By ROBERT LASZEWSKI

If you carve a huge chunk of revenue out of Obamacare and shift more subsidies to the middle class it should not be a surprise that the lower income folks will pay the price

The Congressional Budget Office (CBO) has estimated that 14 million  people would lose coverage in 2018, 21 million in 2020, and 24 million in 2026 if the House Republican plan is allowed to significantly amend the Affordable Health Care Act (Obamacare).

In my last post, I called the House Republican bill “mind boggling” for the negative impact I believe it would have on the number of those uninsured and the viability of the individual insurance market. Guess the CBO agrees with me.

The CBO’s report came after the Brookings Institute estimated 15 million people would lose Medicaid and individual health insurance coverage at the end of ten years under the Republican plan. The arguably more business oriented S&P Global estimated between 6 million and 10 million people would lose coverage between 2020 and 2024.

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by JOHN MORROW

Call it what you want, disruption or evolution, but when two of the largest for-profit hospital chains, HCA Healthcare and Tenet Healthcare, and one of the largest insurance intermediary services companies, Optum (part of UnitedHealth Group), invest billions of dollars in capital for building new care settings, everyone should take notice. From freestanding ambulatory surgery centers (ASCs), to urgent care centers, to retail pharmacy-sponsored clinics and employer co-located clinics, the disruption of care delivery is all around us.

How does General Community Hospital compete with Walmart, CVS and Walgreens (retail clinics)? How does it compete with Urgent Care Centers? How will it compete with freestanding ASCs? How does a hospital stop consumers’ desire for savings and convenience? How does it stop physicians’ own desire for convenience and efficiency? This is the disintermediation of hospitals in a very big way! General Community Hospitals can zero base care, but they need to have answers more in line with a consumer retail operation than those of a charity. How many product lines does a focused factory operate?

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By PAUL KECKLEY

Last Monday, as promised, House Speaker Paul Ryan fulfilled his pledge to offer up the GOP’s plan to replace the Affordable Care Act. 

In reality, America’s Health Care Act (AHCA) is not a new plan. Rather, it’s an updated version of the “Restoring Americans’ Healthcare Freedom Reconciliation Act of 2015” that passed the 114th Congress October 23, 2015 before being vetoed by President Obama. Surrogates for this plan are quick to point out that their Repeal and Replace effort also encompasses administrative orders from HHS Secretary Tom Price, executive orders from President Trump and legislation to be passed through regular order (requiring 60 Senate votes). But the AHCA is unquestionably the first and most important of these elements: it signifies to Repeal and Replace proponents that the new Republican majority intends to make good on its promise to dismantle the Affordable Care Act. 

Its status is this: the AHCA cleared the House Ways and Means and Energy and Commerce Committee votes last week. Later today, the Congressional Budget Office will render its assessment of the plan’s financial impact and its underlying assumptions about possible changes in insurance coverage. After passage in the House, it will go to the Senate where it will be modified and likely passed along party lines under the restrictions of reconciliation. Its sponsors hope it will be law within six weeks as their initial phase of Repeal and Replace. 

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By PASCAL LARDIER

We very recently supported the new EU-funded project eHealth Hub in surveying over 300 European digital health SMEs. I expected some of the results but got a few surprises too I wanted to share.
82% of EU startups stated revenues under 100K€, including 39% of them still being pre-revenues:

So I guess they are right when they say digital health is still young in Europe. I hate hearing it because reviewing Health 2.0 Europe demo applications year after year, it is clear that the maturity of the solutions is definitely up. I can only conclude that the supply side is maturing faster that the demand side – whether we are talking of consumer or professional facing solutions.

I was also surprised to see that most SMEs are working on B2B or B2B2C solutions:

Surprised because we always benchmark our investment flow to the US’, but the lion’s share of the deals is still going to B2C solutions over there. We tend to blame it on investors, but maybe our investment flow would be a lot greater if only that ‘C’ was stronger and Europeans were ready to open their wallets and become health consumers?

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By BRIAN JOONDEPH, MD

Cancer is a devious and devastating disease. All it takes are a few bad cells to grow uncontrollably, first destroying organs, then an entire person. It can also lie dormant for years after supposedly being cured, then at some moment awaken from its remission slumber to resume its search-and-destroy mission. Even if cancer is controlled, it can still leave its victim in a weakened or debilitated condition, a shadow of its former robust self.

What if the Affordable Care Act, affectionately known as Obamacare, was unintentionally infected with cancer back in 2010 when it was voted into law? What if the cancer could be reactivated at any time? After all, we had to “pass the bill to find out what’s in it” according to one of its proponents. Surprise, the dormant cancer is already in the law.

Ideally, cancer is removed from the body entirely. A true cure. For Obamacare, this would mean repealing the bill entirely. Despite campaign promises of repeal, legislatively, this is a nonstarter. This is worth a brief review as many think a simple repeal bill from the House is possible.

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By BLAKE ASHBY

The conversation our country is having about healthcare right now is not honest. It’s not just the Republicans, the Democrats are just as dishonest, in a different way. Republicans talk about government death panels denying care. Democrats talk about insurance company death panels. Both positions are intellectually dishonest. Both Republicans and Democrats know that a part of insurance is drawing boundaries around the care that would be paid for by the group.  Any care outside that boundary doesn’t get paid for.  You can frame it any way you want, but this is a critical part of any insurance. 

Insurance, whether healthcare or auto, is a risk pool.  A group of people pay into the pool and hope they don’t have to use it – hope they don’t have a wreck on their car, don’t have to go into the hospital.  Those few that do have to use it consume most of the money in the pool – the risk pool spends tens of thousands on the people that have serious car accidents, or hundreds of thousands of dollars on someone that has cancer.  That means that everybody else in the pool helps pay for the costs of the unlucky few.  Healthy me pays for the costs of tripped and broke his leg Bob.

The worst part of the Affordable Care Act that nobody talks about is its removal of caps on annual and lifetime awards.  There is no limit to the risk that the risk pool assumes.  Before the ACA, an annual cap for an insurance plan might be $500,000, with a lifetime cap of $2 million to $5 million.  Now those caps are gone – there is no limit to the amount of money a risk pool has to pay to keep someone alive.

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By SAURABH JHA, MD

That the appointment of Scott Gottlieb to head the FDA has elicited a decidedly mixed response is a good thing. I fear consensus as much as the late Christopher Hitchens loved dissent which, he believed, was an indicator of a healthy democracy, which means that rather than facing the morgue, the US might be going through her healthiest days in these times.

Gottlieb has served on the boards of industry, and earned a nifty pocket money doing so. Detractors argue that he’s unfit to head the FDA because of his financial conflict of interest (FCOI). I will not revisit the arguments for and against physician’s FCOI with industry, because all arguments for and against have been made, and it’s unlikely that anyone’s mind will change with new evidence or new arguments. Suffice it to say that both sides have plausible arguments, and we’ll never know the truth, because to know the real impact of physician’s FCOI with industry we need parallel universes with everything held constant, except the degree of physician ties with industry, and measure the net benefits to society in terms of morbidity, mortality, drug prices, and innovations.

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By NIRAN AL-AGBA, MD

Transparency – including price, quality, and effectiveness of medical services is a vital component to lowering costs and improving outcomes.  However, it is imperative transparency go hand-in-hand with financial incentives for patients and consumers; otherwise the quest will be in vain.  The single best way of reducing costs while not worsening health outcomes is to redistribute resources from less cost-effective health services to more cost-effective ones.  Americans are extremely uncomfortable with the idea of making decisions based on cost but we must become fluent in the language of cost and more comfortable making decisions based on price information for healthcare expenditures to stabilize. 

Legislators in more than 30 states have proposed legislation to promote price transparency, with most efforts focused around publishing average or median prices for hospital services. Some states already have price transparency policies in place. California requires hospitals to give patients cost estimates for the 25 most common outpatient procedures. Texas requires providers to disclose price information to patients upon request. Ohio passed price transparency legislation last year; however a lawsuit filed by the Ohio Hospital Association has delayed implementation.  The cost of a knee replacement is $15,500 at the Surgery Center of Oklahoma, whereas the national average is $49,500. 

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By JOE FLOWER

This is a letter I sent to Gary Cohn, appointed by President Trump to head the National Economic Council and, among other things, come up with a plan for reforming healthcare. Formerly president of Goldman Sachs, Cohn may be a wizard at finance, but healthcare economics are wildly different and famously opaque. So I thought I would help him out.]

Subject: A brief on healthcare economics. (8 minutes)

 o Why healthcare economics are different.

 o Why the ACA is failing.

 o What would work.

Who I am (credentials): Independent healthcare author and analyst since Jimmy Carter’s administration. Speaker, consultant across the industry at all levels, including insurers, hospitals, device manufacturers, employers, Veterans, pharma, World Health Organization, Department of Defense. Look me up: ImagineWhatIf.com. Books on Amazon.

Core problem: The core problem in healthcare reform is the actual cost of medical care.

o Healthcare in the U.S. by any measure costs about twice what it should.
o Medical prices are completely disconnected from the cost of production.
o Few medical providers even know the true cost of ownership of their products.
o By a number of analyses at least one third of that (well over $1 trillion this year) is waste, paying for things that we don’t need and that don’t help.
o Solving just the federal part of this would completely wipe out the deficit.

Trying to “take care of everybody” will always be impossible politically and economically as long as healthcare costs twice what it should and wastes trillions of dollars.

Solvable: This is a solvable problem. Change the relationship of the sector to its true customers by shifting the payment structure, prompting business model innovation. Stop paying for waste, and $1 trillion/year in unneeded overtreatment will disappear. Prices will drop to something like a true market price. This will not happen overnight, but it could happen over five years with vigorous implementation.

Why does it cost so much?

No price signals: The structure of the U.S. healthcare market since the early 1980s has made it opaque to price signals. Customers in healthcare ask a different question than customers in most markets. Whether hospitals (as customers of suppliers) or individuals needing an operation, healthcare customers mostly don’t ask, “Can we afford it?” Or even, “What’s the best value for the money?” They ask, “Is it covered? Can we get reimbursed for this?” And the reimbursement or coverage is set by complex non-market mechanisms that in most parts of the market are themselves opaque to the customer. So there is no real customer and no real price signal in most relationships throughout the market.

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