PNHP

Humana's flagrant cherry-picking,cream-skimming HealthMiles Plus program

Humana's flagrant cherry-picking,cream-skimming HealthMiles Plus program

Gathering focuses on state's health insurance woes Local leaders and national experts on healthcare met in Fort Lauderdale to discuss the growing problem of Floridians without health insurance.

By Bridget Carey
The Miami Herald
Nov. 10, 2006

Imagine getting frequent-flier miles for walking your dog.

Humana has recently made it a reality as part of a new way to encourage the growing number of Americans without health insurance to buy coverage.

It’s called HealthMiles Plus, and the more customers stay active, the more points they earn to turn into cash or miles with Humana’s partner, Virgin Atlantic Airways.

Elizabeth Bierbower, vice president of product innovation for Humana, showcased the recently launched GoZone, a device that plan holders wear to record how active they are. The information is then posted online, adding points to the person’s account.

The creation was designed to “attract people from the uninsured pool and try to give people back something who are purchasing health insurance,”
Bierbower said.

http://www.miami.com/mld/miamiherald/business/15975233.htm

Comment:

By Don McCanne, MD

Insurers do not market their products to the majority of the uninsured since most of them are not able to pay the premiums and many of them have preexisting disorders which would have an adverse effect on their risk pools and result in an upward pressure on their premiums. A small minority of the uninsured have above average incomes and are healthy. Insurers are interested in mining this population to select out these few who are healthy and can afford insurance.

Humana has now introduced the ultimate in cherry-picking and cream-skimming products. They are selling HealthMiles Plus to healthy individuals who not only claim to exercise regularly but are willing to prove it by wearing the GoZone physical activity recorder. Those who are not in great shape and do not have the income to pay the premiums need not apply.

In a remarkable show of chutzpah, this vice president of Humana has the gall to present a blatant cherry-picking program to a conference on addressing the problem of the uninsured, as if it were a solution.

We continue with policies that allow the private insurance industry to skim off the healthy who can pay the premiums, while we concentrate those with higher costs and fewer assets into the giant risk pool of the uninsured. This greatly compounds the difficulty of providing affordable, comprehensive coverage for the uninsured.

It is utterly absurd to continue to support policies that take care of the private insurers while rejecting policies that take care of those with health care needs. Private insurers do not want that business. Why should we let them continue to skim off the majority who are healthy and can afford their premiums?

The fundamental function of health insurance is to shift the costs of the few with needs to the many who are healthy, making health care affordable for everyone. Since the private insurers refuse to provide that service, we need to dismiss them and establish our own public, universal risk pool that would do precisely that.

No happiness with health policy

Conference leans toward national health care. Participants say crisis coming without changes.

By ANTHONY SALAMONE
The New Jersey Express-Times
Friday, October 20, 206

BETHLEHEM TWP., Pa. | The slide showed excerpts from a 2005 story about Toyota hiring automotive workers in Ontario, with the company citing the quality of the Canadian province’s work force.

“Everyone knows it’s crap,” said Dr. Walter Tsou. “The reason why they chose Ontario is because they don’t have to deal with the enormous health-care burden (compared with costs in the U.S.)”

Tsou joined two other guest speakers Thursday during Lehigh Valley Business Conference on Health Care’s 26th annual meeting at Candlelight Inn & Conference Center.

The meeting focused on national health insurance, and while many opinions arose during the meeting, which drew about 75 people, no one remedy emerged.

“That wasn’t the purpose,” said Kitty Gallagher, the organization’s president. “The purpose was to begin the discussion (locally).

“This is an issue that needs to be discussed; we can’t go on the way we are.”

Tsou’s, whose group, Physicians for a National Health Plan, supports a national insurance program, laid out how the current situation has left some 46 million people go uncovered.

Many businesses, including the former Bethlehem Steel Corp., have stopped subsidizing retirees’ benefits. Agere Systems Inc. plans to stop paying coverage beginning in 2008.

Tsou predicted more people will lose insurance and the system will worsen, unless businesspeople exert more influence in which way things should head.

He also said a national plan would foster competition.

“It gives the customer what he wants, and I believe the customer wants quality, affordable health care, ” said Tsou.

Jim Bentley with the American Hospital Association said the group also supports universal coverage with standards for determining what is “medically necessary,” among other factors.

Bentley and John Parker of Blue Cross and Blue Shield Association agreed serious problems exist, but opportunities have surfaced to build on some current programs. They include health savings accounts, which help individuals save for qualified medical and retiree health expenses tax-free.

Bentley also said since most people are healthy, they don’t comprehend the crisis, controversy or complication of health insurance.

“We have to help society understand what the current system is like, what the options are for the future, and what the trade-offs are,” said Bentley.

Anthony Salamone can be reached at 610-258-7171 or by e-mail at tsalamone@express-times.com.

As I see it: Act now to fix ailing health care system

By DR. COSIMO STORNIOLO
Gazette-Times
November 13, 2006

Everyone agrees that the health care system is broken. Almost 50 million Americans are uninsured; more than 600,000 of them in Oregon. Those who are insured pay higher premiums and deductibles and drug costs. Unpaid medical bills are the number-one cause of personal bankruptcy.

An under-funded Medicare entitlement program (with a new irrational prescription drug plan) will become insolvent in 2018; it will create unprecedented deficits this century. U.S. health indicators — such as infant mortality and life expectancy — fall far below other industrialized nations, despite the fact that we are spending more than 40 percent more per capita than any other country.

I witness this crisis on a weekly basis while working at Community Outreach’s free medical clinic for the uninsured. At every clinic, I see examples of acute and chronic illnesses left unattended by patients who cannot afford or access the health care system. This leads to unnecessary and costly complications.

More than that, I experience how the system is a dehumanizing social injustice and a shameful embarrassment for the most affluent nation on this globe. I have worked in some of the poorest areas of Africa and Latin America that, while lacking resources, still espouse a stronger public health approach and universal human right to health care.

The solution is government-administered national health insurance. Successful models of such a plan abound in countries such as Canada, Britain, New Zealand, Australia and Taiwan.

A single non-profit insurance plan would eliminate our current market-based and employer-based system, which squanders 30 percent of health care dollars on administrative costs, and only profits investors. These systems offer universal coverage, improved access, portability regardless of employment status or medical circumstance, and fewer barriers to choice of physician or hospital.

The health care delivery system that we are used to — your personal provider and hospital and pharmacy — would not change, only the way everyone was paid. Polls show that a majority of Americans and more than 40 percent of physicians support some form of a single-payer system.

So how can we afford it? Every reputable group that has examined the economics of a single-payer system — from the Government Accountability Office to the Congressional Budget Office to independent investigators — has concluded that the money saved from curtailing administrative waste and profits more than offsets the costs of expanding coverage to the uninsured.

What can we do locally?

• Support the Archimedes Movement, a program spearheaded by former Gov. John Kitzhaber. It aims to create public debate and to place a proposal before the 2007 Legislature in January.

• Join the Mid-Valley Health Care Advocates, our branch of Oregon’s “Health Care for All” program.

• Lobby your state and national representatives. There currently are proposals in Washington, D.C.; a new proposal by the Oregon Senate Commission and a plan by the governor’s Oregon Health Policy Commission.

• Read more from the Physicians for a National Health Program at www.pnhp.org, a group of concerned physicians with years of experience promoting single-payer national health care.

• Talk about it in the workplace, in the doctor’s office — to the newspaper.

The elections are over. Let’s turn our attention away from war and terror to a real social and ethical crisis in our country. Let’s put affordable and accessible health care at the top of our state and national agendas.

Cosimo Storniolo is a Corvallis physician.

Dr. Oliver Fein on healthcare costs and how to contain them

NJAFP Podcast #4, Healthcare costs and how to contain them, Dr. Oliver Fein 6/22/2006

This podcast is NJAFP Podcast #4, an excerpt of a recording of a panel discussion on healthcare costs and healthcare reform, sponsored by the New Jersey Academy of Family Physicians. This program was recorded June 22, 2006. The program is introduced by Ray Saputelli, executive vice president of the New Jersey Academy of Family Physicians.

Download the podcast file here (16.4mb mono MP3 file, 00:20:00 length). This podcast includes the presentation by Dr. Oliver Fein

Chant from an Ohio March

Courtesy of Dr. Johnathon Ross

I don’t know but I’ve been told
The fight for health care’s very old
Jesus on the Temple Mount
Drove the money changers out
He turned their tables with a kick
And then he turned and healed the sick
And so the churches join the fight
For health care as a human right

I don’t know but I’ve been told
The fight for health care’s very old
The unions stand up every day
For decent jobs with decent pay
And so the unions join the fight
For health care as a human right

I don’t know but I’ve been told
The fight for health care’s very old
The doctors and the nurses too
See the suffering just like you
And so caregivers join the fight
For health care as a human right

I don’t know but I’ve been told
The fight for health care’s very old
Even healthy people say
We might be patients too one day
And so the people join the fight
For health care as a human right

Dr. David Himmelstein on CNBC

Dr. David Himmelstein debating Michael F. Cannon from the Cato Institute on CNBC’s “On the Money”
Wednesday, September 27, 2006

Major impact of small shifts from adverse selection

Illustrating the Potential Impacts of Adverse Selection on Health Insurance Costs in Consumer Choice Models

Kaiser Family Foundation
Health Care Costs

Whenever consumers have a choice among different insurance arrangements, there is a tendency for people to choose a level of insurance based on their expected need for what is being covered (in this case health care). At any given price, people with a relatively high perceived need for the covered item are more likely to want coverage (and given coverage, more likely to want generous coverage) than people with a lower perceived need for the covered item. This is often referred to as “adverse selection.” Since high deductible plans generally are less generous than typical insurance policies — particularly for people with employer-sponsored coverage — some have raised concerns that CDHPs could disrupt the pooling of health risk in insurance markets.

To demonstrate that a relatively small share of enrollees can have a meaningful impact on average claims costs, we present an exercise using a database of medical claims complied by the Society of Actuaries.

What we can see from this exercise is that adverse selection can occur and have a meaningful impact on claims cost even where there are no extreme changes in enrollment. The enrollment shifts portrayed here would be far too small to substantially change the demographic make up of either pool in terms of age, gender, income, or other observable factors — even the 60%/40% scenario only increases the overall census of the adverse selection pool by 2%. Generalizations about enrollment would not reveal the real differences in underlying claim costs. If bias enrollment patterns such as these persist and insurers base premiums on claims experience, or if insurers can anticipate enrollment bias and base their premiums on expected claims, then these small enrollment differences would translate into fairly significant premium differences.

http://www.kff.org/insurance/snapshot/chcm111006oth2.cfm

Comment:

By Don McCanne, MD

This study demonstrates the simple fact that shifting a very few high-cost patients from one insurance pool to another (adverse selection) can have a very dramatic impact on the premiums that must be charged to cover health care costs for the pools.

This phenomenon is of much more concern now because of the greater use of cost sharing, especially though higher deductibles. People with needs will avoid those plans since they would be exposed to unaffordable out-of-pocket expenses. More comprehensive plans will attract the higher cost individuals, and the shift of only a few would make the premiums unaffordable. People with needs are being priced out of both coverage and health care.

Many policies have been suggested to eliminate adverse selection through risk adjustment. They don’t work. Separate high risk insurance pools have been established in several states to insure these people. They don’t work.
Medical underwriting is used in many states to be certain that pools can continue to exclude higher cost individuals, thereby ensuring that pooling will never work.

With a single, universal risk pool, adverse selection disappears. Why do we continue to avoid the inevitable?

PPOs' pattern of underpayment

Health clinics take steps to recover underpayments

by Robin J. Moody
Portland Business Journal
November 3, 2006

Fewer than 20 percent of medical practices nationwide — probably even fewer in Oregon due to the preponderance of small medical groups — conduct comprehensive reviews of payments.

By failing to audit bills, clinics are leaving money on the table.

Clinics that do conduct audits — including a handful that recently completed a pilot project to gather data on the underpayment problem — have identified clear patterns in billing errors.

Preferred Provider Organizations are the worst offenders, administrators said, especially those that lease their networks to out-of-state health plans.

Under PPOs, a network of medical providers charge on a fee-for-service basis, but are paid on a negotiated, discounted fee schedule.

A notable finding was the volume of underpayments with sums under $10, which are hard to spot without billing-audit software.

When Portland-based Women’s Clinic PC Administrator Marilyn Happold-Latham used such software, she was surprised to find consistent, albeit small, discrepancies in sums less than $10.

“There were underpayments of a few dollars, over and over again, for the same types of procedures or office visits,” said Happold-Latham.

Happold-Latham’s experience with underpayments prompted her to organize other administrators to perform manual audits. Three companies that completed the audits found numerous small discrepancies.

“Our personnel find the large mistakes, but without payment audit software you won’t find the $2 underpayments that come up time and time again and really add up,” said MaryKaye Brady, administrator for Metropolitan Pediatrics, which learned that the practice was underpaid by $77,000 in one year.

Because 65 percent of Oregon’s doctors practice in groups with fewer than 10 doctors, the cost of a billing-audit system many seem out of reach for many groups. As income levels decline for primary care doctors and stagnate for specialists, however, physician advocates say that auditing bills is an increasingly important business practice.

http://www.bizjournals.com/portland/stories/2006/11/06/story7.html?page=2&b=1162789200^1371308

Comment:

By Don McCanne, M.D.

The physicians signed these PPO contracts in good faith, assuming that they would be paid at the contracted rates. Apparently the PPOs feel that they are not constrained by good faith contractual terms. This policy of chiseling down the rates is particularly egregious when considering that overhead expenses are relatively fixed and that these reductions come directly out of the physicians’ paychecks. A two dollar reduction is a twenty-five percent reduction when the net income would have been eight dollars for the service provided.

If a government-run single payer program reduced compensation by two dollars, it would have done so, by design, only after negotiating and reaching an agreement with the providers. Apparently private insurers use market arguments to operate on a different ethical plane. If you are caught violating the terms of a contract, then the marketplace will take care of that. Or will it?

As long as we leave the private insurers in charge, we can expect the amoral or immoral ethics of whatever the market will bear. A public system would be held to a much higher ethical standard. Let’s go public!

Court upholds insurer's fine print

Health fraud suit is tossed

By Andrew McIntosh
The Sacramento Bee
November 8, 2006

A Nevada County Superior Court judge has dismissed a lawsuit filed by a Penn Valley husband and wife who claimed they were duped when they bought health insurance from a Texas firm and were plunged into a financial crisis after falling ill.

Judge Albert P. Dover rejected the claims of David and Darlene Henderson, saying they received exactly the benefits they signed up for when they bought a policy from Mega Life and Health Insurance Co. of North Richland Hills.

Dover suggested consumers must read the fine print before they buy any insurance policies, adding he saw no evidence that the insurer or its sales agents engaged in any fraud or made misrepresentations.

The California Foundation of Taxpayer and Consumer Rights… said Mega Life’s policies are so technical and riddled with jargon that the Hendersons were unlikely to have understood its limits if they had read it.

In 2001, Darlene Henderson became ill with breast cancer. David was later felled by an aortic aneurysm the size of a baseball and needed emergency surgery.

Those medical misfortunes left the Hendersons with more than $210,000 in medical and hospital bills.

Mega Life covered $33,428 of the Hendersons’ bills. The couple were left stunned and quivering when they learned they still owed more than $180,000.

Michael Heenan, a Sacramento spokesman for Mega Life and Health, said… “We work hard to make sure our customers have quality insurance and excellent service at prices they can afford.”

http://www.sacbee.com/296/story/73084.html

Comment:

By Don McCanne, MD

“Caveat emptor” is an axiom in commerce that the buyer alone bears the responsibility for purchasing decisions. As long as we leave the private insurance industry in charge, it is an axiom that applies to health care financing.

Wouldn’t it be much better to have automatic enrollment in a publicly funded and publicly administered health program devoid of technical jargon in fine print? Or is it more important to protect the forces of greed and deception that are unique to our American private insurance marketplace?

Time To Socialize Medicine

How Democrats can make themselves useful.

By Timothy Noah
Slate.com
Posted Wednesday, Nov. 8, 2006, at 4:33 PM ET

May I put in a word for socialized medicine?

The Democrats have won back the House of Representatives and may also have acquired a gossamer-thin majority in the Senate. They won by not being the party that bungled and lied its head off about the Iraq war. The common wisdom is that even if both houses of Congress become Democratic, the Democrats won’t be able to do anything more than bedevil the Bush administration with investigations rooting out incompetence and corruption (surely there’s more than enough to occupy the next two years), block Bush’s more ghastly judicial appointments, and drop any legislative initiatives Bush might attempt into a very dusty file.

But etiquette, if nothing more, requires that the Democrats also put forth some ideas about how they intend to govern, and the evidence suggests they don’t have any. It’s telling that, in a Washington Post story headlined “Democrats Promise Broad New Agenda,” the particulars of what that new agenda happens to be don’t appear until the 10th paragraph. I won’t bore you with what they are but will instead direct you to an entertaining rundown by Slate’s Michael Kinsley. Judging from Kinsley’s source document, an issues pamphlet put out by presumptive Speaker Nancy Pelosi, health care figures into the Democratic agenda only insofar as it affects stem-cell research, broadband access, the elderly, small business, and (most especially) the military. The question of how to repair America’s health care is addressed with strikingly little audacity (and even less specificity) in The Audacity of Hope, the new tome by Democratic heartthrob Sen. Barack Obama of Illinois.

None of this is any accident. The last big attempt to reform the health-care system is widely believed to have lost the House for the Democrats back in 1994, and many would say it’s perverse to bring up the subject mere hours after the Democrats finally got it back. The conviction that the United States government is capable of achieving anything has surely been hit hard by the Iraq war. I doubt that government takeover of the health-care system would poll well. Politically, the issue would seem a very impractical one to place at the center of the Democratic agenda.

But there are many categories of practicality in this world, and the political type is highly susceptible to changed circumstance. There are also the practical questions of how to make sick people well and how to pay for it. These are matters that health insurers, hospitals, and doctors have been fighting over for decades, and the battle has left the health-care system in a state that a wealthy and civilized society can no longer tolerate.

Have you been inside a hospital lately?

The signs of breakdown are everywhere, from the emergency room overflowing with uninsured people to the film labs unable to locate MRIs that cost thousands of dollars to produce (usually because a doctor misfiled them) to the medical chart whose privacy is guarded so fervently that the patient may need a law degree to get his hands on it, only to discover that results of his last three blood tests never made it out of the fax machine. (Before she died of liver cancer, my wife found that the only place she could read her medical chart unmolested was the hospital ladies’ room.) The National Academy of Sciences estimates that 3 percent to 4 percent of all people admitted to hospitals end up suffering some sort of injury due to medical error and that the number who die as a result may approach 100,000 annually, which exceeds the number of people who die annually in car crashes. The problem isn’t incompetent doctors or medical technicians; it’s the seat-of-the-pants way medical care must be delivered under the current jerry-built system. By comparison, your local Department of Motor Vehicles is a model of efficiency and cheery service.

None of this comes cheap. Assuming you aren’t one of the 43 million Americans lacking any health insurance, the policies your employer provides you—it’s rarely the same one for more than three or four years—are becoming rapidly more expensive, often in maddeningly tricky ways involving intricate rules about minutiae like which lab your doctor happens to use. (The most elaborate ones are labeled “consumer choice” plans and are based on the fiction that you can know in advance whether you’re ever going to get sick.) This past August, Steven Greenhouse and David Leonhardt observed in the New York Times that America was experiencing its “first sustained period of economic growth since World War II that fails to offer a prolonged increase in real wages for most workers.” Corporate greed was apparently one cause, since wages and salaries represented the smallest share of the gross domestic product since 1947, while corporate profits represented the highest share since the 1960s. But the more significant factor, I’ll bet, was the rising cost of health-care benefits, which have more or less abolished raises. These days the only incentive most workers have to boost productivity is fear of a pay cut.

Market-based solutions to the crisis are, it should be obvious by now, a distraction. Paul Krugman and Robin Wells summarized the problem in a March 2006 New York Review essay:

[I]magine an insurer who offered policies to anyone, with the annual premium set to cover the average person’s health care expenses, plus the administrative costs of running the insurance company. Who would sign up? The answer, unfortunately, is that the insurer’s customers wouldn’t be a representative sample of the population. Healthy people, with little reason to expect high medical bills, would probably shun policies priced to reflect the average person’s health costs. On the other hand, unhealthy people would find the policies very attractive.

You can see where this is going. The insurance company would quickly find that because its clientele was tilted toward those with high medical costs, its actual costs per customer were much higher than those of the average member of the population. So it would have to raise premiums to cover those higher costs. However, this would disproportionately drive off its healthier customers, leaving it with an even less healthy customer base, requiring a further rise in premiums, and so on.

Insurance companies deal with these problems, to some extent, by carefully screening applicants to identify those with a high risk of needing expensive treatment, and either rejecting such applicants or charging them higher premiums. But such screening is itself expensive. Furthermore, it tends to screen out exactly those who most need insurance.

In theory, when insurance companies tinker with co-payments and deductibles, they put the brakes on health-care costs by pressuring consumers to avoid frivolous visits to the doctor. In practice, frivolous visits to the doctor are comparatively rare and confined to a few hypochondriacs and hysterics. Going to the doctor is, after all, a fairly unpleasant experience. When people are pressured to avoid seeing the doctor, what happens is that their health suffers. This isn’t rocket science.

Krugman and Wells (whose essay ought to be read, I’m not kidding, by every American) displayed a chart telling the familiar tale that the United States spends about twice what Canada, France, and the United Kingdom do on health care (all three have socialized medicine) yet ranks lower than these countries on life expectancy and higher on infant mortality. There’s no question that the United States practices the most advanced medicine in the world, but that doesn’t translate into a healthier population. The problem isn’t the science; it’s the boring stuff, like the size and variety of the cohort that’s insured, and the availability of computerized medical records, and the price tag for a visit to the doctor. Writ large, it’s the inability of the health care system to benefit economically from improving the long-term health of its customers. This is a job private industry can’t do.

It’s a given that the government will be forced to take over health care. Just about every doctor I’ve ever questioned on the subject has said so, even though one consequence may be that doctors will lose income by becoming salaried employees rather than fee-for-service entrepreneurs (a system widely agreed to have increased the number of unnecessary and sometimes dangerous medical procedures). Will the cost be prohibitive? Obviously if more people have access to medical care, that will push costs up. At the same time, though, eliminating the ever-more-elaborate financial game-playing between insurers, doctors, and patients would save an enormous amount of money, and so would eliminating costly medical care required when a patient has failed to receive preventive care, which is comparatively inexpensive. Medicare, Medicaid, and the Veterans Administration all have their faults, but they all manage to deliver health care more cheaply than private insurance, and the VA, which actually employs doctors and owns hospitals, is widely understood by experts to provide better care than private hospitals do. Krugman and Wells note that when Taiwan switched to a single-payer system in 1995, overall health-care costs went down:

[T]he percentage of the population with health insurance soared from 57 percent to 97 percent, yet health care costs actually grew more slowly than one would have predicted from trends before the change in system.

The practicalities of politics may shun putting socialized medicine at the center of the Democratic agenda. But the practicalities of life demand it and will soon reverse the political calculus. People are dying, and corporations are going broke. Let’s get started.

Timothy Noah is a senior writer at Slate.

Article URL: http://www.slate.com/id/2153275/

Elections and health care reform

Voters and Health Care in the 2006 Election

By Robert J. Blendon, Sc.D., and Drew E. Altman, Ph.D.
The New England Journal of Medicine
November 2, 2006

Whichever party wins in the November congressional election, the margin of victory is likely to be small, and for this reason, the outcome of the election will have only a limited effect on the current direction of national health policy. The new leaders of the Congress will have to deal with the problems of scarce new federal revenues, a deep partisan division over the direction of health policy, and resistance by many conservative members to new plans for health care spending. In addition, as the presidential election of 2008 approaches, opposition by members of each party to the other’s health care proposals will intensify. In this environment, important new health reform initiatives are unlikely, and the congressional focus will be on incremental policy changes.

http://content.nejm.org/cgi/content/full/355/18/1928

And…

Health Reform: Time For A Wake-Up Call

By Drew E. Altman and Robert J. Blendon
Health Affairs Blog
October 30th, 2006

For health reform to again gain a foothold at the top of the national political and policy agenda, it needs to become a central issue in the 2008 election campaign, so that candidates who are elected to office and the new president feel that they were elected, at least in part, to address the nation’s big health care problems when they start work in 2009. This is by no means guaranteed, but there is a scenario under which it could happen.
First, if we are fortunate enough to see external problems like Iraq stabilize or subside and no new big ones arise, health would have the opening it needs to compete for center stage as an election issue. Second, as Americans pay more and more each year out of their own pockets for health care, they will become increasingly concerned about health as a voting issue and policy priority.

But what health needs most to rise up in American politics is for national political candidates, whether from the political left, right, or center, to begin talking about the issue again as they did in the early nineties. Most important of all are the presidential candidates, who receive so much national media attention. If even one major candidate begins to seriously address health reform, the others will be forced to follow suit. The presidential candidates’ level of attention to health will be decisive to where health ranks on the national agenda going into the 2008 election and
2009 Congress. If they do play a leadership role on health, the media will follow, and the agenda-setting power of a debate driven from the top will meet the public’s concerns rising up from the bottom like two weather fronts colliding.

http://healthaffairs.org/blog/2006/10/30/health-reform-time-for-a-wake-up-call/

Comment:

By Don McCanne, MD

So this election wasn’t about health care reform, but the next one can be. Get to work!

Toyota's health cost cure: A clinic at the plant site

With tab of $11,000 per U.S. worker, automaker will invest $9M in San Antonia facility

By Christine Tierney
The Detroit News
Wednesday, November 08, 2006

Detroit’s automakers are not the only ones grappling with soaring health-care costs. They are becoming an issue for Toyota Motor Corp., as well, as the Japanese giant expands its U.S. manufacturing operations and work force.

“Our health care costs have doubled over the past five years,” to more than $11,000 a year per U.S. plant worker, said Ford Brewer, assistant general manager for health and wellness at Toyota’s North American manufacturing headquarters.

In designing its newest plant, in San Antonio, Toyota is trying to tackle the problem by building a clinic at the factory to provide a wider array of treatments and services than a typical factory medical office.

The workers at the San Antonio pickup plant can have their eyes checked and their teeth repaired at the $9 million clinic, which also offers pediatric services, laboratory tests and physical therapy.

“This is a major step beyond what we’ve done before,” Brewer said.

The move, however, is consistent with Toyota’s bedrock principle of kaizen, or continuous improvement.

“Typically we reduce costs by improving quality,” Brewer said. “That’s the same thing we’re doing here.”

By offering better primary care and preventive medicine, Toyota expects to rein in its health-care expenses.

Companies that have adopted this approach tend to spend more for primary care and drugs, but that increase is more than offset by a drop in costly hospitalization and specialty care expenses, Toyota said.

The San Antonio clinic is the first of its kind at Toyota, said plant manager Hidehiko “T.J.” Tajima.

“It’s for employees, their families and for suppliers. If it’s successful, we’ll spread the concept to other plants.”

Toyota will employ 2,000 workers at the truck plant by spring, while suppliers on the site will employ 2,100.

Toyota will gauge the success of the clinic by monitoring employees’ health-care indicators, such as smoking-cessation rates and blood-pressure levels, and by tracking expenses.

“From a cost control standpoint, it certainly makes sense,” said Ronald Harbour, president of Troy-based Harbour Consulting Inc., which specializes in manufacturing.

U.S. automakers are deeply frustrated by the rapid increases in health-care costs. In addition, “they feel they have very little control over the cost and over how effectively the money is spent. This is one answer,” Harbour said.

An on-site clinic also is likely to reduce the absenteeism rate.

While a clinic a few minutes from the assembly line may seem convenient to many workers, others may worry about their privacy, some auto industry experts say.

Ford Motor Co. operated a clinic at the Rouge plant in the 1950s that offered basic health-care and dental services. “There used to be a bed ward where employees were kept overnight,” said William Heckman, executive physician at Ford Motor Co.

“The trend has been to move away from doing personal care, to focusing on occupational injuries, as employees got better health-care coverage,” he said.

Ford believes most employees prefer to go to their own doctor.

Honda Motor Co. also encourages employees to choose their doctors, although it has two wellness centers at plants in Ohio offering physical therapy, massages, and exercise and nutrition classes to encourage workers to stay healthy and fit.

Toyota would not require San Antonio workers to go to the on-site clinic, but it encourages them to do so by charging higher co-pays and deductibles for workers who choose to go elsewhere.

“Is that like Big Brother providing my health-care? We had to deal with similar concerns with our pharmacies a couple of years ago,” Brewer said.

When Toyota installed pharmacies at U.S. plants to lower its drug costs, some employees expressed concerns about their privacy.

But now more than 80 percent of the drugs purchased by employees are bought from the plant pharmacies or the mail-order service, Brewer said.

A spokesman for the United Auto Workers union declined to comment specifically on Toyota’s program.

“The primary concern of our members is that the interest of the patient always comes first in any health care delivery system,” said UAW spokesman Roger Kerson. The UAW believes that a comprehensive national health insurance program, as Japan and other industrialized countries have, is the answer to the U.S. health care crisis.

While Toyota is intent on holding down health-care costs, company officials say the system also will benefit employees.

“We want to provide high-quality care,” said John Runge, manager of human resources for the Texas plant.

The clinic’s physicians will not be remunerated on the basis of how many patients they see — a payment method that encourages doctors to see as many patients as possible.

Whereas studies show doctors spend around seven minutes on average with patients in the United States, the San Antonio clinic will allot 20 minutes for a visit with a doctor.

“If a doctor spends 20 minutes with a patient, he’s likely to know more. There’s a major focus on prevention,” Brewer said.

The clinic, which will be operated by CHD Meridian Health Care, will initially employ two full-time doctors and one part-time, but expects to increase that to as many as seven doctors when the plant is fully staffed.

You can reach Christine Tierney at (313) 222-1463 or ctierney@detnews.com.