Monday, November 11, 2013


For some years now I have been wrestling with a dilemma.  On the one hand, I have been suspicious of commercial approaches to health care, believing that the interests of patients should rank higher than those of investors.  On the other hand I have increasingly become convinced that economic incentive is the only thing that will cause anyone to get serious about addressing the cost of health care. 

Then I read an article in the New York Times Magazine of Sunday, November 3 about Tom Scully and his new company Navicare.  During the 1990’s, Scully was head of the Federation of American Hospitals – the trade association of investor-owned hospitals – and from that position became head of the federal Centers for Medicare and Medicaid Services under President George W. Bush.

Navicare was formed to manage the care patients receive after hospitalization, known as post-acute care.  The prevailing routine has been that when post-acute care is needed, the doctor discharging a patient from hospitalization prescribes nursing home, rehab, or home health care and then has nothing further to do with it.  Providers of those services are paid on a fee-for-service basis and so the more service they provide, the more revenue they generate.  Navicare undertakes to reduce cost by managing the process and makes money by contracting with health insurance companies to share the savings.

The prospects look bright.  One can imagine opportunities for commercial abuse, but they seem rather unlikely to present problems. 

Maybe we are beginning to discover workable and acceptable ways to use economic incentives to get cost under control.

Friday, November 01, 2013


When quoting cautious Norwegians, Garrison Keillor, the St. Paul raconteur, makes common use of the word “mostly;” as in “Lutherans are hard-working people, mostly.”

If President Obama had followed that pattern when promoting his healthcare reform bill, he would have said something like “People who like their present health care insurance policies can keep them, mostly.”

But he left off the qualifier. For that he is getting the Pinocchio award.  And deservedly so.

Actually, what he should have said to be completely forthcoming was that people who like their present health care insurance policies can keep them, if they continue to be offered by the insurance company.  The Affordable Care Act, a.k.a. Obamacare, prescribes the basic benefits that health insurance policies must cover, but it exempts policies that were in effect at the time the law was passed.

As it happens, however, insurance companies change their policies frequently –notifying subscribers by means of unintelligible documents sent in the mail - and so by now, some three years later, many of the policies that were grandfathered have been modified and have lost their exemption.  A common reason for not meeting requirements is that the benefits are too skimpy, meaning that policies that qualify for approval offer more coverage and often cost more.

That may give the President a technical out, but does not let him off the hook, in my opinion.


This page is powered by Blogger. Isn't yours?

FREE counter and Web statistics from sitetracker.com