Wednesday, October 14, 2009


I guess it’s pretty clear that the big players in health care haven’t been touched yet by health care reform. I don’t think they will be. I think I have to retract my triumphant “I told you so” about how the stars were aligned to take down the big players. Not so fast.

• Pharma – they will make more money than ever, substituting brand name for generics in Medicare Part D, under the guise of giving up $85B.
• Health insurance companies will get millions of new subscribers and even as they have to take all comers and cannot use rescission of policies as a profit weapon, their competition with each other will be quite muted, and their policy charges unregulated. They will make money, let’s not worry about that.
• And most of all, hospitals. No changes at all. You don’t even hear anything about them. All the patients who come in who were previously “uncovered,” are now “covered.” They pay. Whatever the hospital wants to charge. The only difference from the past is they will get paid. They will get paid. They will not change their rates, they will not change their behavior, they will be in an improved negotiating position vis-à-vis the health insurance companies, because there might be more of the insurance companies to negotiate with – advantage, hospitals, because they will now be able to threaten not to contract, and make it stick. If there is a public option? Probably even then.
• Medicaid. Slightly increased number of patients “covered.” But we know that “coverage” doesn’t equal “access.” In other words, there is a provision in HR 3200 to raise the payments under Medicaid to 100% Medicare in three years. The Senate Finance bill has nothing in it for raising Medicaid payments. Nothing. How are patients going to find someone to serve them at those rates? Not going to work. The old legislative trick – claim “coverage,” but don’t pay for it, so the poor will get screwed and so will those who serve them.
• Cost control. Hard to find it.
• Help for me, a primary care doc negotiating contracts with the insurance companies and trying to get paid as they do the same things to me that they have done to patients for so long. No change in this situation.

So, should we be negative? I don’t know. There are positives. Coverage will certainly be increased, the logjam will be broken for health reform, and progress will be made by fits and starts. I don’t believe in the eventual efficacy of the technology assessment institutions, etc. Maybe something, but not major. The academics will win; they will get their money for “research.”

Doctors? Not much in it for us. The big so-called win in HR 3200 is abolition of the supposed decrease of payment that is threatened every year by the formula, but which never sticks. The Senate Finance bill keeps the provision in to meet financial standards of budget neutrality, but it’s a fraudulent ploy by the Democrats, because it never can stick – 29% reduction in fees that already repels many from accepting Medicare? No one believes that.

And as for rebalancing primary care and specialties? Don’t bet on it, even if the MedPAC becomes an organ of the executive with diminished congressional input. The same forces will rule, hearts and bones and procedures will rule, and primary care will continue as before.

The major needs of health reform involve reorganization of institutions, maybe as has been suggested with accountable organizations, maybe not. It’s true that the insurance companies play lots of games and are very profitable, but where is the origin of it all? It’s the hospitals, where 35% of the heath care dollar goes. Something needs to be done in restructuring. If this is a step in that direction, it sure seems like a baby step.

One thing that could really make a difference, however, that would be simple technically, although difficult politically, since money owns so much of the political system. That would simply be – no not the public option, although I do think that would be good – but the Wyden Amendment. The Wyden Amendment says that the HIE is open to everyone. That includes if patients are employed by corporations, midsize companies, big companies, etc. This would bring competition, real competition, to the field. In my little practice with 120 employees, these employees would be able to choose plans freely, instead of being trapped into whatever plan I can muster for them, with restricted choices, more money than they and we ought to pay, etc. Just give them the same break that some guy off the street with no corporate plan gets, give the field some competition with some rules, and things would be a lot better.

Then we can get going on the hospitals.

Budd Shenkin

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