Category: THCB

The Value of a Life

A recent NYTimes article on how to value a life drew almost two-hundred heavy-handed comments. It discussed how different governmental agencies such as the Food and Drug Administration (FDA), the Environmental Protection Agency (EPA) or the Department of Transportation (DoT) place a monetary value on each life saved.

In many public policy areas, Cost-benefit Analysis (CBA) is being used to assess whether an investment in a particular area is worthwhile. CBA uses an “exchange rate” in which the consequences are monetarized.

The article mentioned the following values: The DOT value each life saved at or around $6 million 2010 USD$; $9.1 million 2010 US$ was the corresponding value of the EPA; and the FDA put a figure of $7.9 million 2010 USD$ (increased from $5 million in 2008 USD$) on eachlife saved from cancer death caused by cigarettes.

I did not know that the FDA considered efficiency measures such as money per life saved at all.

What I find fascinating is how arbitrary the approach of the different agencies can be. They could have just funded certain policies by how cheaply they can save a life up to a certain threshold (e.g. when thebudget is exhausted).

Instead, the EPA uses a methodology derived from logging industry (yes, you heard right). $1,000 worth of extra-work for the lumberjacks each year is generally accepted to save 1 in 1,000 lumberjacks. This was apprently developed by a Professor Viscusi who wrote his firstpaper on CBA as an undergrad at Harvard in the 1970s.

Other governmental agencies seem to survey citizens. In economics, this could actually be considered a valid approach if done right.

There were interesting comments by the readers. Some did not want to put any value of life. It was controversial if the value was too high or too low. One reader mentioned that the Federal Aviation Administration might have had a value of $450,000 per life in the late 1970s.Continue reading…

Health 2.0 Spring Fling–preview interviews

At Health 2.0 we are getting very excited for the Spring Fling this March 20-21, and in preparation, we’re doing a series of interviews with some of the speakers and panelists. Below is a list of all the interviews we’re already done, and stay tuned for two more coming this week.

Check them out and catch our Spring Fling fever!

  • Rushika Fernandopulle talked with us about the challenges and rewards in creating his new healthcare delivery model, Iora Health. Listen here.
  • Preston Maring, founder of the Kaiser Permanente Farmer’s Market, talked about the evolution of the KP farmer’s market. Listen here.
  • Brian Witlin of ShopWell gave us the details on his mobile application that allows users to scan products and see how well they fit into the user’s health and wellness goals. Listen here.
  • Amy Romano of Childbirth Connection told us what she hopes to see come from the intersection of health IT and maternity care. Listen here.
  • Eric Zimmerman of RedBrick Health gave us a peek into the new social engagement platform they’ve created for the Alliance for a Healthier Minnesota. Listen here.
  • Hemi Weingarten, founder of the Fooducate app, told us how a simple barcode scan can inform and educate consumers in the grocery store. Listen here.

Want to hear more? Come see all of these speakers and more at the Health 2.0 Spring Fling this March 21-22, 2011. Sign up here!

Health 2.0 Spring Fling Updates

Health 2.0’s Spring Fling is just 3 weeks away. We are expecting a great crowd, so register today!

Catch expertly curated sessions with brand new themes, products debuting to the public for the first time, and discussion on compelling success stories about delivery reform, all while celebrating Spring in San Diego!

Complete agenda here

Newly Confirmed Speakers

More speakers – more perspectives – more reasons to attend Health 2.0!Continue reading…

De Tocqueville Rewrites the Affordable Care Act

Pending Supreme Court review, the provisions of Affordable Care Act (ACA) are gradually working their way through the system. But we are still three years away from the centerpiece of the ACA – the insurance exchanges. The combination of purchase mandates, taxes, subsidies, and underwriting restrictions that govern the exchanges has never been tried and no one knows if the exchanges will work. Even the academic theorists who assembled this patchwork quilt of rules and regulations have their fingers crossed.

Given the lengthy wait between passage and full implementation of the ACA, it was inevitable that the op-ed pages would be filled with alternatives to exchanges. Some critics would scrap them in favor of some bastardized version of the status quo, leaving tens of millions uninsured. But commentators on the right and left have offered bolder ideas for expanding coverage. Some conservatives promote voucher plans. These proposals feature open enrollment periods and a few other mechanisms that will promote broad risk pools without all the other regulatory bells and whistles. Some liberals renew the call for a single payer system. Frankly, I think both of these “ideologically pure” approaches will be more successful than the mongrelized ACA.

This is why I am intrigued by a bill that is flying under the radar screen in Congress. This bill, which has the support of President Obama, would allow states to implement their own rules for expanding health insurance coverage. If the bill provides enough carrots in the form of tax subsidies (that would have otherwise funded the ACA exchanges), then several states might just play along. If that happens, we would have a golden opportunity to discover the strengths and weaknesses of alternative approaches. Unfortunately, I suspect that this legislation will not give states enough time to act or enough money to make it worth their while, and the vast majority of states will leave the problem of financing and implementing health reform to the feds.Continue reading…

Laboratories of Democracy, Part 2

Experimentation in how states would move toward universal health care coverage was written into the DNA of the Affordable Care Act. The law allowed any state to petition for a waiver that would enable it to enact its own brand of reform — including versions that did not include an individual mandate to purchase coverage or penalize employers who didn’t provide it – as long as their plans met the basic criteria of the law in terms of covering most people, providing comprehensive coverage, being affordable, and not increasing the federal deficit.

President Obama yesterday offered to move up the date for states that want to pursue their own visions of reform from 2017 to 2014. Stories in today’s press billed this as an effort by the administration to assuage conservative critics who’ve filed suit against the law and governors from both political parties who fear its economic impact. Medicaid expansion accounts for about half of the newly covered people under reform. Even with the feds picking up 90 percent of the tab, many states in today’s fiscal environment are wary of any new obligations — even one where they’re only on the hook for 10 percent.

As I wrote last month, leaving states to implement reform provides Americans with a classic example of federalism in action, one that may or may not lead to a common system across the U.S. In the early part of the 20th century, states began setting up unemployment and workers compensation insurance systems. The former became a shared federal-state responsibility with common features across the U.S. The latter remained unique to each state. Ohio, for instance, has a single-payer workers compensation system and insurance companies are prohibited from selling policies in the state.Continue reading…

HIMSS11: Setting Expectations

Over a 1,000 exhibitors, some 30,000+ attendees and I come away from HIMSS, again, thinking is this all there is? Where is the innovation that the Obama administration i.e., Sec. Sebellius and Dr. Blumenthal both touted in their less than inspiring keynotes on Wednesday morn? Maybe I had my blinders on, maybe I was looking in the wrong places but honestly, outside of the expected, we now have an iPad App for that type of innovation where nearly every EHR vendor has an iPad App for the EHR, or will be realeasing such this year, I just didn’t see anything that really caught my attention. But then again, looking over my posts from previous HIMSS (this was my fourth), maybe my expectations need a serious reset and it would be wise of me to read this post next year before I get on the plane to Las Vegas and HIMSS’12.

Prior to HIMSS I participated in a webinar put on by mobihealthnews (BTW, Brian at mobi has a good article on some of those mobile apps being rolled out at HIMSS this year). My role in this webinar was to give an overview of what one might expect at HIMSS’11. Having weathered the last two HIMSS and the major hype in ’09 about Meaningful Use and ’10 when HIEs were all the rage, this year I predicted that the big hype would be around ACOs. Much to my surprise such was not the case.

The reason was quite simple and two-fold.Continue reading…

Defined Contribution Health Care—The Conservatives’ Silver Bullet

Conservatives are in a full court press these days telling us the answer to America’s out-of-control health care costs—and our fiscal crisis—is to move Medicare, Medicaid, and the tax code subsidy for private insurance to a defined contribution system.

Instead of the federal government defining a benefit and then shouldering the cost of whatever that promise leads to (today’s defined benefit plan), many conservatives are suggesting that we gradually move to a system where the government only promises an annual payment (or tax credit) for health care in the form of a voucher and then the consumer uses it (arguably more efficiently) to buy one of many health plans competing for their business.

First, let me tell you that I think defined contribution health care is generally a good idea. For too long the federal tax system and Medicare policy has subsidized careless health care spending.

Many worry that defined contribution health care would lead to poor people getting second-class health care because they would not be able to afford more than the voucher allows them. That is a legitimate concern and while that outcome can be tempered it cannot likely be eliminated. But that also occurs today, as many seniors have nothing more than a combination of Medicare and Medicaid while the wealthier can afford much better supplemental insurance. And, it will occur in the future under the Affordability Act because the new federal health care subsidies are based on the more limited plans available.

But I will also tell you that it is naïve to think the way to control health care costs is to simply move to a more market-oriented defined health care system.Continue reading…

Are Academic Medical Centers Toast in a Post-Healthcare Reform World?

My hospital, UCSF Medical Center, is thriving. Our profits this year will be nearly $200 million. We’re building a sparkling clinical complex – a combined women’s, children’s, and cancer hospital – adjacent to our new downtown biomedical research campus. We are installing a state-of-the-art computer system. US News & World Report calls us the 7th best hospital in the country. Our students, residents, and fellows have never been better.

Yet angst is in the air, borne of a sense that the future is coming at us fast, and we are not prepared.

We’re not alone, mind you. Every hospital enjoying a positive bottom line today is contemplating a bleaker future. Traditionally, hospitals planned to lose about 30% on every Medicaid patient and 5-10% on every Medicare patient, while banking enough profits from commercially insured patients to make the math work out. All of these payers – both governmental and private – are getting stingier, and this latticework of cross-subsidies will soon be a fading memory.

This threat to profitability is roiling hospital board rooms everywhere, but the threats to academic medical centers seem particularly daunting. After all, the community hospital simply (I guess that should be “simply”) needs to make enough of a profit to refurbish the physical plant, pay everybody’s salaries, keep the docs and nurses happy, and save for a rainy day. Academic medical centers, on the other hand, suffer from a different problem: Mission-O-Megaly.Continue reading…

Heart Failure or System Failure?

Today’s New England Journal of Medicine reports the results of a government-funded study of two potential approaches to giving emergency diuretics to congestive heart failure patients who show up on emergency room doorsteps gasping for breath. Should it be through a continuous drip or periodic injections? Should physicians prescribe high doses or low doses of these fluid dispersal drugs? Cost isn’t an issue since diuretics are generics. The pressing question was whether high doses caused a greater incidence of renal failure, which had been suggested by a number of smaller trials.

This comparative effectiveness study is the kind of research that never receives attention in the press. No new drugs are involved, nor does it involve a high-profile disease. But it merits closer scrutiny because of the patient population. There are more than a million patients who enter hospitals every year with acute episodes of congestive heart failure. The average age in this study was 66, i.e., Medicare was paying the tab. Three quarters had been admitted to the hospital within the past year. More than half had diabetes, and around 40 percent had implanted defibrillators. Most were on two or more drugs for high blood pressure. I searched for data on the average weight of this population, but, alas, that wasn’t included. I think you can guess.

The results were mildly interesting. It didn’t matter what approach physicians took, the outcomes were about the same. Fears of exacerbating renal failure in this vulnerable patient population from high dose diuretics appear to be overblown.

I’m afraid this is going to be the conclusion of much comparative effectiveness research, which received a major shot in the arm through the 2009 stimulus bill and will receive a continuous injection of funds from the Affordable Care Act, presuming the Republicans in Congress aren’t successful in de-funding the bill. Physician and hospital practice will have better evidence about what to do in certain situations, but radical changes in procedures that have a dramatic impact on cost will be elusive.Continue reading…

The Triumph of Fear, Uncertainty, and Doubt

According to a new poll, half of all Americans say they are “confused” about healthcare reform. And boy howdy, are they right!

Take a look at this new Kaiser Family Fund poll:

Scan down to Slide 9: Almost a quarter of all Americans think that ObamaCare has been already been repealed. More than a quarter aren’t sure. Barely half are paying attention enough to realize that it’s still law.

What about the idea that the reform law is wildly unpopular, and most people want it repealed? Slide 4 shows that 39% want it repealed, and 50% want it kept or expanded. But take a look at slides 7 and 8. The only major provision of the law that a majority of Americans want repealed is the individual mandate—the part that says you have to buy healthcare insurance or be fined. Even those who want the law repealed agree, except that a majority also think it’s unfair to make the wealthy pay a heftier Medicare tax.

Think about that: Even those who will tell pollsters that they want the law repealed say that, well, yes, they think it’s a good idea to give tax credits to small business to help them give health insurance to their employees. And to close the Medicare “doughnut hole.” And to subsidize low and moderate income Americans to buy health insurance. Or to provide voluntary long-term care insurance (the CLASS Act). And to tell insurance companies that they have to take all comers (“guaranteed issue”).

So 39% want health care reform repealed, but 30% want it expanded. And a majority across the spectrum want insurance companies to be forced to sign up all comers, but they don’t want to be forced to sign up if they don’t feel like it.

What are we to make of this?

1. What most Americans think about healthcare reform is somehow not exactly what you would hear on Fox News or on the red side of the House of Representatives.
2. Most Americans aren’t exactly paying attention anyway.
3. If Americans have a strong suit, it’s not arithmetic.


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