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All items for January, 2008


Health Care Up to Public, Edwards Says – Part 1

Stanley Feld M.D.,FACP,MACE

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

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

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

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

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

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

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

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

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

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

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Are Patients Smart Enough To Make Their Own Healthcare Choices?

Stanley Feld M.D.,FACP,MACE

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

And who is going to be able to remedy this?

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

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

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

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

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

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

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HillaryCare v. Obama – Part 3

Stanley Feld M.D.,FACP,MACE

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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Clinton, Obama Clashing On Healthcare – Part 2 Democrats Debate Requiring People To Buy Coverage

Stanley Feld M.D.,FACP,MACE

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

Instead they fight over relatively insignificant issues.

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

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

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

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

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

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

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

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

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

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

The debate about healthcare is entertaining but shallow and negative.

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

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

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

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

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

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

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

  • charlesclarknovels

    I plead with candidates: don’t try a band-aid cure for the dying healthcare system. I won’t work! You have to dig into the causes and take action to restructure the entire program by eliminating the causes regardless of how unpleasant it might be to the lobbyist of the AMA, Health Insurance Industry, and the Pharmaceutical Industry.
    A start would be to take steps to deny reimbursement for unnecessary surgical procedures and unnecessary diagnostic testing.
    Is there a candidate who will step up and take the heat that goes with change? I think not.

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Clinton, Obama Clashing On Healthcare – Part 1: Democrats Debate Requiring People To Buy Coverage

Stanley Feld M.D.,FACP,MACE

Sen. Hillary Rodham Clinton is on the attack against her main rival, charging that Sen. Barack Obama’s health plan would leave millions of Americans without medical protection while hers provides coverage to all.”

The real issue should be that everyone should be the able to purchase healthcare insurance if they want to. It should not be mandated with a penalty. There should be no restriction on eligibility. Everyone should be able to purchase healthcare insurance with pre-tax dollars. The government should subsidize the less fortunate on a means tested basis. Everyone should own their healthcare dollar. Everyone should have financial incentives to use their healthcare dollar wisely.

Patient education is critical for the prevention of the complications of chronic disease.Patient education should be adequately compensated. Patient education programs to teach patients to use their healthcare dollar wisely should be available on the internet.

Consumers can force the healthcare insurance industry to compete for their healthcare dollar. If real price transparency was required for hospital systems and physicians, both would be forced to compete for the consumers’ healthcare dollar.

With consumer driven healthcare, the market economy would force the healthcare insurance industry to become more efficient. It would decrease its 150 billion dollars in administrative costs.
Consumer driven healthcare would also stimulate hospital systems and physician groups to deliver more efficient medical care. Both groups would be interested in eliminating administrative waste through the use of information technology. The consumer must be the primary driver of the healthcare system, not the government nor the healthcare insurance industry.

Consumer driven healthcare would create a more orderly evolution toward the adoption of information technology rather than the punitive administrative rules and bureaucratic inefficiency advocated by Gingrich and Kerry in their E-prescriptions article.

I have mentioned that it costs a physician $7 to pull a chart from his filing racks. It costs another $15 to complete the chart. The use of the ideal electronic medical record would decrease this cost to pennies. In turn, it will decrease the physicians costs to deliver medical care which would reduce fees.

If an innovative software company provided universal software to physicians and hospital systems and charged physicians and hospital systems by the click, we could eliminate the burden of start up costs and capital expenditure.

Hospital systems’ pharmaceutical charges and bed charges should be based on its cost plus a reasonable profit.

Healthcare premiums must be community rated and available to all with pre-tax dollars and subsidies if necessary. Consumers electing not to purchase healthcare insurance would be responsible for the retail charges. This might create incentives for those would choose not to take advantage of the universal coverage opportunity.

Incentives should be given to physicians to develop patient education services to prevent the complications of chronic diseases. All the presidential candidates are ignoring the fact that 80-90% of the healthcare dollars are spent on the complications of chronic disease.

Hillary Clinton’s assertion, flatly rejected by the Obama campaign, rests on a pivotal difference between the two Democratic presidential candidates’ health proposals. Clinton says she wants the government to require all citizens to buy insurance or face a penalty. Obama relies on a mandate for children only, and instead emphasizes ways to make coverage more affordable.”

I believe the basic difference between Hillary and Obama is Hillary thinks you have to force people to do things and Obama thinks you have to provide the environment and incentives to get people to do things. Obama has more respect for our intellect than Hillary does. However, both candidates are advocating systems that will fail. After they fail the next step is universal coverage by a single party payer. The single party payer will be a disaster for America.

“ The seemingly technical distinction has launched an impassioned debate among economists, health care analysts and politicians, and has fueled a key campaign argument in early-voting states such as Iowa. It will likely receive more attention as the election season grinds ahead.”

Here we go again. The media seeks openings to make the election a spectator sport. Americans want serious discussion of the issues and well thought out solutions.

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U.S. Curtailing Bids to Expand Medicaid Rolls

Stanley Feld M.D. FACP,MACE

We have seen how inadequate the standards for eligibility for Medicaid are. The definition of poverty is inappropriate. The Bush administration talks a good game about our obligation to help the less fortunate. However his actions toward the less fortunate are not consistent with his words. Medicaid is a single party payer with poor benefits for patients and poor reimbursement for providers.

President Bush has vetoed the S-CHIP proposal twice. “The president had promised to veto it, saying the Democratic bill was too costly, took the program too far from its original intent of helping the poor, and would entice people now covered in the private sector to switch to government coverage.”
“Bush argued that the congressional plan would be a move toward socialized medicine by expanding the program to higher-income families.”

On one level the President is correct. It will expand another inefficient and ineffective bureaucracy (Medicaid). Medicaid needs to be restructured not expanded. The decisions for medical care will not be in the hands of the patients or the physician.

On the other hand people who can not afford healthcare insurance will not have healthcare coverage in are present system. The solution is not to expand the present single party payer system. The solution is to construct an effective system.

“Senate Majority Leader Harry Reid, D-Nev., decried Bush’s action as a “heartless veto.””

The basic principle in my concept of Repairing the Healthcare System is making patient responsible for their healthcare and healthcare dollar. A proactive consumer will create the market force environment needed to compete for the consumers’ healthcare dollar. This can be accomplished with my Ideal Medical Savings Account for employers, self employed and subsided needy. Our less fortunate citizens can be subsided on a sliding scale using a realistic means test.

Everyone would own his healthcare dollar and be responsible for its wise use. If people avoided the complications of chronic diseases they would receive a financial reward in addition to the reward of good health. The mechanisms for education and chronic disease management have to be supported financially. Financial incentives are effective.

Instead, neither President Bush nor his administration is thinking. They are not coordinating some of the good ideas for the repair of the system. He is focused on the enemy (the Democrats) and their attempt to sneak socialized medicine in through the back door.

S-Chip and Medicaid could be set up to avoid socialized medicine. Presently the government is the single party payer for S-Chip and Medicaid.

The new system should focus on insurance companies competing the patients’ healthcare dollar. The government should make the rules and then get out of the way. The government should enforce the rules in favor of the primary stakeholder the patient.

This is should be the focus of the presidential policy debates and not the issue that President Bush is heartless. The present bureaucratic institutions are heartless as demonstrated by the story of Moises and Medicaid. .

On the other hand, governors of many states are starting to understand that there has to be some effective benefits for the hard working less fortunate. We have seen the effort Mayor Bloomberg is making to redefine poverty to distribute aid more fairly and efficiently in New York City. We have seen the attempt that the State of Indiana is making. These are innovative. The problem in Indiana is the program is imbedded in the present system.

Rather than encouraging the development of these ideas the Bush administration seems to be doing everything it can to discourage innovation much to my disappointment.

“ The Bush administration is imposing restrictions on the ability of states to expand eligibility for Medicaid, in an effort to prevent them from offering coverage to families of modest incomes who, the administration argues, may have access to private health insurance.”

“The restrictions mirror those the administration placed on the State Children’s Health Insurance Program in August after states tried to broaden eligibility for it as well.”

Until now, states had generally been free to set their own Medicaid eligibility criteria.
The federal government is ignoring the threat the less fortunate pose to the local communities. The Bush administration should be able recognize the threat of terrorist activities and crime by the less fortunate from incidents the administration has seen worldwide.

On Dec. 20, the Bush administration rejected a proposal by Ohio to expand its Medicaid program to cover 35,000 more children. Ohio now offers Medicaid to children with family incomes up to twice the poverty level, or about $41,000 a year for a family of four. The state had proposed increasing the limit to three times the poverty level, to about $62,000.”

As I have said over and over again the only thing that is going to be able to fix the system is consumer demand. In this Primary Season for presidential nominees we hear how powerful we the voters are. We should be demanding and debating the details of how they are going to fix the healthcare system rather than judging their sound bites

The Clinton and Obama race is fun to watch. Both candidates have created a smoke screen obscuring the eventual outcome of their pronounced policy on healthcare. Their resulting socialized medical system will intensify the dysfunction and cost of our healthcare systems.

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Health Savings Accounts For Poor Tested: Another Well Intended Program To Fail

Stanley Feld M.D.,FACP,MACE

President Bush keeps trying. I do not think he really understands the difference between poverty and unaffordability in America today. If he did his goal would be affordable healthcare insurance for all.

“The popularity of health savings accounts for the poor will be put to the test in Indiana under a program approved Friday by the Bush administration. Under the plan, someone making $20,000 a year could get health coverage for about $19 a week.”

Sounds good. However, the devil is in the details.

“Bush has long pushed health savings accounts as a way to slow the rising cost of medical care and extend basic coverage to the uninsured.

Under the Indiana program,eligible residents can pay up to 5 percent of their incomes into state-subsidized “Personal Wellness and Responsibility Accounts” that cover their initial medical expenses up to $1,100. Once that deductible is reached, private insurance purchased by the state kicks in.”

I have no quarrel so far. I see a few problems and questions. One problem is $1,100 does not get you much health coverage at retail prices. Private health insurance is still in charge of reimbursement and not a partner with the patient. What is the type of healthcare insurance coverage after $1,100? What are the co-pays? Only a few patients will have money remaining in their health savings account. There is nothing mentioned about giving patients incentives to stay well and potentially accumulate money for retirement.
Eligibility is limited to adults with incomes below twice the federal poverty level. The poverty level is now $10,210 for an individual and $20,650 for a family of four.

I looked up the actual eligibility criteria on their web site. I was curious to know if eligibility meant people making $41,300 a year would be qualified for the plan. The answer to this frequently asked question was;
The Healthy Indiana Plan (HIP) will provide health insurance for uninsured adult Hoosiers between 19-64 whose household income is between 22 – 200% of the federal poverty level (FPL), who are not eligible for Medicaid. Eligible participants must be uninsured for at least 6 months and cannot be eligible for employer-sponsored health insurance.

I was confused after reading this statement because of the absence of definitions. I asked the web site the following question.

Does this mean that people with a family of four making up to $41,300 a year can be eligible for this plan?
This feedback I got was as follows.

“The Healthy Indiana Plan (HIP) will provide health insurance for uninsured adult Hoosiers between 19-64 whose household income is between 22 – 200% of the federal poverty level (FPL), who are not eligible for Medicaid. Eligible participants must be uninsured for at least 6 months and cannot be eligible for employer-sponsored health insurance.”

The reply did not clarify a thing.

The eligibility limit is better than Medicaid but not as high as necessary to make it affordable. Moises would qualify in Indiana. He does not qualify in Texas. He makes $22,000 per year. An illness would destroy him and his family financially. He can not afford nor does he qualify to buy private insurance as an individual.

The limits for being qualified to receive benefits should be at least $50,000. The benefits packages should be developed by the insurance industry. The deductible must be higher than $1,100. Six thousand dollars is a realistic in order to provide patients with the appropriate incentive. It should be the Ideal Medical Saving Account formulation. It should be bought by citizens through the insurance industry on a competitive basis. It should not be run by the government as a single party payer. It should be subsided by the government for those who qualify for subsides. If the government finds that the insurance industry is taking advantage of patients or providers it should intervene and disqualify that insurance company from participating in the program. Patients of higher income should pay more for insurance than lower income people.

A mechanism for means testing should be developed. People below a certain income should receive government subsidies. Subsides should be regressive with lower income people receiving a higher subsidy than higher income people. The price of the insurance should be affordable and emphasize reward for good health, and prevention of disease. Both patients and providers should receive adequate incentive to achieve this goal. The Ideal Medical Savings Account could include both low income families and high income families. The high income families would pay a means tested surcharge to a certain amount.

“The waiver in Indiana is the first of its kind for the Medicaid program, a state-federal partnership that provides health coverage to the poor and disabled.”

The punishing criteria for eligibility for Medicaid still exist. On close study I have concluded that the Medicaid program is a way the state can obtain a subsidy from the federal government. The criteria for eligibility is simply too restrictive.

“Indiana officials said they’ve already received inquiries from more than 1,000 people interested in applying.
This sound bite implies impending success of the program. I think it is a long way from success.
The program will be monitored closely because of the philosophical divide among lawmakers about the value of health savings accounts for the poor. Many say such accounts work best for healthier and higher-income people with low medical expenses.”

The enemies of Health Savings Accounts have an excuse to react negatively. I believe that most lawmakers do not understand the goal of Health Savings Accounts. They also do not understand that Health Savings Accounts are a bastardize form of Medical Saving Accounts to keep the healthcare insurance industry in control and accumulate unconscionable profits

“Judith Solomon, senior fellow at the Center on Budget and Policy Priorities, said she doubts that many people making $10,000 a year can afford to pay $500 for health insurance. She said that about 50,000 people lost Medicaid coverage in Oregon after that state got permission to raise insurance premiums to $20 a month.”

“You can say it’s better than nothing, but I just don’t see how many of those folks will be able to afford it,” Solomon said.

Judith Solomon is absolutely correct. People making $10,000 dollars can barely afford to put food on the table or a roof over their head. So many well intended programs are built to fail.

“This is a big step forward that will lead to approximately 120,000 uninsured Hoosiers having the peace of mind of health insurance,” said Indiana Gov. Mitch Daniels, a Republican who once served as Bush’s director of the Office of Management and Budget.

I believe Governor Daniels should check to see how many of these 120,000 uninsured are living under the poverty level. I would guess less than 50%. It is fun to listen to Governor Daniels’ advertisement. , He makes a false promise and a false hope with false information.
If the state and federal government really wanted to do something they should expand the eligibility level to $50,000 a year. They should subsidize the Ideal Medical Savings Account with the incentive for patients’ to accumulate money in their retirement fund if they spend their healthcare dollars wisely.

Healthcare programs such as the Indiana program continue to appear and are destined to fail. The consumer must force lawmakers to get serious about Repairing The Healthcare System.

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

Stanley Feld M.D.,FACP,MACE

Healthy Indiana Plan:

  • Life Insurance Canada

    Nowadays, insurance companies tend to sell their products easily to those with ailing health. The reason is simple: they know that at some point they will be likely to need the benefits that these policies offer. However, people with middling health tend to be the ones whose financial situation does not really allow them to pay all those premiums. And the insurance companies will have to raise the premiums if they don’t want to go out of business. At the end of the day, a limited number of financially weak individuals will be paying the high premiums they can’t really afford. Those healthy men and women who would be able to pay even higher premiums, will never even think of buying a policy.

  • KGilbert

    I think HSA’s have major drawbacks for the poor and uneducated. There is great incentive for them to save healthcare dollars, but there is a disincentive for them to pay for preventive care. The uneducated will not look at the long term benefits of preventive care, preferring instead to keep the cash. And thus we will continue to incur incredible costs from easily preventable complications of chronic conditions.

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Bloomberg Seeks New Way to Decide Who Is Poor

Stanley Feld M.D.,FACP,MACE

Mayor Michael Bloomberg of New York City is a man who looks like he is thinking. He should be running for President.

The Bloomberg administration, frustrated by the federal government’s Great Society method of determining who is poor, is developing its own measure, which city officials say will offer a more modern and accurate picture of poverty.”

I discovered in studying the definition of poverty many smart people are frustrated by the definition and rules generated by the definition of poverty. Both the definition and the rules were developed in 1960 based on a 1955 study. I wonder how many government officials and healthcare policy makers know the origin of the poverty rules.

“The current federal poverty threshold was developed in the 1960s by Mollie Orshansky, an economist with the Social Security Administration, who based her number on a 1955 Department of Agriculture study that said low-income Americans spent about a third of their after-tax money on food. If a family had an annual income equal to three times the annual cost of basic groceries, Ms. Orshansky reasoned, they were not poor. If they fell below that income threshold, they were.”

America is different in 2008 than it was in 1960. It is difficult to envision rules made in 1955 being applied in 2008. It would be foolhardy to believe these policies could have a positive effect on the intended citizens using obsolete rules.

“Mollie’s Measure, as it is known in poverty circles, is still pegged to an annual grocery bill, adjusted for little more than price increases over time. The current poverty threshold for a family of four (two adults and two children) is a little under $21,000.”

Poverty is an important political issue in this election year. Yet not a single democratic candidate or republican candidate has challenged the antiquated definition of poverty. All they do is talk about how our wealthy nation does or does not take care of its less fortunate.

Michael Bloomberg is smart. He has pledged to reduce poverty in New York City. He is taking it seriously. He understands the danger of not helping our less fortunate citizens as seen recently in France and Britain.

About a year ago, the mayor announced that the city would put $150 million in public and private money toward new antipoverty programs.

In developing the new programs, however, the city discovered a serious obstacle: the federal poverty standard was all but useless in assessing whether the efforts were having an effect. This was especially frustrating for the mayor, whose business background and Harvard M.B.A. have conditioned him to look for measurable results.

Mr. Bloomberg is seeking a balanced approach in devising New York’s formula.
The federal method of calculating the income of poor people does not take into account the value of the extensive benefits that governments give out, like housing vouchers. But the city method will, offering an in-depth look at the assistance provided by New York, which has perhaps the most generous safety net in the nation.

Upwards of 600,000 families in the city are in public housing or receive substantial rental assistance. Other aid that would be counted toward income includes food stamps, subsidized child care and cash that is returned to families through the earned income tax credit and other tax credits. These benefits can be worth thousands of dollars a year for each family, and if that were the only change made in the formula, the number of poor in New York would drop drastically.”

New York is looking to establish a more realistic picture of how much money is needed to live there. Mayor Bloomberg is also going to help people get aid from sources that are available such as food stamps and housing vouchers as part of the program to help the poor.

“ In its new formula, the city would set its poverty threshold at about 80 percent of the median amount spent by American families on essential goods, which would include food, rent, clothing, utilities, and a little extra. Costs would be adjusted to reflect New York prices.”

Enter the critics.

“Though city officials insist they are approaching this undertaking without bias, it is almost impossible to separate the process from politics. “

Douglas J. Besharov, a scholar with the American Enterprise Institute in Washington, is watching the New York experiment intently and not without some cynicism that the city will come up with a far too generous formula. “It is highly likely they will come up with a higher poverty rate,” he said. “It is perfectly safe politically in New York and it certainly is a good P.R. device for the mayor who wants to be a poverty crusader.”

The critics’ job is to criticize even if the criticism makes no sense. If much of the aid is worthless now and not getting to the less fortunate it would be prudent to figure out how to get the aid to the needy.

“So the city began drafting a new measure, based on research done a decade ago by the National Academy of Sciences. Dozens of respected poverty researchers in the nation have been asked to weigh in as well.”

There has been an outpouring of criticism even before the criteria are established.

“Of course, New York City’s adoption of a new calculus, which skeptics predict is certain to conclude that there are more poor here than previously counted, could be met with opposition from other areas around the country, like rural states, especially if the city uses the new measure to argue that it deserves more federal aid.”

Isn’t this silly? All politics is local. Most economic situations are local. The federal government should establish policy philosophies. The rules have to be developed by the conditions in the individual states and cities consistent with the policy philosophy. If the local government of New York City wants to have employees for low paying jobs, New York City has to have affordable housing, food and medical care available. These essentials need to be subsidized using correct means test rules developed by the federal, state and local governments.

Mayor Bloomberg’s goal is to make a great city greater. The only way to accomplish the goal is to have the people of the city reach for this goal. This is accomplished by providing people with incentive to get ahead, real hope for a better lifestyle.

Mayor Bloomberg’s philosophy applies to Repairing The Healthcare System also. In my opinion, if the people owned their healthcare dollar, with the opportunity to save for their retirement if they used their healthcare dollar wisely, we could develop a functional market driven healthcare system no matter what their socioeconomic status is. Presently, we have a dysfunctional market driven system. It is driven by facilitator stakeholders that are not considering the interests of the patient primarily.
Let us take our hats off to Mayor Bloomberg. Someone is finally thinking clearly about the problems.

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

  • Andrew MacRae

    This is another great example of why Mike Bloomberg should be President. Results not Partisanship!

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Moises and Medicaid Part 2

Stanley Feld M.D.,FACP,MACE

I could not understand why Moises and his wife were rejected for Medicaid coverage. He did not qualify by the Medicaid rules in the state of Texas. I was not aware of the qualifying rules but thought $22,000 income per year would certainly qualify him for Medicaid. It was a difficult internet search. The rules are not transparent.

“What are the minimum qualifications?

Medicaid is available to qualifying Texans of all ages and abilities. There are separate programs for families and children and for people who are elderly or have a disability. In general, you must:
• Be a Texas resident.
• Be a U.S. citizen or a non-citizen in certain recognized categories.
• Meet certain resource and income limits, which vary by eligibility group.”

There is nothing in the statement that mentions specific income. The government wants price transparency but does not have it on its website.

“How do my assets, such as my home and bank accounts, and my income affect whether I can receive Medicaid?

The amount of assets and income you’re allowed depends on the category you apply under. Contact your local Eligibility office for more information. You’ll need to provide proof of income and assets when you apply. In most cases, a homestead is not counted as an asset.”

An applicant for Medicaid is at the mercy and judgment of the case worker. The case worker has concrete rules. There does not seem to be any exceptions or appeals.

“If I have a job, can I still qualify for long-term care Medicaid?

That depends on how much you earn at your job. Having a job may not disqualify you, but the amount of money you can earn and still be eligible for Medicaid is low.”

Where is the logic? An economist told me that Moises should know the rules of the game. His goal should be to have an income below the poverty level. Is this the American way? I was taught you were supposed to work hard, be creative and innovative, increase your income and live a better life.

Where is the promise of affordable healthcare? It seems to be simply rhetoric by politicians.
Something is wrong. Does anyone think universal healthcare with a single party payer system and its bureaucracy would solve the experience Moises had with Medicaid? I don’t.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.
StanleyFeld M.D.,FACP,MACE

  • Kevin Gilbert

    Your last couple sentences leave me puzzled. I am not sure that a universal coverage system with a single payer is the best system, but it would certainly solve Moises’s problem – he wouldn’t be turned down for coverage due to a judgment call on income from the case worker.

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