PNHP

Obamacare Will Not Fix Health Care

Obamacare Will Not Fix Health Care

A single-payer program in Utah will lower costs and improve quality of medical services

By Joseph Jarvis, M.D.
City Weekly (Salt Lake City), May 23, 2012

This year on Valentine’s Day, I joined 49 other physicians from across America in signing an Amicus brief asking the U.S. Supreme Court to overturn the Affordable Care Act (Obamacare). Among these 50 physicians, I was the only one with a conservative political leaning. Despite the others’ more liberal/progressive leaning, they agreed with me that the individual mandate is unconstitutional. More importantly, we agree that Obamacare does not address the central problem with the American health-care system, which is its extraordinary cost. We also agree that the only way to really reform our sick health-care system is to radically change the way we Americans do health-care business.

Despite my more conservative politics, I join the other physicians in proposing single-payer health-system reform.

The Affordable Care Act fails to address the cost of American health-care delivery because the central feature of Obamacare is the forced reliance on the private health-insurance-industry business model, known as the individual mandate. Private health insurance is the most wasteful way to pay for health care ever invented, with excess administrative costs in the United States of about $400 billion per year. In addition, the private health-insurance business model distorts incentives in health-care delivery. This induces mediocre care — it pays for inappropriate care and ignores patient safety, while failing to consistently use clinically proven interventions. These poor-quality problems in the United States health-care system cost an additional $700 billion per year in wasted payments.

I have been the leading voice for single-payer health-system reform in Utah for 15 years. Since 2009, I have chaired the Utah Healthcare Initiative (UHI), a registered political-issue committee created with the sole purpose of bringing comprehensive, sustainable health-system reform to the ballot in Utah. Once Obamacare fails — either through action by the Supreme Court, or later, when its exorbitant costs can no longer be borne by the taxpayer — Americans will once again be faced with the need to reform our failed health system. This next time, we must do the job right.

We, at UHI, propose radical reforms uniquely suited to Utah, which take advantage of the best aspects of health-care delivery already present in the Beehive State. We have the nation’s lowest per-capita health-care cost, in part because we have some of the nation’s highest-quality hospitals and associated clinics (IHC and University Hospital). We also have one of the nation’s most efficient private payers for health-care services — the Public Employees Health Plan (PEHP).

PEHP has an overhead cost consistently less than 4 percent, substantially below the Utah industry average of 15 percent. PEHP is a private, nonprofit trust fund operated for Utah public employees and their dependents. UHI proposes to convert PEHP to the sole payer for health-care services for all Utahns and rename it the Utah Health Cooperative. Immediately upon passage of the ballot initiative enabling this transformation, the Utah Health Cooperative would begin offering a health-benefit program to all residents of Utah while beginning the process of merging with all public health-care programs (Medicaid, CHIP, etc.) Private health insurers would have two years to phase out their Utah operations.

The Utah Health Cooperative would negotiate to become the fiscal agent for Medicare in Utah, anticipating the time when Medicare beneficiaries living in the Beehive State could be phased into full participation in the program. The most important function of the Utah Health Cooperative, aside from receiving and managing all funds intended to support health services in Utah, would be to use its monopsony clout to improve health-system function, including better use of primary care, improved distribution of public health, optimizing behavioral-health services, negotiating better prices for pharmaceuticals and medical devices and supporting continuous quality improvement system-wide.

UHI would also create a new government regulatory/adjudicatory agency: the Utah Health System Commission. The Utah Health System Commission will have two principal tasks: 1. Define the clinically proven set of health benefits for every citizen in Utah; and 2. adjudicate claims against any part of the health system efficiently. The commission will be given two years after passage of the enabling statute to determine what diagnostic and therapeutic interventions have been proven effective by clinical science while being the least expensive alternative. These interventions will constitute the initial Uniform Benefit for all Utah residents.

The commission will have the task of continuously reviewing clinical science as it evolves to keep the Uniform Benefit updated. The commission will also organize an administrative law system, similar to the system that handles claims about workplace injuries and illnesses, for the purpose of adjudicating claims against any part of the health-care system, such as malpractice. The principal features of this administrative-law system will be that no punitive damages will be allowed and no jury trials will be conducted.

The bottom line is simple. The Affordable Care Act is probably unconstitutional. In any event, it was never affordable, because it never attacked the real problem with American health care: high cost due to inefficiency and poor quality. Whether or not the U.S. Supreme Court strikes down the individual mandate, Obamacare will fail, good intentions or no. As that happens, the Utah Healthcare Initiative is prepared to lead the heavy political lifting that’s needed for health-system reform — done by Utah voters for Utah patients, through the ballot initiative process.

Dr. Joseph Jarvis trained in family medicine, public health and environmental medicine at the University of Utah. He chairs the Utah Healthcare Initiative, a registered political-issue committee devoted to sustainable health-system change through the ballot. For more information on the UHI health-system reform, visit UtahHealthCareInitiative.com/Solutions.

http://www.cityweekly.net/utah/article-444-15956-obamacare-will-not-fix-health-care_-by-dr-joseph-jarvis.html

VA To Invest Billions in Open Source Transition

By Roger A. Maduro
Open Health News, May 20, 2012

The open source strategy of the U.S. Department of Veterans Affairs (VA) was the focus of the recent Open Source Think Tank Conference in Napa, California held April 12-14. This conference, sponsored by the Olliance Group and now on its 7th year, has become one of the premier open source gatherings in the world. Top IT leaders of the VA came to the conference to ask for the advice of the open source community in finalizing the VA’s strategy for the future of its world-class electronic health record (EHR) system, VistA.

In addition to the VA’s case study, participants at the conference also looked at the Genivi Alliance, a non-profit industry association whose mission is to drive the broad adoption of an In-Vehicle Infotainment (IVI) open source development platform. Unlike any other conference I have attended, it isdesigned to foster intense and broad interactive discussions of critical open source developments. At the core it revolves around an examination and discussion of the open source case studies at each conference.  In addition to the case studies, there were a series of really interesting presentations and panel discussions. These included one by Chris Vein, Deputy CTO for Innovation, Executive Office of the President, and Paul Cormier, Executive VP of Red Hat’s ProductsDivision.

The objective of the conference is to provide representatives of the projects being studied with the best open source advice possible to help them address some of the critical issues that their projects are facing. Participation at the conference is by invitation only and it is limited to 135 participants. The participants represented a broad range of open source expertise and projects, including some of the best known open source luminaries. What makes the Open Source Think Tank conference so unique was described very well in a blog post by Dave McAllister, Director of Open Source and Standards (OSS) at Adobe Systems.

VA Transitioning to Open Source

The VA is in the middle of a massive change in the way that it continues to develop its EHR. VistA has been developed by the VA’s own internal development staff over the past 35 years. As documented by the well-known journalist Phillip Longman in his book “Best Care Anywhere: Why VA Health Care Would Work Better For Everyone,” VistA was developed with the full participation of the medical staff at the VA, including doctors, nurses and clinicians in an open-source, collaborative effort with the developers. VistA has been one of the key elements of the transformation of the VA from a mediocre healthcare system to what is unquestionably the best healthcare system in the United States today, by every measure of quality.

The VA was represented by its CIO, Roger Baker, its CTO, Peter Levin, and Mike O’Neill, Senior Advisor to the Director, VA Innovation Initiative. Previous to the conference O’Neill wrote a blog post titled “Why Would Government Launch an Open Source EHR Community?” where he explained why a U.S. government agency would develop an open source strategy and take the unusual step of addressing such a gathering of open source experts. As O’Neill stated in the blog post, “while VA has many talented developers, a strictly internal focus on EHR innovation is not enough. Tapping the larger community of EHR users, developers, and service providers is key to unlocking the potential to rapidly advance the technology,” adding that “in searching for models where a diverse group of participants can collaborate, share innovations, build businesses, and advance the state of technology to the benefit of all participants, the world of open source software development provides many successful examples.”

In addition to the senior IT leaders of the VA, Dr. Seong Ki Mun, well-known advocate of open source in the medical field, also participated in his role as the Chief Executive Officer of OSEHRA (the Open Source Electronic Health Record Agent). This is the organization created last year by the VA to build a private sector ecosystem for the continuing development of VistA. OSEHRA has grown by leaps and bounds and now has over 900 members. The composition of its membership makes the organization rather unique. As one would expect, its membership includes individuals, corporations and academic institutions. But it also includes multiple Federal government agencies and several US States. In the future it may also include foreign governments and government agencies and institutions.

I should add that OSHERA does not focus only on VistA. Many companies that have developed open source technologies in the health field are joining the organization. One of its most active members, for example, is Kitware, which has developed an entire array of open source tools for imaging, radiology and visualization. These tools have already demonstrated a quality that is equal or superior to any proprietary product in the market. One can easily see that over time OSEHRA can become a central point not only for the development of the VistA EHR,  but also for all the open source software that runs medical devices.

Besides the VA and OSEHRA representatives, there were several other VistA experts in the audience. These included Ed Meagher, former Deputy CIO of the VA, now with SRA International and Robert Missroon, COO of DSS, Inc., one of the leading VistA solution providers in the private sector. Then, of course, there was me.

Dr. Robert Wah, Chief Medical Officer of CSC and one of the most respected physician executives in the US also attended the conference.  Prior to joining CSC, Dr. Wah served as the acting Deputy National Coordinator for Health Information Technology at the Department of Health and Human Services (HHS). He also worked for the Military Health System (MHS) in the Office of the Secretary of Defense as the Associate CIO and Director of Information Management.

Missroon came to the conference wearing several hats. He represented the VistA community, particularly the for-profit solution providers implementing VistA. He also spoke for the community of vendors that sell software to the VA. Years ago DSS developed a platform that allows them to adapt proprietary add-ons and enhancements to work with the VistA EHR system. DSS currently supports software enhancements to VistA from more than 100 vendors who sell to the VA, as well as more than 35 packages they have developed themselves. This is a critical constituent to the VA’s open source strategy and DSS will clearly play a major role in educating these vendors to the advantage of the VA’s open source strategy (currently this particular group is nearly hysterical since most VA vendors equat
e open source to the viral GPL license and are afraid of losing their intellectual property).

DSS has been a pioneer in the effort of open sourcing VistA. Four years ago it joined Open Health Tools (OHT), the leading organization in the open health field, and has contributed its version of VistA to OHT under the commercially-friendly Eclipse license.  I should add that OHT has played a critical role in building the open health ecosystem, including the VistA community. OHT is led by Skip McGaugey, co-founder and former chairman of the Eclipse Foundation, and Robert M. Kolodner, former CIO of the VA and former Health IT Czar during the Bush administration.

DSS’ version of VistA, known as vxVistA, contains over $6 million worth of enhancements that have been contributed by DSS to the open source community. More recently DSS contributed this entire code base to OSEHRA. In addition to their code contribution, DSS created vxVistA.org, a portal site to host the vxVistA code, plus commercial add-ons and enhancements to VistA developed by DSS and other solution providers. The code portal site also contains a wealth of VistA ranging from tutorials and documentation to their popular vxJourney webinar series where leading VistA experts are interviewed on a regular basis.

How the Think Tank Looked at the VA Case

The effort the VA is undertaking is very complex, and in fact, it is the largest open source effort by any government agency in the world today. What they are seeking to do has never been done before. Thus, seeking the advice of leaders from the open source community was a very smart idea. Before discussing the questions raised by the VA team, it’s best to examine how the Open Source Think Tank approached the case studies.

The agenda was very structured. Each team representing one of the two case studies, the Genivi Alliance and the VA open source strategy, had an initial half-an-hour to present an overview of the case. All the conference participants had received a set of 5-6 questions that each team wanted answered. After the initial presentations, the audience was split into 12 groups with somewhere between 9-12 participants each. In addition, Andrew Aitken, host of the conference and founder and managing partner of the Olliance Group, mixed the audience groups in such a way that the groups working on the Genivi Alliance questions had different participants from those working on the VA case study. That is one of the great things about the Think Tank conference. All the participants get a chance to work together and get to know a large number of other participants.

Once the groups were set, each group had a chance to spend two hours collaboratively working on answering the questions for each case study. So on Thursday, the first day of the conference,  the groups worked on the first set of questions the VA wanted answered. On Friday, the second day of the conference, the groups focused on the other set of questions. On Saturday, the person picked as group leader gave a five-minute presentation to the entire audience, summarizing each groups’s key recommendations. Thus, on Saturday, both the Genivi Alliance and the VA teams heard a full hour of presentations with specific recommendations. The effort and creativity that went into these was remarkable. Some were very straight forward, while others were full multi-media presentations. A winning group was then picked for each case (this year the winners received tablet computers as a prize for their efforts).

In addition to all the advice the VA team received during the formal case study discussions, they also had the opportunity to spend a significant amount of time having one-to-one discussions with other participants at the conference.

The VA Case

During the initial presentation, the VA team, Baker, Levin, and O’Neill, outlined the current situation and raised some of the specific key objectives that the VA has identified. The one part of the presentation that certainly caught everyone’s attention is that the VA has an estimated $5 billion to invest in the development of VistA over the next several years. One of the key issues the VA is looking at is how to most efficiently allocate that money.

The VA is focused on investing this development funding as a long-term investment so that it not only provides VistA with a whole set of enhancements, but at the same time solidifies the open source ecosystem which can then contribute a larger share of enhancements to VistA over time. This is really key to the strategy. Moving into the future, the VA wants to leverage the creativity of the private sector and the VistA community to jointly enhance the EHR. This will represent huge savings to the VA in the medium to long term while keeping up with the most advanced EHR developments. It will also serve to teach other US government agencies the most productive way to invest their software development resources.

In order to transition to this new collaborative development model, one of the immediate objectives of the VA is to move all future development of VistA to the open source OSEHRA core. This has all kinds of ramifications, from how to manage vendors to how to get the internal development teams in the VA to work with OSEHRA (the VA has over 1,300 developers and between 5,000 to 10,000 physicians and nurses who volunteer their time to enhance VistA). In addition the VA needs to bring the external VistA community and private sector into the fold.

Another key point raised by the VA team was, “What is the best way to work with the Military Health System to make this effort a success?” Collaboration with the Military Health System (MHS) may in fact be the greatest challenge faced by the VA, as there are profound differences between the way the VA and DoD have approached the development and deployment of EHR systems.

The VA had five sets of questions broken into the following areas:

  1. Transition
  2. Common Code Base
  3. Focus and Breadth
  4. Licensing Strategy
  5. Cultural Change

In response to the VA’s questions, the audience offered some terrific recommendations. We hope to present a detailed review these in a future article. The event organizers are currently assembling the recommendations together and will post them when ready.

However, I would like to note that there was one clear and unambiguous recommendation to the VA from the conference participants. Question number 4 was focused on the VA’s Licensing Strategy. The preamble stated, “Recognizing that EHR implementations may include both open and proprietary software, and that priority must be placed on commercial participation in a nascent market, OSEHRA chose a permissive open source license. Some community members believe strongly that a reciprocal license is required to enable constructive collaboration and accelerate innovation.” Then the VA asked specifically: “What licensing strategy can best promote the community and market development that will advance EHR technology to the benefit of users?”

In response to that question, each group offered the exact same recommendation—that the VA use the commercially-friendly Apache license for VistA. In other words, all groups working separately came to a unanimous recommendation. Seldom does one come across such a clear message from such a diverse group of people, particularly in the open source community.

For the past decade the VistA community has been bitterly divided over licensing issues. As reported by Open Health News in this article, this issue was finally settled by the majority of the VistA community during the last VistA Community Meeting in Sacramento, CA, in January of this year. Unfortunately, a handful of staunch advocates of the GPL continue to place obstacles to community collaboration by insisting on using the GPL regardless of the consequences. Based on MUMPS platform/database/programming environment, VistA is in a peculiar situation in that it is basically impossible to add enhancements and add-ons to the code without mixing that code with the core code.

This means, for example, that any hospital that implements a GPL version of VistA will be unable to purchase any commercial add-ons or enhancements to the platform. This issue can be resolved by the simple expedient of using a commercially-friendly open source license. Hopefully, the GPL advocates in the VistA community will finally get the message, as a large number of the conference participants who told the VA to use the Apache license are generally advocates of using the GPL license.

Scope of the VistA Community

It was fascinating to observe leaders of the open source community at-large realizing the size and scope of VistA. This was a significant revelation to the majority of the conference participants. Even so, the VA team did not have time to really provide the full scope of the project. If there is one issue I had with the conference, it was that the half-hour initial presentation was simply not enough to cover the full scope of the project. At least for the VA. I do think it was enough time for the Genivi team’s presentation.

Since we will be examining the recommendations in a future article, I’d like to take the time now to provide a more extensive background to the scope of the VistA community for our readers.

Let’s start with the VA itself. The VA is the largest healthcare system in the United States and treats 8.5 million veterans every year. It operates 152 hospitals, over 800 clinics and 288 veteran centers that include retirement homes – not to mention over 140 VA nursing homes. Over 300,000 staff work at VA healthcare facilities across the country including physicians, nurses, technicians, clerks, students, volunteers, and contract staff. Due to its close relationship with all major medical schools in the country more than half of all medical students do their residency programs in VA hospitals (where they all learn to use VistA).

As documented in Longman’s book, “Best Care Anywhere,” the VA has been a leader in the development and implementation of EHR systems. By the end of 1996, nearly 100% of VA facilities were using the VistA EHR. In comparison, 16 years later, less than 4% of private hospitals in the U.S. have fully implemented EHRs.

In terms of the level of EHR implementation, the HIMSS Analytics organization has a ranking system that goes up to Stage Level 7. Curiously enough, HIMSS Analytics has never reported the Stage Level for the VA hospital system. However, going by the HIMSS Analytics definition, the entire VA healthcare system has been at HIMSS Stage Level 7 for well over a decade. Not a single private sector hospital system in the U.S. had met that criteria until three years ago.

The core of VistA was developed internally at the VA by its own people, following their own internal form of an open source collaborative development model. VA’s physicians, nurses and clinicians have been the drivers of this development from the beginning. They ensured VistA was developed as a tool to help them care for their patients. This goes beyond collaboration. Early on, the VA discovered that it was a lot easier to train clinicians to become programmers than to train programmers to think like clinicians. Thus, many software developers in the VA came from the ranks of its clinicians. All the code developed internally by the VA, using taxpayer’s money, has been released as public domain software. The value of this code is in the billions of dollars.

There is a whole other side to VistA which is not well known. A “sister” EHR system, known as the Resource and Patient Management System (RPMS), was developed and is being used by the Indian Health Service (IHS). IHS is an agency within the U.S. Department of Health & Human Services (HHS) that is charged with administering the principal healthcare program for American Indians and Alaska Natives and provides comprehensive health services through a system of Federal IHS, tribal, and urban-operated facilities and programs. These facilities and programs provide health services to 1.8 million American Indians and Alaska Natives through 144 service units composed of over 600 direct healthcare delivery facilities, including 49 hospitals, 219 health centers, 7 school health centers, and 362 health stations, residential treatment centers, satellite clinics, and Alaska village clinics.

IHS’s decision to use VistA (previously known as DHCP) as the core of RPMS goes back to 1984. Facing exceedingly tight budget constraints, IHS made a crucial decision to leverage the VA’s investment in VistA, developing outpatient and longitudinal record packages to complement the VA’s inpatient-centered software. This has resulted in what may be the closest and most fruitful long-term collaboration between two Federal agencies on record. In fact, some of the major improvements in VistA actually came from IHS. The model of care at IHS and Tribal facilities is more similar to small private sector hospitals and Federally Qualified Health Centers (FQHC) clinic settings than the VA and DoD. For this reason RPMS is a better choice than VistA for physician offices and clinics, while VistA is a better choice for hospital systems.

Speaking at the 24th VistA Community Meeting, Howard Hays, acting CIO of IHS, reiterated his agency’s commitment to continue working with the VA.  He told the audience that IHS is very excited about the OSEHRA open source approach. He said that IHS was working out an agreement with OSEHRA so that it can become a full participant in the organization. One point that Hays made is that OSEHRA offers the potential for a collaborative and transparent development space that could be shared by Federal and contracted developers as well as the OSEHRA community at large. According to Hays, being part of OSEHRA will allow IHS (known in Washington as “the little agency that could”), to leverage all the contributions made by other government agencies as well as the open source community.

Going beyond Federal government agencies, there are now hundreds of other VistA implementations around the world. It is known to be running in clinics or hospitals in over 30 countries. As an open source project, total numbers are hard to come by, as any adopter can download and implement it without telling anyone. In addition there are multiple derivatives of VistA. For example, 65% of the hospitals in Finland are running an EHR that’s a direct derivative of VistA (DHCP). The Finish Government helped implement a derivative of that derivative in major medical teaching hospitals in Nigeria (the name of the VistA-derivative in Nigeria is MINPHIS, which stands for “Made in Nigeria Physician Health Information System”).

In the United States, VistA has been adopted by a large number of community and State hospitals and clinics. The State of West Virginia, for example, successfully implemented VistA in its 9 State hospitals. In addition, the Community Health Centers of West Virginia implemented RPMS in more than 40 clinics. They are now collaborating on an open source Personal Health Record (PHR) and heal
th information exchange systems which allow them to exchange their patient records and share them with their patients in real time.

In addition to West Virginia, the State of North Carolina is currently implementing VistA in their mental health treatment centers, from clinics to hospitals. Oklahoma has VistA running in all of its State Veterans Hospitals. In January the New York State Office of Mental Health (OMH) released an RFPseeking proposals to provide technical and professional services for the implementation of VistA at 26 State operated psychiatric centers, approximately 310 outpatient clinics and OMH’s central office. Response to the RFP was due April 27. In addition it is expected that half-a-dozen to a dozen States will be releasing RFPs for VistA implementations at State medical facilities in the next few months.

VistA implementations in the private sector have also been an unqualified success. I am currently working on an article on private hospitals that have achieved meaningful use through VistA implementations. As part of the research I was able to get Medsphere, which has implementedOpenVistA in close to 30 hospitals (both private and State hospitals), to provide me with cost data for their implementations. In addition, I interviewed the CEOs and CIOs of several of these hospitals. The data shows that OpenVistA implementations came in at just 12% to 35% of the price of proprietary EHR proposals received by those hospitals—and in most cases those proprietary EHR proposals offered fewer features and capabilities. As noted in a recently published article by Richard Braman, the CTO of EHR Doctors, VistA has proven to be not only the low cost option, but also the “low risk” EHR option for hospitals. I’ll have more details in the forthcoming article.

In addition to VistA implementations by solution providers such as Medsphere and DSS, there is the extraordinary story of Oroville Hospital, a regional hospital in Northern California. As I detail in this blog post, the Oroville staff decided to implement VistA on their own in collaboration with the VistA community. Bringing VistA experts as needed, they have actually managed to self-deploy the system in the 153-bed acute care hospital, as well as in 17 out of the 18 clinics that the hospital owns. It is being used by almost 1,200 general users, more than 400 physicians, and more than 60 nurse practitioners and physician assistants. Oroville Hospital met meaningful use qualifications last year and has already received over $3 million in reimbursements. With several more reimbursements coming down the pipeline, the hospital will eventually receive more money in reimbursements than it spent implementing the system.

One of the major expenses of Oroville’s implementation has been over $500,000 they invested in developing enhancements and add-ons to VistA. Oroville CIO, Denise LeFevre told Open Health Newsthat this was one of the best investments the hospital had ever made since it was able to customize its EHR at a cost that was well under a tenth of what it would have had to spend in proprietary software. Oroville Hospital is contributing all of this code to the VistA community in order to help other hospitals implementing VistA.

In fact, in addition to all this code, Oroville also contributed $150,000 to the WorldVistA organization in January as a way of thanking the entire VistA community for all the volunteer help and support that members of the VistA community provided to the hospital. According to LeFevre, every time the Oroville staff went to the community’s HardHats mailing list for help and advice, it was the top experts in each module that came online to help them. Some of them were the actual original developers of the packages. And often several experts would work together to find a fix to whatever problem Oroville was having. This behavior is in fact an illustration of the spirit of collaboration that has been nurtured at the VA. LeFevre remarked, “no proprietary vendor would have ever provided us with that kind of support.”

International VistA

As previously mentioned, on the international scene, VistA has been implemented in more than 30 countries. Implementations range from single physician offices to entire countries. The Kingdom of Jordan, for example, is in the middle of rolling out VistA to all major medical centers in that country. This is a project championed by Jordan’s ruler, King Abdullah II, who visited the VA in 2003 and decided he wanted to see VistA running in his country. The initial pilot phase of the project has been a complete success. The VistA implementation team figured out how to scale VistA to serve as a national system and the project is now in the national roll out phase. A great description of the project can be found here. Part of the vision is to turn Jordan, which unlike other Middle Eastern countries has no oil, into an international center for medical excellence. Jordan has a highly educated population and a large number of physicians, so the idea is to attract patients from the Middle East, South East Asia and Africa.

King Abdullah II is not the only foreign dignitary that has come to tour and study the VA model. My partner in Open Health News and author of the COSI ‘Open’ Health blog, Peter Groen, was host to many foreign delegations during the more than 30 years he served in the VA. Peter held a series of senior management positions during his tenure at the VA and was the national project manager responsible for overseeing the implementation of the VistA Computerized Patient Record System (CPRS) throughout all VA healthcare facilities. In his final years at the VA, he was the National Director of the VA Health IT Sharing (HITS) program. In addition to sharing VistA with other Federal agencies, States, and non-government organizations (NGO), he hosted visits by representatives from numerous foreign countries, including the U.K., Mexico, Egypt, Taiwan, and Malaysia.

India is yet another nation where VistA is now making major inroads. Several dozen Indian hospitals have already successfully implemented VistA. Max Healthcare, for example, became the first hospital in India and only the sixth in all of Asia to achieve “Stage Level 6” on the HIMSS Analytics EHR adoption model based upon their use of VistA. Max Healthcare served as the VistA pilot implementation site for a large hospital network in India. 

Adding up all instances of VistA as well as its derivatives, including RPMS, there are somewhere between 2,800 and 3,300 hospitals, clinics, nursing homes, and physician offices that have implemented VistA to date.

Challenges faced by the VA

Despite the widespread adoption of VistA worldwide, there are several major challenges facing the VA’s open source strategy. Some of these challenges were raised during the Open Source Think Tank. Others were not mentioned.
In our view the greatest challenge facing the VA is integrating VistA with the Military Health System’s EHR system (known as AHLTA).

The Military Health System (MHS) currently runs 63 hospitals, including Walter Reed, as well as more than 400 clinics, serving an eligible population of 9.2 million. It operates worldwide and employs some 44,100 civilians and 89,400 military personnel. Integrating VistA with AHLTA poses a whole set of challenges ranging from technical to cultural. While the VA took an open source approach to the development of VistA, making all the core code public domain, the Military Health System took a completely different approach.

There are several fundamental flaws with the MHS approach. It would take a master thesis to detail them all, so for the sake of brevity, here are four major ones:

  1. Years ago, MHS senior staff rejected the VA open source approach and instead chose the standard Department of Defense (DoD) approach—contracting the work out to private vendors (known as ‘beltway bandits’).
  2. MHS has approached the development of AHLTA using the same procurement methodology that the DoD uses to procure aircraft carriers. These are completely different beasts.
  3. MHS has allowed its government contractors to retain ownership of the code they have been paid to develop (to the tune of over $10 billion in hard-earned taxpayer’s money). In contrast, the VA’s policy is that any code developed by the VA belongs to the American people.
  4. MHS has personnel that is as smart, dedicated, and capable as any in the VA. They have simply been unable to overcome the straight-jacket that the Pentagon has put them in through DoD procurement and management practices. 

As a result, MHS has suffered a string of major setbacks and now has a codebase that is a mis-match of nearly impenetrable proprietary code that is owned by dozens and dozens of different government contractors. 

One of the consequences of MHS self-inflicted “Rube Goldberg” code contraption, for example, is that even minor changes and improvements to AHLTA mean that MHS managers have to navigate a labyrinth of code that may have been coded by multiple vendors. Then they have to negotiate with all vendors who had anything to do with the code in order to make the changes. This requires complicated and expensive “change orders” with each and every vendor, all the way to far more complicated and expensive contract renegotiations. Managing AHLTA is a nightmare, and to top it off, it is universally disliked by the users.

The mission of the MHS and the VA, to care for wounded soldiers and veterans, makes it crucial that their EHR systems are interoperable. At present, moving medical records between the military and the veterans systems is still cumbersome, causing all kinds of challenges to the continuity of care for wounded soldiers. This despite the impressive record of the Federal Health Information Exchange (FHIE) that is used daily to move key patient data between the two organizations. Enhancing the capabilities of the VA and DoD systems to exchange data and making them more compatible over time, while keeping the VA system ‘open,’ will be one of the major challenges to be overcome in the coming years.

A recent scoop by veteran Washington journalist, Bob Brewin, columnist for the iconic “What’s Brewin’” blog in NextGov, underlines this discrepancy. Brewin was able to get his hands on an April 3 report sent to the Senate and House Armed Services committees by Dr. Jonathan Woodson, assistant secretary of Defense for Health Affairs. According to Brewin, in the report, the Pentagon tells Congress that they will be the primary provider of IT for integrated health records, “with VA playing second fiddle,” as Brewin puts it in his usual colorful language. As outlined in the report, commercial software is the primary choice for the Pentagon EHR. Open source software is mentioned exactly one time in the 55-page report.

The VA Model, A Solution to the Healthcare Crisis?

There is one more element to the VistA story that I would like to address. A large number of people have correctly identified the VA model, of which VistA is a critical element, as the solution to the healthcare crisis in the US. Just to mention a few facts. That VA provides the highest quality of care of any hospital in the US, and it does it for a fraction of the cost of private hospitals and Medicare. While the number of veterans it cares for has risen from 1.5 million to 8.5, million the costs of caring for each veteran have remained the same for the past decade (while at the same time health insurance premiums for Americans have more than doubled…).

This idea was articulated five years ago by Phillip Longman in a now famous article in Washington Monthly magazine titled “Best Care Everywhere: Here’s an idea: a civilian VA for the uninsured, and maybe the rest of us.” Longman’s thesis received a great deal of attention in Washington at the time as the solution to the healthcare crisis, but was eventually discarded as a result of a fierce lobbying campaign by the health insurance industry. With the release of the third edition of his book, Longman has added a substantial amount of evidence to show the merit of his proposal.

A more recent article by Dr. Marvin Malek, a physician who practices internal medicine at Central Vermont Hospital, addresses the need for a unified EHR platform to ensure the success of Vermont’s single payer law. Malek’s article, titled “Health information technology is a tower of Babel, by intent,” exposes the fundamental flaws of the current government’s health IT policies and correctly points out that implementing expensive and dysfunctional proprietary EHRs will obviate the savings from a single payer system. He has a series of actions that the State of Vermont should take to fix the problems created by proprietary EHRs. Malek’s recommendations apply to all States. The article was first published in vtdigger.org and reprinted with permission in Open Health News. Malek is one of tens of thousands of physicians who are calling for a single payer system in the US. This movement encompasses the majority of medical students today as described in this article. An organization,Physicians for a National Health Program, has become a central node for those seeking a real fix for the current broken system.

Longman is not the only nationally recognized journalist to call for the VA Model. Another is Shannon Brownlee, former senior writer and editor at U.S. News & World Report. After years of writing cover stories on diverse fixes to the healthcare system, fixes that eventually never worked, Brownlee decided to examine the underlying structural problems with the healthcare system and what it would take to really fix things. Thus she shifted her attention to groundbreaking work on avoidable health care, the patchy quality of medical ev
idence, and the implications for health care policy. Her conclusions and recommendations are featured in her book, “Overtreated: Why Too Much Medicine is Making Us Sicker and Poorer“. The book was a huge hit and was named the best economics book of 2007 by New York Times economics correspondent David Leonhardt. It was also a semi-finalist for the National Book Award. 

And her conclusion? In his article, “No. 1 Book, and It Offers Solutions” Leonhardt writes, “This was another very good year for economics books….But I’m going with Ms. Brownlee’s book because it’s the best description I have yet read of a huge economic problem that we know how to solve — but is so often misunderstood.” He adds,  “surprisingly, Ms. Brownlee lays out an agenda for reform….Hospitals that don’t use the fee-for-service model, like those run by the Veterans Health Administration, are already getting better results for less money. They closely track their performance — that is, the health of their patients — and motivate employees to improve it.”

Additional Background on VistA and Upcoming Meetings

For additional information on VistA and the VA Model, Open Health News is a great resource as we keep a close eye on all developments. A quick search brings up over 1,000 VistA-related news items and articles, and that search can be refined. We will soon be creating specific news channels that will make it easier to follow the stories.

In addition there will be three VistA-specific conferences in the next few months. The 25th VistA Community Meeting will take place at George Mason University in Fairfax, Virginia, on June 4-6.VistaEXPO and Symposium, which will feature exhibitions by VistA solutions providers and a substantial number of tutorial sessions, will be taking place in Seattle, Washington, September 11-14. In addition, OSEHRA will be hosting a conference at the end of the year.

http://openhealthnews.com/hotnews/va-invest-billions-open-source-transition

Half of individual plans fall below 60% actuarial value

More Than Half Of Individual Health Plans Offer Coverage That Falls Short Of What Can Be Sold Through Exchanges As Of 2014

By Jon R. Gabel, Ryan Lore, Roland D. McDevitt, Jeremy D. Pickreign, Heidi Whitmore, Michael Slover and Ethan Levy-Forsythe
Health Affairs, May 23, 2012

Abstract

The Affordable Care Act creates state-based health exchanges that will begin acting as a market place for health insurance plans and consumers in 2014. This paper compares the financial protection offered by today’s group and individual plans with the standards that will apply to insurance sold in state-based exchanges. Some states may apply these standards to all health insurance sold within the state. More than half of Americans who had individual insurance in 2010 were enrolled in plans that would not qualify as providing essential coverage under the rules of the exchanges in 2014. These people were enrolled in plans with an actuarial value below 60 percent, which means that the plans covered less than that proportion of the enrollees’ health expenses. Many of today’s individual health plans are below the “bronze” level, the lowest level of plan that can be sold through exchanges. In contrast, most group plans in 2010 had an actuarial benefit of 80–89 percent and would qualify as highly rated “gold” plans in the exchanges. To sell to ten million new buyers on the exchanges, insurers will need to redesign benefit packages. Combined with a ban on medical underwriting, the individual insurance market in a post–health reform world will sharply contrast with the market of past decades.

From the Discussion

Using simulated claim payments, we found that the average actuarial value of group plans in 2010 was 83 percent, and the average for individual plans was 60 percent. For an average family, annual out-of-pocket expenses were $1,765 with group coverage, compared to $4,127 with individual coverage. For people in poor health who incurred high medical expenses, the differences between the group and individual markets were even more dramatic.

Our findings have notable policy implications. First, the majority of Americans with individual insurance coverage today are enrolled in a plan whose actuarial value is too low to qualify for a state-based exchange. Insurance reforms that went into effect September 23, 2010, raised the financial protection offered by exchange plans. For example, lifetime maximum benefits were eliminated, effective preventive services must now be offered without cost sharing, and annual limits on insurance coverage were removed. But to qualify for exchanges, insurers will need to lower the average deductible level for individual tin plans, which today average nearly $3,900 for a single person.

Second, about two-thirds of today’s employees are enrolled in a gold or platinum plan. Families with coverage through the exchanges are likely to have less financial protection than employees with employer-based coverage enjoy today. Employers choosing to buy insurance coverage for their employees through the small-employer exchange, which could eventually include employers with more than a hundred workers, will probably obtain less extensive coverage if they opt to buy a plan in the silver tier than if they now offer a plan typical of those provided in the employer-based market today.

Third, very sick patients—those in the top 1 percent of medical spending—incur sizable out-of-pocket expenses regardless of coverage. For example, these top spenders face out-of-pocket expenses of nearly $3,800 in a group platinum plan. But there are substantial differences in out-of-pocket spending between plans with high actuarial value and plans with low value. A family in the top 1 percent of medical spenders with tin coverage in the individual market incurs annual out-of-pocket expenses of more than $27,000. (“Tin coverage” is a fifth tier created exclusively for this study. It is a level below the bronze tier – below 60 percent actuarial value – a level that will not be permitted in the state insurance exchanges.)

http://content.healthaffairs.org/content/early/2012/05/22/hlthaff.2011.1082.full

Comment: 

By Don McCanne, MD

Reports of this study likely will celebrate the fact that very low actuarial value plans which are commonplace in the individual market today – those below 60 percent value (plan pays less than 60 percent of covered health costs) – will have to reduce their deductibles and perhaps make other changes to qualify under the Affordable Care Act. But is this enough?

The study compared group plans with individual plans. Group plans have an average actuarial value of 83 percent, whereas the average actuarial value for individual plans is 60 percent, with 51 percent of them falling below that threshold. Only 14 percent were silver (70% AV) and 2 percent gold (80% AV), and there were no platinum (90% AV) plans in the individual market.

The lower half of all individual plans will have to either bring their value up to 60 percent or drop out of the exchange market. This means that average actuarial values of plans in the individual market – those available through the exchanges – will still be in the low 60s – far below group plans with their average actuarial value of 83.

Further, it is likely that smaller employers will rely on the exchanges to provide coverage for their employees – again with lower actuarial value plans than is typical of employer-sponsored group plans. The impact on patients will be significant.

Repeating a quote from above, “… very sick patients—those in the top 1 percent of medical spending—incur sizable out-of-pocket expenses regardless of coverage. For example, these top spenders face out-of-pocket expenses of nearly $3,800 in a group platinum plan (the very best coverage available). But there are substantial differences in out-of-pocket spending between plans with high actuarial value and plans with low value. A family in the top 1 percent of medical spenders with tin coverage in the individual market incurs annual out-of-pocket expenses of more than $27,000.”

Although “tin coverage” (plans under 60% AV) will be prohibited in the exchanges, the financial burden on patients who need significant amounts of health care will still be great, even with the subsidies and the elimination of maximum lifetime benefits. Instead of adding to the burden of illness, we should be attempting to preserve the financial security of patients, as we would be if we had a single payer national health program – an improved Medicare for all.

Half of individual plans fall below 60% actuarial value

More Than Half Of Individual Health Plans Offer Coverage That Falls Short Of What Can Be Sold Through Exchanges As Of 2014

By Jon R. Gabel, Ryan Lore, Roland D. McDevitt, Jeremy D. Pickreign, Heidi Whitmore, Michael Slover and Ethan Levy-Forsythe
Health Affairs, May 23, 2012
Abstract
The Affordable Care Act creates state-based health exchanges that will begin acting as a market place for health insurance plans and consumers in 2014. This paper compares the financial protection offered by today’s group and individual plans with the standards that will apply to insurance sold in state-based exchanges. Some states may apply these standards to all health insurance sold within the state. More than half of Americans who had individual insurance in 2010 were enrolled in plans that would not qualify as providing essential coverage under the rules of the exchanges in 2014. These people were enrolled in plans with an actuarial value below 60 percent, which means that the plans covered less than that proportion of the enrollees’ health expenses. Many of today’s individual health plans are below the “bronze” level, the lowest level of plan that can be sold through exchanges. In contrast, most group plans in 2010 had an actuarial benefit of 80–89 percent and would qualify as highly rated “gold” plans in the exchanges. To sell to ten million new buyers on the exchanges, insurers will need to redesign benefit packages. Combined with a ban on medical underwriting, the individual insurance market in a post–health reform world will sharply contrast with the market of past decades.
From the Discussion
Using simulated claim payments, we found that the average actuarial value of group plans in 2010 was 83 percent, and the average for individual plans was 60 percent. For an average family, annual out-of-pocket expenses were $1,765 with group coverage, compared to $4,127 with individual coverage. For people in poor health who incurred high medical expenses, the differences between the group and individual markets were even more dramatic.
Our findings have notable policy implications. First, the majority of Americans with individual insurance coverage today are enrolled in a plan whose actuarial value is too low to qualify for a state-based exchange. Insurance reforms that went into effect September 23, 2010, raised the financial protection offered by exchange plans. For example, lifetime maximum benefits were eliminated, effective preventive services must now be offered without cost sharing, and annual limits on insurance coverage were removed. But to qualify for exchanges, insurers will need to lower the average deductible level for individual tin plans, which today average nearly $3,900 for a single person.
Second, about two-thirds of today’s employees are enrolled in a gold or platinum plan. Families with coverage through the exchanges are likely to have less financial protection than employees with employer-based coverage enjoy today. Employers choosing to buy insurance coverage for their employees through the small-employer exchange, which could eventually include employers with more than a hundred workers, will probably obtain less extensive coverage if they opt to buy a plan in the silver tier than if they now offer a plan typical of those provided in the employer-based market today.
Third, very sick patients—those in the top 1 percent of medical spending—incur sizable out-of-pocket expenses regardless of coverage. For example, these top spenders face out-of-pocket expenses of nearly $3,800 in a group platinum plan. But there are substantial differences in out-of-pocket spending between plans with high actuarial value and plans with low value. A family in the top 1 percent of medical spenders with tin coverage in the individual market incurs annual out-of-pocket expenses of more than $27,000. (“Tin coverage” is a fifth tier created exclusively for this study. It is a level below the bronze tier – below 60 percent actuarial value – a level that will not be permitted in the state insurance exchanges.)
http://content.healthaffairs.org/content/early/2012/05/22/hlthaff.2011.1082.full

Reports of this study likely will celebrate the fact that very low actuarial value plans which are commonplace in the individual market today – those below 60 percent value (plan pays less than 60 percent of covered health costs) – will have to reduce their deductibles and perhaps make other changes to qualify under the Affordable Care Act. But is this enough?
The study compared group plans with individual plans. Group plans have an average actuarial value of 83 percent, whereas the average actuarial value for individual plans is 60 percent, with 51 percent of them falling below that threshold. Only 14 percent were silver (70% AV) and 2 percent gold (80% AV), and there were no platinum (90% AV) plans in the individual market.
The lower half of all individual plans will have to either bring their value up to 60 percent or drop out of the exchange market. This means that average actuarial values of plans in the individual market – those available through the exchanges – will still be in the low 60s – far below group plans with their average actuarial value of 83.
Further, it is likely that smaller employers will rely on the exchanges to provide coverage for their employees – again with lower actuarial value plans than is typical of employer-sponsored group plans. The impact on patients will be significant.
Repeating a quote from above, “… very sick patients—those in the top 1 percent of medical spending—incur sizable out-of-pocket expenses regardless of coverage. For example, these top spenders face out-of-pocket expenses of nearly $3,800 in a group platinum plan (the very best coverage available). But there are substantial differences in out-of-pocket spending between plans with high actuarial value and plans with low value. A family in the top 1 percent of medical spenders with tin coverage in the individual market incurs annual out-of-pocket expenses of more than $27,000.”
Although “tin coverage” (plans under 60% AV) will be prohibited in the exchanges, the financial burden on patients who need significant amounts of health care will still be great, even with the subsidies and the elimination of maximum lifetime benefits. Instead of adding to the burden of illness, we should be attempting to preserve the financial security of patients, as we would be if we had a single payer national health program – an improved Medicare for all.

Amartya Sen on government austerity

The Crisis of European Democracy

By Amartya Sen
The New York Times, May 22,2012

The worthy but narrow intentions of the European Union’s policy makers have been inadequate for a sound European economy and have produced instead a world of misery, chaos and confusion.

There are two reasons for this.

First, intentions can be respectable without being clearheaded, and the foundations of the current austerity policy, combined with the rigidities of Europe’s monetary union (in the absence of fiscal union), have hardly been a model of cogency and sagacity. Second, an intention that is fine on its own can conflict with a more urgent priority — in this case, the preservation of a democratic Europe that is concerned about societal well-being. These are values for which Europe has fought, over many decades.

The cause of reform, no matter how urgent, is not well served by the unilateral imposition of sudden and savage cuts in public services. Such indiscriminate cutting slashes demand — a counterproductive strategy, given huge unemployment and idle productive enterprises that have been decimated by the lack of market demand.

There is, in fact, plenty of historical evidence that the most effective way to cut deficits is to combine deficit reduction with rapid economic growth, which generates more revenue.

There are surely lessons here from John Maynard Keynes, who understood that the state and the market are interdependent. But Keynes had little to say about social justice, including the political commitments with which Europe emerged after World War II. These led to the birth of the modern welfare state and national health services — not to support a market economy but to protect human well-being.

Though these social issues did not engage Keynes deeply, there is an old tradition in economics of combining efficient markets with the provision of public services that the market may not be able to deliver. As Adam Smith (often seen simplistically as the first guru of free-market economics) wrote in “The Wealth of Nations,” there are “two distinct objects” of an economy: “first, to provide a plentiful revenue or subsistence for the people, or, more properly, to enable them to provide such a revenue or subsistence for themselves; and secondly, to supply the state or commonwealth with a revenue sufficient for the public services.”

Participatory public discussion — the “government by discussion” expounded by democratic theorists like John Stuart Mill and Walter Bagehot — could have identified appropriate reforms over a reasonable span of time, without threatening the foundations of Europe’s system of social justice.

Europe cannot revive itself without addressing two areas of political legitimacy. First, Europe cannot hand itself over to the unilateral views — or good intentions — of experts without public reasoning and informed consent of its citizens.

Second, both democracy and the chance of creating good policy are undermined when ineffective and blatantly unjust policies are dictated by leaders. The obvious failure of the austerity mandates imposed so far has undermined not only public participation — a value in itself — but also the possibility of arriving at a sensible, and sensibly timed, solution.

This is a surely a far cry from the “united democratic Europe” that the pioneers of European unity sought.

(Amartya Sen is a Nobel laureate and a professor of economics and philosophy at Harvard.)

http://www.nytimes.com/2012/05/23/opinion/the-crisis-of-european-democracy.html

Comment: 

By Don McCanne, MD

Although Amartya Sen warns of the threat of unilateral austerity programs to the united democratic Europe, his words can also apply to the current political efforts in the United States to reduce the role of government through austerity measures. The current attack on Medicare exemplifies the fact that the austerity agenda does not spare our government health programs.

Perhaps the most important warning we should extract is implied by Professor Sen’s concern about the undermining of public participation. We should take heed of the fact that a united democratic nation requires not only public involvement but also public awareness of the proposed policies and their ramifications. As he writes, political legitimacy of nations requires “public reasoning and informed consent of its citizens.”

The public has to understand that the rhetoric of unilaterally “reducing taxes” equates with imposing government austerity. They then have to understand what government austerity truly means. It does not mean, “cut my taxes, but leave my Medicare alone.”

Amartya Sen on government austerity

The Crisis of European Democracy

By Amartya Sen
The New York Times, May 22,2012
The worthy but narrow intentions of the European Union’s policy makers have been inadequate for a sound European economy and have produced instead a world of misery, chaos and confusion.
There are two reasons for this.
First, intentions can be respectable without being clearheaded, and the foundations of the current austerity policy, combined with the rigidities of Europe’s monetary union (in the absence of fiscal union), have hardly been a model of cogency and sagacity. Second, an intention that is fine on its own can conflict with a more urgent priority — in this case, the preservation of a democratic Europe that is concerned about societal well-being. These are values for which Europe has fought, over many decades.
The cause of reform, no matter how urgent, is not well served by the unilateral imposition of sudden and savage cuts in public services. Such indiscriminate cutting slashes demand — a counterproductive strategy, given huge unemployment and idle productive enterprises that have been decimated by the lack of market demand.
There is, in fact, plenty of historical evidence that the most effective way to cut deficits is to combine deficit reduction with rapid economic growth, which generates more revenue.
There are surely lessons here from John Maynard Keynes, who understood that the state and the market are interdependent. But Keynes had little to say about social justice, including the political commitments with which Europe emerged after World War II. These led to the birth of the modern welfare state and national health services — not to support a market economy but to protect human well-being.
Though these social issues did not engage Keynes deeply, there is an old tradition in economics of combining efficient markets with the provision of public services that the market may not be able to deliver. As Adam Smith (often seen simplistically as the first guru of free-market economics) wrote in “The Wealth of Nations,” there are “two distinct objects” of an economy: “first, to provide a plentiful revenue or subsistence for the people, or, more properly, to enable them to provide such a revenue or subsistence for themselves; and secondly, to supply the state or commonwealth with a revenue sufficient for the public services.”
Participatory public discussion — the “government by discussion” expounded by democratic theorists like John Stuart Mill and Walter Bagehot — could have identified appropriate reforms over a reasonable span of time, without threatening the foundations of Europe’s system of social justice.
Europe cannot revive itself without addressing two areas of political legitimacy. First, Europe cannot hand itself over to the unilateral views — or good intentions — of experts without public reasoning and informed consent of its citizens.
Second, both democracy and the chance of creating good policy are undermined when ineffective and blatantly unjust policies are dictated by leaders. The obvious failure of the austerity mandates imposed so far has undermined not only public participation — a value in itself — but also the possibility of arriving at a sensible, and sensibly timed, solution.
This is a surely a far cry from the “united democratic Europe” that the pioneers of European unity sought.
(Amartya Sen is a Nobel laureate and a professor of economics and philosophy at Harvard.)
http://www.nytimes.com/2012/05/23/opinion/the-crisis-of-european-democracy.html

Although Amartya Sen warns of the threat of unilateral austerity programs to the united democratic Europe, his words can also apply to the current political efforts in the United States to reduce the role of government through austerity measures. The current attack on Medicare exemplifies the fact that the austerity agenda does not spare our government health programs.
Perhaps the most important warning we should extract is implied by Professor Sen’s concern about the undermining of public participation. We should take heed of the fact that a united democratic nation requires not only public involvement but also public awareness of the proposed policies and their ramifications. As he writes, political legitimacy of nations requires “public reasoning and informed consent of its citizens.”
The public has to understand that the rhetoric of unilaterally “reducing taxes” equates with imposing government austerity. They then have to understand what government austerity truly means. It does not mean, “cut my taxes, but leave my Medicare alone.”

When your coverage gets cut, would you buy into Medicare?

By Jack Bernard
Charleston (W.Va.) Gazette, May 12, 2012

CHARLESTON, W.Va. — If the highly politicized Supreme Court overturns the individual mandate — and possibly all of Obamacare (the Affordable Care Act), where do we go from here?

Do we throw up our hands and say the sky is falling, as the Democrats are currently doing? Or do we stick our heads in the sand and go to a Dickensian free enterprise system like some on the right advocate, the uninsured sick be damned?

My party, the GOP, clearly does not want to talk about the elephant in the room — health insurance coverage trends. According to a recent Gallup poll, the number of uninsured nationwide has gone from 15 percent in 2008 to 17 percent in 2011. So, the private model insurance system is not only failing, it is failing at an increasing rate when it comes to covering the uninsured.

In West Virginia, the situation is more stable, with no rise in the last few years. However, the uninsured are still 18 percent of the population, above the national average.

For those who are still insured, the situation is problematic. In West Virginia, premiums for those enrolled in full family coverage have been going up substantially, from $12,554 in 2009 to $14,542 in 2010, a 16 percent increase in just one year, according to the Agency for Healthcare Research and Quality.  Yes, $10,150 of this cost is picked up by the employer, but that just results in lower wages over the long run. Or, even worse, relocation of West Virginia factories overseas. How long can this go on?

As a small employer (I am a County Commissioner in a rural county near Atlanta), I know that we have a tough choice each year. We can:

* Increase employee deductibles and co-payments because of higher insurance charges to us.

* Cut programs like road maintenance, EMS, the sheriff and the courts.

* Raise property taxes yet again.

I mentor small businesses that face the same situation, only worse because they cannot raise revenues through taxation. Larger companies are absorbing more of the premiums, but they are moving their operations out of the United States in part because of steadily rising health care costs.

The answer to our problem is Medicare For All. A single payer system will restrict the rise in costs and cover every citizen. Single payer is what the majority of developed nations have enacted and their per capita costs are much less than here. A respected group, Physicians for a National Health Program, has examined this scenario in great detail. There is more at their site pnhp.org.

At a minimum, we should seriously reconsider the Reid plan to expand Medicare incrementally. In 2009, Sen. Harry Reid proposed a voluntary buy-in for folks 55-64 who did not have private insurance. Unsurprisingly, there were immediate outcries from the insurance, physician and hospital lobbies. Some of their objections were reasonable, but most were just self-serving.

The affect of adverse selection — having only the sickest people buy into the system — was the most valid objection by insurance companies. Another was the unknown impact that the expansion would have on the financial side for both the government and providers.

The way to address these two issues is through expanding Medicare year by year. In other words, just take what Reid said and move to an incremental implementation. In 2013, folks 64 could buy in. In 2014, people 63 could buy in, and so forth. It would be slow, but eventually everyone over 55 would be covered. Then, it could be expanded to other groups. And, if the impact on providers is minimal… as I believe it would be… the phase-in could be revved up.

If we had a bi-partisan Congress dedicated to helping the country, rather than just the insurance company and medical lobbyists funding their campaigns, passing this legislation would be simple. As difficult as it is, elected officials of good faith on both sides of the aisles should come together and propose Medicare expansion as a bi-partisan compromise for the good of the nation.

If not, we can just wait another 10 or 15 years until many more West Virginians and Americans have lost their unaffordable private insurance, the number of uninsured is 33 percent or more here and elsewhere, our industries are uncompetitive internationally, and we are forced to go to a single payer model.

As Churchill said, “Americans can always be counted on to do the right thing, after they have exhausted all other possibilities.”

Bernard is a retired senior health care executive and a county commissioner in Jasper County, Ga. He has worked with several W.Va. hospitals, including CAMC, and oversaw planning for Humana Hospital-Greenbrier Valley and the region. 

http://wvgazette.com/Opinion/OpEdCommentaries/201205110164

GAO on the Small Employer Health Insurance Tax Credit

Small Employer Health Tax Credit: Factors Contributing to Low Use and Complexity

GAO (Government Accountability Office)
May 14, 2012

Fewer small employers claimed the Small Employer Health Insurance Tax Credit in tax year 2010 than were estimated to be eligible. While 170,300 small employers claimed it, estimates of the eligible pool by government agencies and small business advocacy groups ranged from 1.4 million to 4 million. The cost of credits claimed was $468 million. Most claims were limited to partial rather than full percentage credits (35 percent for small businesses) because of the average wage or full-time equivalent (FTE) requirements. 28,100 employers claimed the full credit percentage. In addition, 30 percent of claims had the base premium limited by the state premium average.

One factor limiting the credit’s use is that most very small employers, 83 percent by one estimate, do not offer health insurance. According to employer representatives, tax preparers, and insurance brokers that GAO met with, the credit was not large enough to incentivize employers to begin offering insurance. Complex rules on FTEs and average wages also limited use. In addition, tax preparer groups GAO met with generally said the time needed to calculate the credit deterred claims. Options to address these factors, such as expanded eligibility requirements, have trade-offs, including less precise targeting of employers and higher costs to the Federal government.

http://www.gao.gov/assets/600/590832.pdf

Comment: 

By Don McCanne, MD

One of the benefits of the Affordable Care Act is the tax credits offered to small businesses to help them obtain health insurance coverage for their employees. This evaluation by the GAO shows that, in 2010, 83 percent of small businesses eligible for the full credit did not even offer health insurance.

According to the report, “small employers do not likely view the credit as a big enough incentive to begin offering health insurance and to make a credit claim, according to employer representatives, tax preparers, and insurance brokers we met with.”

Though the complexity of the rules and the modest amount of the credits are cited as causes for the low participation rates, the fundamental flaw is that this program was designed to comply with our fragmented, dysfunctional system of financing health care – a model that will always fall short of reform goals.

Instead of trying to patch our fragmented program of private plans and pubic programs, we need to replace it with a single payer national health program – an improved Medicare for all.

Call it ‘ObamaCares’

By Gustavo S. Montana, M.D.
The Herald-Sun (Durham, N.C.), Letters, May 2, 2012

The Accountable Care Act (ACA) has drawn more attention now that the Supreme Court is about to decide its fate.

The critics of ACA often refer to it as ObamaCare. Objections to the act are directed to the entire legislation or to specific issues that the legislation addresses. The critics of ACA do not offer solutions to any of the problems that this legislation addresses.

Mr. Romney, among the critics, advocates the abolition of ACA but he neglects to acknowledge that the Massachusetts Health Plan, which he enacted as governor, shares similarities with ACA, thus Mr. Romney should also advocate the abolition of the Massachusetts plan.

While we wait for the Supreme Court decision, we should honestly evaluate alternatives to ACA like a national or state-by-state single-payer system(s) with the option to obtain medical services of questionable or unproven benefit through private insurance. The reduction in administrative cost of a single-payer system lowers the cost of health care and frees financial and human resources that can be invested in education, research and other sectors of the economy.

When President Obama pursued health care reform, he intended to make the system fair and accessible to most of the people in this country. His effort fell short not by his lack of conviction and understanding of the issues but by a political system aligned with other interests. I think that we should refer to ACA as ObamaCares because I believe that Mr. Obama does care.

Dr. Gustavo S. Montana lives in Chapel Hill, N.C.

http://www.heraldsun.com/view/full_story/18423855/article-Letters–May-2?instance=search_results

The ills of money-driven medicine

By Philip Caper, M.D.
Bangor Daily News (Maine), May 17, 2012

A couple of weeks ago, nine medical specialty societies released a list of 45 medical tests and procedures they believed are significantly overused. On the heels of this announcement was a conference on “Avoiding Avoidable Care” attended by about 150 experts, mostly physicians. I attended.

We spent two days discussing the reasons for and ethics of unnecessary medical care in the U.S. Instead of blaming others (such as patients or malpractice lawyers), the doctors at this conference mostly agreed that “If you’re looking for an explanation for medical care overuse — too many tests, procedures and prescriptions — follow the money.”

The amount of overuse was estimated to be around 30 percent of all medical care. We spend $2.7 trillion annually on medical care in the U.S. Thirty percent of a big number is still a big number, about $800 billion in this case. In our industrialized health care system, moving “product” is important, whether or not it is really necessary.

The World Health Organization reported earlier this month that the U.S. ranks poorly in our rate of premature births. Our rate of prematurity has risen around 30 percent since 1981. We are now on a par with Turkey, Kenya, Thailand and Honduras at about 12 percent. Canada, Australia and Europe all fare significantly better with rates around 7 percent.

The high U.S. rate is attributed to a variety of factors. Lack of prenatal care tied to poor health insurance coverage is prominent among them. Many of these premature births could be prevented, and have been in many other countries, through better primary care and inexpensive public health measures. Many in Congress are now trying to eliminate such programs — to save money.

The BDN recently reported that 750 people showed up last month in Machias for free dental care offered by volunteers. The lack of dental care in rural Washington County was attributed largely to economic barriers made worse by poor economic times, such as lack of dental insurance, and to diets filled with cheap “soda, sweets and junk food.”

But don’t worry, your health care dollars are at work in other ways. Documents released earlier this month by the Minnesota attorney general detailed the increasingly desperate tactics employed by hospitals as unpaid debts mount. They are attempting to collect money owed by patients seeking emergency care, sometimes by threatening denial of services. Accretive Health, the company employed by the hospitals to collect the bills, reported a $29.2 million profit last year. Accretive Health saw its stock decline 19 percent after the papers were released.

The real tragedy in these stories is that the dysfunction in each is mostly avoidable. They are all the result of applying the principles of business and the techniques of industrialization to health care, where they don’t belong.

During the past several decades, clinical decision-making, from lab tests to pharmaceutical prescribing to procedures (including some highly invasive ones), have become subject to “market forces.” Most Maine doctors are now employed by large corporations that hold them to “productivity (profit) targets,” achieved mainly by ordering tests and procedures, in order to meet “business objectives.”

The result has been an explosion of health care services and costs for those who can pay. We as a nation now spend twice as much as other countries that provide health care for all their people, and with better results, at about half the cost.

Ballooning health care costs are crowding out public health and prevention measures, education, infrastructure and public safety. They have contributed in a major way to job-lock, stagnation of wages and declining health insurance protection (think MaineCare) for all but the most well-off.

While the federal health reform law was a remarkable political accomplishment and makes some important but limited progress, it will fall far short of getting the job done.

Real reform has to occur in three phases. First, replace our employment-based, for-profit health insurance system with a single nonprofit, publicly financed system — everyone in, nobody out. Second, remove economic incentives from clinical decision-making. Third, establish firm and effective budgetary limits on all aspects of health care that apply fairly to everybody. Finally, return the culture of health care to one of maintaining health and healing illness, and away from money-driven medicine.

Given the gridlock in Congress, I don’t expect to see such changes coming from Washington. But we in Maine can do it ourselves. All it takes is the will.

Physician Philip Caper of Brooklin is a founding board member of Maine AllCare, a nonpartisan, nonprofit group committed to making health care in Maine universal, accessible and affordable for all. He can be reached at pcpcaper21@gmail.com.

http://bangordailynews.com/2012/05/17/health/the-ills-of-money-driven-medicine/

GAO on the Small Employer Health Insurance Tax Credit

Small Employer Health Tax Credit: Factors Contributing to Low Use and Complexity

GAO (Government Accountability Office)
May 14, 2012
Fewer small employers claimed the Small Employer Health Insurance Tax Credit in tax year 2010 than were estimated to be eligible. While 170,300 small employers claimed it, estimates of the eligible pool by government agencies and small business advocacy groups ranged from 1.4 million to 4 million. The cost of credits claimed was $468 million. Most claims were limited to partial rather than full percentage credits (35 percent for small businesses) because of the average wage or full-time equivalent (FTE) requirements. 28,100 employers claimed the full credit percentage. In addition, 30 percent of claims had the base premium limited by the state premium average.
One factor limiting the credit’s use is that most very small employers, 83 percent by one estimate, do not offer health insurance. According to employer representatives, tax preparers, and insurance brokers that GAO met with, the credit was not large enough to incentivize employers to begin offering insurance. Complex rules on FTEs and average wages also limited use. In addition, tax preparer groups GAO met with generally said the time needed to calculate the credit deterred claims. Options to address these factors, such as expanded eligibility requirements, have trade-offs, including less precise targeting of employers and higher costs to the Federal government.
http://www.gao.gov/assets/600/590832.pdf

One of the benefits of the Affordable Care Act is the tax credits offered to small businesses to help them obtain health insurance coverage for their employees. This evaluation by the GAO shows that, in 2010, 83 percent of small businesses eligible for the full credit did not even offer health insurance.
According to the report, “small employers do not likely view the credit as a big enough incentive to begin offering health insurance and to make a credit claim, according to employer representatives, tax preparers, and insurance brokers we met with.”
Though the complexity of the rules and the modest amount of the credits are cited as causes for the low participation rates, the fundamental flaw is that this program was designed to comply with our fragmented, dysfunctional system of financing health care – a model that will always fall short of reform goals.
Instead of trying to patch our fragmented program of private plans and pubic programs, we need to replace it with a single payer national health program – an improved Medicare for all.

Private insurers blame health care prices

Health Care Cost and Utilization Report: 2010

Health Care Cost Institute
May 2012

The Health Care Cost Institute (HCCI) was created in September 2011 to provide comprehensive data on health care costs and promote independent, nonpartisan research and analysis on the causes of the rise in U.S. health spending.

HCCI’s research activities are based on de-identified data voluntarily provided by Aetna, Humana, Kaiser Permanente, and UnitedHealthcare, four of the nation’s largest insurers.

The 2010 HCCI Health Care Cost and Utilization Report is the first report of its kind to track changes in expenditures and utilization of health care services by those younger than 65 covered by employer sponsored, private health insurance (ESI).

$4,255 –
Average annual per capita health care spending for beneficiaries younger than 65 and covered by employer-sponsored group insurance in 2010.

1.6% & 3.3% –
The consumer price index (CPI-U), a measure of price inflation, and the growth rate of average per capita spending on group ESI beneficiaries younger than 65 (2009-2010). Per capita spending outpaced overall price inflation in 2010.

2.6% & 7.1% –
Growth rate of estimated per capita health care spending by insurers and beneficiaries, respectively, between 2009 and 2010.

Summary of the Executive Summary

We find continued growth in per capita and estimated aggregate health care spending in this population, although that growth is less than 4 percent. This is consistent with the Centers for Medicare & Medicaid Services’ findings regarding national health expenditures. Patients’ out-of-pocket share of prices paid went up, although the cost-sharing rate on a per capita basis (including beneficiaries who did not use services) did not change much. Prices increased across all categories of service, with outpatient services experiencing the fastest growth. Unlike other recent reports on health care spending, we find that the increased spending is mostly due to unit price increases rather than changes in the quantity or intensity of services.

http://www.healthcostinstitute.org/files/HCCI_HCCUR2010.pdf

And…

S&P Healthcare Economic Indices

March 2012 Update

7.84% – S&P Healthcare Economic Commercial Index
2.41% – S&P Healthcare Economic Medicare Index

http://www.standardandpoors.com/indices/sp-healthcare-economic-indices/en/us/?indexId=sp-healthcare-economic-indices

Comment:

By Don McCanne, MD

Until now, much of our information on health care costs has been obtained from government sources – especially Medicare and Census data. The Health Care Cost Institute is an effort on the part of the private insurance industry to share their data in an effort to improve research and analysis on the causes of the rise in U.S. health care spending.

Cooperating in this effort are Aetna, Humana, Kaiser Permanente, and UnitedHealthcare. Conspicuously absent are Cigna, and especially WellPoint.

Many reasons are given for our very high health care costs, but this study adds to the evidence that price increases are the most important factor (except, of course, for the administrative waste that is usually ignored in studies like this). The excess increase in prices is a particularly relevant observation since this study was limited to individuals under 65 with employer-sponsored, private health insurance.

This report establishes beyond any doubt that the nation’s largest private insurers have been ineffective in controlling health care prices (not to mention generating more administrative waste). In spite of the contracts that the private insurers have with health care providers, health care price increases continue to greatly exceed the rate of inflation. Also, the most recent S&P Healthcare Indices confirm, once again, that our government Medicare program has been far more effective in controlling per capita health care costs than have the private commercial insurers.

All other nations control health care prices. Medicare controls health care prices. Only our private insurers have been incompetent in slowing price escalation. This is yet more evidence that private insurer intermediaries functioning relatively autonomously in the health care marketplace are ineffective in bringing us better pricing of health care products and services. This is a job for government, not the marketplace.

We are often accused of being unfairly critical of the private insurers since it is not their fault that health care prices are so high. Do we really care whether or not it is their fault? Prices are high, and they haven’t helped. They are a profoundly expensive administrative industry. We should continue to waste our vast sums on their ineffective model of price containment?

Look at the growth rates of per capita health spending that they report in this study of their own industry. The spending by the insurers increased at a rate of 2.6%, a feat that they were able to accomplish partly by increasing beneficiaries costs by 7.1%! Is that the kind of assistance that we need from this industry?

It’s time to throw them out of the Temple (a biblical proxy for all religious and secular moralists).