Last week I wrote about the nursing shortage, and I took the mainstream view that it really was a big problem, while suggesting that technology may help solve that problem; (in an update to that post, the Industry Veteran somewhat dissented!). Last year following the COGME recommendations my THCB article on physician supply suggested that we may not have the future shortage of doctors that current mainstream thinking suggests is coming around 2020.

Following an article by David Blumenthal in the NEJM, Mike Magee, the Pfizer-backed doc who does the weekly Health Politics web-column, had a pretty interesting recent summary of the whole topic of physician supply. Magee’s article included a very valuable discussion of the different contributions of different medical schools (MD, DO and Foreign) to the supply of residents, and the changes over time for funding of resident positions.

The three major sources of physician numbers in the U.S. remain deeply segregated from and in partial denial of one another. They include 126 MD-granting allopathic medical schools, 20 DO-granting osteopathic medical schools, and a wide array of non-U.S. medical schools. Together they create our supply of men and women graduates who fill hospital residency positions. The residents, in turn, provide our ongoing supply of licensed physicians. In 2001-2002, there were approximately 100,958 persons in approved residency training programs. Approximately 65 percent of our supply of licensed, practicing resident physicians in training were MD-educated, nine percent were DO-educated, and 26 percent were non-U.S. educated.

Magee basically rewrites the question underlying the debate into this format: Is more health care and more physicians better for the nations health or worse for its economy? In other words is health care spending a drain on limited resources or an acceptable use of resources in an era of discretionary spending on "luxury" services? While you could argue over which, there’s no real argument that the more physicians we have, the more we’ll spend on health care. Vic Fuchs proved that with his research on supplier induced demand for physician services more than 25 years ago. That’s why every other country limits the amount of physicians going into residency positions. But being as economic analysis never got anything done in this country we’re instead hearing rumblings about the "demand" that we’ll be facing from aging baby boomers, without thinking much about whether more physicians per se is the answer to that "demand" and ignoring the fact that we know from Fuch’s work that more physicians will indeed "create" more "demand". Magee starts to pose some of the right questions in his last paragraph:

What are the 21st century environmental factors that should shape this debate? First, physicians remain highly respected worldwide, and consumers expect physicians to be partners and team leaders. Second, globalization, the Internet, aging populations, population mobility, and disease migration demand that we see physician-supply planning in global terms rather than national terms. Third, new technologies allow the development of virtual medical education and virtual medical schools, which could affect the speed and efficiency of medical training worldwide. The U.S. should be actively involved in this environment. Fourth, the Internet and overnight delivery are making geographic borders obsolete. What are the new boundaries for licensing and credentialing? And finally, with borders evaporating, regulatory bodies that provide oversight for medicine and patient care need to better harmonize their approaches.

What he doesn’t say but what needs saying is, does this new world of technology make the use of physicians for much care obsolete and replaceable by clinicians with lesser training, and where does that show up in the projected numbers? Of course that eventually leads to nasty questions about whether the physician role needs to be so venerated, and of course, so highly rewarded. But we wouldn’t want to start that conversation when the AMA and its fellow travellers have been so prominent in spreading universal cost-effective health care throughout the US over the last 90 years.

Back in 1991 in a very, very brief moment of (reflected) non-stardom, which I rediscovered on an old photocopy when I was unpacking some boxes during my recent move, my name (and those of my co-authors on a piece about Japanese health care) was in an article about other countries health care systems on the front of The New York Times. At that time the health care debate was about to warm up, and the NYT was trying to educate the public–or at least the small fraction of it that reads or cares about the "paper of record"–about a few basic facts.

Those included the fact that the amount spent on healthcare as a share of GDP vastly exceeded that of other industrialized countries, that American outcomes in terms of infant mortality rates and life expectancy were only in the middle of the pack, and that some 14% of the population had no health insurance–a situation unique to the US. A series of articles about other health care systems (Canada, Germany and Japan’s among them) hinted at the fact that there may be alternative models that we possibly should just consider here. And additionally another article showed that you could, if you wanted to, cover all Americans without spending more on health care–(another article in which I glommed onto the much superior intellects of Evans, Barer and Morrison).

Well, surprise, surprise, 13 years later all those facts are still true. We have made some progress in improving overall health, we are spending a boat load more money (roughly double in nominal dollar terms, from about $800bn to $1.6 trillion), and there has been a little more research suggesting that in some specific health areas we are in fact doing a little better. But overall, despite a bunch of industry propaganda, we’re spending a lot more on what can be claimed is more or less a luxury good, and we’re still doing that equally inefficiently as we were 15 years ago.

And as in 1991, the New York Times has published an article explaining that all those problems are still here. We have made some improvements in some areas, the Commonwealth Fund and Harris have discovered that there are some areas where the US does alot better than other countries (and worse in some other areas), and we are of course spending more while covering a lower percentage of its population with insurance. The reason that we spend more is mostly because of higher unit prices, rather than more services. While this may be news to NY Times readers, it’s not to either Health Affairs readers who know about the "It’s the Prices" article from Anderson, Rheinhardt et al, or to Americans who understand that drug prices are a whole lot higher here than elsewhere. It’s also true that prices in hospital and physician services are higher here. For example when I was researching the comparison between Stanford and Tokyo hospitals back in 1990-1, it was apparent that after everything worked out, prices were about double here. In another example I had an office visit and a blood test in new Zealand in early 1993 and exactly the same visit and blood test here 7 months later. The total in New Zealand was about $65 US. In San Francisco, even with the PPO discount, the total was over $200. Funnily enough real incomes of physicians in New Zealand have gone down by about 20% over the last 20 years. Here their experience has been the opposite.

But so what? We’ve known about these disparities for at least 15 years. We’ve known about the problems of uninsurance in the US for over 90. The reasons that the system hasn’t changed are wrapped up in American domestic politics, and will stay wrapped up in American domestic politics. Those politics may change over the next few years–and I think they will change and that universal health security will be a bigger issue in 4-8 years–but no one will care about these international comparisons when that time comes around.

In a splitting of hairs in a report from the HHS inspector general, Tom Scully the administrator of CMS when the Medicare bill was passed, was found guilty essentially of lying to Congess. In fact while Scully pressured the main CMS actuary so that he didn’t reveal that the MMA would cost more than $500 billion rather than the $400bn that the Administration told Congress, he didn’t break the law in doing so.

The irony of all this is that despite the huge pressure the Administration and the leadership brought to bear mostly on House conservatives to vote for the bill, its passage has probably been a negative for the Administration, and will probably be a liability come November.

UPDATE: While neither this story nor the related ongoing enquiry into the bribery on the floor of the House while the bill was being voted on, probably won’t make much difference in real life (i.e. the election), The NY Times report on this story has a couple of juicy factoids:

In recent weeks, Mr. Scully has registered as a lobbyist for major drug companies, including Abbott Laboratories and Aventis; for Caremark Rx, a pharmacy benefit manager; and for the American Chiropractic Association and the American College of Gastroenterology, among other clients. All are affected by the new Medicare law, which Mr. Scully helped write.

And Pete Stark gets his snide oar in there.

Representative Pete Stark of California, the senior Democrat on the House Ways and Means Subcommittee on Health, said, "It sounds as though the Bush administration examined itself and found it did nothing wrong."

I’m moving today and tommorrow so dont expect much real thoughtful action here until next week. However, I’ll list a few bits and pieces you should keep up with.

As you’ll recall in my comparisons of Canadian and US healthcare systems (in my Oh Canada piece and elsewhere) the major issue for lower income Americans is their problems paying the bills associated with medical care. This is virtually unknown elsewhere in the civilized industrialized world. HSC has a new report out showing that 20 million families, which is about 20% of households, in the US have serious problems with medical bills, including having to choose between paying them and paying rent.

With a little more of this rhetoric, health care just might become a slightly more important issue for this election cycle. It’s more likely though that this will continue to build up until the dam bursts in the latter part of this decade, and we engage in a full-scale national debate a la 1992-4.

It’s well worth looking at this commentary from Kaiser Family Foundation’s Drew Altman, and preeminent health care policy expert Bob Blendon at Harvard. They recently surveyed military families about the costs of the extended tours of duty being forced upon our troops in Iraq. While most readers of THCB will have their minds made up one way or another about the war long before now, any casual walker down a mainstreet in any large American city can tell that we haven’t done a good job looking after our veterans. Altman and Blendon suggest that this lack of attention is also visited on the families of soldiers on deployment, in both health, social and financial terms.

The emotional toll that soldiers and their families pay when they are overseas for extended periods can also be high. Fifty-six percent of spouses of extended-duty soldiers are living day-to-day with the fear that their husband or wife will be injured or killed overseas. When asked about the families in their spouse’s unit, half report that marital problems are very common; 40 percent cite depression as a very common problem; 27 percent report alcohol or drug abuse problems in the unit; and 16 percent say domestic violence is very common.

The financial impact is also severe.

The financial stress of extended deployment can be severe for military families. Fully three in 10 report that in the past year, they and their family have had trouble paying bills. For more than one in five, their current financial situation is such that they have to get food stamps or Women, Infants, and Children program aid from the government. (Even 6 percent of families of officers say they receive food stamps or WIC.) Clearly more financial support is needed for the families of soldiers risking their lives for their country for an extended period of time.

Interesting that two of America’s larger employers of those who have lower educational status–the Army and Walmart–both have plenty of employees’ dependents on welfare. But given the poor follow-up social and health care given to Vietnam Veterans and the issues with Gulf War syndrome, the concept of "supporting our troops" needs to become more than just a jingoistic slogan. Or the result will be more pressure on the healthcare system in years to come.

FamiliesUSA, a pressure group that was deeply connected to the Clinton health plan back in the 1992-4 period, has produced a new report about the uninsurance numbers. Their analysis of the CPS data shows that over the course of a full year some 82 million Americans were uninsured at some point. Here’s the full report.

Last year when the CPS report came out, I had a conversation with Ross at the (now sadly mostly silent) Bloviator in which we teased out the real numbers. And these are pretty consistent. The numbers are roughly 7%, 15% and 30%. That means that, of the non-elderly 7% are uninsured for more than a year (and probably permanently), 15% are uninsured at any one time, while 30% are uninsured for some period during the year. The oft-quoted 43 million number is the 15% number, which is a snapshot. The Commonwealth Fund study showed something around 32 million Americans were uninsured for over one year in a four year period, while another 52 odd-million Americans are going in and out of uninsurance. That is the movie, and that’s where too many of us are living.

The problem for those that want to do something about this is that there is little political will to do anything about this. Despite what Bush said on the campaign trail nothing is happening on the right wing of the aisle, and the Democrats are only going to move on this in response to either a demand from a middle class that is worried about losing insurance (the political factor that drove the Clinton reform movement) or from its core constituency in the minority communities who are concerned about the very high rates of uninsurance in those populations. Thus far, we haven’t heard much from the traditional leaders of the Hispanic or African-American communities about this issue, and that seems to be the case for the long term.

So the American College of Pediatricians has come out in unanimous favor of a constitutional amendment to ban gay marriage. In their terms this is based on "the firm knowledge that the basic father-mother family unit, within marriage, is the optimal setting for childhood development". So how many of you reading this think that the leading national association for Pediatricians has just gone off its rocker?

Don’t worry it hasn’t, or at least not completely. The actual mainstream organization is the American Academy of Pediatrics. And although they too have some very dubious policy reccomendations, such as this one promoting the ban on marijuana for adults because this will supposedly help children (whatever the cost to adults or society, if indeed prohibition does help children, which it doesn’t),they’re unlikely to move into the firestorm of the gay marriage "debate". Not that I’m an expert but it seems to me that kids brought up in gay families do OK, and plenty brought up in heterosexual ones don’t!

However, my real concern is that when the wider public hears this news, how are they supposed to know that the American College of Pediatricians is a bunch of radical fundamentalist wingnuts who bitterly oppose abortion, gays, sodomy, contraception, and probably opening hours for supermarkets on Sunday? (OK I made the last piece up, but it’s probably true). Their web site demands that their members "maintain high ethical standards personally and professionally". Pity that the organization itself is prepared to be completely deceptive in its very name!

The Center for Health System Change is out with its assessment of cost increases for 2003. And believe it or not, they say costs increases are slowing, down to a mere 7.9% from 9.5% in 2002 and 10% in 2001. This is worrying news for the health care system which is having trouble making its price increases stick with the rest of society slowly improving news for the economy which is being suffocated by increasing health care costs, which result in more un and under-insured individuals and more trouble for government and employers in these cash-strapped times.

I spent the last couple of days at an IFTF conference which looked at impediments to improving health and creating a better health care system–a small topic as you may have guessed. I’ll report a little more about the conference in due course but one of the most interesting talks was from Brad Kimler from Fidelity Investments, who laid out then projected future costs of health care, and the consequent impact on what a couple retiring at 65 would need to have saved to pay their premiums for Medicare and cover their out of pocket expenses. The number was $175,000! And if you are 45 now, you’ll need $650,000 by the time you’re 65. And neither of these included long term care. In fact for a retired couple with a good pension plan, and retiree insurance from their company, by 2015 80% of their income will be going to pay their health care premiums. There was a certain amount of shock and awe around the room. While Brad admitted some self-serving interest in getting people to save more (and have Fidelity manage that process), we still have an enormous challenge facing us as a society. Currently the average 401K account retiree at Fidelity has under $100,000 in it, and of course there are no real funds in dedicated health care retirement accounts yet.

What’s even more intriguing is that Brad based his calculations on an 8% increase in costs. Of course recently we’ve seen even bigger increases in costs. Hewitt Associates yesterday came out suggesting that employers will face premium increases of up to 14%. Unless we generate some amazing productivity miracle and get much richer very quickly, there are only two ways that this can go, as the baby boomers start moving into their 60s (starting next year). Either we start dropping more people into un- or underinsurance, or we add more people to something like the Medicare program. That of course that eventually means either higher taxes for working people or lower incomes for the people providing health care services and products.

From the THCB Sacramento office Matt Quinn, who wasn’t at the conference, seems to be thinking in similar ways:

Hewitt Associates estimates that health insurers will seek 14% premium hikes from employer groups, but probably won’t get all of it. The survey notes that all of the major insurers surveyed seem to be "pricing rationally": they are reflecting increases in medical costs as increases in premiums. And – at least before they get into negotiations with large employers – none of them seems to be playing the "take a loss / make it up on volume" ponzi scheme of the past. What the survey doesn’t note, however, is how much of these premium increases employers will pass onto their employees (or how many employers will simply drop coverage for some or all employees).

So that leaves us with the current state of affairs: Employers (purchasers) expect to pay double digit premium increases each year, but can only "afford" single digit increases. Health insurers expect that their medical costs will increase at a double digit clip each year – and faster when the baby boomers hit. Hospital and drug costs are rapidly increasing, while almost all physicians expect – and most non-primary care physicians are receiving – annual pay raises. And consumers continue to want the "best" (i.e. newest and most heavily advertised) care at low or no cost.

The recent CalPERS showdown with Sutter (and other "expensive" hospitals) illustrates the growingly activist role of purchasers in managing costs, but their efforts are clearly not stemming the tide. And, as we have seen at GE, SBC, and Safeway, employee tolerance for healthcare cost increases is quite low.

I think that only one question remains: Who – other than the federal government – has the market clout to manage the cost and quality of care?

Several of the representatives from large employers at the meeting yesterday were starting to mouth the same opinion. Don’t expect anything big to happen with this Administration or Congress, so realistically even with a Kerry presidency this won’t be on the front burner till 2008-12. But absent a 1990s type productivity boom, this question is not going away.

Like Robert Centor at MedRants, Chris Rangel MD and many, many others I’m a strong opponent of the War on Drugs, but I rarely bring that up in THCB. That’s because the Drug War is largely a political, social and criminal justice issue rather than a health care issue. However, in one arena, the War on Drugs–as prosecuted both by Ashcroft’s justice department and many Republican and Democrat state and local attorneys-general is not only completely out of control, but is a direct assault on health care provision.

I’m referring of course to the draconian prosecutions of physicians who treat chronic pain by prescribing opiates. Given my other recent posts on access to rural healthcare in California, the case of Dr. Frank Fisher is very relevant. Fisher is a Harvard trained doc, who until 1999 was running a general health center for the poorer residents of Shasta county–a very rural area in far northern California–including pain management. Some time around 1996 the California and Federal authorities decided to come after him because a few people had died with only the vaguest connections to his prescribing of opiates. One had been in a car crash where he was the passenger. The charges faced by Fisher? Murder!

Last week, five years later, Fisher was cleared at trial of the only remaining criminal charge. That charge was of defrauding Medi-Cal of, wait for it, $150! (I know THCB has been critical of non-prosecution of fraud in the Medi-Cal system, but that wasn’t what we meant!). So now Fisher has to get the state medical board to give him his license back in order to go back to work. Given the history of outright lying and corrupt behavior by prosecutors in this case, that ought to be simple. Whether any of those individuals will be held accountable is less likely.

Meanwhile, what do you think happened to the patients at his clinic, which was destroyed by this action? Go read the full interview with Fisher at DRCNet, but this is an extract about what happened to the people he was serving. As you might have guessed their transition from his care to that of others in that rural underserved area was not exactly smooth:

You ran a large clinic serving a predominantly poor and rural clientele. What happened to your patients after your practice was shut down?

Fisher: The impact on the patients has been devastating, it’s been an unmitigated disaster. Their health has deteriorated, they’ve been unable to get medical care, some appear to have aged 20 years in five years, others haven’t even survived. Some patients have gained enormous amounts of weight, others have their blood pressure out of control. I suspect there has been at least one suicide. Patients are having to travel great distances to get their care; they go to Eugene or Fresno or San Francisco. Of the patients I still talk to, I don’t think a single one is being adequately treated.

Chronicle: The majority of your patients were Medi-Cal patients, poor people. Is there a class issue involved in the availability of pain treatment?

Fisher: The availability of pain management for poor people is even worse than for the rest of us. And it’s not good for the rest of us. Everyone who develops chronic pain is likely to be killed by it because of medical neglect. It’s a malignancy in the sense that if it is not controlled, it will spread and progress. My patients were effectively tossed out on the street to fend for themselves. The local medical clinic saw them as drug addicts who needed to be detoxed.