Stanley Feld M.D.,FACP,MACE 

It is hard to remember all the defects in President Obama’s Healthcare Reform Act at once.

President Obama’s Healthcare Reform Act is so flawed it cannot possibly work as it was intended. It must be repealed. A serious, thoughtful, practical and common sense way to “Repair The Healthcare System” must be enacted before all the stakeholders have adjusted to President Obama’s coming changes that will create a more dysfunctional system.

A reader sent me a photo of a poster hanging in his local ice cream store. It is a reminder of previous criticisms of President Obama’s Healthcare Reform Act.

I predicted and discussed all the defects it the Healthcare Reform Act that will come back to haunt President Obama and  America’s consumers.

The last month the cracks in President Obama’s Healthcare Act have started to widen. Some of the cracks are starting to look like the entire Healthcare Reform Act is falling apart.

1.  President Obama’s selected model Clinics for his integrated care “experiment” (ACOs) have turned down applying to this pilot study. The goal of these pilot projects was to demonstrate that Accountable Care Organizations (ACOs) will reduce the cost of medical care and increase the quality of medical care. ACOs are a primary tool in proving that President Obama’ Healthcare Reform Act will be effective in reducing cost and increasing quality of medical care. There are too many impractical and costly regulations. There are too many logistical barriers to creating ideologically effective ACOs.

2. Individual States are refusing to set up federal directed State Health Insurance Exchanges as directed by President Obama’s law. The insurance exchanges’ economic burdens will be shifted to the state at the direction of the federal government. The end result will be to increase state budget deficits and decrease state control over their local healthcare delivery systems. Texas is planning to set up its own Health Insurance Exchange under Texas rules even though Governor Perry believes “Obamacare” will be repealed.

“Governor Perry firmly believes that Texans should be in charge of our health care programs.”

There is great antipathy between Governor Perry and President Obama. Texas officials have concerns that President Obama’s administration in the end will say,

 “You all didn’t bother to make a significant effort with the lead time you had,’ ”

 “I wouldn’t put it past President Obama’s administration not to certify what we come up with.”

President Obama’s advisors at the Urban Institute have told him that he is creating an additional entitlement and increasing hidden taxes with his Health Insurance Exchanges. Once the America people discover that this is President Obama’s intention they will oppose Healthcare Insurance Exchanges. The exchanges are not going to put a muzzle on the healthcare insurance industry’s devouring of the healthcare dollar. One must question why the healthcare insurance industry is in favor of Healthcare Insurance Exchanges. The answer is they will increase their share of the healthcare dollar with Healthcare Insurance Exchanges.

 I suspect few people understand this.

President Obama is once again decreasing states’ rights and limiting personal freedom to choose. President Obama’s exchanges will increase states’ budget deficits. The result will be an increased tax burden for all.

"The exchanges don't just handle health insurance. Rather, they are expected indirectly to operate an entirely new "tax" system that collects another 9 or 10 cents from most insured household for every additional dollar earned and a new "welfare" system that tries to determine in advance and at various later stages households' eligibility for different subsidies."  

3. A discovery of a quirk in the law would allow an additional 3 million who earn over $64,000 to $80,000 a year to enrollee in Medicaid. Medicaid cannot attract enough physicians for its current enrollees. Physicians refuse to participate because its reimbursement is less than physicians’ overhead. Adding 16 million new enrollees plus an additional 3 million is untenable.  

4. The lawsuits by 24 states challenging the constitutionality of President Obama’s Healthcare Reform Act is slowly proceeding to the Supreme Court. The Supreme Court might have tipped its hand as to the direction it is leaning last week by another decision in favor of “States Rights” and “individual rights.”

Justice Kennedy wrote in an opinion,

 "The whole point of separation of powers, the whole point of federalism, is that it inheres to the individual and his or her right to liberty; and if that is infringed by a criminal conviction or in any other way that causes specific injury, why can't it be raised?"   

5.  Last week McKinsey published an in-house survey that showed that at least 30% of corporations would drop employee sponsored healthcare insurance (ESI) and let employees buy the government’s  “affordable and subsidized” healthcare insurance (the Public Option) through government’s Healthcare Insurance  Exchanges in each state.The government criticism of the survey was unjustified. The criticism weakened President Obama’s support even further because it became apparent that he was going to try to intimidate his distractors and not heed reality.

All of these defects in Obamacare are becoming more apparent to all consumers. Public support is decreasing daily. It is going to take the Supreme Court to declare it unconstitutional or a Republican President with a Republican House and Senate.

President Obama remains oblivious to the defects and unpopularity of his Healthcare Reform Act. 

Stanley Feld M.D.,FACP,MACE

The truth about President Obama’s healthcare reform act is becoming obvious. The problem is the traditional media is not covering the true implications of President Obama’s healthcare reform act. The traditional media simply prints the administrations press releases. While the media covers some of the problems, it does not connect the dots to produce the true picture.

There are so many problems with President Obama’s healthcare reform act that the only way to fix it is to repeal it and start over again.

President Obama used tricky tactics to get the bill passed. They are now catching up with him. This week several problems became obvious. A significant problem as putting all the decision making power in the hands of the Department of Health and Human Services(HHS).

Kathleen Sibelius admitted to the House Energy and Commerce Health Subcommittee that the books were cooked in the passage of the healthcare reform act. Kathleen Sibelius and CMS made fools of themselves at an Energy and Commerce Health Subcommittee committee hearing admitting that President Obama cooked the books by double counting.

It was also clear that HHS did not have a handle on the potential unintended consequences of the healthcare reform act.

 Representative Marsha Blackburn (R-TN), asked Kathleen Sibelius to estimate the amount of money lost to Medicare and Medicaid fraud in those programs. She said, “We don’t know.” The Democratic congress and President Obama has put vast power in Kathleen Sibelius’ hands.”

She is in control of 18-25% of America’s gross domestic product, yet she did not know the answer to this basic question.

Do you think anything else could be overlooked?

Representatives of CMS admitted they did not know the extent or cost of Medicare and Medicaid fraud. Neither any of the CMS representatives nor Kathleen Sibelius knew the real estimate of the costs of healthcare reform.

It is becoming clear that President Obama’s “seminal accomplishment”, his healthcare reform act, will make medical care unaffordable, balloon the federal and state deficits even further, raise taxes and provide less care. The law will include healthcare insurance with less coverage and provide a decrease of access to care. The quality of care will not improve.

Last month, Judge Vinson’s opinion effectively put an injunction on the law. He expected the Justice Department to appeal immediately. President Obama and HHS ignored the judgment and continued to implement the law. The Justice Department has not filed an appeal after 30 days. Judge Vinson was annoyed at the administrations delaying tactics, and its attempt to ignore his ruling.

He is trying to force President Obama’s administration to file an appeal within one week.

The House passed a bill repealing the provision in “Obamacare” requiring everyone who pays more than $600 for a product or service to provide the vendor with a 1099 form. The purpose was to collect more taxes to pay for President Obama’s healthcare reform act.

The provision created a tremendous paperwork burden for small businesses for relatively small payments. The IRS estimated it would increase revenue by $17 billion dollars. Seventeen billion dollars is a long way from covering the $1.5 trillion dollar budget deficit this year. The cost to small business owners would be great enough to bankrupt some of them.

The provision would have increased the number of 1099 forms filed each year by something like two thousand percent. In the end, 70 percent of the House voted in favor of repeal, including 238 Republicans and 76 Democrats.

President Obama said he supported the repeal. His trick is he did not suggest a source for potential revenue replacement. Senate Democrats are balking repeal. They complain there is no revenue replacement. Repeal will increase the healthcare reform act’s deficit even further.

Harry Reid and the Democratic Senate do not want to pass the law. Mr. Reid is demanding a provision to fund the $17 billion dollar loss.

The weeds are getting higher each day for President Obama and his healthcare reform act. The truth of the high costs are coming out.

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

Stanley Feld M.D.,FACP,MACE

Physicians might not now understand the exact implications of President Obama’s healthcare reform act. The impact will be terrible for physicians and their patients.

“The act will reinforce the worst features of existing third-party payment arrangements in both the private and public sectors — arrangements that already compromise the professional independence and integrity of the medical profession.”

I am writing this for both patients and physicians. Both must increase their understanding of the provisions of President Obama’s healthcare reform law. The law will decrease, not increase, physicians’ ability to deliver care.

1. Physicians will find themselves subject to more, not less, government regulation and oversight.

1. Physicians will become increasingly dependent on unreliable government reimbursement for medical services.

1. Medicare and Medicaid payment, including irrational government payment updates, are preserved but expanded to larger portions of the population. Limited federal funding will result in lower reimbursement to physicians.

1. President Obama’s healthcare law will create numerous bureaucratic agencies. These not elected agencies the authority to dictate health benefits, and medical treatments.
2. Physicians will not receive serious tort reform relief. This is a major problem in the current system. There are no provisions in the law to compensate for the liability expenses.

1. Physician surveys reveal deep dissatisfaction and demoralization among medical professionals as illustrated in my blog entitled the Vanishing Oath. I predict the dissatisfaction will intensify.

Eighteen million people are expected to gain healthcare coverage through Medicaid in the next ten years. Medicaid is partly funded by the federal government and the individual states. Medicaid is administered by individual states. States outsource administrative services to the healthcare insurance industry. The federal government decides on the percentage of funding it provides to each state. Different states get different levels of funding according to the deals state representative make with the federal government.

Some might recall the fuss when Sen. Ben Nelson of Nebraska received full funding for Nebraska in return for his support of President Obama’s healthcare bill.

There are many problems with increasing the Medicaid burden on the states.

1. States are broke. The cumulative amount is $3.1 trillion dollars in unfunded liabilities. There is a $55 billion dollar collective gap between states’ income and obligations next year.
2. Some states have more people who will qualify for Medicaid than others.
3. States will have to raise local taxes on the middle class.
4. Medicaid reimbursement is lower than physicians’ costs to provide the service.
5. Many physicians do not accept Medicaid patients, creating a work force shortage.

Medicaid reimbursement is 56% of private insurance reimbursement. Medicare pays 81% of private reimbursement. However, private insurance reimburses 60% of physicians’ billings. Therefore, Medicaid pays 33.6% of the billed rate and Medicare pays 48% of the billed rate. Clearly, it is better for physicians not to accept Medicare, Medicaid or private insurance.

Reimbursement for Medicare and Medicaid services will be lowered further by President Obama’s healthcare reform act. The government cannot afford to increase reimbursement.

Medicare physician payment is annually updated on the basis of a defective Sustainable Growth Rate (SGR) formula.

The SGR cumulative reduction has been delayed until November 30th. Medicare reimbursement will be reduced by 21.3% percent on December 1st. The impact on the physician workforce is not difficult to imagine.

Rather than Repairing the Healthcare System, President Obama is moving forward in destroying the healthcare system.

Instead of trying to fix the unaffordable government entitlements and making them affordable with satisfied stakeholders, President Obama is expanding the entitlements and making them more unaffordable to patients and the government.

President Obama’s problem is the continuation of the negative elements in the healthcare system.

“Today there is sporadic access issues for patients in Medicare, and major access problems for patients in Medicaid.”

What is going to happen when the entitlement is expanded?

President Obama’s healthcare law does not change the general pattern of the government’s systems of physician payment. It increases government control over physicians and adds layers of bureaucracy and regulatory restrictions to the delivery of medical care.

Three new bureaucratic agencies are created and have a direct impact on physicians and the practice of medicine.

1. Patient-Centered Outcomes Research Institute. The Institute will be financed through a Patient Centered Outcomes Research Trust Fund. By 2013, the fund will receive $150 million dollars a year from the government. Its mission will be to examine clinical effectiveness of medical treatment, procedures, drugs, and medical devices (Dr. Donald Berwick.) Just imagine the amount of government control this organization with have on a physician’s medical decision making ability.

1. The Independent Payment Advisory Board. Its goal is to reduce the per capita growth rate in Medicare spending. It will be a 15 member board appointed by President Obama. Its recommendations will be passed on to the CMS director. This is where rationing of care begins (Dr. Don Berwick). This Board increases the power of the executive branch and weakens congressional power.

1. The Physician Quality Reporting Initiative. Its goal will be to focus on the quality of medical care delivered to Medicare beneficiaries. I have not seen an appropriate definition of quality medical care. The initiative will institute rules and regulations. These rules and regulations will be time consuming to physicians and distract from patient care. This Board will try to develop pay for performance rules. Pay for Performance will not work for all of the reasons I discussed earlier. Government bureaucrats are good at making rules and regulations. The rule may be inefficient and ineffective. The government has not been proven efficient at implementation and enforcement.

Pr
esident Obama should be constructing a healthcare system that eliminates the defects in the present system.

President Obama is disregarding consumers’ power and intelligence. If he created a system in which every consumer was responsible for his own healthcare dollars and his own health, he would be creating a system that would work for patients, physicians and the government. The healthcare insurance industry would have less expense and make less profit.

Instead, he is creating a system that is going to make everyone unhappy.

There is more grief ahead.

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

Stanley Feld M.D.,FACP,MACE

Unfortunately, the answer is yes.

President Obama’s healthcare reform plan will fail because of its poor construction.

The majority of Americans agree with President Obama’s goals. Americans want affordable universal high quality healthcare. President Obama’s healthcare reform bill will not accomplish these goals.

President Obama’s healthcare reform bill will waste 2 trillion dollars, restrict access to care, raise taxes, ration care and destroy infrastructure of a healthcare system that provides excellent medical care to the sick.

Our healthcare system is broken because prices are out of control. President Obama’s healthcare reform bill with a mushrooming government bureaucracy will not control prices by competition. It will try to control prices by regulations and force. Price controls never work.

Previous behavior is a predictor of future behavior. It follows that previous healthcare system reform failures are a predictor of future healthcare reform failure.

President Obama’s healthcare reform plan is similar to the failed Massachusetts healthcare reform plan (Romneycare). Romneycare was destined to fail from the onset.

The similarities between Obamacare and Romneycare are glaring;

1. Both the Massachusetts healthcare reform plan and Obamacare mandate individual healthcare insurance.
2. If individuals do not have insurance they must pay a penalty.
3. Most businesses are required to participate or pay a fine.
4. Both healthcare reform plans rely on government-designed purchasing exchanges (healthcare insurance exchanges)
5. The healthcare insurance exchanges are supposed to provide a vehicle to control private health insurance.
6. The uninsured are covered by the expansion of Medicaid and with Obamacare the expansion of Medicare.
7. Qualified citizens receive healthcare insurance subsidies to help pay for their mandated healthcare insurance policies.
8. The state of Massachusetts has set up many new boards and committees to oversee and administer the healthcare reform plan. The added bureaucracy has failed to control costs.

I predicted the Massachusetts plan would fail at its onset. It has been plagued with cost overruns from the start. I cannot image President Obama’s plan can be budget neutral after ten years. I suspect many Americans can’t image it either. I think the Scott Brown election has given America the notion that the citizens of Massachusetts don’t think Obamacare can be successful.

Why did the Massachusetts Healthcare Reform Plan fail?

1. The healthcare reform plan is administered by the healthcare insurance industry. It controls the healthcare dollar and determines the premiums based on defective accounting rules. These rules permit the healthcare insurance industry to overestimate expenses and underestimate reserves. The result is increased premiums.
2. No one has the political will to challenge or change these rules. The rules permit the healthcare insurance industry to declare a loss while it is removing sixty five cents out of every healthcare dollar from the healthcare dollar pool.
3. There are 410,000 people who are newly insured in Massachusetts. Of those 200,000 are fully subsidized by Massachusetts state insurance exchange.

Policy makers underestimated the number of people that would qualify for subsidy.

1. 3% of the population remains uninsured. The total 140,000 uninsured are required to pay a penalty. Half (70,000) uninsured cannot afford the premiums or penalty and receive a waiver.
2. The state’s premiums have increased every year since the onset of healthcare reform. A typical family of four’s annual premium costs almost $13,788, the highest in the country. This is twice the cost of premiums in Texas. The premiums are 27% higher than the national average.
3. This cost does not include out of pocket expenses.
4. Massachusetts regulations serve to eliminate competition in the healthcare insurance market.
5. Mandates dictate the services needed to be covered.
6. Healthcare insurance vendors are required to sell "just-in-time" policies even if people wait until they are sick to buy coverage.
7. Patients game the system by purchasing health insurance when they need it. Patients then drop insurance a few months later and pay the less expensive penalty. The same will apply to President Obama’s plan.
8. Massachusetts’ safety-net hospitals are treating a disproportionate number of lower-income and uninsured patients. State compensation of these safety-net hospitals has been reduced under the new healthcare plan. It is only a matter of time before the safety net hospitals will declare bankruptcy. The alternative is to increase state taxes further. The result is people will move out of Massachusetts lowering the tax base
9. There is a "critical shortage" of primary-care physicians as a result of increasing the number of people covered and an increase in demand for medical services.
10. Physician compensation is decreasing. Physicians are fleeing the state. Patients cannot get doctor appointments.
11. New patients wait 44 days to get an appointment with a primary-care doctor. A secondary market for primary-care doctor appointments is developing. People are selling their appointment times to patients.
12. Appointment time shortages have led to an increasingly expensive emergency room visit for basic medical services. Emergency room visits increased 7%. More than half need emergency room attention. ER visits are very costly.
13. President Obama gave the state of Massachusetts an 8 billion dollar bailout to help cover healthcare reform expenses. The healthcare insurance industry benefited by the stimulus bailout.

The state has refused to permit the insurance industry to raise rates. The insurance industry will leave the state or decrease reimbursement for services. The results are obvious.

If you do not fix the defects in the healthcare system you will not fix the financial difficulties. People must own their healthcare dollar, be responsible for their own care and have the freedom to choose. All this adds up to consumer driven healthcare using the ideal medical saving accounts.

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