You are currently browsing the category archive for the ‘Health Savings Accounts’ category.

Jean, an Arizona teacher whose employer provided group health benefits but did not contribute to the cost for family members, gave birth to her daughter, Alex, in 2004 and soon after applied for an individual policy to cover the baby.  Due to time involved in the medical underwriting process, the baby was uninsured for about 2 weeks. A few months later, Jean noticed swelling around the baby’s face and eyes.  A specialist diagnosed Alex with a rare congenital disorder that prematurely fused the bones of her skull.  Surgery was needed immediately to avoid permanent brain damage.   When Jean sought prior-authorization for the $90,000 procedure, the insurer said it would not be covered.  Under Arizona law, any condition, including congenital conditions, that existed prior to the coverage effective date, could be considered a pre-existing condition under individual market policies.  Alex’s policy excluded coverage for pre-existing conditions for one year.  Jean appealed to the state insurance regulator who upheld the insurer’s exclusion as consistent with state law.

From a 2005 Wall Street Journal article

People hate Obamacare. People in “real” America really hate Obamacare. Kaiser Family Foundation convened a series of focus groups in counties that voted for Trump to find out what EXACTLY Trump voters hated about Obamacare (article found here).  They hated that those that were really poor and on Medicaid didn’t have the same barriers to care (high co-pays and deductibles) as did those who were working hard. This was even when the groups included voters on Medicaid. They hated how expensive their premiums were, how high their co-pays were, and how much was not covered. They hated how complex the system is and how when you think you have it figured out someone throws another thing at you. They hated the mandate to purchase insurance.

There is currently a bill  being formulated to “repeal” significant parts of the ACA and replace it either with a “To Be Named Later” or with a mismash of proposals which would be labeled “replacement.” How pre-existing conditions fit into this bill remains unclear but is worth understanding (Kaiser article here). Prior to the passage of the ACA, insurance companies were state regulated, and in all states were able to do medical underwriting, This meant that they could effectively eliminate people with preexisting conditions. Although it would be possible to repeal the ACA and keep in the current underwriting rules, it is not likely this will happen. In the case of our pre-Obamacare insurance at our work, the “lookback” was “270 days, known or unknown, manifest or unmanifest.” This meant that, the human gestation being 270 days from conception, if you had your first day of work and went home and celebrated with your significant other (and one thing lead to another) you had best hope the baby was a week late. If not, you were paying cash. Much worse was the patient we had whose cancer was manifest 4 months after his employment commenced and we got to tell him that he had to pay $100,000 up front or die of his cancer. Kaiser estimates that 52 million people will be denied coverage if the old rules are put back into place. Perhaps not denied outright but effectively denied by bringing back these old favorites:

  • Rate-up – The applicant might be offered a policy with a surcharged premium (e.g. 150 percent of the standard rate premium that would be offered to someone in perfect health)
  • Exclusion rider – Coverage for treatment of the specified condition might be excluded under the policy; alternatively, the body part or system affected by the specified condition could be excluded under the policy. Exclusion riders might be temporary (for a period of years) or permanent
  • Increased deductible – The applicant might be offered a policy with a higher deductible than the one originally sought; the higher deductible might apply to all covered benefits or a condition-specific deductible might be applied
  • Modified benefits – The applicant might be offered a policy with certain benefits limited or excluded, for example, a policy that does not include prescription drug coverage.

Some have suggested that a “high risk pool” would allow these folks to obtain coverage and keep the cost down for the 50% of the population who have no need to access the healthcare system in a given year. We actually tried that before, turns out. As the Kaiser article points out, these didn’t work for a number of reasons. First is the nature of health care expenses. Some folks have a lot of expense in a single year (car crash) and the next year are perfectly fine. Others have a lot of expense in an ongoing fashion for a very long time (think Magic Johnson and HIV).

Planning for these disparate situations was tough and no one got it right. The reasons for failure included:

  • Premiums above standard non-group market rates – All cost a lot, the states with the most success provided a substantial subsidy.
  • Pre-existing condition exclusions – Once again, how do you deal with folks who wait until they get sick to pick up a policy
  • Lifetime and annual limits – Most ranged from $1 million to $2 million and others imposed annual dollar limits on specific benefits such as prescription drugs, mental health treatment, or rehabilitation.
  • High deductibles – The plan options with the highest enrollment had deductibles of $1,000 or higher.

The conclusion was that they could work but it’ll cost a lot to get it right.

Back to the focus groups. What Trump voters said they wanted was low premiums and little out-of-pocket expense for drugs, visits, and procedures. They wanted no mandate and no increase in taxes but felt that not covering pre-existing conditions was “un-American.”

They expressed confidence that as a businessman President-elect Trump could pull this off. Hope they are correct.

I had to quit my job because of the stress I had to endure was putting me at high risk for a stroke or heart attack and I couldn’t physically keep up anymore
I’m 56 years of age
My job was 32 hours a week
But because of Obama care my insurance was costing me $600 dollars a month for just major medical!
No dental no eye care no life insurance
So by the time I paid my rent, electric, water, sewer, garbage, car insurance, house insurance etc, I had enough money to put gas in the car to get to work and buy ramen noodles and some cheap hot dogs for food!
Over 60% of my net pay went to insurance that covered nothing!
Now I am unemployed with ZERO insurance
Its pretty damn sad when all the damn medicaide and dissabilty cheats are eating steak with perfect teeth and new glasses and are in perfect health while I have to bust my damn ass just to eat ramen noodles wityh bad teeth , basbasd eyes, and life threatening health problems!!

So here I am, no job, no insurance, no hope

Patient’s story as posted on Obamacare stories

The average household income in the United States is $51,000. From that you pay for our food, shelter, children’s education, and movie tickets. Oh, yeah, and $5000 for a health insurance policy. One of the things that Obamacare did was begin to put a cost on our insatiable healthcare consumption. Turns out, that cost is VERY high.

If you are an average American, boy are you ticked off. Half of all Americans spend under $400 a year on healthcare. Pretty much a round of antibiotics for a sinus infection and, for women, a year’s worth of contraception. Not only that but because of high deductibles (to keep the cost down by discouraging consumption) you are paying $5,000 to the insurance company AND paying cash for your sinus infection visit and medicine. Then there are the drug companies and insurance companies that are colluding to raise the prices of formerly cheap antibiotics to get even more of your household income.

About 1% of the people in this country account for about a quarter (27%) of the health care spending. In 2014, this  was about $100,000 per sick person. Those in the top 5% of sick people were responsible for  almost $50,000 in health care costs. These numbers are unchanged since Obama was elected. So what has changed? Before, the costs of these people were hidden. They would get the care for “free” at a safety net hospital who would get money in other ways to pay for it. Or a sick person would use an insurance card then the payment would be denied as a pre-existing condition and the hospital would eat the cost. More likely, the sick person would get on disability, suffer for 2 years, and become Medicare eligible so we the taxpayer would pay. The care still cost money but was hidden in taxes. Insurance companies kept costs low, in other words, by shifting them to the federal government. Now folks under 65 who are sick can pick up an Obamacare policy and get exceptional care. Also on Obamacare stories are ones like this:

Thank you President Obama thanks to your healthcare plan I was able to continue to see specialists, this resulted in a diagnosis of a rare intestinal infection and even more concerning, two stage three colon cancer tumors, one on each side on each side of the colon. This required almost total colon removal from a top notch physician that was able to do my surgery without having to have a bag.

Only problem is, this type of care costs A LOT more than $5,000. .

So, if you bought an Obamacare policy and feel ripped off, let me tell you what your $5000 paid for. It wasn’t eye glasses and dental work for poor people that jacked up your bill. You spent your $5000 on people under 65 with heart disease and lung disease. You purchased them a lot of expensive tests, some time in the hospital, and some expensive drugs. You paid for the person with breast cancer’s $300,000 tab whose $5000 premiums were paid by the cancer treatment facility.  You paid for the person helicoptered in after rolling their car on Interstate 65 while trying to avoid a deer.  You paid for some very expensive medication for people with mental illness to keep them out of a mental hospital.

Did you pay too much? Yes. Other countries can do the same thing better for half as much or less. Perhaps the new adminstration will look at this as an opportunity to further retool our expensive, not very effective care delivery system and reign in some of the profiteering. Or maybe we’ll just continue to blame the poor…

 

Healthcare is almost 20% of our economy. A future President Clinton or a future President Trump will, through executive action, have a lot to say about how that money is spent. Commonwealth fund (found here) has an exceptional comparison of the two candidates’ proposals and how they would effect the budget. If you care about fiscal responsibility, for the record, the balance sheet is found below:

screen-shot-2016-10-10-at-3-28-22-pm

So, the Trump plan is not, despite what he claimed in the debate, the way to fiscal solvency.

Kaiser Family Foundation has put together a specific list of issues (found here) that folks appear interested in and has evaluated each camp’s claims.  The Cliff’s notes version is as follows:

Health insurance coverage and cost – Issues include overarching reform of health system remains unpopular in a partisan manner. Affordability hampered by a glitch where family coverage became more expensive, “cost sharing” was not controlled by the law, enrollment was not implemented well, and transparency provisions not implemented. Market place competition is limited, especially in rural areas.

  • Clinton
    • supports policies to maintain and build upon the ACA.
    • increase premium subsidies in the marketplace so no participant is required to pay more than 8.5% of income for coverage.
    • fix the “family glitch” and allow people to buy coverage through the marketplace regardless of their immigration status.
    • make a public plan option available in every state and give people the option of buying into Medicare starting at age 55.
    • invest $500 million annually in outreach and in-person assistance to enroll more uninsured in coverage, and she would enforce ACA transparency provisions.
    • authorize the federal government to review and disapprove unreasonable health insurance premium increases in states that do not have such authority, repeal the Cadillac tax.
    • proposed new private plan standards to waive the annual deductible for at least three sick visits per year, limit monthly cost sharing for prescription drugs to $250, and protect against surprise medical bills when patients inadvertently receive care out of network.
    • proposed a new refundable tax credit of up to $5,000 to subsidize out-of-pocket health expenses (including premiums in marketplace plans) for all Americans with private insurance.
  • Trump
    • complete repeal of the ACA, including the individual mandate to have coverage.
    • create high risk pools for individuals who have not maintained continuous coverage.
    • provide a tax deduction for the purchase of individual health insurance.
    • promote competition between health plans by allowing insurers to sell plans across state lines; an insurer licensed under the rules of one state would be allowed to sell coverage in other states without regard to different state laws that might apply.
    • promote the use of Health Savings Accounts (HSA), and specifically would allow tax-free transfer of HSAs to all heirs.
    • would also require price transparency from all hospitals, doctors, clinics and other providers so that consumers can see and shop for the best prices for health care procedures and other services.

Medicaid – Issues include states’ concerns regarding financing and unwillingness to expand to those too poor to qualify for a tax rebate required coverage

  • Clinton
    • encourage and incentivize states to expand Medicaid by providing states with three years of full federal funding for newly eligible adults, whenever they choose to expand.
    • would also continue to make enrollment easier and launch a campaign to enroll people who are eligible but not enrolled in coverage.
  • Trump
    • supports a Medicaid block-grant and a repeal of the ACA (including the Medicaid expansion).
    • would cover the low-income uninsured through Medicaid after repealing the ACA.
      • The House Republican Plan, which is part of a larger package designed to replace the ACA and reduce federal spending for health care, would offer states a choice between a Medicaid per capita allotment or a block grant.

Medicare – Issues include prescription drug costs, fate of provisions in ACA, public option for those 55-64

  • Clinton
    • supports maintaining the current structure of the Medicare program and opposes policies to transform Medicare into a system of premium supports. On the issue of prescription drug costs
    • supports allowing safe re-importation of drugs from other countries, allowing the federal government to negotiate drug prices in Medicare, especially for high-priced drugs with limited competition, and requiring drug manufacturers to provide rebates in the Medicare Part D low-income subsidy program equivalent to the rebates provided under Medicaid.
    • does not support repealing the ACA or any of the Medicare provisions included in the law; rather, she supports expanding the law’s value-based delivery system reforms.
    • proposed to allow people ages 55 to 64 to buy into Medicare.
  • Trump
    • No position on the issue of Medicare program restructuring or whether to allow older adults ages 55 to 64 to buy in to Medicare.
    • supports repealing the ACA, which would presumably mean repealing the law’s Medicare provisions.
    • supports allowing safe re-importation of prescription drugs from other countries.

Prescription drugs – Issues are pricing (generally more expensive in US than in other countries despite being manufactured in the same facility) and out-of-pocket costs (many plans have gone to a cost sharing rather than a deductible strategy

  • Clinton
    • proposes prohibiting “pay-for-delay” deals whereby companies make payments to competitors for agreeing to delay market entry
    • increasing funding for the FDA Office of Generic Drugs to reduce their approval backlog
    • reducing the market exclusivity period for biologics
    • and directing the FDA to prioritize biosimilar drugs with few competitors. To address price increases for generic drugs
    • proposes to establish consumer oversight in federal agencies
    • penalize drug companies for unjustified price increases
    • allow importation of lower-cost drugs from countries with similar safety standards.
    • She also supports eliminating tax deductions for direct-to-consumer advertising
    • requiring FDA approval of advertisements
    • tying federal support for drug companies to their investment in R&D
    • increasing transparency of the additional value new drugs have over existing treatments
    • allowing Medicare to negotiate drug and biologic prices. To address OOP spending on prescriptions,
    • proposes a $250 per month cap on cost sharing for covered drugs; and a rebate program for low-income Medicare beneficiaries that mirrors those in Medicaid.
  • Trump
    • supports allowing importation of drugs from overseas that are safe and reliable but priced lower than in the U.S.
    • supports greater price transparency from all health providers, especially for medical exams and procedures performed at doctors’ offices, clinics, and hospitals, but does not specify whether this policy would also apply to retail prescription drugs, which typically are not considered services or procedures.

Opioid epidemic – Issues include increased use (1 in 20 nonelderly adults used opioids for nonmusical purposes), increased addiction ( 2 million non elderly adults with of the level of opioid use increases to the level of opioid use disorder, often referred to as abuse, dependence, or addiction), increases in overdose deaths (those involving opioids have quadrupled since 1999).

  • Clinton
    • released a $10 billion (over ten years) plan to fight drug addiction.
      • includes a federal-state partnership to support education and mentoring programs
      • development of treatment facilities and programs
      • efforts to change prescribing practices, and criminal justice reform.
      • direct federal action to increase funding for treatment programs
      • change federal rules regarding prescribing practices
      • enforce federal parity standards
      • promote best practices for insurance coverage of substance use disorder services
      • issue guidance on treatment and incarceration for nonviolent and low-level federal drug offenders.
  • Trump
    • Will build a wall on the U.S.-Mexican border
      • will help stop the flow of drugs and thus address the opioid epidemic.

Reproductive health – Issues include access to preventive services, publicly funded family planning, and abortion services

  • Clinton
    • supports policies that protect and expand women’s access to reproductive healthcare, including affordable contraception and abortion.
    • defends the ACA’s policies, including no-cost preventive care and contraceptive coverage. promised to protect Planned Parenthood from attempts to defund it and would work to increase federal funds to the organization. called for the repeal of the Hyde Amendment which she believes limits low-income women’s access to abortion care.
    • would appoint judges to the Supreme Court who support Roe v. Wade, ensuring a women’s right to choose an abortion.
  • Trump
    • called for defunding Planned Parenthood if they continue to provide abortion
    • He states he is pro-life but with exceptions when the pregnancy is a result of rape, incest, and life endangerment.
      • has promised to appoint pro-life justices to the Supreme Court that seek to overturn Roe v. Wade
    • would also work to make the Hyde Amendment permanent law
    • would sign the Pain-Capable Child Protection Act, legislation that would sharply limit access to later term abortions.
    • would also repeal the ACA, which would eliminate minimum scope of benefits standards such as maternity care in individual plans and coverage of no-cost preventive services such as contraceptives in private plans.

 

 

How can Dr Carson be leading in a national poll for president and get a pass on a some, well, scientifically suspect beliefs such as “his statement in the wake of the Oregon mass shooting that it would be advisable to attack an armed gunman during a mass shooting ‘because he can’t get us all‘?” Or. how can folks want a president who is doing infomercials on neutraceuticals which misrepresent scientific fact and when called on it, deny having been paid for what was almost certainly a paid gig?

The New York Times gives a plausible answer to this question today. Ishani Ganguli, a Boston internist with an interest in health policy, points out that, pretty much, physicians get a bye:

  • He points out that we are trained to speak authoritatively regardless of the certainty of the situation or the strength of the evidence. In other words, as I tell my residents, “patients and attendings smell fear.”
  • He points out that surgeons are trained to believe that their skill is what stands between the patient and death and the loss of that faith leads to a crisis, one that a successful surgeon may never experience. He or she may not be good (and there is now a scorecard to look at) but will never admit defeat.
  • Doctors should never be politically correct, or so they are portrayed in the media (see House, MD),
  • There is a long line of physicians who are given a pass (see Dr Oz for the latest example)

Dr Ganguli points out that we as a society feel the need to ascribe trust to the MD. Our Hippocratic sales pitch has been an effective marketing strategy. He goes on to point out that self reflection and knowing our limits are keys to maintaining this trust. I am afraid that these are qualities Dr Carson does not have.

139263_600Ben Carson on setting up health savings accounts in a post Obamacare world:

“You also give people flexibility to transfer money within a family. So if you were $500 short, your wife could give it to you, your daughter could give it to you, your uncle, your cousin.”

Me in conversation with a fellow who is homeless and suffers from a terminal illness last week:

“Can you give me a ride? I sleep in a cot in the shelter down the way. I worked all my life until I got sick. Just got discharged a week ago from the hospital. Can walk about a half a block before I have to rest. I spend my morning walking to the this place for food.”

Me: “How long does it take you?”

“Oh, all morning. It’s about 3/4 of a mile. I spend the afternoon walking back. The give me a lot of medicines but when I run out I end up back in the hospital”

From a blog on population health

…..success (in lowering healthcare costs and increasing quality of healthcare/better outcomes for patients) …will require the ability to embrace the messiness of disease and the complexity of patients, rather than providing idealized solutions that impress in the boardroom but flop in the examination.

It is refreshing not to have a wonkish campaign for the Republican nomination. Both 8 years ago and 4 years ago terms like “bending the cost curve” and “medical loss ratio” were being used by the actual candidates. Voters don’t want to hear that. They want common sense solutions for common sense problems. For healthcare, the answers are simple—after all, we’ve all been to the doctor, right? Make the sick folks make choices. Get ’em out and working. Since Dr Carson is, well, a doctor, his common sense answers are just the prescription for our sore ears.

As found here, he feels that Health Savings Accounts for almost all are just what the doctor ordered:

ObamaCare, he opines, is way too restricting. Why should people need to have the details of what they purchase?

A major problem is that many people in our entitlement society see nothing wrong with forcing others to provide for their desires. In a free and open society, anyone should be able to purchase anything they want that is legal.

Given enough freedom, the invisible hand will sort things out:

Most people will want to get the biggest bang for the buck and will independently seek out both value and quality. That, in turn, will bring all aspects of medicine into the free-market economic model, thus automatically having an ameliorating effect on pricing transparency and quality of outcomes.

In addition, the miracle of compound interest will overcome the human predisposition to become sicker as we get older:

If accounts are established at the time of birth, they will be even more potent because the vast majority of people will not experience catastrophic or even major medical events until well into adulthood. By that time, a great deal of money will have accumulated.

Lastly, Americans are generous to a fault and will contribute to a fund if it goes to those who are deserving:

The 5 percent of patients with complex pre-existing or acquired maladies would need to be taken care of through a different system, similar to Medicare and Medicaid, but informed by the many mistakes in those programs from which we can learn. Even this kind of system should have elements of personal responsibility woven into it.

Problem is, facts really get in the way of an attractive market-based narrative:

  1. Healthcare in this country costs about $8,000 annually for each man, woman, and child, of which the government currently pays around $5,000.- President Carson would put $2,000 into everyone’s account. Already he’s saved us money!
  2. Five percent of the population accounts for almost half (49 percent) of total health care expenses with most of those people being on Medicare or Medicaid.- Um, does that mean we bonus everyone $2,000 and then have to pay the same amount for folks on Medicare anyway? Or does their account magically grow? 
  3. The lower 50 percent of spenders accounted for 3 percent of the total national health care dollar.- Uh, oh, here’s a problem. We have taken this money out of health care and moved it into a savings account for healthy people.
  4. High spending persists over multiple years for many patients, while others return to more normal spending levels after an expensive episode. There is also evidence that high spending occurs near the end of life for many patients, particularly within the Medicare population- Well, this is a problem…what happens when the savings account runs out? I guess they are walking to the homeless food site.

Interestingly, Dr Carson performed operations that cost the patient’s insurance $3,000,000 on a routine basis. He never published his results, but the operation he became famous for (separation of twins joined at the head) apparently has a mortality of 50%, and an unknown but high rate of severe disability. It is clear that informed consent remains a real problem regarding outcomes without surgery. Since these operations occur in the first year of life, the twins could kick in the first $4,000 from their HSA. Wonder if having to collect $2,996,000 from the health savings accounts of 1498 of the parent’s closest friends and family would make a difference?

Me, I’m now into the Donald’s plan:

Trump said that the Affordable Care Act has “gotta go” and that he would repeal the law and replace it with “something terrific.”

GhostScrooge was better than his word.  He did it all, and infinitely more; and to Tiny Tim, who did not die, he was a second father.

Charles Dickens, A Christmas Carol

The Governor awoke at midnight on January 1, the first full day of Obamacare and shivered. He knew that people who did not deserve healthcare would be getting it starting now. He could hear the clock chiming the quarter hour in the mansion and suddenly felt a cool chill. “Jefferson Davis, you leave me alone” he said.

“I am not Jefferson Davis, I am the ghost of healthcare past”

“”Hippocrates?”

“No, YOUR healthcare past. Come”

They wonder into a Birmingham that no longer exists and saw the poor in the University Hospital. The Governor pointed to them and said to the ghost “see how well they are cared for. Most could not pay for their care and yet we cared for them as if they were our own family.”

The Ghost says “If they were fortunate enough to get here, you provided care, sure. In exchange they gave you their bodies for you to practice on. Is that a good trade off? Marion Simms, one of your fellow Alabamians practiced on slaves without anesthesia so he could repair white women with anesth…”

“Hold on a minute, I thought you said this was MY past”

“Point taken…”

The Governor was silent. He saw poor people in open wards with wounds that will never heal because of poor nutrition. He saw medical students doing operations with no supervision. He saw people dying of pneumonia because they were placed on the wrong antibiotics.

“Enough. I don’t like this. I went into dermatology for a reason.”

They then wondered over to Tuscaloosa.”Hey,” said the Governor,”there’s my old practice. Never needed to take insurance and sure had no call for them gummit programs. I’d see patients for free if they needed my care”

The ghost held up a web page “This says your practice takes Medicare, Medicaid, Humana Military, and Tricare. Aren’t those “gummit” programs?”

“Point taken”

They go to the Druid City Emergency Rooom and see a person with an obvious skin cancer who is uninsured being told that he’ll need to bring $400 to have his dermatologic surgery in Tuscaloosa or else drive to the residency clinic in Birmingham. They can tell that he doesn’t have the transportation and likely won’t go.

“Remove me,” the Governor said, “I cannot bear it.”

The ghost says “I will, but because of budget cuts I have to be the ghost of  health care present as well.”

“Say what?”

“I ran across a copy of “Putting Alabama Back to Work” and we think you should be reminded of what you said you would accomplish in regards to health care as Governor in 2009 (before Obamacare was passed):

  • Encourage health savings accounts – present in ObamaCare
  • Reject ultraliberal single payer – again, ObamaCare
  • Prohibit any person from being compelled to participate in any health care system – Obamacare
  • Portability of insurance across state lines – could work with ObamaCare, understand Blue Cross of Alabama had a little something to say about that.
  • Tort Reform – with the entire legislature Republican you should be able to do that. What’s the hold up?
  • Change Medicaid awards so that those states with more poor people get more Medicaid – Didn’t Obama try to do that for you?
  • Establish state run exchanges – uh, this is getting kind of redundant
  • Tax relief for individuals who own their own insurance plan – ok, now this is getting scary
  • Electronic medical record support
  • More primary care physicians”

“What can I say, I was a very forward thinking candidate”

The Governor goes back into his room and waits. Another cold chill hit him. An apparition enters.”Now, YOU’RE Jefferson Davis’ ghost”

“No. I am the ghost of healthcare future. I could show you a bleak world where people who make over $3000 but less than $30,000 a year are denied healthcare and left in counties devoid of health professionals to sicken and die, but I won’t. I am going to assume you meant it when you said you were a forward thinking individual and made those promises and you just let things get away these last three years. Let’s see what the future can hold…”

They fly over to the Department of Public Health and Medicaid Transformation and things are hopping. The director is excited at the new world of data. They overhear him say

“We measure the right thing over time, reassess and trend what we are measuring, and bring the measurements to the attention of the governor and the legislature every chance we get. If it is easy to measure, we measure it a lot. We have counties in Alabama where infant mortality rivals Zimbabwe. These numbers used to be hidden in a report on page 133. We are making them a part of the policy conversation. We have the opportunity to decide if we want to be better or not.”

They then go into another office in the same building where they see folks looking to other states and even other countries for solutions. Why? They hear

“Don Berwick said we “Yanks” have ignored lessons from other countries. Paul Grundy of the Patient Centered Primary Care Collaborative has been going about singing the praises of Denmark (and it is a compelling story) but we’ve discovered that even in countries with universal access, disparities exist. In England, for example, income predicts poor health outcomes nearly as well as it does in Alabama. We need to look for answers outside the box.”

They then move down the cramped hall to the newly established Office of Patient Engagement (thought to be important in reducing peoples “risk factors” such as obesity and lack of exercise.” The director is already letting her staff know that the Office is obsolete

“We need to move beyond patient engagement. This is a term that implies a lone patient overcoming adversity to move singlehandedly into better health. Let’s acknowledge that “It takes a village.” The lesson of Portland and other communities is that healthy people lead to more healthy people. The lessons of McAllen TX and Grand Junction CO is that the right doctors can keep patients from iotrogenic harm and the wrong doctors, well, the opposite is true as well. The community needs to be healthy together…”

The Governor awakens and looks out the window. The camellias are in bloom. He looks over towards the hospital. The doors seem to be still open. He calls out to his aide “What year is this?”

“2014” the aide yells back.

“And ObamaCare?”

“Still the law”

He calls the Health Officer:

“Don, the good news about being way behind is you don’t have to repeat the last 20 years. Did you know that a healthy woman, let’s call her Ms Cratchit, with a car who lives  in rural Alabama has a less than 1/100,000 chance of dying in childbirth in 2014  and her baby Tim has a chance of dying of much less than 1/1000. Did you know that  Ms Cratchit  with diabetes and no car, has a personal risk of death about twice that of her non-diabetic self. Tim has about a 1/100 chance of death. This needs to be changed.

“But Governor,” Don says, “about 50% of Alabama counties offer no provision for care delivery for pregnant women. What can we do?”

Don, what we KNOW is that access to contraception and  pregnancy delay until the medical problems are controlled improves outcomes dramatically. What we suspect is that effective transportation is much more important that a poorly prepared health care provider with no ability to provide pregnancy care. What we need to find out is how to leverage technology, realign incentives, or utilize non-licensed providers to improve outcomes further. We need to focus our improvement methods ON A COMMUNITY SCALE to improve measurable outcomes.”

…and it was always said of him, that he knew how to use ObamaCare well, if any governor alive possessed the knowledge.  May that be truly said of us, and all of us!  And so, as Tiny Tim observed, God Bless Us, Every One!

I was reminded in the comments to my last post (found here) that the concept of “insurance” leading to increased risk taking behavior is known as “moral hazard.” To oversimplify, to those who do not want to cut their feet, shoes are form of insurance. That makes them a moral hazard. Wearing them encourages risk behaviors (such as walking where nails might be sticking up out of boards). If  you want to be extra-sure not to cut your feet, go around barefoot all the time, so the argument goes. In this vein, health insurance (pooled resources paid out to the sick for purposes of correcting illness sequelae) leads to ill-advised health behaviors (smoking, drinking, whoring) and should be abolished. This theory was first brought to the public square in 1963 (article here) when health insurance in this country was about 10 years old and there were no NICUs, very few cardiac care units, limited (or no) effective treatments for cancer, and health care quality was pretty much a crap shoot.

The theory was effectively put to bed in 2004. For a lay person’s discussion of the fallacy of the moral hazard argument of as it related to health insurance, there is an essay by Malcolm Gladwell which lays out the concept quite well. Some of the questions we are asked to consider regarding the role of health insurance include:

Do you think that this kind of redistribution of risk is a good idea? Do you think that people whose genes predispose them to depression or cancer, or whose poverty complicates asthma or diabetes, or who get hit by a drunk driver, or who have to keep their mouths closed because their teeth are rotting ought to bear a greater share of the costs of their health care than those of us who are lucky enough to escape such misfortunes?

For the advanced reader, the New Yorker article refers to a body of work by John Nyman, reviewed in an article from Health Affairs (found here). He presents a hypothetical case

For example, consider Elizabeth, who has just been diagnosed with breast cancer.Without insurance, she would purchase only the $20,000 mastectomy required to rid her body of the cancer. If she had purchased an insurance policy for $4,000 that paid off with a $40,000 cashier’s check upon diagnosis of breast cancer, she might purchase the $20,000 mastectomy and also a $20,000 breast reconstruction procedure.

He points out that a moral hazard exists, according to some, because the additional cost to Elizabeth for the reconstruction in the scenario is $0 and the real cost therefor is artificially elevated. In real life, he astutely observes, few would have a mastectomy just to get a “free” new breast and many would make exactly the same decisions regardless of the payment structure. Thus the effect of the moral hazard on care decisions remains unknown but it is likely that the presence of insurance does not effect peoples behaviors as much as other pressures. Nyman goes on to say that providing access to money dedicated to paying for health care leads, oddly enough, to appropriate purchase of health care all other things being equal.

The solution to our health care PAYMENT woes are invariably low co-pays for appropriate care, low premiums so everyone is in the game, and low (even subsidized) prices for the right care. The solution for the DELIVERY side is a well regulated care delivery system to negate the effect of information asymmetry. More on that, later.

I’m back in Mobile from the Alabama Academy of Family Physicians meeting in Sandestin Florida (why an Alabama meeting is in Florida is a story for another day) and I was struck by three separate observations. The first was the participation of students in the meeting. The Alabama Academy Foundation has recently begun sponsoring students at the meeting and this year there were 20 students who had enough of an interest in primary care and Family Medicine to come to the meeting. You might say “So what, how tough can a trip to Sandestin be.”  I can assure you that Dr Coleman made sure these students were at more meetings than beaches. They all seemed engaged and eager to learn about and participate in the delivery of primary care upon graduation. Here’s hoping we get the payment structure improved before the students graduate so they will not be actively discouraged from going into primary care due to income potential.

The second observation was regarding the visit of gubernatorial candidate Robert Bentley. These meetings do not usually take on the tone of a political rally, but because Dr Bentley is a physician I suppose it was felt by the leadership to be okay. Dr Bentley stated that having a physician in the governor’s mansion would help Family Physicians to succeed (because we all have medical school in common). He then outlined his platform of fighting against “certain provisions” of the Patient Protection and Affordability act throughout his governorship. His belief is that we can delay long enough to allow the Obama administration and the Democratic Congress to be replaced, then the entire bill can be repealed. He favors replacing the coverage provision with Health Savings Accounts, tort reform, tax breaks, and the traditional doctor goodwill. It will be this goodwill that physicians draw upon when asked to see an uninsured patient. I would like for Dr Bentley to come and speak to some of the specialists in Mobile who seem to have lost the goodwill aspect of their practice and let’s see if we can create a more collegial atmosphere down here. In particular, I would like to draw his attention to the dermatology situation.

The last observation is regarding the update from the Academy. Every year the national Academy sends a representative to fill in the membership on the ongoing activities and upcoming plans. The update this year included the details of the Patient Protection and Affordability Act. In particular, it included information regarding the Medicare Pilot Programs. The law requires that these programs be developed, evaluated by CMS (not by Congress), and if shown to save money be rapidly replicated. The Accountable Care Organization (2012) and Bundling Payments (2013) are going to be rapidly piloted, evaluated, and replicated. It is clear that this will happen because CMS wants to be out of the business of paying for fee-for-service medicine and sees this as a huge opportunity.

So my advice to the students (and folks already in Family Medicine) is this: The wave of payment reform is going to happen. Primary care in general and Family Medicine specifically is being positioned to be in the driver’s seat of a changed healthcare system. The battle to keep government out of health care delivery was lost 60 years ago. Rather than working to negate the law, I encourage all of us to work to make advanced primary care techniques a part our practice and to work to make our medical neighborhood a place where safe, effective, and efficient medicine takes place. Rather than wait to see if another wave comes along, I would suggest we paddle as hard as we can to get in front of this one.

I am teaching a class tomorrow entitled “Health Care Reform” to the first year medical students. I pulled out my slides from last year (January, had just come back from DC, was convinced that we would have something on the President’s desk by July) and made some changes. The good news was that I only had to add a couple of pieces of information to the talk. The bad news is that we don’t have change yet, but it may be closer than we think.

Why don’t we yet have health care reform? There was an article in the New Yorker  several years back that did a very nice job of describing the concept of moral hazard and why there is a policy dispute about health care as a social good. Gladwell points out that many feel (most fall on the “conservative” end of the spectrum although not all) that the uninsured who pay cash rarely have no health care expenses and  the very wealthy spend a lot on health care. In a market system those paying cash are paying closest to the true  value so it must be that those who are wealthy view health care as a luxury item. It would not be morally right to give all Americans access to this luxury.

The RAND corporation performed an experiment in the 1990s to see whether this would be the case. They found:

In general, the reduction in services induced by cost sharing had no adverse effect on participants’ health. However, there were exceptions. The poorest and sickest 6 percent of the sample at the start of the experiment had better outcomes under the free plan for 4 of the 30 conditions measured. Specifically,

  • Free care improved the control of hypertension. The poorest patients in the free care group who entered the experiment with hypertension saw greater reductions in blood pressure than did their counterparts with cost sharing. The projected effect was about a 10 percent reduction in mortality for those with hypertension.
  • Free care marginally improved vision for the poorest patients.
  • Free care also increased the likelihood among the poorest patients of receiving needed dental care.
  • Serious symptoms were less prevalent for poorer people on the free plan.
  • Cost sharing also had some beneficial effects. Participants in cost sharing plans worried less about their health and had fewer restricted-activity days (including time spent in seeking medical care).

In addition,  the experiment examined whether shouldering more of their own health care costs leads people to take better care of themselves. It did not. Risky behaviors were not affected — rates of smoking and obesity, for instance, did not change.

(An article in this week’s New England Journal of Medicine finds that increased cost sharing on the outpatient side in Medicare patients leads to delayed care and more hospital care as well. People tend to be penny wise and pound foolish when it comes to their health. A lesson learned in the 1930s and one of the reason that a group of physicians founded Blue Cross)

Mr Gladwell points out that the real objection to universal coverage, from a policy standpoint, is that some people (those with disease) will consume more resources than they will have been predicted to pay for. In other words, the objection is that resources are redistributed  from those who are healthy to those who are unhealthy. Susan Channick expanded this in an article on why we will never have a single payer system in this country. She lists the reasons as inertia, path dependence, the expense of the Medicare program, the American belief in looking to the private sector for solutions to even large social problems, the fear of big government coupled with the belief that government is the problem rather than the solution, the political preference for incrementalism over fundamental change, and cultural beliefs such as the belief that while all Americans enjoy equality of opportunity, only those able to capitalize on the opportunity are entitled to enjoy its fruits. This last one is the most profound, as the implication is that we Americans who are healthy deserve to be healthy and owe nothing to our unhealthy neighbors.

In an article in the New England Journal, Thomas Murray points out that the Judeo-Christian tradition as articulated in the Bible includes the concept of “stewardship.”  He says that “Landowners are instructed in Leviticus: “When you reap the harvest of your land, you shall not reap to the very edges of your field, or gather the gleanings of your harvest; you shall leave them for the poor and the alien.” The obligation is not limitless: the landowner does not have to prepare a meal for the “poor and the alien,” does not have to surrender the entire crop, and should protect the land to ensure that it remains productive. But when food is more than sufficient to feed all, allowing some people to starve is indecent and represents a failure to live up to universal moral duties.” Lets all try to live up to that standard.

A very good article in the Atlantic about the economics of healthcare. This reinforces what I have been saying for years, either we need much more regulation or a completely different approach to healthcare delivery. The more I think about it, the more I think an HSA, catastrophic insurance back-up, and vouchers for evidence based preventive care are the way to go. Having said that, don’t know what would happen to those folks with chronic, debilitating illnesses or folks that make poor health choices…

Archives