are statistically significant, others are not. The media does not report the statistical significance of most studies. It simply publishes the conclusions. Conclusions are often conflicting because many studies are poorly designed and not statistically significant.

A large issue of concern today is the number of uninsured people in the United States. The actual number of uninsured and the significance of the number are subject to debate. A key question not addressed is what is the reason people do not have healthcare insurance?

The definition of healthcare insurance is “insurance against expenses incurred through illness” Insurance, in law and economics, is a form of risk management primarily used to hedge against the risk of a contingent loss.

The important issue is not the number of people who are uninsured. The issue is why are these people uninsured? It seems silly not have health insurance. No one should be uninsured. This is the definition of universal healthcare insurance. Why people choose not to be insured is an important question. Answering this question would focus us more clearly on the solution to the uninsured. If a person chooses to be uninsured and gets sick he will suffer great economic loss in addition to health loss. Everyone is at risk for medical catastrophes. If a person is does not have health insurance that person is liable to be bankrupted by a medical illness. If one is poor or bankrupted, society (everyone) pays for their medical illness indirectly through taxes.

Some might chose to be uninsured because they do not perceive themselves to be at great risk of illness. The purpose of healthcare insurance should be to protect a person against an expensive illness. Young people might think they are at little risk. They might perceive they do not need health insurance. However, when a young person gets sick they usually have a very expensive illness. This is all the more reason they should choose to be insured. The number of young people uninsured and the reason for the lack of insurance should be studied. The uninsured young need to be educated to appreciate the value of healthcare insurance.

Many people are uninsured because they can not afford adequate healthcare insurance. The cost of health insurance is rising at double digit levels each year. The healthcare insurance industry is making unconscionable profits as premium rise. Is there an opportunity for an insurance company to provide affordable insurance at a reasonable profit? I think there is. I also think that selling insurance to the 47 million uninsured at an affordable price would increase the healthcare insurance industry’s profit, increase competition among the healthcare insurers and lower the premiums.

However the healthcare insurance industry does not want to lose control over pricing of insurance policies. The only way keep control over the healthcare system is to maintain the status quo. It would be ridiculous to let common sense get in the way and potentially endanger profits. The healthcare insurance industry does not seem to understand that they are setting themselves up to kill the goose that laid their golden egg. Hillary Clinton along with the other Democratic candidates is carrying the shotgun. I predict the results will be catastrophic to the delivery of medical care in a regulated healthcare system.

Another important question is how many people not in a group insurance plan are uninsured because the healthcare insurance company declares them uninsurable as individuals?

An example is a 55 year old male with obesity, hypertension, and type 2 diabetes. He is an uninsured self employed consultant. He was laid off nineteen months ago by the information technology company he worked for. His COBRA coverage has expired. COBRA coverage was paid for with after tax dollars. When his employer paid the premium for group insurance it was paid for with pre tax dollars. He tries to buy healthcare insurance. He is declared uninsurable by multiple healthcare insurance companies. What can he do? He makes too much money to go on Medicaid. He is not old enough to be on Medicare. He is stuck and on the uninsured rolls and terrified that he will get sick.

Most states have high risk insurance pools. This is required of the healthcare insurance industry by many states. If they do not participate in the high risk pool they can not get a license to sell insurance in those states. All the insurance companies are combined to pick up the high risk pool insurance. Most states omitted rules to require the pooled high risk insurance premium to be affordable. The insurance company determines the actuarial criteria. The patient applying for the pool must pay with after tax dollars. The barriers to entry are also high. The patient might experience exclusions for the illness that is so important to insure against. For example the complications of diabetes might be excluded in a patient with diabetes. The only way this patient can get adequate health insurance is by being in a large group that provides healthcare insurance to its employees. In the group plans the healthcare insurer is required to take all patients at all risks into the plan.

If the patient is approved for the high risk pool the premium is extremely high. The patient usually can not afford the premium using post tax dollars.

Another example is a 42 year old Hispanic male who has been a US citizen for 12 years. He is a handyman and jack of all trades in rural Texas. He makes a living that barely supports his family of four. He has two children age 3 and 8. He is terrified that his children will get sick. He can not afford healthcare insurance. He is qualified for Medicaid. When each child was born he got Medicaid coverage for each of them. However Medicaid dropped them after one year of coverage. He made an extraordinary number of phone calls in an effort to discover the reason for the discontinuation of the Medicaid insurance. He and his wife are also eligible for Medicaid. However their applications have never been approved or disapproved. He has no time to appear in the Medicaid office from 9-5 because he is working for an hourly wage and needs every dollar to feed his family. The inefficiency of the bureaucracy is exposing this hard working man to the disastrous economic effects of a medical illness, the very issue Medicaid is supposed to protect him from. He and his family is one of the forty seven million uninsured.

Unfortunately, many healthcare experts ignore these issues in calculating the number uninsured. The fact is many of these people have no choice but to be uninsured because of price and exclusions, and other barriers to adequate healthcare insurance.

The solution is obvious. It is either a single party payer system or healthcare insurance reform. I believe a single party payer system will be a disaster. Our present healthcare insurance system is a disaster.

The choice is clear to me. It is going to take” People Power” to force a change in our present healthcare insurance system. The Repair of the Healthcare System has to be directed to consumer driven healthcare.

Stanley Feld M.D.,FACP,MACE

I received several comments in recent weeks highlighting the hardships employers face trying to provide healthcare insurance to their employees. Employers, and individuals who want to buy individual insurance have been deceived by the healthcare insurance industry. Many associations subcontract healthcare insurance companies to provide healthcare insurance for the association membership. However, the healthcare insurance is expensive and deceptively limited. People think they are covered until they get sick and discover they are not.

The simple answer is the ideal medical savings accounts with high deductible insurance available to all after all the conditions for the ideal healthcare systems are met.

The healthcare insurance industry and congress have blocked the ideal medical savings account concept for years. Why has congress been so stubborn? MSAs were introduced by the Golden Rule insurance company at least a decade ago. Congress has been influenced by healthcare insurance industry lobbying to block the concept of individuals owning their healthcare dollar and also receive a pretax dollar tax exemption for buying their own healthcare insurance policy. I also do not believe that many of the members of congress want to understand the power and intelligence of the consumer.

In my naïve younger days, I simply could not understand why congress would be opposed to such a logical plan. It would eliminate 150 billion dollars of administrative waste in the healthcare system. My problem was I was not aware of the excessive influence the healthcare insurance industries lobbying groups have on congress.

Lobbying groups in general wield more influence than the will of the people in the daily activities of government simply because they have more money and are more focused than the individual. Previously, I spent a lot of time on TXU’s desired to pollute Texas even further with “Dirty Coal Plants”
and the subsequent acquisition of TXU by KKR with KKR’s promise to discontinue the pursuit of dirty coal plant permits.

This past week it was published that TXU and KKR spent $17 million dollars just to get its merger passed and work its way toward building dirty coal plants in Texas. Imagine how much the healthcare insurance industry pays lobbyists.

It is a true goliath against a weak and divided foe, namely patients (the consumer). Consumers do not get activated unless they are affected. Only then to they want to do something to solve the problem. The problem is only 20% of consumers are sick at any one time. We do not anticipate that we could be affected any day now.

It took the healthcare insurance industry four years and many millions of dollars to have firms like Cooper Lybrand and Price Waterhouse develop schemes that would counter the potential effectiveness of the Ideal Medical Savings Account. They developed the concept of the Health Savings Account. The HSA kept the premium dollar in the control of the healthcare insurance companies. The healthcare dollar does not belong to the patient. The healthcare insurance industry robbed patients, physicians and hospitals of incentives to be innovative in order to repair the healthcare system by being competitive.

United Healthcare bought the Golden Rule Insurance Company. It immediately destroyed Golden Rule’s medical saving account product. UnitedHealthcare has converted Golden Rule’s MSA to an HSA. I cannot understand why the health policy experts who advocated MSAs are satisfied for the now. Their argument is this is compromise. It is a step in the right direction.

To paraphrase the great German philosopher Fredrick Hegel “An ineffective step in the right direction is worse than no step at all. If the ineffective step fails then you will never created the correct concept.”

I will add, especially if the step in the right direction is a purposeful step in the wrong direction. HSAs are destined to fail, in my view, because they do not put the consumer in charge of his healthcare dollar.

Stanley Feld M.D. FACP.MACE

This blog entry is dedicated to Joseph Goldzieher M.D. one of the giants in Reproductive Endocrinology.

The Women’s Health Initiative is perhaps the most famous example of a study that was released to the press before the data was published in a medical journal. The conclusions of the study changed forever the way peri-menopausal and post menopausal women are treated.

The pre-published press conclusion was that estrogen causes heart disease, breast cancer, stroke and pulmonary embolism. The media announced the WHI’s findings before the medical profession had a chance to study the data.

The conclusions frightened every peri-menopausal and post menopausal woman in this country. Over the years observational data supported the conclusion that estrogen was of great value in treating symptoms associated with the acute menopausal syndrome, namely hot flashes, vaginal dryness, urinary tract irritation, skin changes and emotional instability. Estrogen also seemed to protect against heart disease, osteoporosis, weight gain and promote a general sense of well being. There was no good evidence for or against breast cancer.

This NIH sponsored double blind placebo controlled study (WHI) was performed to develop proof with a level A(double blind placebo controlled) study to test the validity of observational data reports of estrogen effects. The WHI reported results that concluded the opposite effects of estrogen reported by many observational studies. The WHI conclusions were that conjugated estrogen caused breast cancer, heart disease, stroke, and pulmonary embolism. The WHI claimed that conjugated estrogen did protect against osteoporosis. You will recall the media is the message and these were the results the media frenzy reported.

Prior to release of the study results many women were afraid to take estrogen on general principles alone. Many felt that estrogen deficiency was part of the aging process. However, women had a life expectancy of 50 years in the early part of the 20th century. Women today live much longer and observational data suggests healthier, as a result of estrogen therapy.

There are many problems with the WHI study that have not been discussed in the popular press. These problems have not been discussed in the medical literature either. Practicing physicians were confused and enraged by the WHI study results and the manner in which they were presented. Patients taking estrogen were angry at their physicians.

There are many defects in the study from a statistical point of view.

1. Age Distribution: 66.6% of the patients were between 60 and 70 years old. 87% of the patients were 60 to 80 years old. The majority of the patients receiving Hormone Replacement Therapy (HRT) for the first time were at least10 years post-menopausal. This age group population does not represent the usual population for starting HRT. HRT is usually started just prior to the onset of menopause or at menopause (48 years old).

6. The traditional approach to presenting a nominal confidence interval is valid when one outcome is being studied against a placebo. Adjusted confidence intervals must be used when studying multiple outcomes with multiple confounding variables.

The WHI’s conclusions were based on the use nominal confidence intervals. The nominal confidence intervals were significant. However they came close to touching the magic number one (1). All of their published adjusted confidence intervals were non significant because they crossed 1.

Estimated hazard ratios (HRs) (nominal 95% confidence intervals [Nom CIs] and adjusted 95% confidence intervals [Adj CIs ) were as follows:

CHD HR 1.29 Nom CI (1.02-1.63) Adj CI 0.85-1.97
Breast cancer HR 1.26 Nom CI(1.00-1.59) Adj CI 0.83-1.92
Stroke HR 1.41 Nom CI (1.07-1.85) Adj CI 0.86-2.31
PE HR 2.13 Nom CI(1.39-3.25) Adj CI 0.99-4.56

The adjusted confidence intervals were published in the original paper.

Media blitz publicity of the results of the study created a high level of certainty for the results of the study in the public’s mind prior to any peer discussion of the data or the weaknesses in the data. Few physicians were in a position to dispute the statistical weakness of the data. The results the media reported were to change forever the way physicians practice medicine for menopausal women. In my view, the results led to a great disservice to women. The publicity also had a devastating impact on the physician patient relationships and the patient confidence in clinical research.

The estrogen only leg of the study showed no significant difference in breast cancer or heart disease. These results and the facts related to the result was less publicized by the media.

The conclusions of the data should have been that the study results were not related to the combination of conjugated estrogen and progesterone in PremPro or the conjugated estrogen alone in Premarin. Even though estrogen might cause heart disease, pulmonary embolism, stroke, and breast cancer, the Women’s Health Initiative did not have the statistically significant evidence to prove it. Once again media published conclusions disrupted the therapy regime of millions of patients as well as their confidence in their physicians. Once again, physicians contributed to the dysfunction of the healthcare system.

Freedom of the press is vital to our freedom of speech, but manipulation of the media’s tendency to sensationalize issues prior to proper judgment is not helpful.

Stanley Feld M.D.,FACP,MACE

A key question to ask is how the insurance industry determines the price of the insurance coverage. I will discuss this question in detail in the future. A hint is, price is determined by an archaic, non scientific, administrative cost overloaded system. In my opinion many of the disease cost modeling is bogus. Disease burden could be very straightforward, scientific and logical.

All the discussions by health policy experts are not challenging the escalating health insurance cost directly to solve the key question. In my view the only expert who is challenging the present system in a logical and civil way is John Goodman. Until we face the issue we will make little progress in Repairing the Healthcare System. The insurance industry is going to have to face the facts unless it wants a single party payer system with the government being the payer. If they continue to overload premiums and segregate risk, the insurance industry will be reduced to a 3-6% broker at best. Many healthcare insurance companies will go out of business.

The second important issue deals with the escalating hospital costs. No one is demanding that we understand how a hospital services fees relates to the hospital cost of providing those services. The fact is that many of the prices for hospital services are arbitrary and have built in excesses that cannot be proven to be warranted. One cannot get a direct answer from a hospital administrator. In fact the hospital administrator does not know how they arrived at the price. Why? The pricing is buried is so much opacity and hearsay that most times it is impossible to discover the prices’ origin. Looking at the pricing of neighboring hospitals does not help because one hospital copies the other hospital’s prices. What you can find out is if the hospital is making a profit. If the hospital is making a profit the hospital administrator assumes they are charging the right prices. If the profit is minimal or less then last years’ profit then the hospital administrator has to raise the price. This is not a very effective way to manage a business.

If the hospital buys a new piece of equipment or information system it adds it to the price of hospital services even if the equipment or information technology saves it money and reduces its cost.
In order for the healthcare system to work, price shifting has to stop, inflating costs has to stop, and arriving at true cost per service has to be determined. If we are on a single payer system it will not matter what the hospital costs are. It will received a fixed, deeply discounted payment from the government no matter what the costs are. Finally, the hospital systems will be forced to increase its efficiency or perish.

It seems to me, that rather than reducing costs through efficiency and fees, both the insurance companies and the hospital systems are shooting at the goose that has laid their golden eggs. They had better wake up soon.

No one wants a single party payer run by the government with all the bureaucracy and inefficiency that will follow. We see what has happened in countries that have a single party payer. They are all moving back to an insurance model because a single party payer system does not work for their citizens.
The definition of a universal health care system is not necessarily synonymous with a single party payer system. Universal healthcare could mean a guarantee of health insurance coverage at a fair price for all. I think that is what Governor Schwartzenegger and Governor Romney were trying to construct. However, the manipulation of the political process by secondary facilitator stakeholders has contaminated the policy. The secondary facilitator stakeholders, insurance industry and hospital systems do not want to relinquish any control even though their control is not working. These facilitator stakeholders had better get smart soon or they will have nothing to control.

The role of government should be to enact rules and regulations for the benefit of the people it governs. Then, let private enterprise and private innovation be creative and compete for the business of the people. This is the market driven economy that has made the United States great. Sam Walton did it with Wal-Mart and Sam’s. Sears and J.C. Penny have never recovered. Target and Costco came along and are now giving Wal-Mart a run for their money to the advantage of the consumer.

This can happen in healthcare. We can promote the innovative and competitive spirit of America. We better do it before we get into a bigger mess with a single party payer system that will result in less quality care, less access to care, and escalating cost to all of us.

Our Government Knows What to Do. It Just Does Not Do It!

Stanley Feld M.D.,FACP,MACE

Insurance companies are in the business of providing insurance. Insurance is for unforeseen occurrences. It seems pretty sensible to me. However, as the health insurance industry has evolved, coverage is not as straight forward as is should be.

The individual patient buying insurance is not treated as fairly as the group buying insurance coverage. If you have hypertension and work for a large company that provides employee health insurance you are automatically covered in your company’s group health insurance policy. If you hate you job and quit, you would not be able to buy health insurance. The insurance company would deny you insurance coverage because of the hypertension. If you could get insurance hypertension and the complications of hypertension would be excluded from your coverage.

If you as an individual had any preexisting illness, the insurance company would make that illness a cause for denial or exclusion of health insurance coverage for that illness. The preexisting illness is not an exclusion or denial if the person is in an employer group health insurance plan. If you are a young individual with no preexisting illness and a healthy family you could obtain coverage with after tax dollars, while the company group health insurance coverage is pre tax dollars and a deductible expense to the employer.

Some of the exclusions are perverse. They include a history of migraine headaches, gallstones, pelvic inflammatory disease, back pain and back disorders, asthma, allergies, hemorrhoids, varicose veins and even sinusitis.

The reasons for outright denials of individuals seeking health insurance are even more perverse. The illnesses include ulcerative colitis, cirrhosis of the liver, diabetes mellitus, schizophrenia, coronary artery disease, epilepsy, and even obesity. Diseases with the chance for immediate emergency such as AIDS, uncontrolled hypertension, previous stroke and leukemia to name a few, are automatic policy with no questions asked. It is paid for by the employer with pre tax dollars and denials.

All of the illnesses above receive coverage in an employer group is a deductible expense.

If anyone in a family got any one of these diseases there would be no option for the employee to leave his job and become self-employed for fear of not being able to obtain medical insurance. This data is available at the U.S. Office of Technology Assessment. The person with the group insurance from an employer is imprisoned. He can not change jobs.

Insurance companies are in business to make money. They do everything in their power not to lose money by avoiding risk if they can. The government has not closed this loop hole in favor of the insurance industry.

Grace-Marie Turner of the Galen Institute ( an innovative research organization focusing on health and tax policy) found a remarkable op-ed piece written by Dick Armey (R-Texas) and Pete Stark(D-California) in the Washington Post in 1999. Pete Stark is the incoming chairman of the House Ways and Means Health Subcommittee. Dick Armey was house Majority Leader at that time. The title of the article was “The ultimate congressional odd coupe weighs in.”

The two seldom agreed on anything. However the agreed that “Congress should act now to help the 43 million Americans who have no health insurance”. Remember folks the date of the article was June 1999. It seems congress is a little slow. We are have 46.7 million people uninsured.

“For individuals, being uninsured is a problem because too often it means health care forgone, small warning signs ignored and minor illnesses allowed to become costly crises. It’s a problem for families because unpaid medical bills are a leading cause of personal bankruptcy. And it’s a problem for the nation because uncompensated care is an unfair burden on doctors, hospitals and taxpayers.”

“Indeed, today’s tax code discriminates against not only insurance purchased outside the workplace but also lower-paid, part-time and small-business workers. The highly paid CEO gets a more lavish health-care tax break than the waitress earning the minimum wage.”

“Properly designed, such a tax credit could bring about near-universal coverage without new mandates or bureaucracy. It would eliminate barriers the uninsured face in today’s system, enabling them to shop for basic coverage that suits their individual needs and is portable from job to job.”
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To be successful, the credit would need to be sufficiently generous to buy a decent policy; available to those who owe no tax liability; and, to prevent fraud, paid directly to insurers or other entities, not to individuals.”

You notice there is no mention of the need for price transparency and a way to set up competitition between insurance companies to decrease the premium charges.

“ We do want to permit a gradual transition to a world in which individuals are free to obtain the kind of insurance they want, regardless of where it’s purchased.”

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Admittedly, a tax credit can’t help people who are too sick to insure at any price. Although we differ, fairly strongly, about the best way to help such people, we agree a reasonable way can be found to do so, and we’ll keep looking for it. (Rep. Stark would prefer to get insurers to take all customers at a common price, regardless of health status. Rep. Armey would set up “high-risk pools” to subsidize sick people’s coverage in the 22 states that haven’t already done so.)”

Pete Stark is right on the money here although I hardly ever agree with him. The common price, regardless of health status is what group policy holders enjoy and this common price should be a community rated price. Community rated price is the average usage a particular community has and a calculation of the price of insurance on the basis of that community usage in a price transparent environment based on cost of the provider and not charges.

Dick Armey is wrong! High risk pools have not worked. The insurance industry has managed to price the cost of insurance in high risk pools out of the reach of those who need it.

“Too often, when Congress turns to health issues, it ends up applying legislative Band-Aids. It’s time to address underlying causes. The biggest health problem facing the country is the uninsured. The tax code can be used to help them. We urge a bipartisan consensus to do so.”

Even when they know what to do they do not do it. It is up to us to demand that it be done. Congress has not done anything since these two leaders said it must be done in 1999. June,1999 was six and one half years ago. Who do you think blocked it? The facilitator stakeholders block it because their vested interest was threatened. It is our turn.