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“I Am Not Bound To Win. But I Am Bound To Be True.”

So many said it would never happen. But now, on Sunday, March 21, 2010, it appears that reformers have the votes. Rep. Bart Stupak, the leader of the anti-abortion hold-outs, has announced that he will vote “yes.” – under the agreement, President Barack Obama will sign an executive order ensuring that no federal funding will go to pay for abortion under the health reform plan. This really doesn’t change anything. Stupak got nothing except face-time on television.

At last, Congress is about to take the first step toward transforming what we euphemistically call our health care “system.” In the years ahead, the laissez-faire chaos that puts profits ahead of people will be regulated, with an eye to providing affordable, evidence-based, patient-centered care for all.

Over the last three years, I have predicted that Medicare reform would pave the way for health care reform, and this bill makes that possible. Under the legislation, Congress will no longer be in a position to thwart Medicare’s efforts to rein in spending by eliminating waste. Not everyone is happy about this. Over at Politico.com former Republican Senator Bill Frist and former Democratic Senator John Breaux register their protest in a column titled “Keep Medicare in Congress’ Hands.”

Under reform, politicians and lobbyists will no longer have the power to decide what Medicare pays for and how it pays for it. Frist and Breaux put their finger on a critical change at the very heart of the legislation when they complain that an “Independent Payment Advisory Board,” made up of physicians and health care experts, will be able to propose changes in Medicare payments that “become law unless Congress enacts its own proposal to achieve the same level of cuts.” Legislators will be loathe to take responsibility for cuts. Moreover “Congressional leaders will have to muster . . . .a super-majority of votes if they want to overturn the board’s decisions.”

Medicare and the Public Option

Ultimately, Medicare will help set standards for better, more efficient medical care, and in that role, it could serve as a partial substitute for the public option. When Joe Lieberman decided to kill a government alternative to private insurance, saying “I’m not going to let this happen,” I couldn’t believe that one sanctimonious and spectacularly solipsistic Senator could do that much damage. But he did. The Democrats who followed him were too weak to take a stand on their own, but he gave them a faux leader. That made the difference.

Liberals were horribly disappointed by the loss of the public option. I myself had called it “the heart” of reform. But like many others, I took a deep breath and a long, hard look at what the legislation would still be able to do. At that point, I realized that Medicare, like a public option, could set a high bar for healthcare by insisting on value for our healthcare dollars.

As I explained earlier this month, under the reconciliation bill Medicare will have the power to roll out successful “pilot projects” nationwide—without waiting for Congressional approval. In the past, Medicare has launched many very successful “demonstration projects” that improved quality while cutting costs. But because these were “demonstration projects,” and not “pilot projects,” Medicare could not implement them without going through Congress.

And in Congress, demonstration projects that reined in spending were often unpopular. After all, whenever you save health care dollars, you cut into someone’s revenue stream. So, on more than one occasion, Congress has blocked Medicare reforms.

For example, one demonstration project “bundled” payments to doctors and hospitals involved in by-pass surgery at seven hospitals, encouraging doctors and hospitals to collaborate in figuring how to make care more efficient. As a result, Medicare saved millions; both hospitals and doctors actually saw higher profits, and patient satisfaction soared. Yet Congress never let Medicare implement the project on a larger scale.

Under the new legislation politicians and lobbyists will no longer be able to block change. Inevitably, Medicare reforms will ripple out into the private sector. Insurers would be happy to save money. They have made it clear that if Medicare leads the way in reining in health care inflation, they will follow.

Who Would Have Guessed?

This is just one of many provisions in the final legislation that will help rescue our health care system from the lobbyists. This may not be a great bill, but it represents a remarkably good start. As Bob Wachter, Associate Chairman of the Department of Medicine at UCSF, and a leader in the world of patient safety, pointed out yesterday on THCB: despite the insanity of the past year—the tea-parties, the lies, and the extraordinary display of self-interest exhibited by some legislators on both sides of the aisle—what has emerged is a surprisingly sane piece of legislation.

“Who could have guessed,” asks Wachter, “that in a year that brought us Death Panels, Pickup Trucks, ‘You Lie,’ The Cornhusker Compromise, Bart Stupak (boy, that must have been a tough name to grow up with), and the Senate Parliamentarian-as-Rock-Star, we would be on the cusp of passing a perfectly acceptable healthcare reform bill, a once-in-a-generation legislative achievement. )

“Unmistakably, the mojo has shifted back to the Democrats,” Wachter declares. “It is amazing how a dour and monolithic opposition can cause even Dems to unite for a common cause. Our President has also learned a few lessons, including the importance of symbols, populism, and singing with one’s diaphragm. (We knew we were in trouble a few weeks ago when Rahm started being criticized for not being sufficiently Machiavellian.)”

I wholeheartedly agree. Ultimately the Republicans did reformers a gigantic favor by presenting such unwavering opposition to reform. The bi-partisan Summit marked a turning point. At the time, I wondered what President Obama hoped to accomplish. It seemed obvious that the opposition was quite definitely not inclined toward compromise. But the summit dramatized that fact in a way that talking heads and talking points never could.

The president was patient. He listened calmly, while Republicans made it painfully clear that they just weren’t interested in universal coverage. They would be willing to cover 3 million, but not 30 million. Suddenly, all of the other details fell away. Those two numbers stood out in stark contrast to each other. Shall we save three million or thirty million? Not dollars, but human beings.

What is distressing is to realize that the conservatives do represent some part of the public—including many of those protesting in Washington yesterday. Jon Cohn, who was there, reports that to conservatives protesting on the Capitol lawn Saturday, Health care reform is “about having their money taken for the sake of somebody else’s security. When they hear stories of people left bankrupt or sick because of uninsurance, they are more likely to see a lack of personal responsibility and virtue than a lack of good fortune. As my colleague Jonathan Chait has observed, theirs is an extreme version of a view common (although surely not universal) on the right: That individuals can fend for themselves, as long as they are responsible and as long as the government gets out of the way.”

At a recent conference where I was doing a Q&A with the audience, a young man asked how I justify asking people to pay for someone else’s health care. My response: “There but for fortune.” He nodded. Somewhat to my surprise, he seemed satisfied with the answer.

Those who oppose universal coverage display a lack of compassion that I find baffling. To be fair, let me add: I’m sure that some conservatives in Congress do care about the suffering that the uninsured endure, but they—or their leaders– cared more about “breaking Obama.” For some, this was never about health care.

The Process was “Nauseating,” but the Policy That Emerged “Ain’t Bad”

Yet despite the rage, despite the ugliness of the political process, the legislation that has emerged “ ain’t bad,” Wachter observes. “To an impressive degree, the crazy deals, the budget sleights-of-hand, and the extremist positions have been or will be stripped out of the final text. The bill will manage to cover most uninsured Americans. Its new revenue streams are not magical: higher taxes on wealthy Medicare recipients, some take-backs from generously funded Medicare HMOs . . . The most heinous aspects of the under-regulated insurance system – particularly the exclusions for preexisting conditions and the possibility of losing insurance after becoming ill – will become memories of a crueler American past, like slavery and McCarthyism.” Wachter’s analogies are apt. With this legislation, we have declared an end to cruelties that have no place in a civilized society. We have decided, once and for all, that we, as a society, have an obligation to make medical care available to all, and that no one should be punished for being sick.

Over the long term, reform will save money, but the legislation does not pretend that insuring 30 million American won’t cost anything. The bill raises taxes on individuals earning over $200,000 (and couples earning over $250,000). In the midst of a recession, the middle-class is not in a position to help. But this lucky group–the top 3%– is. Over the past thirty years, those at the top of the income ladder have watched their marginal tax rate fall, while their incomes soared. (One way to measure the gains high-income Americans have made: in 1980, the top 5% earned 2.86 times median income; today they bring home more than 3.5 times median income.) The bill also saves billions by cutting back on windfall payments for insurers who offer Medicare Advantage—another sensible decision.

Keep in mind, even if we had not decided to protect the uninsured, we would have had to raise money to save Medicare from insolvency. Inevitably, we would have had to ask wealthier Americans to contribute more. Under reform, we can save Medicare, and expand coverage while squeezing waste out of the system.

We’re Moving In the Right Direction: Details That Have Been Overlooked

We all acknowledge that the bill is “not perfect.” As Wachter points out, “Not everyone is covered. The problems with the malpractice system remain largely unaddressed. . . Lots of newly insured people won’t be able to find a primary care doc. Care will remain fragmented and chaotic for the foreseeable future.”

This is all true—and is one reason why we’ll need three years before we can make full-scale health care reform a reality.

“But even in these areas,” he argues, “the winds are blowing in the right direction: support for comparative effectiveness research; experiments with bundling, Accountable Care Organizations, and Medical Homes; promotion of improved transitions; malpractice pilot studies; a small dose of steroids for MedPAC,” he adds, referring to the new power given to the Independent Payment Advisory Board. “And maybe, just maybe,” Wachter adds, “a renewed sense that Washington can tackle hard problems.”

During more than a year of debate, the media focused so intently on the political process (who’s winning? who’s losing?), that it often neglected the details of health care policy that make this legislation so important. There are many provisions in the final bill that have received relatively little attention. Did you know, for instance, that Medicare beneficiaries will be able to get preventive care recommended by the U.S. Preventive Services Task Force without paying a co-pay or worrying about a deductible? This provision goes into effect January 1, 2001. Six months after the legislation passes, private insurers also will be required to offer free preventive in any new plans that they offer to the public.

Insurers also will be asked to spend more on medical care, less on administration–or give money back to their customers. Under the legislation, plans in the individual and small group market will be required to spend 80 percent of premium dollars on medical services, and plans in the large group market (where administrative costs are lower) are expected to pay out 85 percent. Insurers that do not meet these thresholds must provide rebates to policyholders. Again, this will go into effective on January 1, 2011. (Thanks to Health Beat readers Walter Ballin, and “run 75441” who inspired me to do a little research by asking questions about these provisions.)

I’m sure that some of you are thinking that letting insurers keep 15 percent to cover administrative costs sounds overly generous. I haven’t done the numbers, but I wonder: could insurers make do with 12%.? What I do know is that today, some insurers spend close to 20% of premiums on advertising, marketing, lobbying, underwriting and salaries. So the new rule should lead to savings. Again, not perfect, but an improvement.

Moreover, the truth is that our insurance system is labor intensive—and paper intensive. We are told that Americans want “choices,” and as a result the insurance industry offers a smorgasbord that involves an enormous amount of paper work. We have many more different insurance plans than most countries (with many more reimbursement forms). And Americans are constantly changing policies, either because they change jobs, or because they are looking for a better deal. All of this shuffling around is expensive.

This is a major reason why the private insurance industry’s administrative costs are so much higher than Medicare’s. Under Medicare there is one package of benefits for everyone, and once a senior enrolls in Medicare, he usually stays put.

As single-payer advocates will tell you, this saves an enormous amount of paper work. Under a single-payer system, you can save even more if all doctors work for the government, all hospitals are owned by the government, and they all are required to charge the same fees—set by the government. But this point in time, most Americans patients and doctors are not ready for such a radical change. I doubt we ever will want to turn physicians into government employees who work for government-owned hospitals. Thus, we will spend more on administration than some other countries.

That said, I do believe that over the next three years, the odds are high that Congress will add a public option to reform legislation.

Today’s vote represent the beginning of a process- and there will be no turning back. Conservatives will rail on about repeal– they’ll scream “unconstitutional” until they are hoarse. But this is major legislation, like Social Security or Medicare, and it will not be overturned. It’s worth nothing that when Social Security was making its way through Congress, some insisted that it was unconstitutional to think about letting government go into the insurance business. (Thanks to HealthBeat reader Don Levit for pointing this out.) Then, as now, the naysayers had no legal ground for their claims.

Whatever the conservatives may say, the legislation that will pass today is far from extreme. As Wachter notes “The fact that it has no chance of attracting a single Republican vote speaks volumes about cold political calculation, and relatively little about the nature of the changes the bill will usher in. This is, in fact, a bipartisan bill – one that deftly splits the difference between lefties who want single payer and massive government involvement, and righties who want to ‘keep Government out of my Medicare!’

In the end, reformers stayed the course. As Dan Rather reminds us in the interview below, when Lyndon Johnson persuaded Congress to pass Medicare, the country was not nearly as polarized as it is today. I am sorry to see the nation divided, but in this case, I believe that such sharp differences provided clarity. The moral choice was clear—as clear as it was when Congress enacted civil rights legislation. To his great credit, despite an extraordinarily hostile environment, President Barack Obama persevered, and in the end he stood up. Last night, he quoted Lincoln: “I am not bound to win, but I am bound to be true.” Often, being true to yourself , and to principle, is the only way to win.

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.

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  3. The media keeps stating that this bill is not socialist in that private companies will insure the people by the simple means of spreading the paying ability over a wider base, and for those who can not afford the premiums the government will subsidize their premiums. OR to simply state the facts they will take taxpayer money and give it to someone more deserving than you so they can have health insurance. (SOCIALIZED MEDICINE). Ask your Congressperson, the media anyone you want where the subsidy money come from and they will tell you by increasing the taxes on the wealthiest,(SPREAD THE WEALTH} those who earn 250k and above, and when that doesn’t cover the cost they will start collecting from those with incomes 100K and more. This cycle will continue until those who work pay for those who do not but you can be assured that that single MOM with 14 kids won’t have to worry nor will that person sitting on the corner selling dope collecting a few thousand or the person who has always lived at home and never worked a day in his life. Instead you get to buy insurance for them. Not to mention the fact that you can bet that the insurance companies are going to take their money and pay the bills when they start losing money from the increased number of people filing claims or maybe the doctors and hospitals and ambulance services and pharmaceutical companies will lower their prices. Get Real, we are moving closer to a communist country with each freedom we give up Freedom is lost when you give up control of your own lives and allow or depend on others to make decisions for you.
    Here’s to the demise of LIBERTY IN THE UNITED SOCIALIST STATES OF AMERICA LONG LIVE THE (Democratic) PARTY

  4. maggie,
    I really enjoy your posts.
    According to my doctor friends, the AMA is not really representative of the entire physician community of the US.
    Thus, the theory goes, the AMA’s support of the bill is irrelevant as to whether the physicians on the whole support the bill.
    Is this true?

  5. MD as Hell, Public Health bugle, George Hill,
    ghand, jd & Done With This, Wendell, Rob, tcoyote,
    Will be back to respond to others.
    jd -You’re right, few people have written about it, but
    more people will feel free to leave their jobs and become entrepreneurs.
    On pilot projects, I’m quoting the March 4 NEJM — here
    http://healthcarereform.nejm.org/?p=3108&query=home
    I wrote about this on HealthBeat here http://www.healthbeatblog.com/2010/03/peggy-noonan-vs-the-new-england-journal-of-medicine.html
    (Come on over to HealthBeat sometimes–would appreacite your comments.
    MD as Hell– the current economic collapse was brought to us by the excesses of the 1990s–including overspending on unncessary treatmetnts as well as stock market and real estate bubbles. George Bush’s free-spending ways (tax cuts, war) pushed us way, way over the top.
    In case you haven’t heard, over time health care reform SAVES money. See Ezra Klein in Washington Post.Today he ran a nice graph.
    Public Health– Thanks for the link
    George Hill — Yes, yes, yes.
    Hand G. I agree.
    See my comment below to jd
    jd– Yes, I agree. There will be a shortage of primary care docs for a while (it takes a number of years for them to come through teh pipeline) but I think that in the future, more med students will become primary care docs because reform creates generous loans and scholarships for med students interested in primary care. Those loans and scholarships will attract from applicants from low-income families, and reserach shows that these students are more likely to choose primary care and far more likely to want to practice in areas where they grew up–which are areas where they are most needed, inner cities and rural areas.
    Students from low-income families are likely to consider a $100,000 or $110,000 starting salary perfectly fine–especially if they don’t graduate with loans. Average income btw, for primary care is $160,000 and more and more docs will be working for medical centers or accountable care organizations that take care of overhead, malpractice insurance, etc.
    So, I agree: I don’t think “Done With This” will be misssed.
    Between now and 2014, we should see more nurse practitioners entering the marketplace. The bill provides raises for nursing school teaches and Medicare is raising pay for nurse practioners.
    Why did the AMA support the bill in the end? It’s always better to be on the winner’s side. They would like the White House to view the AMA as a friend.
    And it also would have looked pretty bad if the oldest organization of MDs in the nation held out against the idea of giving everyone access to health care.
    Wendell– Thank you –and I agree with everything you say. See my response to Rob below
    Rob– When people resort to name-calling, this is usually a sign that they have few ideas. I’m afraid your comment confirms the theory.
    There are plenty of specialits in Europe–where pay is much lower. Many physicians actually choose a specialty becuase they find the work and the science fascinating.
    As for equalizing incomes– the growing gaps between the mega rich, the rich, the upper-cmiddle class, the middle-class the working class and the poor in this country have undermined both the economy and the society.
    The U.S. was a stronger nation in teh 50s and early 60s when the differences were much, much smaller. And last time I checked, Eisenhower wasn’t presiding over a socialist state.
    tcoyote– Glad you agree with most.
    Medicare couldn’t be extended to people 55 to 64 because in a pool made up of older people the premiums would have been too expensive. (You couldn’t use Medicare money for the 55-64 year olds; they would have to pay their own way, and given the amount of medical care they need, you’re looking at premiuims for maybe $17,000 to $20,000 per person. An insurance pool has to include a fair number of young, healthy people or insurance just isn’t affordable.)
    Congress won’t interfere with the pilot projects. The law makes it very, very difficult. And Congress knows that if Medicare doesn’t cut spending, it becomes insolvent. Congress does not ant to be blamed for Medicare going under.
    The private sector is not going to create enough jobs to pull us out of this recession. Unemployment continues to rise (the numbers look static because more and more people are either giving up looking for worok, or taking part-time jobs, and so aren’t included in
    the unemployments numbers.)
    Government will have to create jobs. And in many ways, this is all to the good. There are many things that have to be done–from repairing infrastructre to staffing day-care centers and cleaning up our cities.
    These are jobs that will serve the public good.
    Unforutnately, in recent years, the private sector has been creating more and more jobs that do not add to the wealth of the nation– Wall Street jobs where pepple sell paper, taking bigger and bigger risks, jobs manufacturing gas-guzzling, over-sized and not very safe cars; jobs creating and selling junk food– I could go on.
    Finally, thanks for the literary advice.
    Since I taught writing and English lit at an Ivy-league university for many years, I do think about writing.
    If I spent more hours on my posts, definitely they could be tightened. I re-wrote every chapter of my book many times. But a book will be around for many years. I view a blog-post as closer to conversation. Rather than trying to polish every post, I prefer to write about my subjects–and respond to readers. Only so many hours in the day.
    In the end, different styles appeal to different readers. A critic once called Middlemarch a “loose baggy monster” of a book. I think it’s the best novel in the English language–as do many others.
    “Poorly wrought verbiage”, on the other hand, strikes me as an inflelicitious phrase.

  6. REPEAL HAS STARTED
    Gee. Wonder why?
    It would be like a weak president, going on the road, to defend laws that were shoved down the throats of taxpayers.
    Oh. He is, going on the road?
    Never mind.
    Matthew, going on welfare now. Keep working — I don’t want to work. If welfare is good enough for ACORN, it is good enough for moi. Have a nice day.

  7. “In addition there are neither theoretical nor practical reasons why investment decisions cannot be made equally well by governmental or private entities. Foolish and wise investment decisions have always been made by both.”
    Uh, there is one quite practical reason that separates the two types of investors: politics. No private investor could realistically propose to invest money into ventures that lose money like crazy for perhaps eternity. At some point, shareholders, owners, or investors must see something for their dollars. However, political considerations can allow billions to be flowed into botomless pit money-losers on the government side. Indeed, flowing funds into strongly focused political constituencies (even if poor economic investments) can pay strong political dividends. Again, if the “benefit” sought is political support, then whether the venture is a foolish investment is irrelevant.
    Political considerations clearly played a role in the scuttling of DME reforms for Medicare, for example. A focused political constutuency won out, even though it meant taxpayers overpaid by the billions.
    The ability to shift losses to another entity (taxpayers) is what separates private and public investments. Private sector investors can go broke (unless their political clout saves them), which can create market discipline.

  8. I think that Nancy Pelosi summed it up perfectly. We need to do something now. This will have to suffice. We can not have 30 million plus uninsured Americans; it is inhumane. We have a collective responsibility to take care of one another. There is more at stake here than a few dollars that we don’t have. How can we have unity as a nation if we do not see one another as equals with equal rights?
    I am proud to be in health care but up until this point, I have not been proud of American health care. This bill will sting for a while but we will come together as a nation to serve the greater good of all Americans.

  9. Is important to reform health care as indicate findrxonline appropriate and capable people should take a position as important as this, remember that previous governments failed to put disabled people who can solve the health problems that are in this country.

  10. Okay, let me see if I have this information correct. The Republicans are angry because of the abortion language in the health care bill, yet without the bill all the children born to these low-income and uninsured mothers who are “saved’ wouldn’t have the insurance they need for natal care and other unfortunate happenings. They are so worried about the fetus, but the child can suffer? This is not about a hand out, this is about caring for the children YOU so desperately fought to keep alive. You have no problem taking away a woman’s right to make her own decision, and now you want her to NOT have the ability to care for the child once it’s born? Most contraceptives are NOT covered by insurance, so don’t use that as an excuse. I know, I work in the medical field. Please, if there is a Republican in the house, explain this to me.

  11. bev, I think you are right. It’s not just the lady docs, but also a financial push to practice in larger groups and even hospital owned practices. I am not making a qualitative statement as to which is better, but I think the small, free standing practice is going to fade away.
    On the same topic, is there any reason why we couldn’t increase the number of entering medical students?
    tcoyote, shouldn’t there be a balance between the TLC we provide to capital, so it stays here, and the requirement that capital contributes to welfare enough to keep this a fertile ground for capital’s endeavors?

  12. Um, will you be declining your Medicare coverage upon reaching age 65 or your social security benefits, also? And your car insurance…you dropping that too?
    C’mon. This is not helpful.

  13. My Declaration
    I, Brian McCrary will not comply with this new Healthcare bill as law, nor will I abide by it. If for some reason I fall outside having Health Insurance, I will not be paying the penalty, fine or tax, and I will not go to jail for not doing so, come what may. I will not be forced to pay for a product by the Federal Government or anyone else. That is simply nothing but extortion.
    This is an unconstitutional law and therefore I am not obligated to comply with it.
    Welcome to the Resistance!

  14. Just something I’ve wondered, if near-universal coverage is achieved, does it eventually provide grounds to challenge the tax-exempt status of hospitals? So much of the exemption is based on the provision of charity/uncompensated care. The legislation scales back DSH payments in recognition of this. Is it reasonable/right to challenge the larger exemption? It could be worth hundreds of millions of dollars.

  15. “We will agree to disagree about how wealth is created and the role of tax incentives in the process”
    Ireland’s faux economic “miracle” was driven almost entirely by low rates of taxation that attracted much investment, much of which has now turned out to have been wasted, along with reflecting an ultimately fictitious increase in employment.
    There are many factors underlying investment decisions. Taxation of potential gains or the available of tax credits or the tax treatment of losses or similar play some role, but most investment occurs on the basis of the underlying economics of any project irrespective of such inducements.
    “tax incentives play a crucial role in where it goes”
    Sorry to note, but empirical evidence does not support this assertion, at least over the long term. As I note above, they along with other inducements play some role, but rarely a decisive one. Strategic, operational and other fundamental economic factors predominate by a long shot.
    In addition there are neither theoretical nor practical reasons why investment decisions cannot be made equally well by governmental or private entities. Foolish and wise investment decisions have always been made by both.
    I have not previously taken the time to look at the relative success or failure of Medicare pilot programs, so I appreciate the references. My limited personal knowledge of a few concurs with your assertion, although the underlying idea for the pilot programs is solid.

  16. Wendell, a good place to start learning about Medicare’s demo program history is Marcia Gold’s piece in Health Affairs in 2005 “Challenges in Improving Care for High Risk Seniors in Medicare’ http://content.healthaffairs.org/cgi/reprint/hlthaff.w5.199v1?maxtoshow=&hits=40&RESULTFORMAT=&fulltext=Medicare+Chronic+Care+Demostrations&searchid=1&FIRSTINDEX=0&resourcetype=HWCIT
    Berenson and Horvath address some of the structural issues that have prevented major constructive changes in Medicare in their 2003 Health Affairs piece “Confronting the Barriers to Chronic Care Management in Medicare”.
    There’s a lot of work to do for the new Innovation Center, believe me, and it will take many years to prove out some of the promising new ideas or consign them to a large junk heap of academic theories about changing physician and patient behavior.
    The problems Marcia (of the policy research shop Mathematica) discussed continued through the latest round of demos (since her paper) like the recent Medicare PGP and Disease Management demos.
    We will agree to disagree about how wealth is created and the role of tax incentives in the process. As someone who participates in this process, growth capital is not “donated” to the economy, it is invested, and tax incentives play a crucial role in where it goes. There is a global market for investment, and the major players have a lot of choices about where they play, not just here. . .

  17. Every eighty hour a week “Exhausted MD” that retires and is replaced by a “shift worker” represents a 30% loss in FTE physician effort. There’s an entire generation of Exhausted MD’s ready to retire. It may be time (I don’t want to be treated by someone who’s tired of practicing medicine). But the combination of three factors: a large cohort of pissed off older docs- 40-50 thousand is my number- ready to go, a tiny % of new docs interested in practicing primary care (for any number of hours- shift work or otherwise) and a 30 million person increase in the number of insured people- will create a horrendous back up in access to primary care and a flood of new Emergency room cases, just like Massachusetts. The bill does contain a whole Title about manpower, but too little and much too late. This is the biggest iceberg in the health reform shipping lane . . .

  18. OK, I’ll throw in a wild card in this discussion of supply of physicians. As I mentioned in an earlier post, the current method of residents working shortened shifts with multiple handoffs,combined with the rise of hospitalists, will lead increasingly to a “shift mentality” among physicians, meaning they will be more willing to work for a salary or something similar, in exchange for predictable hours. In addition,the fact that about 50% of current medical students are women will further enable this trend – studies show that women are more willing to work for salaries and, with child care responsibilities still strongly dumped on the female in a marriage, lady docs will want predictable shifts too.
    Therefore I see the future physician workforce more hospital or large group-employed, more salaried (at still a good income), and, with the expansion of medical schools already mentioned above, more plentiful. It is the old guard already practicing who are railing the most against this issue, because they have the most to lose.

  19. I disagree with tcoyote’s “quibbles”. Ms. Mahar not only has a source of income that permits her to know the issues in detail, but she also is clearly one of the better writers writing on topic.
    Have you never learned to skim when reading, if the text appears to be a bit too verbose?
    “The “rich” is where nearly all our investment capital comes from to create new jobs.”
    Not true. Investment capital is available regardless of tax rates imposed on capital gains.
    Investment funds by definition are any funds not applied to consumption. Those funds are always available and always in adequate amount relative to potential investment-worthy need.
    The disparity between rates applied to capital gains and to other income is an explicit transfer of income from those with lower income to those with higher income. It benefits only the wealthy to any material degree and benefits the most wealthy and highest income by far the most. The progressive lessening of capital gains tax rates is one of the more heinous legislative “successes” of Republican Congress members and of far too many Democrats.
    Income is income and should be taxed equally. The same marginal rates should apply to capital gains as to ordinary income.
    “very few of the Medicare demos actually save money or improve quality”
    Although this may well be true, the assertion has to be backed by evidence. What are the specifics you refer to?

  20. Rob: Your opinion may be that I am an idiot. I doubt that anyone who knows me – indifferent whether that person likes me or not – would agree with you.
    As usual the “socialist” evocation is pure nonsense. You clearly have no clue how the current system of compensation to physicians works in the USA.
    The compensation scheme is almost completely an administered one and one that is largely ultimately set by physicians themselves through the infamous RUC and less infamously through the RBRVS system.
    In any case the “equalization” comment has to do with the untenable disparity in median net income of roughly 2 to 1 that separates primary care from specialties. The inevitable result of this persistent disparity lessens the number of primary care physicians and increases the number of specialists thereby adding one more unchecked source to the ludicrously inflated cost of medical services in the USA.
    Ever think of doing a bit of basic research before in effect “mouthing off” in a weblog?

  21. Believe it or not, I agree w/ most of Maggie’s post. Not to quibble, but Medicare IS the public option, and it could have been broadened modestly to take in some older folks without creating a lot of new bureaucracy or cost. Most private health plans ALREADY benchmark against Medicare payment rates in their provider contracts, and they usually wait until Medicare decides to cover a new technology before paying for it. The kerfuffle over the nugatory “public option” almost killed this bill, by creating deadly division inside the Dem’s huge majorities.
    Another quibble: very few of the Medicare demos actually save money or improved quality. They’ve been trying to figure the chronic care problem out for twenty five years without a lot of success. And where new ideas, like competitive bidding for DME, actually bite, Congress moves in quickly and stops it. They’ll figure out a way with the new Independent Commission too.
    One area of strong disagreement. The “rich” is where nearly all our investment capital comes from to create new jobs. We increased the capital gains tax by, what, 25% to help pay for this bill. We’ll increase it again by 5 percentage points when the Bush tax cuts expire. So between this bill and the expiration, cap gains taxes go up by 60%. Where’s the recovery (that determines if Obama’s re-elected) going to come from? I’m going on Medicare soon, and know I’m probably going to be using the benefit longer than most of my age peers will. So I don’t object to paying more for those benefits. This is the wrong way to do it.
    Finally, Maggie, seriously, for all of us, you need to learn to edit your posts. You have a tremendous wealth of knowledge, and wonderful strong opinions. But your postings SPRAWL, and dilute your most important points in a flood of poorly wrought verbiage. They’d be more effective if you pared them back to the most important points, eg. by 40%. Same for your comments.

  22. Wendell, you are an idiot. Equalization of pay? There is an excellent socialist idea. The only effect this would have on medicine is less physicians would bother to specialize. If you are going to make the same money as a general practitioner why the heck would you complete the extra training and spend the extra time to be a cardio-thoracic surgeon? This inevitably leads to a rationing of care because there will be a shortage of specialists. With this they’ll be one of two choices, take your chances on a waiting list and hope you don’t die before you get the care you need, or maybe you might want your primary care physician to take a stab at your open heart surgery. Good luck with that.

  23. I could not agree more with Jd, previously know as “jd”, I believe.
    The occupation/profession of medicine is a remarkably stable one in regard to the normal vagaries of employment and will always be a remarkably lucrative one, so there will be no dearth of high-quality physicians available. Short-term and in various geographic segments there will be shortages of course, but long-term the potential in fact for greater supply than demand is always there.
    Equalization of compensation is a necessity and there is some chance that will happen as a result of this legislation and further changes.
    As usual, excellent and thorough analysis from Ms. Mahar. Glad that her occupation permits her to expand at length on all related topics. A significant value to all readers/participants to this website.
    Given the incessant complaining from MD as HELL about his occupation, why does he continue with it? Life is full of alternatives for those of any age and certainly for those with a semi-scientific background and relatively high level of skill and education.

  24. Hand G is basically right. These physicians no longer appreciate how many will be willing to replace them. Even if the average income for specialists goes down $100,000 a year, most of these specialties will still be among the most lucrative jobs in America. Primary care pay may actually go up with this legislation.
    Dozens of medical schools are being created or expanding. There may be a transitional rough patch as more leave than enter for a few years, but history will shake its head at you guys.
    One thing I would be interested to hear: why do you think the AMA and other physician organizations supported the bill?

  25. @ Done with this…
    Don’t worry, you’re not alone in considering yourself more indispensable than you really are; your exit might be noticed but within a few weeks it’ll be as though you were never there.
    Healthcare, rather like nature, abhors a vacuum.
    Well done to all in America who have remembered and acted upon the fact that a democracy is supposed to work for the majority; not the minority.

  26. Health Care Reform is about to be a reality with the signature of Barack Obama.
    This is a victory for America.
    The Republicans have tried to stop us from having a better health care system for decades.
    Their greed and self interest went hand in hand with the corrupt system that started with Richard Nixon.
    In fact, many members of the GOP took money from the health care industry to keep things the same.
    That meant legal robbery that wound up taking money from you.
    The voters said … “No More!”
    The days and years of Republican corruption is over.
    This is a victory for all people.
    Health Care Reform is here.
    George Vreeland Hill

  27. I guess it’s time to start firing the staff, stop my 100 hour work weeks and close the business. I didn’t give birth to my employees and I’m tired of the government telling me I have to be their mommy

  28. It is time for the doctors of America to take it easy and smell the daisies that have been planted by the left. We are working too hard. There is no need to kill ourselves trying to keep up with the red tape and the regulations. Just make what you need and then stop until the following year. Cut back your payrolls. Eliminate benefits. Pay less tax.
    I suppose the black market will flourish. I suppose the central committee of the democrat party will break the will of the previously united states of America and reconstitute into the united counties of america.
    I imagine we will recover from the coming economic collapes eventually.

  29. Not only do insurance carriers shaft the patients, they shaft the physicians as well.
    If the physician does not want to “join” and insurance plan but the patient of that plan arrives for treatment, the plan does what it can to punish the physician. Notably, the payment, even at the reduced rate, is sent to the patient. The patient believes it to be a freebie. Collection costs, if the fee is ever collected, are excessive as is the time wasted.
    I am so efficient that I will open my doors to all of the newly insured… a willing provider, if you will. However, I do not want to put up with all of the bs from the insurers to collect the fee. Is there anything in the bill to enable the doctors to get paid?

  30. I am so glad this is over there needs to be some help out there for people who are sick. Not all people are worthless and can’t afford to pay. Many American have lost there jobs, houses, and there health and have nothing. Repbulicans have held this back for selfish reasons only because if there heart was in it this process wouldn’t have taken this long.

  31. Just one comment: With N.O.W. repudiating Obama for his pending executive order to prevent federal funding for abortion, which, by the way, has no real teeth, and you would think responsible and aware House representatives like Stupak knew this, what does this say about the dedication and committment of politicians like these two hypocritical bastards!?
    Oh, yeah, just two of many to decide health care decisions for Americans for the remainder of this country’s history hereon.
    Enjoy the party tonight, just like New Year’s Eve. I hope the hangover beats all you supporters to the ground! Forget “careful what you wish for”, health care supporters. Prepare for who will participate as providers for this tripe by 2014.

  32. Thanks Maggie. One observation and one question.
    First, Pelosi moments ago (in her pre-vote speech) mentioned something that I think is important but has hardly been mentioned at all: in allowing people the freedom to get community-rated insurance regardless of whether their employer offers it, there will be a big boost to entrepreneurship in the US. Many people, including myself at one point of my life, have stayed in a job they didn’t like in part because they were afraid that if they struck out on their own they either wouldn’t be able to get insurance at all, or would have to pay through the nose for it. Aside from any economic benefit, there is the benefit in freedom.
    Second, Maggie I know you’ve read this bill in more detail than I have so I have a question for you: are you sure that the pilot programs this bill licenses can be enacted without an act of Congress? I had thought provisions were inserted to reduce the ability of these pilots to make an impact by requiring Congress to vote to approve the rollout of the pilots to Medicare generally. You seem to be saying that is not true.

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