Thursday, August 20, 2009

Please be Clearer, Mr. President

Though I have no illusion that he will ever see it, I have sent off the following letter to President Obama:

Mr. President, if you want to know why your health care reform program is drawing so much flak, you might find at least some of the reasons in the Op-Ed piece that appeared under your name in last Sunday’s New York Times.

To begin, the title of the piece was Why We Need Health Care Reform. But by the third paragraph, you referred to the subject under discussion as health insurance reform. Health care and health insurance are not the same, Mr. President. Which is it you want to reform?

You went on to discuss the four main ways that reform would make things better.

The first was that your health insurance would offer high-quality, affordable coverage. How can you assure affordability when health care represents seventeen percent of the economy? In those conditions, can health insurance be made “affordable” without a government subsidy? Is that what you have in mind? How would it be paid for without increasing the federal deficit, which you have sworn not to do?

You also said that the coverage would “stay with you whether you move, change your job, or lose your job.” Just how would you do that, Mr. President? What if my new employer uses a different insurance company that offers different benefits? If I lose my job, who will pay my insurance premiums?

The second was that “reform will finally bring skyrocketing health care costs under control.” Again, Mr. President, just how would you go about doing that? You speak later about cutting “hundreds of billions of dollars in waste and inefficiency in federal health programs like Medicare and Medicaid.” These are programs you administer, Mr. President, and if there is waste and inefficiency why don’t you just go ahead and do something about it?

The third was that the money saved by making Medicare more efficient would be used to make its benefits more generous, including paying a larger portion of drug costs. That would all be very nice, Mr. President, but it doesn’t do anything to reduce overall costs, which you have said on a number of occasions are already too high.

The fourth was to provide consumer protection, such as prohibiting the denial of coverage for pre-existing conditions and limiting co-pays and deductibles. That would also be nice, Mr. President, but it surely will make health insurance more expensive. Also, if I don’t have to worry about pre-existing conditions, what is to prevent me from just doing without insurance until I get sick, knowing that I can get it when I need it?

These uncertainties make people nervous, even frightened. If you want people to support your reform efforts, Mr. President, I suggest that you be clearer on points like these.

Tuesday, August 18, 2009

Efficiencies That Cost More

Early in my hospital administration career I came to the conclusion that whatever I undertook to do to improve efficiency always cost more money.

People would come to me with programs they wanted to mount or changes they wanted to make and often would defend their ideas at least partly on the grounds that they would improve efficiency. But when we got down to details, it seemed always to turn out that in order to implement the proposal, the budget would have to be increased.

The principle seems to be alive and well. The Op-Ed page of last Saturday’s issue of The Boston Globe consisted of five columns on the subject Massachusetts health reform: What’s next? The authors were local health care leaders.

A common theme was that cost control was the next priority now that the number of uninsured had been greatly reduced. A number of suggestions were made. They included fixing ”the dysfunctional Medicare payment system” to spare physicians from “devastating fee cuts,” making sure that global rates “adequately reflect the fact that some organized systems will have sicker patients,” adequately funding primary care teams, implementing a “fee-for-results payment system,” and “ending chronic underpayment for care within the Medicaid system.”

So far as I can tell, all of those would cost more money. The author promoting primary care teams openly conceded as much.

All of that makes me skeptical about cost control measures that are being suggested from outside the delivery system, such as healthy lifestyles, early diagnosis, clinical effectiveness research, and expanded use of computers.

If we are going to get serious about cost control, we don’t need proposals that vaguely promise efficiencies. We need ones that that specify where, how and when savings will be realized and who will be responsible for making them happen.

Monday, August 03, 2009

Political Correctness and Health Care Reform

Political correctness and the associated conceptual confusion account for much of the difficulty being experienced in achieving meaningful reform of health care.

The point is amply illustrated in an article by Victor Fuchs, a renowned Stanford University health economist, now retired, that appeared in the most recent issue of Web Exclusives by the highly respected journal Health Affairs.

In his article, Fuchs argued that reform should concentrate first on what he termed the “essentials” which he characterized as the four Cs; i.e., coverage, cost control, coordinated care, and choice.

Fuchs began by saying “First, truly universal coverage – 100 percent of Americans – is essential.”

Except for Massachusetts, every recent attempt at universal coverage has foundered on the shoals of cost, and Massachusetts is struggling. The obvious conclusion is that cost control needs to come first. Yet the political correctness of the universal coverage idea is so intense as to prevent almost everyone from saying so.

Discussion of cost control, the second C, is lengthy but, consistent with the general lack of academic interest in the subject, shows no recognition of the urgency of the problem and includes no suggestion that offers the prospect of near-term results.

Comments on coordinated care focused on indirect influences like the payment system, self-referral to physician-owned facilities, laws and regulations. Coordination is something that providers have to do. But suggesting that providers need reforming remains very politically uncorrect and there is no mention of the need for them to get themselves organized and do their jobs.

As to choice, the final C, Fuchs does gently recognize that “some restriction on choice [of provider] may be necessary in the interest of quality and cost.” However, the example he uses is not patient choice of physician but, rather, the “any willing provider” laws that compel insurance companies to pay any doctor who will accept their fees and procedures.

If we could deal with the real world rather than with the politically correct, we might:

- pursue cost control before taking up universal coverage,
- require providers to contribute to cost control by devising better and less expensive methods of care,
- require providers to take their responsibility for coordination of care seriously, and
- agree that insurance companies should have the right not to pay whatever doctor the patient picks (i.e., exercises choice) regardless of competence or efficiency.

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