Stanley Feld M.D.,FACP, MACE

I type ideas into my computer so I do not forget them. I do not know if the following is a quote from someone or something I simply wrote down. I apologize to the person if someone else said it.

A given: Free societies tend naturally toward a “Katrina mentality” of doing nothing until something happens. Have we done anything yet?

September 11 was less ‘a failure of imagination’ than an inability to see that America’s enemies were hiding in plain sight. They still are. Have we done anything yet?

The same mentality applies to developing the Ideal Electronic Health Record (EHR). The answer is in plain sight! The barriers are the vested interests that are benefiting from the present medical infrastructure. It is difficult to be innovative and imaginative when you are experiencing success. Many successful businesses feel anything innovative, imaginative or noble could decrease their present success. It is also difficult to express innovation and imagination in a hierarchical bureaucracy. Therefore “mature” businesses and organization become ossified.

The problem in a free society is you can only become chief of the bureaucracy (most of the time) if you do not use your imagination and do not make waves.

I believe the internet, and blogosphere are going to change all of the ossification of innovation and imagination our society has experienced recently. They are truly democratizing. The internet and blogosphere permit people to think, be imaginative and innovative through the ease of free expression offered by RSS.

The great power of a free society is individual freedom of speech, a free press and freedom of communication. We have lost some of these freedoms in the last 70 years with the development of hierarchical bureaucracy and consolidation of the press.

Robert Scobies’ book Naked Conversations is a must read. The subtitle is “How blogs are changing the way businesses talk with customers.” We are in the midst of a revolution in how we do business. Most of us can not visualize it yet. In general, societies do not understand the paradigm shifts as they are in the process of occurring.

In the development of the ideal EHR the answer is hiding in plain sight. I believe I established the fact that the Electronic Medical Record (EMR) should be broadened to an Electronic Health Record (EHR). I have also established the fact that the Health Savings Account (HSA) should be expanded to a Medical Saving Account (MSA)

In the Repair of the Healthcare System the key question is where does the healthcare system spend most of the money?

1.Eighty to ninety percent of the money is spent on the complications of chronic diseases. We all accumulate chronic disease as we go through life. As I said previously, medical physicians have become very expert at fixing things that are broken. The medical profession has just started to develop systems of care for chronic illnesses in order to prevent complications of chronic diseases. If we have systems of care for the treatment of chronic disease in place, and could execute the practice of evidence based medicine efficiently in a clinical setting, we could reduce the complication rates of diabetes, osteoporosis, asthma, chronic obstructive lung disease, muscular skeletal disorders, hypertension and heart disease by at least 50%. If we were perfect we could probably reduce the complication rate by 80%

The math is simple. Diabetes Mellitus costs the healthcare system in direct cost $150 billion per year. The cost of complications is eighty percent (80%) of $150 billion, or $120 billion per year. A fifty percent reduction in cost means a $60 billion dollar savings to the healthcare system for diabetes. However, the disease management has to be done correctly.

Can a system of disease management be set up to reduce the complication rate of Diabetes Mellitus?

It has been by the American Association of Clinical Endocrinologist for Diabetes Mellitus. Any physician can execute this system of intensive diabetes self management in his office. The most important person in the system of care is the patient. It is a system that teaches the patient intensive diabetes self management. Intensive means the patient is taught how to normalize his or her own blood sugar. A normal blood sugar will avoid the complication of diabetes mellitus. The system of intensive diabetes self management teaches the patients to be the “Professor of Their Disease”.

Patients are responsible for their own care. The physician is the coach that helps fix some errors in patients self management. The care paradigm can be put in an Electronic Health Record (EHR). Both the patient and physician can share all the results including the blood sugar tests the patient does and the lab work the physician does with a web based EHR. If the banking system can do it with online banking, medicine can do it!

The interoperability of the EHR includes a pharmacy history of the patient’s compliance with medications that are ordered. The pharmacy must interact with the patient/physician electronic health record every time a refill is given. The physician can then through the EHR calculate the patient’s compliance with medication.

Compliance is a huge problem. If the patient does not take the medication the medication can not protect against the complications of disease. If the patient is educated (patient education is under compensated or not compensated presently by the insurance industry) and is responsible for their own healthcare dollar with a Medical Savings Account (MSA), the patient will become motivated to demand and will pay for education. It is easy for patients to understand that not only is their health at risk but their own money is also at risk.

An imaginative person in an unimaginative facilitator stakeholder industry can start seeing how this one element (Chronic Disease Management) is the one answer to the run away healthcare costs. The answer is in plain sight. The current information technology expertise is available. The EHR has to be created to add value to the patient/physician interaction for both the economic and quality care benefit of the both primary stakeholders. It is inappropriate and doomed to failure if it is formatted for the secondary stakeholders. It has to be driven by the patient. It has to have interoperability between medical and financial lines. The patient has to be given incentive to drive the system.

I will continue to expand on the ideal EHR.

I will continue to build on the ideal electronic medical record.

Stanley Feld M.D.,FACP,MACE

Physicians have been slow to adopt Electronic Medical Records (EMR) even though most physicians are computer savvy. There are reasons for physicians to be slow adoptors.

They are told that the EMR will increase their quality of care. However, quality of care has not been adequately defined by those who proclaim EMRs’ virtue. Physicians have negative experiences with information technology. The insurance industry and government have used IT against physicians to decrease the fees. Physicians know much of the data collected by the insurance industry and government has been formatted to answer the wrong questions. The potential of the EMR simply stimulates more mistrust and suspicion on the part of the physician against these entities.

Those knowledgeable about EMRs would say “Dr. Feld you have it completely backward.” Perhaps I do. I do not think so. I have expressed the perception of many physicians. Perception translates to the reality of resistance by physicians.

I understand the advantages of a functioning and effective EMR. If done correctly the physicians would flock to adopt the system. However, most demonstrations of EMRs are a disaster. The implementation of EMRs by most EMR companies has been worse. The purchase of an EMR to many physicians has simply been money down the drain. A few practices have been lucky and very successful.

The investment the physician must make is at minimum $50,000 per physician. In an environment of decreasing insurance and Medicare payments, $50,000 is a huge investment. In addition there is usually an annual maintenance fee as well as yearly service fee. Many software companies produce EMRs. Choosing the correct EMR seems impossible to most. Many physicians have been stung by the software company going out of business within two years, making their investment worthless.

In the January 2007 issue of Health Data Management there appeared a Newsline article “Hawaii Blues to Docs: We’ll Help with EMRs.

“A $50 million program from the Hawaii Medical Service Association, under which the Blues plan, would give providers substantial financial help to purchase electronic medical records systems, could wire up most physicians in the state.”

Why would the physicians want to be wired up? What does wired up mean?

“Honolulu-based HSMA also thinks the program will foster the longer-term goal of establishing regional health information organizations.”We’re making this investment to move the community along to wider adoption of I.T. so we can be ready for RHIO activity,” says Cliff Cisco, senior vice president. “There’s a lot of RHIO talk, but we’re a ways off from implementing a network. We want to prepare for that and give motivation.”

One should note that a RHIO is a network of information of all the patients’ charts in a regional and anyone can get patient information and physician care activity instantaneously with proper authorization. This would be great if we lived in an environment of total trust. It could work if everyone would keep this information private and would not use the data gathered against the patient or physician. Remember the social contract in medical care is between the patient and the physician.

“Under the three-year HMSA Initiative for Innovation and Quality the plan has committed $20 million toward the purchase of EMRs for physician practices. It will contribute up to half the cost of an EMR, capped at $20,000 per physician, for about 1,000 physicians.’

The physician would still have to pay $30,000 for something he does not want and he does not perceive will increase the quality of his care. It is viewed as a tool that will be used to punish him.

Cisco believes a “significant” amount of funds under the hospital program will go toward I.T., but the overall goal is to reduce practice variances and improve safety. Details of the program remain under development. “We’ve made the commitment and now are talking to hospitals,” he adds.”

Please notice the implication is the system is going to tell the physician what he should do to practice “good” medicine as defined by the insurance companies and hospital administrators. This seems like a way to generate more mistrust between physicians and the insurance industry.

“The program to help pay for EMRs is open to any physician who doesn’t have EMR software. But the focus will be on small and rural practices where adoption rates are low. HMSA hopes it will get most of these practices to take up its offer, Cisco says. “This is an effort to bring on slower adopters of the technology.”

My response is good luck!

The EMRs also will have to be certified by the Certification Commission for Healthcare Information Technology. HMSA is expected to have a list of acceptable EMRs available by the end of 2006.

If this program was perceived by the physicians as a good idea it would have to be a single uniform software program with measurable data points available to the physician for his proving an improvement in his quality of care to the patient. Multiple software vendors will increase the costs and decrease the mobility of the data collected. I will devote more time to describing the ideal EMR in the ideal MSA system. The system would greatly benefit the patient and the physician. The benefit to the facilitator stakeholders would be secondary and not punitive to the patient or the physician.

“Heavy penetration of EMRs in Hawaii could support more comprehensive pay-for-performance programs. HMSA for five years has had a pay-for-performance program that gives physicians and hospitals “modest” payments for meeting certain quality standards, Cisco says. The new initiative is much larger than existing P4P programs, he notes. “Our board thought we’d ramp this up a bit, put out this $50 million commitment and see what it achieved.”

Does anyone out there know the potential punishing effects to the healthcare system that pay for performance will inflict. In my view pay for performance is not well thought through presently. Many physicians are totally opposed to the notion because the decisions of performance are going to be made by the same insurance company administrators that used incorrect data to produce the failed punitive report card system.

This ambitious program is going in the opposite direction of the concept of the ideal Medical Saving Account. It is not empowering to the patient or physician. P4P in the present form does not provide incentive to the patients or the physicians to improve their performance. It is an administrative mechanism devised to dictate physician behavior, undo patient privacy and reduce payment.
It is sure to fail at best and generate more distrust and waste at worst. The healthcare system does not have three years to waste on this folly. The endeavor is bizarre to me. It is a waste of $50 million. I predict the $50 million loss will be passed on to the patients in the form of increased premiums
The $50 million could go a long way to create the ideal EMR in an ideal insurance system (MSA). Some smart entrepreneurial company will figure it out some day. I hope sooner rather than later.

Stanley Feld M.D.,FACP,MACE

In my view none of the published estimates of administrative costs to the healthcare system are correct. The latest estimate of administrative costs to the healthcare system was $150 billion dollars. I bet this estimate is only half of the administrative costs. The estimate represents only the costs the insurance companies add on to their insurance premium calculation. It does not represent the cost to the physicians to process each claim.

My estimate for the administrative cost to the physician for each office visit is $35- $40. The physicians’ administrative costs include the cost of physicians’ time to complete the paper work for each encounter as well as the cost of back office personnel for processing each claim to completion. Many claims are adjusted by the insurance company and disputed by the providers. The claims are then resubmitted for another round of non medical value added costs. The total cost to the system could represent $300 billion dollars. Three hundred billion dollar savings can go a long way to reducing insurance premiums to manageable and affordable levels. I could also go a long way toward increasing accessibility to care.

A few weeks ago I wrote about economists declaring that we can afford the cost of our excellent healthcare system. I blasted the concept as ridiculous. The economists ignore the inefficiencies and not medical value added cost to the system.

This week an article appeared titled “Running on Empty: Healthcare As the Engine of the Economy by Brian Kleeper and Alian Enthoven.
“Healthcare insiders know that the industry’s rosy prospects can continue only if its funding remains stable. Most also acknowledge that the dollars are not likely to flow as they have in the past.
The reality into the foreseeable future is that healthcare–at least beyond a narrow definition of “basic care”–will remain a voluntary buy. In fact, there’s every indication that group purchasers are quietly abandoning the market. A wealth of recent data shows that healthcare cost growth is pricing corporate and governmental purchasers out of the market for coverage.
Reports from the Kaiser Family Foundation and the Department of Commerce’s Bureau of Economic Analysis show that, between 1999 and 2004, premiums–the point where costs converge from throughout the healthcare continuum–grew 5.5 times general inflation, 4.0 times workers earnings and 2.3 times the growth of business income.”

Please recall that much of the increase also results from a faulty DRG system. The present system reimburses on hospital charges and not hospital costs. The DRG system contributes to the engine of the inflationary medical costs.

“The numbers are spectacular. And purchasers are responding. In September 2006, another Kaiser report on employer health benefits showed that, between 2001 and 2006, the percentage of employers offering coverage plummeted from 68 percent to 61 percent, a 10.3 percent drop over five years or a 2.1 percent annual erosion rate. During the same period, the percentage of employees with coverage dropped from 65 percent to 59 percent. Data from other sources show that certain workers–those in the private sector, service workers, retail employees–were particularly vulnerable to losing coverage.
Meanwhile, Florida’s Office of Insurance Regulation released data showing that, between 1996 and 2004, 132,000 small employers (with 50 or fewer employees) stopped offering health coverage. This represents a 53 percent drop, while enrollees in small group plans fell by 760,000 individuals (42 percent, or 5.25 percent annually). The state’s population grew by three million during this period.”

As fewer and fewer people have health insurance coverage there is less and less premium dollars in the system. At present we have 46.7 million uninsured in America, 80% of whom would buy affordable insurance if they could.

Jon Lowder’s blog entry of November 10, 2006 nailed the problem. There are precipitous enrollment drops and an increasing uninsured population.

“These precipitous enrollment drops make sense, particularly when you compare the scale of healthcare cost to earnings. The actuarial firm Milliman calculated that the total coverage costs for a family of four averaged $12,214 in 2005. But one-quarter of the nation’s workers made less than $18,800, and one-third of its families made less than $35,000. How can mainstream Americans stay in a game that’s stacked like this?”

Worse, healthcare is 1/7th of the economy and 1/11th of its job market. If this sector develops a large demand-resource mismatch and becomes financially unstable, the disruptions could cascade to and destabilize others sectors, threatening the national economic security.

Many people who follow the healthcare crisis know all of this. Unfortunately the public is not aware of much of it. We only realize that health insurance cost more and more. We have discussed much of this previously.
However, 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 can not 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 the patient to be in control of their healthcare dollar and selling pure insurance that is fairly priced. The ideal Medical Saving Accounts system represent pure insurance in the form of high deducible health insurance and motivation for the patient to become an informed consumer.

The cost of processing claim 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 to costs in the healthcare system. The losers will be the non competitive insurance company. The winner will be the bright flexible company that puts the system in place.