Wednesday, December 16, 2009

Senate Vote on Heath Care Reform

We seem to be just days away from a senate vote on the mysterious health care reform bill. Mysterious because as a citizen listening for months to the debate, I'm not sure what's in the bill. Over the last few months the debate has shifted from insurance reform, coverage issues, cost escalation, affordability, single payer issues, government insurance policies, health (medical) care entitlements, complexity of medical services provision and reduction of service.

In many ways all of these issues are related and effect one another. The degree of the effect depends on the priority given to a particular issue (coverage, cost, service, medical need, demand, value to society, so on). The relatedness in part arises from the complex nature of medical care, the technical support needed, the longevity of care required by certain conditions and perhaps most importantly the concentration of medical care that comes at the end of life.

To darken and obscure the debate further is the issue of the right to health care. A divide exists between cultural individualism that is so American and the social concern that pervades the the democracies of the west. Each of these camps has its strong argument but alas peace between them is only accomplished by a willingness to compromise. This has resulted in a cacophony of voices arising from the debate.

From my perspective (health care provider and payer) I have a growing cynicism of (or alienation by) the motives of those involved. The end result is a sense of resignation to whatever comes out of this. Being neither a libertarian nor a social Utopian I have no side that I really wish to join. Being a health care provider I feel a growing sense of enslavement by those who wish to administer medical care. The alienation arises from the sense that my work will no longer be mine by belongs to the owner of the process. As a provider I feel like K, I know I'm guilty but don't know what the charge is. Let's hope it is over quickly.

Perhaps this is my cynicism coming through but I think that our congress people have lost perspective on the whole issue of governing. They are a generation that has grown up on contests and this is just one more contest to win. They have been taught that the contests are fun but trivial. It's a show for the spectators. It's a contest to massage their egos. The lawmakers because of their positions and power can remain detached from their actions. But the sad reality is that what they do is serious. They make law but forthe law to be effective must have teeth. Those teeth will bite someone.

Tuesday, November 3, 2009

Still Waiting but More Enlightened

Well no healthcare (or whatever it should be called) bill yet. I understand that the current Pelosi bill is almost 2000 pages long. Although the purposes of this legislation are now beyond comment, this effort at healthcare reform is interesting from a methodological and ideological perspective. As I look at what has happened over the last several months I've been curious to understand why. From my stanpoint what is happening seems to go beyond just reform of the insurance racket (oops I meant industry). I do firmly believe as a patient and physician, that the insurance industry regulations need revamping, but I also believe that there are actually companies that have good intentions that serve in this industry as well and after all I am an American.

I think the passion for reform has cooled in the hearts and minds of many citizens. In the common sense mindset of most Americans 'change' usually means attempts at improvement. Most people are naturally conservative so that change for them doesn't mean throwing resources away but figuring out how to improve their utilization. Even conservatives are paaionate about that type of change. This is what we usually call innovation. I think that the citizens have become more cautious about changes to healthcare that go beyond improvements to the system. The case for completely doing away with healthcare delivery as it is now done has not been proven in the minds of many Americans, hence a cooling of passion for 'change'.

On the other hand this administration may see change as something different. The now famous phrase 'yes we can' which became the slogan of the Obama campaign had its origin in a speech given in weeks following victory in Iowa and leading up to the South Carolina primary. In this speech the original phrase was 'yes we can change'. This was shorten to 'yes we can' which I think was an astute political move on the Obama campaigns' part.

This raises an important ideological and methodological point of view that I've pondered for months during the healthcare debate. When asked what his preference for healthcare reform would be President Obama stated in an Arizona town hall meeting that 'If I were starting from scratch, I’d go single-payer...' So why are the democrats taking this road instead of starting from scratch? The answer of course lies in the conventional understanding of change for most Americans. Most citizens want to improve the system not scrap it.

So how does this monstrosity of a bill help the Democrats and the Obama administration? I think that traditionally minded democrats are now wary of this legislation. However the bill does bring change even if it doesn't prove to be improvement. Furthermore I'm convinced there appears to be an element in the thinking of this administration that sees 'change' a a predicate ('yes we can change') and not as a subject. This is why the bill even if totally flawed is a victory for them if you understand my meaning!

Wednesday, September 23, 2009

Health Care Reform

Okay we all know that the Baucus bill that is in committee now is not truly a "Health Care Reform" bill in the sense that it is not trying to change medical decisions for the treatment of a specific disease. The legislation is at its essence a health care delivery bill which may tangentially effect medical decisions. It's really a mixture of public health policy and medical reimbursement as illustrated in the following comment:

I mentioned that I would at sometime talk about utilization and cost and the following is a smattering of what probably constitutes the bulk of the legislation now being secreted through the senate finance committee. I say secreted because it was voted in committee this week to deny public access to the contents of the bill for now. The following comes from the College of American Pathologist research into the committee hearings on the part of the bill that is of interest to the laboratorian.

"The Senate Finance Committee (SFC) mark-up today has yielded some important modifications to the "user fee" that was previously contemplated in Chairman Baucus' "mark" last week. Based on information gleaned from a SFC release and other legislative summary documents, SFC has eliminated the "user fee" in favor of adjustments to the Medicare clinical laboratory fee schedule (CLFS). The legislative summary is as follows: "For providers paid through the clinical laboratory test fee schedule, the Chairman's Mark replaces the scheduled 0.5 percent payment reduction for years 2011 through 2013 with a full productivity adjustment for 2011 and subsequent years. The clinical laboratory productivity adjustment could not reduce the fee schedule update below zero. In addition to the productivity adjustment, for the years 2011 through 2015, the clinical laboratory test fee schedule would be further reduced by 1.75 percentage points." "

As you can see the language in this text is primarily concerned about the structure of reimbursement and hopes to put into position a reduction of fees allowed by the laboratory to control cost to the health care financier (especially a government program). At the risk of being overly clear, the impact of such a system on the provider side is to reduce the profit margin for the laboratory and the impact on the payer side is to reduce cost. (Now that is a fair and balanced statement.)
The production costs of tests in the lab is a complex analysis of reagent cost, utilization rates, labor, reagent shelf life, test frequency and interpretation. Almost every test offered by a laboratory undergoes some sort of cost/profit analysis. I'm sure that the writers of this bill understand this production/cost analysis and have provided a means for the lab to justify the fees set by the lab for each test. Understand that each of these analyses requires research for information, estimation of utilization rates based on order frequency and disease prevalence, calculation of cost based on these finding, documentation and validation. The expenditure of time is considerable and is in addition to the performance of testing, quality management and reporting that is necessary. (The payer may also dictate the methodology used in the analysis.)
So what! You may be thinking aren't these things necessary for good business practice. Well yes and this goes on continuously in the lab for new tests, changes in methodology for old tests, changes in disease surveillance or cost of reagents. Bear in mind though that the analysis consequent to the bill are not driven by improvements to laboratory practice but by constraints imposed on laboratory practice by reimbursement adjustments. Alternatively the lab may just discontinue that test to save cost.
Finally we all know what the language of 'productivity adjustment' means in beaurcatese. The worse case about 'productivity adjustment' is that it is a disincentive to doing things on a large scale which in terms of the laboratory usually means more efficiency. Therefore productivity adjustments run the risk of decreasing efficiency of labs by interfering with the economies of scale. Large labs also provide testing that is cost prohibitive (by cost analysis) in small labs.
Please forgive my obvious bias in this blog, as the debate goes forward

Tuesday, August 11, 2009

Health Insurance Reform

Before considering what medical care utilization and efficiency means there is a question that I've been pondering for a couple of weeks that needs an answer. The question is simple: what is medical insurance. The reason for the urgency is that Health insurance reform is the new buzz word this summer and in my opinion really means medical care delivery reform. But that begs the question what is health insurance. It is important to know how health care delivery and insurance are related so we can understand what law makers are trying to reform.


At the risk of stating the obvious, I wish to define the nature of insurance. Insurance is a contract between the insured and the insurer that a payment or services will be provider in the event of a particular events as defined in the contract. It is intended by the purchaser to cover expense and loss in the occurrence of an event (covered in the contract) that produces the loss. The insurer undertakes the coverage and fixes the price for the coverage based on the likelihood of the occurrence and the cost incurred. Insurance relies heavily on probabilities and frequencies of events to assess the risk involved. In circumstances where groups are concern (ie life insurance) the probability of an event (death) is calculated for the group and the cost is spread among the larger pool. For the insured the policy substitutes the uncertainty of the future for a certain outcome regardless of the events that unfold.


Now to the heart of the matter. No one would sell an insurance policy covering the cost of repair of say an automobile that has already been damaged. The policy would exclude prior damages that occurred prior to the policy being in effect. Insurance is meant to cover the unexpected or untimely event in most cases. The greater the likelihood of an event the more expensive the coverage will be for the purchaser. The buyer of insurance is purchasing certainty of outcome for the uncertainty of the event. In most cases the payout by the insurer is monetary. Cases of fraud have been uncovered where the insured tried to pass off an damage that occurred prior to the policy being in force.


There is one caveat that should be considered. If the insured has taken steps to reduce the risk of catastrophe then the insurer might offer a reduced premium for the coverage. An example of this is the cost of car insurance might be reduced to the purchaser for instance if the insured has taken driver's education. In this case the insurance company recalculates the risk involved base on the group of drivers that have taken drivers education which reduces the likelihood of an accident.


Medical insurance has followed this model of risk assessment by pooling groups of insured and excluding preexisting conditions. Payments are made to the insure on an occurrence basis. You rarely find policies that cover routine checkups unless the insurance company hopes to lessen costs of a catastrophic event by early detection of conditions that increase the risk of a poor health outcome (hypertension, glucose intolerance, obesity, colon polyps, etc.). In these cases the policy pays for screening tests that detect conditions that may arise during coverage and need to be managed to reduce the risk to the insurer. The coverage of an existing condition makes no sense to the insurer. The principle of insurance is calculating the risk which in the case of a preexisting condition has a probability of 1. In this case the cost of insurance would be the cost of the condition as a starting point. Uncertainty of outcome does not exist in this set of conditions.

So when lawmakers speak of including everyone in the insurance program and eliminating the exclusion of preexisting conditions this does not really fit an insurance model. If insurance is the delivery system for health care then the proposed changes do not make sense. However insurance is not the only model of health care delivery. It is a model that works in a market system where the insured wishes to obtain a level of certainty in the uncertainty of future health problems.

So to cut to the chase: If the goal of congress is medical care for all then the 'insurance reform model' is a silly euphemism for universal care. I call it silly because medical care for all does not fit into the insurance model in that there will be preexisting conditions with in the population. I think it obstructs useful debate about serious details that need to be clarified to refer to the legislative effort as Health insurance reform instead of universal health coverage. At its heart this is what the obfuscating terminology of health insurance reform does.

Disclaimer: Please see previous post. Although I've received payments from insurance companies I've never worked for an insurance company although at one time I was solicited to consider a course of study to become an actuary as I was making college plans.

Thursday, August 6, 2009

Health (Medical) Care Reform

Okay, by now you all know that it is not Health Care Reform but Medical Insurance Reform that is being debated so most of my comments have been off the mark so to speak. Anyway medical insurance reform is upon us and has simulated much thought and passion in the medical community and public at large. I suppose that medical insurance reform really means health care delivery reform. I think this more clearly marks the nature of the debate. That the subject is very complex is abundantly clear. With the government involved in programs it has a vested interest in the system of medical care delivery. Two issues of late have sparked my interest and I think provoke a wonder at the complexity of any attempt at overhauling the delivery system. One issue is that of costs and utilization and the other about efficiency. Both have to do with behavior and overall cost of care but may be code words with other meanings as well. (Isn't language amazing, we can say things to be understood in one way with not real intention of it being understood that way at all. I think politicians were the original post modernist language critics.)

Cost and Utilization

Medical insurance for consumers is a method of protection against catastrophic expense that may arise from illness. In some instances insurance is a means of obtaining medical care a reduced expense for the consumer. The insurance provider hides the cost to the owner of the policy. In this case the insurer bears the cost of the care provided within the limits of the policy.
For most of us some form of medical insurance provides protection against the cost of catastrophic illness and hope that the care will be there when we need it most. Each month we pay a premium for this protection and the costs of the coverage is a limiting factor in our budgets effecting decisions about cars, homes, furniture, education, recreation and or even business decisions. These costs are very high but most of the time the costs are hidden. We obtain the coverage and the deduction is made pretax or medicare/medicaid tax is withheld and we don't see the bill unless we look at the pay stub. We know how much is deposited and we budget our lives on the remainder of our paycheck. The cost is fairly fixed and doesn't merit our attention. Now this is not true for all of us but for those that work for large firms, businesses or the government it is true. For this type of individual the costs of coverage is hidden but the access to care is not.
In these circumstances the users pool their resources in these programs and the resources look unlimited. Utilization of this pooled resource has some constraints but in many cases there are few or ignored. To you and I, if the desire arises to use medical services, then I let my insurance pay for it. If my care provider suggests a procedure or service, he may say, "Don't worry your insurance will be billed." In such a system the results to the individual are definite and immediate, but the costs are hidden and vague. I receive what I want but the immediate effects of costs are diminished. This goes on day in and day out in our health care system.This system is similar to a credit card method of payment in one aspect. At the time of purchase the cost are hidden but the rewards are immediate. All manner of rationalizations are called upon to justify the purchase, some valid and others less. Now what would be really nice is if someone else would pay for my excessive purchases on my credit card. Then the costs would remain hidden for me forever. Alas that magic credit card does not exist. I will receive the bill on the credit card and have to make the payments. This not so in all respects to the medical care system.The insurance system as constructed allows for behavior that might not be rationally constrained or on the other hand may be irrationally constrained (very excessive deductibles for instance or limited access to procedures or scope of care). Cost as a measure of utilization in the insurance system is hidden from the user who has the good fortune of comprehensive coverage. Such a system has the unintended effect of promoting over utilization. Although raising the premium for coverage is one means of addressing utilization cost, the usual means of controlling cost for the insurance company are limiting reimbursement or exclusions to care.
Any health care (insurance) reform will need to address this utilization problem. The key understanding to be grasped is that the cost are hidden in many forms of insurance delivery systems. My question is how does the public insurance plan that the president endorses do that? This question will have major import into the way the government controls utilization or its costs. The president has said that he would prefer a single payer system if he was designing a system from scratch. Even in a single payer system utilization controls have to be part of the design.

More on efficiency and rewarding the outcome (Greek model ?) later.

Disclaimer: As a practicing physician I must inform you that I have been the recipient of payment for services from both private and government insurance programs. Also I feel obligated to inform you that if any of the above or past comments in these blogs constitute disinformation concerning health insurance reform as promoted by the the government you may report this blog to the Whitehouse at flag@whitehouse.gov .

Friday, May 22, 2009

Medical Care System

What kind of medical care system would you want to see in the future? The politician frequently speak of multiple urgent issues that need to be address. Some of these issues can be seen in the previous two posts and the references linked within them. However can we reduce these multiple issues to two core problems? The foundation for deciding what kind of medical care system we have revolves around two concerns of society and the practice of medicine. One is ethical and the other is economic.

Finding and implementing an answer to ethical question is more problematic because of the diversity and freedom of thought that is inherent in our western society. It is sometimes harder or less obvious than in other periods to define a dominant tradition in thought. The abstract form of this question is as old as western society and one that has never been universally successfully answered. The ethical question as it pertains to medical practice is what responsibility does society have to the individual for his medical care. Answer that question and you are half way toward deciding the type of medical care system. Be careful how you answer because I will warn you that if you step onto the tract of what 'the greatest good for the society' you have entered into the dark morass of morality and unending debate of the purpose of society verses the individual. I would recommend that you decide on the basis of your concern for the suffering and the helplessness of the individual. Leave aside thoughts of that individual's value to society.

The economic question is more straight forward but not without its conundrums. The question is whether your believe that medicine is a commodity or a right? (How you answer the economic question really only has two faces as long as you think you understand the difference between population variations and disease.)


An example of a conundrum in this area is perhaps important to consider before deciding. I was on the treadmill doing my thirty minute cardio workup (peak heart rate 155 to 160 ). There comes a middle aged women whose skin is dark and leathery appearing. In my judgment she had severely sun damaged skin. She was wearing a tank top and shorts an the dark tan was uniform across her body suggesting to me that this was not a occupational tan (ie she didn't darken because of working on asphalt road paving in the hot Mississippi sun). So here's the problem she faces thousands of dollars in dermatological anti neoplastic creams and plastic surgical excisions for skin cancer. Her 'disease condition' however is self induced. Does she have a right to care or should she purchase her remedies as a commodity?


Workout these two answers as succinctly as possible and then plug them into the grid of four possible choices and the medical care system of your choice will emerge. Listen to the debate in Congress and see if you can hear the variations of these themes in their arguments.

Thursday, April 9, 2009

Best Medical Care (cont.)

As I read the NY Times piece I was curious about the methodology that was used in the WHO report. The influence of methodology on results is well known to social scientists and even among true scientists. A quick search for an analysis of the World Health Report methodology revealed an illuminating article in the Journal of Public Health entitled The World Health Report 2000: Can Health Care Systems Be Compared Using a Single Measure of Performance? This article by J. S.Coyne and P. Hilsenrath looked at five of the main parameters of the Report. One parameter of particular interest was the DALE score. DALE is an acronym for disability adjusted life expectancy. DALE, if I understand the concept correctly expresses the years of life from birth that can be expected to be free of disability. It was this parameter which ranked the United States thirty seventh in comparison to other nations. This is not just lumped life expectancy from birth to death. I think it is very important to understand what DALE is and the factors that go into a DALE score. The most important point to understand is perhaps that a DALE score is influenced by both medical issues and public health issues.

For illustration, motor vehicle accidents are not a medical problem but may result in medical care, even prolonged medical care. Motor vehicle accidents are a big public safety issue and may result in disability. Air bags, seat belts, structural design of the automobile, impairment by alcohol and speed limits are safety issues as well. All of these issues of safety are public health issues. However one cannot segregate medical care of closed head trauma from public health of motor vehicle safety in the DALE system. Motor vehicle accidents are a factor in the DALE score and influence the measure. Yet, to state the obvious MVAs tend to occur prior to medical care for MVAs. So now the question arises what is the inflence of mixing public health issues and medical issues and comparing them across different cultures, levels of industrialization systems of societal organization and wealth. How are the performances in these sectors of public health and medical care related? Or is public health a matter of policy and medical care a matter of the contract between the patient and the care giver?