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Pig in a Poke Health Reform

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Uwe ReinhardtFrom a political perspective, House Speaker Paul Ryan’s trashing of ObamaCare (a.k.a. the Affordable Care Act or ACC) during CNN’s recent town hall meeting probably was quite effective. One would, of course, not expect a staunch political opponent of ObamaCare to render a “fair and balanced” picture of the program, to plagiarize a Fox News mantra. Not surprisingly, the Speaker dwelt solely on some serious shortcomings of ObamaCare that are by now well known among the cognoscenti.

The question now is precisely what would replace ObamaCare, as Republicans fall over one another in their haste to repeal it. Enumerating principles, as has been done in sundry tracts in recent years and is done once again in the House of Representatives’  “A Better Way”, is no longer enough. Yet even at this time of imminent repeal of ObamaCare, the crucial details of any replacement plan remain a mystery. Surely the time has come to let the cat out of the bag.

During the town hall meeting, for example, Speaker Ryan proposed the general outline of a system that would rely on high risk pools for Americans with pre-existing medical conditions, coupled with a market for individually purchased insurance policies whose modus operandi was largely unspecified. What would be the parameters of the high risk pools? Granted, it would have been difficult to be much more specific on this point than the Speaker was in a town hall meeting. But it would certainly have been helpful had there been a website to which he could have directed his audience for the specifics of a replacement plan built on a Republican consensus.  To my knowledge, there is no such website.

Risk pools have long been the workhorse of Republican rhetoric on health reform. One can think of such a pool as just another health insurance company selling insurance in the individual market for such policies to relatively sick applicants for insurance. To assess the merits of the coverage it sells, one surely would want to know: 

Repealing the Right to Redistribute ‘Other Peoples’ Money’

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Republicans are having a hard time agreeing on how and when to repeal Obamacare. The Patient Protection and Affordable Care Act (ACA) is difficult to unravel because it was designed to alleviate a problem too costly for the government alone to fix. The health care law was passed to make medical care more accessible for low-income Americans and those with pre-existing conditions. This was to be done largely by socializing the costs and spreading the burden among a much broader segment of the healthy population. This is not unlike a pyramid scheme, where a broad base of people at the bottom get ripped so a few at the top can benefit.

Republicans have it within their power to use a process known as budget reconciliation to repeal Obamacare provisions that involve the budget, with a simple majority vote. For example, Republicans can repeal the taxes, fees and appropriations that fund the ACA. The individual and employer mandates, with associated penalties, can also be repealed. What Republicans cannot do is repeal the costly insurance regulations that drive up premiums for most people. That would require the help of perhaps a dozen skeptical Democrats.

A Policy Agenda to Address New Unintended Adverse Consequences of EHRs

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flying cadeuciiIn large part due to the $35 billion, Health Information Technology for Economic and Clinical Health (HITECH) Act incentives more than 80% of acute care hospitals now use EHRs, from under 10% just 7 years ago. Despite considerable progress, we have not achieved all that was originally envisioned from this transformation and there have been numerous unexpected adverse consequences (UACs), i.e. unpredictable, emergent problems associated with health IT implementation, use and maintenance. In 2006, we described a set of UACs associated with use of computer-based provider order entry (CPOE) (see Table 1).  Many of these originally identified UACs have not been completely addressed or alleviated, and some have evolved over time (e.g., more/new work, overdependence on technology, and workflow issues).  Additionally, new UACs not just related to CPOE but to all aspects of EHR use have emerged over the last decade.  We describe six new categories of UACs in this blog and then conclude with three concrete policy recommendations to achieve the promised, transformative effects of health IT. 

1. Complete clinical information unavailable at the point of care

Adoption of EHRs was supposed to stimulate a tremendous increase in availability of patients’ clinical data, anytime, anywhere. This ubiquitous increase in data availability depended heavily on the assumption that once clinical data were routinely maintained in a computable format, they could seamlessly be transmitted, integrated, and displayed between health care systems’ EHRs, regardless of differences in the developer of the EHR. However, complete clinical information on all patients is not yet available everywhere it is needed.

The Arc of Justice in Healthcare

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We all fear that phone call.  A medical report turns out the wrong way and life may never be the same.  When that call arrives we all have the same needs:  A doctor who cares, a place to go for treatment and the finances to afford what’s needed.  Starting on January 20th, some of my patients will join the 20 million whose lifeline to those fundamental needs becomes jeopardized.  

One of my patients facing this threat lost his job and health insurance during the 2008 recession.   Because he’s a diabetic and has a special needs son, no insurance company would sell his family a policy.   Why would they?   Diabetics and others with serious illnesses pose high risks for future health expenses.  Insurance companies make money by avoiding such risk.   After exhausting all the options, he sweated out 18 months with no coverage.   Finally, the roll-out of the California Exchange, funded by the Affordable Care Act (ACA), allowed him to buy an Anthem Blue Cross policy for his family.  

Do we really want millions of our fellow Americans to relive those nightmares?  We all benefit from the ACA’s fundamental commitment: That everyone deserves access to healthcare regardless of their ability to pay.  The policies guided by this principle moved us toward the achievement of universal coverage without changing the existing care of the majority of working families with employer based plans nor those with self-funded coverage.   

Why Surgical Volumes Should Be Public

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Her voice cracked with strain. I could imagine the woman at the other end of the line shaking, overcome with remorse about the hospital where her husband had had esophageal surgery. Might he still be alive, she asked me, if they had chosen a different hospital?

The couple had initially planned to have the procedure done at a well-known medical center, but when she went online to do her homework, she discovered that the hospital’s patient safety scores were poor. Another hospital in her community had stronger patient safety ratings, so they decided to have the procedure there.

It made sense. Why wouldn’t they go to a safer hospital?

What she didn’t know was that multiple studies over several decades have shown outcomes are better when procedures are handled by surgeons and hospitals with higher volumes, and while the well-known hospital had performed the procedure her husband needed many times during the previous year, the hospital they chose had done one.

Something Not So Terrific

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The brand new President Barack Obama, whether wittingly or not, invested his entire political capital in reforming health care in America. He gambled and he lost, not because he had nefarious intentions, but because he left the gory details to a corrupt Congress and a shady cadre of lying and conniving technocrats, ending up with something vastly different from what he campaigned on. From everything I’m reading now, Mr. Trump is about to walk in Mr. Obama’s footsteps, and if he does, the results will be unsurprisingly identical.

On the campaign trail, Mr. Trump repeatedly stated that Bernie Sanders forfeited his place in history when he “made a deal with the devil” and embraced the corrupt Democratic Party establishment that fought his candidacy in most abject fashion. Guess what? Mr. Trump seems to be making the same deal with the red version of the same devil. Mr. Trump’s cabinet choices indicate that he is now embracing the ultra-conservative factions of the Republican Party, the same people who actively or passive-aggressively opposed his candidacy. Nowhere is this peculiar and completely unnecessary capitulation more evident than in the beleaguered health care sector.

Not Normal Chaos

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The short version of Vox’s Sarah Skiff on “Why Republican disarray on health care doesn’t doom repeal efforts” would read something like: “It always looks this way in the throes of preparing major legislation. Remember how wild and confusing it was when the Democrats were trying to put together healthcare reform in 2009? Joe Lieberman was insisting on a public option, ‘pro-life’ Democrats were insisting that anti-abortion language be written in? Just because it’s chaotic doesn’t mean it won’t get anywhere.”

She’s right, of course — and she’s wrong in a significant way: In 2009 Congress was debating different policy approaches and the tradeoffs involved. There was never a question whether what they were attempting was possible, just whether it was possible to find a political compromise that could garner enough votes to pass. This meant that it was reasonably predictable that they would come up with something they could call “healthcare reform.” 

Congressional Republicans are up a different creek right now: What they are attempting is mathematically impossible. The things they and President Trump have promised do not add up. Literally. Their problem is arithmetic. Getting more people covered, with better coverage, with lower deductibles and out-of-pocket costs — all that will cost more money, lots of it. Getting rid of the tax penalties for not having insurance (the “individual mandate” that is the most-hated part of Obamacare) and the taxes built into Obamacare on wealthy people and on segments of the healthcare industry — all these will cost the government revenue, the very revenue it would need to pay for the better coverage of more people. All this while they aim to cut taxes and lower the deficit. And of course they have on every Holy Book within reach that they will repeal Obamacare, so they can’t just leave it in place. This means it is highly unpredictable what they will come up with, or that they will come up with anything at all.

Non-Alternative Facts About the Healthcare System

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The economic fundamentals of healthcare in the United States are unique, amazingly complex, multi-layered and opaque. It takes a lot of work and time to understand them, work and time that few of the experts opining about healthcare on television have done. Once you do understand them, it takes serious independence, a big ornery streak, and maybe a bit of a career death wish to speak publicly about how the industry that pays your speaking and consulting fees should, can, and must strive to make half as much money. Well, I turn 67 this year and I’m cranky as hell, so let’s go.

The Wrong Question

We are back again in the cage fight over healthcare in Congress. But in all these fights we are only arguing over one question: Who pays? The government, your employer, you? A different answer to that question will distribute the pain differently, but it won’t cut the pain in half.

There are other questions to ask whose answers could get us there, such as:

  • Who do we pay?
  • How do we pay them?
  • For what, exactly, are we paying?

Because the way we are paying now ineluctably drives us toward paying too much, for not enough, and for things we don’t even need.

A few facts, the old-fashioned non-alternative kind:

  • Cost: Healthcare in the U.S., the whole system, costs us something like $3.4 trillion per year. Yes, that’s “trillion” with a “T”. If U.S. healthcare were a country on its own it would be the fifth largest economy in the world.
  • Waste: About a third of that is wasted on tests and procedures and devices that we really don’t need, that don’t help, that even hurt us. That’s the conservative estimate in a number of expert analyses, and based on the opinions of doctors about their own specialties. Some analyses say more: Some say half. Even that conservative estimate (one third) is a big wow: over $1.2 trillion per year, something like twice the entire U.S. military budget, thrown away on waste.
  • Prices: The prices are nuts. It’s not just pharmaceuticals. Across the board, from devices to procedures, hospital room charges to implants to diagnostic tests, the prices actually paid in the U.S. are three, five, 10 times what they are in other medically advanced countries like France, Germany, and the U.K.

Does Life Expectancy Matter?

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U.S. life expectancy declined in 2015 for the first time in more than two decades, according to a National Center for Health Statistics study released last week. The decline of 0.1 percent was ever so slight ― life expectancy at birth was 78.8 years in 2015, compared with 78.9 years in 2014.  However, this reversal of a long-time upward trend makes these results significant.

While many researchers are scratching their dumbfounded heads in utter astonishment, I hypothesize the decline in life expectancy is partly due to the decrease in the primary care physician supply.  Studies have shown the ratio of primary care physicians per 10,000 people inversely correlates with overall mortality rate.  It is a well-known and reproducible statistical relationship that holds true throughout the world.  In the U.S., increasing by one primary care physician per 10,000 population, decreases mortality by 5.3%, ultimately avoiding 127,617 deaths per year.

Headlines last week highlighted how much these unexpected results left the researchers baffled.   Jiaquan Xu, a lead author of the study told The Washington Post, “This is unusual, and we don’t know what happened…so many leading causes of death increased.”   Age-adjusted death rates went up by 1.2 percent, from 724.6 deaths per 100,000 people in 2014 to 733.1 in 2015.  Death rates increased for eight of the ten leading causes of death, including heart disease, chronic respiratory illness, unintentional injuries, stroke, Alzheimer’s disease, diabetes, renal disease and suicide.  Differences in mortality were most prevalent in poorer communities, where smoking, obesity, unhealthy diets, and lack of exercise are ubiquitous. 

Interview with Mark Pauly: Part 1

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Community Rating – The Worst Possible Way To Do a Good Thing

I have a grudging respect for health economists, “grudging” because, like many doctors, I want my pieties unchecked. Health economists check our pieties with quantitative truths. They describe the way the healthcare world is – a view from 29, 000 feet, pour cold water on the way we think the world should be, and guide, with abundant disclaimers, the way we can make things better. It’s unwise climbing Everest without a Sherpa, nor is it wise reforming healthcare without listening to health economists from across the political spectrum.

President Trump, along with the Republican House and Senate, will be dismantling the Affordable Care Act (ACA). In a sense, President Trump is not just descending Everest, a treacherous feat in its own right, but scaling a peak arguably more dangerous than Everest. Despite their differences, Mr. Obama and Mr. Trump share one commonality – an implicit distrust of the health insurance industry.

How did the American health insurance industry become so vilified? This is, in part, because necessity is the father of all vilification. Insurers are a necessary evil in a country where there’s still deep mistrust of the government. Partly, this is because we transfer our angst about the uncertainty of our future, the dice which plays with our lives, to insurers who are in the business of rolling the dice. But mostly it’s because the misdeeds of the insurance market have been grossly exaggerated, and the benefits of the market have been attenuated by a few damning anecdotes. This is what Mark V. Pauly (MVP), Professor of Health Economics at the University of Pennsylvania, and one of the most eminent health economists of his generation, believes.