Podcast:

Being Thankful for the Uninsured [ 11:33 ] Play Now | Play in Popup | Download (706)

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(In what has become a tradition over the past few years, DrRich proudly reprises his annual Thanksgiving message to his beloved readers.)

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Gathered around the Thanksgiving table, DrRich’s large extended family, carrying out a longstanding tradition, each offered in their turn one reason for being thankful on this most reflective of American holidays. DrRich listened respectfully as each of his loved ones, and each of the ones he was obligated to tolerate benignly because they had married (or in some other manner had committed to) one of his loved ones, recounted a cause for thanks. There is no need for DrRich to recite their utterances here, because they were all perfectly predictable and fairly mundane, having mostly to do with items such as maintaining good health, finding a job, being able to afford one’s mortgage payments, getting a passing grade in French, receiving a new puppy, Mr. Obama’s remarkable Presidency, the apparent continued structural integrity of the Universe despite Mr. Obama’s Presidency, &c., &c.

When it was at last DrRich’s turn, he, in retrospect perhaps somewhat inadvisedly, was unable to refrain from displaying his keen insight and superior analytical abilities on matters related to healthcare (a topic, anyone would have to admit, about which most of us would very much like to feel thankful). Lifting his glass, DrRich pronounced that he was most deeply and humbly thankful for the 47 million Americans without health insurance; and further, especially thankful that their ranks  must surely be growing, given the recession, advancing unemployment, imminent collapses of businesses and indeed entire industries, &c. And even though Obamacare promises to significantly reduce that number, DrRich went on to express his fervent wish that large numbers of the uninsured might still be with us a year and two years and even ten years hence, for the great and good benefit of us all.

Enjoying the remainder of his Thanksgiving meal out on the back porch with the new puppy, DrRich composed in his mind this explanation which you now behold for the keen appreciation he has developed for the uninsured. He now offers this explanation both to his readers, and to the few members of his extended family who, he believes, might have been inclined to hear him out, had Mrs. DrRich not offered at that moment to consider remaining married to him only if he would retire from the table immediately. (Believing his marriage to be a union sanctified in heaven, he did so.)

In any case, for those who have an open mind, there are two compelling reasons we should be thankful for the uninsured, and should be particularly loath to allow them to disappear.

The first reason is that it is largely thanks to the uninsured that we are able to maintain the fundamental and dearly-held American fiction that there need be no limits on healthcare. (The image DrRich conjures up when he says “dearly held” is that of Gollum caressing the Ring.) Simply put, when we have tens of millions of uninsured Americans who don’t have ready access to regular and routine healthcare, then it’s relatively easy to pretend that “healthcare” should include everything we might want it to include.

Our current healthcare system relies heavily on using the uninsured as a huge fiscal safety valve. That is, in lean times (such as now), we open up the valve, increasing the number of people who are ineligible to consume routine healthcare. Increasing the number of uninsured Americans has become perhaps our most effective mechanism of covert healthcare rationing.

This simple expediency alone goes a long way toward enabling us to avoid having to consider or discuss limits. Openly recognizing the unavoidable limits to healthcare, much less having to figure out how to implement such limits fairly and rationally, would be exquisitely painful and disruptive. (Just ask Gollum how unpleasant it is to be forcibly separated from that which we love and deeply value.) For helping us to avoid such pain and societal disruption, we clearly owe a great debt of thanks to our uninsured brethren.

The second reason came to light recently in an article in the Journal of the American Medical Association.* This article showed that – contrary to both popular lore and to stern pronouncements by policy experts bent on convincing us that (next to global warming) reducing the number of uninsured Americans is the most important task of mankind – the overcrowding in American emergency rooms is NOT due to the uninsured. Rather, it is due to insured Americans who cannot get in to see their primary care physicians.

DrRich has discussed at some length the primary care crisis and its causes. That is a very important topic, but it’s not the topic of this particular posting. This posting is about the great and abiding value of the uninsured.

It really should not be a great surprise that emergency room overcrowding doesn’t have all that much to do with the uninsured. While it is difficult to generalize about such things, a large proportion of the uninsured are people who have assets. (If they had no assets they likely would be eligible for Medicaid.) That is, they are people who have jobs, homes, cars, &c., but their employers (who, in many cases, are themselves) cannot afford to provide them with health insurance. The chief point being, of course, that these individuals have something to lose.

These are not the people who will voluntarily enter an emergency room for their healthcare, at least, not for a medical problem that they can somehow convince themselves might go away on its own if they give it a chance (such as, perhaps, crushing chest pain, or paralysis of the left side, or some other such eventuality which might cause some of us less circumspect, more insured people to just go ahead and dial 911, all willy-nilly). They realize that the moment they set foot into an emergency room they will generate a bill of at least several thousand dollars, which they will either have to pay, or spend months or years fighting off the increasingly aggressive bill collection professionals being dispatched these days by their local hospitals. They are putting their assets and their futures at risk if they come to the emergency room.

Rather, the overcrowding is due to people who have insurance – whether it’s Medicare, Medicaid or private insurance – and who are therefore entitled to their healthcare by whatever means they calculate is the most convenient for them. Increasingly, because primary care practices are hard to find, are booked for weeks in advance, and are less and less user-friendly by the day, the convenience calculation tends to default (incredibly) to the emergency room. (That insured people are choosing emergency rooms – notoriously one of the most unpleasant experiences American citizens can encounter in peacetime – instead of the offices of their primary care physicians should itself set off major alarms about the state of American primary care.)

This is all fairly intuitively obvious, and the JAMA article really should surprise only those who habitually believe all the prevarications being promulgated as Gospel today by politicians, media, and various authorities on healthcare.

It should be plain that suddenly providing tens of millions of Americans with health insurance will decidedly not relieve emergency room overcrowding, as the policy “experts” all promise us (the same experts, apparently, who promised us that the stimulus package would rescue the economy and prevent increased and prolonged unemployment, and who confidently spout a host of predictions which fly in the face of history, common sense, and laws of economics, physics, and human nature). On the contrary, creating tens of millions of newly insured individuals, without simultaneously revolutionizing our attitudes and policies toward primary care medicine, will quite obviously make our already overcrowded emergency rooms absolutely burst at the seams, and render even more hellish than it is today – even deeper down within “grief’s abysmal valley” – the prospect of entering such a place. Indeed, if we suddenly insure all these people, the rest of us who currently have insurance really won’t have anywhere to go to get our healthcare.

So. QED. As DrRich said at the Thanksgiving meal, thank God for the uninsured.

Clearly if DrRich had been permitted a mere five minutes to explain himself, not only might he have avoided eating runny mashed potatoes in a steady drizzle, but he also might have salvaged his reputation among some of the more remote members of his extended family, who really don’t know what a swell and reasonable guy he can be. Next year when his turn comes, DrRich will choose to be thankful for some more traditional value, in the hopes of being allowed to eat his meal in a warmer, drier, friendlier environment – perhaps he can be thankful for the growing number of obese Americans, and the great service being provided by these patriots-to-mankind as they reduce global warming.

* Newton MF, Keirns CC, Cunningham R, et al. Uninsured Adults Presenting to US Emergency Departments: Assumptions vs Data JAMA. 2008;300(16):1914-1924.

Podcast:

Republicans Blithely Enter The Individual Mandate Trap [ 13:52 ] Play Now | Play in Popup | Download (84)

Progressive Americans have this much going for them: they can, without any reservations, second thoughts (or perhaps even first thoughts), enthusiastically and wholeheartedly support Obamacare’s individual mandate. For them, the individual mandate is an unalloyed good. Not only does it enable Obamacare to proceed, thus giving the government unprecedented control over every aspect of American healthcare, but it also establishes the authority of the government to control the economic activity of individuals. This new authority will come in very handy as our leaders continue working toward redistributive justice. So if you’re a Progressive, what’s not to like about the individual mandate?

Conservative Americans do not have it so easy. In principle, of course, the very idea of an individual mandate is constitutional heresy to a conservative, since it violates not only the letter but the very spirit of the Constitution. This is why, over the past three years, opposing the individual mandate has become for conservatives a more fundamental litmus test than opposing abortion. Accordingly, it is conservatives who have launched the constitutional challenge to the individual mandate, and who have now succeeded in bringing it before the Supreme Court, and who have based their chief strategy for bringing down Obamacare on the idea that the Supremes will agree with them about it.

DrRich, like most conservatives, is aghast at the idea that the Court might actually find the individual mandate to be compatible with the Constitution. Such an expansion of the power of the Central Authority over the lives of individuals will essentially gut the main idea behind our founding, and send us even more rapidly down the path toward tyranny.

But as he contemplates how he might feel on the day the Supreme Court finally strikes down the individual mandate, DrRich can’t help conjuring up the last scene from The Graduate. In that scene, Dustin Hoffman, who has just burst into the church and fought through a horde of wedding guests to grab his girl from the altar, and, with her in tow, has fought his way past the stunned groom and back through the angry crowd, and having at last jumped with her onto a city bus, is now sitting breathlessly, his hard-won love at his side, as the bus pulls away leaving their pursuers behind. And as that last scene fades, his look of elation at finally winning his heart’s desire gradually slackens, and transforms into a look of utter panic, a look that silently beseeches, “Now what?” Or, perhaps, “What have I done?”

DrRich thinks that’s what will happen to Republicans on the day the individual mandate is declared unconstitutional.

There is a reason, dear reader, that Mitt Romney, Newt Gingrich, and the Heritage Foundation, all of whom claim to be conservatives, at one time or another supported something very much like Obama’s individual mandate. That reason is: it is very difficult to conceive of a workable, market-based solution to our healthcare mess without one.

Any scheme for reforming healthcare that is based on private health insurance will fail if a substantial proportion of the population declines to purchase health insurance. Whether people have chosen to acquire health insurance or not, they will still get sick. And when the uninsured get sick there are only two choices.

The first choice is to refuse them care. Libertarians have no problem with this. They believe that if you want some healthcare, you should pay for it yourself. If you choose not to buy health insurance, or otherwise fail to make arrangements to pay for healthcare should it turn out that you need some (as well you might, if you engage in all the activities and abuse all the substances that libertarians say is your right), well, that’s too bad for you. Let your painful and untimely demise serve as an object lesson to everyone else, so that perhaps they will make better personal choices. Most non-libertarians, however, find this option abhorrent.

The second choice is to take care of the uninsured anyway. If you do that, not only do you drive up the cost of health insurance for people who have chosen to buy it, but you also create a huge incentive for people to not buy it in the first place.

This is why Republicans or conservatives who have thought deeply about healthcare reform (Gingrich, the Heritage Foundation), or who have actually instituted healthcare reform (Romney), will often settle upon a solution that incorporates something very much like President Obama’s individual mandate. Unless everyone is strongly “incented” to buy health insurance, a market-based healthcare system will collapse.

More to the point, Republicans ought to recognize that, while it seems to have wound up that way, the individual mandate in Obamacare did not start out as a sneaky way to undermine the Constitution. It was, in fact, a necessary concession to the more conservative of the Democratic members of Congress. President Obama and his minions (or handlers, depending on which talk show hosts you listen to) are on record as saying that their real goal is a single-payer, government-controlled healthcare system. And there is no reason in a single-payer, government-controlled healthcare system to invoke anything like an individual mandate to purchase insurance. The President would have been quite happy without any individual mandate, if he could have gotten his way in the first place.

The individual mandate was inserted into Obamacare purely as a necessary component of healthcare reforms that are ostensibly based on private health insurance, which is the only kind of reform the President could possibly get through even a Democratic Congress in 2010.

If the Supreme Court declares the individual mandate to be constitutional (which will violate everything DrRich holds dear about America), then it’s a huge win for Obamacare.

But if they declare it unconstitutional, that will trigger the Republican’s real problems.

Republicans, Democrats and federal judges all seem to agree that without the individual mandate, Obamacare is infeasible. The moment the mandate is declared unconstitutional, Obamacare disappears.

And this will create a “Graduate” moment. There the Republicans will be, sitting on the bus with the healthcare system they have just saved from the handsome-but-arrogant groom who had Big Plans for it, and heading to – where?  They can’t just go back to the old healthcare system; we’re past that. The health insurance industry has made it plain that their business model is broken, which is why they acceded to and even campaigned for Obamacare (a system under which they are to become federally-regulated public utilities) in the first place. Should Republicans institute their own market-based healthcare reforms? Good idea! But what do they do about the people who choose not to buy private insurance, now that they have had mandates to purchase declared unconstitutional? And even if they have an answer to that question (which they do not), do they have a plan ready to go, one that can be implemented quickly, before the healthcare system implodes? (Remember, Republicans, you will be dealing with a health insurance industry that has run out its string, and that will be at least angry if not panicked at the demise of its public-utility end-game.)

As it happens, DrRich himself has proposed a fix for the healthcare system that addresses all these problems – a system that is based on individual choice and incorporates private insurance, and at the same time covers everyone without any individual mandate, and controls healthcare costs to boot. The details are entirely irrelevant at the moment, and DrRich will not bore his readers with them now. (If you’re interested you can buy a copy of his book in Kindle format for five bucks, or if that’s too steep you can read an outline of his plan here for free.) The point is that workable solutions to our healthcare problems are indeed imaginable. The likes of DrRich has imagined such a thing, and so have others. But Republican candidates for President, and Republican congressional leaders, are not creating these solutions. Instead, they are steering us into a blind alley.

Here is what DrRich fears. When the individual mandate is declared unconstitutional next June, the Republican celebration will last all of 7.5 minutes. The insurance industry will make it very clear very quickly that they simply will no longer be able to function, and to have any hope of survival they will have to resume cherrypicking healthy patients, massively increasing premiums, denying recommended care, and dropping subscribers when they get sick. Even with these drastic steps, they will say, there’s no guarantee that health insurance will still be available for most Americans in a year or two. And at the time these astounding revelations are made, the Republicans won’t even be finished choosing a nominee, let alone be able to articulate a coherent plan for replacing Obamacare. By Independence Day panic will reign across the land.

The President will then make a speech. He will say, “We tried, America. In the spirit of bipartisanship we tried to give Republicans a system of market-based healthcare reforms, just like they say they wanted. But that kind of system requires an individual mandate, and our misguided friends on the right have now shot the individual mandate through the head. And when the American people ask those same Republicans who brought this disaster upon us, “Now what?” the American people get no answer. The Republicans are quite good at destroying healthcare solutions, but are hopeless when it comes to creating them. And you can hear for yourselves what the health insurers are now threatening to do to all of us when we get sick. It will be just like it was before, but much, much worse.

“We tried, America. We tried to create a market-based healthcare system that would be fair to all. But the Republicans, caring for nothing but their own selfish political fortunes, have blocked our efforts, and have left us all for dead.

“Fortunately, in a few short months you will be able to exercise your God-given right as Americans to choose. If you want to, you can vote into office the Republicans, the people who have traded your healthcare security and that of your family in favor of the chaos we are all witnessing today. Or you can re-elect me, and you can give me a Congress I can work with, and let us try to salvage something good from the ruins of the glorious reforms we fought so hard for the last time. Let us try to give you the best healthcare system that is still possible, given the new constraints the Republicans have now made for us. While you and I might not have started out wanting a healthcare system run entirely by the government, today our choice is either that, or the chaos, pain, suffering, disability and death that, thanks to the good offices of the Republicans and their friends in the health insurance industry, are now staring us in the face. But this is not the first time Americans have stared evil in the face. We have done it before, and we have always prevailed.

“We tried, America. We tried – but the Republicans denied, and babies died.

“My fellow Americans, in November you will have the opportunity to say no to the forces of evil, and to set this travesty right. I know the heart of Americans, and I know that you will do the right thing, not only for your own sake, but for the sake of your children, and your grandchildren, and generations of Americans yet unborn.*”

And when President Obama is finished laying out his argument, the Republican nominee, whoever he or she turns out to be, won’t know whether to cry, “Oops!” or “Nein, nein, nein!”

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*DrRich is a conservative but also a capitalist, and so his speechwriting services are available to the highest bidder. Mr. Obama, mutual “friends” in the DOJ have proven adept at tracking DrRich down when necessary, and will know how to contact him.

Podcast:

An Epiphany On Direct-Pay Practices [ 12:32 ] Play Now | Play in Popup | Download (1056)

DrRich’s recent posts on the death of primary care medicine elicited several responses from readers, not all of them positive.

Most of the complaints DrRich harvested from these posts had to do with his suggestion that the physicians formerly known as PCPs ought to drop out of the dysfunctional healthcare system altogether (the system that has, purposefully and with malice aforethought, wrecked their chosen careers), then strike out instead on their own, and establish private practices in which they are paid directly by their patients.

This suggestion creates, among many in our society (and apparently, among many of DrRich’s readers), a viscerally negative reaction. Many people believe that DrRich is exhorting doctors to embrace their inner greed, and abandon the great lot of patients in order to satisfy their own selfish desires and foolish professional pride.

A reasonably typical comment came from one Tracy, who avers, “Only the rich will be treated. I don’t think we want to do that do we?”

Now, if DrRich were a Progressive, he would take advantage of the fact that Tracy (who thoughtfully provided his website address) is a health insurance agent, and would dispense with him using a scathing ad hominem attack, something like: Look who’s talking about somebody selling a vital healthcare product at such a high price that people can’t afford it!

But DrRich is not a Progressive. So he will ignore the delicious irony in Tracy’s complaint, and address the substance of his comment. To restate Tracy’s objection (and, in fact, all of the objections that have been made to physicians dropping out of the system and establishing direct-pay practices): For doctors to demand that patients pay them directly is elitist and unethical; only the rich will be able to afford this kind of care; a two-tiered healthcare system will develop, and public health will suffer.

DrRich will answer this objection in two ways. First, he will make a philosophical argument as to why direct-pay practices are the right thing to do. Then he will give a real-world example that demonstrates how a direct-pay practice is, in fact, good for patients and for society.

The fundamental argument that supports the rightness of direct-pay practices has been made numerous times on this blog. In summary: In the attempt to control healthcare costs, the Feds and the insurance companies have, in uncountable ways, entirely coerced physicians (using and exercising the threats of loss of income, massive fines, and jail) to place the needs of the payers ahead of the needs of their individual patients. In so doing, they have systematically destroyed the doctor-patient relationship, in the process killing medical professionalism, and reducing patients to objects, to cost centers, and abandoning the sick to their own devices as they attempt to navigate an increasingly hostile healthcare system.

This process is now firmly established. It has been legislated by Congress, embodied in volumes and volumes of rules, regulations and “guidelines” (strictly and ruthlessly enforced), upheld by the courts, and finally (and most tellingly) sanctioned as being entirely “ethical” by the physicians’ own professional organizations.

It has become impossible for doctors – especially the PCPs, who have been most directly affected – to fight this reality. If they want to escape, their only options are to become a medical specialist (since outpatient primary care is the main lever on which the Feds are pushing), a deep-sea fisherman – or a direct-pay practitioner.

So primary care doctors must either resign themselves to a system that ruthlessly pushes them toward an unethical, demeaning, public-health-destroying style of practice, or (one way or another) get out.

The only means that will allow them the freedom to practice primary care medicine in a way that is compatible with true medical ethics – which allows them to place the needs of their individual patient above all other considerations – is the direct-pay model. And this means that the only way for a patient to have a primary doctor who treats them the way patients are supposed to be treated is to find a direct-pay doctor.

To argue that direct-pay practices – or any innovation that would somehow restore both the doctor’s professional integrity and the patient’s rightful advocate – is unethical is completely upside down. It is one of the few viable pathways toward restoring the foundational (but currently obsolete and officially repudiated) medical ethic of always placing the patient first.

To argue that direct-pay practices threaten public health completely ignores reality. In fact, this is one of the few viable pathways toward restoring protections that the public is supposed to have when facing a healthcare system that is utterly bent on avoiding spending money on them.

To argue that direct-pay practitioners are creating a two-tiered healthcare system is ridiculous on its face in a society that gives mere lip service (though, to be sure, plenty of it) to the problem of 47 million uninsured.

To argue that direct-pay medicine will create a subpopulation of elites (because it provides a mechanism by which some individual patients can escape the deadly obstacles that have been intentionally laid before them), is as absurd as arguing that George Washington was wrong to free his slaves upon his death (or even that New York State was wrong to abolish slavery at about the same time), because it created a subpopulation of “elite” (i.e., free) African Americans; that until all slaves were freed, no slaves should have been freed. But freeing at least some slaves – and forthrightly stating why it needed to be done (see: Declaration of Independence) – was not only ethical, but also showed what was possible, and over time created an expectation that eventually could no longer be ignored, and that, at huge cost, was finally fulfilled.

It is important to note that any innovation that can potentially spare patients from some of the harm the healthcare system has in store for them will necessarily be applicable to only some patients at first. That’s how disruptive processes work. They begin as niche products or services, attractive only to a few high-end users; too expensive or too marginal for the vast majority; ignored, ridiculed or castigated by current providers. But if at their core they’re offering something fundamentally useful, they will slowly demonstrate their worth – and eventually all the potential users will see the light, and demand for the product will become explosive. When that happens, the means are found to make the new product affordable and available to meet the demand – often by making significant adjustments to the original concept, that nonetheless preserve the core benefits. And when that happens, the traditional providers (who never saw it coming) are suddenly out of business.

It may not be that direct-pay medicine plays the personal computer to the traditional healthcare system’s mainframe. But it is inarguable that what it offers to patients – at its core – is every bit as vital and every bit as indispensable. And if a critical mass of the public can be made to understand what is really being offered here, there will be no holding it back.

Unfortunately we have a limited window of opportunity. The vociferousness of the complaints against direct-pay practices indicates just how threatening these are to the Progressive program. Unless this practice model gains a sufficient toehold, and quickly, it will be made illegal. Because Americans cannot be permitted to spend their own money on their own healthcare.

DrRich will finish by pointing his readers to a real-world model of a direct-pay practice which, he believes, graphically demonstrates the potential benefits of such a model.

Epiphany Health is a direct-pay primary care practice recently begun by Dr. Steven Shell and Dr. Lee Gross in southwest Florida. These doctors took pains to make their services affordable to many of the uninsured (and underinsured). For about what you would pay for a cell phone contract or for cable TV, they will be your doctors.

Doctors, that is, in the original sense – a professional who knows you well, a personal advocate for your health, who is dedicated to placing your interests above all the other competing interests within the healthcare system. Because they are paid by you, it is you they must satisfy in order to have a viable career.

As Dr. Shell told Sun Newspapers, “Our simple, preventative healthcare plan has several advantages that include true price transparency (cost of services ahead of time), high quality care, affordable fees, no copays, no deductibles, no pre-existing condition exclusions and a plan not tied to an employer.”

In addition to price transparency, Epiphany offers major price discounts to their patients. They have negotiated these discounts with pharmacies, physical therapists, imaging centers and laboratories. These discounts are often in the range of 75 – 80% of the cost to non-members.

Now, if this kind of practice is unethical, elitist, or damaging to the public welfare, DrRich just does not see it. In fact, as much a benefit as this kind of practice might be to doctors, it is far more beneficial to the patients lucky enough to have such an option available to them.

You who aren’t so lucky should look at what Epiphany is offering – and demand it for yourselves. If you do, you will have it. There are thousands and thousands of disaffected doctors who would love to practice medicine like this, but they have been cowed to inactivity by the naysayers (and Progressives) with their cries of, “Elitist! Immoral! Unprofessional!”

If these doctors heard from their patients, all the negatives would be forgotten, and they too would have their own epiphany.

Especially since the events of last week, it would be absurd for DrRich to think that everybody is out to get him. Still, it seems plain that, of late, not all individuals enjoy his efforts here at the Covert Rationing Blog.

Two years ago, for instance, DrRich was “invited” to testify as a witness before a federal grand jury in a matter involving one of his consulting clients. While under oath, DrRich was caused to understand that the Feds (at least certain members of the DOJ) are well aware of this blog, and of the general tenor of its content. The impression left by this experience makes DrRich doubt whether many of his fans come from that particular precinct.

Further, the CRB has been the victim of two targeted denial-of-service attacks just in the last several months. Perhaps this is a common experience for healthcare bloggers, but then again, perhaps not. Finally, there’s the fact that last May (some readers may recall) a nasty hacking exploit completely trashed the CRB at the server level, resulting in the loss of the first three years of DrRich’s endeavors here (which, some have said, is the greatest tragedy to befall posterity since the burning of the Library at Alexandria).

And so, Dear Reader, while DrRich is certainly happy to be hosting Grand Rounds for the fourth time, and is particularly delighted with the quality of postings which he has the honor of featuring this week, it occurs to him that hosting an event with such high (and well-deserved) visibility might draw certain “extra attention” here.  So perhaps you had better read this quickly.

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We begin with HealthAGEnda, the John A. Hartford Foundation blog, which is posting a remarkable series of articles by Amy Berman, a senior program officer at that foundation, who has recently been diagnosed with an incurable form of breast cancer. Ms. Berman discusses very openly and frankly both the good and the bad aspects of the American healthcare system she is encountering  as she deals with this likely fatal illness. In this post, the second in a series, Ms. Berman talks about her ordeal in confirming what she already strongly suspected was a very bad diagnosis, and describes the comfort she experienced, while “meeting the enemy,” from compassionate but frank healthcare professionals. She had a much less favorable experience, which she describes in her first post, demonstrating just how devastating it can be for a patient to encounter a one-size-fits all physician. The impact such an encounter has on a patient who needs real medical help is especially relevant in an era in which doctors are being urged (coerced) into following just such an approach. Ms. Berman is an extremely brave and gracious woman, and the important insights she is providing in her efforts to chronicle her illness ought to be read by every health professional.

Henry Stern of Insureblog discusses the documented, systematic mistreatment of the elderly under the British National Health Service. Stern points out that while similar mistreatment of the elderly also happens in the American healthcare system, here it is sometimes not systematic, but rather is most often due to sloppiness or inadvertent error, and further, when it happens remedial actions (such as lawsuits) are often available. In contrast (evidence suggests), treating the elderly badly in the NHS seems to have become virtual policy. DrRich, of course, longtime president and sole member of Future Old Farts of America (FOFA), is confident that nothing of the sort will ever happen here in the U.S. where the government always has our best interests in mind, and he is sure that when government officials refer to the NHS as an ideal to which we should all aspire, they are probably not talking about this part of it.

Writing on a related topic, Julie Rosen of Bedside Manner tells about steps doctors and families can take to resolve disagreements on how aggressive one ought to be when deciding on the use of certain treatments for elderly and mentally incapacitated patients. DrRich finds Ms. Rosen’s recommendations appropriate, since all of them take place at the local level, with full participation of the patient’s loved ones, and do not (explicitly, at least) involve the heavy hand of any Central Authority.

And still speaking of the role of authority in deciding on aggressive treatments, The ACP Internist posts a news report about a court-ordered spinal operation on a 16-year old who was injured during a wrestling competition. Neither the young man nor his parents wanted the operation, which they feared might cause paralysis.  (Apparently, they were actually paying attention during the “informed consent” process.) Further, as the mother apparently demonstrated in a video shown on local TV, her son had a “full range of motion” prior to surgery. Nonetheless, the young man was removed to protective custody, and the court-ordered surgery was performed (apparently successfully, thank goodness, or else this might have turned into a controversial decision). One hopes the judge, in making his determination that the family was not acting reasonably, was not swayed by their expressed partiality to herbal medicine and homeopathy. Wacko as such practices may be, they do not appear particularly relevant in this case, given the family’s seemingly cogent argument that the risk/benefit calculation, as it had been presented to them by medical professionals, simply did not meet their threshold for such aggressive treatment. Apparently, it met the state’s.

The ACP Hospitalist offers a post from a doctor at Grady Hospital entitled: “10 ways to know that the nurses hate you.” These 10 clues as to nurses’ disapprobation are both amusing and true. However, after observing for over 30 years the kinds of behaviors to which nurses are forced to resort when they see that things are greatly amiss, but at the same time they are powerless to directly intervene, DrRich thinks this post more accurately ought to be entitled, “10 ways to know that the nurses think you are killing your patients.” The nurses may or may not actually hate the doctor for it, but they wish he/she would stop – and here are 10 ways in which they may often express that wish.

While some states are big troublemakers (and you know who you are), others are moving to implement provisions of Obamacare just as the Central Authority has decreed. Louise from Colorado Health Insurance Insider tells us that Colorado Senate Bill 168 was introduced last week to create the nonprofit healthcare cooperative which is required by all states under Obamacare. (Shouldn’t somebody tell the Colorado state senators that writing long tracts like this in ALL CAPS is considered impolite, as it is the documentary equivalent of shouting?) Louise notes that the healthcare cooperatives mandated by Obamacare may help to reduce the number of uninsured, but adds that Obamacare “will do little to address a range of other problems, including rising healthcare costs, the unaffordability of healthcare even for people who have health insurance, over-utilization of care, and the problems created when we link health insurance to employment.” While these are all legitimate points, regular readers will know how little DrRich himself goes in for such grousing.

Obamacare, after all, does so much! As a case in point, David Harlow at HealthBlawg writes about Accountable Care Organizations, a new entity which figures prominently under Obamacare, and which will be a chief vehicle for controlling the cost and quality of healthcare (i.e., for controlling physicians’ behavior). A lot of scary things have been written about ACOs (including, truth to tell, things written here at the CRB), but Harlow points out that ACOs might not turn out to be such a bad idea after all. For evidence, he points to some of the successes realized by AQCs (Alternative Quality Contracts) in Massachusetts, under admittedly favorable practice environments, and notes that some of these successes might be translated directly to ACOs. DrRich hopes he is right. But it is a little worrisome that nobody, including Harlow (as he himself allows), really knows what ACOs will end up looking like. Their structure is, as we speak, being fought over by numerous federal agencies (like a carcass being fought over by a pack of dogs), and among these agencies (DrRich shudders to contemplate) is the Department of Justice. But Mr. Harlow knows far more about this stuff than DrRich, so let’s all hope for the best. Short of defanging Obamacare, that’s about all one can do.

Amy Tenderich of Diabetes Mine submits a guest post from Valentine’s Day, written by Wendy Strgar, entitled “Healthy Sex, Healthy Love.” Ms. Strgar, who is known in some circles (circles of which DrRich himself is innocent) as a “loveologist,” and who markets the sexual-aid products to prove it, actually makes a pretty convincing argument that sexual activity can be an important part of reducing one’s risk for all sorts of medical problems. So: Are you one of those folks who has thought about having more sex, but you’re just not sure the pay-off is worth all the trouble? Read this post.

Dr. Pullen at DrPullen.com posts about the problem of anti-personnel mines, which continue killing and maiming innocent people all over the world, and for decades after hostilities cease. He rightly thinks the US ought to do more to resolve this problem, and in particular, he decries apparently serious suggestions some have made that we ought to deploy mines on our southern border to prevent illegal crossings. DrRich agrees with Dr. Pullen, but does not believe that mining the U.S. border will ever become a serious consideration (unless it is to prevent American citizens from sneaking southward to receive black market healthcare).

Doug Perednia at The Road to Hellth is writing a fascinating series on the wonders of Pay for Performance. In this, his second offering, Perednia provides some pretty overwhelming evidence, including evidence from studies which proponents use to justify P4P, that P4P demonstrably does nothing useful. Actually, DrRich should qualify that statement: It does nothing useful in terms of improving clinical outcomes. What it does do (as Perednia demonstrates) is to forcibly distract physicians from listening to their patients, to fully consume all the time allotted for a patient visit, and to actively discourage other forms of doctor-patient interactions which might lead to additional healthcare expenditures. So despite a now-well-documented lack of any improvement in patient outcomes, P4P is in fact achieving its actual designed ends, and thus must be counted a great success.

Dr. Joe Smith, who writes the Dr. Unplugged blog (a Medscape blog which requires free registration), travels the globe seeking out emerging technologies related to wireless healthcare. In his latest article Smith laments the fact that, so far, the healthcare consumer has completely missed out on the ongoing wireless revolution, a revolution that has greatly empowered consumers in virtually every other economic sphere. He concludes that despite this slow penetration, wireless technology inevitably will also transform the lives of healthcare consumers. DrRich agrees that this outcome is indeed inevitable, but thinks it may take a while. Resistance to the empowerment of individual healthcare consumers is deeply entrenched, massively well-funded, extraordinarily powerful, amazingly ruthless, and very widely distributed (from the beltway to the bedside). Such resistance is akin to the all-pervasive power of the Church 500 years ago, a power that was eventually broken, but that required the technology (printing press), the killer app (Bibles printed in the vernacular), the catalyst (Martin Luther’s 95 theses), the poorly-expressed but ultimately deep-seated desire of the populace for the knowledge being offered, and the fortitude to persevere through 300 years of reformational bloodshed. So, yes, history ultimately will win out with regard to wireless healthcare, but one fears it may take more than just the healthcare equivalent of the iPod or Facebook to see it happen.

The anonymous author of The Notwithstanding Blog is a Canadian medical student with a background in economics. In the short time this blog has been around, he (or she) has done some very cogent writing applying economic insights to medicine. The featured post describes why medical ethicists (despite their constant yammering about honoring the autonomy of the individual) almost always decide specific ethical questions the other way, that is, against individual autonomy. DrRich, in his ham-fisted style of analysis, always tends to blame this phenomenon on the fact that Progressives in recent decades have largely taken over the Ethicists’ house, just as they have taken over in most academic fields, and that Progressives as part of their DNA must always come down on the side of the collective. But Dr. Notwithstanding offers what is likely a better explanation, based on economics (the science of human behavior) instead of on political ideology. As you’ll see, in addition to being an original thinker Dr. N is an engaging writer. You should give this blog a try.

In stark contrast to Notwithstanding’s anonymous blog is Carolyn Roy-Bornstein‘s eponymous one. Here she describes one of the absurdities doctors see every day with the modern-day electronic medical records which are being adopted all over the place, with great fanfare (and with public subsidies), to streamline healthcare, reduce redundancy, eliminate waste, and assure quality care. Namely, while these new electronic records may greatly simplify the lives of the federal regulators and the forensic accountants who keep track of which doctors are being naughty and which are being nice, they often gum up the works for the people on the ground who are actually trying to take care of sick people. EMRs can do this in many ways, and Dr. R-B nicely describes one of them: She laments the reams of redundant, boilerplate, tree-killing verbiage these records spit out, each and every day, for each and every patient, a characteristic which makes the formerly simple task of figuring out how the patient’s doing today a constant challenge, a perpetual exercise in patience and persistence. and a powerful attractor for medical errors. She ends by speculating whether it might make things easier to have somebody sing these records to her. A nice thought, but DrRich thinks it would not help. What you’d get is an early Phillip Glass composition, in which the same nonsense phrases are repeated over, and over, and over, and over. . .

The Happy Hospitalist discovers that latex examination gloves (powdered, one-size-fits-all, Spic and Span brand), are available at 10 for one dollar at the local dollar store. His discovery suggests a couple of things. As Happy points out, hospitals which are expected to survive on Medicaid payments now have someplace to shop. And, if you want to bring down the cost of healthcare products and services, simply make them available for direct purchase by consumers.

Carolyn Thomas of Heart Sisters writes of journalist Melissa Mia Hall who died in her Texas home in January after avoiding medical help for her severe and persistent chest pain (regarding which she wrote a running commentary to friends – and ultimately to posterity – via e-mail). Ms. Thomas concludes that had Ms. Hall had health insurance (which she did not), she likely would have done more than just document the progression of her fatal heart attack. DrRich has no personal knowledge of Ms. Hall, and so cannot contradict this conclusion, nor does he wish to. However, a recent survey by the American Heart Association showed that in 2009, only 50% of women (regardless of insurance status) said they would call 911 if they thought they might be having a heart attack. DrRich, who has long lamented the feminization of men in our society, now utters his dismay at the converse – the masculinization of women. Ladies, if you have symptoms suggestive of a heart attack, don’t try to tough it out. Call 911.

Steven Wilkins of The Mind Gap tells how sessions of culturally-sensitive “storytelling” can break down certain cognitive barriers for some patients, and more fully engage them in their medical treatment. Wisely, Wilkins is not suggesting that beleaguered PCPs develop a stable of appropriate yarns they can spin for their recalcitrant patients during the 7.5 minutes the Central Authority has allotted for each “patient encounter.” Rather, he has several helpful suggestions for incorporating such storytelling into existing systems, which would leave the doctors alone to do what they’re paid for – making little electronic chits on Pay for Performance checklists.

Vineet Arora at FutureDocs talks about the universally-recognized phenomenon of the over-ordering of radiological diagnostic tests, which is detrimental both to patients’ health and to the healthcare budget. She discusses the many reasons too many of these tests are ordered. It boils down to the fact that the healthcare system provides physicians with extraordinarily strong incentives, at many levels, NOT to rely on their clinical judgment, but instead, in order to optimize their odds of professional survival, to just go ahead and get the test. Unfortunately the solutions Dr. Arora suggests to this difficult problem do not hinge on restoring the doctor’s clinical judgment as a legitimate decision-making tool. (This is no fault of hers; to restore respect for the doctor’s clinical judgment would require a wholesale change in how the healthcare system now operates.)  Instead, she suggests counterbalancing the strong coercions doctors feel to order too many of these tests, with new, and equally strong, coercions not to. Laboratory rats faced with similar, unresolvable imperatives to respond to two opposite stimuli, of course, quickly die of the stress.

Dinah from Shrink Rap notes that the FDA is about to take an action that may effectively render electroconvulsive therapy (ECT) a thing of the past. Specifically, the FDA is likely to reclassify ECT machines (which have been in clinical use since long before the FDA controlled such things) as Class II medical devices. If so, then for these devices to remain on the market, the two companies that manufacture them would have to conduct expensive new clinical trials to document safety and efficacy within 30 months. Observers judge that these companies would not have the resources to do so. ECT is a highly controversial procedure, and there are vocal groups which are trying to ban it – but for some patients with severe depression, Dinah points out, ECT has been a very effective and potentially life-saving last resort therapy. These unfortunate patients, apparently, can now join all the others whose response to various treatments resides in the tail of the standard distribution curve, and for whom the tailored, individualized therapy they require will no longer be an option.  So they will just have to make do with the guideline-driven treatments that suit the average patient just fine. Nonetheless DrRich predicts this change can be implemented with minimal outcry, since severe depressives, being often imbued with great inanition, likely won’t complain very vociferously about it.

Speaking of shrinks, Philip Hickey of the Behaviorism and Mental Health Blog writes about his observations regarding how and why “mental illness” has become such a growth industry. He says, “’Mental illness’ is a spurious explanatory concept whose purpose is to medicalize for profit the ordinary problems of human existence which our ancestors tackled and resolved without drugs for thousands of years.” While DrRich might not buy his entire thesis, there is much more truth in what Hickey says than one would like to think.  Among other things, when healthcare becomes a right, then the more struggles of the normal human experience we decide to turn into a medical diagnosis, the more it becomes society’s obligation to alleviate those normal struggles. There is a natural endpoint to this process of over-medicalization, of course, but it is not pleasant to contemplate.

Dr. Wes speculates on what is really different about the new pacemaker leads which recently have been declared officially MRI-safe by the FDA. Wes suggests that much of the extraordinarily expensive and time-consuming effort that was made in obtaining the “MRI-safe” label had more to do with the incredible regulatory maze that had to be navigated, than with any actual engineering changes. DrRich, who a few years ago was peripherally involved as a consultant in a similar effort (with a different company), declares Dr.Wes’ speculation to be likely pretty accurate. But fear not, for Medicare will be reimbursing the manufacturer for its regulatory ordeal for many years to come.

The venerable DB of DB’s Medical Rants offers a timely rant about how those who create the clinical guidelines which dictate the practice of modern medicine often do so inadvisedly, and sometimes with their own (possibly cryptic) agenda in mind, and as a result of such guidelines, patients may die. DrRich himself has covered this same topic lately. DB’s commentary hits the mark.

Paul S. Auerbach of the Medicine for the Outdoors Blog provides this post on cholera vaccines. It turns out that cholera vaccination is a little less than straightforward, and given the relatively small amount of vaccine available worldwide, would not be suitable for wide-scale use. So as far as cholera prevention goes, pray for sanitation.

Rich Elmore and Paul Tuten at HealthcareTechnologyNews write the wonderful news that the Direct Project has launched. The Direct Project, they tell us, is an implementation of a secure, health-related e-mail standard designed to “allow health practitioners to securely exchange health data, medical records digitized to be easily shared between doctor’s offices, hospitals, benefit providers, government agencies and other health organizations, all across America.” This sounds like a pretty good idea, except perhaps for the “government agencies” part, since, for many of us, these are the very folks we’d least want looking at our most private personal information. As for the patients themselves, it is not clear whether they also will have ready access to all this extremely secure information about their own health, or whether instead they will have to wait until the information finally shows up on Wikileaks.

February 24 – DrRich has been petitioned by the authors to issue a correction for this last item. In order to do complete justice to them, DrRich reproduces their suggested correction in its entirety:

“The Direct Project encrypts the information being transmitted.  No one other than the intended received can get the information.  There is nothing stored using the Direct Project technologies – it serves only as a transport mechanism to enable, for example, a provider to securely send information to a consulting physician.  The goal is to replace the pervasive fax machine with something more secure, more modern and able to be used by healthcare stakeholders with the most basic technology (internet access and a PC) up to the most sophisticated user of an electronic health record.”

DrRich thanks the authors for correcting any misapprehensions he may have inadvertently introduced.  To be clear, when the Feds get your personal health information, and when you have difficulty obtaining it yourself, that will not be the fault of Direct Project, whose purpose is merely to assure that the data gets sent only to the person/agency which is targeted to receive it, and no one else.  DrRich leaves it as an exercise for his readers to determine whether his original commentary may still offer any value.

____

Thanks for speed-reading Medical Grand Rounds this week.

Next week Grand Rounds will be hosted by The Examining Room of Dr. Charles.

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Podcast:

The Constitutionality Briar Patch [ 11:35 ] Play Now | Play in Popup | Download (322)

“Drown me! Roast me! Skin me alive! Do whatever you please!” cried Br’er Rabbit. “Only please, Br’er Fox, please – whatever you do, just don’t throw me into that briar patch!”
- Joel Chandler Harris

Quite a lot has happened on the healthcare front over the holidays, even in addition to the Telltale Pacemaker story, and DrRich suspects that more than a few of his readers – busily eating, drinking and being merry – may have missed some of it. But fear not. DrRich is committed to catching you all up.

One story even the most dedicated of you revelers might have heard something about is that a U.S. District Judge, Henry E. Hudson, has declared the Obamacare individual mandate to be unconstitutional.

This ruling has no immediate practical result, since the individual mandate is not scheduled to go into effect until 2014. But Hudson’s ruling has given a great boost to Tea Partiers, certain Republicans, constitutional fundamentalists, and other recalcitrants who keep trying to disrupt the modern Progressive program by invoking the Constitution, and other old-timey scripture, written by slave-holding, wig-wearing, pompous old white men who didn’t even like each other very much, let alone Diversity, and who had never even heard of Twitter or Facebook or 4G networks, and whose scribblings therefore cannot possibly have anything important to say to modern-day people like us. In any case, Hudson’s ruling is not dispositive, and the matter of the constitutionality of the individual mandate will finally be decided in the U.S. Supreme Court.

In a related matter, also over the holidays, President Obama phoned the president of the Philadelphia Eagles to praise him for giving Michael Vick a second chance.

Some readers will not immediately see how President Obama’s phone call to the Eagles is relevant to Hudson’s ruling on the individual mandate, but that’s what DrRich is here for. You see, Dear Readers, Mr. Obama is a very brilliant and subtle man, whose actions and words can never be taken at face value, but which (like, as it happens, the actions and words of Christ) must be interpreted in the context of the entirety of his life’s work. Accordingly, his phone call to the Eagles can only be properly interpreted if one understands (as the President undoubtedly does) that Judge Hudson is the selfsame judge who sentenced Mr. Vick to the federal penitentiary for engaging in unsavory sporting activities involving dogs.

It should be clear then that President Obama’s real message, for those few of us who are perceptive enough to understand it, is: “Judge Hudson has a history of making rulings whose ultimate result is the precise opposite of what one might originally think. His Vick ruling was seen by everybody as an action that would ruin Mr. Vick’s career forever. But, as a result of that action, Mr. Vick dedicated himself as never before to becoming a great quarterback, and has already achieved heights he might never have reached if Hudson had been more lenient. So when Hudson says the individual mandate is unconstitutional, take heart! The final effect of his ruling will be – as in the case of Michael Vick – the opposite of what everybody thinks.”

The loud protests you hear from Mr. Obama’s side regarding the challenge to the constitutionality of the individual mandate, for the most part, are genuine. Most Progressives, lacking Obama’s subtlety, are outraged that something as important and as groundbreaking as Obamacare is threatened by mere scratchings made by old men in ancient days on a piece of cracked parchment. The official defense of the individual mandate made shortly after Hudson’s ruling, by none other than Kathleen Sebelius and Eric Holder, stresses this point. These eminences (one of whom is the Attorney General of the United States for goodness sake!) were utterly unable to come up with a legal or constitutional justification for the individual mandate, and based their defense entirely on the proposition that Obamacare is really, really important, and that the individual mandate is vital to Obamacare. The notion that if something is important enough the Constitution must be pushed aside (or, more accurately, “re-interpreted” in light of modern-day exigencies) is a given for Progressives, and they just don’t understand how any reasonable person could think otherwise.

Mr. Obama, DrRich believes, looks at it differently. Let us review some basic facts:

1) President Obama favors, and is working toward, a single-payer healthcare system. He has said so publicly many times. (Here’s one example.)
2) Obamacare places us on the road to a single-payer system – either a direct single-payer system run entirely by the government, or a single-payer system which is administered by minutely-regulated “health insurance utilities.”
3) The health insurance industry is currently running out the string on its fundamentally broken business model, and desperately needs Obamacare as a pathway to a graceful exit strategy.
4) The sole reason for the individual mandate was to get the health insurance companies on board with Obamacare, that is, the individual mandate buys the insurance industry a few more years of life – one last windfall – in return for which they will become heavily regulated utilities,  and likely avoid the ignominious and catastrophic failure their current trajectory suggests.
5) On the other hand, if we instead went to single-payer healthcare like the President and his Progressive friends want – such as Medicare for all – then the constitutionality of the individual mandate would immediately become moot.

If these facts – particularly the ones about the state of the health insurance industry – are correct (and DrRich believes he has amply demonstrated that they are), then declaring the individual mandate to be unconstitutional will actually play into Mr. Obama’s hands quite nicely.

If the individual mandate is declared unconstitutional and Obamacare becomes entirely defunct, the insurance industry will remain on their path to imminent disaster. They will be forced to price nearly everyone out of the insurance market, and themselves out of business, and we Americans will be left with no obvious choice but single-payer, Medicare-for-all healthcare by default, as the only obvious constitutional option. (There are, of course, other options – such as the one DrRich has proposed – but these likely will continue to be ignored.)

Mr. Obama will go on TV and say:

“We tried! Nobody can say we didn’t. We presented our nation with a healthcare plan that would cover almost everybody, and which would save the private insurance industry. But now, the actions of the Republican naysayers have destroyed the only mechanism that would have allowed the insurance industry to continue to function.  And now the insurance companies are falling like dominoes, and uninsured Americans will soon number over 100 million.  You and your loved ones and your neighbors face imminent death or disability from Republican neglect.  We must act, and we must act now.

“I and my Democratic colleagues did not want it this way. We fought hard for our centrist, market-based plan.  But our Republican opponents and their allies in the reactionary Court leave us no choice.  My fellow Americans, as a matter of national security, and of national survival, we must pass into law, within the next 30 days, my new program to expand Medicare to cover all Americans. All other paths have been closed to us. And if you don’t like it, as I myself do not, you know who to hold responsible at the polls.”

On the other hand, of course, the individual mandate may be declared constitutional by the Supreme Court. (DrRich does not understand how this could happen under the Constitution as written, and neither, apparently, does Mr. Holder. But given the “living document” proclivities of many justices these days, one must admit it is reasonably likely to happen.) And if the individual mandate is declared constitutional, then the federal government will have been granted the authority to dictate any behavior it wishes upon individual Americans, as long as those behaviors are deemed to be important enough by the government to the collective interest.

Either outcome to the constitutional challenge to the individual mandate, therefore, will be more than convenient to the ends of President Obama. He understands this very well as he stands there, entirely serene and above the fray, watching Sebelius and Holder, and his other minions, caterwauling over the constitutional challenge to the individual mandate.

“Please, Br’er Elephant,  whatever you do, please don’t throw my individual mandate into that briar patch!”

The obese, like the poor and the uninsured, will always be with us. And like the poor and the uninsured, the obese have served as a useful foil to healthcare reformers. But while their fellow foils are portrayed as sympathetic victims of hard-hearted right-wingers, the obese serve a different purpose. It it their role to illustrate for the rest of us how too much individual latitude invariably leads to bad choices (in this case, sloth, gluttony, greed and self-indulgence) which do grave harm to the collective; and which, for the good of the collective, justify (indeed, require) firmly (but kindly) applied limits on that individual freedom. In these articles, DrRich elaborates on the critical importance of demonizing the obese.

Defending the Demonization of Obesity, Part 1

Defending the Demonization of Obesity, Part 2

Don’t Sweat the Obesity Dividend

How Fat People Reduce Global Warming

Defending the Anti-Obesity Movement, Again

Why Big Health Insurance Supported Obamacare, Part III

Podcast:

How the Health Insurance Industry Saved Obamacare [ 18:24 ] Play Now | Play in Popup | Download (442)

When the time came, the support the insurance industry gave to President Obama’s efforts to reform healthcare followed four simple rules:

1) Do not actively oppose Obamacare. In stark contrast to its behavior during the Clinton’s effort to reform healthcare in 1993-94, this time the insurance industry never engaged its vast public relations resources to stifle healthcare reform.  There was no Harry and Louise this time. (Actually, Harry and Louise – the original actors – did make a brief appearance, but now, like the insurance industry itself, they were older, wiser, and sadder, and this time they fully supported the proposed reforms.)

2) Submit quietly to demonization.  A key strategy of the Democrats in passing Obamacare was to remind Americans repeatedly that the for-profit health insurance industry is fundamentally evil.  This strategy was based on the time-honored precept that it is easier to get the unwashed masses to cooperate through hatred than through reason, and so, to gain their cooperation, one must give them something to hate. Obviously, this strategy meant that the health insurance industry had to accept its role as the bad guys in the reform debates without complaint, and without engaging in any serious self-defense.

3) Offer subdued public support to Obamacare. The AHIP (America’s Health Insurance Plans) issued public statements that cautiously supported President Obama’s healthcare reforms. But its support had to remain subdued and tepid, since Satan can’t be seen leading the hymns.

4) Whenever necessary, rise up and demonstrate to the world just how evil you really are. At the end of the day, this was the most important role the insurance industry played in advancing Obamacare. It was certainly their most active role.

It was not a difficult role to fill. Since 1994 the health insurers had engaged in the sorts of truly evil, inhumane, and reprehensible practices that are naturally engendered by covert healthcare rationing, and that harmed or killed many of their subscribers. The only difficult part was choosing which reprehensible behaviors to feature, and when to do it.

In at least two key moments during the fight over healthcare reform – June, 2009 and February, 2010 – when the proponents of reform felt their momentum lagging, the insurance industry intervened with gratuitous behaviors whose chief function was to remind Americans just how unremittingly wicked and inhumane they really are. In the second case, at least arguably, the insurance industry turned the reform effort from apparent defeat to almost certain victory. Indeed, it is not too much of an exaggeration to assert that, in the end, the health insurance industry saved Obamacare.

June, 2009: Say Hello To My Little Friend

The debate over Obamacare entered a new phase in May and June of 2009.  It was during those months that the opposition to healthcare reform found its voice, and it began to seem as if perhaps the Obama steamroller could really be slowed, if not stopped. People were even beginning to say that many Democrats in Congress, after getting an earful from their constituents when they held their summer town hall meetings, would abandon any idea of supporting President Obama’s healthcare reforms.

Supporters of Obamacare decided it was time to invoke the demons.  So in mid-June, the House Subcommittee on Oversight and Investigations called three health insurers to testify on the practice of rescission, and to face not only indignant Congresspersons, but also some of the people who had been personally harmed by their practices.

“Rescission” is when an insurance company voids subscriber’s health insurance (after happily accepting premiums from that subscriber, often for many years) once they get sick. Under some circumstances, rescission might be justifiable. It is legal and proper to cancel a policy if the subscriber is found to have purposely lied on the insurance application about a prior illness that is material to the current illness.

But health insurance companies for years have actively and aggressively practiced rescission on subscribers whose insurance applications contained inadvertent and non-material inaccuracies.  (Just to put it in perspective, this kind of bad behavior is to be expected under a system of covert healthcare rationing, which again, is rationing by whatever means you can get away with.)

Furthermore, the health insurance industry does not merely engage in occasional unfair rescission practices; it has industrialized the process. It employs health insurance detectives whose job is to comb the prior medical records of subscribers who are newly diagnosed with certain, expensive medical conditions, looking for even trivial discrepancies on insurance applications, which they can inflate to “fraudulent” omissions, thus voiding the policy. These health insurance detectives are paid by commission, according to how much money their efforts can save the company. Many of them find it a very lucrative career.

So, at the cost of perpetrating a bit of inhumanity, rescission can save insurance companies a lot of money.

Consider some of the individuals who testified in Congress along with the insurance companies that day

• A nurse in Texas had her insurance canceled after she was diagnosed with breast cancer because she had failed to reveal that, years before, she had consulted a dermatologist about acne.
• A man (whose surviving sister had to testify) had his insurance canceled before he could begin expensive cancer therapy, because he had not revealed (and indeed he had not known) that a prior CT scan had showed gallstones and an aneurysm – conditions unrelated to his cancer.
• A woman had her insurance canceled – and due to the rescission could not find replacement insurance – because she failed to reveal that, at one time, she had been on medication for irregular menstruation.

During the hearing, the three health insurance executives were caused to listen to these and other incredible stories describing some of the inexcusable pain, suffering and death their unfair rescission practices had caused, and then were forced to listen to withering commentary by stunned Republicans and Democrats on the Subcommittee, whose own investigation had found that the three companies on the docket had retrospectively canceled the policies of 20,000 sick subscribers over the past 5 years.

After these heart-rending testimonies and the blistering attacks from extremely angry congresspersons, the executives were challenged by Chairman Stupak (D-Michigan) to now commit to discontinuing the practice of rescission unless intentional fraud could be shown.

All three replied, in turn, “No.”

Such a reply, in such a setting, almost defies belief. The only possible explanation, in fact, is that the insurance industry was stepping up to the plate, and embracing its assigned role as the Evil One in the great healthcare debate.

Even the most stone-hearted insurance executive can see that canceling the health insurance of a newly-diagnosed cancer patient, because she’d forgotten she’d required acne medicine before the prom 20 years ago, is just a bit unfair. But how did these three executives react? They did not attempt to deny such reprehensible behavior, or to explain it, or to defend it.  They were simply defiant about it.

One is put in mind of Tony “Scarface” Montana, bereft of friends, family, allies and bodyguards (albeit because of his own actions), hopelessly surrounded by an army of heavily-armed assassins, screaming, “Say hello to my little friend!” then launching defiantly into a wild, bloody and spectacular suicide.

One cannot for a moment believe that that Richard A. Collins, chief executive of UnitedHealth’s Golden Rule Insurance Co., Don Hamm, chief executive of Assurant Health, and Brian Sassi, president of consumer business for WellPoint Inc., would have been stupid enough to publicly defy Congress over such an indefensible practice, if doing so was against their own long-term interests.  Appearances to the contrary notwithstanding, they were not auditioning for a remake of Scarface.

This is not how an industry behaves which wants to court the goodwill of Congress at a critical juncture in its life cycle. This is not the strategy of an industry that wants Congress to defy its own party’s President and defeat healthcare reform, or that is begging Congress to give them another chance to figure out how to bring healthcare costs into check. This is not the behavior of any industry that wants to elicit any sort of favorable action from Congress. Indeed, these executives would have seemed more sympathetic and deserving if they had proposed instead to place live puppies on a spit and roast them over an open fire during half-time at the Super Bowl.

There is only one explanation for their astounding public defiance on this matter. Which is, it must have suited their long-term interests.

Recall that at the time of this remarkable hearing, there was growing skepticism about President Obama’s healthcare reform efforts, not only on the part of Republicans, but also on the part of a critical minority of Democrats in Congress. And for the first time since the election, there was some question about whether his reform plan would succeed in gaining sufficient support.

What must the health insurance industry do in the face of this faltering support for its desperate end-game? It must act to bolster Obamacare.

In this light the stark, defiant, public “no” uttered by the three insurance executives makes sense. “Look at us,” they were saying, “See how evil we are! We are utterly devoid of human decency, ethical obligations, or a sense of fair play. If we behave this defiantly when we are in the position of mere supplicants to your eminences, just think how we will behave if you fail to rein us in with new reforms!  Abandon all hope, those of you who rely on us for your healthcare, and behold the congressional dogs that placed us in this position of power over your very lives!”

Given the headwinds the healthcare reform effort was to face during the next nine months, it is difficult to say with any certainty how much good the insurance industry did in June, 2009, when it took such an extraordinary step to remind Americans just how incredibly evil it is. But when the time came to help boost the President’s reform efforts, nobody can deny that the insurance industry stepped up and did its duty.

February, 2010: Raising Obamacare From The Dead

Things looked especially bleak for healthcare reform in early February of 2010.  The incredible, possibly Constitution-defying, machinations Congress employed in its desperate attempt to pass healthcare reform had disgusted a majority of Americans, and momentum was clearly shifting to the opponents of Obamacare. And when Republican Scott Brown incredibly won the Senate seat in Massachusetts, robbing the Democrats of their crucial, filibuster-blocking 60th vote, many thought healthcare reform was dead.

But then out of nowhere, in early February, Wellpoint’s California subsidiary, Anthem Blue Cross, announced it was raising its already-astronomical health insurance premiums by as much as 39%, a move that promised to greatly increase the number of Californians who are uninsured.

The demoralized Democrats in the administration greedily capitalized on this new opportunity.

Kathleen Sebelius immediately fired off a very public letter to the company, demanding that they justify this unconscionable rate increase. And Wellpoint, lustily assuming its assigned role as villain, was delighted to reply, equally publicly.

We’re in a recession, Wellpoint brazenly asserted, and in a recession, like it or not, people exercise their prerogative to drop their health insurance. The only people who don’t drop their health insurance are the sick people, or those who are likely to become sick, which means that our cost per subscriber goes way up. So naturally, we have to increase premiums. By a lot. It’s just business. That’s just the nature of our current, unreformed healthcare system. So choke on it.

Wellpoint was also kind enough to mention (for anyone dense enough to have missed the point) that the need for higher insurance premiums would be nicely mitigated if everybody was mandated by the government to purchase health insurance.

Wellpoint’s anounced premium increase immediately triggered great volumes of delighted outrage by thankful Democrats, who desperately needed a large dose of “evil insurance company” at just that time. Wellpoint’s action reignited the proponents of healthcare reform, who were inspired to remind all Americans that this is what would happen to everyone if healthcare reform failed, and the greedy insurance companies had their way.

Stunned Republicans, seeing their impending victory over Obamacare evaporating before their eyes, could only issue a few lame and uncomfortable attempts to diminish the significance of Wellpoint’s unfortunate action.  But to little avail. The momentum had shifted. At least arguably, it was Wellpoint’s decision to announce an unconscionable rate increase at this extremely critical juncture that put healthcare reform back on the road to adoption.

From a pure business standpoint, there was no good reason for Wellpoint to stir the soup at that moment. Wellpoint is the most financially sound private health insurance company. While its California subsidiary did lose money in 2009, overall the company performed quite well, and reported a very nice profit growth for the year. And with several of its competitors in trouble, Wellpoint stood to do comparatively well for the foreseeable future.

Furthermore, it has since been learned that Wellpoint’s math was bad. An independent actuary working for the California Department of Insurance reported on May 5, 2010 that the company had made “numerous errors” in calculating is rate increases, and further, that Wellpoint could cut its rate hikes substantially, and still meet its required 70% medical-loss ratio threshold.

It stands to reason that if Wellpoint really wanted healthcare reform to go away, they would have first checked their math before announcing seismic rate increases, and then, if such astounding rate increases were really needed, they would have waited a few months – while Obamacare died – before announcing their rate hike.

The last thing they would have done is to throw the reformers a critical lifeline just as they were going under for the last time.

In any case Wellpoint’s action, especially at that moment, seems entirely gratuitous. Wellpoint could only have chosen to do its demon dance, at such an inopportune moment, in order to revive Obamacare during its darkest hour.

And that’s precisely what happened.

In the final post in this series of articles, we will take a look at the implications of the insurance industry’s support of Obamacare, as we who find Obamacare less than desirable contemplate what we ought to do about it.
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Why Big Health Insurance Supported Obamacare

Part I – Another Reason He Should Have Kept the Bust

Part II – Why the Health Insurance Industry Supported Obamacare

Part IV – What It Means That the Health Insurance Industry Saved Obamacare
________________________________

Now, read the whole story.

DrRich explains it all in, Fixing American Healthcare – Wonkonians, Gekkonians and the Grand Unification Theory of Healthcare.

Now on Kindle!

Why Big Health Insurance Supported Obamacare, Part II

Podcast:

Why the Health Insurance Industry Supported Obamacare [ 14:52 ] Play Now | Play in Popup | Download (541)

The fact that the health insurance industry supported Obamacare from the very beginning was entirely missed by the mainstream press. This is perhaps understandable, since a) the mainstream press does not understand the dynamics of the healthcare system, and b) during the Obamacare drama, the health insurance companies had been assigned, and had graciously accepted, their vital role as the Forces of Evil. To the famously credulous members of the mainstream press, it was easy to imagine that the insurers were actually among the opposition.

But the insurance industry supported Obamacare from the start – and even before the start. During the Presidential race of 2008, for instance, managed care companies donated far more money to both Barack Obama and Hillary Clinton than to any Republican candidate, even though both of these Democratic candidates publicly castigated the insurance companies for producing most of the problems in American healthcare, and promised to institute reforms that would drastically cramp their style and reduce their profits.

Why would the insurance industry support the very candidates whose chief healthcare strategy was to demonize them? Quite simply, it was because the insurance industry had nowhere else to go.

By the time Mr. Obama became president, the once proud, self-confident, and even arrogant American health insurance industry had been completely humbled. Like the old Soviet Union twenty years earlier, it still may have looked formidable from the outside, but it was really an empty shell.  The industry had run out its string; it was entirely bereft of ideas. Its business model was completely broken, and it desperately needed an exit strategy. And it was due to the need to find a serviceable exit strategy that the industry supported Obamacare.

To understand what landed the insurance industry in this sad state of affairs, it is necessary to review its recent history.

The Rise of the For-Profit HMOs

When the Clintons set out to reform the American healthcare system in 1993, the health insurance industry initially claimed to support them. The Clintons had promised them a vast new market – the millions of heretofore uninsured Americans whose premiums would be paid, presumably, by the government.

But the alliance fell apart the moment the insurance industry began reading the massive tome of regulations the Clintons finally produced, and found in it much they didn’t like. Chiefly, they they didn’t like the parts that ceded full control of their industry to the government. So Big Health Insurance immediately turned against the Clintons, and spent millions of dollars introducing us to Harry and Louise (a “typical” American husband and wife who were viewed in numerous TV commercials discovering various appalling provisions of the Clinton plan). In the end, when the Clinton’s reform plan went down to ignominious defeat, the powerful health insurance industry, appropriately, got most of the credit.

Most of us Americans were happy at the time that the Clintons’ plan had been defeated, but during the debate over healthcare reform we had become convinced that the old way of doing healthcare wasn’t any good either. The healthcare system, we all knew by now, was bankrupting us.  And something needed to be done about it. But with the Clinton plan off the table, what were our options?

In the ashes of the Clintons’ failed effort, the health insurers saw their golden opportunity.  And they presented the American people with a savior. The savior was, of course, them.

The insurance industry made its pitch in a new guise which we Americans had never seen before. For the big fee-for-service insurance companies had transformed themselves into HMOs, and had fully assimilated the language of managed care. These were not the touchy-feely, non-profit HMOs that had been puttering around in the healthcare system for a decade or so.  These were meat-and-potatoes, for-profit HMOs, run for the most part by hard-nosed business executives, and newly formulated for a new era of American healthcare.

And here is what they said: “Citizens! We all – employers, patients, physicians, hospitals, manufacturers and insurers – have just dodged a bullet. Thanks to us, the frightening socialist reforms of the Clintons have been soundly defeated. But where does this leave us? We stand now between Scylla and Charybdis, between the specter of nationalized healthcare on one hand, and the continued profligacy of traditional fee-for-service medicine on the other. And we cannot countenance either. But here,” they continued, “is a third way. A painless way, based on the sound principles of managed care, open markets, and free enterprise. Let healthcare become a business like any other business, and the market forces will find ways not only to cut costs but also to improve quality, and with no government intervention.”

The offer, in other words, was to turn healthcare over to the business professionals now running the New Model HMOs, who were cocky with the certainty that they could harness the efficiencies of the marketplace to control costs, make a big profit at the same time, and be feted as saviors to boot. Because we’re Americans and we know the benefits of capitalism, and because the other choices we faced looked even worse, we all said, “Go for it.”

This change led to the most rapid transformation the American healthcare system has ever seen, and within a few short years, the majority of Americans were enrolled in HMOs, or some other species of corporate managed care.

So HMO executives set out to control the cost of American healthcare, and to make a spectacular profit doing it. And for a few years, they seemed successful. Healthcare inflation slowed dramatically in the late 1990s, and HMO profits soared.

But it was all an illusion.

The Fall of the For-Profit HMOs

The initial impressive profitability of New Model HMOs was due to the one-time reduction in cost you always get when you implement efficiencies of scale (made possible by merging enterprises), and by instituting the new standardization techniques favored by managed care theory. These steps reduced the cost of healthcare for a while, but the underlying rate of healthcare inflation (which is mostly caused by new medical technologies and an aging population, neither of which are cured by managed care) was pretty much unchanged. So by the early 2000s, when these one-time cost reductions had been fully realized, healthcare inflation was right back on the same unsustainable trajectory it had been on before.

Unfortunately for the HMOs, the big profits they enjoyed throughout the 1990s could not last. Their rapidly expanding valuations were attributable not to their efficient management of healthcare, but instead, to the frenzy of mergers that rapidly ensued, and to the acquisition and privatization of not-for-profit public assets for a tiny fraction of their true value.

So not long after the turn of the century the for-profit managed care companies were getting very nervous. For the very first time in their history, HMOs were faced with the prospect of having to earn their profits, profits sufficient to satisfy their shareholders, by actually managing the healthcare of sick people. This is something they had never accomplished before, and, by the time the election of 2008 approached, they knew they never would.

By that time they had tried everything. Beginning in 1994, filled with confidence and enthusiasm and cheered on (initially, at least) by the public and by public officials alike, the health insurance companies had more than 15 years of more-or-less unfettered freedom to institute any efficiencies they wanted to. In the ensuing years insurance companies tried all kinds of legitimate ideas for reducing healthcare costs, such as managed care, gatekeepers, clinical pathways, disease management programs, pay for performance, wellness programs, medical homes, and even a ruthless consolidation of the industry to achieve “efficiencies of scale.”

They also tried every sneaky and underhanded idea they could think of for reducing costs, like cherry-picking the healthy patients, treating chronically ill patients like pariahs so they would go away, making access to specialty care as inconvenient as possible, forcing doctors to sign “gag clauses” to prevent them from telling their patients about certain treatment options, browbeating primary care physicians into zombie-like compliance with handed-down care directives, refusing to cover expensive-but-effective medical services, and canceling the policies of tens of thousands of patients after they get sick, based on trumped-up technicalities. Indeed, they tried everything short of dispatching teams of Ninjas in the dark of night to slaughter their most expensive subscribers in their beds.  And finally, when all else failed, they instituted huge and unsustainable annual increases in premiums, to the point of driving their customers out of the market. (This latter move, of course, was an open acknowledgment that the industry had entered its death spiral.)

All these efforts were to little avail. The cost of healthcare continued to skyrocket, entirely unabated. And by 2009, when President Obama began his push for healthcare reform, the insurance companies knew they had no prospect of long-term profitability. Their business model was no longer viable, and, while telling soothing stories to avoid shareholder panic, they were urgently casting about for an exit strategy.

A drowning man will cling to any piece of flotsam that comes his way.  What the insurance industry found floating by was Obamacare.

What Health Insurers  Get From Obamacare

In return for its support in the healthcare reform battle, President Obama offered the insurance industry the graceful exit strategy it so desperately needed.  Under Obamacare, for at least a few years the insurers hope to get One Last Windfall – namely, profits from the influx of previously-uninsured Americans whose premiums will be paid, or at least subsidized, by taxpayers.  Here, the insurers are relying on the likelihood that the inflow of new premiums will, for a year or two at least, greatly outweigh the outflow of money they will have to spend caring for these new subscribers. Obviously, they will use every trick in their well-worn book to stave off expenditures for these new subscribers for as long as they can, but if they actually knew how to avoid paying healthcare costs indefinitely, they wouldn’t be seeking a government bail-out today. In any case, an inflow of new subscribers will be a very temporary source of profit for insurers. Hence, at best it is One Last Windfall.

What happens to the insurers after they exhaust this last windfall is still up in the air. Obamacare may, of course, eventually transition to a single-payer system, an outcome which many conservatives desperately fear, and many liberals fervently desire. In this case, there may very well be some final compensatory buy-out (or a buy-off) for the insurance companies. But more likely, the insurance companies under Obamacare will continue to exist essentially as public utilities. That is, they will exist as companies chartered by the government, which administer healthcare under the direction of the government, with the products they may offer, the prices they may charge, the profits they may keep, and the losses they may incur, determined solely by the government.  It’s not glorious, but it’s a living.

And it’s much better than where they would have ended up without Obamacare. Which is why they supported it from the start.

Now that we know why the insurance industry supported Obamacare, in the next post we will explore how the industry, at no small cost to its own public image, supported the President when it counted most.

__

Why Big Health Insurance Supported Obamacare

Part I – Another Reason He Should Have Kept the Bust

Part III – How the Health Insurance Industry Saved Obamacare

Part IV – What It Means That the Health Insurance Industry Saved Obamacare

________________________________

Now, read the whole story.

DrRich explains it all in, Fixing American Healthcare – Wonkonians, Gekkonians and the Grand Unification Theory of Healthcare.

Now on Kindle!

Podcast:

More Evidence that Pay for Performance is Working [ 8:47 ] Play Now | Play in Popup | Download (395)

DrRich has long praised Pay For Performance as a particularly effective tool for covertly rationing healthcare.

Traditionally, pay-for-performance efforts (modeled after time-honored techniques used on trained seals), produce checklists of approved “activities,” which physicians of quality will always perform when engaged in a “patient encounter.” By examining filled-out checklists, the payers (both health insurance companies and the government) can thus determine which doctors are of sufficiently high quality to deserve their full reimbursement allotment, and which doctors are of substandard quality, and therefore deserve at least to have a portion of their reimbursement withheld, and possibly to be sent away for “re-education,” or to have their names published on a potentially embarrassing list.

When these pay-for-performance checklists are combined with the need to see one patient every 7.5 minutes, thus leaving no time for the discussion of health problems (or other issues) that the payers have not seen fit to include on their checklists, pay-for-performance becomes a very serviceable addition to the covert rationing armamentarium. Which brings us to the latest good news about the success of pay-for-performance.

This week, at Digestive Disease Week (the year’s major scientific gathering of gastroenterologists), doctors from Johns Hopkins will present a paper demonstrating that pay-for-performance reimbursement schemes create financial incentives for surgeons to shun obese patients.

Under this species of pay-for-performance, surgeons are “rewarded” (i.e., not punished) for meeting specified quality standards which have to do with certain patient outcomes. (For pay-for-performance to occasionally equate quality with outcomes is a particularly useful formulation, since expressing reservations about such pay-for-performance measures immediately brands one as being against good medical outcomes, in the same way that being concerned about illegal immigration brands one as being against immigrants, or having reservations about certain of President Obama’s policies brands one as being a racist.)

The Johns Hopkins researchers have found that performing surgical procedures on obese patients results in substantially more complications than performing the same surgical procedures on non-obese patients. For instance, fat people had 27% more complications after gall bladder surgery, and 11% more complications after appendectomy, than thinner people. They also had substantially longer hospital stays, and generated much larger medical bills. The researchers conclude that surgeons (some of whom are literate and understand rudimentary statistics, and therefore not only have access to this kind of information, but are also capable of processing it to at least some extent) can only conclude that, in order to maintain a viable surgical practice, they will need to avoid operating on obese patients. At the very least, they will need to avoid doing elective surgery on fat people, waiting instead until they are in extremis, and require emergency surgery (since at least some effort is made to “adjust” the expected outcomes in these situations).

This result, of course, is similar to the result DrRich reported some time ago regarding the publication of Physician Report Cards. Namely, thanks to publicly-available report cards, cardiologists in the state of New York have been more reluctant than cardiologists in other states to aggressively treat patients with severe heart attacks, and as a result (while the report cards are cleaner) the mortality of these patients is higher in New York.

And the situation with surgeons being quite similar (i.e., doctors being incented to avoid treating higher-risk patients, for fear of being punished because of an unavoidably higher rate of complications), DrRich feels quite confident in offering his surgical friends the same advice he offered the New York cardiologists. Namely, he suggests the Designated Driver strategy.

The Designated Driver strategy requires the Chief of Surgery (ideally, an imposing and feared figure) to approach a promising young surgeon who is just entering practice after the end of a very long course of training, and saying, “Son, you are going to have a brief but spectacular career. You are going to be our Designated Driver.”

For an extraordinary annual salary and immediate vesting in a generous pension plan, this young surgeon is going to have the honor of being the one who gets all the high-risk surgical cases for the group. He will agree to do this as long as it is feasible, that is, as long as he’s not run out of practice because his pay-for performance reports, or his physician report card, have become so abysmally bad. With careful management, and with his colleagues tossing him a few “easy” cases now and then in order to extend his longevity, he may be able to survive as a surgeon for five or ten years (longer, for instance, than the average NFL player), after which he can enjoy a lucrative retirement, or simply change careers. (There are obviously other approaches for conducting the Designated Driver strategy, for instance, as a way for surgeons nearing retirement age to go out in a blaze of glory. But you get the idea.)

The Designator Driver strategy is a win-win for everyone except the government – so surely it will eventually become illegal. But what doctors have to realize, when practicing medicine in a healthcare system driven by the covert rationing imperative, is that one either gives in to the bizarre incentives created by programs like pay-for-performance (which will cause measurable harm to their patients), or one fights back guerrilla-style, striking where one can, and changing tactics as the enemy adjusts.

To the government, however, such guerrilla activities amount to a mere nuisance, an annoyance which (like the poor and the uninsured) will always be with us. Looking at the big picture, our government will doubtless rejoice to hear the Johns Hopkins research results. The Feds will be particularly pleased to learn that their pay-for-performance efforts are achieving both of the desired effects (i.e., reducing the volume of elective surgical procedures, and advancing prospects for demonizing and discriminating against the obese.

Say what you will about pay-for-performance. It’s working.

Podcast:

Healthcare Reform Explained - An Updated Guide For The Perplexed [ 15:42 ] Play Now | Play in Popup | Download (195)

Now that the great campaign to transform the American healthcare system has passed a critical milestone – the passage of President Obama’s healthcare reform legislation – many Americans find themselves confused about what it all means. What just happened here? What will happen to our healthcare insurance? How much will it cost, and who will pay for it? Why does the whole process seem so darned difficult and confusing?

The confusion is quite natural, since, in fact, nobody really understands what the new legislation says. It is common knowledge that only one or two of our legislators actually read the whole 2700 pages, and those who did only read it so they could make trouble for the President at his Bipartisan Healthcare Roundtable this past spring. (You know who you are, Paul Ryan.)

Remember when Nancy Pelosi said, “We have to pass the bill so we can all find out what’s in it,” and all the Republicans jumped all over her for making such a stupid remark? Well, DrRich is here to tell you that Nancy was displaying uncommon wisdom. Because DrRich now has read large parts of the legislation himself, and can say with confidence that the bill is not merely lengthy, convoluted, and difficult to understand. Rather, its meaning is fundamentally indeterminate.

The indeterminacy of the bill’s language was, of course, intentional. It was done so that, for instance, some legislators could be assured that the bill disallowed Federally funded abortions, and other legislators could be assured that the bill encouraged Federally funded abortions, while the actual language of the bill could be construed to bolster either assertion. Therefore, Speaker Pelosi’s silly-sounding statement was not only correct, but also was probably the most insightful commentary on the bill we’ve heard from any public official.

The bill is now being torn into bits by multitudes of officious bureaucrats, and translated into millions of pages of rules, regulations and guidelines, and then key aspects of those new rules, regulations, &c. will be fought over in courts of law. Once all that is finished, we can all find out what was in it. Just like Nancy said.

In the meantime, whatever the details of our new healthcare system turn out to be, there is a certain clear narrative to our ongoing healthcare saga that, once you understand it, will go a long way toward enlightening you about what’s really going on.

And so, as a public service, DrRich will now explain all this to you in a very simple way, so that – whatever jive you’re hearing from politicians or journalists – you will always get it. For, once you understand a few key concepts, this thing is really pretty easy to follow.

The Fundamental Problem

The fundamental problem with American healthcare is this: None of the pools of money we have created (or ever could create) to pay for our healthcare – whether those pools of money reside with the insurance companies or the government or both – can possibly buy all the healthcare that might benefit all Americans. This means we have to ration healthcare (i.e., intentionally withhold at least some beneficial healthcare from at least some of the people who would benefit from it). But because we’re Americans and Americans don’t ration, we (and in particular, our political leaders) are unable to address this need to ration openly and forthrightly. Therefore, the unavoidable rationing is being conducted covertly.

Until now, most of the covert rationing has been overseen by the health insurance industry. This, indeed, from the very beginning was the primary purpose of modern health insurance companies, as determined by Congress itself when it legislated the formation of HMOs. (See the ruling of the U.S. Supreme Court in Pegram et al. v. Herdrich (98-1949), 530 US 211, 2000.) So, when the health insurers engage in cherrypicking patients, denying medically necessary services, coercing doctors to ration at the bedside, retrospectively canceling the policies of patients after they get sick, and doing everything short of dispatching teams of Ninjas in the dark of night to slaughter some of their more expensive subscribers in their sleep, they are not really being evil. They are only carrying out the job that had been assigned to them by our society. Covert rationing is a dirty, thankless job, but somebody’s got to do it.

The major sin of the health insurers is that, despite their Herculean efforts to harness covert rationing to control costs – and despite the wondrous incentive of greater profits if they do so – they have utterly failed in their assignment. Healthcare costs continue to rise at 3 – 4 times the rise in the cost of living, and within the next couple of decades promises to bring our republic to its fiscal knees (even without all the other stuff that’s making our deficit explode).

This is the healthcare crisis, and it’s real. We simply cannot actually spend $40 trillion on Medicare patients over the next three or four decades (as we’ve explicitly promised the baby boomers). The only real question is whether we will avoid spending all that money thanks to societal disruption and revolution, or by some more civilized means. (The fiscal implosion of our society would of course finally fix our healthcare crisis. Healthcare, far from being an essential and indispensable human need, actually is a luxury, a recent artifact of our advanced, stable, and affluent culture. Runaway healthcare costs, by bringing down our societal stability, will eventually provide its own cure.) Our current “healthcare reform process,” such as it is, is our stab at a more civilized means of addressing our looming impossible fiscal obligations.

What Is Healthcare Reform Actually Going to Reform?

What we are witnessing today is merely a rather messy changing of the guard. The primary responsibility for covert healthcare rationing is going to shift from the health insurers to the government.

The health insurance industry has run out its string. They have had 15+ years of virtually unfettered opportunity to get healthcare costs under control, and they have utterly failed. Over those 15 years, their attitude has evolved from arrogance to concern to abject fear. They finally and starkly realize that they have no clue as to how to control costs. As DrRich has pointed out for three years, the insurance industry has not been looking to block healthcare reform, but rather, was partnering with the reformers in the hope of finding for themselves a graceful exit strategy. They hope to gain one last windfall in profits and stock prices (from mandates and insurance subsidies for the tens of millions of currently uninsured Americans), and once that happens, they hope to settle into the business of administering, and processing transactions for, government controlled healthcare. That is, the insurers hope to become public utilities, since that’s way better than collapsing into oblivion.

So the overriding aim of healthcare reform, with the complete support of the insurance industry, is to conduct an orderly transfer of the pools of money with which we pay for our healthcare – along with the responsibility of managing “risk” and controlling the cost of care (i.e., covert rationing) – away from private insurers and to the government.

Understanding the Players

Government control of healthcare, of course, is precisely what the Republicans accuse the Democrats of wanting, and what the Democrats angrily deny they want.

Understanding the Republicans. Republicans as a group cling to the quaint notion that competition among insurers is all that is needed to reduce healthcare costs; that given the right market incentives, the insurance industry – in its wisdom – will bring healthcare inflation under control. They utterly fail to hear what the insurance companies themselves have said (by their actions): “No mas!”

The Republicans’ arguments ring hollow. It is useless to protest that the Democrat plans will lead to rationing, when not only do we already have rationing, but covert rationing in fact has been the official cost-cutting “plan” assigned to HMOs for decades now. It is useless to protest that 85% of Americans like their current health insurance, when the fiscal reality is that health insurance will change drastically for all Americans over the next decade or so, whether we change it by design or not. It does not matter that a lot of Americans like the health insurance they have now. Keeping it over the long term is not an option.

To a very large extent (DrRich is sorry to say, what with his conservative leanings and all), with such arguments the Republicans have made themselves nearly irrelevant in the current discussion.

Understanding the Democrats. The Democrats were handed the opportunity of a generation. They had a major advantage that Democrats of the Clinton era did not have: the health insurance industry is finished, and the industry knows it. The insurance industry was not going to let this effort fail.

The chief difficulty remaining for the Democrats is that (for their own survival) they must pretend they are not engineering a government takeover of healthcare, when in fact they are. As we have seen, there is not really much choice here. They must take over healthcare even if they don’t want to (though many of them do), because the health insurance industry is finished. The pretense is necessary, however, because the notion of government-controlled healthcare is not something the people – or even many Democrats – want, or are willing to tolerate.

Like the odious job of rationing healthcare (which they have now inherited in entirety), the Democrats must attempt to keep the complete government takeover of the healthcare system as covert as possible.

Which brings us to the biggest problem of all for the Democrats. They now have to take control of covert healthcare rationing. Covert rationing will be much more difficult for a government-run system than it has been for insurance companies. A government healthcare system will not have the opportunity to incorporate the most effective rationing techniques that have been available to the insurance industry – cherrypicking patients, for instance, or canceling the policies of people who get sick. Nor will the government be able to get away with summarily denying patients needed medical services – a standard tactic of HMOs. This is especially true now that chief Republican intellectuals have called everyone’s attention to the possibility of death panels. The unwashed masses, having been duly alerted to the government’s intentions of withholding life-saving healthcare, will now be on the lookout for “unreasonable” denials of care. Any move by the government to refuse to pay for a particular medical service will have to be supported by extremely convincing clinical data (which itself will be very expensive to collect), and even then Americans may not quietly accept such denials. The “death panel watchdogs” will be alert for every move the government makes, and will be quick to howl an alarm.

So the Democrats have won a huge and historic victory. But they are just beginning to figure out what a tiger they have by the tail.

The Bottom Line

As long as we pretend we don’t have to ration our healthcare, any reforms we invent – whether we do it as Republicans or Democrats – will merely add to the confusion, inefficiency, waste, inequity, and ineffectiveness of our healthcare system. How anyone can think that a process so fundamentally grounded in obfuscation and deception as the one we’ve just witnessed will result in anything good is quite beyond DrRich’s comprehension.

Real reform would require us to:

A) Minimize the necessity of imposed rationing by having patients themselves make as many of the spending decisions as possible, using their own money. (Subsidies could be provided to people who don’t have enough of their own money to pay for routine healthcare.)

B) Provide everyone with a high-deductable, catastrophic insurance product to cover non-routine medical expenses. This is where the necessary rationing would take place, but the rationing would be open, transparent, and determined through a public process.

C) Create a private market for “extra” health insurance for those who choose to supplement the universal catastrophic plan with their own funds.

But of course, any plan that relies on both personal responsibility and open rationing is a non-starter. Which is why we are going to get what we are going to get.