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Americans Should Be Listening

February 10, 2020
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Stanley Feld M.D.,FACP,MACE

Bernie Sanders and the progressive Democrats are not interested in learning from other countries’ mistakes.

Their ideology blinds them to the fact that socialized medicine does not work. I vividly remember John Kerry and Barney Frank telling President Obama that the Affordable Care Act needs a Public Option. The Affordable Care Act would fail if it did not have a Public Option. With a Public Option included they said America would be well on its way to a single party payer system.

They said a single party payer system is the only healthcare system that would work

President Obama told them he had a clandestine “Public Option” built into Obamacare. However, he was never able to bring it about.  

Progressives believe deeply in their ideology. They do not consider past history, present reality or facts. 

Neither does the American College of Physicians. In a position paper it recommended Medicare for All. It was followed up with a letter published in the New York Times with 2,000 signatures out of the 159,000 members advocating Medicare for All.

“In a separate but related move to the ACP’s announcement, more than two thousand physicians on Monday announced an open letter to the American public, prescribing single-payer Medicare for All, in a full-page ad in The New York Times that will run in the print edition on Tuesday, January 21, 2020.”

https://www.nakedcapitalism.com/2020/01/in-historic-shift-second-largest-physicians-group-in-us-has-new-prescription-its-medicare-for-all.html

I wonder how many of these signatories have any idea of what the economic impact of “Medicare for All.” I really wonder how many members out of the 159,000 would support the position. I know I do not support the ACP’s position.  

All progressives have to do is look at what is happening to socialized medicine all over the developed western world and notice it is unsustainable and its citizens are dissatisfied with it.

Healthcare systems in the developed world are failing even as the ideologs believe it is succeeding.

America’s healthcare system is also having many problems. Americans are dissatisfied with our healthcare system. The healthcare system has gotten worse since Obamacare was passed. The government is responsible for making our healthcare system worse. It has not done the things I have suggested to repair our healthcare system.

 The Commonwealth Fund (a private progressive foundation) with a focus on healthcare is certain that a single party payer system is the only viable healthcare system.

The report ranked healthcare systems throughout the developed western world.  In its 2014 published ranking the National Health Service of Great Britain was considered the best medical system among the 11 of the world’s most advanced nations, including Canada, France, Germany, Switzerland and Sweden.

 The United States came in last.

 Few “experts” have the time or patience to read the complete report or pick out the defects in the report.

Most people read the summary. The summary in this report does not reflect the truth about the evidence present in the report.

The Commonwealth Fund’s rankings of countries is contradicted by objective data about access and medical-care quality in these countries in peer-reviewed academic journals.

The Commonwealth Fund’s methodology is defective. Its conclusions relied heavily on subjective surveys about “perceptions and experiences of patients and physicians.”

Kenneth Thorpe made an important point by examining differences in disease prevalence and treatment rates for ten of the most costly diseases between the United States and the ten European countries with a single payer system.

He used surveys of the non-institutionalized population age fifty and older. Disease prevalence and rates of medication and treatment are much higher in the United States than in these European countries.

Why would that be?

There are many reasons for this finding. The main one is the availability of care in the United States compared to the ten socialized western countries.

Another is lifestyle and incidence of obesity in the United States. Both lead to the onset of chronic disease and increased treatment.

 “Efforts to reduce the U.S. prevalence of chronic illness should remain a key policy goal.”

“Americans are diagnosed with and treated for several chronic illnesses more often than their European counterparts are.”

Americans diagnosed with heart disease receive treatment with medications and procedures more frequently than patients in Western Europe.

In the past local peer review was all that was needed along with confidence in the treating physician’s judgment. This confidence in physicians’ judgment has been destroyed by excessive media sensationalism. The real percentage of abuse is small and easily discoverable by peers and the use of social media.

Cancer treatment survival rates in America are far greater than the survival rates in Britain, and countries in western Europe.

The reasons for the higher cure rates is the availability of early detection and treatment.

Cancer treatment costs are high. The government should look into the reasons for this high cost and try to lower the cost.

The Commonwealth Fund’s report does not consider any of these factors.

“Over a quarter of a million British patients have been waiting more than six months to receive planned medical treatment from the National Health Service, according to a recent report from the Royal College of Surgeons. More than 36,000 have been in treatment queues for nine months or more.

Long waits for care are endemic to government-run, single-payer systems like the NHS. Yet some U.S. lawmakers want to import that model from across the pond. That would be a massive blunder.”

https://www.forbes.com/sites/sallypipes/2019/04/01/britains-version-of-medicare-for-all-is-collapsing/#d1df33b36b89

The NHS has a waiting list of 3.2 million people for admission to the hospital. In London alone over 500,000 patients are on a waiting list for diagnosis and treatment.

A large percentage of patients triaged as urgent after being diagnosed with suspected cancer have a 62-day wait time to receive therapy.

Consider how long it takes to get care at the emergency room in Britain. Government data show that hospitals in England only saw 84.2% of patients within four hours in February. That’s well below the country’s goal of treating 95% of patients within four hours — a target the NHS hasn’t hit since 2015.

Now, instead of cutting wait times, the NHS is looking to scrap the goal.

Wait times for cancer treatment — where timeliness can be a matter of life and death — are also far too lengthy. According to January NHS England data, almost 25% of cancer patients didn’t start treatment on time despite an urgent referral by their primary care doctor. That’s the worst performance since records began in 2009.

Today In: Industry

And keep in mind that “on time” for the NHS is already 62 days after referral.

Unsurprisingly, British cancer patients fare worse than those in the United States. Only 81% of breast cancer patients in the United Kingdom live at least five years after diagnosis, compared to 89% in the United States. Just 83% of patients in the United Kingdom live five years after a prostate cancer diagnosis, versus 97% here in America.

The British Health and Social Care Act 2012 authorized the use of the small private sector of healthcare to help the NHS with its problems.

The share of NHS-funded hip and knee replacements by private doctors increased to 19% in 2011-12, from a negligible amount in 2003-04. Each year there is an increase in NHS funded care by the private sector.

It sounds like the VA Healthcare System’s solution to its problems.

The NHS also routinely denies patients access to treatment. More than half of NHS Clinical Commissioning Groups, which plan and commission health services within their local regions, are rationing cataract surgery. They call it a procedure of “limited clinical value.”

It’s hard to see how a surgery that can prevent blindness is of limited clinical value. Delaying surgery can cause patients’ vision to worsen — and thus put them at risk of falls or being unable to conduct basic daily activities.

“It’s shocking that access to this life-changing surgery is being unnecessarily restricted,” said Helen Lee, a health policy manager at the Royal National Institute of Blind People.

Many Clinical Commissioning Groups are also rationing hip and knee replacements, glucose monitors for diabetes patients, and hernia surgery by placing the same “limited clinical value” label on them.

Patients face long wait times and rationing of care in part because the NHS can’t attract nearly enough medical professionals to meet demand. At the end of 2018, more than 39,000 nursing spots were unfilled. That’s a vacancy rate of more than 10%. Among medical staff, nearly 9,000 posts were unoccupied. Many physicians have left the NHS and have gone into private practice. Many do both NHS service and private practice.

These shortages could explode in the years to come. In 2018, the Royal College of General Practitioners found that more than 750 practices could close within the next five years, largely because heavy workloads are pushing older doctors to retire early.

English people who can afford private care and private healthcare insurance to avoid the NHS are switching to private insurance even though they have to pay $3,500 for each man, woman and child in a family into the NHS.

Physician shortages are the result of inadequate funding. The cost of the NHS with all these restrictions are unsustainable.

The single party payer system (NHS) is struggling with unsustainable costs even though we hear from progressives how great socialized medicine is in England.

The key ingredient missing in all these systems is patient responsibility for their health and their healthcare dollars. Both are powerful motivators for healthy living and detecting disease early.

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



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Please Read Between the Lines

May 9, 2019
inDisinformation and the healthcare system, Medicaid, Medicare, Medicine: Healthcare System
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Please Read Between the Lines

Stanley Feld M.D., FACP, MACE

Most of us have trained ourselves to speed read the daily newspaper. I have asked my readers to read between the lines of the New York Times’ healthcare articles. Most articles are not factual or half-truths. The articles are an opinion and express a confirmation bias. 

“Confirmation bias is the tendency to search for, interpret, favor, and recall information in a way that confirms one’s beliefs or hypotheses while giving disproportionately less attention to information that contradicts it.[32] The effect is stronger for emotionally charged issues and for deeply entrenched beliefs. People also tend to interpret ambiguous evidence as supporting their existing position.”

https://en.wikipedia.org/wiki/Bias#Confirmation_bias

Often, the application of confirmation bias is subtle.  During speed reading, one’s opinion can be influenced by the presentation of confirmation bias. The bias is interpreted as fact because the “media is the message.”

The traditional media is losing its influence on our culture because peoples are realizing it is feeding us a confirmation bias that does not comport with reality.

The development of ideological manipulation is a science unto its own. The print media and television media are its masters. The traditional mainstream media leans towards the progressive left. 

Conclusions should be backed by facts and not by opinion. All sides of an opinion should be presented. A huge problem is social science is imperfect. It does not use scientific principles utilizing reproducible double-blind studies.

Much of the traditional media sound like an echo chamber. It repeats the same soundbites over and over again rather than studying all the facts and reaching a logical conclusion.

In Carl Sandberg’s book, “The Prairie Years’ he said, If you tell a lie it over and over again it eventually becomes the truth.” If the confirmation bias is wrong, the public pays the price to correct it down the line.

Charles Blahous, a former Social Security and Medicare public trustee, has estimated that under Bernie Sanders’ plan of “Medicare for All”, the government could pay about 40 percent less than what private insurers now pay for medical care.

There are large discrepancies in these payments among experts. It has been estimated that there will be a 32.2 trillion-dollar deficit in a “Medicare for All” program over a ten-year period.

I would not believe the saving predicted by Chares Blahous. He was involved in creating a large deficit in our seniors’ Medicare program with the implication that Medicare would be financially viable.

It is predicted by a pro “Medicare for All” advocates, if this version of “Medicare for All” worked as planned, everybody would be insured, health care usage would rise sharply because it would be free without even a co-payment, and America would spend less overall on health care.

The math does not prove this theory. It does appeal to the notion that free is good.

This is a Democratic party pipedream to get more votes. I hope Americans do not fall for this false promise. The Democratic party has done this to taxpaying citizens of all ethnic groups over and over again in the past.

The New York Times has become a propaganda machine for progressives. 

On March 3, 2019, David Brooks’ article headline washttps://www.nytimes.com/2019/03/04/opinion/medicare-for-all.html?searchResultPosition=1

David Brooks really didn’t mean it. He is just setting the reader up in order to express his confirmation bias.

“The Brits and Canadians I know certainly love their single-payer health care systems. If one of their politicians suggested they should switch to the American health care model, they’d throw him out the window.”

The reality is 80% of Brits and Canadian are not sick and do not interact with their healthcare system.

However, they have a false sense of security that they have good healthcare insurance. When they get sick or need emergency specialty care they realize the system is less than they thought it was. Both Canada and Britain have provider shortages, lack of access to care, long appointment waiting times and large financial deficits.

The defects in their healthcare systems can be followed in the local newspaper and not in the government’s press releases.

David Brooks goes on trying to convince us that “Medicare for All” is a good idea. Progressives have been telling us this since 1935 when Wilber Mills tried to ram a single party payer system down America’s throat in the midst of the great depression.

It didn’t work then, and I hope Americans do not fall for it now.

David Brooks says; “So single-payer health care, or in our case “Medicare for all,” is worth taking seriously.”

” I’ve just never understood how we get from here to there, how we transition from our current system to the one Bernie Sanders has proposed and Elizabeth Warren, Kamala Harris and others have endorsed.”

He implies he doesn’t understand how it could work but says a lot of top-flight politicians have endorsed it. Therefore, they know more than he does.

“Despite differences between individual proposals, the broad outlines of Medicare for All are easy to grasp.”

“We’d take the money we’re spending on private health insurance and private health care, and we’d shift it over to the federal government through higher taxes in some form.”

I cannot think of a government-run agency that runs efficiently, without a large bureaucracy, red tape, or corruption. Inefficiency and corruption mean waste and higher cost.

“Since health care would be a public monopoly, the government could set prices and force health care providers to accept current Medicare payment rates.”

Price fixing has never worked. It leads to corruption

 Medicare reimburses hospitals at 87 percent of costs while private insurance reimburses at 145 percent of costs.

The important question should be, why would the insurance companies pay a 58% premium when the healthcare insurance industry knows exactly what Medicare pays? The healthcare insurance industry knows exactly what the government pays because it does the administrative services for the government.

The answer is the healthcare insurance companies are competing with each other for providers, hospitals and patients.

On April 21, 2019, a New York Times headline read: “Hospitals Stand to Lose Billions Under ‘Medicare for All’

A reaction by a reader is who cares if hospitals lose billions. They have been ripping off consumers forever.

The headline immediately established the enemy. The first two paragraphs of the article confirm the enemy. It also sets up the liberal or independent reader to develop the same confirmation bias the New York Times has.

“For a patient’s knee replacement, Medicare will pay a hospital $17,000. The same hospital can get more than twice as much, or about $37,000, for the same surgery on a patient with private insurance.”

“Or take another example: One hospital would get about $4,200 from Medicare for removing someone’s gallbladder. The same hospital would get $7,400 from commercial insurers.

Yes, this pricing is too high in my opinion for both Medicare and private insurance. However, it is the result of insurance companies lobbying and financial reporting that permits the rise in premiums.

As hospital systems become less efficient, they hire more administrators and increase executive salaries.

Many hospitals say they spend their last penny on excessive overhead. If they cannot raise prices, they claim they would go out of business.

The progressives like Bernie Sanders then chime in with their talking points that the New York Times keeps repeating.

“If Medicare for all abolished private insurance and reduced rates to Medicare levels — at least 40 percent lower, by one estimate — there would most likely be significant changes throughout the health care industry, which makes up 18 percent of the nation’s economy and is one of the nation’s largest employers.”

The propaganda worked. The confirmation bias of “Medicare for All” is solid.

The only problem is, it will not reduce the cost of healthcare. This has been proven over and over again in many countries and in many of our government run agencies.

“The Sanders plan would increase federal spending by about $32.6 trillion over its first 10 years, according to a Mercatus Center study that Charles Blahous led.

This is the same Charles Blahous that said the cost would be 40% less. What does that study do to the confirmation bias the New York Times tried to promote? Which one is fake propaganda?

“Compare that with the Congressional Budget Office’s projection for the entire 2019 fiscal year budget, $4.4 trillion.”

The 32 trillion-dollar deficit over ten years is a fair estimate. The estimate could be correct if one simply examines the Medicare and Medicaid deficits.  All we have to recall is Obamacare’s website. It was riddled with inefficiency and was a financial disaster.

 Usually, as a result of cost overruns, there is a decrease in access to care. The glaring example is the VA Healthcare System.

 “That kind of sticker shock is why a plan for single-payer in Vermont collapsed in 2014 and why Colorado voters overwhelmingly rejected one in 2016.”

“It’s why legislators in California killed a single party payer system In the California plan, the taxes are upfront, the purported savings are down the line.”

All it takes is a little reading between the lines to realize that we are subjected to ideological manipulation. “The media is the message.”

The New York Times is supposed to be “the nation’s newspaper of record with all the news that is fit to print.” With the advent of the internet and social media, Americans have more information to decide on what is the truth. People now have the ability to examine multiple sides of an issue.

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



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Did Obamacare Cause The Increase In Private Healthcare Insurance Premiums?

February 2, 2019
inMedicine: Healthcare System, Patients Problems, Politicians,Healthcare and Vested Interests, Stakeholder Abuse of the Healthcare System, Stakeholder Mistrust
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Stanley Feld M.D.,FACP, MACE

A reader of my blog received this question from one of his friends.

The reader asked me his friend’s question  “I have a question and I don’t want it to be political (as I stay away from that for many reasons).                                                                                                                                 
Health insurance is so expensive and it does not cover hardly anything. We had to get the worst plan with the worst coverage. But it was not this way 6 years ago. We could afford good coverage.   

 The question is: Did Obamacare cause this change in healthcare insurance and these problems in access to care?

A reader asked:

Which of your blogs would be the best one to show him to answer his question?

The answer to the question is YES!! I will try to explain.

If I sent all the links to your friend would be overwhelmed. There are too many to count.  I will summarize some of the major reasons Obamacare is to blame for some of the increases in private healthcare insurance premiums and the decrease in the access to care. Obamacare has led us into a financial disaster. “Medicare for All” is not the answer.

I believe the goal of Obamacare was to create greater dysfunction in the healthcare system which would lead to huge premium increases for private healthcare coverage. The public would then beg the government to adopt a single party payer system with “Medicare for all.” This has been the progressives”  goal since 1935. Do you remember Barney Frank and John Kerry saying we cannot have a single party payer system yet because we do not have the votes?

https://stanleyfeldmdmace.typepad.com/repairing_the_healthcare_/2018/10/the-main-reason-behind-rising-medical-costs.html

The government has not had a very successful single party payer systems record.  The VA Health Administration, the Indian Health Service, Medicare and Medicaid are all inefficient and financially unsustainable.

“Our federal government already runs three single-payer systems—Medicare, the Veterans Health Administration, and the Indian Health Service—each of which is in a shambles, noted for fraud, waste, and corruption.”

“Why would we want to turn over all of the American medicine to those who have proved themselves incompetent to run large parts of it?”

https://imprimis.hillsdale.edu/short-history-american-medical-insurance/

The federal government depends on healthcare insurance companies to do the administrative services for Medicare, Medicaid and Obamacare. Administrative services include negotiating payments to hospitals, nursing homes, physicians and providers on all levels.

The various healthcare insurance companies are supposed to bid for these service contracts. The insurance companies receive one global fee.  The healthcare insurance company with the contract must pay providers on a fee for service basis. The healthcare insurance companies do not have good enough data to make an accurate bid estimate.  Actuary science is not rocket science. The healthcare insurance company builds in a twenty percent cushion to the bid. If the bid was low and the healthcare insurance company that lost money Obamacare guaranteed through a complicated reinsurance formula reimbursement to the company for its loss.

Recently the government audit discovered an overpayment of $10 billion dollars to the healthcare insurance industry for Medicare Part D.

I believe there is much more overpayment in Medicare Part A, B and D because of the government bureaucracy. The government only had the money to pay 12% of the reinsurance claims of the healthcare insurance company one year. The insurance industry simply raised the premium in the private sector.

http://stanfeld.com/president-obama-somehow-finds-the-money/

http://stanfeld.com/accelerating-the-destruction-of-the-healthcare-system/

http://stanfeld.com/the-deception-and-disinformation-continues/

Nationwide, the Obama administration made $7.3 billion in reinsurance payments to health insurers. The reinsurance program, funded by taxes on health insurers and self-funded employer health plans, has been criticized by Republicans as a “bailout” for insurers.

https://www.ibj.com/blogs/12-the-dose-jk-wall/post/53906-obamacare-shovels-another-122m-to-indiana-insurers

The healthcare insurance industry then once again raised premiums on the private healthcare sector to make up for its losses. to

The government reinsurance payments weren’t enough in all cases. New York-based Assurant Inc. asked for a 26 percent hike in private premiums for 2016, due to high claims in Indiana, before that company decided to exit the Obamacare markets in all states.

This was typical price shifting.

http://stanfeld.com/?s=price+shifting

Healthcare insurance companies projected that Obamacare would result in them losing money because of adverse selection. Obamacare’s increase required benefits for both public and private insurance. Obamacare’s rules included coverage for oral contraceptives for all and coverage of pre-existing illnesses among others. A sixty-year-old male does not need an insurance policy the receives oral contraceptives.

The healthcare insurance industry asked for double-digit increases in private healthcare insurance in every state. The logic was that these enrollees would pay for the loses that would occur from the Obamacare enrollees.

http://stanfeld.com/managing-points-of-view-and-healthcare/

The government’s argument is all should pay for everyone ’s healthcare needs. These healthcare needs have increased as the population has gotten more obese and has had a rise in drug addiction. These increased healthcare risks resulted in increased actuary estimates of healthcare cost. It does not put a burden on consumers who do not act responsibly.

The increased healthcare premiums caused many employers to drop healthcare coverage for their employees. The decrease in healthcare insurance coverage added to the pressure of healthcare premium increases.

The healthcare insurance industry also plays games with the Medical Loss ratio. The result is an increase in healthcare premiums and deductibles while decreasing services. The Obamacare issued regulations that the insurance industry must dedicate 80% of the healthcare premium to direct medical care and 20 % can be used for administrative expenses for both the public government insurance and private insurance. It is the state insurance regulators responsibility to enforce the regulation.

The expenses the industry wanted to be included are;

Expenses to be included in direct medical care are:

  1. The cost of verifying the credentials of doctors in its networks.
  2. The cost of ferreting out fraud such as catching physicians over testing patients or doing unnecessary operations.
  3. The cost of programs that keep people who have diabetes out of emergency rooms.
  4. The sales commissions paid to insurance agents.
  5. Taxes paid on investments.
  6. Taxes paid on premium income.

All these expenses are administrative expenses in my view and not medical expenses. If these expenses are permitted as benefit expenses, premium money available for direct medical care would decrease. The eighty percent required for direct medical care would be markedly reduced. The result would be an increase in healthcare insurance premiums.

http://stanfeld.com/medical-loss-ratio-how-did-the-healthcare-insurance-industry-do/

http://stanfeld.com/what-is-the-medical-loss-ratio/

The calculation for direct medical care helps the healthcare insurance company prove it lost money. The insurance company then applies to state regulators for a premium increase. The state regulators permit the premium increases.  If the premium increase is refused by the regulators the insurance company threatens to leave the state. The other option the healthcare insurance company uses is to decrease the insurance services and/or increase the insurance deductibles.

Another problem has developed in the healthcare insurance industry that is causing it to raise premiums and reduce services and access to care as a result of Obamacare.

Hospital systems are buying out physicians’ practices. Obamacare has put many restrictions on physician practices. It has increased practices overhead. Obamacare has decreased the ability for physicians to use their medical or surgical judgment that they have become happy to sell their practices to hospital systems. The hospital systems now have to deal with the problems of medical practice. The cost of electronic medical records, which have not added to the quality of medical care, increased many physicians’ willingness to sell their practices to hospital systems. At the moment the percentages of hospital-owned practices are up to 65% from only 17% ten years ago.

http://stanfeld.com/physicians-barriers-to-practice-their-profession/

https://www.wsj.com/articles/SB10001424052748704122904575315213525018390

As premiums have gone up physicians have not experienced an increase in reimbursement. They have been forced to see more patients quickly to earn almost as much as before Obamacare. Obamacare has destroyed the patient-physician relationship which in my view is essential in medical care. Physicians simply do not have time to talk to patients.

Hospital systems have taken over physician populations in many communities. This gives the hospital leverage over the healthcare insurance industry. The hospital system can demand higher reimbursement because it provides all the physicians.

The large hospital systems can demand that the insurance company only use the physicians in its hospital system even if there are lower cost of care options in a community.

The result is an increase in healthcare premiums and decreased the quality of care.

All of this is the result of Obamacare. There are about ten more reasons why Obamacare has increased premiums and decreased access to care. I have left link exposed. You are encouraged to look at them to see the full explanation for some of the point I have made.

I hope this blog answers your friend’s question. :  Did Obamacare cause this change in healthcare insurance and these problems in access to care? 

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



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The Expansion Of Personalized Healthcare Insurance Benefits.  

January 3, 2019
inConsumer Driven Health Care, Disinformation and the healthcare system, Medicine: Healthcare System
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 Stanley Feld M.D.,FACP, MACE

The Senate rejected the  slimmed-down Obamacare Repeal bill as Senator John McCain was the deciding no vote July 27,2017.

“When Senator John McCain of Arizona returned to Washington with a fresh scar from brain surgery, it was widely seen as a dramatic effort to help Republicans overturn Obamacare.

 Little did Mr. Trump know that the Arizona senator would help drive the stake through legislation that sought to realize the Republicans’ seven-year dream of finally dismantling Obamacare.”

 John McCain’s vote was a surprise to everyone. Mitch McConnell then put healthcare reform on hold. Senator McConnell decided to let Obamacare die on its own.

However, the Senate rejection did not deter President Trump from pursuing healthcare reform .

He has already approved the development of purchasing associations through an executive order. The associations will sell health Insurance coverage. The rules will go into effect January 1, 2019.

He has also has attacked the drug industry with his blue print on drugs. The regulations from this will decrease the costs of drugs by decreasing the number of middlemen in the manufacture to sales process.

On October 2017 President Trump issued an executive order to promote healthcare choice and competition in the country.

https://www.whitehouse.gov/presidential-actions/presidential-executive-order-promoting-healthcare-choice-competition-across-united-states/

In the executive order President Trump said his goal was to ‘Expanded Availability and Permitted Use of Health Reimbursement Arrangements.

 The Secretaries of the Treasury, Labor, and Health and Human Services shall consider proposing regulations or revising guidance, to the extent permitted by law and supported by sound policy, to increase the usability of HRAs, to expand employers’ ability to offer HRAs to their employees, and to allow HRAs to be used in conjunction with nongroup coverage.

The Departments of Treasury, Labor, and Health and Human Services proposed regulations in October 2018 that would significantly expand personalized health benefits to consumers and would offer increasing price pressure to lower insurance prices tor U.S. businesses. Most U.S. businesses want to continue to provide medical coverage for their employees. However they need affordable prices.

The proposals, issued Tuesday, October 23, 2018 by Treasury ,Labor and HHS were a response to the October 2017  executive order from President Donald Trump.

 “That order instructed the Departments to increase the availability and usability of health reimbursement arrangements (HRAs)—especially those offered in conjunction with non-group insurance.”

The proposal is well thought out. I have a problem with some of the upcoming regulations but they are an excellent step in the right direction.

The regulations do not utilize a most important element in my ideal medical savings accounts. It does not provide financial incentives for consumers to become informed consumers of healthcare or motivated to save healthcare dollars.

Consumers of healthcare have to be incentivized to become savvy purchasers of their own healthcare and healthcare insurance coverage.

“If enacted, the regulations would create two new HRAs: something we’re calling the individual-integrated HRA, and the smaller, excepted benefit HRA.”

HRAs can be viewed as a superstructure for my ideal medical savings accounts. President Obama did everything he could to discourage the purchase of health savings accounts. His goal was to drive everyone into a single party payer system with the individual consumer’s healthcare decision are made by the government.

Despite President Obama’s attempts to discourage health savings accounts, they grew as the fastest and most popular healthcare insurance product. HSAs permitted consumers to have some   control of their healthcare spending and some of their healthcare dollars.

“In 2013, IRS Notice 2013-54 issued guidance on the Affordable Care Act (ACA) that seriously limited businesses’ ability to offer HRAs. The IRS said that while HRAs integrated with group health insurance satisfy key ACA provisions, HRAs integrated with individual health insurance do not.”

This is where Obamacare discouraged consumers to buy HSA as individuals. The insurance was not completely tax free to businesses or individual consumers.

“Congress provided some relief in December 2016 by creating the qualified small employer HRA (QSEHRA). The QSEHRA, a benefit specifically designed for small businesses with fewer than 50 employees, allows businesses to reimburse employees tax-free for their health care costs.”

With his October 2017 executive order, President Trump sought to expand HRAs even further. In the order, he asked the Treasury, the DOL, and the HHS to reexamine past rulings and “increase the usability of HRAs, to expand employers’ ability to offer HRAs to their employees, and to allow HRAs to be used in conjunction with non-group coverage.”

The new proposed regulations are a direct response to that executive order. Unfortunately it does not solve the healthcare insurance problem. The proposal keeps the insurance industry in charge of the healthcare dollars and healthcare decisions. It is a step in the right direction. It helps small business more than it helps the individual.

  QSEHRA  “Qualified Small Employer Health Reimbursement Arrangement”  Individual-integrated HRA
Business size restrictions Only available to businesses with fewer than 50 full-time employees. None.
Employee eligibility requirements All full-time employees are automatically eligible. Part-time employees can be included, but the HRA must be offered on the same terms. Employees can participate in the HRA without individual health insurance, but those without MEC must pay income tax on all reimbursements during the time they were uninsured. The business can set eligibility guidelines according to permitted employee classes, but the HRA must be offered on the same terms to all employees in each class. Employees without individual health insurance, including those covered by a spouse’s group policy, cannot participate in the HRA.
Allowance amount restrictions In 2018, annual allowance amounts are capped at $5,050 for self-only employees and $10,250 for employees with a family. The business can vary allowance amounts only by family status, age, and family size, but not based on employee classes. There are no caps on annual allowance amounts. The business can vary allowance amounts according to permitted employee classes, as well as age and family size.
Group policy requirements Businesses offering the HRA cannot offer a group policy. Businesses offering the HRA may offer a group policy, but it cannot offer both the group policy and the HRA to the same employee class.
Premium tax credit coordination Individuals participating in the HRA are still eligible for premium tax credits, but the amount of the credit is reduced dollar-for-dollar by the amount of the HRA allowance. Individuals participating in the HRA aren’t eligible for premium tax credits.

 

I will explain each category as well as its advantages and disadvantages in the near future. These regulations do much toward Repairing the Healthcare System.

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



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January 03, 2019 in Consumer Driven Health Care, Disinformation and the healthcare system, Innovations in Healthcare, Medicine: Healthcare System | 

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President Trump’s Drug Plan

November 26, 2018
inMedicine: Healthcare System, Patients Problems, Politicians,Healthcare and Vested Interests, Stakeholder Abuse of the Healthcare System, Stakeholder Mistrust
• Leave a comment

President Trump’s Drug Plan

Stanley Feld M.D.,FACP,MACE

It is very difficult to know the truth in our post truth era. Intellectuals, elites and the well-educated are criticizing every idea the Trump administration brings forward.

He was hampered in moving forward in Repairing the Healthcare System when his own Republican Party did not pass the house of representatives’ bill to repeal Obamacare. The repeal would have enabled his administration to move the repair of the healthcare system forward quickly.

Most of President Trump’s ideas when it has related to repairing the healthcare system have been common sense. They are steps in the right direction.

Common sense solutions sometimes threaten to undermine extremely profitable private and public enterprises. The pharmaceutical industry and all related middlemen are an industry that is threatened by President Trump’s common sense solutions.

The industry will do everything in its power to spin the story so that the Trump administration’s plans sound sinister to the American public.

The American public can only make decisions on the information presented. In the post-true era the public does not know what to believe. The media has been anti-Trump and is not interested in presenting the details of President Trump’s blueprint for lowering drug prices utilizing free market principles.

“The problem of high prescription drug costs is something that’s been talked about in Washington for a long time. But that’s all it’s been: talk, talk, talk.

We are privileged to have a president finally acting, by laying out a blueprint for solving these problems using private-sector competition and private sector negotiation.

We’re not going to propose cheap political gimmicks. The President’s blueprint is a sophisticated approach to reforming and improving our system.

Everyone at HHS is rolling up their sleeves to get to work on this.”

On October 28,2018 the WSJ editorial board wrote a negative view of the Trump administration’s plan to lower drug prices. It is almost as if the editorial board did not read President Trump’s proposal as it appears on the White House web site. 

I believe it is worth discussing President Trump’s blueprint for lower drug prices.

I will then present the main points in the Wall Street Journal editorial.

The blueprint starts by stating:

These are the main problems with drug prices in the U.S.

Drug costs consume 30% of the healthcare dollar. Drug costs are unaffordable to both consumers and the government. Over 40% of elderly patients consume greater than nine drugs daily. Fifty percent of those 40% experience adverse drug reactions due to drug interaction. Many end up being hospitalized thereby increasing the cost of medical care.

If a patient cannot afford to buy a drug because of its cost it will not help control their disease. A hospitalization will occur increasing the cost of healthcare.

“One of my greatest priorities is to reduce the price of prescription drugs. Prices will come down.”

President Donald J. Trump” 

The public should take this comment at face value.

These are some of the facts;

  • According to the Organization for Economic Co-operation and Development (OECD), the United States had the highest per-capita pharmaceutical spending in 2015.
  • Senior citizens pay more in Medicare Part B and Part D because government rules prevent health plans and vendors from negotiating the better deals seen in other markets.

Isn’t that crazy? The government negotiates drug prices for the VA and Military but not for seniors. The government pays less than half for drugs in the VA healthcare system than seniors do for Medicare Part B and Part D.

  • Some hospitals that receive drug discounts under the 340B program, ultimately pushing up drug prices for patients with private health insurance.

The 340B program was enacted in 1992 by congress.  Section 340B requires pharmaceutical manufacturers to enter into an agreement, called a pharmaceutical pricing agreement (PPA), with the HHS Secretary.

Under the PPA, the manufacturer agrees to provide front-end discounts on covered outpatient drugs purchased by specified providers, called “covered entities,” that serve the nation’s most vulnerable patient populations. Medicaid patients get drugs free. The government pays the pharmaceutical companies the money through a series of middlemen.

  • Lower-cost drugs are kept out of the market by drug companies gaming regulatory processes and the patent system in order to unfairly maintain monopolies.
  • Lack of transparency in drug pricing benefits special interests and prevents patients from being able to make fully informed decisions about their care.
  • Other countries use socialized healthcare to command unfairly low prices from U.S. drug makers. These lower prices place the burden of financing drug development largely on American patients and taxpayers and subsidizes foreign consumers.
    • The United States pays more than 70 percent of branded drug profits among OECD countries.
  • The drug companies claim this behavior by other countries reduces innovation and the development of new treatments. They have to make the loss of revenue up by increasing the price of drugs.

The HHS executive summary outlines not only the problem it outlines the Trump administration’s solution. President Trump’s HHS team which includes CMS has spent many years studying the abuses that have led to dysfunction of the healthcare system. I believe HHS figured out the solution.

HHS has identified four challenges in the American drug market:

 High list prices for drugs

  • Seniors and government programs overpaying for drugs due to lack of the latest negotiation tools
  • High and rising out-of-pocket costs for consumers
  • Foreign governments free-riding of American investment in innovation

 Under President Trump, HHS has proposed a comprehensive blueprint for addressing these challenges, identifying four key strategies for reform:

 Improved competition

  • Better negotiation
  • Incentives for lower list prices
  • Lowering out-of-pocket costs

 There is nothing sinister about these goals. Some will work. Direct negotiation with drug companies certainly will work. The middlemen get more money per capsule than the drug company that invented and manufactured the drug. The middlemen, who are marketers, are terrified that President Trump is going to destroy their business.

 HHS’s blueprint encompasses two phases:

 1) actions the President may direct HHS to take immediately.

 2) actions HHS is actively considering, on which feedback is being solicited.

  Complex drug networks 11 26

The president and his administration are not a heartless group of politicians who don’t care about cancer drug cost. They are interested in patients receiving the best care at an affordable price. They care about fair pricing. Their goal is to eliminate the mechanisms by which multiple stakeholders game the system. This includes the multiple middlemen and the tremendous bureaucratic load.

Is the diagram complicated enough? Can you visualize all the areas of potential abuse? Do you think a government bureaucracy can control the potential abuse?

Phase one of the blueprint:

  • Lower prices on some Medicare Part B drugs could be negotiated for by Part D plans
  • Leveraging the Competitive Acquisition Program in Part B.
  • Working across the Administration to assess the problem of foreign free-riding.

 

The administration is aware of foreign free riding. They have not published a definite free market solution to change the situation yet.

Further Opportunities

  • Considering further use of value-based purchasing in federal programs, including indication-based pricing and long-term financing.
  • Removing government impediments to value-based purchasing by private payers.

 

“Value–Based Purchasing (VBP) Linking provider payments to improved performance by health care providers. This form of payment holds health care providers accountable for both the cost and quality of care they provide. It attempts to reduce inappropriate care and to identify and reward the best-performing providers.”

 This is a stupid idea. It might save money but it tries to direct care and eliminate physician judgement. Healthcare providers will figure out how to game the system.

  • Requiring site neutrality in payment.

 

Site neutrality payment means “Under OPPS 2019, reimbursement for clinic visits in outpatient hospital settings would be capped at the rate paid for clinic visits in physician offices.”

It is about time this is happening. Hospitals are buying more and more physicians’ practices. Hospital systems bill the government hospital reimbursement prices. These prices are twice the government and private insurance companies approved office prices.

I suspect the hospital systems do not credit the physicians with this increase in reimbursement. The hospital systems leverage physicians’ intellectual property and outpatient surgical skills for the hospital systems’ own profit.

Hospital systems will fight this change tooth and nail. President Trump has the courage to go at it. Almost everyone in medicine has known about these unfair payments. However, past U.S. presidents have been afraid of the blowback from the powerful hospital lobby.

President Obama knew that this would drive physicians into selling their practices to hospital systems. The result is obvious. It would be easier to institute a single party payer system.

Evaluating the accuracy and usefulness of current national drug spending data.

Phase two;

  • Incentives for Lower List Prices Immediate Actions
  • FDA evaluation of requiring manufacturers to include list prices in advertising
  • Updating Medicare’s drug-pricing dashboard to make price increases and generic competition more transparent.

Further Opportunities

  • Measures to restrict the use of rebates, including revisiting the safe harbor under the Antikickback statute for drug rebates.

“The anti-kickback statute has been in place since 1971, but these specific safe harbors, protecting drug companies from anti-kickback laws, were introduced more than 2 decades ago.

The federal government provides an excellent resource for information about these safe harbors at the Federal Register website. It tells everything one needs to know about the opportunities for fraud and abuse in the current system. The website describes how the Trump administration plans to eliminate the government support of fraud and abuse.

https://www.federalregister.gov/documents/2016/12/07/2016-28297/medicare-and-state-health-care-programs-fraud-and-abuse-revisions-to-the-safe-harbors-under-the

In brief, the safe harbors define exceptions to situations where organizations are receiving “remuneration” for providing goods or services.

 A rebate given as an incentive to provide a drug (i.e., on formulary) or to utilize more of a product (i.e., “performance rebates”) would currently qualify for safe harbor protection.”

 

https://biosimilarsrr.com/2018/07/24/anti-kickback-safe-harbors-drug-rebate-contracts-biosimilars/

I will discuss this in more detail in the future. This is another act of courage by the Trump administration. It is also a common sense move to reduce the cost of healthcare in our dysfunctional healthcare system.

  • Additional reforms to the rebating system.
  • Using incentives to discourage manufacturer price increases for drugs used in Part B and Part D.

The high retail pricing of new drugs on the market must be control. Many of the new drugs are a reformulation of two old drugs. The reformulation does not change the effectiveness of either drug.

The retail price of drugs used to treat cancer must be controlled someway.

  • Considering fiduciary status for Pharmacy Benefit Managers (PBMs)
  • Reforms to the Medicaid Drug Rebate Program
  • Reforms to the 340B drug discount program
  • Considering changes to HHS regulations regarding drug copay discount cards

 Lowering Out-of-Pocket Costs Immediate Actions

  • Prohibiting Part D contracts from preventing pharmacists telling patients when they could pay less out-of-pocket by not using insurance
  • Improving the usefulness of the Part D Explanation of Benefits statement by including information about drug price increases and lower cost alternatives.

  Further Opportunities to Reduce Drug Costs to Consumers

 More measures to inform Medicare Parts B and D beneficiaries about lower cost alternatives

  • Providing better annual, or more frequent, information on costs to Part D beneficiaries
  •  Insurance Contract Reimbursement for Consumers’ Rx
  • Share of Manufacturer Rebates.
  • Consumers Payers Drug Manufacturer Pharmacies
  • Pharmacy Benefits Manager Formulary Agreement
  • Copayment Network Agreement
  • PBM Agreement Payment for Dispensed Drugs Formulary
  • Rebates & Other Fees Premium Drugs
  • Money Contracting Dispensed Drugs
  • Prime Vendor Agreement Shipped Bulk Drugs Payment for Wholesale Drugs Distributor
  • Payment for Wholesale Drugs Shipped Bulk Drugs Distributor Agreement

 

Most physician do not know about this complicated system. All they care about is taking care of the patients. It is time physicians understand how ancillary providers have been   ripping off the patients. Somehow, the ancillary providers manage to blame drug prices  on physicians.

Finally, we have an administration that not only recognizes the problems but is not afraid to fix them.

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



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The Main Reason Behind Rising Medical Costs

October 2, 2018
inMedicine: Healthcare System
• Leave a comment

Stanley Feld M.D.,FACP,MACE

 

President Obama and progressive Democrats such as John Kerry and Barney Frank wanted the healthcare system to become a single party payer system. Their problem was that they could not get enough votes in the house or senate.

https://youtu.be/f3BS4C9el98

 

 

https://youtu.be/-522hcm3woA

 

 

This goal for a single party payer by the progressives and Democrats must not be forgotten as the Trump administration tries to make a serious attempt to repair the healthcare system.

The Democrats and progressive will try to block this attempt at every turn.

All the stakeholders have played an important role in distorting the healthcare system  including the government, the healthcare insurance industry, the pharmaceutical industry, the hospital systems, the physicians and patients.

A starting salary for a starting hospital administrator is $250,000 a year. A starting salary for a pediatrician is $90,000 a year. Top hospital administrators are paid between five (5) million and fifteen (15) million dollars a year. Mature pediatricians make $150,000 to $200,000 a year.

Which professional adds more value to medical care? Physicians add more value to the medical care system. Hospital administrators do not understand why physicians resent them.

Physicians also resent hospital systems ripping off consumers with $50 aspirins and $100 sleeping pillows. Consumers who care about the cost of healthcare do not understand why the government and insurance companies let hospital systems charge these obscene prices.

Most physicians do not pay attention to these costs until they are patients.

All of the stakeholders except the government and patients try to optimize the amount of money they take out of the system. Surgeons are much further ahead of primary care physicians in figuring out their value to the healthcare system.

As a result of advances in technology, physicians figured out that 70-80% of the work-ups done requiring hospitalization 30 years ago could be done as outpatient care.

The brick and mortar value of hospital facilities has decreased.

As soon as hospitals realized this they started to build ambulatory surgical care facilities and outpatient clinics.  Hospital system procedures are more expensive than free standing outpatient ambulatory surgical care facilities.

http://stanfeld.com/hospital-mergers-dont-work/

Hospital administrators somehow convinced the government that if they formed hospital systems and merged hospitals in an area they would increase their efficiency and they could decrease costs.

At the same time the management of private practices became complicated as a result of government regulations. Expensive electronic medical records were required but did   not work as advertised. Overhead increased while reimbursement decreased.

Many physicians became disgusted managing their complicated private practices. Some physicians quit practicing early.

The hospital systems offered to buy private practices for a “reasonable cash price”, provide an electronic medical record, do the billing and management of the practice and hire and pay full time employees.

Hospital systems usually paid physicians under contract the same take home pay they had for two years. After the two-year contract expired the hospital systems offered new contracts depending on a physician’s productivity or fired the physician. Physicians had no say in the matter.

Physicians and surgeons signing with the hospital system did not consider the criteria to be used for determining salary after their contract expired .

This hospital arrangement seemed attractive to many primary care physicians and some surgeons. The growth of hospital owned physicians increased from 20% to 70% of physicians in a region.

Organized medicine, the AMA and physician specialty groups, did little to warn or educate physicians of these unforeseen consequences.

Hospital systems did their best to isolate private practicing physicians from using their hospital facilities.

The only private practice physicians who were not marginalized by the hospital systems were physicians who were needed by the hospital system for the services they performed. As soon as the hospital systems were able to hire physicians to cover those services the private practice physicians were marginalized.

Large hospitals systems are making deals with insurers that squelch competitive hospitals.

President Obama’s plan was to allow hospital systems to hide prices from consumers and corporations. The goal was to discourage use of less-expensive rivals. This tactic would force the less-expensive competition to join the regional hospital systems as affiliates.

 At first hospital systems did not grasp the ultimate significance of enlarging hospital systems. They figured merging hospitals would increase efficiency and decrease the cost of medical care.

They also thought owning physician practices would decrease their reliance on in-patient hospital billings and their brick and mortar structures.

During the Obama years there was a tremendous increase in building growth on the campus of most hospital systems.

I never understood the hospital building growth. More building meant more hospital administrators and more overhead. I thought the government must have created some economic incentive for hospital systems to build more buildings on campus.  I could not find the  incentives given to hospital systems.

As hospital systems merged all the hospitals in a region the hospital systems realized they had a monopoly on not only hospital services but also physician services.

They could negotiate with healthcare insurance companies from strength.

Initially the healthcare insurance companies were in control of the costs and services that were available. The healthcare insurance companies lost their control over cost to the regional hospital systems.

“Dominant hospital systems use an array of secret contract terms to protect their turf and block efforts to curb health-care costs. As part of these deals, hospitals can demand insurers include them in every plan and discourage use of less-expensive rivals. Other terms allow hospitals to mask prices from consumers, limit audits of claims, add extra fees and block efforts to exclude health-care providers based on quality or cost.”

There are hundreds of regional hospital system giants throughout the United States. In many cities there are two or three giant hospital systems. It is difficult for independents to negotiate contracts in these cities.

“The Wall Street Journal has identified dozens of contracts with terms that limit how insurers design plans, involving operators such as NewYork-Presbyterian, Johns Hopkins Medicine in Maryland, the 10-hospital OhioHealth system and Aurora Health Care, a major system in the Milwaukee market. National hospital operator HCA Healthcare Inc. also has restrictions in insurer contracts in certain markets.”

This is a very big deal.

The goal of the government should be to lower the price of healthcare to all of its citizens including seniors, workers who get insurance from their employers and people who do not have employer sponsored healthcare.

The Obama administration did nothing about stopping hospital system monopolies. In fact, it encouraged them.

“Certain hospital systems are able to command advantageous terms because they have grown through years of deal-making, shifting the balance of power between hospitals and insurers. In 2010, the year the Affordable Care Act passed, the annual number of hospital mergers shot up 40% to 59, and the number of deals has remained above 60 every year since, according to IrvingLevin Associates, a research firm that tracks health-care transactions.”

The Obama administration did nothing about it because the distortion in pricing is going to lead to collapse of the private segment of our healthcare system. Once the private segment of the healthcare system collapses a progressive government hungry to have power and control over the populous will install a single party payer system.

As proven over and over again, a single party payer system does not work. The government has to outsource all of the infrastructure to administrative services. The government does not control the administrative services overhead. Also, the government does not want to develop another uncontrolled and inefficient bureaucracy like the VA Healthcare System.

A single party payer system will lead to increases in unsustainable deficits and decreasing healthcare services.

It will take many years for the public to recognize that a universal single party payer system is inefficient. The government will hide the system’s inefficiency from the public.

The government should make common sense rules, enforce those rules and get out of  the healthcare administration business.

Medicare and Medicaid costs have not been recognized by the general public yet.

The VA inefficiency and lack of service by the VA Healthcare System has been recognized in the last two years by the general public. The government has assured the public that the VA Healthcare System is improving.

The insurance industry is trying to fight back.

“No hospital system should be able to exercise market power to demand contract agreements that prevent more competitively priced networks,” said Cigna’s chief medical officer, Alan Muney, in a written statement provided by the company.

The Trump administration is aware of all of these problems. President Trump is trying to figure out a way of negotiating a deal with all the providers who are taking advantage of consumers and the government. His administration’s actions have been delayed by the slow death of Obamacare.

If Obamacare was repealed last year I am sure the topic of hospital monopolies would be a hot topic of debate today.

President Trump is presently attacking the middlemen who have made drug prices so obscene. This is a big problem and an easier target.

“The effect of contracts between hospital systems and insurers can be difficult to see directly because negotiations are secret. The contract details, including pricing, typically aren’t disclosed even to insurers’ clients—the employers and consumers who ultimately bear the cost.”

Hospital contracts forbids healthcare insurance companies to cover many procedures that can be performed as outpatient services outside the hospital environment. I have listed some of the price differences between the more expensive outpatient hospital care facilities and the independent ambulatory care facilities.

There are many examples of how hospital systems rip off consumers and increase the cost of healthcare insurance for all including employers, individuals and the government. It is also decreasing the access to care for all.

If the government is really looking for a system that would work it should look at my Ideal Medical Saving Accounts are Democratic.

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



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Hospital Mergers Don’t Work

September 11, 2018
inMedicine: Healthcare System, Stakeholder Mistrust
• Leave a comment

Stanley Feld M.D.,FACP,MACE

This article appeared in Kevin M.D. several weeks ago. The article has some valid points. However, it misses the vital reasons hospital mergers are not working.

“In 2010, there were 66 hospital mergers in this country. Since the Affordable Care Act went into effect, the rate of hospital consolidation has increased by 70 percent.

By creating incentives for physicians and health providers to coordinate under accountable care organizations (ACOs), the ACA hindered the ability of regulators to block hospital mergers while incentivizing hospital consolidation.”

The government published reason for encouraging hospital mergers was to increase hospital efficiency and decrease healthcare costs.

I have said over and over again that the real goal of Obamacare was to have total control over the healthcare system. This control could be accomplished by controlling all the providers.

Hospitals realized that physicians controlled the utilization of hospital facilities. As knowledge and technology improved more and more diagnosis and treatment could be performed on an outpatient basis.

All the hospitals had to offer was a brick and mortar facility. Hospitals tried to stop physicians, before Obamacare, from developing their own outpatient facilities. The hospitals lobbied the government to require certificate of need for advanced outpatient technology (MRI, CAT scans, Outpatient Surgical facilities, and laboratories).

It did not work.

Obamacare provided incentives for hospitals to merge and consolidate into hospital systems.

Obamacare also provided incentives for hospital systems to create Accountable Care Organizations (ACOs). I have written about ACOs destiny to fail ad nauseum.

The government’s pretext was that hospital consolidation into hospital systems would increase efficiency with resultant decreases in hospital care costs.

The real reason was to get hospitals to hire physicians. At that point they would lower reimbursement on both. Hospitals and physicians would be totally dependent on the government.

“There is a growing body of evidence that hospital mergers lead to higher prices for consumers, employers, insurance and the government.”

 

The result is opposite the stated goal and was totally predictable.

 

“It is imperative to educate patients and lawmakers as to how the consolidation of hospitals and medical practices raise costs, decrease access, eliminate jobs and, ultimately, reduce care quality as a result.”

The development of hospital systems led to the expansion of administrative personnel which in turn led to increased administrative salaries and costs. Administrative costs are not government controlled. They are part of the overinflated hospital overhead.

In some cases, the government increased hospital systems’ subsidies because of increased administrative costs.

It did not lead to greater compensation to physicians they hired. Yet the hospital system was totally dependent on staff physicians for revenue production.

Physicians tended to work hard when they owned their own practice. Now that their salary was guaranteed they tended not to work 12-hour days.

Initially, hospital systems paid physicians on the basis of physicians’ previous productivity in their private practice. Additionally, physicians were given a payout for their practice. The payout was never the real value of their practice.

Hospital systems calculated the physicians’ productivity because the hospital system hired all the full-time employees. The hospital systems’ computer systems were also used in the calculation of productivity and overhead.

Hospital systems controlled the overhead and the books. A lot of the time the calculation was inaccurate. This was the result of two fees collected from the government and the insurance companies. One was a technical fee that belonged to the hospital system. The other was a professional fee for the physician.

At times, the professional fees were not collected and the physician groups could not figure out the discrepancy.

There had been a long-standing mistrust by physicians toward hospitals prior to Obamacare. The errors in calculations resulted in greater mistrust by physicians toward hospitals.

If a physician was not producing according to the hospital system’s calculation the physician, at the end of a usual two-year contract, was let go. This created more mistrust and suspicion among physicians toward hospital systems.

It has also caused physicians who anticipated this stranglehold by hospital systems to become concierge physicians or open outpatient clinics of their own.

This has caused hospital systems to provide concierge physicians of their own as well as hospital outpatient ambulatory surgical care clinics. The problem is that the free-standing physician owned ambulatory surgical care clinics (ASC) are more efficient and cheaper than the inpatient hospital care and the hospital’s own outpatient ambulatory surgical care clinics (HOPD). Some privately own ASC are cheaper than the increasing deductibles patients with private insurance have to pay using their insurance.

Below are some examples of Ambulatory Care Surgical Center fees as opposed to Hospital Owned Outpatient Surgical fees.

 “ASC – $1250 ($500 out of pocket)

HOPD: $4250 ($1000 out of pocket)

Echocardiogram:

ASC $500 ($200 out of pocket)

HOPD: $4250 ($1250 out of pocket)

Arthroscopy of Knee:

ASC – $3600 ($1070 out of pocket)

HOPD: $13,000 ($3900 out of pocket)

Hernia Repair:

ASC – $2500 ($750 out of pocket)

HOPD: $19,000 ($5700 out of pocket)”

There has been a dramatic increase in hospitals gobbling up independent providers and becoming powerful regional monopolies. These monopolies raise prices not decrease prices.

“According to a 2012 study by the Robert Wood Johnson Foundation, “the magnitude of price increases when hospitals merge in concentrated markets is typically quite large, most exceeding 20 percent.”

 

Forbes’ Avvik Roy of Forbes said, a presentation  in 2012.

“You have to get at the errors in public policies which drive the hospitals to merge.” He concluded that government must do more to fight consolidation among hospitals.”

The underlying theme is that President Obama wanted Obamacare to fail so it can be replaced by a single party payer system that has been pushed by progressives since 1935. Obamacare is moribund despite claims by Democrats. They refuse to face the fact that socialism does not work even thought it is a feel-good concept.

“A recent paper authored by Northwestern’s Leemore Dafny, Columbia’s Kate Ho, and Harvard’s Robin Lee provides some definitive proof that when hospitals consolidate, prices increase substantially. The effect is made worse directly in proportion to proximity of the merging hospitals. “If you are doing it because you think in the long run it will serve your community well, you should think twice,” Dafny said.”

Hospital systems are consolidating because they think it is in their vested interests to consolidate. They are falling right into President Obama’s trap. Hospital systems do not control productivity. Physicians control productivity.

A study published by the National Bureau of Economic Research, conducted by Zack Cooper of Yale University, Stuart Craig of the University of Pennsylvania, Martin Gaynor of Carnegie Mellon and John Van Reenen of the London School of Economics, sheds light on the real cost of reduced competition among hospitals: hospital prices are 15.3 % higher when a hospital had no competition compared in markets with four or more hospitals, amounting to a cost difference of up to $2000 per admission. Hospital prices are 6.4% higher in markets with two hospitals and those with three are 4.8 % more expensive when compared to markets with four hospitals.”

The American Hospital Association has been aggressive in criticizing those reports. It has funded a couple of critical reports  defending mergers and consolidations. The American Hospital Association doesn’t understand the progressives’ trap either.

It is backfiring already as hospital systems are saying they are losing money. The government is cutting reimbursement, the insurance companies are raising insurance rates and increased deductibles are unaffordable.  Consumers are experiencing a decreased access to care.

None of the policy makers are focused on the right problems because they want a single party payer system in order to gain total control over the healthcare system. Progressive have no interests in the cost of care, the need to raise taxes or the delivery of efficient care.

America is going to experience an economic disaster as it has been experienced in Canada, England and many other countries in the world.

Consumers are continuing to take it on the chin in other countries because 80% are not sick at any one time. Consumers in other countries feel secure with the guaranteed coverage even if it increases their taxes and decreases access to care.

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



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The Reason Congress Does Not Work

August 10, 2018
inPoliticians,Healthcare and Vested Interests, Stakeholder Abuse of the Healthcare System, Stakeholder Mistrust
• Leave a comment

Stanley Feld MD,FACP, MACE

I have wondered why either house of congress has not done anything about healthcare reform in the past 6 months.

The reason is that both the Democrat and Republican leadership in both houses of congress do not want to do anything about Repairing the Healthcare System.

On July 2, 2018 CMS released a report on the performance of the health insurance exchanges and the individual Obamacare health insurance markets.  

“Centers for Medicare and Medicaid Services Releases Reports on the Performance of the Exchanges and Individual Health Insurance Market.

Reports show individual market erosion and increasing taxpayer liability.”

The CMS conclusions for 2017 were obvious in 2016. Obamacare is on a downward spiral.

In 2017 87% of enrollees were subsidized as opposed to 83% in 2016.

There was an alarming 20% drop nationwide in enrollees in Obamacare’s individual healthcare market without federal premium subsidies.

223,000 subsidized enrollees dropped their subsidized insurance.

These Obamacare enrollees dropped their insurance because even with subsidies their premiums became too expensive. Their average monthly premiums of the subsided and unsubsidized groups spiked by 21%.

Unsubsidized Obamacare enrollment dropped an average of 33% nationally. It dropped an astonishing 73% in Arizona. It is a wonder that neither Arizona senator wants to do anything about Repairing the Healthcare System. It is also a wonder that Arizona citizens continue to support these senators.

Obamacare is dead!

The Democrats are naturally blaming its death on President Trump. President Trump does not want to pour more money into this failed concept while forcing a greater payment liability on taxpaying  Americans.  He wants congress to do something to repair the healthcare system.

President Obama’s plan all along was for Obamacare to fail and be replaced by a single party payer system.

I have written about 20 articles on why a single party payer system is unsustainable and will fail.

http://stanfeld.com/?s=single+party+payer

I am unable to insert links and videos properly. Please insert the links for both into your browser. It is important to understand how the rookie representative view how the government works.

The British National Health Services System is a failure. Single party payer systems close to home are a failure.

For example The VA Health System is a failure. Medicaid is an unsustainable failure. It is unsustainable while offering inefficient care.

http://stanfeld.com/?s=Medicaid+failure

Medicare is a failure because it is unsustainable by the government. Seniors like it because they can get care that they could not afford otherwise.

However, seniors are getting wise. Medicare is becoming unaffordable to seniors. The government construction of Medicare premiums for Part B, Part D and Part F are costing seniors somewhere north of $16,000 a year in post tax dollars.

Medicare used to pay 80% of its approved fee. The approved fee is about 50% of the physicians’ fees. In 2018 Medicare is only paying around 50% of its approved fee. Seniors have to pay the difference.

This will drive seniors out of the Medicare marketplace.

There is a better way. I have gone into excruciating detail describing the better way.

http://stanfeld.com/?s=My+Ideal+Medical+Savings+Account

Newt Gingrich, when he was house leader, said my idea was a BIG IDEA. However nothing ever came of the big idea. The “big idea” empowers the people not the government.

“Unlike many other politicians who have promised to take on the establishment and “drain the swamp,” Representative Thomas Massie (R-Ky.) 2012 is actually trying to do just that, and is taking some serious flak for his exposure of the Deep State and its agents on Capitol Hill.”

https://www.thenewamerican.com/usnews/politics/item/29426-in-the-swamp-fearless-reps-expose-the-corruption-on-capitol-hill?src=ilaw

If you click on the newamerican link above you will have all the videos in one article.

In a video series entitled The Swamp, Massie, along with Representatives Dave Brat and Tom Garrett of Virginia, Ken Buck of Colorado, Rod Blum of Iowa, and Ted Yoho of Florida, are showing people “what happens behind the scenes in Congress.”

To date, there are four episodes, each running about 10 minutes.

Besides pulling back the curtain to reveal the names and tactics of those who really pull the legislative levers in Congress, The Swamp videos make it very obvious that, although there are 435 members of the House of Representatives, the key decisions are made by a handful of very powerful leaders bent on controlling the country and that the betrayal is bipartisan.

The first video introduces these non establishment representatives’ chief complaint.

https://www.facebook.com/TheSwamp/videos/1794302460864573/

<iframe src=”https://www.facebook.com/plugins/video.php?href=https%3A%2F%2Fwww.facebook.com%2FTheSwamp%2Fvideos%2F1794302460864573%2F&show_text=0&width=560″ width=”560″ height=”315″ style=”border:none;overflow:hidden” scrolling=”no” frameborder=”0″ allowTransparency=”true” allowFullScreen=”true”></iframe>

<iframe src=”https://www.facebook.com/plugins/video.php?href=https%3A%2F%2Fwww.facebook.com%2FTheSwamp%2Fvideos%2F1794302460864573%2F&show_text=1&width=560″ width=”560″ height=”427″ style=”border:none;overflow:hidden” scrolling=”no” frameborder=”0″ allowTransparency=”true” allow=”encrypted-media” allowFullScreen=”true”></iframe>

An average of 4,500,000 people have viewed these videos.

“Representative Blum responded, “Most all the decisions around here are made by a few people at the very top, without the input of any other congressional members or U.S. senators. That’s not good representative government, wouldn’t you say?”

 “I think both parties are engaged in a quiet deal that we will support our base, and if it leads to bankruptcy, okay, and you will support your base, and if it leads to bankruptcy, okay,” Representative Buck says in Episode 1.

In Episode 2, the perception of a two-party system where the two parties oppose each other and want to achieve different ends is shattered as leaders of Democrats work with their Republican counterparts to shove a bloated, unconstitutional omnibus spending bill through the House without giving members time to read the text of the measure.

https://www.facebook.com/TheSwamp/videos/1807501746211311/

<iframe src=”https://www.facebook.com/plugins/video.php?href=https%3A%2F%2Fwww.facebook.com%2FTheSwamp%2Fvideos%2F1807501746211311%2F&show_text=0&width=560″ width=”560″ height=”315″ style=”border:none;overflow:hidden” scrolling=”no” frameborder=”0″ allowTransparency=”true” allowFullScreen=”true”></iframe>

“One of the most shocking revelations comes in Episode 3, when Rep. Massie details how the party forces members to pay “rent” for their committee assignments and chairmanships. If a congressman wants to sit on a committee, he is expected to raise a certain amount of money for the National Republican Congressional Committee, the body that works to elect House Republicans. There is an identical system on the Democrat side. In an interview, Rep. Buck told me this system has been in place for Republicans since the days of Newt Gingrich, and even longer for Democrats.”

https://www.facebook.com/TheSwamp/videos/1816800768614742/

<iframe src=”https://www.facebook.com/plugins/video.php?href=https%3A%2F%2Fwww.facebook.com%2FTheSwamp%2Fvideos%2F1816800768614742%2F&show_text=0&width=560″ width=”560″ height=”315″ style=”border:none;overflow:hidden” scrolling=”no” frameborder=”0″ allowTransparency=”true” allowFullScreen=”true”></iframe>

Episode 4 of The Swamp was released just a few days ago and covers the consequences faced by those lawmakers brave enough to buck the system and call out the conspirators.

https://www.facebook.com/TheSwamp/videos/1831877993773686/

<iframe src=”https://www.facebook.com/plugins/video.php?href=https%3A%2F%2Fwww.facebook.com%2FTheSwamp%2Fvideos%2F1831877993773686%2F&show_text=0&width=560″ width=”560″ height=”315″ style=”border:none;overflow:hidden” scrolling=”no” frameborder=”0″ allowTransparency=”true” allowFullScreen=”true”></iframe>

There you have it. This is the complex definition of The Swamp.

The structure has been created whereby our representatives and senators do not represent the will of the people.

Congress represents the will of the vested interests. Anyone that understands this has to play ball or move out.

It will be very difficult for America to get a sensible healthcare reform bill for the benefit of the American people when this pyramid of power exists.

It looks like legislation is driven by money, not the will of the people. These four videos are essential to understanding the process. They must be watched.

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



Copywrite 2006-2018

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President Trump’s Drug Plan Is On Target

June 7, 2018
inDisinformation and the healthcare system, Patients Problems, Politicians,Healthcare and Vested Interests
• Leave a comment

Stanley Feld MD,FACP,MACE

https://www.cbsnews.com/news/trumps-medicare-rx-blueprint-has-a-tricky-wrinkle/    

President Trump’s proposal for lowering drug prices to an affordable range is on target.

I have received a several requests asking me to explain the administrations plan. The “media is the message.” The traditional media has once again missed President Trump’s message completely. I suspect the traditional media has missed President Trump’s message on purpose because of their bias against the president.

The traditional media jumped on Trump’s plan as a non-plan aimed to penalize the middle class for the benefit of the pharmaceutical industry.

Either the traditional media hates Trump and his administration so much that they are against everything he does or they have not read his plan with an open mind because it has too many words in it.

It is pretty clear that Nancy Pelosi did not read President Trump’s drug plan or if she did she did not understand it. She said:

“This weak plan abandons the millions of hard-working families struggling with the crisis of surging drug prices.”

Nancy Pelosi’s statement is otter nonsense.

Her statement is reminiscent of the statement she made about Obamacare;

“You have to pass the plan in order to see what is in it.”

Any thoughtful Democrat should be ashamed that Nancy Pelosi is their leader.

I picked the coverage of only a few of the traditional media, CBS news, The New York Times and the Washington Post’s. All the progressive leaning media are really echo chambers of each other.

Each media outlet missed the Trump administrations’ point. They all are looking through their progressive lens. They believe the only plan that would work is a single party payer system controlled by the government.

They also see a tired public looking forward for the government to take over the complicated issue of healthcare. They have not interest is looking at the unintended consequences of a government takeover of the healthcare system.

A single party payer system will not work because public dependence on bureaucrats and politicians has never worked.

Simple examples are the VA Healthcare System and Medicaid. Government controlled health plans such as the VA system became too inefficient, costly, corrupt and unsustainable. The quality of care decreased and consumer choice and input has been eliminated.

People would never know what President Trump’s drug plan is all about it if they just read about it in the traditional media. If they made it easier for themselves and just read the headlines, as some of my friends have, they would know nothing about Trump’s drug plan.

One must listen carefully and read the source material.

President Trumps YouTube

https://youtu.be/Cds8h9DbTdc

This is the official outline document of the steps that need to be taken to fix the broken drug plan system.

CBS new got it wrong right off the bat.

http://www.cbsnews.com/trumps-medicine-rx-bluprint-has-a-trickly-wrinkle/

“The Trump administration’s “Blueprint” to lower drug prices and reduce patient costs made one thing clear: The government will not directly negotiate with drug companies to secure lower prescription prices. But that doesn’t mean it isn’t proposing changes that would dramatically alter the way Medicare pays for some of the most expensive drugs, and in the process, potentially raise out-of-pocket costs for some of the country’s sickest patients.”

CBS News then brings up an issue that part of President Trump’s solution. The news agency criticizes the administration before it knows the administration’s solution.

A cornerstone of the Trump plan calls for all Medicare drug payments to be consolidated under Medicare Part D, the prescription drug plan for Medicare enrollees administered by private insurers. Under Part D, insurers and middlemen known as pharmacy benefit managers (PBMs) negotiate with drug companies for discounted prices in exchange for the drug companies’ products being included in the PBMs’ list of covered drugs.

But drugs intravenously administered in physicians’ offices, such as chemotherapy and vaccines, are usually covered as a medical treatment under Medicare Part B. Physicians buy these drugs directly from manufacturers, and Medicare reimburses doctors for the drugs’ average sales price plus 6 percent.

A perfect example is the yearly flu shot. Most flu shots are given at local pharmacies and supermarkets for Medicare patients’ convenience.

Medicare Part B pays $120 for a $15 injection dose. How is that for a colossal waste of Medicare dollars?

Pharmaceutical companies are against the idea, partly because they generally are paid more under Part B than Part D.

Alex Azar, Health and Human Services secretary and former president of the U.S. division of pharmaceutical giant Eli Lilly (LLY), has been touting the move to consolidate Medicare drug payments.

“Bringing negotiation to Part B drugs is such a potent way to bring down prices that PhRMA is already protesting the idea,” Azar said in a recent speech at the American Enterprise Institute in which he referred to the drug industry trade group called Pharmacuetical Research and Manufacturers.

Nonetheless, CBS points out a potential paper tiger to leave the message that the plan is no good. The “media is the message” even if it is a lie.

“But Azar and others have shed little light on exactly how this change would take place, leaving patients worried about the potential for astronomically higher out-of-pocket costs”.

The plan is there. CBS news has not read the plan.

“Medicare Part B presently creates incentives for doctors to purchase more expensive drugs to get a higher dollar profit”

This is a negative incentive that the President promised to eliminate. Physicians to not profit from higher drug prices. In the case of the flu shots pharmacies and supermarket pharmacies administering the flu shots profit.

“Azar said; it will create incentive for insurance companies and PBMs in Medicare Part D to negotiate discounts and lower prices and pass them on to patients.”

President Trump said he promises to eliminate the extreme profit the pharmacy benefit managers take from the system.

The New York Times took a different negative slant in order to criticize Present Trump.

“President Trump has the power to sink pharmaceutical stocks with a single jab about high drug prices.”

“But in a much-anticipated speech on the topic on Friday, Mr. Trump largely avoided the issues the industry fears the most, such as allowing Medicare to directly negotiate drug prices, or allowing Americans to import drugs.”

President Trump’s plan is to force pharmacy benefit managers to negotiate the best price for Medicare and patients with private insurance in a free market system and not in a government controlled system.

The government negotiates much lower drug prices for itself in the military and VA systems. The drug companies just cost shift and charge the rest of us a higher price

“Investors noticed: Stocks of major drug companies rose after his speech, as did those of pharmacy benefit managers, or the “middlemen” that Mr. Trump said were getting “very, very rich.”

Last weekend I asked a retired friend what he thought of the Trump plan. He said President Trump is going to make the drug companies and the pharmacy benefit managers very, very, rich.

This is regurgitation of the NY Times coverage from a well-educated man. The media is the message!

 

Time Magazine coverage was no better. It, too, was anti-Trump. Time Magazine did not bother to understand that the Trump drug program is a free market system without cronyism.

“ President Donald Trump’s long-promised plan to bring down drug prices would mostly spare the pharmaceutical industry he previously accused of “getting away with murder.” Instead he focuses on private competition and more openness to reduce America’s prescription pain.”

Why can’t the media discuss the facts and let us decide what will work or not work? What is wrong with competition? It works. Government control doesn’t seem to work.

“The administration will pursue a raft of old and new measures intended to improve competition and transparency in the notoriously complex drug pricing system.”

“But most of the measures could take months or years to implement, and none would stop drug makers from setting sky-high initial prices.”

I believe the public is starting to see how the traditional media does not want to understand President Trump’s proposal or how President Trump is going to execute on his promises.

“Trump called his plan the “most sweeping action in history to lower the price of prescription drugs for the American people.”

“But it does not include his campaign pledge to use the massive buying power of the government’s Medicare program to directly negotiate lower prices for seniors.”

Actually President Trump’s drug plan does use the massive buying power of the Medicare program to negotiate lower prices for seniors. He is doing it indirectly but through a free market system.

The traditional media’s prime focus is to criticize President Trump’s programs regardless of the facts.

In fact, with his drug plan, President Trump has published a blueprint that is going to change the metrics of how drugs are priced. His plan will make prices transparent to patients and physicians.

Patients will be given the choice to pick the best price. Physicians will be given the choice to decide if the price charged for new medication is worth the increase in price.

President Trump is going to eliminate the present failed system of pricing medication. It has not worked for consumers.

His blueprint cannot be evaluated in the context of the present pricing system.

I will describe the potential for improving the system with his blueprint in my next article.

All I can say at this point is let us see what is going to happen.

 

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



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