Stanley Feld M.D.,FACP,MACE

I will conclude analysis of John Edwards’ plan for healthcare even though he has dropped out of the presidential race. His plan represents the goal and direction of the Democratic Party with respect to healthcare reform. It will fail.

John Edwards had experienced the dysfunction of the healthcare system when he was suing physicians and hospitals.

He realized then the healthcare system did not make any sense. He took advantage of it. It still doesn’t make any sense. There are too many perverse incentives.

“Mr. Edwards did not propose a universal coverage plan when he ran for president in 2004, focusing instead on expanding enrollment of children. But a day after the Kerry-Edwards ticket lost, his wife, Elizabeth, was found to have breast cancer, and his family began its first-hand education in the vagaries of the system.”

“I mean, when you get the statements by the providers and the insurance companies about what’s covered and what’s not covered, even for two people who are well versed in the law and experienced with the health care system, it seems completely arbitrary in many cases,” said Mr. Edwards, a lawyer. “It doesn’t make any sense.”

Senator Edwards is correct looking at the system from the patients’ point of view. He ought to look at the system from the physicians’ point of view. The healthcare system makes less sense from the physicians’ point of view. Even though patients complained about their healthcare insurance carrier before 2004 he did not hear them until his family was one of the 20% of the population needing the system at any one time.

“The public nature of Mrs. Edwards’s illness — she announced a recurrence at a news conference last year — drew people with health care horror stories to the Edwards campaign. As health care costs and the number of uninsured continued to rise, Mr. Edwards sensed that people were ready for more radical surgery on the insurance system.”

Something needs to be done about the healthcare insurance system. If Senator Edwards understood how we got to this point he would understand his proposed solutions will not fix anything.

“I concluded that something bolder was needed, that the health care system had become increasingly dysfunctional,” he said. “And my contact with a lot of uninsured Americans, who were not children, made it clear to me that the plan had to be universal, that it had to cover everybody.”

I agree. Healthcare reform plans have to be universal. It should also be clear that absolute control has to be removed from the insurance industry. The control of the healthcare system has to be transferred to the consumers and not the governments.

“Under Mr. Edwards’s proposal, which resembles the plan adopted in Massachusetts in 2006, the government would require individuals to have insurance (illegal immigrants excepted).”

The Massachusetts plan is failing already. There are critical shortcomings of the plan. Thousands of residents are exempted from the insurance requirement because they cannot afford even subsidized premiums. The reason is the healthcare insurance industry has been instrumental is setting the price and protecting its vested interest.

“Mr. Edwards’ proposal would prohibit insurance companies from rejecting high-risk applicants and would restrict their profits and overhead to 15 percent of revenue from premiums.”

This is a good idea. It might motivate the insurance companies to compete with each other and decrease the premium prices. The more people a company insures the more premium dollars it collects. The percentage profit from premium would be decreased but the total amount of revenue would not.

The defect in this idea is it lacks real price transparency with respect to insurance real costs. The healthcare insurance industry could easily load the administrative overhead and keep their profit from premiums below 15%.

“Government subsidies and tax credits would be available to low- and middle-income families that cannot afford insurance. Those below the federal poverty line — currently $21,200 for a family of four — would get free coverage, Mr. Edwards said. Those making less than 250 percent of the poverty level — currently $53,000 — would be heavily subsidized and there would be some financial help for those making up to about $100,000.”

There is no question that the definition of people eligible for subsides should be higher than the antiquated definition of poverty. This subsidy is exactly the increased money the insurance industry wants injected into the present system.

However, the patients must be responsible for their care or else any plan will fail. Consumers have to have ownership of their healthcare dollar and incentive to use it wisely. Nothing in the Democratic Party’s or Edwards’ plan takes incentive into consideration.

“Employers that do not offer medical benefits to their workers would have to contribute 6 percent of their revenues to the regional government pools that would offer Medicare-style plans. Midsize businesses and employers with large numbers of low-wage workers might be asked to pay less, and the smallest businesses would be exempt.’
“

“To pay for those subsidies, which account for much of the estimated $90 billion to $120 billion cost of the plan, Mr. Edwards would rescind President Bush’s income tax cuts for those with incomes above $200,000. Additional revenue would be produced through a broad menu of cost-control measures.”

Punitive measures have never been effective. Just image the resistance of employers and entrepreneurs to mandates that represent tax increases.

Mr. Edward is proposing private sector promotion that will fail. The new Democratic president would then say “Gee shucks”, everything else we have tried has failed. The only thing left is create universal healthcare using a single party payer.”

There you have it. If they succeed in passing this type of reform we have arrived at socialized medicine through the backdoor.

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

Stanley Feld M.D.,FACP,MACE

The obvious goal of the Democratic Party if they win the Presidential election is to institute a socialized medicine system. Not one candidate is talking about an incentive driven healthcare system to increase wellness of Americans and decrease the cost to the healthcare system by preventing the complications of chronic diseases. If we created a hype for creating a consumer driven healthcare system with the ideal medical saving account, America would have a chance at effective healthcare reform.
Senator Edwards’ healthcare plan became clear this week. I believe it will fail.

“In Patrick, S.C. Former Senator John Edwards does not discount the possibility that his health care proposal, which would allow Americans to buy new government insurance packages modeled on Medicare, could evolve into a federalized system like those in Canada and many European countries. And if it does, Mr. Edwards said he would be just fine with that.”

To my surprise, Senator Edwards has revealed the Democratic Party’s goal sooner than I anticipated.

“American health consumers will decide which works best,” Mr. Edwards said “It could continue to be divided. But it could go in one direction or the other, and one of the directions is obviously government or single-payer. And I’m not opposed to that.”

The present Medicare model is failing. The cost and cost overruns are unaffordable for the government. Medicare is increasing premiums annually for the elderly and decreasing their benefits. Medicare is also decreasing the reimbursements to providers annually.

“Each of the three Democratic front-runners has called for government insurance that would be available to an expanded number of consumers, not just the elderly and disabled as is currently the case with Medicare. If the government is able to undercut private insurers on price — by forgoing profit, reducing overhead, and maximizing economies of scale — it theoretically could put the private system out of business. and become the de facto insurer for the nation.”

Medicare claims to have minimal overhead. However, they outsource the administration and adjudication of claims to various healthcare insurance companies. The healthcare insurance industry is their administrative services organization. The healthcare insurance companies bury the administrative fees into the cost of the service to Medicare. The overhead fees do not show up as overhead.

“Republican candidates and policy strategists have raised the specter of “socialized medicine” and depicted the Democratic plans as a back-door route to a so-called single-payer government system.”
“Mr. Edwards brushed off that critique. “There is nothing back-door about it,” he said. “It’s right through the front door. We’re going to let America decide what health care system works for them.”

All I can say to Mr. Edwards and the Democratic Party is, “Look out for Harry and Louise.”

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

Stanley Feld M.D.,FACP,MACE

The following comment is from a physician. He brings up important points.

“Your blog of January 13, 2008, raises my concern for an important and critical factor in you’re repair of the healthcare system proposals:”

I have received many questions concerning my proposals to Repair The Healthcare System. I am grateful for the comments. It means people out there are paying attention and thinking.

“Even if you give the patient the right and responsibility to decide on the way to spend his/her healthcare dollar, that patient is relatively uninformed and most cannot make the important choices about their healthcare because he is uninformed.”

People are smarter that many think. An important element missing from other healthcare reform proposals is providing patients with incentives to make informed choices. A second element is teaching patients how to make informed choices.

Presently the healthcare insurance industry makes the choices for the patient. Unfortunately many of those choices are restricting access to care and driving the patients to lowest cost providers. These choices are made for the healthcare insurance company’s benefit and not the patient.

The healthcare insurance companies make their decisions on price not quality of care. Neither the government nor the healthcare insurance industry has defined quality medical care accurately.

At any one time eighty percent of the people are not sick.The urgency to recognize that the healthcare system has a problem is not on their mind. In recent years as the healthcare system has become so dysfunctional, healthcare insurance so expensive and in many cases unavailable, it is becoming a concern to most people. Additionally, with the growth of information on the internet consumers are becoming more aware of the criteria for diagnosis of many chronic diseases along with the most effective treatment and follow-up. Consumers are starting to make their own judgments about their physicians and the quality of care they receive.

We have seen the growth of demand for diabetes education, and intensive diabetes self management. Intensive diabetes education is important in improving the quality of diabetes care. The methodology to create an effective Diabetes Education program is available.

I believe when patients are responsible for their healthcare dollar and there is a financial reward for effective chronic disease management we will see all the facilitator stakeholders respond by competing for these patients healthcare dollar. The infrastructure will be created to teach everyone to be an informed consumer.

The new web based phenomena of social networking will create social networks for specific chronic diseases. These social networks will stimulate an even greater level of informed patient choices. The patient will be able to distinguish between excellent care and mediocre care.

There are many examples on the internet of information that can help consumers make intelligent choices. Fifteen years ago we depended on travel agents to pick the best hotels in different cities. Today we use www.Trip Advisor.com. We not only receive editorial comment on the hotels but reactions from people who stayed at these hotels. Another simple example is Amazon.com. for book reviews.

“ And whose fault is this? Is it the fault of patients themselves, or physicians and other healthcare professionals, or those who own the healthcare insurance business and our legislators.”

Everyone is at fault! It starts with the patients. They have to be responsible to themselves and their disease. Physicians do not get paid to prevent the complications of disease. In our present system they only get paid to fix things. It is against the vested interest of the hospital to keep the patients out of the hospital. If physicians reduced the incidence of coronary artery disease in diabetes mellitus by 50%, hospitals would be in big trouble. The healthcare insurance industry does not pay adequately for preventive services. If all the stakeholders’ vested interests were align for the patient’s benefit we could decrease the cost of healthcare by at least 50%.

When the healthcare insurance industry or government reimburse for preventive services, the payment is not sufficient to motivate physicians to develop an infrastructure for chronic disease management. When consumers own their healthcare dollar and are motivated to spend their healthcare dollar wisely we will see the development of viable diabetes education centers, asthma centers, and other chronic disease management centers. (Focused Factories)

Effective chronic disease management will not only increase the quality of care, it will also decrease the cost of care by decreasing complications of chronic disease.

And who is going to be able to remedy this?

It is going to have to be the consumer. The mechanism will be the ideal medical savings account with patients being responsible for their healthcare dollar and their healthcare. Hospital systems, healthcare insurance companies and physicians practices will be transformed. It is easy to understand that none of the secondary stakeholders wants to give up its power. The changes involve web based real price transparency, an ideal medical savings account, an insurance industry that continues to negotiate price, accurate definitions of quality medical care for specific diseases and patient web based social networking. It is essential that all of this occur at once.

“One must not only empower that consumer but inform him/her. Please address, in your proposals, the solutions for this deficiency, which must precede all others if a system such as you propose is to work.”

I refer you to my review in the Fall of 2007. The healthcare system must work within a new set of comprehensive rules. We simply can not continue to patch the system.

I believe the consumers is not stupid. If he chooses to take advantage of the system he is in reality taking advantage of himself. The overwhelming majority of patients will make the correct choices. They will utilize technologies of the 21st century to help them spend their healthcare dollar wisely.

Neither the Democrats or the Republicans are close with their proposals to repair the healthcare system.

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

Stanley Feld M.D.,FACP,MACE

Baruch Obama’s healthcare plan seems different than Hillary Clinton’s.The only difference is Hillary Clinton’s plan is a mandate and Omba’s is a choice. Both plans create a public option managed by the government. (Socialized medicine)

“Once Hillary Clinton got roughed up in Iowa, she was bound to strike back against Barack Obama. Her first line of attack debuted at the Democratic debate over the weekend, and a big part of it concerns health care. Their differences are more political than substantive, but the debate does tell us something about current policy ambitions on the American left.”

The term universal healthcare does not have to be synonymous with government as a single party payer. However, to Mrs. Clinton and Mr. Obama they are synonymous.

“Universal” health care is of course a major Democratic issue, and Mr. Obama laid out a proposal in May, Mrs. Clinton in September. Both plans create a public insurance option managed by the government. Both plans impose more stringent regulations on insurance companies, and both institute new taxes on business.”

The Republican Party’s interpretation of these plans is that it represents socialized medicine. The reality is that this is a big step on the way to a totally socialized medicine system. The plans will generate another headache for the federal government. Entitlements are bottomless pits with multiple failures. They will fail to control cost, or increase the quality of medical care. They will fail to improve patient or physician satisfaction. They will increase taxes and cost to business without increasing coverage. They will fail because they lack incentives for consumers and providers.

I predict the inefficiencies in the healthcare systems will increase. adding patches to a broken system does not improve the system.

“The so-call “individual mandate” has become the preferred liberal health policy tool after Mitt Romney introduced it in Massachusetts.”

Romney’s Massachusetts plan has been modified after nine months because of extreme cost overruns.

In theory, such a law would force everyone to sign up for health insurance–either through their employers, a private plan or a government option–or otherwise pay penalties.

Mitt Romney knows the wheels are coming off the Massachusetts Program. You do not hear him talk about it very much except to take credit for the plan. Romney’s plan does not provide incentives for the consumer or the providers.

“ Mr. Obama’s mandate has led to a primary catfight that runs back several months and Mrs. Clinton is pressing the issue especially hard now to attract liberals who think Mr. Obama is the better bet for “change.” She said on Saturday that Mr. Obama “proposed a health-care plan that doesn’t cover everybody.” Mr. Obama counters that the reason many people aren’t insured is because they can’t afford it.”

He has been accused by Clinton of echoing right-wing talking points,” He fires back that he is testing reality.
“In modifying its original plan Massachusetts has exempted almost 20% of uninsured adults who don’t qualify for subsidies from mandated coverage because it is too expensive.”

In Massachusetts more and more people can not afford the mandated healthcare insurance program. The State of Massachusetts cannot afford the rising costs of the plan.

I believe the Democratic Party’s goal is to use incremental steps to gradually achieve a totally government-run health-care system. Hillary Clinton is making a big mistake in highlighting herself as a change agent. She failed with HillaryCare in 1994.

“She’s betting that Democratic primary voters will give her credit for having tried. The new liberal consensus is that her 1994 effort got the policy right but botched the politics. That’s why Mrs. Clinton–and John Edwards–posits insurance and pharmaceutical companies as villains who must be vanquished for liberal reform to prevail.”

Hillary Clinton’s goal is to convert a political liability to a political asset. She wants credit for a failed plan. In 1994 she never asked patients and practicing physicians what they needed or wanted. She is making the same mistake now.

“By contrast, Mr. Obama says a genuine health-care overhaul must be negotiated at a “big table” including industry.”

Whatever the minor policy differences among Democrats, their major domestic ambition this campaign season is the government takeover of the health-care market.

We have heard nothing constructive from Republican candidates. I do not think any of their presidential candidates have a viable plan. No one seems to understand the Consumer Driven Healthcare concept.No one seems to understand the ideal Medical Saving Account concept.

Healthcare is a major issue to the voters. Now is the time “People Power” must express itself.

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

Stanley Feld M.D.,FACP,MACE

None of the candidates are discussing the origins of our dysfunctional healthcare system. If they understood the origin of the dysfunction I believe the cure would be obvious. The problems started with Medicare and mandated price controls.

Instead they fight over relatively insignificant issues.

“ Clinton is not alone among Democrats in calling for all adults to buy insurance. Former Sen. John Edwards of North Carolina, New Mexico Gov. Bill Richardson and Sen. Christopher J. Dodd of Connecticut have included the requirement in their health plans, making Obama the most notable outlier in the party’s presidential field.”

An important question is; what is the definition of the middle class? The Drum Major Institute, a progressive think tank, has a website called www.themiddleclass.org that places the range for middle class at individuals making between $25,000 and $100,000 a year. The middle class comprise 60% of our population. These are the people the presidential candidates are begging to vote for them. However, the candidates from neither party are presenting viable solutions to the voters’ problems.

A middle class male with a family of four earning $40,000 per year will not be able to spend $10,000 a year with after tax dollars for healthcare insurance. He needs to feed and clothe his family. His home could cost $12,000 a year. Fuel, electricity and gasoline could cost at least $8,000, all with after tax dollars. Income tax bill could be at least $6,000 or more. All this without mentioning food and clothing and other essential expenditures to keep a roof over his family’s head.

A male independent contractor with a family of four who has hypertension and high cholesterol earns $50,000 a year. He does not have access to group healthcare insurance. He would not be eligible to purchase healthcare insurance from any healthcare insurance company. He is a poor insurance risk. Even if he was eligible, this middle class family could not afford the present healthcare insurance premiums.

“The idea of making health insurance a requirement has grown in appeal as politicians and health advocates look for ways to cover the estimated 47 million Americans who do not have it.”

On the other hand, insurance executives are earning millions of dollars a year; hospital administrators feel they deserve one million dollar plus salaries. We all recognize the inefficiencies and waste in the system. The presidential candidates are not talking about how to solve these problems.

Pharmaceutical companies sell their drugs directly to the public through advertising. The FDA has recently taken many drugs of the market. How can the public develop trust in medications? Not a single candidate is discussing the patient safety issues of prescription medication.

Neither are any of the candidates discussing ideas to solve our national obesity epidemic. Obesity is the cause of many chronic diseases. Here is an idea for a candidate. Why don’t you make the War on Obesity a national issue. Two issues can be highlighted. First is the excessive calories in fast food and second the perverse incentives in the farm bill. The farm bill incentives can redirect corn and soybean from foodstuffs to fuel. The result would be decreasing our dependence on foreign oil and promoting a cleaner greener environment. Both initiatives would have a significant impact on our health.
Ninety percent of our healthcare dollar is spent on treating the complications of chronic disease. No candidate is advocating funding for teaching patients to prevent these complications.

Compliance/adherence rate for medication prescribed is about 50% for most chronic diseases. No candidate has mentioned developing public service educational programs to emphasize this problem.
These are a few of the problems that should be addressed.

Yet Clinton is attaching Obama with meaningless sound bites. “He’s called his plan ‘universal.’ Then he called it ‘virtually universal.’ But it is not either,” she asserted in a recent Iowa speech. “And when it comes to truth in labeling, it simply flunks the test.”

The debate about healthcare is entertaining but shallow and negative.

“Clinton mailed a letter to Iowa voters, over the signature of former Gov. Tom Vilsack, which says “Mr. Obama threw back talking points worthy of Rudy Giuliani or Mitt Romney” when questioned about “flaws” in his plan.

In response, Obama distributed a piece in New Hampshire that defended his health proposals and urged voters to “remind Hillary Clinton” that the Jan. 8 primary “won’t be won by launching misleading, negative attacks.”

However Americans are tired of political rhetoric. Someone has to tell the candidates that we are smarter than they think.

“But as the concept of a health insurance mandate gains currency within top ranks of the Democratic Party, the feasibility of the idea remains uncertain and its effects are unproven. As the Obama campaign points out, similar requirements in other areas, such as mandatory automobile insurance and motorcycle helmet use, never result in universal compliance.”

I do not believe Hillary Clinton is interested in the feasibility of her ideas. She is more interested in spinning her sound bites so she can become president.

Obama might be the only one that has respect for our intelligence. I hope America’s intelligence shows up in the polls.

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