The Health Care Blame Game

The Health Care Blame Game


Nortin HadlerOvertreated, overstaffed, over-administered, overpriced, over-regulated, and over-legislated: that’s for starters. How about over-diagnosed, over-medicalized, over-screened, over-digitized, and over-litigated? Then there’s unavailable, inaccessible, non-empathic, and even cruel when it comes to the disabled, disallowed the disaffected and the disavowed. To top it off there’s the American fashion of dying, alone and encumbered by the machinery of futility.

Political pundits and policy wonks point fingers at the mainstream American health care system, sometime more than one finger, often at more than one putative culprit, and often by partisans within the system. It’s open season.

Then there’s the off-off-campus American health care system decrying the on-campus system as insufficiently holistic, alternative, complementary, organic, nutritious, mindful, centered, and soothing. Worse, still, the mainstream is decried for being dismissive of the various therapeutic modalities that various practitioners believe to be essential to maintaining health and restoring well-being. The on-campus Health Care System is so dismissive of these “others” as to wield the “sectarian” label and to restrain their licensure as much as political pressures countenance.

The American people and their elected representatives are left on the side-lines to ponder this cacophony. In addition to the deafening din of the finger pointing, Americans are buffeted by anecdotes from their neighbors; some are true believers and others sling reproach consequent to negative experiences. The national cognitive dissonance is further inflamed by all sorts of agencies bearing gifts and promises or castigating others. No day can dawn without the mustering of campaigns in direct to consumer marketing and the marshaling of pronouncements from all the Elmer Gantry’s and sages employed by the media.

How can this be in an era when health and disease have emerged from the miasma of presupposition into scientific enlightenment? We apply finely honed critical razors to every aspect of health care from its administration to clinical interventions. We assume we hold the welfare of the patient as inviolate. Is that cognitive distortion, a national self-deception? Are we fooled, yet again.

R.V. Pierce MD said,

During the last half century a great change has taken place in the treatment of disease. Medicine has advanced with rapid strides, from the narrow limits of mere empiricism, to the broader realm of rationalism, until today it comprehends all the elements of an art and a science. Scientific researches and investigations have added many valuable truths to the general fund of medical learning….

Pierce (1840-1914) said this in his self-published book “The People’s Common Sense Medical Adviser in Plain English: or, Medicine Simplified.” I have the 47th edition in my collection. It was published in 1895 after earlier editions had sold 1,370,000 volumes according to Pierce. Pierce received his M.D. from the Cincinnati School of Eclectic Medicine and fancied himself competent to practice by eclectic, allopathic and homeopathic principals as well as “the liberal and independent physician.” He was master at putting your money where his mouth was, one of the giants in an era of predatory marketing of remedies. He owned a factory in Buffalo to manufacture “Dr. Pierce’s Golden Medical Discovery”, “Dr. Sages’ Catarrh Remedy” and many other potions. His book was essentially a catalogue of remedies interspersed with pages of glowing testimonials from satisfied patients.

There was little to stop Pierce and other unabashedly entrepreneurial charlatans of that age. The Pure Food and Drug Act passed in 1906 mainly to protect the public from poisonous preparations. We waited till 1938 for the Food Drug and Cosmetic Act which created the FDA and charged it with assuring some modicum of safety for prescription drugs. The Kefauver-Harris Amendments of 1962 further charged the FDA with assuring a reasonable benefit-to-risk ratio before licensing pharmaceuticals. One might think that in the 21st C the “science” wielded by the FDA would have banished entrepreneurial charlatans at least from the pharmaceutical industry. But all this has done is to transform identifying entrepreneurial charlatans into an exercise in hermeneutics.

Valuation v. Valuing

Valuation is a term used in finance that intrudes into the health care system under the rubric, “the health care dollar.” It is assumed that the health care dollar has something to do with health.  However, establishing a price is not the same as valuing the degree to which options are salutary. Valuing putatively salutary options in the din of the American “health care” marketplace is a shell game. One often loses even when one follows the pea. When the clinical outcome is untoward the conclusion is more likely that the magnitude of illness was responsible rather than the degree to which the intervention was inadequate. That is true at the institutional level, not just the bedside. But cognitive distortions at either level are synergistic; we can’t delude ourselves in one arena without similarly affecting the other.

Helping a patient value options is a challenging exercise for which amateurs, dilettantes, and novitiates are often a match. That’s why I find the arguments for the “Doogie Howser” 3-year medical curriculum as ludicrous as the argument that one need not empower any patient who’s over age 75 to consider options to promote further longevity. I will argue that the only inviolate role for the modern physician is to provide a trustworthy sounding board for the valuing of options1, but I’m getting ahead of myself.

Rare is the person who chooses to be a patient for the fun of it; all have angst, all have tried to cope, all have attempted the differential diagnosis of their predicament, and all have considered options for recourse. If the choice is to be a patient of a physician, it is because the person believes the physician to be a safe port in a highly personal storm. To provide a safe port requires propensity and ability to comprehend the idioms that color the narrative of illness. There is no other way to understand the illness the patient is experiencing. And that is prerequisite to discussing options in an empathic dialogue that defines the limits of diagnostic and therapeutic certainty with only the welfare of the patient as motivation. Medicine is a highly responsible ministry that demands perspective, knowledge and, crucially, wisdom2. Acquiring such is a life-long exercise in learning at the bedside and at the proverbial curbside. Medical school should not be abbreviated; it should never end.

Clinical science is most compelling when it rejects possibilities, even appealing diagnostic or therapeutic possibilities. Short of that, all possibilities remain tenable. It is the wise physician that can help the patient deal with uncertainties3. It is in the context of the trustworthy doctor-patient dialogue that uncertainties become illuminating rather than daunting. The entire exercise relies on the notion of “trustworthy.”  The relationship must divorce from the narcissistic, argumentative, conflictive, and finger-pointing health marketplace. That means the physician must have no external conflictual relationships4 and a keen awareness of those conflicts of interest that are internalized, that relate to presuppositions and beliefs that are part of the human condition. The flip side of trustworthiness is the demand for comprehensiveness in the physician’s knowledge base, a composite of personal intellectual resources, peer discussions and recourse to the considerations of others. There are no short-cuts to helping a patient understand and value clinical options. There are guideposts. Here are 4 close to my heart:

Guideposts for the Epistemologically Challenged

Recognizing the too little and the too few:

There is a trend for American medical students to acquire another degree. More and more, they think an MBA is useful, although I can discern no clinical utility. To the contrary, this is preparation for attending to the needs of the “system” rather the needs of the patient. One would presume that the MPH would have clinical utility but I am finding it progressively distancing from the demands of the doctor-patient relationship. The course of study leading to the MPH is increasingly dominated by almost religious faith in stochastic metrics. Medical students, physicians in training and young practitioners wield p-values, risk assessments, and the results of meta-analyses as if these all come down from Mount Sinai in stone. If a clinical effect, deduced in a systematic study, is unlikely to happen by chance more than occasionally, it rapidly achieves licensure and becomes a standard of care even if the clinical effect is small in magnitude or rare in frequency. Furthermore, even if the small effect proves difficult to replicate, it has staying power; statistical maneuvers make a mountain out mole hills of data resulting in “According to the meta-analysis (du jour), ….”

I have long called all this “small effectology”; the clinical valuation of much ado about too little to be assumed to be a clinically meaningful option. There are many reasons that small effects in trials are irreproducible, reasons that range from individual differences between subjects to data torturing. But the reasons are not as important as the magnitude and frequency of the health effect in the first place. When the effect is small, such as from anticoagulating patients with non-valvular atrial fibrillation 5, the doctor-patient dialogue needs to define its value to a particular patient. When the effect is fatuous, such as with interventional cardiology for coronary artery disease 6,7, the dialogue has to confront preconceived notions and common sense.

The doctor-patient dialogue is not an assault on overtreatment and overdiagnosis; this is simply sound ethical clinical practice. Physicians are capable of doing this one patient at a time. Anyone can prescribe an anti-coagulant and many can learn the hand-eye skills to place a stent. But it requires a great deal of knowledge and maturity to help a patient value either option. Guidelines are no substitute8. I recall a 52 year old perfectly well man with a normal PSA who elected for prostatectomy because his brother and father died of prostate cancer at that age and anticipatory anxiety was dominating his life. This was an irrational decision on stochastic grounds, but this was a well-informed but frightened man who, despite trying, found no other pathway to relief. I know of women plagued by repeatedly “suspicious” mammograms and negative biopsies reasoning for mastectomies.

Recognizing when rational is not sensible, and sensible is not judicious:

One might well ask, is it rational to pursue small effects in the first place? The answer depends on who you ask. For PHrMA, healthcare institutions, or health insurance companies there is no equivocating. Small effects are their bread-and-butter. They anchor the ploys of pharmaceutical marketing, the “through put” of large hospitals and clinics, and the profit margins of health insurers who are still basically cost-plus providers for their large clients.

The pursuit of small effects is also a rational behavior from the perspective of treating doctors. It can be argued that there is no other option given the constraints of the American health care system. For those practicing the “cognitive specialties”, they quickly learn that it takes 20 seconds to write a prescription (infuriatingly longer in the EHR) but at least 20 minutes not to write that prescription. The former seems natural to the doctor and the patient. Not only is the prescribing quicker, it is often rewarded in “quality” measures, through-put, and by the ever-shifting “meaningful usage” requirements perpetrated by Federal regulations. Furthermore, even if one takes the 20 minutes to explain the marginal indications for the prescription, not handing a patient a prescribed reward for seeing the doctor can seem counterintuitive to the patient. Between marketing and the common sense, all Americans know their numbers and are hell bent to pummel them to normal. Anything else engenders fearfulness and accusations of non-compliance.

The pursuit of small effects as a rational exercise is even more predictable when it comes to elective surgery. It’s hard for any patient to imagine that a surgeon would perform surgery for no good reason. And surgeons must perform surgery to support their office overhead let alone their lifestyle. I was invited to deliver a keynote to the National Orthopedic Leadership Conference on the topic of the future of fee-for-service medicine. I said the only justification is if the surgeon can convince Americans that they are as valuable for telling a patient they did not need knee surgery as for operating. That’s a difficult sell to surgeons or health economists who are convinced that technical prowess is invaluable even if we can’t show that the patient is benefited. From the perspective of the minions of stakeholders and many/most treating physicians and surgeons, the pursuit of small effects is not an exercise in overtreatment or overdiagnosis; it is a highly rational undertaking and needs to be discussed with the patient from that perspective.

But is it sensible for the patient to pursue small effects? This is not a matter for pronouncements. This is the question that is the purview of the patient-doctor dialogue. Most Americans are burdened with a lottery mentality9. In all trials of medical interventions, there are “outliers”, individuals who do exceptionally well while the majority derives smaller effects at best. It is almost un-American to turn away from the chance of being the outlier, a mindset that leads to millions purchasing lottery tickets. But that’s the importance of a randomized controlled trial; you have the chance of being an outlier if you don’t agree to the intervention. It’s often nearly as great as with the intervention, as if you can win the lottery without buying the ticket! That understanding places the doctor-patient dialogue on a level playing field instead of a ski slope. It’s on a level playing ground that a patient can begin to confront small effectology.

And finally, one might ask is it judicious to pursue small effects? A great deal of wealth is transferred to stakeholders in pursuit of the small effect. Very few, if any, patients are advantaged to a clinically meaningful degree rendering the price per advantaged patient astronomical. I’d like to see this “pig in a poke” rendered transparent so that the people can voice an opinion as to whether their money is well spent in premiums that insure others for “benefits” that are both marginal and elusive. I know how I’d vote.

Recognizing that which might advantage the person, but not the people:

John McDougal is a California internist who is convinced that plant-based nutrition is prerequisite to healthfulness. He has developed a “Plan”, a product line, a residential program, and a considerable following. Several years ago, he invited me to lecture in his Advanced Study Weekend. I found myself before a sizable audience of vegans, and realized I was streamed to many, many more. Since I had published extensively on the tenuous nature of the science supporting the benefits of any specific dietary regimen, I avoided confrontational arguments and stuck to corollary issues in epidemiology. Nonetheless, the atmosphere turned tense and the room still when, after one of my talks, a member of the audience stood and defiantly asked, “Doctor Hadler, what do you really think of us?” He was earnest and I was not dismissive. I said, “There’s a difference between the health of the person and the health of the people. If you are appropriately supplementing your vegan diet and feel well, I have no qualms. But there is no reason to advocate the vegan diet for the public at large.”

The non-medical menu promising health and offering relief for various symptoms is enormous and has been for millennia. There are people willing to poke you, feed you, purge you and gird your loins – and there always have been. These practitioners of their healing art are convinced they have much to offer of value. Furthermore, there is a segment of the population for whom the promises of such modalities resonate both intellectually and emotionally. The fact that the benefit they experience is not specific to any particular treatment modality but to the treatment act will not dissuade most who are convinced. Furthermore, the more uncomfortable the modality, the more it is costly, and the more alternative, the more convinced the participant that the benefit is worthy of pursuit. Thus speaks the modern science of the placebo effect. Yet it is draped in controversy and a cause of much finger-pointing. The way to end the finger-pointing, and worse, is to reframe the topic.

I titled one of the chapters in Stabbed in the Back “My name is Nortin, and I’m a placebo.” I went on to discuss the notion of “bedside manner.” In Citizen Patient, I discussed a debate I’ve had with some leading bioethicists regarding the placebo. They point out that placebos can alleviate symptoms in as many as 30% of sufferers who are so inclined. The FDA has licensed pharmaceuticals for symptomatic relief that are far less efficacious, which I and other physicians have no compunction prescribing. Therefore, my very astute colleagues argue, placebos should be covered by health insurance and also prescribed. There are few cogent counter-arguments and none on scientific grounds. However, there are several on cultural grounds. For example, if we are to prescribe treatment modalities that have no specific health effect, shouldn’t we also prescribe religion?

I feel strongly that the time to end the placebo finger-pointing is long past. My statement to the public and to my patients is the statement I offered the defiant vegan. If it floats your boat and is harmless, go for it. But don’t ask me to share the cost in my insurance premiums.

Recognizing the follies of peer review:

Who can forget the collapse of Lehman Brothers, the stock market crash and the recession that greeted the early months of the Obama recession? We learned that much of the financial fragility could be ascribed to poorly designed and leveraged investments leading to the bursting of the real estate bubble. Furthermore, we learned that the poorly designed investment instruments were bundles of under- and unsecured mortgages. The bundling was a source of a great deal of wealth for the financial wizards doing the bundling. And the financial wizards were largely young men, some women, most newly minted MBAs often from elite schools who were attracted to the munificence, luminescence and luminaries of Wall Street. They were skillful and paid handsomely for their work, more than handsomely, even obscenely. These young lions would find themselves at lunch bragging that “My bundle is bigger than your bundle.” They applauded, envied, strutted. Never did they question whether they were doing right in doing so well. Had they, they would not be invited to lunch.

This is not malfeasance; this is foibles. It happens in kindergarten when a group decides to pick on someone, or chooses the person to be popular. The group has a like mind. When the outcome is considered laudable, the group is considered admirable. However, the same mindset can operate to do a great deal of harm as in the Lord of the Flies, or on Wall Street in 2009.

Science and scientist are not spared from this dialectic. I could easily argue that interventional cardiologists, spine/knee/shoulder surgeons, oncologists, and many other clinical ecosystems harbor a great number of bundlers. Beyond congratulating each other, they provide peer review when one of their numbers submits a paper to a journal or a meeting, they are the “thought leaders” who parade for PHrMA and device manufacturers, they are the experts on the FDA’s advisory panels, and they write the “Guidelines” that are distributed by the mother churches of their clinical specialties. They wear the same rose colored glasses.

It’s hard to give up bundling, even for those who bother to analyze the data themselves. For example, Harlan Krumholz is an influential cardiologist and epidemiologist who is also Director of the Robert Wood Johnson Clinical Scholars program at Yale. Krumholz was the senior author on a paper recently published in Lancet10. This paper takes advantage of a national administrative data set that offers quantification of the time between arriving at the emergency room with a particular acute heart attack (STEMI) and undergoing angioplasty. An earlier analysis of the “door-to-balloon” time in this data set could discern no benefit from the trend to shorter and shorter delay6. The Lancet paper chose a different analytic framework which purports to demonstrate benefit. The Lancet paper is a form of secondary analysis; returning to the data set in the hopes of finding the answer you presuppose. When it’s a large data set, and you return often enough, you are likely to succeed; that’s called data torturing. The authors argue that the nuances in methodology in the Lancet paper justify their secondary analysis. From their perspective, angioplasty is rational in the setting of a STEMI if done promptly enough. From my perspective, even if I forgive the contrived nature of their analysis, the most they can massage out of this data set is a very small effect: If the hospital personnel reduce the door-to-balloon time from 90 minutes to 60 minutes, in-hospital mortality decreases from 5.3 to 4.7%. From my personal perspective, this is too small an effect to be reliable, let alone valid. If I suffer a STEMI I’d rather be dead without a stent than dead with one.


I have discussed the basis for this judgment with several patients in the course of our relationship. However, no patient, or an accompanying loved one, can make an objective decision while suffering crushing chest pain and surrounded by a “STEMI Team” primed to get you to the balloon on time. Sensible is no match for pain, fear, and unwarranted fear-mongering. This is a why I spoke of judicious decisions. As individuals, are we comfortable underwriting this intervention for others? As a nation, is this where we want to transfer some 10% of the “health care dollar”?


Jacob’s Ladder


There are other guideposts I could offer. However, confronting just these 4 is an insurmountable challenge given the perversities of the American health care system. All the finger-pointing is missing the forest for the trees. Furthermore, all the tweaking of the system in recent years has the unintended consequence of rendering it ever more perverse. Even if we were to change the administrative structure dramatically, as is called for under such rubrics as “single-payer” or national health insurance, we’d be looking at the same trees from a different angle.

Likewise, the aspersions that introduce this essay generally fall on deaf ears. What is overtreatment, overpricing, overdiagnosis, and the like from one perspective is perfectly rational behavior from another. The finger pointing promotes self-righteousness on both sides of the divide, even to the extent of causing the accused and the accusers to organizing into self-serving advocacy groups. You end up with the same forest with even more trees.

The entire system is perverse at its very core. I detail the responsible dialectic and offer one novel alternative in my most recent monograph, Citizen Patient. We must create a system that substitutes fees for serving for fees for service at every step in caring for the ill11. That starts with listening to illness narratives and goes all the way to palliative caring at the end of life.

We must create a system that recognizes and avoids small effects with as critical an eye as recognizing the ineffective. Furthermore, this can be honed to be pro-active. Why undertake trials if the best you can hope for are small effects? We have the epidemiologic wherewithal for this task. We need the ethical wherewithal to place patients’ welfare ahead of all other motivations. The system must be an infrastructure that serves the well-being of the patient and not the parasitic superstructure that it has become.

We must return health care to the bedside. Medicine is a philosophy nurtured by science. Patients are not simply the sum of data points12. We need poets as much as we need experts in informatics.


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33 Comments on "The Health Care Blame Game"

Jun 4, 2015

Nortin Hadler gets it right always. We must read every word he publishes and widely circulate to decion makers

Dr. Rick Lippin
“Charter Hadlerian”

Nortin Hadler
Apr 10, 2015

Thank you, Roberta
That’s so meaningful to me

Apr 9, 2015

Dr. Hadler has the skill to skewer all of the opportunists in the health care system and certainly the universities and their factory production mentality are part of the culture of hyper focus on the numbers and less on health. I recently attended the Lown Right Care Conference and found hope in the burgeoning number of physicians whom are banding together and involving patient advocates, to identify ineffective treatments and to promote better health through cutting waste. Orthopedic surgeons and cardiovascular surgeons both spoke at this conference, about abused practices i their fields. All I can say, is keep on leading us by the nose Dr. Hadler and we will eventually follow.

Apr 3, 2015

Dr. Hadler,

“There can be no “free market” when “caveat emptor” is inoperable”

Can you explain how this is so?

From my reading of your last several books, they might have each carried the title “Caveat Emptor”

If I might speculate on your train of thought….perhaps you see the attitude of “buyer beware” antithetical to the ideal of a trusting, empathic partnership between doctor and patient. I don’t see it that way….and I think given the hx of medicine….not to mention the current state of medicine you so well describe in this article and in your books…..the attitude is the proper one as one enters the relationship…..and over time the trusting relationship gets established between doctor and patient. But perhaps this is not what you had in mind.

Nortin Hadler
Apr 4, 2015

Paul, the trouble with strings of comments is they often devolve into parallel conversations. The assertion that troubles you relates to the discussion of financing systems and my earlier essays about health assurance – disease insurance indemnity schemes. It is peripheral to the “Blame Game” essay.

Jay Lozier
Apr 3, 2015

Bob, I think that bone marrow transplants for breast cancer as salvage for high dose chemotherapy went away after clinical trials showed it did not work. That is something that could be done systematically for clincal practices whose benefits are unclear. I don’t see anyone berating the insurance companies for not approving these, anymore. If there is evidence of lack of effect, I think the American people will accept it. And move to the next shiny object.

Canada would indeed have to pay more for drugs. No reason they shouldn’t. They are a prosperous first world economy. Ditto Germany, Britain.

Maybe they could re-import drugs from us after we negotiate lower prices with Pharma. Just kidding.

My opinion only, as always.

Apr 2, 2015

Thanks for good ideas, Jay.

In order to negotiate anything with success, the party which demands negotiation must be willing to walk away if they do not receive a decent offer.
So when Canada or Germany or Britain sets their price for a drug or a surgery, they are willing to let their citizens do without the procedure if the medical industry does not compromise.
I am not sure that the American government could be so bold. See the history of bone marrow transplants for breast cancer.

Also — and this may be a minor point — I think that the US government has in fact paid for most AIDS treatments through Medicaid.

Jay Lozier
Apr 2, 2015


Of course health care cannot be a free market when the patient is in an acute situation motivated by pain/urgency/time constraints (i.e., having a heart attack, etc), or unable to gain information about price or costs. You can only make it better for those parts of healthcare that are not so situated. Examples were healthcare is largely a commodity are childhood vaccines, colonoscopy, elective surgery that is not extremely complicated (e.g., hernia repair) and the like. We could do a lot of negotiation for lower prices on expensive things like factor VIII, cancer chemotherapy drugs, eculizumab and the like. It should be much more transparent, and the guy in bed A with insurance plan XYZ should not be paying some multiple of what the guy in bed B with insurance plan EFG pays, which will be different than what the homeless man pays, or the self-insured with money pays. The smoke and mirrors of the $50 aspirin that we let you have for $10 after BC & BS disallows most of the charge is part of the problem. Opening bids as gambits in a tedious negotiation where the patient is an over-awed spectator/pawn.

I could give you a route to incentivize charity care by letting a doctor deduct 100% of the price of doing charity care from his/her tax obligation. A physician in a high tax bracket (most of us) could pay the federal government 35% or do 35 charity care in their practice. A reason in my scheme that the doctor would have to have a set, published price for services. So what they say they are doing for free can be valued by what people who do pay (not another bogus assertion that the tax deduction for a procedure is $1000 (“list price”) but patients are actually only paying $200 for that service.

Doctors could do charity work in lieu of taxes.

Of course, the doctor’s fees are not what is bankrupting the system.

And the tweaks are all Rube Goldberg and lead to monstrosities like ACA with more than 2000 pages of statute and more than 20,000 pages of regulations. I would not even go to medical school if starting over again under this system.

The tweaks that would ensue from your column A and column B tiered health care plan would be interest groups trying to get “their” disease moved into the favored column through political action. All systems have their flaws.

As always, just my thoughts, and not any government’s policy, including the one I work for.

Nortin Hadler
Apr 2, 2015

Dear Jay, Paul, Peter, et al
Please consider:
1. Adam Smith not withstanding, the notion of a “free market” is very flawed. When it comes to health care, it is fatuous. There can be no “free market” when “caveat emptor” is inoperable
2. Tweaking the system is sophistical as long as the system is an end and not a means. “Single payer”, Obamacare, and the like are lost in process. I could care less about any system that considers patients units of care rather than people who have turned to physicians for support, advice, empathy and wisdom. This dialogue is the essence of rational care and path to ethical care.
3. I am focused on monetizing altruism. That’s my Hyperion.

Apr 2, 2015

“Let these be administered like the ESRD program, with negotiated payments to providers, defined criteria for treatment, standards of care in government facilities, etc.”

I can hear the screams already. “Don’t put government between me and my doctor.”

“Let the government establish rigorous criteria for these treatments, based on empirically demonstrated efficacty (bone marrow transplant for aplastic anemia, factor concentrates for hemophilia, eculizumab for PNH, etc.).”

“Death Panels.”

“Allow re-importation of drugs from anywhere the FDA can inspect a distribution chain, such as Canada, for instance.”

The Canadians control drug prices. Are we to justify re-importation because WE don’t have the balls to control our own prices?

Jay, you make a good case for single-pay. Bravo!

Jay Lozier
Apr 2, 2015

Nortin, a good piece, as always. I will play a round or two; why not? Dr. Hadler and I have batted some of these ideas around offline in the past; I know he doesn’t agree with all or even most of it, but here goes.

Certain things could be taken care of by the government similar to the end-stage renal disease program. Examples: transplantation of all types, treatment of expensive diseases such as hemophilia, PNH, sickle cell disease, cystic fibrosis, AIDS where the cost is ruinous to the private insurers. Let these be administered like the ESRD program, with negotiated payments to providers, defined criteria for treatment, standards of care in government facilities, etc. Putting these high ticket items in the hands of government would make insurance of “routine” care much more affordable for private insurers to cover. Let there be an income tax or a VAT to pay for this.

Let the government establish rigorous criteria for these treatments, based on empirically demonstrated efficacty (bone marrow transplant for aplastic anemia, factor concentrates for hemophilia, eculizumab for PNH, etc.). And negotiate for the best prices possible for the expensive drugs and biologicals to treat them. In the case where these high ticket items are of unclear benefit, pay for them only in the context of a study at NIH or elsewhere to determine if they work; otherwise, at your own expense. See high dose chemotherapy and transplantation for breast cancer. Not.

Negotiating prices as a consumer of healthcare is intrinsically problematic because once you are having a heart attack or delivering a baby, you are not in any position to negotiate anything more than the color of your hospital gown, if that. However, take some steps to make the price of medical services (not to be confused with the cost) more transparent, if not completely rational. Let practitioners provide any service to anyone at whatever price they want, but a) require that the price be the SAME for all comers at any point in time and b) post that information on readily available websites for people to actually shop for drugs/services on the basis of competitive pricing. I know the doctors, hospitals, and pharmacitsts will recoil in horror at the prospect of anyone knowiing what their services cost, but the system is so irrational that if you ask a doctor what he charges for a service, he or she cannot answer. Try it some time.

Allow re-importation of drugs from anywhere the FDA can inspect a distribution chain, such as Canada, for instance. The gradient in prices for drugs between the US and Canada is an artificial one, based on bans on re-importation and the fact that Canada negotiates for prices close to the marginal cost of production, not cost-of-development-plus. We should be negotiating prices with Pharma for the government provided services (as does the VA). I am not deluded into thinking we would drop to the current Canadian prices, but we would drop some while Canada comes up a lot.

Encourage but do not require use of electronic health record, and permit people to use those already created by the .gov and allow people to collaborate on joint efforts to create better EHR without anti-trust sanctions.
The VA apparently has a very useful EHR that all the Residents and Fellows who have been there think works very well. We paid for this. We should be able to use it as open source software.

Let insurers sell their products across state lines under Federal supervision if they care to. For that matter, if Apple or Ford or IBM want to sell health insurance let them do so, also under Federal supervision. It is just administering money and shuffling papers, not providing health care.

In all else, let a thousand flowers bloom, and do not make insurance into a one size fits all proposition. If the cost curve could actually be bent, as above, then health care would not be the toxic proposition that it currently is.

All these are just my personal opinions and (definitely) do not constitute US government policy, I hasten to say.

Mar 31, 2015

Dr. Hadler’s Disease Fund would not fund interventions lacking solid evidence showing effectiveness and efficacy (randomized controlled trials mainly)….and thus would dramatically reduce health care expenditures. People would still have the option to pay out of the Health Savings Account side of their program…..but the entire structure of the program would create a great deal of public debate on whether procedures are really beneficial….and thus people would become more discerning in their medical care consumption.

It is likely a reduction of at least 30%….and maybe 40%….would result. There would be major consequences for all provider systems and insurers…..they would fiercely fight this if it were proposed as legislation.

But a demonstration project could be very influential. Hopefully participants will be able to keep some of the substantial savings in the H.S.A part of the program….so they see this as good for them, not just a cost cutting program. Very exciting news Dr Hadler! I hope everything proceeds well!

Mar 31, 2015

Aurthur, watch the insults.

Total wages in this country are in the neighborhood of $6 trillion. This is an IRS number.

12% of $6 trillion is $730 billion.

Nortin Hadler
Mar 30, 2015

I’ve been modeling a fixed contribution, employer sponsored, fiduciary reform for 25 years. Citizen Patient is just one of the iterations. The next book (in press) offers an iteration that is ethical and feasible. The publication should be the prelude to a demonstration unless we run into an unanticipated stumbling block. I have before. Hope springs….

Mar 30, 2015

A 12% tax on wages would bring in about $720 billion.

I am not sure that is enough to pay every doctor and every hospital and every drug company what they expect to collect today for what is considered ordinary and necessary care.

Price controls would be needed.

(and I am absolutely not against controls, but I felt I should bring out that part of the single payer equation.)

Bob Hertz, The Health Care Crusade

Mar 30, 2015

A 12% tax on wages would bring in about $720 billion.

For about a month… please stop being statically stupid.

Mar 29, 2015

Hadler’s book Citizen Patient includes his proposal for reform of the health care insurance system which I summarized in an Amazon book review of the book (under the name Chenango):

establishment of a single payor system funded by a 12% tax on wages.

Dr. Hadler’s proposal is to divide the proceeds of the 12% tax into two funds. First is the Disease Fund to cover all medical interventions that have shown through randomized control trials solid effectiveness and efficacy….a shocking small percentage of common medical interventions. The second would be a Health Savings Account type of fund under which the patients have full control to use for other health services as they see fit (personal choice interventions like plastic surgery or poor choice things like surgery for lower back pain). Thus, patients will be full consumers with financial benefit from intelligent utilization and financial cost for questionable utilization. The HSA portion passes to heirs upon death. The HSA portion of his recipe has merit, but his confidence that the Disease Fund can successfully be restricted to strict efficacy and effectiveness standards strikes me as naïve.