Stanley Feld M.D.,FACP,MACE

Once again, President Obama is being disingenuous. He told the nation’s governors he was willing to amend his healthcare reform act. He said he would give states the ability to opt out of its most controversial requirement the mandate for citizens to buy insurance in 2014.

Last week he started his speech by spinning his charm at the National Governors Association meeting by saying:

“I am aware that I have not convinced everybody here to be a member of the Affordable Care Act fan club,"

He said he understood that the majority of the public were not members of the Affordable Care Act fan club either.

He did promise “to give states the power to determine their own health-care solutions.” His qualifications to state power are the deal breaker.

President Obama’s qualifications to state power change in his healthcare reform act as it relates to Medicaid are:

1. The Administration retains the power to decide which states deserve a waiver.
2. The state would still need to cover the same number of uninsured.
3. Its coverage would still need to include the same comprehensive benefits.
4. It must be as "affordable" as determined by the Administration.
5. States could opt out of some consumer or employer mandates. This is a minor concession.
6. In reality, his conditions leaves no room for the states to innovate.
7. Innovations such as;
   1. Straight tax deduction or credit to purchase individual coverage.
   2. Alternative insurance designs such as;

              i. The high-deductible ideal medical savings accounts,

              ii. Plans that can be bought across state lines.

1. Even if the change was approved, it could be difficult for states to meet the federal requirements for the waivers.

Mr. Obama also asked the governors to come up with a bipartisan group to find ways to reduce Medicaid costs. There is no way to reduce Medicaid costs under the structure of President Obama’s healthcare reform act. The structure is defective.

President Obama must have stayed up all night trying to figure out ways to fake out the State Governors. President Obama is trying to reposition himself to the political center issues in the wake of the drubbing his party took in the November midterm elections. This proposal will not do it.

He has once again used smoke and mirrors.

This is not a shift. The mandate in particular is under fierce attack in the courts, where federal judges have issued conflicting opinions on its constitutionality. The mandate is also a rallying cry for conservatives and Tea Party supporters, who regard it as a prime example of overreaching by the federal government.

President Obama will not allow states to cut Medicaid rolls to ease their fiscal distress.

President Obama said. “I am not open to refighting the battles of the last two years,” he said, “or undoing the progress that we’ve made.”

Gov. Rick Perry of Texas, chairman of the Republican Governors Association said. “Pretty much all he did was to reset the clock on what many of us consider a ticking time bomb that is absolutely going to crush our state budgets. The states need more than that.”

Indiana’s Mitch Daniels and 20 other Governors recently wrote to President Obama requesting a genuine relaxation of the waiver standards. He has also asked for states to have the ability to be innovative and control each individual Medicaid program.

"Healthy Indiana" the Medicaid reform Governor Daniels initiated in Indiana is run because of special federal permission. The program has been a huge success. Federal support for the program is about to disappear.

The Health and Human Services(HHS) department does not like the Healthy Indiana program because it features health savings-like accounts. Healthy Indiana decreases federal control over the Medicaid system in Indiana. The program puts the healthcare dollars under patients’ control.

‘The reality is that the liberals who wrote this bill really do think they have a monopoly on good ideas, and they do not include markets. Democrats are more than happy to give the states more freedom, as long as the states use it to impose comparable government control.’

That may be why we hear that White House health staffers Stephanie Cutter and Nancy-Ann DeParle have been privately telling liberal interest groups that this is a way to increase centralization—for instance with a state-based "public option" or even single payer.

President Obama’s “flexibility” is a shame. He is telling the states you can do anything you want. However, you must do what we want you to do. We will determine what we will approve.

The list is defined arbitrarily by unelected bureaucrats and a non- congressional approved head of CMS (Don Berwick) who refuses to answer any congressional questions directly.

I believe President Obama wants the healthcare reform act to fail. He wants the federal government to get complete control over the entire healthcare system.

He is stalling for time with his most recent tactic. It is essential to him to get all new 256 agencies up and running. Then it will be difficult to close down new agencies.

I hope the state governors are not faked out by his charade.

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

Stanley Feld M.D.,FACP,MACE

Prior to the passage of his healthcare reform act President Obama removed a provision dealing with reimbursing physicians for end of life counseling. There had been a great public uproar over this provision.

It was viewed at a first step toward end of life rationing of care. It was really a signal that most care would be rationed.

When a proposal to encourage end-of-life planning touched off a political storm over “death panels,” Democrats dropped it from legislation to overhaul the health care system.

Sarah Palin called it death panels.” A government panel would decide whether Medicare would pay for the treatment of patients deemed hopeless regardless of the patient’s will.

Sarah Palin’s use of “death panels” was sensationalistic. In our sound bite society this was an effective sound bite.

The words “death panel” illustrated the truth about a world of finite resources and infinite entitlements.

The government cannot afford entitlements much longer. Yet President Obama’s healthcare reform act is going to expand the Medicare and Medicaid entitlements.

President Obama plans to control entitlement spending by defining what he will pay for. The result will be rationing of care.

There are other ways out of the mess. President Obama is not attacking the root of the problem. One way is a consumer driven healthcare model using ideal medical savings accounts. It would place the responsibility on patients and their family. Patients would be in a position to choose rather than having the third party (the federal government) choose their medical care. Patients and their family might decide to limit hopeless care when they are spending their own money..

A system of sensible tort reform would decrease the large cost of defensive medicine. The result would be lower healthcare costs. President Obama has ignored tort reform.

These two changes can help attack a few of the root causes of the increasing healthcare costs.

I have objected to President Obama’s healthcare reform act. It places all the decision making power in the executive branch and out of the hands of congressional oversight.

The Obama administration has the power to effect change through regulation rather than legislation . An example is Dr. Donald Berwick, chief of CMS, instituting the same policy by regulation that was removed from the bill by legislation. The new regulations go into effect January 1 2011.

At a stroke, Medicare chief Donald Berwick has revived the "death panel" debate from two summers ago.

CMS will enact the same policy removed from the bill through regulation. Congress has had no input. There will be a never ending series of steps to give government control over both patients’ and physicians’ freedom to make medical decisions. Some regulations seem benign on the surface. President Obama has been given complete control over the healthcare system by his healthcare reform act.

It is the reason there is such an outcry to repeal his healthcare reform act. President Obama has tried to hide the new regulations from stakeholders involved.

“The office of Oregon Democrat Earl Blumenauer, the author of the original rider who then lobbied Medicare to cover the service, sent an email to supporters cheering this "victory" but asked that they not tell anyone for fear of perpetuating "the ‘death panel’ myth." The email added that "Thus far, it seems that no press or blogs have discovered it, but we will be keeping a close watch."

President Obama has used a number of tricks to achieve his goal. He appointed Dr. Berwick during congressional recess without congressional hearing after he withheld the request for a congressional hearing and approval for 3 months.

Dr. Berwick now slips through a regulation about reimbursement that Congress explicitly rejected. The email slipped out illustrating the scheming with his political patrons to duck any public scrutiny.

“Expect many more such nontransparent improvisations under the vast powers ObamaCare handed the executive branch.”

Administrative spokesmen, when challenged, immediately declared “the rule-making is not coercive and gives seniors more autonomy, not less.” Nothing could be further from the truth.

The facts are a panel of medical experts decide on treatments or service that are worthy of reimbursement. They then tell the administrators what to pay for. Some treatment won’t be paid for it even if it is in the best interests of patients.

Can a panel of medical experts be wrong? They certainly can. The experts judgments might be correct. However, their opinion and exceptions to the regulations cannot be incorporated into the healthcare system by inflexible bureaucratic machinery.

The bureaucrats put the experts’ decisions into a rules based computer program. Reimbursement is driven by this inflexible system , not by medical circumstances or medical judgment.

Last month a group of Clinical Endocrinologists received a Medicare denial code 151 stating;

“Payment adjusted because the payer deems the information submitted does

not support this many/frequency of services.”

This had not happened to this group in 20 years of endocrine practice. It concerned serially measuring thyroid function to regulate thyroid replacement therapy after patients are rendered hypothyroid with radioactive iodine of surgery. Initially patients have to be followed with thyroid function testing every month or two.

“Medicare allowed payment for the first laboratory service, then denied the next three tests as “too frequently.”

CMS also describes in its National Coverage Determination (NCD).

Thyroid testing may be covered up to two times a year in clinically stable

patients; more frequent testing may be reasonable and necessary for patients

whose thyroid therapy has been altered or in whom symptoms or signs of hyperthyroidism

or hypothyroidism are noted.

The “medical experts” got the exceptions correct but did not define the frequency of testing to permit the CMS to incorporate into the reimbursement system..

An endocrine practice can submit for redetermination within 120 days. If redetermination fails physicians have 80 days to file for reconsideration.Reconsiderations are the second level in the appeal process and are conducted by the Qualified Independent Contractors (QICs). If physicians receive an unfavorable reply at the reconsideration level, there are three more levels of the appeal process, the Administrative Law Judge (ALJ) Hearing, Appeals Council Review and the Judicial Review in U.S. District Court.

Imagine all the costs involved on both sides in order to adjudicate treatment that is evidence based and totally indicated. Imagine the frustration of physicians treating patients. .

From past experience these hassles will increase as the government gets more and more control over the healthcare system. Patients’ medical care is not first. Federal rules and regulations are first.

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

Stanley Feld M.D.,FACP,MACE

Ann Braly’s ( CEO of WellPoint), article in the Wall Street Journal on February 7,2007 signaled an aggressive campaign by the healthcare insurance industry to force the federal government to subsidize healthcare insurance even more than it is presently.

The healthcare insurance industry wants the passage of Obamacare with the deal President Obama made with them. Part of the deal was to mandate insurance and increase deductibles from 20% to 30%.

“This scheme presented by Obamacare would have been, and might still be, imposed on the rest of the country.”

The original scheme (Obamacare1) was forced to be modified because mandating healthcare insurance was challenged as being unconstitutional.

Thirty two states have passed laws prohibiting healthcare insurance mandates. Mandates would be great for the healthcare insurance industry. They would increase the number of customers insured.

The more insured the lower the actuarial risk. The healthcare industry claims it could lower the cost of healthcare insurance. Obamacare 1 would also increase consumers’ deductibles saving more money for the healthcare insurance industry and increasing the burden to consumers.

At the request of several congressmen last year, including some Democrats, WellPoint mined its own actuarial data to model ObamaCare and found that it would as much as triple premiums for the small businesses and individuals who are most of the company’s customers.

WellPoint is declaring that Obamacare 2 will triple premiums. It is important to note that WellPoint did the math using accounting practices permitted by the government. The result is loading the overhead.

There is no evidence that any congressmen or the President has challenged WellPoint’s estimates until Mrs. Braly’s WSJ interview. No one has challenged the accounting methodology. The government is assuming the healthcare insurance industry numbers are correct. It would also be important to understand the math in the actuarial estimates.

The government should be looking at the defects in accounting methods. It should also look at the accuracy of the actuarial calculation.

“The White House political shop promptly compared WellPoint to a tobacco company.

President Obama uses political sound bytes all the time. His sound bytes have little substance. He should become aware of the fact that the average citizen is tired of his nice sounding rhetoric.

The healthcare insurance industry is ripping off the consumer and the government. The government should make the right accounting rules, incentivize the consumer and physicians to decrease the cost of healthcare and get out of the way.

Four days after Mrs. Braly’s statements about premium increases, Anthem, a California subsidiary of WellPoint, announced it was increasing its insurance premium by 39% for individuals insured.

I knew it would not stop at Anthem in California. The healthcare insurance industry is exempt from antitrust laws. I predicted that WellPoint’s argument is paving the way for other healthcare insurance companies to increase its rates.

“For example, Anthem in Maine was denied an 18.5 percent increase last year and is now requesting that state regulators approve a 23 percent rise.

Michigan’s Blue Cross Blue Shield plan requested approval for premium increases of 56 percent in 2009. And in the state of Washington, rates for some individual health plans increased by up to 40 percent until regulators cracked down.

Other states cited in the report were Connecticut, Oregon and Rhode Island.

The premium increases affect the most vulnerable part of the health insurance market, policies marketed individually to customers buying their own plans.”

The goal of WellPoint is to raise the rates on individual plans which have patients at risk for using healthcare insurance. Its position is the government should pay for the risk and that is the deal they made with President Obama before he changed the deal.

“According to the Census Bureau, only about 9 percent of Americans purchase coverage directly, while nearly 60 percent are covered under employer plans. Family premiums for those with workplace coverage rose 5 percent last year, even as inflation fell 1 percent, but nowhere near the rates seen in the individual market.”

The mandate to the healthcare insurance industry is they must accept all employees regardless of pre existing illness in group plans. They can raise the rates of group plans depending on the demographics of the group rather than community rate the group. Community rating should add a community pressure point to individuals that do not take care of their health.

Older self employed individuals cannot qualify for healthcare insurance under present healthcare insurance company rules. Even if they qualify for insurance these consumers have to pay for insurance with after tax dollars. The existing rules decrease individuals’ ability to afford healthcare insurance.

On top of that the insurance industry demands unconscionable premium increases. The solution is for State Insurance Boards to refuse to grant these companies a license to sell insurance in their state.

Another solution should be making healthcare insurance tax exempt just as employer insurance is tax exempt. Obamacare wants to make all insurance payments non tax exempt to increase government revenue while placing a bigger burden on individuals and groups.

The healthcare reform bill should change the rules so that all insurance is community rated and everyone is qualified to buy insurance regardless of preexisting illness. The bill should create ideal medical savings accounts for everyone so they become responsible for their own health and healthcare dollars.

“Insurers say the push for higher premiums reflects supply and demand. Medical costs keep going up, even in a weak economy. Many healthy people are dropping coverage or switching to bare-bones policies to keep their bills down. That leaves a higher proportion of people with health problems in the risk pool, forcing the steep rate increases.”

This is the reason to start from scratch with the Ideal Medical Savings Account. Medical Savings Accounts are an insurance product Democrats refuse to consider. It will decrease the power of the federal government’s ability to keep the citizens in a state of fear and them in power. (Shock Doctrine).

It is time for us to say we are not going to take this anymore.

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

Stanley Feld M.D.,FACP,MACE

I am a big fan of Peter Senge’s “The Fifth Disciple”. President Obama’s healthcare reform bill is not solving the underlying systemic problems in the healthcare system. It may bring him fame and glory in the short term. It will be a financial disaster in the long term as many entitlement programs have been.

Peter Senge’s wrote (page 61);

“ The long term, most insidious consequence of applying non-systemic solutions is increase need for more and more of the solution.

This is why ill-conceived government interventions are not just ineffective, they are “addictive” in the sense of fostering increased dependency and lessened abilities of local people to solve their own problems.

The phenomenon of short term improvement leading to long term dependency is so common, it has its own mane among systems thinkers- it’s called “Shifting the Burden to the Intervenor.”

The intervenor may be federal assistance to cities, food relief agencies, or welfare program.

All “help” a host system, only to leave the system fundamentally weaker than before and more in need of further help.

Please consider Peter Senge’s concept as it relates to President Obama’s healthcare reform bill. His bill ignores or proposes the wrong solutions to the five most important systemic dysfunctions in the healthcare system.

The five most important systemic dysfunctions are:

1. Excessive defensive testing.

Effective malpractice reform would correct this problem

The partial cost of defensive medicine extrapolating the Massachusetts Medical Society survey is at least $75 billion dollars a year. If extrapolated to all medical specialties the cost is in the range of $300 billion dollars a year. The cost excludes time wasted and the stress to both the physicians and patients.

1. Healthcare insurance industry’s abuse of the system.

Real healthcare insurance reform is needed as described previously. The ideal medical savings accounts, as opposed to health savings accounts or the present healthcare insurance product would eliminate bureaucratic ineffiency and put consumers in control of their healthcare dollars.

Patients must be incentivized to conserve their healthcare dollars and be responsible for maintaining their own health and well being

1. Administrative services accounting abuse.

The elimination of the abuse and waste by the healthcare insurance industry is necessary. This can be achieved by effective accounting regulation reform for reporting Medical Loss ratios. The Medical Loss ratio accounting abuse adds little value to patient care.

At the same time the regulations for the healthcare insurance industry exemption from antitrust laws should be eliminated.

1. A lack of efficiency in the physicians’ offices.

The elimination of administrative waste and paper work in physicians’ offices by creating a completely functional and effective electronic medical record in the “cloud” is needed.

The installation, updating and use of the ideal electronic medical record should be simple, customizable and inexpensive. The electronic medical record should t fit the physician’s work flow. Physicians should be charged by the click.

Physicians should not be expected to make large capital expenditures for electronic medical record systems that might not be totally functional and then be financially responsible for upgrading to improve functionality.

President Obama’s proposed system for implementing the electronic medical record will only delay adoption and functionality needed to reduce the cost of healthcare.

1. A lack of chronic disease self-management tools.

Systematic educational programs for patient self care and management of chronic diseases must be developed for all physicians. These chronic diseases include diabetes mellitus, chronic lung disease, asthma, hypertension, coronary artery disease, certain gastrointestinal diseases, osteoporosis, and arthritis.

Internet information sources can be constructed within physicians’ ideal electronic medical record. The information sources can be customized to the physicians’ office to educate patients. It must be constructed as an extension of a physician’s care. All of the instructional information is presently on the web. The trick is for physicians to pick appropriate sites with information that will be an extension of the physician’s care. Physicians have to have incentive to do this easily.

Along with cancer the complications of these chronic diseases consume 80% of the healthcare dollars paid to hospitals and physicians. The complications of these chronic diseases can be decreased by 50% is systems of self-management are developed. If the costly complications of these chronic diseases decrease healthcare spending can decrease by at least 50%.

If healthcare reform concentrated on these five areas, with a minimum increase in governmental bureaucratic agencies, America would be well on the way to placing control of the healthcare system in consumers’ hands. Consumers would have the incentives and freedom to choose. Consumer driven healthcare would force hospitals and physicians to either shape up or perish.

Government should make the rules, then get out of the way. Consumers must be empowered choose and be responsible for their own care. Consumers will drive the medical costs down.

Consumers have shown, in many areas of our economy, that they have the power to make efficient and wise decisions. We have only to look at the auto industry, the supermarket industry, the telecommunication industry, and the airline industry to realize that consumers are not dumb.

The government can make effective rules for the healthcare industry and let the consumer drive the healthcare system.

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