How Health Care Dropped Out Of The Presidential Conversation : Shots - Health Blog : NPR

Commentators noted how President Obama "hit a home run" with last weeks State of the Union address.  Little notice was the lack of mention of health care in the address.  The issue only received 44 words or 0.6% of the speech compared to 224 or 3.2% last year, 570 words or 7.8% in 2010, and 427 or 7.2% in 2009.  This is surprising as the Affordable Care Act is supposedly one of the President's proudest accomplishments.  An analysis of the address can be read here.

How Health Care Dropped Out Of The Presidential Conversation : Shots - Health Blog : NPR

There was also little mention of the issue in Mitch Daniels response to the address, while it is still often discussed on the campaign trail.  While polls have shown that the law is unpopular only a few have asked why it is unpopular.  These polls mostly have asked if the law is "too liberal" or "not liberal enough."  I have not found any mainstream media polls that mention single payer while some have mentioned the public option.  These posts are summarized below.

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Too Much of a Bad Thing

I've just recently caught up with a 2007 book by journalist Shannon Brownlee, Overtreated: Why Too Much Medicine is Making Us Sicker and Poorer. Although some of the specific policies she cites are being changed by the Affordable Care Act, her basic argument is worthy of our attention.

Most advocates of single payer health insurance are justifiably concerned about undertreatment, as represented by the 45,000 Americans who die every year from lack of adequate health care, but overtreatment is part of the problem because it drives up costs and convinces people that we can't afford health care for all. Overtreatment accounts for one-third to one-fifth of all health care spending, which amounts to $500-$700 billion in waste per year. In effect, the poor get too little health care because the rest of us get too much.

Overtreatment also leads to deaths and illnesses caused by too much medical care. The book is filled with these horror stories. In fact, almost anything that puts us in that house of confusion we call a hospital increases our risk of becoming a victim of medical error. Brownlee places the death toll for unnecessary care at 30,000 per year. (Unfortunately, although Brownlee includes footnotes, the sources of some of her statistics, including those in this and the preceding paragraph, are not cited.)

Overtreatment comes in several varieties. Unnecessary surgery is a huge problem, since it usually costs $50,00-$100,000 per operation. Heart and back surgery are the worst offenders. Researchers at Dartmouth first documented overtreatment when they noticed large regional and hospital differences in surgery rates that were not explained by illness rates in the area. Unnecessary tests cost less per incident, but are much more frequent. A special problem brought on by too many imaging tests, from mammograms to CT scans, is that reading the results is prone to error and leads to the “discovery” of non-problems, resulting in further unnecessary procedures. Finally, there are two chapters on the pharmaceutical industry, its creation of “illness” (“restless leg syndrome,” anyone?), and its marketing of ineffective and sometimes harmful drugs. (The definitive work on this subject is Marcia Angell's The Truth About the Drug Companies [2005])

Brownlee suggests several reasons for overtreatment. The Medical Institute has estimated that only 4% of medical streatments (drugs, tests, surgical procedures, etc.) are backed by strong scientific evidence of their effectiveness. Another 50% are supported by weak evidence; the rest have no support at all. In this environment, there are huge opportunities for subjective judgments by doctors, who are under pressure from all sides to do something rather than wait and see.

Our largely fee-for-service payment system is another cause of overtreatment, since the more treatment they provide, the more the medical establishment gets paid. To make things worse, both Medicare and insurance companies overpay for some treatments, especially surgery, and underpay for others, such as emergency and psychiatric care. Hospitals allot major resources to these profit centers (“centers of excellence”), while closing emergency rooms and psychiatric wards in spite of unmet demand. Brownlee labels this system “supply-driven demand.” If a hospital has too many beds, the beds somehow miraculously get filled. When the hospital spends several million dollars on a new MRI, the doctors request many more scans. An oversupply of heart specialists leads to an excess of heart surgery. Drugs advertised on television get prescribed, and so forth. Brownlee charitably suggests that this is a result of unconscious biases.

The solutions are fairly obvious. They will be costly to implement, but will pay off in the long run. First of all, research on the effectiveness of medical treatments is badly needed. It must be conducted not by the manufacturers of drugs and medical devices, but by disinterested university-based researchers whose work is supported by the government. Secondly, organizations such as the Veteran's Administration and Kaiser-Permanente have been shown to reduce costs and improve treatment outcomes by coordinating patient care. This is accomplished in part by good computer tracking. It also requires assigning each patient to a general practioner who knows the patient well enough to recognize her in the grocery store. Brownlee strongly believes we need more generalists and fewer specialists. Finally, it requires a reimbursement system that rewards doctors for producing good patient outcomes, rather than paying them a piece-rate for each procedure.

Overtreated belongs on everyone's short shelf of books about health care policy.

The Need for an Economic Impact Study in Pennsylvania

In my posts on the STOP Obamacare in Pennsylvania group, I commented on their analysis of the uninsured and how Obamacare would not control skyrocketing healthcare costs.  My expertise is in health statistics and not in economics.  In many ways there is no separating the health effects from the economic effects of a single payer system as the video clip below shows.  An economic impact study by William Hsiao which showed how it would benefit Vermont was one of the main catalysts for them enacting the first Single Payer System in the nation.  Healthcare for all PA, PUSH's statewide organization, is raising money for one such study here in Pennsylvania.  You can donate to it here at the link below or at the education fund site link on the upper right hand corner on this page.

Why Pennsylvania Urgently Needs a Single Payer Healthcare Economic Impact Study

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Taming the Gift Culture

As Paul Ricci noted here last week, one point about which we agree with conservative critics of the Affordable Care Act (ACA) is that it doesn't do enough to contain costs. That's where the agreement stops. We disagree about the major reasons that health care costs so much more in the U.S. than other industrialized countries; hence, we disagree about how to reduce costs. Advocates of single payer note that costs are certain to be higher when both medical care and health insurance are provided by corporations that are motivated to maximize profits.

To be fair, however, the ACA does contain some provisions to reign in costs, but without altering the basic economic structure of the system. One of these reforms was announced the other day. Manufacturers of drugs, medical devices and medical supplies used by Medicare and Medicaid patients will soon be required to report all payments and gifts they make to doctors or teaching hospitals. The data will be posted on a government-run website that will be searchable by the name of the doctor.

The New York Times reports that 25% of doctors report receiving cash payments and two-thirds report receiving gifts from drug and medical device manufacturers. This includes research and consulting fees; food, travel and entertainment; free samples (“the first bag of heroin is free”); plus all those incidentals such as pens and tote bags with the manufacturer's name on the side. (One doctor's son said that it wasn't until he was eight years old that he realized not all frisbees had the word “Merck” printed on them.) These gifts can result in doctors prescribing expensive new drugs that are no more effective than generics, or requiring tests and procedures that have no real benefit to the patient.

Doctors are embedded in what anthropologists call a gift culture, a network of reciprocal favors in which there is no explicit agreement as to when and how the favor will be repaid. These favors create feelings of obligation to the benefactor, obligations that may be repaid many times over, but the lack of an explicit quid pro quo reduces awareness of the corruption that is actually taking place.

Many years ago, social psychologist Bob Cialdini reported how a little gift can go a long way. Hare Krishna disciples who handed out paper flowers at airports, for example, were paid back many times over by voluntary contributions from recipients. There are several studies showing that this works in a medical context. For example, Orlowsky and Wateska (1992) examined the effects on doctors of free trips to seminars in sunbelt locations sponsored by the manufacturers of two relatively new prescription drugs. Their data showed significant increases in prescriptions of the two drugs in comparison to other hospitals, and in comparison to other drugs having the same effects. Interestingly, 17 out 20 doctors in the study stated unequivocally that the free trip would not influence their behavior.

This disclosure requirement is certainly a step in the right direction. My question is whether it goes far enough. Lawrence Lessig, in his new book about political corruption, Republic Lost, calls transparency a “reform that doesn't reform.” Have you ever looked at one of those lists of contributors to a political campaign? Did it help you? Most of them are people and organizations you've never heard of. The list provides little information about what these contributors wanted or how they were repaid after the election.

Similar lists of medical company gifts and payments may not be very useful to consumers. How many of them will consult the website in advance of a visit to the doctor? Even if they do, the fact that General Electric is on a doctor's list of contributors only helps if you know that GE manufactures the device that will be used to scan your internal organs. The fact that a drug company is on the list is useless unless you have memorized which drugs that company markets. In some cases, the absence of a corporation from the list may be more meaningful than its presence.

This website may be useful to researchers and investigative reporters, and this could benefit consumers indirectly if their studies are reported by the media. The existence of the list could also embarrass some doctors into refusing gifts, although I wouldn't count on that, since almost all doctors erroneously believe that gifts have no effect on their decisions.

But the real problem is that this is only a half-baked reform. Since we know the unfortunate effects payments and gifts have, they should be banned, not reported on some obscure government website.  

Canadian Testimonials

We often hear about from opponents of health care reform testimonials about the horror stories of the Canadian health care system to scare individuals here into opposing real reform here in the US.  It's always easy to find a few cases where the system did not work in a large country like Canada.  Here are testimonials which are far more typical from Canadians according to surveys eh.

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Since August, 88,000 Pennsylvania children have lost Medicaid benefits - Philly.com

This article was posted on how 88,071 children have lost Medicaid benefits due to bureaucratic backlog at the Department of Public Welfare with an increase in December (possibly when employees go on vacation for the holidays).

Since August, 88,000 Pennsylvania children have lost Medicaid benefits - Philly.com

                                   Total              Change                     %                                                                                                                        

August                      1,161,135            

September                1,143,169      - 17,966                 - 1.5%  

October                     1,130,300      - 12,869                 - 1.1%  

November                 1,117,728      - 12,572                 - 1.1%  

December                 1,073,064       - 44,664                   - 4%     

Change over four months:       - 88,071                - 7.6%  

These benefits should eventually be restored as Medicaid is still a federal entitlement program.  The conditions for employees at the PA Department of Public Welfare (DPW) have gotten worse in recent decades with staff reductions and caseloads increasing.  There were rumors of a strike in 2003 when I was an employee there when Rendell was newly inaugurated as governor.  The state budget was $40 billion then it is $27 billion now.  Data for adults is harder to come by according to the article but it is just as important.  It is a trick to starve social programs and then to argue that "see social programs don't work."

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STOP Obamacare in Pennsylvania: Where We Agree with Them

In my previous post on the STOP Obamacare in Pennsylvania, I commented on how Dr. Nicholas Pandelidis downplayed the problem of the uninsured in the US citing faulty research.  However there are some areas of agreement single payer advocates have with this group of controlling costs with the Affordable Care Act (aka Obamacare) that we do have.  Pandelidis cites many studies by groups like the Congressional Budget Office or CBO which show that health care costs have skyrocketed in the past and the new law will not control costs and be harmful to patients and providers.  He does note that costs have risen faster for the private sector than for Medicare and Medicaid in the last decade.  He goes on to list the causes driving the increases in cost here in the US which is "access to superior care" which is debunked in the graphic below and in the blog The Incidental Economist, the "third party payer system" which inflates costs due to profiteering, government regulation of insurance industry competition (how is the Highmanrk/UPMC tussle reducing costs and improving care for Pennsylvanians?), federal tax policy favoring employer provided versus individually purchased insurance (which is like switching the burden from Peter to Paul), and of course medical malpractice costs which is debunked in part two of the graphic below.

I am a statistician.  My background is not in actuarial science (financial forecasting).  I don't like relying on other people's arguments to build my own but this topic is too important for me to leave out.  We agree with the opponents that health care costs need to be controlled and with opponents of Obamacare that it will do little to curtail the causes of the inflation.  We do not agree with the proposed solutions.  Many other industrialized nations are better able to control costs and provide care with better outcomes than we are.  In Pandelidis' article, he even agrees that public insurance plans control costs better than private.

Via: Medical Billing And Coding

Via: Medical Billing And Coding

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Gekkonomics

 

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Gekkonomics

You won't be surprised to learn that the University of Pittsburgh Medical Center's (UPMC) out-of-network fees are way above the national average. According to data compiled by the Center for Medicare and Medicaid Services, UPMC charges more than many of the nation's most highly regarded hospitals, such as the Cleveland Clinic, and twice as much as its only real competitor, Allegheny General Hospital (AGH). In 2010, UPMC's average charge for inpatient care was $121,765, compared to $74,406 at the Cleveland Clinic and $55,205 at AGH.

Out-of-network fees originated in the 1980s, when Medicare and Medicaid began reimbursing hospitals prospectively rather than after-the-fact for some procedures. Insurance companies then began to negotiate discounts for their subscribers, in exchange for channeling those subscribers to “approved” doctors and hospitals. By 1990, only people without health insurance and international visitors were charged the “full cost” of medical services—the out-of-network rate. For people with health insurance, the “full cost” is really just funny money—an unrealistically high charge that appears on their statement. Health insurance pays only a fraction of that cost, and the remainder is waived.

However, in June 2013, out-of-network fees may become real money for many Western Pennsylvanians if UPMC, the region's largest hospital chain, carries out its threat not to negotiate an agreement with Highmark, the region's largest health insurance company.

If we accept the Medicare reimbursement rate as the real cost of hospitalization plus a modest profit for the provider, then UPMC has an average markup of 850%. Dr. Gerald Anderson, a health policy expert at Johns Hopkins University, is quoted as saying, “I think they have an ethical problem in trying to say they should be paid eight times more than what it costs to provide the service.”

This brings us to the presumed motive for UPMC's and Highmark's behavior—monopoly control and the ability to fix prices. Large corporations move toward monopolies through two types of integration, horizontal and vertical.

Horizontal integration occurs when companies buy out competitors that provide the same product or service, thereby increasing their market share. For the last decade, UPMC has been aggressively buying other hospitals in the region. AGH is its only major remaining competitor. If it provides an essential service and has no competitors, it can charge whatever it wants.

Vertical integration occurs when a company controls several stages in the supply chain that produces a product or service. For example, a company that sells natural gas to consumers may also own gas wells and control prices by speeding up or slowing down production. Or a movie studio may own a theatre chain which preferentially books its films and refuses to book films by competitors. In 1998, UPMC started its own health insurance division, the UPMC Health Plan. Highmark retaliated by agreeing to purchase AGH. Of course, both hospitals and insurance companies can use the threat of out-of-network fees to pressure clients to purchase the complementary service from its own affiliate.

It appears that both UPMC and Highmark are trying to obtain monopoly control of the health care system in Western Pennsylvania. Since our very lives are at stake, if either of these “nonprofits” achieves their goal, they will be in a position to make us what organized crime calls “an offer we can't refuse.”

Of course, this kind of outrageous profit-taking would disappear under a single payer health care system.

Occupy UPMC Insurance and Highmark-Pittsburgh, PA USA

Southwest Pennsylvanians, unlike our Republican Candidates declare, can not "fire their insurance companies." (Mitt Romney) And, for Senator Rick Santorum, please come to my family, or spend one day at our office and you will find that there are thousands of Pennsylvanians who do die of lack of access to Health Care!

If you are tired of the Lies, Please join PUSH, Occupy Pittsburgh, Save Our Community Hospitals, SW Pa for Single Payers and others who are protesting for Universal, Affordable Healthcare

February 11, Tues, Noon, at Occupy Pittsburgh, then March and Rally at US Steel Building (UPMC Insurance) and then Highmark Insurance Rally. BTW, Its Free.

Romney's Gaffe

Governor Mitt Romney's statement, "I like being able to fire people," has been widely misinterpreted. He did not say that he enjoys firing his employees. The reality is much worse. The remark was made in the context of a discussion of health insurance. It shows how out of touch Romney is with the health insurance system in this country.

Please read this comment by Aaron Carroll, from The Incidental Economist blog. He points out why most Americans can't fire their insurance company. I have nothing to add. I just wanted to call it to your attention.

Santorum: No One Has Ever Died Because They Didn’t Have Health Care | The New Civil Rights Movement

This is my first cross post on my two blogs because it fits in so nicely with what I've been talking about on both of them, Rick Santorum and the uninsured. As the former Senator from our state is quoted in the story linked below stating that no one has died due to a lack of health insurance while campaigning in Iowa in early December while he was still polling in the single digits. The exact quote can be read here.  This statement is consistent with his later statement right before the caucus regarding African-Americans and entitlement programs which preceded his strong showing on Jan 3 (only 4% in the CNN entrance poll said health care was the most important issue in the Caucus).

Santorum: No One Has Ever Died Because They Didn’t Have Health Care | The New Civil Rights Movement

This one claim about health care is so demonstrably false with the study I discussed in my previous post on the PUSH website where 45,000 excess deaths in the US each year were estimated from a lack of insurance after adjusting for smoking, obesity, and poverty.  It would only be necessary to show one death from a lack of insurance to prove Santorum's statement wrong.  Josef Stalin once infamously said "one death is a tragedy, a million deaths are a statistic."  It is important to supplement the statistics with narratives from those who are affected most by the problem of the lack of insurance.  That is why we included testimonials like the ones below from Healthy Artists on this webpage from the uninsured.

Michael Moore's film Sicko has the stories of several individuals who are underinsured including a few who died as a result of their situation.  The website Names of the Dead has testimonials from families of those who died as a result of a lack of insurance.  It gives the names and cities of each story so they can be checked for veracity.  This is one from Altoona, PA.  Senator Santorum says he wants to save America from fascism as his grandfather escaped it in Italy.  The first step in fighting it is acknowledging the truth.

Uncle Abe

64, Altoona PA
Cindy Lovell writes:

My Uncle Abe worked as a self-employed plumber. Some years he could afford insurance, and some years he couldn't. He came down with congestive heart failure, and he could not afford insurance. He kept waiting to see a doctor until he turned 65 so he would have Medicare. He waited and hoped. Finally, he got so sick that my other two uncles went and got him. They intended to take him to the emergency room and pay his bill. Both are retired and on fixed incomes, yet their baby brother was so sick, and they were so scared, that they figured they would come up with some way to pay his hospital bills. However, Uncle Abe died in the emergency room... waiting to turn 65!

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The Colbert Report
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