Tuesday, March 31, 2009

A call for submissions!

This afternoon I attended a very well-done lecture by Richard Clinton, professor emeritus of political science at Oregon State University. He spoke about the need for, and nature of, a steady state economy. I handed out a number of announcements of this blog. There is a lot of talent in Corvallis, Oregon, and I hope that some of those who attended will agree to share their thoughts about the current medical system and what might be done about it.

Interesting articles in today's press:

Treating an Illness Is One Thing. What About a Patient With Many?

Sanders Puts Single-Payer On the Agenda

For Injured Workers, a Costly Legal Swamp

Democrats Target Deals to Delay Generics

Monday, March 30, 2009

Selected on-line articles about medical issues


A lesson on health care from Massachusetts

Sick building syndrome; floods, mold, cancer, and the politics of public health

I would like to offer more reader reflections like those sent in by Bill Frick and John Myers. Please do not hesitate to send comments or more extensive thoughts-----I am not being inundated with mail!

Friday, March 27, 2009

Are medical insurance costs rising faster than wages?

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It is often said that medical insurance costs are increasing faster than wages. This may be a case where it all depends on what we mean by “wages.”

Broadly defined, wages are everything of value provided for a worker by his or her employer. This would include dollars paid to the worker directly, fringe benefits (including medical insurance) where the employer writes the check that pays for them, and accrued rights to future compensation----retirement plans.

When medical insurance costs are increasing rapidly, which has been the case for a number of years, our employer may be increasing the amount paid for our insurance faster than he, she, or often “it” (a corporation) is increasing the amount paid directly to us.

In this case, our medical insurance costs are indeed increasing faster than our wages, but only if we exclude the medical insurance costs from what we consider wages. But the insurance costs are not necessarily increasing faster than our total earnings, since they are a part of those earnings. We are simply getting more of our wages indirectly rather than directly.

Of course if insurance costs rise fast enough, they will outstrip the increase in total compensation an employer may be willing and able to pay. In that event, the employer would either need to decrease the actual amount of cash paid to workers in order to make up the difference, lay off some workers (because they have gotten too expensive), or cut down on the insurance benefits purchased.

The bottom line here is that we need to be very cautious in drawing conclusions from reports that medical insurance costs are rising faster than wages.

Thursday, March 26, 2009

Box Doctor: A primary care doctor in every home?

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I am nearly done reading John Geyman, MD, Do Not Resuscitate. He does an outstanding job of pointing out all the problems with the present medical insurance system. However his argument that a single-payer system would be better at holding down costs, while it may be correct, is less convincing.

One of Dr. Geyman’s complaints, shared with many other critics of the current system, is that we have far too few primary care doctors. I have long wondered if one way around this problem might be a kind of “doctor in a box,” software that we could buy (in a box!) and load into our computers.

The Box Doctor would be an expert system that we could run when we think something might be wrong with our health. It would ask us a series of questions and on the basis of our answers might do several possible things: It might tell us to eat a bowl of chicken soup, go to bed, and see how we feel in the morning. It might write a prescription for an appropriate medicine and print it out or e-mail it to our selected local pharmacy. It might tell us that we should go to an emergency room or immediate care center right away and print out its tentative conclusions for us to hand to the receptionist there. It might suggest that we consult our primary care doctor or an appropriate specialist. It might prescribe physical therapy and print out an order to that effect. It might tell us to have certain lab tests done.

A later version might even have a set of gadgets that plug into our computer’s USB port and report certain measurements for the Box Doctor to take into account----perhaps blood pressure, blood sugar, urine tests, pulse, and so forth.

In a word, the Box Doctor would serve as a pre-primary care doctor, and in some cases as a primary care doctor. It could save immense amounts of money and of time and travel, of missed work. It could allow prompt attention to a problem when we might otherwise procrastinate about doing something about it because of the inconvenience of scheduling and going for a doctor visit.

Designing such an expert system would be an interesting challenge for a team of physicians and software engineers. A larger problem, however, might be insuring the software against malpractice lawsuits! Any company seeking to create and market a Box Doctor will need to have a very good legal department as well as top notch doctors and engineers.

It sounds like a job for Google!

Wednesday, March 25, 2009

Single-payer article picked up by Oregonian on-line

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Yesterday the article with which I kicked off this blog was picked up by the on-line version of the Portland Oregonian. To see this version published under a slightly different title, click here.

This will also get you to the comments sent in by Oregonian readers, which were up to 36 as I was writing this. A few of the comments offer useful perspectives in favor of or against a single-payer system, but many of them are stereotyped attacks on the concept or on the presumed dubious motives of anybody willing to think about such a system. There is no basis for thinking that any of the commentators have any personal experience in the medical system, have spent much time seriously thinking about it, or have any ability to think systematically about public policy issues. Furthermore, they are mostly so certain that they, and they alone, are correct!

I much prefer comments from people like John Myers and Bill Frick, whose thoughts I have posted here, who have interesting personal experiences with medicine and who frankly admit they don’t know what ought to be done but would like to help figure it out.

The kinds of comments that are sent in to newspapers like the Oregonian and the New York Times are exactly why I have chosen not to allow readers of this blog (who I hope will be more knowledgeable and thoughtful than most people who comment at the newspapers) to post comments directly to this blog. If too many comments like I read in the Oregonian appeared here, it would discourage the kinds of people I want to encourage to participate from reading postings and sending in their thoughts. In a kind of Gresham’s Law, the bad money (even from a small minority of readers) would drive out the good!

And even if they were all of high quality, if there were too many postings few of my targeted readers (who are busy and have a lot of other things to do!) would find time to read the blog. After all, sometimes there are more that 600 comments posted for a single article at the New York Times before the editors cut off further postings!

The economist Thomas Sowell says that the fact that he has never murdered an editor is proof that capital punishment really does deter. I, too, have often had unkind thoughts about editors. But I am functioning here as an editor, seeking to protect my readers from nonsense (unless it is truly interesting and original nonsense!) and also from being inundated even with too much good stuff for them to manage.

Let me hasten to add that I do not define as "nonsense" ideas with which I do not agree. So do not hesitate to send in criticisms of anything which I may have said.

Tuesday, March 24, 2009

The science of denying claims

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John Geyman, M.D., whose Do Not Resuscitate I am continuing to read, argues that the private medical insurance companies have made a science out of denying claims. It seems to me that he makes quite a case, though one does not necessarily have to accept his interpretation of this practice---that it is designed to maximize profits (which it no doubt is) and that government as a single-payer would not be tempted to engage in similar behavior.

When I turned 65 I enrolled in a Medicare Advantage Plan offered by Healthnet. In general I have been satisfied with this insurance. However one problem I have had with them could furnish strong ammunition for Dr. Geyman.

Healthnet includes a limited dental benefit (which pure Medicare does not), covering two cleanings and dental exams and one set of x-rays a year. The value of this coverage has proved minimal for two reasons:

First, the amount they will pay for the dental inspections and x-rays is substantially less than the actual charge, and since my dentist is not under contract with Healthnet I have to pay the entire difference.

Second, and more seriously (since I could avoid the first problem by switching to one of their approved dentists), Healthnet will not pay anything for my twice-a-year cleanings. My dentist thinks I need a more intensive cleaning which is coded as periodontal maintenance. Healthnet tells me that such cleanings are not covered.

Interestingly, when I first signed on to Healthnet several years ago, they would “re-code” this periodontal claim to a regular one and pay what they would have paid if I had gotten such a cleaning. This seemed extremely reasonable to me. But then they stopped recoding and refused to pay anything for my cleanings. When I pointed out their previous practice they claimed that the American Dental Association had decided in 2005 that “down-coding” was fraudulent and that they therefore could no longer do it.

It would obviously be fraudulent for my dentist to down-code what his office did, and his office quite properly said they couldn't do that when I asked about it. But I fail to see how it would be fraudulent for an insurance company to pay what it would have paid for a less extensive cleaning, and I suspect that Healthnet seized on the ADA decision (which probably had some other problem in mind) as an excuse to save some money.

It is too bad, since otherwise my experience with Healthnet has been good, but the dentistry issue has left a bad taste in my mouth.

Monday, March 23, 2009

How much of the GDP should go to medical care?

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I have just started reading a book I got from Mike Huntington, MD (a retired radiation oncologist) at church Sunday: Do not resuscitate: Why the health insurance industry is dying, and how we must replace it. The author is John Geyman, M.D. It has started out with an excellent summary of the history of medical care insurance in the United States, a history which helps to understand the dilemmas we are presently face.

A graph inside the front cover shows extrapolations of average household income and of average family health insurance premiums, and suggests that these two numbers will meet along about 2025. This, of course, is impossible, so if the two extrapolations are correct something is going to hit the fan well before 2025. The graph expresses a point which we all understand intuitively, though perhaps we cannot take the specific numbers in it literally.

It is well understood that medical care has been looming larger and larger in our national life. It now accounts for about one sixth of the gross domestic product. While it clearly would be impossible for health care expenses to rise to 100% of GDP, it is not so clear that there is anything inherently wrong for the percentage of the average person’s income devoted to medical care to be increasing.

At the turn of the 20th century the average person had to spend a very high percentage of his or her income on food. Now for most people food is a much smaller part of their expenses (unless they eat out a lot). In 1901 the percentage of personal income spent on radios and television sets was much lower than it is now, 0%, in fact, because there was no radio or television then. As technology changes, some things cost a lot less (computers, for example, in recent years) and some things cost a lot more----medicines and the services of doctors, for example. There is no way a priori to state what the correct percentage of expenditures would be for any of these things.

As medical technology and techniques and skills have improved, it is not strange that we have come to value them more and to be willing to pay more for them.

The situation is confused, though, because such a high percentage of today’s medical costs are paid for by “third parties,” insurance companies and/or the government (that is to say, taxpayers), and the decisions about how much medical care to pursue are often made by individuals for whom there will be few if any immediate out-of-pocket costs and therefore no incentive to seek the most cost-effective treatment.

The interesting question is how much of the increased costs of medical care are due to the third party factor, and how much to the fact that we place a higher value on medical care because it is now more effective and therefore worth more.

Saturday, March 21, 2009

Thoughtful tale of woes with current insurance system

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Bill Frick writes from New York City:

My first experience with the dark side of our health insurance system was back in the sixties when I was diagnosed with Crohn's disease. I subsequently had three surgeries. At the time I was on a quarterly payment system with my insurance company. They had always sent me premium notices for several years. Then after my second surgery, they did not send a premium notice and I forgot to pay the premium. They reinstated my policy, but with an exclusion for Crohn's disease.

Since this disease is chronic and characterized by many exacerbations and sometimes incredibly high costs, I found myself in a difficult situation. The company soon stopped sending premium notices altogether. I kept my insurance in force by sending them registered letters when the payments were due.

Fortunately I found a job that had an excellent group policy that has covered me ever since, including my retirement years. Maintaining health insurance was an important motivation for staying in this job until I could retire with insurance.

What I learned from this experience is that unlike most businesses in the capitalist system, insurance makes money by not providing services to people. The more people who buy insurance they don't utilize, the more money the company makes. Likewise, if the insurance industry can screen out high risk cases [i.e. people who really need it] they can also make more money. I think experience shows that one can not depend on the good will of the insurance industry to regulate themselves, any more than one can expect the financial industry to do so. Some controls are needed to assure everyone can buy insurance.

I think that fear is a complicating factor in thinking about health insurance. Those of us who have it are afraid that any change will make our lives more difficult. We are afraid that bureaucracy will keep us from getting what we need. For myself, I need more information about how a single payer program would work. How would it affect my current insurance arrangements.? Would I have to pay more taxes?

It may be helpful to listen to concrete stories of those who are not in the system or who are struggling with it. Facing a chronic disease and death are terrible enough. With bankruptcy and financial ruin, fear can become even more pervasive and further destroy the capacity for coping and healing. Siituations like this can demoralize not only patients, but their families. I know many people who barely have enough money to pay the rent and meet living expenses. The high cost of health insurance makes buying insurance almost impossible. One person I know, had to go to the emergency room with severe abdominal pain. She was than saddled with a bill that she may never be able to pay off. Another aquaintance lost his job due to severe illness. He also lost his family health policy. While he may eventually become eligible for government help, the cost of purchasing a policy for his family is made more difficult, if not impossible, by his reduced income from his loss of salary. There are millions of Americans in similar situations. I think we need to keep listening to their stories and keep asking ourselves if our current situation is the best we can do and what attitudes we have that prevent us from finding a more humane response to the suffering and fear of those who live outside our current system.

An outstanding TV Program on this issue is Now On PBS for 03/20/09. The url for this show is http://www.pbs.org/now/shows/512/index.html

I know this is a complex issue and I am not certain what resolution is best. But if we can let go of ideology, deal with our fears and listen to our own real needs and the needs of others, we may move toward some answers.

Friday, March 20, 2009

Should medical reforms be comprehensive or incremental?

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A fundamental problem for medical reformers is to decide whether needed changes should be introduced as a package deal, one major piece of legislation, or by means of a series of smaller changes, taking one step at a time.

In organization theory this issue is stated in terms of “comprehensive rationality” versus “incrementalism” (or, more graphically, “muddling through.”)

There are both advantages and disadvantages to both of these approaches to major reforms, and proponents of major medical system reforms need to be aware of them. A single major package offers the possibility of a certain neatness and elegance and appears to allow designing a medical system that makes sense when seen as a whole. It also offers the prospect of getting the job done much faster than a series of incremental changes would allow.

A series of incremental changes, on the other hand, allows for a more experimental approach,. It is easier to back out of smaller changes if they do not work as expected. In a country like the U.S., some changes can be tried at the state level and then imitated at the national level if they work out well----the “laboratory of federalism” idea.

A major problem with reforming in a single big step is that it is very hard, perhaps impossible, to predict the consequences when we make a major change in a highly complex social system. And there is no doubt that the American medical care system, accounting for about one sixth of the total economy, is extremely complex.

A series of small changes, on the other hand, may take too long and may move the overall situation into a blind alley from which it is difficult to escape. And they can produce such a complex medical system, even more so than today’s, that the average person cannot figure out how to use it.

It is politically difficult to achieve major changes because perspectives on all proposals will differ greatly, and opponents of any particular change can always argue plausibly that it will not work and will produce disastrous consequences. And all of the vested interests that will be harmed by the change can join together and form a powerful bloc against it. Smaller changes, which will injure fewer vested interests, may therefore be more politically feasible.

In the former Soviet empire, a similar argument took place between advocates of “shock therapy,” (who argued that you cannot step across the Grand Canyon in two or more steps), and those who wanted to move to a private-enterprise economy more gradually. Just which approach worked better in those countries is hard to say.

In actual practice, these two approaches to change are often combined, and that is what I expect will happen as we seek improvements in the American medical care system.

Thursday, March 19, 2009

Inflation does not explain all medical cost increases

I have been reading back issues of the local newspaper that piled up during my March 2-13 trip by Amtrak to Boston.

A letter to the editor proposed revaluing the dollar (and all prices). The writer saw this as a cure for the increase in cost of a doctor visit from $36 in 1982 to $248 in 2008. She apparently believes that all of the increase in the cost of visiting a doctor was due to inflation.

(The doctor referred to must be a specialist, or maybe a dentist. My doctors don't charge this much for a regular visit!)

There are several problems with this analysis. First, if all prices (including wages) were changed, a doctor's fee would still be the same percentage of one's income. Second, inflation since 1982 does not account for an increase from $36 to $248. According to the
inflation calculator at the Federal Reserve Bank, $36 in 1982 is the equivalent of $80.28 in 2008, not $248. So most of the price increase is not explained by inflation.

Wednesday, March 18, 2009

The increasing costs of medical care

Last night I attended a forum on legislative proposals for state health care reform in Oregon. The meeting room at the Corvallis-Benton County Public Library was filled. An informative presentation on current legislative activities was presented by a panel. Dr Cliff Hall, who presided over the meeting, noted that the cost problems in today’s medical system are rooted in three factors:

1. Imbalance between primary care doctors and specialists. He noted that only one third of American doctors deliver primary care while two thirds are specialists, and suggested that it would be better if these proportions were reversed.

2. Development of expensive new technologies.

3. The escalation of extreme and perhaps dubious medical treatments at the end of life, so that a significant portion of lifetime medical expenses come in the last few months.

There were a number of very thoughtful questions and comments from the audience and we all went away with much to think about.

Regarding Dr. Hall’s second point, I have long wondered if governmental funds should not be tilted more towards research aimed at making existing treatments and technologies less expensive rather than towards the development of new treatments and technologies.

Tuesday, March 17, 2009

John T. Myers, PE, writes:

One continuing problem with ALL means of sharing risk re health costs, via insurance or government action, is the reality of rationing. Government systems of health care are frequently tagged with the stigma of "rationing" care, which they DO do. There is only so much medical care available, so any systemic approach should recognize that prioritizing the $$ and medical man-hours available will happen. One solution to the stigma is openness, which too many government programs avoid.

Example: The current VA treatment system promises care for ALL eligible veterans. In reality, the total care allowed ( by the $$ allocated to the system ) is way short of demand, particularly in psychological help. The VA effectively "Rations" health care by having several un-acknowledged barriers. Their facilities are sited physically in places remote from the largest populations of veterans in need. Their admittance criteria are time consuming & records intensive, with minimal assistance for the needy vet. While the VA itself publicly claims to want to treat vets, the vets who need treatment see a huge maze, which effectively blocks & delays their access to the treatment they need. THIS is the system I expect to find when there is only one source for all health care.

While the current Insurance system does have costs, which I would like to think can be reduced, it does have ONE singular advantage: the public has the government on IT's side in disputes with the insurance industry. With a single-payer ( Government ) system, it is ME, alone, against the entire government when I need access to the system. There will be no independent forum to argue my needs in. If you think I am wrong. the OTHER example of government managed care is Medicare. Try getting a change to their rules for care-givers!!

ANY new system of cost allocation needs to start by understanding and discussing the rationing which WILL occur. The new system must have some explicit PUBLIC forum for continuous review of both individual cases, and systemic reforms. This system MUST be quick to review & decide: Medical care delivered late is NOT caring! British medicine has long depended on delaying expensive treatments to decrease their total costs: their incidence of Heart bypass operations & Kidney transplants is tiny compared to ours, and most of their candidates die waiting!

I spent my childhood & 7 years after college in the active military medical care system. I am now stuck in Medicare for the rest of my life. Both systems can do a good job, with the right assets. Both can be totally non-functional in individual cases. I worked for 30 years in the employer paid insurance system, which has it's own negatives: Lock-in or non-insure-ablity being one major issue.

None of those systems is what I want for my grandchildren ( when they arrive).

Sunday, March 15, 2009

Why conservatives should not rule out a single-payer system

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It appears to be an article of faith among conservatives that a single-payer medical insurance system (“national health insurance”) is a terrible idea. Often, the “socialized medicine” label is stamped on it and it is rejected out of hand. More thoughtful conservatives will recite a long list of disadvantages, some of which are real, and rest their case.

The problem with these thoughtful conservatives is that all public policies have both advantages and disadvantages. The disadvantages and costs of a proposed policy do not necessarily mean it is a bad idea. (The converse is also true: the mere fact that a policy has advantages and benefits does not prove it is a good idea.)

Serious medical policy discussion requires us to consider both the advantages and the disadvantages of each of the many possible policies. We must seek the policy producing the most benefits with the fewest downsides and costs. Simplistic analyses which assume that some proposals are all benefits and no costs or all costs and no benefits must be avoided.

Conservatives bring many useful perspectives to the table. It would be a shame if they allow their preconceptions to prevent them from contributing actively to the forthcoming national discussion.

Conservatives, for example, have long been critical of “unfunded mandates,” under which the national government imposes duties upon state or local governments but does not provide the funding needed to carry out these duties. This in effect increases national taxes, but in a way that gives Congress the credit for the benefits while state or local governments incur the blame for increased taxes. However one of the alternatives to a single-payer medical insurance system funded through federal taxes is an unfunded mandate: imposing a duty on individuals to purchase medical insurance. In effect, such a mandate is still an increase in federal taxes.

The “anti-tax” argument against single-payer is therefore invalid since many other systems would also increase taxes, one way or another. And a tax increase for single-payer would be offset by elimination of insurance premiums paid by individuals, either directly or as the reduced wages occasioned by premiums remitted by their employers.

A second example: Many conservatives favor decreasing governmental complexity in order to render it more understandable and thus controllable by the electorate. But any medical insurance policy short of single-payer will probably increase governmental complexity and impose an impossible range of choices on individuals who will be forced to decide what insurance to buy without having the information needed to decide intelligently.

Conservatives also value efficiency. This should make them suspicious of the present insurance system under which large amounts of money are spent by insurance companies trying to avoid paying for particular treatments for particular patients. A certain amount of such “transaction costs” would be necessary even under single-payer, since automatically paying for all conceivable treatments for all patients would bankrupt any system. But experience with Medicare indicates such costs would be much lower than is the case with private insurance.

Conservatives should remember that a single-payer system will not automatically bring with it a governmental monopoly on the provision of medical services. Some of the problems associated with single-payer systems in other countries result from governmental monopolies in providing treatment rather than from the fact that government is the single payer.

None of this is to say the case for single-payer is clear and obvious, but it does suggest that conservatives would be very unwise to rule it out without a lot more thought and conversation.

Sunday, March 8, 2009

The purpose of this blog

I am starting this blog to promote conversation among informed professionals in medicine and public policy as well as other people with a serious interest in reforming the American medical care system. As of 2009 medical care accounts for about one sixth of the American economy, a figure which has been constantly increasing for many years. The increasing dissatisfaction with the current arrangements suggests that something needs to be done, but there is obviously little agreement about just what this should be. I hope our discussions will help to make the decisions which are going to be made at the national level in the next few years to be good ones.