Tag: Policy

Rantology: Cannon on Freedom or Power?

Ah-ha. Michael Cannon has now replied to me and it basically comes down in his mind to me being a  crypto-fascist Stalinist wanting to break the will of the American people mediated through its representatives, the health care industry lobbyists. His piece is The Ultimate Question: Freedom or Power?

He closes by saying that I could only fix the health care system by getting rid of constitutional democracy. And Michael’s right.

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More bad press for Insurers. Will anyone care?

Jon Cohn notes that Wendell Potter, a former PR executive with Cigna and Humana. will be appearing before a Senate Commerce Committee today. Note the word “former”.

Trudy Lieberman has an interview with Potter where he repeats what we already know:

Lieberman: How do companies manipulate the medical loss ratio?Potter: They look at expensive claims of workers in small businesses who are insured by the company, and the claims of people in the individual market. If an employer-customer has an employee or two who has a chronic illness or needs expensive care, the claims for the employee will likely trigger a review. Common industry practice is to increase premiums so high that when such accounts come up for renewal, the employer has no choice but to reduce benefits, shop for another carrier, or stop offering benefits entirely. More and more have opted for the last alternative.

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The bleedingly obvious

It makes no sense for small businesses to provide health insurance to employees. This testimony from a small business owner to the House Tri-committee yesterday shows it. (Same is true for all employers but none save Ron Wyden dare say that).

Health insurance should be paid for by some form of taxation (VAT, income tax or payroll tax) that is in  proportion to businesses and individuals profitability/income, and small businesses (and big ones) should be left to do whatever it is they do. I cannot fathom how NFIB manages to convince its members otherwise, but it does appear that there’s a crack in that dike with various small business groups coming out in support for real health reform.

Having said that, I don’t think there’s too much likelihood that a typical low wage business will get much help anytime soon.

A Dream of Reason


The dream of reason did not take power into account…Modern medicine is one of those extraordinary works of reason…But medicine is also a world of power.

-Paul Starr, The Social Transformation of American Medicine, 1984

Today’s unveiling of a Declaration of Health Data Rights is an important action, long overdue, that represents a collaborative effort by a group of health care professionals – activists, entrepreneurs, technologists and clinicians – all colleagues we hold in high esteem.

The Declaration’s several points arise from a single, simple premise: that patients own their own data, and that that ownership cannot be pre-empted by a professional or an institution. And there lies its power, especially in the context of early 21st Century health care. It is a transformative ideal that currently is not the norm. But we join our colleagues in declaring that it should be.Continue reading…

Your AHIP Quiz Question of the Day

This is something that’s been puzzling me for a few weeks. We all know that insurers are very good at  making sure that they insure healthier risks than average. In the individual market they do this openly, by underwriting against poorer risks. Those “risks” (who are most of the people with the really tragic stories) end up uninsured or in massively over-stretched state major risk pools.

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Obama vs Hillary at the AMA

Sixteen years and two days after then-First Lady and Health Care Czar Hillary Clinton went before the American Medical Association’s House of Delegates to sell her vision of national reform, President Barack Obama is treading the same path. I’m not sure how much greater eventual success Obama will have with the AMA, but having covered the Clinton speech as a reporter for the Chicago Tribune, I have three lingering memories.

The first was the invocation given before Clinton arrived. Its gist was, “Oh, Lord, you have taught us it is impolite to boo our guests, particularly in front of hordes of reporters.” The second memory was that Clinton finished her speech to a standing ovation. And the third is that she spoke fluently and passionately for 50 minutes without a prepared text, much to the chagrin of a national press corps accustomed to being spoon-fed a follow-along text before filing their stories. Fortunately, being a mere “regional reporter” (as the White House called us), I had taken notes.

Obama’s visit promises at least a few contrasts. He runs virtually no risk of being booed. He’s not only the President of the United States, and a very popular one, he’s also a president who has eschewed the perceived doctor-bashing engaged in at times by President and Mrs. Clinton. Obama most assuredly will not be speaking from notes, being as attached to the teleprompter as Ronald Reagan was to his 3×5 cards, but in the Internet Age anyone who cares to will be able to hear him live, anyway. A standing ovation? We’ll have to see.

To the amazement of her audience in 1993, Hillary went out of her way to hit all their hot buttons. For example, she praised the doctor-patient relationship and lashed out at the “excessive oversight” of insurance company reviewers and government bureaucrats who second-guess medical decisions. She talked sympathetically of the need for reforming malpractice laws and amending antitrust laws to allow medical professional societies to discipline poor-quality doctors on their own. (Here, I’m relying on a copy of my story I grabbed from an electronic archive.)

Obama, by contrast, prides himself on seasoning the obligatory political pandering with a soupcon or two of hard, cold reality. While reducing red tape and the need for defensive medicine are sure to be high on his list of promises, I don’t think he’ll hesitate to invoke the harsh global economic challenges that make health care reform so urgent. Look for Obama to remind the doctors how many more uninsured patients they’re seeing today and how much more involved Medicare has become in setting doctor pay scales.

One more contrast: in 1993, the AMA shoved forward Nancy Dickey, the one woman on their nine-person executive committee, to be its public face during the Hillary visit. Today, the organization’s elected president is Nancy Nielsen, the second woman to head the group (Dickey went on to the top job) and, though not publicized, the first who came to the post after holding a senior position in one of those dread health plans.

David Gratzer is Nice. Dennis Kucinich is not.

6a00d8341c909d53ef0105371fd47b970b-320wi I had David Gratzer on THCB a while back. He was so nice, that it was really hard for me to get mad with him—even though his book was basically a pack of lies. He seriously suggested that the UK under Blair was NHS was going to covert into an American-type system, and he couldn’t answer why he allowed his wife to come here and be uninsured!  (Of course my father the gynecologist always told me that all psychiatrists are nuts anyway)

Then last week the single payer crowd finally got to appear before a Congressional committee, and for some bizarre reason Gratzer was there too (I guess he provided balance).  And the very nice David Gratzer finds that Dennis Kucinich is not quite so nice. Watch this…

The Health Industry’s Achilles Heel

“You never want a serious
crisis to go to waste.”

– Rahm Emanuel, White House Chief of Staff

ALP_H_BK_0010 Timing matters. The health industry has demonstrated steadfast
resistance to reforms, but its recently diminished fortunes offer the Obama
Administration an unprecedented opportunity to achieve meaningful change. The
stakes are high, though. The Administration’s health team must not miscalculate
the industry’s goals, or waver from goals that are in the nation’s interest.
The two are very different.

Aligning the forces of reform will be the first challenge. The White House and Congressional Democrats appear to be
to develop a unified reform design. Even so,
the effort is hardly pure. Lawmakers have been receptive to industry influence.
The non-partisan Center for Responsive Politics
reports that, in 2009, health care interests have already spent $128 million on
Congressional lobbying contributions, more than any other sector
The tide now turned, most of that largess has gone to Democrats.

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By the numbers, on single payer the Democrats are wussies

Matthew HoltNow before I explain why I say the Democrats are girlie-men, let me say three quick things.

1. I am not a supporter of Medicare-for-all, or Canadian style, single-payer (or anything primarily based on fee-for-service payment) although they are both clearly superior to the American status quo. (I am in favor of real universal insurance, but that’s different and less limited than just single payer).

2. It’s still only 50–50 that we’ll get any reform this year, and what we will get will basically be an expansion of one of the worst-designed government programs—Medicaid—mixed with some very modest regulation of the worst behavior of the private insurance companies. And with the exemptions to the individual mandate and for small business at best we’ll get to around 95% coverage—and that’s not counting the undocumented immigrants, who are about another 3–5% of the population and who will still get care and thus still have to be paid for somehow. And the likely Kennedy/Baucus compromise plan has no sustainable insurance payment structure that I can see.

3. The data is a little murky and all sides kinda cheat with polling data (and bankruptcy data too).

But imagine for a moment that Dick Cheney & George W. Bush had 60 votes in the Senate, a disgraced  opposition, and carte blanche to do what they liked because of a real national crisis (In other words a much better political situation than they faced in 2001 & 2003).

And imagine that there was a policy that their party’s supporters overwhelmingly favored.  Do you think for a moment that they’d be looking for compromise even if what they were doing was egregiously and clearly wrong in both terms of public policy and fairness? For instance, cutting tax rates on dividends to less than half what poor suckers who work for a living have to pay, even though the benefits went largely to millionaires and billionaires. Or even worse eliminating estate taxes, when the benefits went only to millionaires and billionaires.

Actually we don’t have to imagine. We know what Cheney/Bush did. They passed the legislation they wanted, and damn the rest of us. And then did it with way less political clout than Obama has—Bush didn’t even win the election after all in the way most of us understand (err…by getting more votes than the other guy).

Now imagine that there’s a policy that polls show at least 35% and (depending who you believe) perhaps up to 60% of all Americans want, and that the same polls show that a vast majority of Democrats want it. And of course Obama’s political situation is way stronger than the Cheney Administration’s was.

In that situation and if they had a different political philosophy, wouldn’t the Cheney Administration just ram through single payer?

So by the numbers, in not even considering the single payer option (not even Kennedy’s plan comes close), the Democrats are proving themselves to be wussies.

CODA: I changed one letter in one word of this piece so that the humorless crowd in the comments didn’t detract from the real offensive stuff going on here–50 million un and under-insured with no political will to do anything serious about it. But if the comments don’t make sense, my original defense is in there too.

MedPac on Steroids

I’ve long argued that Medicare reform will pave the way for healthcare reform, and that the Medicare Payment Advisory Commission’s (MedPac’s) recommendations could serve as a brilliant blue print for overhauling Medicare.  (Also see our Century Foundation report on Getting More Value From Medicare).

Now President Obama appears to be backing a proposal that would empower MedPac to realize its vision for reform.  Earlier this week, in a White House meeting with Senate Democrats, the president  reportedly “went out of his way” to mention a bill, introduced by Senator Jay Rockefeller ( D-W.Va)  that would move decisions about Medicare benefits away from Congress, by turning MedPAC into an independent executive agency.  Currently, MedPac is an independent panel that advises Congress. It has no formal power. But under Rockefeller’s bill it would be able to implement its recommendations and fund policy initiatives.

Wednesday afternoon, the White House announced that the President has gone a step further by releasing a letter from President Obama to Senators Max Baucus and Ted Kennedy.  The letter extends the remarks that the president made yesterday, which came close to endorsing Rockefeller’s bill. Writing to Kennedy and Baucus, the  President indicated that the administration could find another $200 to $300 billion for health care reform, linking that proposal to “giving special consideration to the recommendations of the Medicare Payment Advisory Commission” (MedPAC), “a commission,” he noted, “created by a Republican Congress . . . Under this approach,” the president continued, “MedPAC’s recommendations on cost reductions would be adopted unless opposed by a joint resolution of the Congress. This is similar to a process that has been used effectively by a commission charged with closing military bases, and could be a valuable tool to help achieve health care reform in a fiscally responsible way.”

These savings,  he added, “will come not only by adopting new technologies and addressing the vastly different costs of care [in different parts of the country], but from going after the key drivers of skyrocketing health care costs, including unmanaged chronic diseases, duplicated tests, and unnecessary hospital readmissions.”

Giving MedPac the Authority to Take the Politics Out of Fees for Doctors & Hospitals

Under Senator Rockefeller’s bill, MedPac would have the authority to set reimbursements for doctors and hospitals.  As Rockefeller explained in a recent Senate Finace Committee meeting:  “I think that [this is] the best way to take politics out of all of this is to take Congress out of the setting of reimbursements for doctors under Medicare and Medicaid and for hospitals, because there  is a group of 17  . . . completely dispassionate people,” who could do this, Rockefeller explained, referring to MedPac.

“And I think one of the [reasons] you have your $700 billion of wasted money every year,” Rockefeller added,  “is the fact that there are too many political judgments made because there’s too much lobbying and Congress can — you know, unless they’re all health care experts, can fall victim to that. So the idea of MedPAC having the power to set those fees, reimbursement fees, to me is enormously attractive, takes politics right out of it and takes Congress right out of it.”

At the hearing, White House budget director Peter Orszag indicated circumspect support for Rockefeller’s bill: “Your idea of — I think we’ve referred to it as  MedPac on steroids, or a much more powerful role for a body that is widely respected– is one approach.”

What Exactly Does MedPac Recommend?

Until now, most reform advocates have ignored MedPac. The reports that the independent advisory panel issues in March and June of each year are long.  They are dense with detail. And they are very, very smart. The commissioners  understand that health care quality could be higher if we spent less on care.

They have digested the Dartmouth research revealing that when patients in some parts of the country receive more aggressive and more expensive care, outcomes often are worse.  They realize that doctors and hospitals should be rewarded for the quality of the care they provide, not the quantity.  As HealthBeat has reported, they know that the fee schedule that Medicare now follows favors specialists while underpaying primary care physicians,  and they have suggested re-distributing Medicare’s dollars “in a budget neutral way”– hiking fees for primary care while lowering fees for some specialists’ services. They have pointed out that some very lucrative procedures appear to be done too often, in part because they pay so well. The Commission has advised targeting these procedures and comp ring them to alternative treatments—just in case a less expensive approach might turn out to be more effective (and not as risky for the patient), as pricier, more aggressive treatments.

Finally, MedPac notes that some hospitals actually make a profit on Medicare’s payments. This is because these hospitals are more efficient: patients typically spend fewer days in the hospital and see fewer specialists. There are fewer readmissions, And generally, outcomes are better. MedPac suggests that when private insurers pay hospitals more, they may simply be rewarding less efficient hospitals for lower quality care. (And of course, private insurers pass those higher payments along to their customers in the form of higher premiums.)

MedPac goes beyond looking at how we pay providers.  Investigating Medicare Advantage, it has described the care that private insurers are providing as somewhere between “disappointing” and “depressing.”  Taking a look at the boom in hospital construction, MedPac noted, in its March 2008 report that “much of the added capacity is located in suburban areas and in particular specialties, raising the possibility that health care costs will increase without significantly improving access to services in lower income areas”. (Here, I can’t help but think about the current controversy over whether Hackensack University Medical Center should be building a new for-profit facility in a nearby suburb.)

As for the drug industry, in its June 2008 report to Congress MedPac observed that “researchers have shown that bias in industry-sponsored trials is common.” Because we lack disinterested, “evidence-based” information about new products, MedPac noted “we do not know which treatments are necessary for which types of patients. Guidelines do not exist . . . to delineate how much care is typically needed . . . and when patients are unlikely to improve with additional treatment.” In the same report, MedPac cast a cold eye on just how quickly we adopt bleeding-edge medical product and procedures to treat “most common clinical conditions” without “credible, empirically based information” to tell us “whether they outperform existing treatments and to what extent.” In other words, we need unbiased comparative effectiveness research. Those who make a profit on new products and procedures should not be involved.

These are exactly the radical but truthful recommendations that would make any well-paid health care lobbyist shudder.  No wonder the Bush administration ignored MedPac’s advice for eight years.

Now, a new White House is taking MedPac’s recommendations to heart. And Congressional leaders also seem to recognize the link between Medicare reform and national healthcare reform.  In April, HealthBeat reported that Senate Finance Chairman Max Baucus had declared that Medicare would become “the big driver” behind national health reform. Now, it’s becoming clear what Baucus meant.

Maggie Mahar is an award winning journalist and author. A frequent contributor to THCB, her work has appeared in 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 healthcare system, and the increasingly influential HealthBeat blog, one of our favorite health care reads and where this piece first appeared.


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