I have been asked by 20% of my readership (my friend Bob) to comment on Atul Gawande’s article on the cost of medical care in the current New Yorker. Besides being a great writer, Gawande is a great reporter. He went to McAllen, Texas, on the Mexican border in South Texas, Hidalgo country, one of the poorest counties in the country – where I was many times in 1968-70, when I was in the Public Health Service.
Statistics show that medical costs in Hidalgo County are the highest in the country, and he wants to find out why. He converses with lots of people and finds the answer to be that the culture of the medical community has become the culture of making money. Doctors look to their bottom line, and do everything they can for the patient preemptively, if it pays. [The old story, no doubt apocryphal, is that a cardiologist presented figures that showed that a newborn’s VSD (hole in the heart) generally closed naturally by 18 months, wherupon a cardiac surgeon went to the microphone and said, ”See? I told you. We have to get them early!”]
I recognize this thread in modern American medical culture; it exists in places right here in the East Bay. In Hidalgo County it has infected the greatest part of the culture and that’s why the whole county is high cost. In other areas the same culture exists but isn’t so predominant, perhaps; in some areas it is very little in evidence. But taken as a whole, Gawande says, this is the prime mover for the high cost of medical care in the US.
He is guided in his perceptions by the findings of the Dartmouth Group, which for over 30 years, starting with Jack Wennberg, has worked brilliantly on “small area variations” in medical care costs and frequencies of procedures. They showed initially that in small areas centering around different hospitals in Vermont, the rates of such procedures as tonsillectomy were very different. The differences could not be accounted for by different rates of illness, and the outcomes of such procedures were not noticeably different in different areas. In other words, more treatment might not have resulted in better health. It is true that the outcomes measures were crude and not very sensitive, so it is possible that the patients operated on got better faster, etc. But probably not significantly. The Dartmouth group concluded that the driver of procedures was the number of specialists who did this operation in the different areas. More surgeons equaled more operations.
There are other less quantitative studies in the literature of medical care sociology that show that small groups, often centered around hospitals, get to know one another and work into a culture where they get used to referring to each other, and treating diseases certain ways. Some of the drivers of behavior might be money, as in Hidalgo County; others can be other factors not economically related, such as friendship, not blowing the whistle on incompetence, etc.
In more recent years the Dartmouth Group has shown the stark differences in Medicare expenditures all throughout the country – Miami is very high, as is the UCLA area; Minnesota and North Dakota are quite low. In all these areas we can’t see differences in the health of the population; in all probability the high-effort and high-cost areas have no worse health before medical care, and no better results afterwards. In fact, given the predictable side effects of some treatments, it’s probable that the high-cost areas get worse results.
In identifying culture as the problem, Gawande says that simply changing payment mechanisms won’t be effective, because doctors and others will always find ways to game the system. What is needed is a change in culture. He identifies salaried groups such as Mayo, Geisinger, and the Marshfield Clinics as mechanisms that can enforce a culture. (I don’t know about them personally, but I do have some connections to Kaiser, which he also mentions, since it is in my Northern California area. To call their care excellent is not accurate. It does well on measurements, but I hear far too many anecdotes of unmeasured incidents of poor care to call Kaiser excellent. It has excellent propaganda.) He says that the forces within medicine can do this, but that insurance companies can’t. He says that this is the route to salvation in American medicine.
I yield to no one in my admiration of Atul Gawande, a brilliant observer, writer, reporter, and thinker. And his analysis is certainly right in a way. But it is not complete, and in its incompleteness, it might be somewhat misleading. Here is what I think.
Even the great have weaknesses, and sometimes their weakness is that they are so great. They believe unconsciously that if they can do it, everyone can do it. It’s like me and my natural forehand in tennis. I just can’t understand that others can’t do it the way I can, it just seems so natural. Gawande comes from a very elite hospital based culture at the Peter Bent Brigham Hospital in Boston. I’ve been in that culture as a student at Harvard Medical School and I know it. Getting to the Brigham is a very uncommon event for a doctor – the best of the best. Being so elite and excellent, they can psychologically afford to be quite pure. They just don’t need the money to regard themselves as wonderful. They can look at their medical excellence and their purity of motives and criticize others who don’t measure up. They can successfully buck the American culture of financial accomplishment and hold themselves to a different standard. And they can’t understand how others can’t do it, too. Or at least aspire to it.
But look at those who have less elite abilities. People who had to work very hard to get into medical school to begin with, and then worked very hard to graduate from a mediocre school that they barely got accepted to, and then continued to work very hard throughout residency because they are really not that smart. They succeed in becoming doctors, but they know they won’t excel in the eyes of their peers. By definition, we are talking about the majority of doctors.
Induction into the medical ranks is powerful, and the code of ethics is meaningful. Many will adapt well to the priestly function of medicine not only in the way they treat patients, but also in their self-regard as men or women of the profession. As I look around me in my own professional world I see many doctors, even most, who fit in here, as members of the chosen.
Yet inevitably, others will be ambitious to succeed in the eyes of the world, and the business people they associate with. These doctors are not going to be seduced by the siren song of excellence. That they compare their worth to other individuals by comparing their financial assets is understandable. To get these doctors to join up and take salaries and work together will not be easy. The proffered Gawande solution won’t work with them.
A second objection to grouping doctors is simply that not everyone can stand being in a group. Groups can be oppressive. People who prize initiative will not want to be in initiative-suppressing groups. And groups are not necessarily excellent – the tyranny of the mediocre is often prevalent. Similarly to these group-avoiding doctors, many patients avoid large groups, understanding intuitively that in a large institution, incentives for individual doctors are inevitably led away from serving the individual sensitively. Geisinger has a way of integrating small groups of doctors somewhat, but the others don’t. Again, a prescription of a big group is not going to fit everyone.
A third objection is that Gawande is a doctor and thus sees things from a doctor’s point of view. He sees that decisions of doctors trigger events with patients. No patient goes into the hospital without a doctor initiating the admitting order. No MRI gets done without a doctor’s order. This is true. Other health analysts have seen the same thing and said, if only we could intervene at this point! What if doctors were aware of alternatives to their activist decisions? Or, what if we could outlaw such decisions? The current recommendation is for assembling a panel of experts to determine what is best practice and forbid payment for non-standard interventions.
This is OK as far as it goes. But total expenditures = volume x price. Gawande looks only at volume. What about price? Typically, a trip to the operating room might pay the surgeon $750 and the hospital $25,000. Why not put the hospitals in competition on this? They are so, so guilty of enormous inefficiencies. We could count the ways. What about the price of MRI’s and other studies? We could continue the same rate of services and save cost if only we put them in competition and got the price down.
It is truly amazing to me that all the prescriptions for health care reform do not talk about aggressive steps that could be taken here. I don’t know why. It is so clear to us in practice how profligate hospitals are, how poorly managed, how manipulated by nursing and service unions, and how they just pass on costs to consumers. Why, oh why are they not on the block?? Why is price not an issue?
One final point and I’ll quit for today. Gawande points to the integrated groups as the answer. Conventional wisdom also tells us that managed care worked from 1993-2000 but then failed as consumers and doctors revolted. In fact, this widely acknowledged fact ain’t exactly so. The East Coast version of managed care is poor. This is the version whereby the doctor contracts directly with the large insurance company. The large and distant company cannot manage care well, cannot determine which procedures to approve, and how to structure care.
The West Coast managed care version, however, has worked to a certain degree, and could be built upon to work even better. This is called the IPA, or Independent Physician Association model. In this model, described in my 1995 JAMA article, the physicians are contracted by an intermediate organization, the IPA, which then contracts with the insurance companies on their behalf. Insurance companies can do diddly in medical care administration, but IPA’s can do a lot, coordinating care, and most importantly doing exactly what Gawande wants done – outlawing procedures that are out of line. (Not they all have done so - many were poorly run, and others were run by their leaders unethically, enriching themselves. But some survive and improve the system.) Gawande could just as well recommend that such organizations be strengthened, and better subjected to competition, by allowing more IPA’s to emerge and compete.
So, OK – Gawande is great and everything he says is true and the medical culture of Hidalgo County and other such counties throughout the USA is to be strongly condemned. But it is only part of the picture. Why reformers don’t focus on the hospitals, where the real money and the real savings are, is beyond me.
Budd Shenkin
Sunday, May 31, 2009
Wednesday, May 27, 2009
Catholics on the Supreme Court
I don't even know if it's well known. If it is, I don't know if it's appreciated. But the fact is, there are five conservatives on the Supreme Court, and they are all Catholics. And now with Obama's having nominated Sotomayor, there will be six total. Six out of nine Justices of the Supreme Court will be Catholic.
That's amazing enough. How did that happen? Talk about changes. How did that happen?
But to me that's not the really amazing thing. The really amazing thing is that no one ever talks about it. That is just so amazing.
How long ago was 1960, when Kennedy made his Dallas speech? Seemed a pretty important thing at the time. Did suspicion of Catholics just disappear after that?
One has to admit that the fact that there are five Catholics on the court, and that they constitute together the powerful conservative bloc, that they all seem very ideological, seems like something people would notice and comment on. I would; I do; I am. Doesn't seem to make much difference. No one seems to have an opinion.
I have an opinion, I've got to say. I think that beliefs and culture have meaning, and I think that even if backgrounds are not determinative, in some cases they fill out a dossier, contribute to a profile. Anyone can be respectful of authority, but no one quite so much as a Catholic. There it is. Catholics who have been reared in the tradition can throw it off, to some extent, but not completely, and if they do, it's like an outer layer. The other part doesn't just disappear. There's some saying that I forget that the Jesuits have, something like give us the boy until age (something), and we have him for life. Something like that. Little as I know about them, I've never met any of them, Alito, a New Jersey Catholic, typifies it for me. And now that I hear more about Roberts, deference to power and authority seems pretty deep in him.
Why don't we hear about this? OK - people think I'm just prejudiced when I say this. Do you think so? I don't think so, but maybe I'm wrong. Maybe it's just coincidence that these conservative men support the powerful over the powerless relentlessly, and are about to vote down Roe vs. Wade if they possibly can, just as their Church teaches and urges and pressures them to do. Maybe it's just coincidence.
I think people don't talk about it because it's not fashionable to recognize differences in populations of different sort. I think prejudice is out of fashion.
But what if it's not prejudice? Were going to have six Catholics on the court, none of whom is apostate, and all of whose church weighs in very heavily against abortion.
Isn't this a hell of a chance to take, nominating another one? Or is everyone right who ignores this, and am I a lone prejudiced person from another era who just doesn't recognize current truth - conventional wisdom, to quote Galbraith, with all that implies.
What an amazing thing is not happening.
Budd Shenkin
That's amazing enough. How did that happen? Talk about changes. How did that happen?
But to me that's not the really amazing thing. The really amazing thing is that no one ever talks about it. That is just so amazing.
How long ago was 1960, when Kennedy made his Dallas speech? Seemed a pretty important thing at the time. Did suspicion of Catholics just disappear after that?
One has to admit that the fact that there are five Catholics on the court, and that they constitute together the powerful conservative bloc, that they all seem very ideological, seems like something people would notice and comment on. I would; I do; I am. Doesn't seem to make much difference. No one seems to have an opinion.
I have an opinion, I've got to say. I think that beliefs and culture have meaning, and I think that even if backgrounds are not determinative, in some cases they fill out a dossier, contribute to a profile. Anyone can be respectful of authority, but no one quite so much as a Catholic. There it is. Catholics who have been reared in the tradition can throw it off, to some extent, but not completely, and if they do, it's like an outer layer. The other part doesn't just disappear. There's some saying that I forget that the Jesuits have, something like give us the boy until age (something), and we have him for life. Something like that. Little as I know about them, I've never met any of them, Alito, a New Jersey Catholic, typifies it for me. And now that I hear more about Roberts, deference to power and authority seems pretty deep in him.
Why don't we hear about this? OK - people think I'm just prejudiced when I say this. Do you think so? I don't think so, but maybe I'm wrong. Maybe it's just coincidence that these conservative men support the powerful over the powerless relentlessly, and are about to vote down Roe vs. Wade if they possibly can, just as their Church teaches and urges and pressures them to do. Maybe it's just coincidence.
I think people don't talk about it because it's not fashionable to recognize differences in populations of different sort. I think prejudice is out of fashion.
But what if it's not prejudice? Were going to have six Catholics on the court, none of whom is apostate, and all of whose church weighs in very heavily against abortion.
Isn't this a hell of a chance to take, nominating another one? Or is everyone right who ignores this, and am I a lone prejudiced person from another era who just doesn't recognize current truth - conventional wisdom, to quote Galbraith, with all that implies.
What an amazing thing is not happening.
Budd Shenkin
Saturday, May 23, 2009
Health Care Reform (5) - and stories in the exam room
On my American Academy of Pediatrics listserve, one contributor recently said, hey you guys, how come everyone is talking about minutiae, when the biggest deal of our professional lifetimes, a real point of inflection, is coming down the pike? I took this as an invitation an came up with the following post.
The endpoint of the post is that not a whole lot is wrong with primary care pediatrics in the current system that enhancing pay would not cure. There are lots of other things that can be done, but most all of them are curable by money and some regulations - for instance, maybe the Medical Home concept could be pushed and paid for and better and more efficient ways of following chronic disease could be fostered. But we don't have to do anything fancy.
I would also now add this: it's important to distinguish pediatrics and adult care. There are significant difficulties with adult care, some of which have led to the Retail Based Clinic movement. That is, adult primary care practices are relatively insensitive to urgent patient needs. A pediatric urgent call will result in a same day visit; and adult call will result in a later in the week visit, which is not responsive to the problem and the patient, really.
There was a recent article by two Harvard B School professors proposing (yet again) that more midlevel practitioners be used for "simple" primary care problems, and extensive work-up protocols in Electronic Medical Records be used by primaries to extend their reach into what are currently specialty areas. Problem with this - this is not where the problem lies! (See below).
Also, it is true that we have to wonder if our current primary care system uses very extensively trained clinicians for quite mundane problems, and can we afford this, and is it wise, especially since other countries don't do this much with pediatrics, although they do with primary care in general. Answer - yes, it is wise and yes we can.
Here's my answer. One day last week I had three patients in my truncated afternoon schedule. The first was an infant of a new mother who had been my own patient as a child. She is 20 years old, African-American, and brought the father of the baby with her. She has turned into a quite mature young woman. She doesn't get the support she hoped for from her own mother, and she and the father are not together any more. But she said that she had asked the father to come to the doctor with her because she wanted him to be part of her baby's life. She remembered that her own mother had often been angry at her father and had prevented him from coming to the house and seeing his daughter. She didn't want that replicated. Somehow, this routine visit was elevated in her mind to an important family event. I was ever so flattered and tried to live up to her expectations by asking the right questions, encouraging both mother and father, etc. Could a midlevel have done this? Maybe. But not the way I could, I'd say. And I come cheap, I'm primary care.
The second patient was a 14 year old boy I was seeing in followup, with his mother. He is a marijuana user and seller, is with the wrong crowd, is recently failing in school although he is sufficiently bright, his father is an alcoholic, and his mother moved out of the house some months ago. Tension is rife, his younger sister is following his mother's lead and rejecting the father. What is this boy to do, and what am I to do with him? I support the mother as I see them together, I help him think about his summer and positive things to do when he will be in a cast since he has a non-junction healing fibular fracture that needs an operation, and then with him alone I talk with him about how he is doing. I tell him that his job is to keep himself together, and that this is the best thing he can do for his family. I am his friend and support. His mother tells me that he will only come to see me, that he rejects other counselors. What do I do that's so special? I don't know, but I've known him for a long time, and her, and somehow I have meaning to them. I hang in there with them. And I'm not very expensive.
The third patient was a two year old son of two physicians who has been slow to walk and slow to talk. We have identified both problems and elected not to do much with either. I think we referred him to ortho for the walking problem, "just to be sure," and I think I recommended a little speech and language action just to juice up the development. He's coming along OK. My chief contribution, again, is support. They trust me as someone who has seen a lot of kids. Because of their relative sophistication, I think they need to relate to a doctor, not a midlevel. And again, my chief attribute is not to panic and to watch and wait and support. And again - I'm cheap!
I have to tell you also that as a doctor these three cases each give me enormous satisfaction. I think I can help each one of them, each in a different way. And I think I bring my total life experience to bear on each case, and try to understand them as fully as a I can. The smarter I am, the better they have it. I'm not going to be replaced by a midlevel or a computer protocol anytime soon.
So, in this super-long post - sorry - here is what I wrote about health care reform, in response to the post by pediatrician Mike Kuduk:
>>Mike, thanks so much for your recent postings and your help in keeping the list serve up to date. I agree, this epochal reform deserve our full attention.
You wondered in your previous post if any of us had ideas as to where our interests lay here. At the level of generality of the current negotiations, it might be hard to tell, and we don't know what the actual points are under negotiation, except for what is publicly available. I suppose some of our governmental relations people know to some extent - maybe - but I understand that this ever-changing data would not necessarily be shared with us, since we are not the governmental relations or finance committees. So, it's hard for us to know what is exactly at stake specifically for us.
Some things should be evident, however. The "drunk under the street lights" phenomenon will be at work, as it always is. (I meant to post on this in relation to the Yahoo comments from the Harvard B-School guys the other day, but now I can't find it.) That is, it is so easy to attack primary care. Hey, just raise the deductible, just lower the RBRVS or don't raise it, just insist on current Medicare rates and no higher, just reimburse vaccines at actual straight purchase price cost and you have absolutely stripped primary care pediatrics bare. It's easy to do!! The problem is, this this not the problem. Primary care pediatrics is easy to attack, but this is not the source of high medical care costs -- just the opposite. But like the drunk, it's tempting to find a fix here to a problem that doesn't exist.
Where does the problem exist? Insurance costs and overhead - everyone recognizes this, and just deleting the cost of underwriting will help some of this. Fighting with providers not to pay them, this costs money to the system, to employ all the no-saying clerks, but I am sure non-payment save them money. Of course it costs the whole system money, since the public's money is already in the coffers and its just a question of distribution, to the providers or to the insurance companies, so it is a systematic cost. One way to deal with this is just pay and don't negotiate - the Medicare way, I guess. But that is pretty draconian. So I don't see an immediate fix for this in altering the behavior of insurance companies. The main fix will be in reducing underwriting, I guess. Wish I knew more about this.
Specialists cost a lot to the system, in what they take and what they order. Again, how will this be fixed? A Commission of Effective Practices? I don't think this is the major problem, actually - it is the "work it up until every possible thing has been done" syndrome. There are two basic ways to attack this problem - regulate what procedures work and which won't work (back surgery), or give new incentives, which might work. But it's very hard to capitate, which would be the "incentives" approach. The Dartmouth solution - give the money in a DRG way to a hospital and affiliated physicians for each incident of illness - has been and will be rejected by docs. So, I really don't know how they will rein the specialists in. They should, but it seems hard to do.
Pharma costs a lot - I'm sure there will be some savings there with competitive bidding.
Hospitals - now to my mind, this is the biggest drain on the system, just look at bills and look around you on rounds for what people are doing and not doing and look at the exorbitant staffing at the administrative level, yet we hear almost nothing about these costs. In the past virtually nothing has worked and it's amazing to me how little we hear about reining in hospital costs in the current proposals. These institutions just consolidate and charge and plead penury while gobbling up more and more and economizing not at all. There is a lot in the literature about how lots can be done - see the Intermountain experience - but that the savings in the past have been passed on to insurance and the institutions that have done the savings just see their payments decline. That sounds pretty familiar. I hope some real solutions will come here, but I haven't noticed any.
Primary Care Pediatrics
OK - so what I'm saying is that reform needs to go where the big money and the big problems are, and primary care needs to be nurtured. Seems to me that this needs to be our mantra. Search in the shadows where the money and waste are, not under the street light where primary care lies bleeding!
There have been some proposals that the Feds need to mandate that Medicaid payments meet a national standard, and that some states (like California, for instance) cannot drop so low as they are. That is something we should get behind.
It looks like, surprisingly to me, that there may actually come into being a BGP (Big Government Plan) that will compete with the private plans. It will be funded only by premiums similar to other plans, which is only fair. It will have to be regulated further. Russell and others have been rightly suspicious on this listserve that it will provide un-negotiable provisions, and will use monopoly tactics to drive the private plans out of operation. I yield to no one in my suspicion of governmental operations, and the ability of government to be as undeferential as the worst Commie government practices we have heard about. But - if government sees the need for primary care, would it be possible that they would lead the way with large payments to primaries, so that we made it up to the standard of the British NHS, say? If so, and if the BGP were to capture a large portion of subscribers, wouldn't the private plans have to compete to get us to join their networks? What if the BGP paid us 125% of AWP for vaccines? (I know, dream on.)
So, that's where I'm coming down on what is in our interest. It is widely understood now that primary care is very important for our medical care system, and that it is failing, and that poor payments won't support a decent income. The BGP will need to be regulated. Therefore, part of our governmental efforts will need to be to make the BGP regs favor primary care pediatrics. Nothing fancy, just high payments, low copays and deducibles for primary care, and none at all for kids. Let the fancy stuff be applied to the insurance companies, pharma, hospitals, and specialists. Show me the money.
Please excuse my going on and on. Blame Kuduk.<<
Budd Shenkin
The endpoint of the post is that not a whole lot is wrong with primary care pediatrics in the current system that enhancing pay would not cure. There are lots of other things that can be done, but most all of them are curable by money and some regulations - for instance, maybe the Medical Home concept could be pushed and paid for and better and more efficient ways of following chronic disease could be fostered. But we don't have to do anything fancy.
I would also now add this: it's important to distinguish pediatrics and adult care. There are significant difficulties with adult care, some of which have led to the Retail Based Clinic movement. That is, adult primary care practices are relatively insensitive to urgent patient needs. A pediatric urgent call will result in a same day visit; and adult call will result in a later in the week visit, which is not responsive to the problem and the patient, really.
There was a recent article by two Harvard B School professors proposing (yet again) that more midlevel practitioners be used for "simple" primary care problems, and extensive work-up protocols in Electronic Medical Records be used by primaries to extend their reach into what are currently specialty areas. Problem with this - this is not where the problem lies! (See below).
Also, it is true that we have to wonder if our current primary care system uses very extensively trained clinicians for quite mundane problems, and can we afford this, and is it wise, especially since other countries don't do this much with pediatrics, although they do with primary care in general. Answer - yes, it is wise and yes we can.
Here's my answer. One day last week I had three patients in my truncated afternoon schedule. The first was an infant of a new mother who had been my own patient as a child. She is 20 years old, African-American, and brought the father of the baby with her. She has turned into a quite mature young woman. She doesn't get the support she hoped for from her own mother, and she and the father are not together any more. But she said that she had asked the father to come to the doctor with her because she wanted him to be part of her baby's life. She remembered that her own mother had often been angry at her father and had prevented him from coming to the house and seeing his daughter. She didn't want that replicated. Somehow, this routine visit was elevated in her mind to an important family event. I was ever so flattered and tried to live up to her expectations by asking the right questions, encouraging both mother and father, etc. Could a midlevel have done this? Maybe. But not the way I could, I'd say. And I come cheap, I'm primary care.
The second patient was a 14 year old boy I was seeing in followup, with his mother. He is a marijuana user and seller, is with the wrong crowd, is recently failing in school although he is sufficiently bright, his father is an alcoholic, and his mother moved out of the house some months ago. Tension is rife, his younger sister is following his mother's lead and rejecting the father. What is this boy to do, and what am I to do with him? I support the mother as I see them together, I help him think about his summer and positive things to do when he will be in a cast since he has a non-junction healing fibular fracture that needs an operation, and then with him alone I talk with him about how he is doing. I tell him that his job is to keep himself together, and that this is the best thing he can do for his family. I am his friend and support. His mother tells me that he will only come to see me, that he rejects other counselors. What do I do that's so special? I don't know, but I've known him for a long time, and her, and somehow I have meaning to them. I hang in there with them. And I'm not very expensive.
The third patient was a two year old son of two physicians who has been slow to walk and slow to talk. We have identified both problems and elected not to do much with either. I think we referred him to ortho for the walking problem, "just to be sure," and I think I recommended a little speech and language action just to juice up the development. He's coming along OK. My chief contribution, again, is support. They trust me as someone who has seen a lot of kids. Because of their relative sophistication, I think they need to relate to a doctor, not a midlevel. And again, my chief attribute is not to panic and to watch and wait and support. And again - I'm cheap!
I have to tell you also that as a doctor these three cases each give me enormous satisfaction. I think I can help each one of them, each in a different way. And I think I bring my total life experience to bear on each case, and try to understand them as fully as a I can. The smarter I am, the better they have it. I'm not going to be replaced by a midlevel or a computer protocol anytime soon.
So, in this super-long post - sorry - here is what I wrote about health care reform, in response to the post by pediatrician Mike Kuduk:
>>Mike, thanks so much for your recent postings and your help in keeping the list serve up to date. I agree, this epochal reform deserve our full attention.
You wondered in your previous post if any of us had ideas as to where our interests lay here. At the level of generality of the current negotiations, it might be hard to tell, and we don't know what the actual points are under negotiation, except for what is publicly available. I suppose some of our governmental relations people know to some extent - maybe - but I understand that this ever-changing data would not necessarily be shared with us, since we are not the governmental relations or finance committees. So, it's hard for us to know what is exactly at stake specifically for us.
Some things should be evident, however. The "drunk under the street lights" phenomenon will be at work, as it always is. (I meant to post on this in relation to the Yahoo comments from the Harvard B-School guys the other day, but now I can't find it.) That is, it is so easy to attack primary care. Hey, just raise the deductible, just lower the RBRVS or don't raise it, just insist on current Medicare rates and no higher, just reimburse vaccines at actual straight purchase price cost and you have absolutely stripped primary care pediatrics bare. It's easy to do!! The problem is, this this not the problem. Primary care pediatrics is easy to attack, but this is not the source of high medical care costs -- just the opposite. But like the drunk, it's tempting to find a fix here to a problem that doesn't exist.
Where does the problem exist? Insurance costs and overhead - everyone recognizes this, and just deleting the cost of underwriting will help some of this. Fighting with providers not to pay them, this costs money to the system, to employ all the no-saying clerks, but I am sure non-payment save them money. Of course it costs the whole system money, since the public's money is already in the coffers and its just a question of distribution, to the providers or to the insurance companies, so it is a systematic cost. One way to deal with this is just pay and don't negotiate - the Medicare way, I guess. But that is pretty draconian. So I don't see an immediate fix for this in altering the behavior of insurance companies. The main fix will be in reducing underwriting, I guess. Wish I knew more about this.
Specialists cost a lot to the system, in what they take and what they order. Again, how will this be fixed? A Commission of Effective Practices? I don't think this is the major problem, actually - it is the "work it up until every possible thing has been done" syndrome. There are two basic ways to attack this problem - regulate what procedures work and which won't work (back surgery), or give new incentives, which might work. But it's very hard to capitate, which would be the "incentives" approach. The Dartmouth solution - give the money in a DRG way to a hospital and affiliated physicians for each incident of illness - has been and will be rejected by docs. So, I really don't know how they will rein the specialists in. They should, but it seems hard to do.
Pharma costs a lot - I'm sure there will be some savings there with competitive bidding.
Hospitals - now to my mind, this is the biggest drain on the system, just look at bills and look around you on rounds for what people are doing and not doing and look at the exorbitant staffing at the administrative level, yet we hear almost nothing about these costs. In the past virtually nothing has worked and it's amazing to me how little we hear about reining in hospital costs in the current proposals. These institutions just consolidate and charge and plead penury while gobbling up more and more and economizing not at all. There is a lot in the literature about how lots can be done - see the Intermountain experience - but that the savings in the past have been passed on to insurance and the institutions that have done the savings just see their payments decline. That sounds pretty familiar. I hope some real solutions will come here, but I haven't noticed any.
Primary Care Pediatrics
OK - so what I'm saying is that reform needs to go where the big money and the big problems are, and primary care needs to be nurtured. Seems to me that this needs to be our mantra. Search in the shadows where the money and waste are, not under the street light where primary care lies bleeding!
There have been some proposals that the Feds need to mandate that Medicaid payments meet a national standard, and that some states (like California, for instance) cannot drop so low as they are. That is something we should get behind.
It looks like, surprisingly to me, that there may actually come into being a BGP (Big Government Plan) that will compete with the private plans. It will be funded only by premiums similar to other plans, which is only fair. It will have to be regulated further. Russell and others have been rightly suspicious on this listserve that it will provide un-negotiable provisions, and will use monopoly tactics to drive the private plans out of operation. I yield to no one in my suspicion of governmental operations, and the ability of government to be as undeferential as the worst Commie government practices we have heard about. But - if government sees the need for primary care, would it be possible that they would lead the way with large payments to primaries, so that we made it up to the standard of the British NHS, say? If so, and if the BGP were to capture a large portion of subscribers, wouldn't the private plans have to compete to get us to join their networks? What if the BGP paid us 125% of AWP for vaccines? (I know, dream on.)
So, that's where I'm coming down on what is in our interest. It is widely understood now that primary care is very important for our medical care system, and that it is failing, and that poor payments won't support a decent income. The BGP will need to be regulated. Therefore, part of our governmental efforts will need to be to make the BGP regs favor primary care pediatrics. Nothing fancy, just high payments, low copays and deducibles for primary care, and none at all for kids. Let the fancy stuff be applied to the insurance companies, pharma, hospitals, and specialists. Show me the money.
Please excuse my going on and on. Blame Kuduk.<<
Budd Shenkin
Tuesday, May 19, 2009
Brush with Infamy
So, last Sunday I was in the locker room of my gym, the Claremont Club. I had seen him there before, but here he was again, John Yoo, of Office of Legal Counsel fame. Just that morning at breakfast I had been telling Ann, with outrage, that the Bush Administration officials, the torturers, should be fully investigated and then, probably, brought up on charges. So what did I do.
I broke off an animated conversation I was having with three school aged kids about not drowning in the pool and yelled out, "John!" I had never met him, but what the hell, it's a locker room.
"Hey. I heard you went to Episcopal Academy!" A prep school on Philadelphia's Main Line.
"Yeah," he said expectantly.
"I went to Lower Merion."
He looked at me and said, "I guess that account for the Phillies shirt." T-shirt I was wearing, hadn't realized it.
"Yeah," I murmured brilliantly.
"What are you doing out here?"
"I'm a doctor."
He reached out his hand and we shook hands.
So, what's the deal?
Here I was saying "hi" to a war criminal. I can say that as a doctor, I accept and try to help everyone who comes my way. That's one of the things I really like about being a doctor - good role to play. And then, guiltily, it's fun to know someone famous, or infamous. How hypocritical am I?
Budd Shenkin
I broke off an animated conversation I was having with three school aged kids about not drowning in the pool and yelled out, "John!" I had never met him, but what the hell, it's a locker room.
"Hey. I heard you went to Episcopal Academy!" A prep school on Philadelphia's Main Line.
"Yeah," he said expectantly.
"I went to Lower Merion."
He looked at me and said, "I guess that account for the Phillies shirt." T-shirt I was wearing, hadn't realized it.
"Yeah," I murmured brilliantly.
"What are you doing out here?"
"I'm a doctor."
He reached out his hand and we shook hands.
So, what's the deal?
Here I was saying "hi" to a war criminal. I can say that as a doctor, I accept and try to help everyone who comes my way. That's one of the things I really like about being a doctor - good role to play. And then, guiltily, it's fun to know someone famous, or infamous. How hypocritical am I?
Budd Shenkin
Monday, May 18, 2009
Health Care Reform (4)
I’ve been struggling with where I stand (sorry to keep you waiting, world) on the current crunch issue in health care reform. That is, given that there will be a regulated menu of choices for consumers to purchase health insurance, should there be a public option? That is, among all the private companies – Blue Cross, Blue Shield, Aetna, etc. – will there be a choice “Big Government Program (BGP)?
My first inclination was to say yes. There would have to be regulation on the BGP; they would have to operate with the support of premiums only. They would keep the private health plans honest to some extent.
But then I got to thinking. First of all, even though I am reflexively a liberal even after all these years, my experience with public programs is just what the anti-government proponents say it is. They are inflexible and stupid. The Medicaid people who come to audit our charts in our offices are officious and odious, often – not always, but enough. The extent of regulations is exasperating. They make us check and regulate our scales annually at great cost and with little gain. The public regulations on what tests we can do in our office makes it financially impossible to do simply tests that would benefit the patient, but we have to send them to the lab, so the lab makes more money from a virtual monopoly, all because some poor doctors’ office labs in NYC screwed up some pap smears. Government is a heavy hand.
So, I was on the fence. Then I thought about this – as a private group we now negotiate fee schedules with the private companies. Sometimes we win sometimes we lose, but as a larger group with 9 offices in the East Bay, we do get some price concessions. Also, since we are justifiably regarded as a higher quality group, the private plans want us in their network. We have a higher cost structure than very small groups – as all practices in or near our category do – so actually we need the higher payments. So, in the competition for patients, we try to leverage our advantages against our disadvantages and get a decent price from the health care plans.
But we can’t do this with Medicare. It’s the same price for everyone under Medicare. They want to add some quality provisos to discriminate somewhat among the practices, but this effort has a long way to go before it is accurate and effective. With a BGP, Bayside (our group) would be a price-taker, just like every other practice.
Except the big ones. I suspect that the big groups will find a way to enhanced reimbursement. So our group (true, I’m ever the pessimist) will be large enough for a higher cost structure, but small enough for no enhanced reimbursement.
If the cost structure were too low, could we just opt out? That would be strange for us to do, because we take Medicaid now, and the new BGP would probably pay more than that price structure. And, if a whole lot of people were to choose the BGP, how could we hold ourselves out? Some elite practices will be able to, but we try to serve everyone, so it would be hard to stay out. And then the private plans would say, why should we pay you more that BGP? We have to compete with them on price, so we can’t afford to pay you more.
The only hope in this scenario would be for primary care prices to be raised by Medicare, but any such rise will be small, because of the Medicare budget woes, and the intense political activity of the higher paid specialists, and the ongoing unrelenting unreforming pressure from hospitals for higher payments.
So, now I’m really wondering. I guess the end result is going to have to be further physician consolidation so that we can all bargain together, and we at Bayside will have no price advantage over our smaller brethren. And maybe the AMA and other national organizations will be further empowered by necessity to have some kind of national negotiation. Or maybe the laws all change and enable regional groups to coalesce and become negotiating forces.
We'll have to see.
Budd Shenkin
My first inclination was to say yes. There would have to be regulation on the BGP; they would have to operate with the support of premiums only. They would keep the private health plans honest to some extent.
But then I got to thinking. First of all, even though I am reflexively a liberal even after all these years, my experience with public programs is just what the anti-government proponents say it is. They are inflexible and stupid. The Medicaid people who come to audit our charts in our offices are officious and odious, often – not always, but enough. The extent of regulations is exasperating. They make us check and regulate our scales annually at great cost and with little gain. The public regulations on what tests we can do in our office makes it financially impossible to do simply tests that would benefit the patient, but we have to send them to the lab, so the lab makes more money from a virtual monopoly, all because some poor doctors’ office labs in NYC screwed up some pap smears. Government is a heavy hand.
So, I was on the fence. Then I thought about this – as a private group we now negotiate fee schedules with the private companies. Sometimes we win sometimes we lose, but as a larger group with 9 offices in the East Bay, we do get some price concessions. Also, since we are justifiably regarded as a higher quality group, the private plans want us in their network. We have a higher cost structure than very small groups – as all practices in or near our category do – so actually we need the higher payments. So, in the competition for patients, we try to leverage our advantages against our disadvantages and get a decent price from the health care plans.
But we can’t do this with Medicare. It’s the same price for everyone under Medicare. They want to add some quality provisos to discriminate somewhat among the practices, but this effort has a long way to go before it is accurate and effective. With a BGP, Bayside (our group) would be a price-taker, just like every other practice.
Except the big ones. I suspect that the big groups will find a way to enhanced reimbursement. So our group (true, I’m ever the pessimist) will be large enough for a higher cost structure, but small enough for no enhanced reimbursement.
If the cost structure were too low, could we just opt out? That would be strange for us to do, because we take Medicaid now, and the new BGP would probably pay more than that price structure. And, if a whole lot of people were to choose the BGP, how could we hold ourselves out? Some elite practices will be able to, but we try to serve everyone, so it would be hard to stay out. And then the private plans would say, why should we pay you more that BGP? We have to compete with them on price, so we can’t afford to pay you more.
The only hope in this scenario would be for primary care prices to be raised by Medicare, but any such rise will be small, because of the Medicare budget woes, and the intense political activity of the higher paid specialists, and the ongoing unrelenting unreforming pressure from hospitals for higher payments.
So, now I’m really wondering. I guess the end result is going to have to be further physician consolidation so that we can all bargain together, and we at Bayside will have no price advantage over our smaller brethren. And maybe the AMA and other national organizations will be further empowered by necessity to have some kind of national negotiation. Or maybe the laws all change and enable regional groups to coalesce and become negotiating forces.
We'll have to see.
Budd Shenkin
Monday, May 4, 2009
Cyber-terrorism, a silver lining for the financial crisis?
I'm writing this from London, where Ann and I have come for a brief one-week R&R trip. My Dad said before he died 16 months ago, repeatedly, for that was his way, quite repeatedly, that he had seen the greatest change and progress of any generation the world had ever hosted. Born in 1915 and died in 2007 at age 92, he had seen horses as the major mode of transportation when he was first sentient, and you know what we had in 2007. He had seen his big brother Herb put together a crystal set in the attic so they could listen to radio, a new thing. He had gone into neurosurgery before there were antibiotics, let along CAT scans.
And when I was 20 years old just after my junior year in college, I flew to London from Boston in a Harvard Student Agencies trip where the airlines substituted a prop plane for a jet at the last minute, so I had a middle seat all night flying 12 hours over the Atlantic to land in London and I didn't know how to clear my ears out so I walked around London for a day and a half with my ears aching from pressure. Now we flew from New York in 5 hours 50 minutes with really good food on British Airlines, comfort, a daylight flight, and my ears are clear. OK, still with jet lag, which always affects me pretty severely, still getting up pretty late in the morning and not being quite with it, but that awaits another advance in science, I guess.
Our friend Michael Nacht has just had his Senate hearing to be Assistant Secretary of Defense for Global Strategic Affairs. In his portfolio is nuclear security and making progress with the Russians and others in disarmament, anti-missle defense, etc. This he is very conversant with, having been to 5 summits with Bill Clinton, 4 of them with the Russians in the 1990s. But also in his portfolio is cyber-security. According to his testimony under questioning from John McCain, he will be most concerned with making sure the computers at the DoD are secure. Not easy; I think they have already been hacked into, but I don't know how severely. Apparently, it's Homeland Security that will have primary responsibility for the more general cyber-security issue. But I think they will be working together. This is a road less traveled by Michael and I would think everyone; it's just a newer issue without a history of MAD and "Nuclear Weapons and Foreign Policy" by you know who.
But let's talk terrorism for a minute. It's been pretty clear for decades, I think, that no matter how antagonistic the major countries, they have a shared interest against the non-state actors and terrorism. Russia has Chechnya, the West has the Islamic terrorists. It's really better for both if the established powers retain their monopoly on violence, which makes them a non-failed state with sovereignty. Iran, a more ambitious nation, sponsors terrorism with non-state actors for purposes of national advancement, true, But once things are fairly well settled down into spheres of influence, the established states have a common interest as generic sovereign states.
But, what about the cyber age and hackers. Nobody foresaw this a lot that I have heard about, there was only the enthusiasm for the internet and computers, but now that they are so important to our everyday lives and our economy, as well as our national defense, the possibility of using cyber terrorism is clear. But who would do such a thing? A state actor might do something, such as Iran, I guess. And China might sponsor cyber industrial and military espionage, and from what I understand they actually do do this. But that's not terrorism, it's covert aggressive action in a more subtle way.
But what about the hackers? The Russians and the Ukrainians know who at least some of the hackers are who commit what comes close to high crimes. In fact - and here's the kicker - these very young people are regarded as heroes in their home towns!! Look what our boys (and some girls) were able to do, headlines the local newspapers, with pictures!
Why is this? I think it is a side effect of the culture of oppression. If you have been under an oppressive dictatorship as the Russian have been for ages, doing something to tweek the authorities is regarded with glee. Look what they were able to do to these men who oppress us! Authorities then have to decide what to do, and as long as these rebellious elements target the West, well, let them have their fun, and we will wield our authority when it really counts for us.
But now (and I owe this point to Ann) comes the silver lining of the ffinancial meltdown. It is now crystal clear that financial troubles in the US have worldwide consequences. If young hackers in the Ukraine or Russia or Eastern Europe bring down the Western financial system, there will be foreign officials smirking at the troubles of others -- there will be trouble right home in River City for each of them.
I think, but I don't know, that the Russians, Chinese and others have let their hackers have their way with the West up to now. I know that the West has been unable to have the Chinese clamp down on patent or copyright infringers. In those cases, the profits of the West are cut down but it doesn't really hurt the rest of the world. But if the hackers go after the financial system, if they go after money in the bank or in mutual fund companies or in large institutions, won't it be clear to the foreign countries that their own welfare will be at stake?
On the other hand, the hackers will probably foresee this, and go at things piecemeal. Just take a part of this; just take a part of that. Their efforts won't be terroristic, but theft. Still, it's money, and I think it would hit just close enough to home that the national governments would be moved to take steps. When it comes to protecting money, I think the cry will be, Countries of the World, Unite! You Can't Afford to Lose Your Money!
Where is the new Von Neumann? It's game theory all over again.
Budd Shenkin
And when I was 20 years old just after my junior year in college, I flew to London from Boston in a Harvard Student Agencies trip where the airlines substituted a prop plane for a jet at the last minute, so I had a middle seat all night flying 12 hours over the Atlantic to land in London and I didn't know how to clear my ears out so I walked around London for a day and a half with my ears aching from pressure. Now we flew from New York in 5 hours 50 minutes with really good food on British Airlines, comfort, a daylight flight, and my ears are clear. OK, still with jet lag, which always affects me pretty severely, still getting up pretty late in the morning and not being quite with it, but that awaits another advance in science, I guess.
Our friend Michael Nacht has just had his Senate hearing to be Assistant Secretary of Defense for Global Strategic Affairs. In his portfolio is nuclear security and making progress with the Russians and others in disarmament, anti-missle defense, etc. This he is very conversant with, having been to 5 summits with Bill Clinton, 4 of them with the Russians in the 1990s. But also in his portfolio is cyber-security. According to his testimony under questioning from John McCain, he will be most concerned with making sure the computers at the DoD are secure. Not easy; I think they have already been hacked into, but I don't know how severely. Apparently, it's Homeland Security that will have primary responsibility for the more general cyber-security issue. But I think they will be working together. This is a road less traveled by Michael and I would think everyone; it's just a newer issue without a history of MAD and "Nuclear Weapons and Foreign Policy" by you know who.
But let's talk terrorism for a minute. It's been pretty clear for decades, I think, that no matter how antagonistic the major countries, they have a shared interest against the non-state actors and terrorism. Russia has Chechnya, the West has the Islamic terrorists. It's really better for both if the established powers retain their monopoly on violence, which makes them a non-failed state with sovereignty. Iran, a more ambitious nation, sponsors terrorism with non-state actors for purposes of national advancement, true, But once things are fairly well settled down into spheres of influence, the established states have a common interest as generic sovereign states.
But, what about the cyber age and hackers. Nobody foresaw this a lot that I have heard about, there was only the enthusiasm for the internet and computers, but now that they are so important to our everyday lives and our economy, as well as our national defense, the possibility of using cyber terrorism is clear. But who would do such a thing? A state actor might do something, such as Iran, I guess. And China might sponsor cyber industrial and military espionage, and from what I understand they actually do do this. But that's not terrorism, it's covert aggressive action in a more subtle way.
But what about the hackers? The Russians and the Ukrainians know who at least some of the hackers are who commit what comes close to high crimes. In fact - and here's the kicker - these very young people are regarded as heroes in their home towns!! Look what our boys (and some girls) were able to do, headlines the local newspapers, with pictures!
Why is this? I think it is a side effect of the culture of oppression. If you have been under an oppressive dictatorship as the Russian have been for ages, doing something to tweek the authorities is regarded with glee. Look what they were able to do to these men who oppress us! Authorities then have to decide what to do, and as long as these rebellious elements target the West, well, let them have their fun, and we will wield our authority when it really counts for us.
But now (and I owe this point to Ann) comes the silver lining of the ffinancial meltdown. It is now crystal clear that financial troubles in the US have worldwide consequences. If young hackers in the Ukraine or Russia or Eastern Europe bring down the Western financial system, there will be foreign officials smirking at the troubles of others -- there will be trouble right home in River City for each of them.
I think, but I don't know, that the Russians, Chinese and others have let their hackers have their way with the West up to now. I know that the West has been unable to have the Chinese clamp down on patent or copyright infringers. In those cases, the profits of the West are cut down but it doesn't really hurt the rest of the world. But if the hackers go after the financial system, if they go after money in the bank or in mutual fund companies or in large institutions, won't it be clear to the foreign countries that their own welfare will be at stake?
On the other hand, the hackers will probably foresee this, and go at things piecemeal. Just take a part of this; just take a part of that. Their efforts won't be terroristic, but theft. Still, it's money, and I think it would hit just close enough to home that the national governments would be moved to take steps. When it comes to protecting money, I think the cry will be, Countries of the World, Unite! You Can't Afford to Lose Your Money!
Where is the new Von Neumann? It's game theory all over again.
Budd Shenkin