On Health Care Reform Stimulating the Economy: The Massachusetts Example

Recently, a somewhat starry-eyed op-ed in the New York Times suggested that a $100 billion annual investment in universal health care is just the medicine that our economy needs. The goal, declared Jonathan Gruber, a professor of economics at the Massachusetts Institute of Technology: “Covering every American.”

It is an appealing proposition. But let me suggest that we cannot blindly invest billions in an already bloated health care system. We need to think through where we want the reform dollars to go. Which sectors of a $2.3 trillion health care economy should we stimulate to insure that patients receive the safest, most effective care at a price that they can afford?

For example, should we try to create more jobs for those making diagnostic scanning equipment?

Probably not. As Health Beat recently reported, we’re already experiencing what some call an “epidemic of diagnostic imaging.” In too many cases, patients don’t benefit. Across the board, 20 to 50 percent of high-tech diagnostic imaging fails to provide information that improves patient diagnosis and treatment. In some cases, false positives lead to unneeded biopsies and surgeries that harm patients. Recent research suggests that an explosion of MRI scans for breast cancer is leading to unnecessary mastectomies. In other words, women lose a breast for no good reason.

So while GE might like more business making diagnostic imaging equipment, all of the medical research suggests that we already have more MRI units than we need, and that they are being overused. (Keep in mind, the goal of health care is not to create jobs: it is to improve the nation’s health.)

But if we simply open the door and tell insurers we’ll provide subsidies for health care for all, we can be sure that a nice chunk of the $100 billion that we invest annually will buy more testing equipment and more tests. Insurers will continue to pay for unnecessary testing because it is popular among many patients (who believe, falsely, that it provides benefits without risks) and some physicians (diagnostic imaging can be very lucrative.)  If insurers say “no” to a popular procedure, they risk losing market share.  If they say “yes” they can pass the cost along in the form of higher premiums, and taxpayers, in turn, will have to find the money to fund higher subsidies.

The problem is this: too many proposals for health care reform focus solely on universal access and run the risk of sending good money after bad. The question we need to ask is: “access to what”?

As Merrill Goozner pointed out earlier this week while “lack of insurance leads to an estimated 22,000 unnecessary deaths each year, medical errors kill nearly 100,000—and most of those people were undoubtedly well insured.”

How can this be? As regular readers know, while uninsured patients are undertreated, in our money-driven health care system well-insured patients (including Medicare patients) often are over-treated. And overtreatment can be dangerous. Unnecessary hospitalizations lead to hospital-acquired infections and medication mix-ups. Unneeded tests lead to false positives (telling you that you have a disease when you don’t), and treatments that can expose patients to risk without benefit.

Patients endure surgery when physical therapy, a change of diet, medication and exercise might have done as much good. In the best-case scenarios, these surgeries lead to pointless stress and wear and tear on the body. In the worst- case scenarios, gruesome surgical site infections, medication mix-ups, and errors in the OR can prove fatal. That’s how misdiagnosis, unnecessary treatments and hospitalizations lead to 100,000 deaths per year—almost five times the number of Americans who die because they don’t have health insurance.

Let me be clear: no one in this country should die because they are uninsured. This is one reason why I, like Gruber, favor an immediate investment in expanding Medicaid and SCHIP, the programs that cover our poorest and youngest citizens.  Premature death is closely tied to poverty. As we’ve discussed on Health Beat, low-income individuals stand the greatest risk of dying prematurely.

Moreover, if the federal government provides additional funding for Medicaid and SCHIP, this will take a burden off the states, which in turn, will leave the states in a better position to fund public works programs that can create jobs.

But when it comes pouring billions into Health Care for All — posthaste — we should do our best to make sure that we are not funding hazardous waste. This means making the structural reforms that will steer patients toward the most effective treatments and reward health care providers who reduce medical errors, avoid unneeded high-risk treatments, and deliver what patients need most.

This will involve adjusting co-pays and reimbursements in ways that will enrage the many in our health care industry who profit most from ineffective, over-priced treatments. They feel entitled to these profits. Gird for a lengthy battle with the lobbyists.

Alternatively, one could leave decisions about co-pays and reimbursements to the insurance companies. But do we really want them making coverage decisions based on what will increase their market share? Or hiking deductibles and co-pays, not to steer patients toward the best care, but to discourage them from seeking any care? In the past, that hasn’t worked out very well.

Will Universal Coverage Create More Nurses?

Gruber cheerfully assumes that if we just invest $100 billion a year in universal coverage, the money will quite naturally flow where it is needed to create “high-paying, rewarding jobs in health services” that will add value to the economy.  “Most reform proposals emphasize primary care” he explains, “much of which can be provided by nurse practitioners, registered nurses and physician’s assistants. These jobs could provide a landing spot for workers who have lost jobs in other sectors of the economy.”

Here, he ignores two realities. First, the guy who loses a job in Detroit—or on Wall Street—is not going to be in a position to become a nurse without a few years of training, if then.  Nursing is a demanding profession that requires a keen intelligence, a cool head, physical stamina, and empathy. Not every former investment banker would make the grade.

Secondly, and more importantly, because the pay for U.S. nurses is relatively low—and working conditions in our chaotic health care system are poor—we have a very hard time filling the nursing positions that we have today.

As I reported not long ago, while the U.S. lays out substantially more for doctors, drugs, devices, and medical procedures than every other developed country in the world, there is one exception to our medical largesse: the “salaries of [U.S.] nurses are roughly equal to salaries in other countries.” In addition, salaries for nursing school professors are often lower than the salaries we pay nurses. As a result, nursing schools have had great difficulty recruiting teachers.

Meanwhile, given the high rate of medical errors in our hectic health care system, nurses find the job exceptionally stressful. “I was just too afraid that I would kill someone,” one former New York City nurse told me.

As Dr. Val points out over at “getbetterhealth.com,” nurses are not lining up to provide primary care services in our health care system  “for the same reasons that physicians aren’t too keen on it: the pay is low, the workload is grueling, and there are other career options that offer better lifestyle and salary benefits.”

So while universal coverage would create greater demand for skilled nurses able and willing to provide primary care, it would not create greater supply. One would think that, given the fact that  Gruber is a board member of the Massachusetts Health Insurance Connector Authority overseeing Massachusetts effort to provide universal coverage he would be aware of the shortage of registered nurses in that state.

As of 2006, federal government estimates show that Massachusetts had 5,000 fewer nurses than it needed.   In 2010 it is projected that 10,000 positions will be empty, and five years after that Massachusetts will be looking for 16,000 nurses.

In other words, health care reform in Massachusetts has not magically conjured up the influx of nurses that Gruber envisions.

The Massachusetts Example

Instead, Massachusetts’ heroic effort has unmasked the primary care shortage that the Commonwealth shares with the rest of the country. Until we reform our delivery system, we can promise everyone access, but we cannot deliver care.

“It is a fundamental truth—which we are learning the hard way in Massachusetts—that comprehensive health care reform cannot work without appropriate access to primary care physicians and providers,” Dr. Bruce Auerbach, the president-elect of the Massachusetts Medical Society, told Congress in February.

Just as an investment in health care for All will not suddenly produce more nurses, it will not magically summon up more medical students eager to go into the very demanding specialties at the lowest end of the physician income ladder: primary care, family medicine, palliative care, geriatric care or pediatric care.

The need to pay off medical school debt, which averages $120,000 at public schools and $160,000 at private schools, is one major reason that graduates gravitate to higher-paying specialties and hospitalist jobs.

Primary care physicians (PCPs) typically fall at the bottom of the medical income scale, with average salaries in the range of $160,000 to $175,000 (compared with $410,000 for orthopedic surgeons and $380,000 for radiologists). According to the New York Times, in rural Massachusetts, where reimbursement rates are relatively low, some physicians are earning as little as $70,000 after 20 years of practice.

But is not just low pay that discourages medical students. As Dr. Christine Cassel, president of the American Board of Internal Medicine, told me in a recent interview:  “Academic medical centers undervalue primary care. They put students [who are trying to learn the art] in the most dysfunctional, least well organized part of the hospital. Residents are down in the basement—with no records, no support’’ seeing the poorest patients.  “This is not how to mentor primary care doctors,” she adds. “The best models are in the large salaried multi-specialty groups—Kaiser Permanente, Henry Ford, Mayo, the Cleveland Clinic. They understand the value of primary care. There, you have a critical mass of doctors; you can share coverage. You don’t have to be on call all of the time; you can go home at 6 o’clock.”

Reformers who talk of universal coverage that promotes preventive care should ask themselves: who, exactly, is going to provide this care? Before imagining an ideal system of chronic care management, call Boston and try making an appointment with a primary care doctor. As I have reported on Health Beat, even physicians cannot get an appointment with a family care doc in that city.  Mass General, for example, is no longer taking new primary care patients.

Dr. Patricia A. Sereno, Massachusetts president of the American Academy of Family Physicians, reports that patients who want to schedule an exam with her office must wait three months for an appointment.

The New York Times reports that the share of internists in Massachusetts who accept new patients has dropped to barely half of what it was not long ago. State-wide, the average wait by a new patient for an appointment with an internist rose to 52 days in 2007 from 33 days in 2006.

This is not to say that health care reform in Massachusetts has caused the dearth of primary care providers. Boston is hardly alone. Nationwide some 56 million Americans do not have a regular health care provider, even though many of them are insured. The problem: a shortage of family doctors, internists and PCPs.

Before promising coverage that we cannot deliver, we need to address this shortage. To expand the supply primary care providers we should create medical loan forgiveness programs. We also need incentives for academic medical centers to invest in better PCP training programs.  In Massachusetts, legislative leaders have belatedly proposed bills to forgive medical school debt for those willing to practice primary care in underserved areas. This is a step in the right direction—but it will be years before the programs funnel new family doctors into the marketplace.

In the meantime, what will patients do?  In Massachusetts “Thousands of newly insured patients have figured out that the fastest way to see a physician is to go to the Emergency Room,” notes Dr. Stanley Feld over at “Repairing the Health Care System.”

“Citizens in Massachusetts are going to the emergency room at a 40% higher rate than the national average at a 20% higher rate than before the present universal health care system.”

This of course, only hikes the total cost of health care, pushing insurance premiums heavenward. The average charge for treating a non-emergency illness in the ER is $976, according to the state Division of Health Care Finance and Policy. By contrast it costs between $84 and $164 to treat a typical ailment such as strep throat in a primary care doctor’s office, according to Blue Cross Blue Shield of Massachusetts, the state’s largest private insurer.

The Rising Cost of Care Under the Massachusetts Plan

Since the Massachusetts reform became law in 2006, 439,000 people have gained coverage.  The update issued by the state last month reveals that the share of state residents who are “going naked” has dropped from a high of 7.4 percent in 2004 to 5.7 percent in 2007. This is only a slight improvement on 2000, when 5.9 percent lacked insurance. Nevertheless, on the face of it, this is an impressive achievement in just three years.


But, as “the Center for Health System Change (CHSC) pointed out in a brief on Massachusetts reform just two months ago, “Little has been done to address escalating health care costs. Yet, both [coverage and costs] must be addressed, otherwise the long-term viability of Massachusetts’ coverage initiative is questionable.”

This helps explain why Massachusetts version of “universal coverage” isn’t quite universal.  Last year Massachusetts “exempted” 62,000 of the state’s citizens from the mandate that everyone buy insurance on the grounds that these families could not  afford the state’s climbing insurance premiums—premiums that are trying to keep up with those ER bills, not to mention a diagnostic imaging industry that continues to grow.  The exemptions are based on affordability schedules established by the state

Too poor to afford the insurance, but not poor enough to be eligible for subsidies, these families remain locked out of the system.

Because health care remains so pricey, Massachusetts has not been able help many a struggling middle class family. An editorial on Boston.com offers this example:  “A couple in their late 50s faces a minimum premium of $8,638 annually, for a policy with no drug coverage at all and a $2,000 deductible per person before insurance even kicks in. Such skimpy yet costly coverage is, in many cases, worse than no coverage at all. Illness will still bring crippling medical bills—but the $8,638 annual premium will empty their bank accounts even before the bills start arriving.

The editorial notes that, according to the Census Bureau “only 28 percent of Massachusetts uninsured have incomes low enough to qualify for free coverage. Thirty-four percent more can get partial subsidies—but the premiums and co-payments remain a barrier for many in this near-poor group…And 244,000 of Massachusetts uninsured get zero assistance—just a stiff fine if they don’t buy coverage.”

Employers, too, are squeezed by the rising cost of care. The CHSC brief notes: “Massachusetts employers continue to experience large premium increases, which for some small employers are reportedly in the double digits. Respondents largely attributed rising premiums to the escalating costs of Massachusetts characteristically expensive health care system. Many expressed concern that unless the state seriously addresses the underlying factors driving costs, the current trajectory of the reform is financially unsustainable.”

Many of Massachusetts’ Insured Cannot Afford to Use the Insurance

With deductibles that run as high as $2,000, plus 20 percent co-pays  that can bring an individual’s out-of-pocket expenses to $5,000 a year, the state acknowledges that many of the newly insured cannot afford to use their insurance. The chart below comes from  last month’s update:


The share of insured patients who didn’t go for treatment because “cost was an obstacle” has risen since the Massachusetts law was passed in 2006. This illustrates what those who focus on “Healthcare for All Now” fail to understand:  Universal Coverage does not equal Universal Access to Care.  If 37 percent of insured families cannot afford to the deductible and co-pays, what good is the insurance?

What Went Wrong?

The problem, says Dr. Feld, is that the Massachusetts health care plan was not thought out. This is what happens when reformers focus on covering everyone now—without thinking about how to contain costs while delivering more effective care.

We cannot blithely assume that increasing the demand for primary care will boost supply. That doesn’t mean we have to wait years for more primary care docs to emerge from medical schools. Some thoughtful investments could provide solutions: more community health centers, particularly in inner cities, would alleviate overcrowding in ERs. We could pay doctors to communicate with patients who have only a minor problem by e-mail or by phone, increasing the number of patients that they can see quickly. And if we provided financial incentives for PCPs to hire nurse practitioners, pay them well, and improve their working conditions, we could bring some nurses back from retirement, expanding primary care coverage.

But if want affordable care, when we invest more in one part of the system, we have to save somewhere else. This means facing down lobbyists, and cutting the very high fees for certain services that some specialists provide—especially when these services are only marginally effective.

In his New York Times op-ed, Gruber claims that we just don’t know how to rein in health care spending.  “Experts have yet to figure out how to restrain cost increases without sacrificing the quality of care that Americans demand.” This simply is not true.

Rather, “Experts have yet to figure out how to restrain cost increases” without sacrificing the amount of over-treatment that well-insured Americans have been persuaded that they need.

But as both the mainstream press and the blogosphere focuses on excesses in our health care system in the form of an “epidemic” of diagnostic imaging; angioplasties that expose patients to risks without benefits, and over-priced not fully tested drugs and devices that have to be withdrawn from the market (after killing many patients), Americans are beginning to understand that more care is not necessarily better care. We need a health care system that delivers the right care to the right patient at the right time.”

Who decides what is the right care? Medical evidence should be our guide. As Peter Orszag’s Congressional Budget Office (CBO) pointed out in December of 2007, we know where much of the waste is. We already have comparative effectiveness research on a wide range of treatments, pitting angioplasties against drug regimens for heart patients, for example, and gauging the effectiveness of surgery for patients with emphysema.

Moreover, CBO notes, the Cochrane Collaboration—an international nonprofit organization that has a network of volunteers who conduct unbiased systematic reviews of treatments—maintains an accessible database that now contains more than 4,500 reviews.  We currently have legislation in Congress poised to create a Comparative Effectiveness Institute that could draw upon Cochrane’s findings, adapting them to our priorities and issuing guidelines (not rules) for best practice.

Admittedly, we will have to make some tough decisions: How far do we go in regulating insurers to insist that they cover the most effective care? Should we insist on “community rating”—which means that insurers cannot charge older or sicker patients higher premiums? (So far insurers are adamantly opposed to this idea. But the fact that, in Massachusetts, older patients pay significantly more is one reason why some are “exempted” from coverage, at just the time in life when they need it most. )

Should health care reform mean paying more to health care providers who follow guidelines?  Consider, for example, the National Cancer Institute’s recommendation that the risks of mammograms outweigh the benefits for average-risk women over 70.  Should we reimburse the health care provider for the time it takes to explain to an elderly woman why she may not want a mammogram?  Should we require that women over 70 who, nevertheless, insist, pay more out-of-pocket? These are questions we need to address before handing insurers a blank check to cover all Americans.

Keep in mind: insurers are not going to try to excise waste from the system if it means losing market share.  Few insurers discourage mammograms because the treatments are popular. If they did, customers and employers might switch to a different insurer.

We don’t have to make thousands of separate decisions about individual treatments before embarking on universal coverage. But we do need structural reforms that will begin to squeeze the waste out of the system. We should put systems in place that begin to address questions about coverage and reimbursement based on how much a treatment benefits the patient. Can we “think through” those structural reforms, and win the inevitable battles with the lobbyists who will oppose any form of cost-containment in the next 120 days?

No. But before rushing blindly forward, we should remember Massachusetts. Despite the best of intentions, the Commonwealth’s reform shows that “universal coverage” does not mean “universal access” to sustainable, affordable care. In Massachusetts,

  • Co-pays and deductibles are so high that the share of insured citizens who cannot afford to use their insurance has climbed since reform began.
  • The number  of uninsured has dropped from its high—but the share of Massachusetts citizens who lack insurance remains over 5.5 percent—roughly  where it was eight years ago, in part because the state doesn’t have enough money to provide subsidies for everyone who, the state agrees, simply  cannot afford the premiums. These citizens are left out in the cold: “exempted” from universal coverage.
  • Meanwhile both the state and its employers are going broke trying to keep up the cost of covering the rest of the population.

And Massachusetts is a wealthy state. Imagine if we had Massachusetts-style healthcare reform nationwide. Do you really think this would help the economy?

Maggie Mahar is an award winning journalist and author. A frequent contributor to THCB, her work has appeared in the New York Times, Barron’s and Institutional Investor. She is the author of  “Money-Driven Medicine: The Real Reason Why Healthcare Costs So Much,” an examination of the economic forces driving the health care system. A fellow at the Century Foundation, Maggie is also the author the increasingly influential HealthBeat blog, one of our favorite health care reads, where this piece first appeared.

11 replies »

  1. The article is beyond doubt is valuable specially in making the badly informed urban populace responsive to the dismay of addiction. It is proven that drugs arousal requires rehab facility and after you receive your drug abused son returns from northern california drug rehab you will also promote the same.

  2. Midwest FP, Jamesd, tcoyote, rbar, MA resident, jd, ema
    Thanks for your comments.
    Midwest FP–
    Thank you.
    You write “since I have started to tell the patient the true risk of each test and even hospitalizations, most opt out of the more extensive evaluation/treatment. I simply document the heck out of their informed refusal. For some reason though, the system easily pays for the test, but pays me next to nothing for taking the time to obtain that informed consent for a test they don’t really want and the system can’t afford after the parasitical private third party payers take their share.”
    Exactly. We need to pay health care providers to take the time to talk about the pros and cons of a treatment or test. Research shows that at least 20 percent of patients will decide against it-if they have the information to make an “informed choice”–not just passively give “informed consent.”
    On fear of malpractice suits, that certainly can be a factor in overtreatment. But it’s very difficult to quantify. The fact that we pay fee for service, that we pay for “doing things” (rather than talking to patients) and the fact that many doctors also believe that “more is better” that the “most advanced, most expensive technology is best” is all tangled up with fear of malpractice suits when they decide to do more . . .
    The August HealthBeat Report was based on numbers that the state relased in August. My recent report was based on numbers released in October when the Boston Globe made a special request and the state released new figures. Apparentlly things have gotten worse (or the state wasn’t admitting how bad things are in August.). . .Both posts emphasized that Mass healthcare reform was prooving to be very expensive and that costs are out of control.
    You write a “20% increase in ER visits in a state with the most primary care physicians per cap. in the US, who would have guessed?”
    First, Mass does not have more PCP’s per capita.
    It has more physicians of all types pre capita (a great many specialists.) It does have more PCP’s per capita than than the Average State. But many of Mass PCPs are
    female physicians who work only part-time or shorter hours. Many others are hospitalists –PCPs working in Mass many large hospitals. Finally, many PCPs are not taking new patietns–and some are scaling down their practice as they think about retiring. (See link to NYT on these points)
    On the nursing shortage– see this fact sheet.http://www.aacn.nche.edu/Media/FactSheets/NursingShortage.htm dozens of sources documenting the shortage.
    On healthcare in other countries: No system is perfect (the UK’s system is underfunded) but overall, outcomes are better and, on average, they spend half as much as we do. When I went to an int’l medical conference in Germany last spring, I was impressed by many things–including the fact that, of several thousdand participants, Uwe Reinhardt (Princeton health economist) and I were the only Americans.
    Americans know very little about healthcare in other countires. Sweden, Germany, France all have excellent systems. Both patients and doctors who have visited here are appalled by the laissez faire chaos, expense and poor treatment of patients in our system.
    Finally I don’t know what an “American solution” means. Is this like an “American solution” to problems in the Middle East? Or an “American solution” to Global Warming? Or perhaps our “American solution” to poverty? (A much higher rate of poverty than any country in Western Europe, mainly concentrated among children.)
    I think it might be time to try to learn something from other countries.
    High deductibles cause people to put off needed care. (And for a middle-class family earning,$45,000 before taxes, a $2,000 deductible is a lot of money.)
    High co-pays for treatments that we know are not effective (PSA tests, for example) make sense–and steer people away from unnecessary treatments. High deductibles steer people away from both necessary and unnecessary treatment.
    On the percent uninsured and the number covered–the numbers are correct. Go to the link to see the Massachusetts update and all of the charts.
    On how we have a $100 biillion imaging industry if Medicare spends $14 billion on imaging. Medicare pays only for imaging Tests; the value of the total industry includes both the tests and the cost of the testing equipment that we purchase from companies like GE.
    MA resident– thanks for a report from within. Costs do
    keep rising — and the fact that the state has had to “exempt” people from coverage makes it clear that care is too expensive.
    rbar- good to hear from you.
    On preventable deaths, it all depends on how is reviewing the literature and what they count as “preventable” when they read the medical record.
    That said , this is the best summary I have found of
    the problem:
    ” However, resolving this specific issue may not be especially important for the other three studies as Example B also shows a more fundamental problem in past research on this topic–how using a majority rules criterion and a dichotomized outcome (“preventable” versus “not preventable”) can be misleading regardless of the statistics used. After all, counting almost all cases as “not preventable” simply because few cases meet the majority rules criterion would obscure the fact that for many cases there is substantial disagreement about whether the deaths are “preventable” and we cannot determine who is correct.
    “Accordingly, we believe that a more appropriate summary of the preventable deaths literature is that implicit review finds very few clear-cut “preventable deaths” in which a majority of reviewers would rate the case as “preventable,” but there are many deaths in which a substantial proportion of reviewers would rate the death as “preventable” (Hayward and Hofer 2001). Those who believe that preventable hospital deaths are common can therefore argue that many errors may not be evident from the medical record and that the physician reviewers may be reluctant to criticize fellow physicians (Leape 2000). Alternatively, those who believe that few hospital deaths are preventable can counter that there is no clear evidence suggesting that preventable deaths cannot be detected from the medical record (Brennan et al. 1990) and that the outlier opinions (those who rate the deaths as preventable) are simply second-guessing reasonable care using hindsight (McDonald et al. 2000). We thus recommend that the health policy and health services research communities acknowledge that there is not strong epidemiological evidence to support either position and that we should keep an open mind while awaiting more rigorous evidence on this topic (Hayward and Hofer 2001). (This is from BNET, Aug 2007 http://findarticles.com/p/articles/mi_m4149/is_4_42/ai_n27331526/pg_5?tag=artBody;col1
    And this seems to refer only to deaths in the hospital. A great many people die because they were misdiagnosed–or over-diagnosed. Drugs also kill some patients.
    Finally, many iatrogenic deaths (deaths caused, inadvertently, by medical care) are covered up by hospitals, nurses, doctors who are afriad of lawsuits.
    Device-makers and drug-makers also cover up deaths, offering families a settlement even before they have thought about suing.
    Finally, we know that the number of medical errors that cause injury or death is higher in the U.S. than in other developed countries.
    Rbar– On Europe, you’re right. Though I would add that some countries are not even up to their ankles. Sweden is doing very well. It has managed to keep healthcare spending as a %age of GDP stable for many years, even though it’s population is significantly older than populations in other countries, and aging rapidly. Patient and doctor satisfaction is generally high and outcomes are good. Their one problem is long-term care for the aged–they are trying to improve that.
    In general, the rising cost of medical tehnology is a problem everywhere, but European countires have done a much better job of handling it. And the quality of care there is generally so much better. My step-daughter in law just had a baby in Germany. Everything was paid for, the doctors and midwives were excellent, and when the baby had a problem (water in its lung) that kept it in the hospital for an extra 8 days, they told the mother she could stay too and set up a room for her close to the baby. (In the U.S. they would have put the baby in a dangerous post-natal ICU and sent the mother home, depressed that she couldnt’ bond with her baby.) And neither the mother nor the father are German, though they’ve lived there a long time.
    ema— I completely agree — thinking in terms of “me” rather than “we” is at the bottom of much that is wrong with our system.
    Everyone is part of the problem– patients who want instant gratification, as well as the many in the health care industry who overcharge, make a profit on
    overtreatment, and shun the needy.
    To reform the system, there will have to be tradeoffs. All of the players (including many patients) will have to give something up.
    We cannot have affordable care and expect attention 24/7 (except in an emergency); elective surgery at the drop of a hat (no questions asked as to whether you need it, no waiting time to figure that out); angioplasty rather than exercise and a change of diet–(which “takes too long”) back surgery instead of physical therapy; etc. etc.
    jd– It is essential to change the culture of health care–this means that the public, as well as some doctors need to learn that more care is not always better care. They will learn that as changes in reimbursements and co-pays steer them toward more effective, often more conservative treatment–and they find that outcomes are as good–often better–with less suffering. And, less expensive.
    The system needs structural reform because in health care, lower cost goes hand in hand with more effective care. (Medicare spends 50% less when a patient is cared for at the Mayo Clinic than if a very similar patient receives care at UCLA Medical Center where he will see many more specialists, undergo more procedures and tests and spend more days in the hospital. Outcomes, patient satisfaction and doctor satisfaction are higher at Mayo.
    Why will this happen now? Because Medicare is going broke. Everyone in Washington realizes this. The Bush administration simply ignored this–as it ignored Fannie Mae. But Congress and the new administration realize that if they let Medicare implode they have an enormous problem. Deficit spending won’t solve it. Deficit spending will simply cause more foreigners to lose faith in the dollar, and more and more of them will stop buying our Treasuries unless we raise interest rates. Higher rates will mean inflation–just what we need in a recession/depression.
    Medicare’s Hospital Trust Fund began spendign more than it takes in in taxes a few years ago. Medicare co-pays and deductibles are already too high for many retirees.
    And retirees now have significantly less savings than they had 6 months ago.
    Unless Medicare does something in 2009, the law says that it must cut all physicians’ fees–across the board, by 10% in January of 2010. Many physicians don’t take Medicare patients now. If that happens many more will refuse Medicare patients. That will be the beginning of othe collapse of Medicare.
    On standing up to the lobbyists: last July Congress showed that it is beginning to develop a backbone. Medicare was scheduled to cut physicians’ fees across the board (as it is supposed to do in Jan 2010). Progressives offered legilslation that would cut the bonus Medicare gives private insurers who offer Medicare advantage instead of cutting doctors’ fees.
    The AARP and the elderly backed this legislation. Congress looked at private insurers on one side of the
    room, and the AARP and the elderly on the other side of hte room, and they knew who to be afraid of. They voted against the insurers.
    This will happen again in 2010 when they have to decide between saving Medicare and appeasing the drugmakers, the device-makers, the diagnostic imaging industry and the highest paid specialists who don’t want their fees trimmed.
    This is why well-informed people in Washington believe we will have Medicare reform in 2009 that cuts fees for some services while raising fees or primary and cognitive care, and that begings using the comparative effectiveness reserach institute’s date to decide co-pays and fees as well as how much it is willing to pay for drugs.
    Obama’s health care plan, like Baucus’ plan calls for these reforms–and Peter Orszag, former CBO director who will now be OMB director understand that we must begin by making the structural reforms that will strengthen the system–raising the quality of care, and making it safer while also cutting spending.
    Think of it this way: if you had a fleet of defective planes and knew that, every month, 20 out of 1,000 would crash, taking passengers down with them, would you invest money in making more of those planes? Or would you first make changes in the design of the planes?

  3. Greed and knee jerk reactions are our current health care system engine. Everyone wants to get rich, from the insurance companies, hospitals, CEO’s, Doctors and patients too, just to name a few players for health care dollars.
    One insurance company I dealt with changed it billing address but did not tell anyone. It then denied claim after claim as not being submitted to the correct address. I think it was to avoid paying, they denied it, then never returned my phone calls after that…raising premiums did not buy better customer service. Greed.
    A hospital CEO with a salary that equals 14 years of my pay, spent what equals one year of my hard work pay to redecorate her office, in addition to bonuses and severence packages. You can be sure this cost was passed on to the hospital’s customers.
    How many homes and cars does a surgeon who wears armani suits need? Greed. I know, before anyone gets defensive, most doctors don’t see themselves as having enough money for anything, and because insurance companies and lawyers want all the doctors’ moneys that’s probably true.
    One test not done, one word not documented in a multimillion dollar charting system and the patient will find a lawyer who will sue for amounts of money that are so huge it is shameful. Greed.
    Then there is the “oh my God I need morphine and an MRI for my hangnail, that I have had for 6 weeks, but today is just too much to handle”.
    With a knee jerk response to our own health and the knee for instant gradification, people line up for ER visits for things that I would be ashamed to go to the ER for. A cold, sniffles, gas, hang nail, itchy eyes. They all act like they are the number one priority. I have had people complain because they were forced to wait because of a “code” to save someone life, but because that person died it was a “waste of time for them to wait”. Callous greed.
    One mother brought her child in because her child was “dying”, what had happen was her 6 year old lost a tooth and it bled a little, the mother had found some sort of syndrome that was deadly while on the internet, the sign of said syndrome was losing teeth and bleeding.
    Reform must come in prevention programs and early and continuing education. Starting in preschool and continuiing for life. Handwashing, personal hygiene and some simple food choices. We must stop expecting everyone else to take personal responsibility for our inability to care for ourselves.
    Another concern I have is that we are coming to a point in dollars versus needs that will pit our children against our elderly, and the disabled against the severely disabled. This will not be pretty, kind or fair in any way.
    I am a nurse, I have been in nursing as an LPN and RN for 28 years and have worked many places in many different kinds of nursing. I have been forced to ration care because of poor staffing, not enough money for supplies and because patients did not have insurance. It has been hard to stay in nursing this long.
    Since I have seen both good and bad in the health care system, I can say no one is without blame, therefore reform must be personal, it must be a journey that we all agree to take together. We must all change, not just “the other guy”.

  4. Maggie,
    Scott asked the question that was nagging at me, but your response didn’t really resolve my problem.
    It is becoming the fashionable thing to say among policy wonks that we mustn’t enact universal health care unless we first, or simultaneously, enact deep reforms to the payment system to remove the perverse incentives and misdirected care.
    OK, but how? And I don’t mean how can we do it in principle, but what reason do we have to believe that these reforms can be accomplished in 2009, or at any point in the next 4 years? And how much reform do we need before universal health care is back on the table? Is it enough to get the cost trend to stay in line with the growth in GDP? Or do we have to chip away at the 16% of GDP devoted to healthcare and bring it down to 15% or 12%?
    I would guess that the “system reform first” advocates would aim for the more modest goal of a tamed cost trend, since there isn’t a chance in hell that healthcare’s share of GDP is going down appreciably in the next several years. But if that’s all you want, why hold off on universal health care? Should we wait a year just so that we can confirm our system reforms are working to control cost trend?
    It doesn’t make sense to me, and I don’t think the implications have been thought through by the system reform first crowd. I see no reason to wait.
    Those for whom healthcare expenses count as revenue will fight tooth and nail any reforms that have a real impact on costs. We all know that. I think we also know how strong these lobbies are. It is not enough for you to say, “We know where much of the waste is: we’re just not acting on it due to a lack of political will. Congress and Medicare have not stood up to the lobbyists. In this
    recesssion/depression that may change.”
    A credible reform plan needs to have thought about what can make it change and tip the scale in favor of reform. I’ve argued here and elsewhere that universal healthcare itself can tip the scale. And frankly, I don’t see anything short of universal healthcare providing the impetus to overwhelm the healthcare lobbies.

  5. Thank you all for your comments.
    I’m just responding to Scott here, but will be back ot respond to everyoneelse.
    Scott– Since you asked the shortest question, I’ll answer you first: I’ve written a paper on Medicare Reform which I see as a pilot program for National Health Reform. You’ll find it here http://www.tcf.org/list.asp?type=PB&pubid=657
    At the center of the proposal is a Comparative Effectiveness Institute (legislation already in Congress) that sorts through and reviews all of the unbaised comparative evidence we have (some of it from abroad) about what treatments are most effective for patients who fit a certain profile, and uses it to decide co-pays and how much to pay for certain services.
    The key is that the Institute would be looking at how much services and products Benefit Patients. (Right now we pay for serices based on how much time, stress,
    physical labor, technical skill it COSTS the Doctor to provide the service–BENEFIT to the Patient doesn’t figure anywhere in the calculation.
    But clearly a doctor at a smoking cessation clinic who gets a patient off tobacco should be paid as much as a doctor who provides a cancer drug that extends life, for the average patient, by two months. . . . And the doctor who has the full conversation about the risks and benefits of an elective procedure (probably two conversations) should be paid for his time. At least 20% of patients will decide not to go ahead with the procedure–sparing patients unnecessary suffering and the pain of regret after having back or knee surgery that didn’t do much good, sparing the doctor the possible lawsuit from the patient who had unrealistic expectations as to what the procedure could do, and saving all of us more than enough money to pay the doctor for talking to and listening to the patient.
    High co-pays for less effective services (PSA tests for average-risk men, mammograms for women over 72, MRI
    scans for breast cancer,) and low or no co-pay for effective services (Pap smears, physical therapy for people with knee or hip problems, that smoking cessation clinic etc.) would steer people to more effective care.
    In terms of expanding primary care, we really need more integrated, multispecialty clinics. Their size means that they can afford the electronic medical records that they need–and places like Geisiner, Mayo, the VA and Kaiser actually have EHRS that work. In these large centers there are enough doctors supporting each other that no one should have to work overtime. Primary care is much less stresful for the practioner than it is in a small practices. And since doctors are on salary, though don’t feel they have to rush and see one patient every 10 minutes just to pay their rent & utility bills.
    We also need to do a much better job of integrating nurse practioners into primary care–not just paying them more, but trainng them, side by side, with doctors in some areas so that everyone gets used to the idea of collaborating while still in school.
    We need community health clinics that are open evenings and week-ends so that patients aren’t going to the ER for expensive care when they can’t get an appt. with a doctor.
    Medicare needs to provide financial incentives to persaude academic medical centers to place greater value on primary, geriatric, palliative and pediatric care.
    Medicare should negotiate with drug-makers and device-makers for lower prices. (Insurers would soon begin demanding lower prices as well.) And again, we should pay based on how Effective the drug is. There is really no reason to pay $40,000 for a drug that extends life for the average patient by 2 months. If we pay more for truly useful drugs and less for marginally effective drugs, drug makers will spend more time and money on trying to develop trying useful drugs, and give up on the unaffordable drugs.
    We need to regulate insurers, insisting that they provide coverage to everyone in a given community at the same same price, and that all policies are comprehensive–no more policies filled with holes and tricky exceptions.
    The major problem is that we spend too much on advanced medical technologies for patients who don’t need the high-tech treatment. I wrote about this here http://www.healthbeatblog.org/2008/10/the-truth-about.html and
    here http://www.healthbeatblog.org/2008/11/the-truth-about.html.
    OFten the new drug or procedure is appropiate and effective for patients who meet a cetain profile, but then we start giving it to everyone, exposing patients to unnecessary risk,and the system to unnecessary expense. WE can use financial incentives to curb the waste, but we also need to educate the public so that Americans undersatnd that more care, or more aggressive expensive care is not better care. Sometimes it is worse.
    We know where much of the waste is: we’re just not acting on it due to a lack of political will. Congress and Medicare have not stood up to the lobbyists. In this
    recesssion/depression that may change.

  6. Maggie,
    Excellent article as always. You have identified many of the key points with regards to the multi-dimensional “access” issue as well as the cost.
    However, I did not see any of your recommendations, proposals, or solutions to these problems. Knowing you, I am sure you have a detailed recommended plan somewhere – can you point me to what you are proposing to resolve the current conundrum?

  7. Maggie,
    Thank you for a great post. One comment: I was always skeptical of the “100 000 preventable deaths” in US hospitals claim – and I am not alone:
    It just doesn’t make much sense. If the number was true, one could make the case that medical care is not beneficial at all … (I admit, it may not be AS beneficial as most doctors and patients think it is and I agree that most of our longevity is due to improvements in public health), and no doubt patients are getting harmed in hospitals (and undoubtedly, efforts need to be made to reduce errors) … but the 100 000 claim seems very dubious. We should reexamine this mantra.
    JamesD – “Whatever the plan turns out to be, it must be uniquely American in nature. Europe hasn’t found the solution and neither has anyone else.” I have worked in Europe and in the US, and I follow the discussion both in Europe and in the US. Europe is in the swamp up to the ankles, the US is sunk in up to the neck. The problem of how to deal with rising health care costs will be around as long as there is medico-technical progress. That does not mean that Canada’s and Europe’s health care systems cannot be a model for reform in the US.

  8. jamesd–Many of the newly insured are continuing to use the ER as their primary care source. This is largely due to the fact that there is a shortage of primary care physicians in the state and many docs want nothing to do with the lousy insurance products the Commonwealth has mandated.
    tcoyote–You are absolutely right, the math doesn’t work! The state’s “leaders” and the Connector are trying hard to make this scam look like it is working, but it isn’t. The plan is way over budget and the system can’t handle the expansion of patient flow. In addition, the middle class is getting pounded by steadily increasing premiums and ever higher deductibles and copays. There have been few takers for the Commonwealth Choice plans. I will be fined nearly $1,000 this year for refusing to buy low quality coverage that I can’t afford. The primary beneficiaries of the MA scheme have been the health insurers whose crummy products are mandatory, and some of the state’s larger hosptial systems (Partners, in particular).

  9. Massachusetts Connector outlawed high deductible health plans. So how did we end up with deductibles so high? Are you advocating that the care should be free?
    Also, if Medicare spends only $14 billion on imaging, how did we get a $100 billion imaging industry?
    Finally, if Massachusetts claims to have covered 439 thousand new people w/ their health reform initiative, how do you still end up w/ 5.7% uncovered in a state with 6 million people? Math doesn’t work. Please advise on these three items.
    Agree on core problem: no sacrifice from hospitals in a teaching hospital dominated care system and no focus on supply of primary care providers are critical flaws in Mass. approach.

  10. Maggie,
    On August 25, 2008 in Health Beat’s article “Universal Coverage is no Silver Bullet” Nikko wrote “ This surge in coverage (Mass health care reform) has reduced use of emergency rooms for routine care by 37%”. Now you are quoting a 20% increase in ER visits. Which is it? A 20% increase in ER visits in a state with the most primary care physicians per cap. in the US, who would have guessed? I hope that you are not counting on rapid response teams, preventive care, IT, disease management or “quality” to solve the problem because they won’t. You could have dueling blogs all day long and you would not come up with the answer or a consensus. So please answer just a few questions? What is basic health care? How much money should each individual be required to spend on their health care and how much health care should that buy? How much health care is required? How many Americans are we prepared to lose? Why, if the people in just about every county in America are able to vote an tax themselves to provide their police and fire protection, public schools, transportation and mass transit, but not their own county health care? In most states it is illegal either under state taxation laws or state insurance statutes. It would certainly be good not only solidarity, but also for the principle of subsidiarity to allow people in the 5000 or so counties to have this option. If we can estimate how many people die from all the evil misfortunes perpetrated on the public by the present health care delivery system, why can’t we calculate the number of deaths by various Congressional edicts related to health care? I’ll make it easy, The Balanced Budget Amendment of 1996. By cutting the number of doctors by thousands, especially primary care physicians, there just has to be some death in their some where I just can’t find the number.
    If we are to even begin making headway towards better and more cost efficient health care in America then we must answer some very difficult questions. We may not like the answers. Whatever the plan turns out to be, it must be uniquely American in nature. Europe hasn’t found the solution and neither has anyone else. They are just treading water like the rest of us. The Dutch health care budget was $1.4 billion dollars over budget this year, about 2.3% and they only have a population of 16,000,000 people. So they are cutting $1.4 billion from next year’s budget mostly in long term care. It’s a good bet that next years deficit will be worse than this years. The primary care physicians in the UK just got a wonderful bonus, so they turned around and told the government they would no longer be responsible for the care of their patient’s 24/7. Their physicians’ guild, RCGP, just called for a NATIONAL URGENT CARE SYSTEM to take care of their patients after hours and on weekends.
    Maggie you are right when you say that universal care is not the way to go right now, just not for the right reasons.
    P.S. The Nursing workforce committee of the IOM doesn’t share your assessment of the nursing situation in America at this time. They say that more than 325,000 new nurses have entered the workforce, that the situation has stabilized for now and this happened precisely because wages have gone up so much for nurses… Don’t worry these were the same guys in 1996 that said we had a surplus of physicians.

  11. Bravo
    As one of the few FPs left with an open practice taking Medicare and Medicaid withour restrictions I have always wondered who is going to provide care in a universal access system and what value such access really provides.
    Thanks to the RUC and CMS, I am now in a position to charge what I like to the growing population who values what I can do and can afford to pay for it out of pocket. Unlike many of my collegues, my partners and I have decided against going cash only for now to ensure access for our patients, even though system extingencies impair the quality of care we can provide. On the bright side, their low reimbursement rates generally protects our patients from proceduralists, but the burnout point for us in nigh.
    A supermajority of NPs lack the professional confidence to treat patients with multiple chronic diseases in a cost effective manner. Several in our area have enrolled in medical school so they can better meet the challenges demanded of them. Establishing best practices is fine,but until patient “more is better” attitudes change, it will not signficantly affect primes referring out risk. As long as a trial lawyer can make a millions using emotional appeals to juries even in the presence of professional rebuttal witnesses, and someone else is paying the bills, physicians are going to default toward the ” everything that can be done approach”.
    Interestingly though, since I have started to tell the patient the true risk of each test and even hospitalizations, most opt out of the more extensive evaluation/treatment. I simply document the heck out of their informed refusal. For some reason though, the system easily pays for the test, but pays me next to nothing for taking the time to obtain that informed consent for a test they don’t really want and the system can’t afford after the parasitical private third party payers take their share.
    Without comprehensive reform not only of payment, but also of torts, documentation and training, the least advantaged in our community will pay the heaviest price.