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POLICY/POLITICS: I love the guy’s moxie

Say what you like about Arnold, but you got to give him credit for being a proper flip-flopper with real moxie. While Bush drowns in his stay-the-course quagmire, Arnold has repudiated basically everything he claimed to care about when he first came into office, and is now running like the unaligned centrist everyone thought they were voting for back in 2003.

Today he called for universal coverage based on a comprehensive pay or play, surrounded by an individual mandate. He even brought back the notion of provider taxes, a beast last seen in the wild in the pre-HillaryCare years, but thought to be extinct having been shot by the AMA and AHA back then.

But my favorite of all is the fact that the pay-or-play employer mandate he’s calling for includes all employers with more than 10 employees. In November 2004, just 26 months ago, he told people to veto Prop 72, which had a pay-or-play system for employers with more than 20 employees. Boy, times and people change, don’t they!

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  1. “You are wearing blinders, pgbMD”
    Actually, I am clearing the air of the ‘smoke and mirrors’ that I see commonly espoused on this website.
    “…when physicians use new high-profit technology as cash cows.”
    Show me the data!!! I think I won this argument already.
    “Our health care costs are increasing at 17% per year”
    Wrong again!
    Using the per capita OECD spending data and calculating percent increases year over from 2000 to 2004 the USA has averaged 7% per year. The UK on the other hand is 8% per year. Additionally, just released data out of Washington stated via the LA times, “data show that in 2005, spending on healthcare grew 6.9%. That was the smallest rate of increase since 1999, and marked the third straight year in which the pace had moderated.”
    http://www.latimes.com/features/health/medicine/la-na-health9jan09,1,3515088.story?coll=la-health-medicine
    “Call it an axe to grind, if you wish…My kids and grandkids are the current victims of our “system,” and they are foremost in my mind.
    I have two twin daughters, so my family is vested in this economy just as much as you and we want to see this great economic expansion continue even during the very difficult times we live in. I will visit your websites. Take care and “fair winds and following seas” until the next time.

  2. You are wearing blinders, pgbMD, and no amount of real-life experience is going to convince you that we have a serious problem when physicians use new high-profit technology as cash cows. Our health care costs are increasing at 17% per year because …. well, just because! To the public: Get over it!
    My articles on the subject are at: http://www.throwtherascalsout.org/Lohman_articles.htm
    Call it an axe to grind, if you wish, but I would call it more a concern for where the whole economy is going, the health care system being just part of it. My kids and grandkids are the current victims of our “system,” and they are foremost in my mind. My web site at http://www.throwtherascalsout.org should make clear my motives.
    Perhaps when you move from public to private service you’ll better understand (though I could also claim that your motives are to protect the big bucks if and when that occurs).
    But unless you plan to stay where you are until you retire, you should read http://www.wisopinion.com/index.iml?mdl=article.mdl&article=5539

  3. “When that happens in a private clinic it is usually because the new system is a cash cow, not because they have tripled patient volumes.”
    Prove it! The same occurs in private practice as occurs in my military clinic, but because it is in private practice it is now somehow a “cash cow”. Please.
    “If I had access to insurance payments to physicians both before and after they purchased a system for their office, I would show you the data.”
    Of course insurance payments to a private practice will go up after the purchase of ancillary devices for in-office use! The real question that should be answered is, are the overall insurance reimbursements going to the independent labs/imaging centers PLUS private practice before and after a private practice purchases ancillary devices equal?? Below I assert that ‘X’ is roughly the same if not lower before and after a private practice physician office purchases ancillary labs and/or devices for in-office use.
    A+B = X
    A = reimbursements to an independent lab/imaging center
    B = reimbursements to a private practice doctors office
    X = total reimbursements paid out by insurer
    “I retired three years ago after selling my independent cardiac monitoring lab”
    Now everything makes sense. I will assert that if cardiologist offices did not increase their use of in-office Holter monitoring and echocardiography, you would have been able to sell your business for much more MONEY. Is there an axe to grind here?

  4. I have absolutely no issue with the volume of imaging increasing in a military facility tripling after installing a CAT scan, especially if the patient volume tripled as you imply. The physicians performing these tests are salaried and not ordering them because of a profit motive. When that happens in a private clinic it is usually because the new system is a cash cow, not because they have tripled patient volumes.
    I am not now nor ever have been a lobbyist for the device industry, nor do I have any financial interest in the field (other than as a knowledgeable patient). I retired three years ago after selling my independent cardiac monitoring lab, and what I say is the result of my experience in the field. But as I said earlier, don’t listen to me. Ask a friend in the medical equipment sales field for his opinion.
    But even if I were a device lobbyist the last thing in the world I would want to do is limit sales of devices into physician offices because that is the manufacturer’s lifeline. There are only 6000 or so hospitals and ten times the number of clinics. Selling only to hospitals maximizes equipment utilization and minimizes the number of devices sold. Selling to clinics reverses that by changing the economies of scale.
    “Show me the data” seems to be your way of denying that what I say is true. If I had access to insurance payments to physicians both before and after they purchased a system for their office, I would show you the data. My data comes from 25 years experience in the field.
    My lacking that access, if there are any health care representatives on the blog that is concerned with overutilization, I’ve just described the way to uncover abuses.

  5. “Our volume of in-office CAT scans has tripled since its installation”
    Sorry, the above should read:
    “Our volume of IN-OFFICE IMAGING has tripled since its installation”

  6. “You doubted what I call “overutilization,” the process of performing 15 Holters per month when only two patients need them. Or doing five times the number of echocardiograms than needed because they are profitable as hell.”
    Again, PLEASE SHOW ME THE DATA supporting your assertions.
    Maybe as a Holter monitor supplier you saw the cardiologist’s office volume of testing go up after you sold them a monitor. Isn’t that what you would expect and what should happen? Show me the data that supports your notion that that same cardiologist’s office didn’t order the same number of Holter monitor tests per patient before and after acquiring the on-site Holter monitor. Are you sure you do not represent a device lobbyist, supplier or testing laboratory, because these entities do stand a lot to gain if physician in-office testing is banned.
    As you know, I work in a military facility and I am salaried. We have a CAT scan that was recently installed into our clinic. Our volume of in-office CAT scans has tripled since its installation. I crunched the numbers and the number of CAT scans ordered per patient was roughly the same before and after the installation. Before the CAT scan installation, we referred the patients to the radiology department where they would wait for weeks and risk a higher medical error rate (error rate in terms of patient mislabelling, wrong test done, etc). In our department the CAT scan is done the same day and we know our patients, thus the medical error rate is nearly zero.
    Finally, I do believe for the device and testing industry there is a “profit motivation” that does exist to ban physician in-office testing that probably goes into the billions of dollars. Therefore, the answer to your question, “[Does] the profit motivation exists?”, is clearly yes, but for the DEVICE INDUSTRY.

  7. I just re-read your post, pgbMD. I said “overtreating,” what I would describe as unnecessary treating, is not a major factor.
    You doubted what I call “overutilization,” the process of performing 15 Holters per month when only two patients need them. Or doing five times the number of echocardiograms than needed because they are profitable as hell.
    I’m sure you agree that treatments and testing are two different things.

  8. What data needs proving? That tests are becoming easier to perform or that it results in higher utilization in the physician’s office? I didn’t think either claim was under dispute.
    I would agree that getting rid of the fee-for-service model is difficult under current or even a Medicare-for-all system, though not impossible. Clinics could put physicians on salary and not reward them for procedures performed, but since they are usually partners in the clinic that is negated.
    But they could prohibit the expensive and profitable tests from being performed in the clinic setting, unless by an on-site independent lab as described above. This would provide the so-called convenience without the profit motivation.
    And I guess, pgbMD, I’d ask: Is it that you deny the profit motivation exists?

  9. “I don’t know where I’d find a quick copy of the “over treating” stats, but maybe others know where they are. I would agree that this is not a major contributor.”
    I agree as well that you are overemphasizing “overutilization” a bit.
    “tests being “easier” should not justify the overutilization of which we are agruing, especially when in the hands of the physician with dollar signs in his eyes.”
    Show me the data to back up your claims.
    “If a salaried system (sans “production incentives” or salaries that rise with production) could be developed, that would be acceptable.”
    Salaried systems can work in academics and large HMO systems, but not in private practice. You would need to outlaw the private practice of medicine to do this. Last time I checked you have some Constitutional issues to deal with here.

  10. Barry, tests being “easier” should not justify the overutilization of which we are agruing, especially when in the hands of the physician with dollar signs in his eyes.
    I wouldn’t have a problem if a clinic were to lease space to an independent lab so the patients could be tested on site, but few physicians would allow those profits to go into the hands of others. They want ownership in that lab so it is they who can benefit from the ordering (and subsequent over-ordering). pgbMD does not face that criticism because he is salaried, but when doctors’ incomes are based on the amount of tests that are ordered or not ordered, the public gets ripped off.
    >>> “I would bet a lot of money that high deductible health plans will save money for the system overall.”
    Barry, as we “save money” the quality of care will go down and people will die earlier. Hopefully it doesn’t affect my or your families, but somebody is going to die earlier as a result.
    With all of the arguments you present, you ignore that countries such as Canada have not seen these dire predictions come true. Their cost remain at 10% of GDP and ours are at 15%, and they do not have dead bodies lined up on the streets. (Though I believe they have a moderate co-pay.)
    Identifying high utlilizers will not capture all overutilizers, which are the bulk. If a salaried system (sans “production incentives” or salaries that rise with production) could be developed, that would be acceptable.

  11. Jack,
    Even if we put aside the issue of doctors’ financial incentive for a moment, as technology makes procedures easier and less uncomfortable for the patient, more of them are likely to be performed, other things equal. Virtually all imaging is comparatively easy for a patient, even if he or she has to drink a contrast solution first. Several vials of blood can be drawn in, probably, 30 seconds as the patient endures little more than a pinprick. X-Rays are a breeze. Standard stress tests, thalium stress tests, and stress echos are all pretty easy on the patient. Yet, plenty of money can be spent on these cumulatively.
    Some single payer enthusiasts argue that healthcare should not be a financial transaction at the point of service (no co-pays). If both the doctor and the patient perceive services as “free,” demand for service will be astronomical. As co-pays are introduced, utilization goes down. All of the PBM’s and major drug chains have voluminous data that shows this. As deductibles go up, utilization also goes down because people start to care about costs. You and others argue that people will not get necessary care and will be more expensive to treat later when they get sick. While that could happen sometimes, I would bet a lot of money that high deductible health plans will save money for the system overall. As price and quality transparency tools improve, they will save even more money as patients seek the most cost-effective providers of imaging, blood tests and other services and doctors learn to direct their patients to those facilities without being asked.
    My earlier comments about individual health risk and quality of life scoring, coupled with tracking overall spending incurred by each individual and driven by each doctor will help to identify high utilizers. If those doctors cannot improve their practice patterns over a reasonable timeframe, they could risk being eliminated from the insurer’s network. In theory, a Medicare for All system could impose the same sanctions if it had credible data to back it up. The presence of systems where doctors are salaried (no financial incentive to do excessive testing even if they have the equipment in their offices) like Kaiser and the VA could also provide us with important information about practice patterns which could then be compared to risk adjusted outcomes among doctors and practices with different financial incentive structures. While a doctor could easily defend large spending on a particular case in an attempt to find what works best for that person who was difficult to diagnose and did not respond as expected to standard treatments, statistical analysis of patient populations in the 1,000 – 2,000 or more range (considerably more for group practices) can tell us plenty about who is cost-effective and who isn’t.

  12. I should clarify that when I said over treating is not an issue, I meant the medical consequences thereof. Not the high cost of the tests (which is a major issue).

  13. You are giving patients more credit than they deserve. Yes, there are some very intellegent ones but there are also others (most) that think doctors walk on water.
    I don’t know where I’d find a quick copy of the “over treating” stats, but maybe others know where they are. I would agree that this is not a major contributor.
    And you are also giving physicians credit where it is often not due. I have the highest regard for “most” physicians, but I also know which ones to avoid in my community. My own cardiologist refused to give me a cath until he sent me to another facility for a fast CT (which fortunately showed zero plaque). And while I’ve done business with cardiologists for 25 years and know the field, most patients are not that fortunate. I can point to those who should not be in practice, which points to a medical community that has no policing.
    I also don’t doubt that Part B reimbursements are lower than Part A, but whatever savings there may be are more than eaten up in increased volumes. Yes, insurers will usually catch the most agregious abusers, but the bulk of over testing sails through without challenge.

  14. “The doctors are not charging less, they are charging the same and pocketing profits. This does not decrease costs, it increases utilization.”
    I will look into this, but from what I have been told, in-office labs/x-ray/ancillary are reimbursed by the insurers less (approx 80%) than what they pay the hospitals. Also, the insurers follow utilization very closely, if they think there is overutilization, they will decrease reimbursement significantly for in-office. My guess is that for now they are saving money compared to paying for in-hospital services.
    “…and even more so by treating patients for problems they don’t really have.”
    Come on now, show me the evidence, besides some anecdotal incidents (such as the quack cardiologist out west that was cathing everyone that came in through the door). Most patients will not go through time consuming and sometimes invasive tests unless they know they need them. Please give us hard working physicians and the patients some credit.

  15. But wait a minute pgbMD. The doctors are not charging less, they are charging the same and pocketing profits. This does not decrease costs, it increases utilization. Any savings that “may” be gained will be more than offset by increased volumes, and even more so by treating patients for problems they don’t really have.
    My statement on HDPD is indeed conjecture and thus my “wait ten years” suggestion. But as a physician I don’t see why you would want anybody standing between you and the patient, whether it be business leaders, insurance companies, banks, or even the threat of high out-of-pocket costs for the patient who delays needed care.

  16. “new blood testing device that could be held in the hand and do the same bank of tests — in the doctor’s office — for $2500 instead of $25,000. You cannot imagine the excitement of this company’s CEO about the prospect of letting the doctors make all of the money instead of having to send their patients to the hospital or independent lab.”
    I agree with most of what you have said. The above underscores my belief that as technology becomes cheaper, more and more ancillary services will become available in the doctor office. The insurance industry and Medicare realize this and see savings in this movement away from the hospitals. For in-office ancillary services and minor surgical procedures Medicare reimburses the physicians office, but at a discount to what they pay the hospital. In the end they realize a savings by keeping as much away from the hospital as possible.
    “HDHPs and HSAs are accidents waiting to happen. In 5-10 years we will see that not only have we redirected the costs to someplace other than the patient, we have also increased credit card debt and bankruptcies.”
    Of course this statement is conjecture and not based in an evidentiary data. We will just have to see where the HDPD movement takes us. My guess it will lead to lower healthcare utilization especially when combined with an HSA.

  17. Barry, this is not “at the margins” — it is an absolute up-front problem and very often the only reason physicians make the investment. If they don’t have an extra room for the new equipment, they will move into bigger space and increase their overhead to accommodate their investment. But even after the profits offset the extra space costs there will still be a huge net gain and incentive to give every patient walking in the door an echocardiogram (or whatever). And in the process their volumes are deducted from the volumes at the hospital and the economies of scale for both facilities are trashed.
    But don’t take my word for it. If you know a medical equipment salesman ask him how dependent his job is on the profitability of his product. For ten years prior to starting my independent lab (Holter, mobile echo, cardiac event monitoring), I sold medical electronic equipment to hospitals and clinics and saw the motivations behind buying and utilization. And don’t tell me this is up to the patient to monitor, because they do and should trust their doctors.
    I mentioned in another post the situation where my local hospital leased time from a mobile MRI service until their volumes reached a point that they could buy their own MRI system. Once they made the purchase the two local clinics quit sending MRI patients because they signed up to the mobile MRI service themselves (and pocketed the profits). This goes to pgbMD’s posted link above, where a hospital lost its profits on another service. As long as the physician controls the patient they will control where and how many tests are performed. This is not patient convenience, it pertains only to physician profitability. That’s the “free market” we have today and it must stop. The only competition is between the hospital and clinics, and the physicians and their overseers.
    You convinced me a long time ago that a universal database showing physician and hospital qualities and utilization would be useful, and that would go a long way to shining light on these problems. Not just for practice patterns but also practice variations. But I don’t see this as a means to eliminate the conflict of interests described above.
    Be careful when you follow “practice patterns compared to one’s peers.” The old “usual and customary” argument falls apart when all physicians start increasing their charges and equipment purchases.
    You mention insurance companies twice and adjusting payments for health risk and etc. Why not eliminate insurance companies altogether through a Medicare-for-all system and eliminate the extra administrative costs you propose? Why not just let patients go to doctors and the doctor’s treat the patients the way they have been trained to do (with the help of the national database showing practice variations etc etc.)? I trust doctors more than I trust insurance companies, through I trust neither when it comes to maximizing profits and minimizing costs.
    And pgbMD, that goes to the issue of smaller and cheaper that you bring up. I was recently asked to assess the wisdom of investors buying a company that developed a new blood testing device that could be held in the hand and do the same bank of tests — in the doctor’s office — for $2500 instead of $25,000. You cannot imagine the excitement of this company’s CEO about the prospect of letting the doctors make all of the money instead of having to send their patients to the hospital or independent lab. Talk about cash cows, this is it.
    And I’ll never forget the words of a cardiologist friend who told me as he was canceling my Holter service “I’m sorry Jack, I’ll never be able to match your quality but Medicare rules now make it more profitable for me to do the tests in my own office rather than send them to a lab.”

    pgbMD, you hit the nail on the head: a Medicare-for-all system will not decrease spending, it will eliminate insurance profits and marketing costs and redirect them to physicians and hospitals and in the process provide service to 100% rather than 85% of the people. I think we can all be pleased with that outcome.

    HDHPs and HSAs are accidents waiting to happen. In 5-10 years we will see that not only have we redirected the costs to someplace other than the patient, we have also increased credit card debt and bankruptcies.

  18. I can see your point, but as technology has become smaller and cheaper, high technology imaging and other diagnostic testing in the office is just an extension of the physician physical exam. As the device companies improve their technology, it will become cheaper and smaller and thus more amenable to office use. As a patient, I would rather have the test done in the office, rather than a large impersonal hospital where private medical information is exposed to possible misuse and where there is a higher likelihood of medical error. The future of medicine is in the doctors office not in some satellite lab or diagnostic imaging center.
    Additionally, I need to clarify my position on a “Medicare for all” system. In my opinion, such a system with the previously mentioned 6 conditions would preserve patient autonomy and guarantee patient access. The funding for “Medicare for all” may already be in the system with respect to health insurance administrative costs. However, I don’t believe such a system would reduce overall spending. It would probably be a wash, but the one caveat is that everyone would be “insured”.
    Offering a mandate-free HDHP with or without HSAs is the more libertarian way to go and has the best chance of reducing overall spending without a significant amount of overt rationing.

  19. Jack,
    I agree that when a doc has expensive equipment in his or her office, there is, at least at the margin, more incentive to use it. On the other hand, it is much more convenient for the patient if the procedure (assuming it is actually needed) can be done either on the spot or with a much shorter wait time than would be required if the test had to be scheduled elsewhere.
    In 1999, my cardiologist referred me for a stress echo which, at the time, was done in a hospital in NYC. I had to wait six weeks for an appointment. I happen to now need this test every two years or so. My doc has the necessary equipment in his office, and I can get it done usually with a two to three week lead time.
    I think one potential solution for the self-referral problem you describe could be to attempt to develop a reasonably decent system of individual health risk scoring, along with quality of life scoring. The health risk score would be intended to predict how much in healthcare services the individual is likely to consume over the next year or, perhaps, five years. The quality of life score would speak to such issues as any limitations on normal activities of daily living (ADL’s), pain, ability to walk, see, hear, etc. A health risk assessment and conditions the patient already has (if any) could go into developing the risk score.
    The scoring system would only have to be good enough to be useful and relevant at the practice population and insurance risk pool levels, not the individual patient level. If it were in place, medical providers (including hospitals) could be more effectively challenged if their practice patterns and procedures were resulting in significantly higher costs than their peers were incurring but with little or no difference in outcomes adjusted for the health risk of the served population.
    Another benefit of such a scoring approach is that, under community rating and taxpayer funding (premium support or voucher approach), payments to individual insurance companies could be adjusted both up and down for the health risk of the population that chooses that carrier. This would largely eliminate any incentive to try to attract healthy people and avoid sick ones. CMS is already doing this (I don’t know how well) to adjust payments to insurers offering Medicare Advantage plans.

  20. I suppose that “within the scope of the specialist’s practice” means that the system is then safe from over-ordering of profitable tests by the physician? I don’t think so. I spent 25 years providing Holter scanning services and had physicians who did two Holters a month buy their own Holter scanners and all of a sudden their volumes jumped to 15-20 per month. Yeah it was within the scope of their practice but it was also profitable as hell. I could describe similar situations with echocardiograms, MRIs, you name it.
    There is no way around it? There is indeed. All the physician has to say is “I think you need an echocardiogram (or CT, MRI or whatever), and we’ll set up an appointment for you at the hospital down the street. They are the best equipped to handle it.
    Self referrals are a major source of over-utilization. When physicians make investments in high tech and expensive equipment there is always pressure to make sure the volumes support it.

  21. If you want reform you have to be willing to give and take a little. As long as the ancillary services occur WITHIN THE SCOPE of the specialists’ practice I see no problem with it. In the era of modern day medicine, high tech ancillary services are here to stay and patients demand and want it in their doctors’ offices. There is no way around it.

  22. >>> “6. Specialty physician groups are allowed to provide ancillary services within their scope of practice without limitations.”
    Let me add another wait-and-see precaution. With our current fee-for-service system, giving physicians unlimited latitude to provide highly profitable ancillary services (echocardiographic, MRI, CAT scan, etc) introduces what you and I know to be “self referrals” which at one time were considered fraudulent. I see no way of keeping the physician at arms length here, and over utilization for the sake of profits could be substantial. Call some of that testing “defensive medicine” if you will, but I’d feel a hell of a lot better if these tests were referred to a legitimate hospital or lab that the physician had no financial connection to.

  23. I agree totally with items 1-6, but with one wait-and-see precaution. The certificates of need are very necessary under the current free-for-all system but hopefully wouldn’t be needed under a Medicare-for-all system which would limit patments and eliminate cost-shifting and unpaid bills.
    We do indeed need medical liability reform, and I support a 3-person medical jury of the physician’s peers (not the patients’). Retired (or at least out-of-area) physicians and nurses would work best. Any punitive damage awards should go into the Medicare fund rather than to the patient or lawyers.
    And you may be right that the VAs are (or should be) offloading the tougher cases, but I like their salaried physicians as opposed to the current fee-for-service system. But with some limits on over-charging that would hopefully be mitigated.

  24. “The higher levels, like Bethesda Naval Hospital, I am sure differs from the lower levels, like Tricare.”
    Believe it or not, I am in a “higher level” medical center than even Bethesda. We are the largest per patient volume medical center in my service in CONUS. Additionally, TRICARE is the military HMO and is present at Bethesda and covers all active duty military, retirees and dependents.
    “The VA Medical system has turned into one of the best, with a patient satisfaction rate greater than the private free-market system you espouse, and they do it for about 40% less dollars.”
    Again, these bogus surveys need control groups to be of any value. We care for many VA patients that are sent to us b/c their needed care is beyond the scope of the local large VA hospital. The last place I would send a family member for care would be any VA hospital. In my opinion, they are centers for incompetent substandard physicians. Recently, I took care of a patient that was injured at a VA medical center after the attending surgeon allowed 2 resident surgeons to operate on him unsupervised. It resulted in a disastrous significant permanent injury to the veteran.
    “…to do it right means funding it well and paying physicians well. It means transferring the 20% of the costs currently going to insurance company profits and marketing overhead to the health care side of the equation…If Medicare is done right, people will not need to go outside that system, but if they want to, let them… If they starve Medicare like they have in Canada, and wait times grow, we will have the same problems…Should we allow boutique medicine? I suppose we’ll have to…But if Medicare is allowed to do what it should do — to treat patients appropriately and without delay — I expect there will be little room for boutique doctors…”
    You make a compelling argument. I would consider such a single payer system, only if:
    1. Patients are still allowed to pay for private services without restrictions (the current 2 year Medicare opt-out window needs to be abolished).
    2. Private medical insurance is allowed for those that want to pay for it.
    3. Medical liability reform takes place instituting health courts and pain & suffering caps nationwide.
    4. Certificates of need are dissolved.
    5. Medicare physician reimbursements are kept where they are and allowed to increase with the rate of inflation annually.
    6. Specialty physician groups are allowed to provide ancillary services within their scope of practice without limitations.

  25. >>> “Actually, I am a military physician/surgeon that sees government run healthcare and its ensuing bureaucracy up close and personal everyday. I hate to break it to you, it is a disaster.”

    It may very well be that the segment of military medicine you are in is a disaster, but much of it is not bad. The higher levels, like Bethesda Naval Hospital, I am sure differs from the lower levels, like Tricare. The VA Medical system has turned into one of the best, with a patient satisfaction rate greater than the private free-market system you espouse, and they do it for about 40% less dollars.
    Yes, I would expand Medicare to all those who want to utilize Medicare; which frankly, will probably be most everybody if it is done right. And to do it right means funding it well and paying physicians well. It means transferring the 20% of the costs currently going to insurance company profits and marketing overhead to the health care side of the equation. If Medicare is done right, people will not need to go outside that system, but if they want to, let them. If they starve Medicare like they have in Canada, and wait times grow, we will have the same problems. Count on it.
    Should we allow boutique medicine? I suppose we’ll have to. Then doctors can stick it to the rich. But if Medicare is allowed to do what it should do — to treat patients appropriately and without delay — I expect there will be little room for boutique doctors.

    >>> “What happens when under your new “Medicare for all” system you realize that the costs are the same if not more?”

    Give me a break. Medicare Advantage, which is Medicare contracted to private insurers, costs 12.5% more than Medicare itself. So much for private industry being more efficient than the government. And keep in mind that Medicare today is filled with us old geezers that consume the highest amounts of care. Meld into the Medicare system all the lower cost patients and you’ll see their per-capita costs decrease even more.

  26. “Well, of course I’d expect that. You are first a physician benefiting from the current system and secondly a consumer of it. I would expect you to want to leave things as they are.”
    Actually, I am a military physician/surgeon that sees government run healthcare and its ensuing bureaucracy up close and personal everyday. I hate to break it to you, it is a disaster.
    Are you suggesting that we expand Medicare to cover everyone? Under your plan would you outlaw private pay insurance? Would you unconstitutionally ban private contracts between physicians and patients as under current Medicare rules? What happens when under your new “Medicare for all” system you realize that the costs are the same if not more?

  27. Physician preference for single-payer is actually about 60%, and we already have one of the best. It’s called Medicare and it uses the private physician network. But it doesn’t allow billing of procedures at 20 times the norm, so some physicians don’t like it.
    >>> “I will pay the extra private money into the current system to keep the choice, freedom, and access we have rather than let some bureaucrat in Washington run the entire show.”
    Well, of course I’d expect that. You are first a physician benefiting from the current system and secondly a consumer of it. I would expect you to want to leave things as they are.
    Follow the dominoes, pgbMD; you won’t like the outcome.

  28. “It must boil the hell out of you physicians that their system actually works.”
    Actually as a physician, it does not really matter to me what system is in place. I would estimate that at least 25% of physicians are single payer cheerleaders.
    I argue against the single payer mandate purely as a libertarian and patient advocate, because I have seen government run healthcare up close and personal.
    In the USA we have a “great” system that is cherished by the socialist left and is 100% fully funded by the taxpayer from one captured “pool” of payers. In fact, it is so jealously guarded by those government single payer advocates that the taxpayer dollars used to fund the system can never be used for a private system that has better outcomes. In US dollars in 2005 this system cost the taxpayer a mere $7560 per year per enrollee. Similar systems in the UK, France, and Germany cost $4415, $4777, and $4237, respectively, in 2005. One may ask, why is the spending for our system double that of other like nations? The expected answer of course would be that we are getting a better service. Unfortunately, the truth is that our system ranks 25th out of 30 OECD nations.
    This system of course is our very own single payer government run primary school system.
    A single payer healthcare system in the USA will no doubt have similar fiscal outcomes, costing twice as much and at the same time provide worse service with even worse outcomes. I will pay the extra private money into the current system to keep the choice, freedom, and access we have rather than let some bureaucrat in Washington run the entire show.

  29. Do the math pdbMD. They are spending only 10% of GDP for health care and a 10% increase to 11% of GDP “might” increase their per-capita tax by about $300 per year. Let the people vote on that — versus our 15% of GDP ripoff — and they’ll jump at it. There are already groups in Canada pushing their politicians for exactly that. And these are not special interest groups, they are citizen groups.
    It must boil the hell out of you physicians that their system actually works. But if physicians had any business sense at all they’d see where our current system is going. It’s called “managed care for all,” and you won’t like it a bit.
    If you haven’t already I would recommend assessing where you think the system is going, and how you are going to overcome the business interests behind that direction. See:
    http://www.throwtherascalsout.org/How_doctors_are_yielding.htm

  30. “Improve funding and they will solve their problem.”
    What are you suggesting then? Raising taxes in Canada? That is a novel idea, but not surprising from a single payer cheerleader.

  31. My point was that with additional funding they could add their own mobile vans to mitigate the backlog, but leave it to a free-marketer to use it to support a US system that is ripping off the public. I was also talking about having the mobile MRI provider contracting directly with the government, not sending the work through a mish-mash of for-profit insurance companies that add nothing to patient care.
    And while your point of the after-effects is appropriate, it again points to a Canadian system that is underfunded, not improperly structured. Improve funding and they will solve their problem. Adding funding here has just made ours the most expensive system in the world!

  32. “why don’t your politicians from time to time contract with some of the US mobile MRI services to come into your country to catch up on the backlog and reduce the pressure? Maybe once or twice a year, or maybe they need to establish their own traveling vans to visit the hot spots.”
    That is a nice “free market” idea! The problem is that once you open the MRI backlog you then will have the backlog at the next step in the game, such as, shoulder arthroscopy or hip replacement. But, then again, maybe you can just contract with US surgeons and hospitals to take care of that too. What happens if the US system goes single payer? No where for the runoff to go. Maybe Mexico?

  33. Good post Mike. You can bet your bottom dollar that the more effective the Canadian system, the harder the for-profit interests will work to overturn it. Let’s hope your politicians listen to the voters. But on top of that, you need a major push to move funding higher to get rid of the wait times.
    But as well, with the wait times being what they are, why don’t your politicians from time to time contract with some of the US mobile MRI services to come into your country to catch up on the backlog and reduce the pressure? Maybe once or twice a year, or maybe they need to establish their own traveling vans to visit the hot spots.

  34. Interesting posts. From time to time, there are some Canadian politicians and private medicine marketers who suggest that we need to rethink single-payer public health insurance north of the 49th parallel.
    I think one of the best argued positions (aside from the stats which have already been thoroughly canvassed in this thread) for our single-payer system of health insurance comes from the former head of one of our largest chartered banks.
    “The system covers everyone. Therefore economies of scale are maximized. There is no rating or discimination. Therefore, large administrative savings occur. This system is financed through general revenues. Therefore, there is no costly, stand-alone collection system. And payments are provided directly to physicians. Therefore expensive multi-stage billing is avoided. In other words, not only is our system more fair than the alternative, it is also more affordable.”
    -A. Charles Baillie, former chairman and CEO, TD Bank speaking to the Vancouver Board of Trade in 1999.
    Here’s a link to his whole speech, which is worth a read: http://www.td.com/communicate/speeches/15apr99.jsp
    By the way, you might be interested in this website — part of a campaign we’re running in British Columbia to avoid the erosion of our public insurance program — which illustrates the relative cost effectiveness of public health care compared to the alternative. You can have a look at http://www.bchealthconversation.ca

  35. ** have little to do with administrative costs.

    That is not consistent with all of those knowledgeable about the two systems.

    ** They have to do with the fact that doctors and other providers earn more in the U.S.,

    That we do, and we charge more frequently due to over-utilization of our high-profit procedures.

    ** we probably incur far higher costs than other countries due to differences in approach to end of life care,

    Well, they seem to keep their people alive longer than we do.

    ** defensive medicine is a material issue here which some docs estimate could add $100 billion per year to healthcare spending for tests intended to protect against lawsuits but are not considered medically necessary.

    I have read that Canada actually has a higher per-capita occurrence of malpractice lawsuits, but in our case the defensive medicine you talk about adds significantly to the profitability of a clinic and ultimately to the salary of the physician after all “production bonuses” are tabulated.

    ** Under single payer, there is also a risk that fraud could become an even worse problem than it is now.

    That is incorrect Barry. Doctors are very afraid of Medicare fraud because of the jail time involved. They are not afraid of fraud in the private system because at worse it is a lawsuit to return funds.

  36. Well Barry, Canada must be doing it with smoke and mirrors. They are providing more comprehensive access to quality and affordable healthcare, for all citizens at far less cost. Paperwork is less, but only part of the reason. How healthcare is funded and managed is a huge reason why things cost less. Physicians make less, drug companies make less, equipment providers must be aware of hospital budgets when pricing. Hospitals have tight budgets, physicans must negotiate their fees, there is not a new and latest machine on every corner, and yes elective surgey has wait times. You can’t have it all. But the goal is healthcare NOT profits. That is a distinct difference that runs the whole system. The culture in the U.S. healthcare system drives every little cost and input to higher and higher amounts as margins are compounded. We act to healthcare costs like we act to energy – there is no limitation needed on the resource. All these new state schemes only address added premium input they don’t seriously control costs. They expect the system to somehow fix itself – it won’t.

  37. According to single payer advocates, a key benefit would be much lower administrative costs. At the same time, John Fembup has said repeatedly that we need to be careful to distinguish between the cost of healthcare and the cost of health insurance.
    The cost of healthcare is currently pegged at something over $2 trillion or about 16% of GDP. This includes costs for hospital charges, doctor fees, imaging, drugs and devices, assorted therapists and claims processing. The bulk of the costs that a single payer system would presumably eliminate are not included in this number. These include: insurance company profits, costs related to medical underwriting, commissions for insurance brokers, fees paid to consultants, etc. Actual administrative costs that could be eliminated by healthcare providers appear minimal at best. Life would be simpler for PCP’s, but since so many of them are either in solo practice or very small group practices, the potential to eliminate administrative staff is very limited. To the extent they are successful in doing so, they would probably attempt to capture most of the savings for themselves rather than reduce their charges. Savings as a percentage of revenue would be much smaller for higher fee generating surgeons and other specialists. They would be minimal for pharmacies, imaging centers and hospitals and near zero for drug and device manufacturers. In the case of hospitals, for example, a large academic medical center generating $1 billion in annual revenue would save, at most, 0.6% of that amount if it could eliminate 100 people from its business office assuming average compensation of $60K each.
    At the same time, suddenly covering the 46 million uninsured will result in higher healthcare utilization, since all these people would have insurance. Many of the poor among them, along with many current Medicaid beneficiaries, will continue to access emergency rooms for their primary care because they don’t have an ongoing relationship with a doctor.
    My conclusion is that our high healthcare costs (as defined by the data) have little to do with administrative costs. They have to do with the fact that doctors and other providers earn more (and charge more) in the U.S., we probably incur far higher costs than other countries due to differences in approach to end of life care, and defensive medicine is a material issue here which some docs estimate could add $100 billion per year to healthcare spending for tests intended to protect against lawsuits but are not considered medically necessary. Under single payer, there is also a risk that fraud could become an even worse problem than it is now. If meaningful savings are to be achieved, I think the only way to get them is to try to squeeze provider payments and pursue either implicit and/or explicit rationing. If people, thorough their representatives choose to take reform in this direction, so be it, but at least understand the bargain before you make it.

  38. Stuart, I’ve watched your “brain surgery” video (and I think everybody should). It is an excellent reason why any single payer system must be “properly funded,” and the very reason why the for-profit interests in Canada continue to lobby their government to lower health care spending. It’s called “starving the system” and is intended to push people toward a privatized system north of the border.
    But let me tell you something that may be a real shocker: I am on Medicare in the US and there are no wait times here because it is properly funded! That’s because they spend 10% of GDP and we spend 15%.
    If the Canadians proceed with a private option to compete with the public system they will become a mish-mash like the US with cost shifting and complex formulas created by the profit mongers. Given a “properly funded Medicare system” versus what we have in the states, I’ll take single-payer any day. There is absolutely no role in health care for an insurance industry that drains resources and provides no direct care.
    The Canadians should look at what private interests have done to the US and properly fund their system to eliminate the disparities we know to exist.

  39. Barry, with Canada’s higher social support network and possibly better public health infastructure the poor may be able, through awareness, to take advantage of a health system that provides better access. I agree that poor people with little knowledge to use the services provided or ignorance about prenatal issues will not give any system good healthcare results. So what does your comment about the poor in America verse Canada really say about a whole range of issues in this country.

  40. Barry, you can argue whether their infant mortality advantage is 35% or zero, and it matters not. What matters is that the Canadian “system” is better than ours in virtually every respect, except perhaps, on wait times for elected procedures. That they could solve that with a simple 10% increase in spending. The only way we seem to be able to solve ours is to add complexity and costs that will protect the insurance industry.

  41. When you begin providing health care to 45 nillion people who have been without it, including some who are pregnant women, I don’t know how you could argue otherwise. Argue the numbers if you will, but the improvement cannot be anything other than stated.

  42. Jack – I’m not disputing the generally available life expectancy and infant mortality rate data.
    I’m wondering how you can draw the conclusion that a single-payer system actually increases life expectancy and lowers infant mortality rates. There is absolutely no proof for this assertion.

  43. Jack,
    You probably missed this discussion from nine days or so ago, but, to repeat, there is a tremendous difference among countries in how they define a live birth for the purpose of calculating infant mortality stats as illustrated here. The net effect is to make the U.S. numbers look worse vs other countries than they would look if the definition of a live birth were consistent everywhere.
    Within the U.S., infant mortality stats vary considerably from state to state with little apparent correlation to either the percentage of the population that is uninsured or the percentage of pregnant women who received prenatal care as outlined in the latest issue of America’s Health Rankings. The factor that appears to be most correlated to higher infant mortality is poverty.
    The full report is here.

  44. The life expectancy and infant mortality data is widely known and rarely disputed. That it is likely because they don’t have 15% of their population uncovered, which also means their pregnant women are getting prenatal care, could be considered speculation but with pretty solid foundation. We have 18,000 premature deaths per year because they are uncovered by insurance. I’ll leave that math to you.

  45. Jack,
    I read your article. Are you sure that you wish to stand behind statements like this:
    “Their [Canadians] life expectancy is two years longer and infant mortality 35 percent less than ours — mostly because everybody is insured under a single-payer plan.”
    How do you know this? Did you just pull this out of the air?

  46. The Flip-Flopinator is looking at reality, Bush still thinks God is on his side. I still don’t think these plans will contain costs, only bring in a whole new bunch of payers. It’s a good time to be a provider.

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