Tuesday, July 7, 2015

WSJ oped on HDHPs - Ideology Rules

Department of more than you ever wanted to hear.

High Deductible Health Plans, HDHPs, is an issue that won't go away anytime soon. It became my baby when I was assigned to write the policy paper for the American Academy of Pediatrics and did a pretty comprehensive job on it. Published last May, the result is here: http://pediatrics.aappublications.org/content/133/5/e1461.full.pdf+html.

The pro-HDHP argument is often supported by Right wing ideologues on the oped pages of Wall Street Journal. Now, I myself am pro-market when there can be a market. Markets are easier and better than regulation when they operate correctly. That's why a carbon tax is a good idea, to let the market figure out the best way to minimize carbon in the atmosphere, or failing that, a cap and trade system. Markets rule, when possible.

The problem with ideologues is that their ideologies are the proverbial hammer that finds every target to be a nail. Ideology trumps facts for the ideologue. So last week we read on the WSJ oped page that Obamacare had inadvertently produced a pro-market force called HDHPs. Of course, it wasn't really inadvertent – it was part of the regrettable but perhaps necessary strategy of continuing the trend that existed. Oh, let the magic of markets work, the authors said! Find ways to make prices more transparent!

My cogent response is this, sent to the WSJ as an (unpublished) letter to the editor:

Competition in a marketplace is a wonderful thing when it is possible. HDHPs, however, act at precisely the wrong place in the system, with precisely the wrong population, and demand more medical savvy from patients than is reasonable.

Deductibles impact the first dollars spent for care, but the bulk of health care dollars are spent by the 10-20% of patients who are sickest, who blow by the deductibles early on. Likewise, the highest costs and prices exist in hospitals and specialty procedures – little of which is affected by deductibles. Deductibles have most impact on primary care, which has the lowest prices in the medical arena, and which is generally not over-utilized. Deductibles have the biggest impact in the working population, those just making it, those to whom we should be giving the most support, while poorer Medicaid patients get care for free, and well off patients can often well afford the deductibles and thus are much less deterred. Studies show that many patients of modest means forego important care just when it is needed most.

Markets require consumer knowledge of the value of care and the price of care. Yet because most people are not medical professionals themselves, they find it impossible to make wise choices, a phenomenon that we in practice see every day. In addition, not even clinicians can easily discover prices. HDHPs cannot create a market where a market cannot easily exist.

HDHPs and a market mechanism could possibly work at the higher levels of care, where the real money is. Primary care practitioners could choose well for their patients if they were paid to do so and prices were readily available. Hospitals could compete if they were not merging instead, and thus protecting their prices. Alas, political power lies with those whom HDHPs don't affect, the big money regions of healthcare, but it is the politically weakest actors, primary care practitioners and patients of modest means, who are subjected to these insidious plans.

My pediatric colleague Mark Simonian of Fresno replied:

There were more issues than high deductibles and Health Saving’s Plan discussed by the authors like finding mechanisms to make the cost of care more available and comparable.”

So here is how I answered Mark:

Price transparency is a good idea.  We should have more of it.  I wish we had had it available a few years ago before our local hospital charged us $12,000 for an abdominal MRI.

But with HDHPs, the only services that will be affected will be the lower cost ones, and by assigning patients be the ones to explore the field for bargains, some will but many won't, it will be very hard for them to do it knowledgeably, and it is really putting the harness on the wrong horse.  The primary care physician should be the one best placed to make decisions for the patient, since we know more and can do so more easily.  But if we are to do this work of helping the patient to choose wisely, as we should, we need to be paid for it.  Rushing along every 15 minutes and doing the EMR charting, etc. --- if you are going to do some shopping, then you need to be paid for it somehow.  And let's remember, the point of HDHPs is to get the primary physician less used by patients, not more used, thereby undercutting the whole concept of a PCMH.

Price transparency and good competition by hospitals would be great.  Except, they increasingly own each other, and make their bills so incomprehensible that transparency means virtually nothing.  Also, our local children's hospitals are usually the best place for us to send our patients, and they are natural monopolies, so competition won't work with them, and so price transparency won't help all that much.  Hoping for a market here is the triumph of ideology over reality.  Ain't no market, ain't gonna be no market.
Some say that HDHPs ask patients to do what the profession and the industry has been unable to do itself, which is to make utilization and prices reasonable.  Good luck with that.

At least, that's my opinion, unhedged.  In fact, pissed at these ideologues who further their own careers by spewing this drivel, aided and abetted by those who profit by the status quo, and those who just don't care about others as long as they get theirs.

So, the beat goes on. Who knows when it will end? But I am actually optimistic that sooner rather than later, the HDHP policies will be amended, more visits allowed without the deductibles, and even, eventually, competition applied to higher priced items. The key word being, alas, “eventually.”

Reader, I know I am pounding this nail so hard and so repeatedly that it is boring, boring. I promise to let up on it and review more books instead.

Budd Shenkin

No comments:

Post a Comment