OP-ED

Op-Ed: Health Care Re-invention and Personal Responsibility More Critical to Reform than Government Intervention

Stephen Kardos

President Obama should be commended for addressing the challenge that’s facing our nation’s health care system. While Democrats and Republicans agree that the health system is broken (since 1975, per person annual health spending has grown 2.1 percent faster than overall economic growth per person¹), there is no clear agreement on the next steps that need to be taken to fix the problem.

President Obama has offered the idea of implementing a national health care plan; however, in its current iteration, his plan doesn’t address what’s broken with the system. Instead of flooding the system with 46 million more insured persons and spending $1.2 trillion over the decade, Obama should look to the hard evidence that indicates a third of all health dollars currently spent each year (more than $750 billion) are wasted. That lump sum should be brought back into the system to care for the uninsured and reduce the national deficit at the same time.

To reclaim those lost dollars, we need to evaluate the emerging value-based health care space.

For background, value-based health care plans have three components:

  1. A special plan design that rewards high quality care by patients and their physicians
  2. A system for information exchange such as an interactive personal health record that highlights exactly for each person (and their physician) what their recommended care actions are and what is missing! and
  3. Decreased premium for patients and better payment for physicians and hospitals.

For physicians and patients who participate in value-based health plans, each person must comply with CDC guidelines for disease prevention and management. For example, diabetic patients not only need care for diabetes, but also for early cancer identification and immunizations to prevent infectious diseases. Each individual and their physicians have online access to a personal health record that enumerates gaps in compliance with care. Using this tool – which is available today – patients essentially have a to-do list that helps them close the gap.

For the example above to work, we must recognize that health, like democracy, requires active participation of all our country’s citizens. Our government does not work when we fail to vote. Likewise, our health system cannot work if we fail to actively participate in taking care of ourselves.

And while legislation is one important way to change behavior – e.g., the motorcycle helmet and “Click it or Ticket” laws are two successful examples –we must also educate and incent payers and payees into participating voluntarily. We need both carrots and sticks for success.

The paradox is that in value-based plans, people see their doctor more frequently while overall medical expense decreases (and overall health increases). With this ounce of prevention, individuals can be made aware of potential medical problems before they become life-threatening. Imagine if your doctor said, “At the rate your blood sugar is rising, you will more than likely contract full-blown diabetes in the next year.”

As such, part of any value-based reform campaign must involve education that reminds people how many Americans (with or without insurance) face bankruptcy because of preventable health catastrophes. In short, we must put in real terms how much money Americans will save by staying healthy using value-based plans.

Like “click it or ticket,” just by following the rules of the road for health and using available technology, each person and their physician can recover one-third of a trillion dollars a year for America starting today. That’s reform we can believe in.

—————

1) Council of Economic Adviser’s Executive Summary, “The Economic Case for Health Care Reform,” June 2009.  http://www.whitehouse.gov/assets/documents/CEA_Health_Care_Report.pdf

Dr. Kardos is the former Chief Medical Officer for Horizon Blue Cross and recent past Chairman of the Board of AT Still University. He founded Triveris 18 years ago to reduce health costs by improving medical care quality using information exchange and low cost available technology. He is a fellow of the American Academy of Pediatrics.

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21 replies »

  1. What is this a love-in for healthcare reform that has no chance of reform. So let’s just take a look at just a few items – 1. America’s healthcare costs are skyrocketing because a. malpractice insurance 2. attorneys and their suing habits c. we pay for the high costs of drug and medical device research costs which is considered “commoditized” by the time it reaches the international community – so quit lying to Americans

  2. What is this a love-in for healthcare reform that has no chance of reform. So let’s just take a look at just a few items – 1. America’s healthcare costs are skyrocketing because a. malpractice insurance 2. attorneys and their suing habits c. we pay for the high costs of drug and medical device research costs which is considered “commoditized” by the time it reaches the international community – so quit lying to Americans

  3. I agree that to take the extra and unnecessary cost out of the system we need a complete payment reform. The current system does not reward either the physician or the patient to do the right thing. Today we widely agree that a value based health plan should provide incentive to the patient for adopting healthy behaviors but we equally need to reward the physician for providing the appropriate level of care according to evidence based guidelines. Obviously any intelligent tools that guide the physician and patient according to those evidence based guidelines and identify gaps in care will be beneficial. Thanks Dr. Kardos for speaking your mind and putting this issue in the front and center of the great healthcare debate today.

  4. We have a tendency in America to argue for or against a concept based on our own personal philosophy or view of the world, what advances our personal interests, or the interests of our party, family, organization, or region. Perhaps viewing the issue from a management or systemic perspective might result in innovative approaches to the issue. The American national mindset, citizen philosophy, lack of citizen motivation to be proactively healthy, and governance model make the socialization of health care in America very problematic, particularly at this point in time. A country needs to know its limitations.

  5. Thanks Dr Kardos
    I believe that we must apply the same boldness and creativity to health care as we are to the energy and environmental crises.
    We need to challenge our fundamental assumptions under which we have been operating.
    Nothing less will carry the day.
    But a $2.5 trillin dollar culturally embedded scam is really hard to change
    Dr. Rick Lippin
    Southampton,Pa
    http://medicalcrises.blogspot.com

  6. Tort reform first. Only then can primary care have the cover to tell patients “no”. This is one of the only two ways to cut system costs. The other way is to make the patient pay for “nice but not necessary” care. People always want care that they do not pay for. When we opened our urgent care in 1998 we would have the patient pay for the entire visit and then collect from their insurance company. At the time it was a business model that was not flying. After a year we started billing insurance and we are, of course, doing better. Patients do not want to front costs because they have been conditioned to not have to do it.
    Empower the primary care doc to say “no” to unnecesary MRI’s and CT scans. Allow the nursing home doc to tell a family that a PEG tube is inappropriate. Tell the cocaine addict on disability he no longer gets dialysis if he doesn’t take care of himself. In this country people have a right to life, but not a guarantee, and certainly not a blank check. Tort reform!

  7. This is all true in theory. People should take better care of themselves and they should be encouraged to do so. Encouraged is different than forced. Reality being what it is, some people will not. Just like some people will not vote, but democracy does not collapse on account of that. We cannot build a theoretical system based on the assumption that everybody will be “compliant”.
    I do agree with the notion that primary care physicians are key in any health care reform. The problem is that as long as the reimbursement system is not tilted in favor of primary care, the conflict between “doing the right thing” and making a decent living is not a fair one. After all, as some commented above, if the doctor makes the value based choices, the savings realized will not be returned to the tax payer. They will go to the insurer’s share holders in some shape of form. So what is the incentive to not order that DEXA?
    I also don’t think that fee-for-service is a bad model. The reason it is encouraging waste is that the fees are not well correlated to the importance of the service. Paying fortunes for unnecessary procedures and pennies for cognitive services is the root of most evil, other than allowing parasitic corporations to extract profits from the system without providing any real value to health care (e.g. commercial payers).
    Finally, if we have a broken, inefficient system, and we do, it stands to reason that we will have to first invest in fixing it and only after it has been fixed will we be able to realize the benefits of efficiency.
    There is an upfront cost to this reform and we need to be prepared to foot the bill.

  8. “it’s very important for people to realize that some physicians are critical to improvement.”
    Prof. Victor Fuchs wrote years ago in one of his books that the physician (mainly the primary care physician) is the key figure in all matters related to healthcare including cost control, because they are at the key decision-point on treatment and have the authority and knowledge to make make final decisions on behalf of a patient (and with the patient). No question that were primary care physicians more or less united on basic principles and role that they could see to both improvement in care and in dramatic reduction in costs.
    Why are they not?

  9. Sun Healthcare’s former Sunbridge skilled nursing facility in Newport Beach, Calif, caused my mother months of great suffering which eventually killed her one year after they refused to repair / replace known broken equipment while under a Calif state injunction for having killed patients in Burlingame, Calif years earlier. I have written documents proving top management knew one year before that their equipment was inoperable yet they did nothing to respond to a critical situation which was a blatant disregard for human life otherwise known as wilful misconduct by CEO’s leaders. This made me eligible for treble damages (triple the damages). And the reason SUN can’t sue me, Deborah Calvert, for telling this truth is I didn’t sign a confidentialty agreement upon settlement in mediation where my attorney threatened me with bodily harm by SUN’s CEO. I was forced, intimidated and coerced into signing an agreement based on a fraud charge only. My attorney left out wrongful death, elder abuse, pain & suffering, intentional infliction of emotional damages, etc…. I sued Daniel Leipold for this malpractice and won –he sadly died 2 weeks later. Do you really think an attorney could forget to include such damages when written evidence was provided him -a real slam dunk of a case. Could he have been working for Sun Heatlhcare? This is all about money, have no doubt. This is not rocket science as Buzz Aldrin would say. SUN also cheated the taxpayers of the State of Calif for millions of dollars in fines the DOJ would have fined for the five deaths they were responsible for that I witnessed, had they done their job properly.
    The Dept of Justice turned a blind eye. The Dept of Health didn’t fine the usual $100,000 for her death. Yet SUN’s own medical director, Dr Stoney, wrote an opinion SUN killed her and he’d quit due to SUN’s management’s disregard to his pleas and other families’ pleas for help.
    SUN produced profits at the cost of elder abuse and manslaughter. Shareholders should be ashamed.
    *Note: A $2.5 Million fine in Sept 2005 did not include this specific Sunbridge’s violations, according to Claude Vanderwold, the man in charge of holding Sun Healthcare liable for these damages for the State of California.
    You’ve got to ask yourself: How can SUN have avoided so many fines and damages?
    PS I have a copy of the medical review Dr Stoney signed in 2006 stating in his opinion SUN killed her. I’m not setting myself up to be sued by SUN.

  10. Here’s some wasted monies we should be able to recover from the nursing homes like Sun Heatlhcare Group Inc.:
    Potentially inappropriate nursing home payments spur increased Medicare Part A, Part D oversight
    June 08, 2009
    Tens of millions of dollars were likely inappropriately paid to skilled nursing facilities through the Medicare Part D prescription drug program in 2006, according to a recently released report from the Department of Health and Human Services Office of the Inspector General.
    According to the OIG report, Part D spent roughly $41 million that year to pay for drugs for nursing home residents who should have been covered under the Medicare Part A benefit. While admitting that a small number of facilities constituted the vast majority of inappropriate payments-30 long-term care pharmacies were responsible for 18% of the payments-investigators say that nearly every SNF and half of all pharmacies have at least one Part A patient inappropriately receiving Part D subsidized prescriptions.
    In response to the oversight, the OIG made a series of recommendations to the Centers for Medicare & Medicaid Services, which include more oversight and guidance for skilled nursing facilities. Specifically, OIG told CMS to implement retrospective reviews to prevent future inappropriate payments, and to further educate facilities, pharmacies and drug plans about which Medicare plan is responsible for which medication repayment.

  11. The end of the fee for service payment model will be a sad day because it will be another symbol of how greed and ignorance won again. In a perfect world, the FFS model would be clearly superior because more work should mean more pay if the physician is pure-intentioned and the patient is compliant and empowered in his/her role.
    Unfortunately, I think we all know that our society is a little less than perfect. Sadly, we will address the problem with payment reform but never address the greed and ignorance problems. I thought for a second this was deja vu, then I remembered our financial services sector and the outstanding solutions that we had to deal with those problems.

  12. To add to Dr. Esslinger’s point, that $750 million isn’t actually waste, that is money in someone’s (i.e., doctor or hospital) pocket. Reallocating that money to preventive care is the right thing to do, but you can bet you will be hearing plenty of anguished screams from specialists and hospitals about that. They aren’t going down without a fight.

  13. Agree fully that not much being discussed right now on healthcare reform really addresses the need to change benefit structures and physician/hospital payment incentives so we can have every part of the system pulling in the same direction. The patient centered medical home, as in Sherry Reynold’s link, could be a key foundation to build upon, if only we could get away from the tyranny of fee-for-service. I hold out hope that the “public option”, which theoretically would have the freedom to build in a new payment and benefits methodology, would take advantage and harness these ideas.

  14. I want to commend Dr. Kardos for speaking up and saying such reasonable things about how health care costs can be brought under control. So many days I ask myself “where are my colleague physicians in this debate, and why aren’t they more vocal about how we can make a difference?” At a time when physicians are increasingly taking the blame for the excesses of the health care system (and believe me, I know about this — I practiced medicine in McAllen, TX from 1980-90) it’s very important for people to realize that some physicians are critical to improvement.
    Regards, DCK

  15. The real challenge lies in the transition period since most studies show that costs will go up if you add in preventive care without transforming the payment process at the same time. Other countries with lower costs for example also have providers who are paid far less and have healthier people but that isn’t not because they make people go bankrupt or carry a higher financial risk. In fact just the opposite is true.
    In France for example (where health care is financed by employers, govt and individuals) if you have one of 30 major chronic conditions you have no co-pays or out of pocket costs. Health care is largely immune to traditional market pressures but I can understand why about 40% of the US population might resort to that view. We are watching the election being replayed on the back of healthcare but there is a third solution other then blaming patients or a federal solution.
    It is also an often repeated meme to assume that if people would lose weight and stop smoking we would have enough to pay for our health care. The diet industry is a multi-billlion dollar sickness feeder and we still subdize growing corn (over 1/3 of us crop land) which ends up as high fructorse corn oil in our foods so we need a more balanced and systemic approach that takes a broader public policy view combined with simple local solutions.
    I for example now get my primary care for a flat fee of $45 a month with unlimited access to my provider, basic labs, etc and they have a fully operation EMR that lets me send emails, see my labs, visit summary s (not clinical notes yet though) and each visit can last up to an hour.
    http://www.swedish.org/body.cfm?id=2907&oTopID=1050

  16. Dr. Kardos his hit some of the key points. But he did not emphasize enough the need for payment reform. Nothing gets the attention of physicians and hospitals more than financial incentives. The current fee-for-service system that is so prevalent motivates providers to do more of what we don’t want (more unnecessary surgeries, x-rays, and tests) and less of what we do want (more counseling, objective information, preventive health). Until this fundamental payment issue is addressed, I don’t think there will be much savings to pay for the desired universal access to care that most people agree should be available.

  17. Since you have been doing this for many years, where is your outcome data? Without doubt, hospital avoidance and wise end of life care will save billions $, but for who? The insurance carriers and their CEOs will suck up any savings. Have you ever heard of a health insuranc company lowereing its rates without telling patients that they must have drive by deliveries?

  18. Excellent premise, I totally agree. The use of incentives to establish wellness and ‘health’, rather than treat ‘illness and disease’, could likely contribute more to overall cost savings.
    Individuals ‘demanding’ top-notch health care and access, must be personal responsible for their part. If you choose to smoke, note you will in theory pay more by losing out on incentives etc.. I am not sure how to predict the financial success of such a premise.
    In the end though, with everyone covered, the cost for poor wellness will still need to carried by someone. This will require a radical change in the social norms in the US which is fraught with laziness, obesity, and other damaging behavior.
    Steve

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