PNHP

The collapse of primary care, and the SGR

The collapse of primary care, and the SGR

The Impending Collapse of Primary Care Medicine and Its Implications for the State of the Nation’s Health Care
American College of Physicians
January 30, 2006

Conclusion

Unless immediate and comprehensive reforms are implemented by Congress and CMS, primary care-the backbone of the U.S. health care system-will collapse.

The consequences will be higher costs and lower quality as patients find themselves in a confusing, fragmented and over-specialized system in which no one physician accepts responsibility for their care, and no one physician is accountable to them for the quality of care provided. The state of the nation’s health care in 2006 already is deficient, as evidenced by increasing costs, more uninsured persons, persistent gaps in quality, and the decline in the numbers of physicians going into primary care. But the state of the nation’s health care in the near future will be far worse if the collapse of primary care is allowed to happen.

The recommendations being advanced today by the American College of Physicians offer a comprehensive strategy to redesign how primary care is financed and delivered to allow physicians to provide care that is centered on the needs of patients. ACP believes that our recommendations, coupled with reforms in medical education and relief from student debt, can reverse the decline in the number of physicians going into primary care. The federal government must accept its responsibility to redesign Medicare payment policies to recognize the value of physician-guided care coordination through an advanced medical home, to increase reimbursement for undervalued evaluation and management services, to expand coverage and provide reimbursement for health information technology, and to link payments to quality in a way that is non-punitive and provides substantial increases–commensurate with effort-to those physicians who participate in quality improvement, measurement and reporting focused on the top 20 conditions described in the IOM’s Crossing the Quality Chasm report.

Such reform will help strengthen the state of the nation’s health care, now and in the future, by acknowledging and supporting the value and role of primary care physicians in delivering better care at lower cost.

http://www.acponline.org/hpp/statehc06_1.pdf

ACP Policy Monograph on The Advanced Medical Home:
http://www.acponline.org/hpp/statehc06_5.pdf

Comment: By Don McCanne, M.D.

One of the greatest crises in health care today is the accelerating deterioration of our primary care infrastructure. Shifting to a fragmented primary system of multiple specialized services, the current trend in the United States, has been well documented to increase costs and result in lower quality outcomes.

The concept of the advanced medical home will not be addressed here other than to say that it is important that we improve the way that health care services are delivered, especially with current demographic shifts and evolving needs. The policy monograph accessible through the link above can provide more information on this important concept.

Although there are many reasons for the decline in primary care, two of the most important are comparatively low pay, and very long, labor-intensive hours. Concern about the latter can be reduced by improving the practice environment through application of innovative thinking of the type that led to the advanced medical home model. A gratifying practice environment would certainly make primary care a more attractive practice choice.

What about compensation? Most would agree that, by U.S. standards, primary physicians are under-compensated. Most would also agree that the amount of our GDP delegated to physicians is about right. The obvious conclusion is that some of the compensation directed to specialists should be shifted to generalists. Specialist compensation would still be adequate to provide for a very comfortable lifestyle, and would meet needs such as college expenses for the children and very comfortable pensions. If a physician really needs a fleet of luxury automobiles and a condo in every climate, then medicine might not be a good career choice.

Under a single payer system, physician compensation would be negotiated. The playing field would be leveled wherein primary care representatives would advocate for a more appropriate generalist/specialist compensation ratio. It would be beneficial to remove money as a major factor in the decision of a physician-in-training on whether to enter primary care or a specialty.

The process of negotiating compensation with the single payer administrators should be contrasted with our current system of paying physicians. The ACP report, as an example, is appropriately critical of the SGR (sustainable growth rate) method used by Medicare. With rigid fee schedules, physicians increase the frequency and intensity of services. The SGR is designed to keep the growth of spending in line with inflation and demographic changes.

As some physicians siphon off more funds by increases in frequency and intensity, downward adjustments must be made in the per unit payments. This penalizes physicians who make greater efforts to ensure that services are appropriate and efficient.

Although total Medicare spending for physicians is adjusted upwards, the per unit payments were reduced 4.4% this year. In the budget reconciliation process taking place now, these cuts will be restored. But look at what is happening.

S. 1932 – Deficit Reduction Act of 2005
Cost Estimate
Congressional Budget Office
January 27, 2006

“The act would increase payment rates for physicians’ services to the 2005 level (those payment rates were reduced by 4.4 percent on January 1, 2006).

That provision would increase outlays during the 2006-2009 period, and would reduce Medicare’s payments to physicians below current-law levels in subsequent years.”

http://www.cbo.gov/ftpdocs/70xx/doc7028/s1932conf.pdf

Further comment: You probably read that too fast, so let’s stop and see what it says. It was anticipated that the same dynamics would continue and that additional cuts beyond this year’s 4.4% would eventually add up to about a 25% reduction. Those reductions are being eliminated through 2009, but in 2010, the full level of reductions will be reinstituted with one dramatic drop in rates. But wait, there’s more! The funds that will be used to reestablish 2005 rates through 2009 are only a loan. As of 2010, the repayment of the loan will be added to the scheduled reductions resulting in a drop in Medicare compensation rates that virtually no physician will tolerate. By coincidence, that is the same year that Congress has called for the beginning of the process to entice physicians to exit the traditional Medicare program and provide their services through the private Medicare Advantage plans. What a nefarious plot! (In fairness, the reconciliation act does call for a report from the Medicare Payment Advisory Commission for suggestions on replacement of the SGR system, though primarily through methods of controlling volume growth – another problematic approach.)

The $2 trillion that we are spending is enough to provide high quality care for everyone, but it will never happen under our current flawed system. We won’t get it right until we establish a single national health insurance program. Once we have that in place then we will have the ability to allocate sufficient resources to our primary care infrastructure to ensure higher quality, more cost-effective care for everyone.

"We Will Educate Our Colleagues, the Policy Community, the Media, and Our Patients": Physicians for a National Health Program Meet in Philadelphia

by Andy Coates
Published in MRZine

Physicians for a National Health Program held its annual meeting on December 10, 2005. Originally planned for New Orleans, it was relocated to Philadelphia after Hurricane Katrina. Founded in 1987, the organization has over 14,000 members nationally. PNHP advocates and educates for a single national health insurance plan: in the words of PNHP National Coordinator Quentin Young, MD, “everybody in, nobody out.” With about 250 in attendance, the meeting consisted of a series of panel discussions.

The PNHP “Proposal of the Physicians’ Working Group for Single-Payer National Health Insurance” has been published in the New England Journal of Medicine (in 1989) and the Journal of the American Medical Association (in 2003). Over 12,000 physicians endorsed the plan in 2003-2004. The proposed plan would cover all necessary medical care, including mental health and dental care, long-term care, hospitalization, and all prescription medications.

The Physicians’ Proposal articulates four principles:

1. Access to comprehensive health care is a human right. It is the responsibility of society, through its governement, to assure this right. Private insurance firms’ past record disqualifies them from a central role in managing health care.

2. The right to choose and change one’s physician is fundamental to patient autonomy. Patients should be free to seek care from any licensed health care professional.

3. Pursuit of corporate profit and personal fortune have no place in caregiving and they create enormous waste. The U.S. already spends enough to provide comprehensive health care to all Americans with no increase in total costs. However, the vast health care resources now squandered on bureaucracy (mostly due to efforts to divert costs to other payers or onto patients themselves), profits, marketing, and useless or even harmful medical interventions must be shifted to needed care.

4. In a democracy, the public should set overall heatlh policies. Personal medical decisions must be made by patients with their caregivers, not by corporate or government bureaucrats.

PNHP President John Geyman, MD, welcomed participants to the meeting with brief remarks. Former editor of The Journal of Family Practice and author of many works including the Textbook of Rural Medicine, Dr. Geyman has written several books on the crisis in American health care.

Dr. Geyman’s soon-to-be-released book Shredding the Social Contract: The Privatization of Medicare (Common Courage Press, 2006) was available at the meeting. He writes in its first chapter that “the great debate of the 21st century will be about how the new rules for a global market can be rewritten in the public interest. The current model of ‘corporate managed trade’ serves corporate self-interest at the expense of entire populations.”

Steffie Woolhandler, MD, PNHP co-founder and associate professor of medicine at Harvard Medical School, started the day at 78 rpm with a brisk update of the PHNP slideshow, an activists’ speaking tool that digests evidence from the medical literature of the injustice, inequality, and inefficiency of health care in the United States.

Dr. Woolhandler explained, for example, that it is a myth that those who have trouble paying for care are uninsured but young and healthy. In a study Dr. Woolhandler published this year with PNHP co-founder David Himmelstein, MD, Elizabeth Warren, and Deborah Thorne, “Illness and Injury as Contributors to Bankruptcy,” over half of those declaring bankruptcy were driven into debt by medical costs. Of these, three quarters of debtors had insurance at the onset of illness and three fifths had private insurance at the onset of illness!

As part of a panel discussion on market-driven health care, Adewale Troutman, MD, spoke. An author, with former U.S. surgeon general David Satcher, MD, of “What If We Were Equal? A Comparison of the Black-White Mortality Gap in 1960 and 2000,” Dr. Troutman illustrated, with the case of a 56-year-old African American woman, how the failures of the American health care system lead to avoidable death and suffering. He advocated using the terms “injustice” and “inequality” instead of “disparities.” He suggested Episode III of Race: The Power of an Illusion, which looks at the question of housing, as a useful video analogy to portray the systemic racism in U.S. health care.

A panel devoted to Canada proved so popular that an extra session had to be organized for continued discussion. Steven Barrett, an attorney who was counsel for the Canadian Labor Congress before the Supreme Court of Canada in the Chaoulli v. Quebec case, gave an overview of medical malpractice in Canada, which is scarcely comparable to the United States. (Among many differences, with a single-payer system like the Canada’s Medicare, future health care costs need not be considered in lawsuits.) Joel Lexchin, MD, emergency physician at the University Health Network in Toronto and author of over 60 peer-reviewed articles, spoke on the questions of pharmaceutical regulation and drug costs, comparing the U.S. and Canada. Public health official and family physician Rosana Pellizzari, MD, discussed the Chaoulli decision and the struggle to resist privatization of health care in Canada. Along the way, Dr. Pellizzari addressed the problem of waitlists in Canada’s health system. She included a slide of the lawn sign of the Canadian Health Coalition: “Protect Medicare: Don’t privatize it!” Dr. Himmelstein suggested that it was a yard sign that might do just as well south of the Canadian border.

Rocky White, MD, an internist from Alamosa, Colorado, a self-described “hard-core, dyed-in-the-wool, capitalistic, fee-for-service Republican” gave an animated speech. Dr. White became convinced of the need for a single-payer solution after his Nebraska multi-specialty group was forced into a buy-out by the local hospital in 2004 due to the increasing number of uninsured and underinsured. He called upon health care reform activists to work to unite diverse communities around the demand for single-payer health reform, no matter how deep disagreements on other issues might be. He quoted from the Bible to show how he has called upon his own conservative Christian community to stand up for the uninsured. Dr. White also spoke about Martin Luther King, Jr., the 1965 Selma march across the Edmund Pettis Bridge, and passage of the Voting Rights Act as a hopeful example of the tempo that large movements for social change may develop.

Founder of Vermont Health Care for All, Deb Richter, MD, a Vermont family physician and past PNHP president, spoke on the panel together with Dr. White. She showed slides from a talk she has given hundreds of times to make the case that health care reform is in the interest of business. She reported that business people respond favorably to the argument that much of health care costs are fixed infrastructure costs (perhaps more than 70%) that should be borne by the whole society. To illustrate, she tells business people that, when someone goes to the emergency room, we are not paying for the sick person but for the nurse who will be there at the ready.

Ana Malinow, MD, pediatrician at the Harris County Hospital District Ben Taub General Hospital Pediatric Emergency Center and co-founder of Health Care for All Texas, spoke on lessons from Hurricane Katrina. An organizer of the Houston Astrodome medical clinic — where over 15,000 patient visits took place over a span of two weeks, including 2,000 visits in one day, and at one point, 100 visits per hour — Dr. Malinow said that practicing medicine had never been so rewarding for the physicians involved: the emergency conditions forced bureaucracy and billing paperwork to vanish, leaving the doctor-patient relationship unfettered. She underscored the strain that Hurricane Katrina placed upon the already stressed Texas health system — following Hurricane Katrina, some 373,000 people re-located to Texas. (Of these, 59,680 had been covered by Medicaid.) The annual increased cost to the state of Texas could be about $1.6 billion — provided the health system can absorb the increased demand for services.

From Louisville, Kentucky, Garrett Adams, MD reported on the vigorous work the PNHP chapter there, particularly with successful interventions at a broad range of meetings, “including those to which we were invited as well as those at which we were not invited to speak.” Also in attendance from Louisville was Kay Tillow, Director of the Nurses Professional Organization, who has spearheaded an effort to gain union support for HR 676, “The United States Health Insurance Act.” At dinner, the Executive Director of the California Nurses Association, Rose Ann DeMoro spoke to the PNHP members. The California Nurses Association recently merged with the AFL-CIO with the specific goal of leading a union campaign for a single-payer health care system.

Dr. Himmelstein, as a panel respondant, offered remarks on the importance of unconventional thought and a diversity of approaches to building a movement for a single-payer health system — just as the diversity of patients demands a diversity of doctors. He told a story of a patient, a smoker, who had suffered a heart attack. After the episode subsided, the patient went to see a cardiologist. The cardiologist asked if the patient had quit smoking. The patient replied that he had smoked for decades and had no intention of quitting just because he had had a heart attack. The cardiologist, an intense and excitable man, began jumping up and down, swearing at the patient and yelling words to the effect that he would “not take care of a goddamned smoker.” This so frightened the man that he quit smoking — “which is either brilliant medicine or utter malpractice,” Dr. Himmelstein concluded.

Don McCanne, MD was welcomed by warm applause as he participated in afternoon panel discussions from the stage. He is the author of the listserv Quote of the Day, which PNHP activists rely upon. He concluded his remarks on the strategy for health reform by saying: “We have a mission to educate. We will educate our colleagues, the policy community, the media, and our patients.”

http://mrzine.monthlyreview.org/coates050106.html

Half of U.S. Health Care Workers Get Flu Shots

FOR IMMEDIATE RELEASE
JANUARY 24, 2006

Cambridge Health Alliance: Alison Harris, aharris@cha.harvard.edu (617) 499-8323 UCLA: Elaine Schmidt, eschmidt@mednet.ucla.edu (310) 794-2272

Click Here For Study Text
RESEARCH ALERT

LESS THAN HALF OF U.S. HEALTHCARE WORKERS GET FLU SHOTS FINDS UCLA/HARVARD STUDY; HEALTHCARE WORKER’S LACK OF ACCESS TO HEALTHCARE PUTS PATIENTS AT RISK

FINDINGS: UCLA and Harvard researchers analyzed data from the 2000 National Health Interview Survey to measure flu vaccination rates among U.S. healthcare workers. From a nationally representative sample of 1,651 workers, the overall vaccination rate was only 38 percent. Rates were particularly low in workers who were health aides (e.g. nurses aides, medical assistants or orderlies), African American, or under 50.

IMPACT: The low flu vaccination rate among healthcare workers increases their likelihood of contracting the flu and passing it to patients. Healthcare workers, especially those who are minority, poor, or young, need both better education and improved access to primary care in order to reduce the spread of flu. Inequalities in healthcare currently undermine our ability to stop flu transmission. Should an epidemic of bird flu emerge, such inequalities will hamstring efforts to contain it.

BACKGROUND: More than 36,000 people died between 1990 and 1999 from influenza, the sixth leading cause of death in the nation. A severe pandemic of bird flu might kill many times that number. The Centers for Disease Control and Prevention recommend vaccinating healthcare workers with direct patient contact as a priority in preventing spread of the disease. Yet many healthcare workers lack access to healthcare for their own medical needs. Earlier studies have found that 12.2% of healthcare workers have no health insurance coverage. Workplace vaccination programs are also failing to reach such workers.

AUTHORS: Dr. William King, visiting assistant physician, Department of Infectious Diseases, David Geffen School of Medicine at UCLA; and Dr. Steffie Woolhandler, physician at Cambridge Health Alliance and associate professor of medicine at Harvard Medical School, are available for interviews. Two of the other authors work at Cambridge Health Alliance: David H. Bor (Infectious Disease Specialist and Chairman of the Department of Medicine) and David U. Himmelstein (Associate Professor of Medicine, Harvard Medical School).

JOURNAL: The research will appear in the February edition of the peer-reviewed Journal of General Internal Medicine, Vol. 21, No. 2.

FUNDING: Funding from the National Institutes of Health supported the research.

Take a Hike

By Nicholas D. Kristof
New York Times, op-ed
January 31, 2006

First, a quiz: What “vegetable” do American infants and toddlers eat most?

Weep, for it’s the French fry. A major study conducted by Gerber found that up to one-third of young children don’t eat any vegetable daily, but that the French fry is the single most common one they do consume. And among children age 19 months to 24 months, 20 percent eat French fries at least once a day.

President Bush is slated to discuss health care in his State of the Union address tonight. It’s about time: it’s scandalous that babies born in the United States are less likely to survive their first year than babies born in Slovenia. But the solutions to the health crisis lie less in reorganizing medical treatment than in improving public health — such as steering kids away from French fries.

Think of two of the biggest breakthroughs in improving Americans’ health over the last generation or two. They had nothing to do with doctors, but arose from higher cigarette taxes and other efforts to discourage smoking, and from compulsory seatbelts and improvements in auto safety.

So what can we do? In my last column, I praised Gov. Mike Huckabee of Arkansas for leading a series of initiatives to confront obesity and lack of exercise. Health experts suggest a variety of others (a book by Tom Farley and Deborah Cohen published last year, “Prescription for a Healthy Nation,” offers excellent ideas). Building on them, here are my suggestions:

Ban soda, potato chips and other unhealthy snacks from American schools, and discourage them in the workplace. It’s unforgivable that our schools help to send children on the road to diabetes. Obesity kills far more Americans than heroin does.

Sell cigarettes only in pharmacies and raise cigarette taxes. Smoking still kills 440,000 Americans a year, including 50,000 nonsmokers. One study found that raising the federal excise tax on cigarettes by 75 cents a pack would generate $13.1 billion in additional revenue per year and cut youth smoking by 13 percent and adult smoking by 3 percent, saving 1.2 million lives. Let’s do it.

Tax junk foods. Some 19 states already impose taxes on particular junk foods, like soda, and a nickel-a-can tax on soft drinks would generate $7 billion in revenues. In particular, we should tax high-fructose corn syrup, which is used as a sweetener in a vast array of products and is a major culprit in the fattening of America.

Promote jogging and biking. Since we pay for all the consequences of inactivity (like those heart bypasses), we should encourage exercise. We should build more bicycle paths and turn more streets over to bikers, skaters and pedestrians — starting with Sixth Avenue in Manhattan.

Encourage exercise breaks. Governor Huckabee gives state employees a 30-minute daily “exercise break” that is modeled on the smoking breaks that smokers take. It’s a good idea.

Distribute fruits and veggies to certain low-income people, as Maine does in FarmShare, a potent antipoverty program.

Expand P.E. It’s ridiculous that schools have been cutting back on P.E. when students need more of it. Likewise, kids should be encouraged to walk to school. When my eldest son attended a Japanese elementary school in Tokyo, the school required him to walk or bike to school beginning in the first grade.

Design better stairways. The default system for getting from one floor to the next in America (but not the rest of the world) is the elevator. Let’s encourage stair use instead, by having new buildings constructed with open and appealing stairs that are actually meant to be used — while perhaps making elevators dark, dingy and out of the way.

I’m sure there are other creative approaches. I’ve thought of subsidies for running shoes, which make more sense than subsidies for corn. And since the average American child spends 24 hours a week sitting in front of a television, how about developing televisions for kids that are powered by Exercycles?

Look, personally I’m convinced that we need universal health care based on a single-payer system. But that is not politically feasible now, while a systematic assault on the causes of American ill health could make a big difference.

Granted, a War on Sloth isn’t as dramatic for the Bush administration as a War on Terrorism. And for Democrats, attacking junk food isn’t as attention-grabbing as denouncing corruption in Congress. But there is perhaps no area of public policy where it would be easier to save the lives of countless Americans than in promoting public health.

Henry Aaron on rationing

A healthcare prescription that’s hard to swallow Rationing may be the only way to ensure that access for all remains affordable
By Henry Aaron
Los Angeles Times
January 30, 2006

Something needs to be done, but no one seems quite ready to come forward with a solution. The only thing American politicians all agree on is this: The United States must at all costs avoid healthcare “rationing.” One after another, they step forward to deplore this much-hated approach, insisting they will fight off efforts to deny the insured any beneficial service that their insurance covers.

But it’s too late for that. The truth is that sensible rationing may be the only way to make sure that fair access to healthcare for all remains affordable. The U.S. can no longer afford to offer every available service no matter how high the cost or how small the benefit to the patient.

Intelligent healthcare rationing – limiting the availability of care that costs society more to produce than it is worth to patients – is not a horror to be avoided. It’s a regretfully necessary limit to sustain fair access to healthcare that is worth what it costs.

Some people argue that simply boosting deductibles will encourage consumers to squeeze out low-benefit care because they won’t want to spend their own money without a high chance of a good outcome. Unfortunately, this approach is being greatly oversold. First, patients whose healthcare costs more than $4,000 a year consume roughly 80% of all health services. They are, of course, the sickest – and their doctors, acting in good faith, prescribe tests, procedures and drugs, most of which are demonstrably beneficial but some of which have only a small chance of helping the patients much, if at all. These very sick patients are in no position to decide which treatments are cost effective, which are likely to work and which are probably wasteful. So “consumer-directed healthcare” – a clever marketing label for high-deductible insurance that makes the patient pay the first $4,000 – won’t do much to curb high-cost, low-benefit treatments for those patients.

Other analysts believe that computerizing healthcare records and billing would reduce paperwork and costly medical errors. But careful estimates put the savings at no more than about 3%.

The kind of rationing that is necessary will require steps that may now seem unimaginable to most Americans and to elected officials, including restrictions on the purchase of costly equipment, caps on hospital budgets and well-enforced protocols for using treatments that have been proved effective for various conditions. Failure to ration, however, will mean that the cost of caring for the aged, disabled and poor will require astronomical tax increases – and that working Americans will have less money to spend on anything other than healthcare. Employers will find it increasingly unattractive to sponsor coverage for workers, and workers will refuse increasingly costly coverage. What Winston Churchill said of democracy may also apply to healthcare rationing: the worst system – except for all the others.

http://www.latimes.com/news/opinion/commentary/la-oe-aaron30jan30,0,885710,print.story?coll=la-news-comment-opinions

Comment: By Don McCanne, M.D.

“Ration refers to equitable division in limited portions of scarce, often necessary, items.” (The American Heritage Dictionary of the English Language, Fourth Edition)

Henry Aaron’s leading message of the past decade is an important one. Health care spending has reached a level that we must now consider “limiting the availability of care that costs society more to produce than it is worth to patients.” “Rationing” may not be quite the appropriate term since health care in the United States is not a scarce resource, though our distribution is limited based on our flawed system of funding care. Limiting access based on ability to pay does make it a somewhat scarce resource for those who cannot afford to pay for their care.

Although Aaron’s message on controlling spending on wasteful high-tech excesses is an important one, his message on how we do that seems muddled, if not obstructionist. Single payer activists are certainly offended with his pompous assertion that “no one seems quite ready to come forward with a solution.” Also, he does not move reform forward when he attacks a seminal article on administrative waste as “questionable answers to a questionable question.”

The single-payer model of national health insurance would accomplish much of Aaron’s goal, including measures that he explicitly endorses: budgeting of capital improvements, global budgeting for hospitals, and increased use of evidence-based medicine. In spite of his attack on the numbers, he does concede that much is wasted in excess administrative costs, another potential source for controlling spending. Policy experts are already aware of the other effective single-payer methods of controlling costs while improving quality and value, so they won’t be repeated here.

One caveat: We cannot allow Aaron’s use of the term “rationing” to be used by the opponents of single payer to attack our model. It has been demonstrated repeatedly that improving use of health care resources prevents excessive queues. Also, a single-payer purchaser is in a position to demand value for new innovations. That means only that worthless technology would be rejected. The pharmaceutical and high-tech industries will never walk away from the $2 trillion that we are spending on health care, but they are going to have to show us that their advances provide value.

Yes, all systems ration care, but some systems use their resources better than others. With our inhumane method of rationing by ability to pay, we do the worst. By switching to a single payer system of allocating our $2 trillion, we would change the dialogue on reform from that of “rationing” to that of “rational.”

Drug plan needs dose of simplicity

Opinion
Atlanta Journal Constitution
January 27, 2006

The fiasco during the first few weeks of Medicare’s prescription drug program seems to provide critics of government-provided health insurance with a wealth of ammunition.

But before firing off the first round, those critics should look closely at what has happened. Yes, the program has been a disaster. But it has been a disaster mainly because government turned its citizens into captive customers for private firms looking to maximize their own profits, then provided those citizens little protection.

The biggest immediate problem was an example of the fundamental flaw with the plan. An estimated 6.2 million beneficiaries (including about 135,000 in Georgia) had drug coverage through state Medicaid programs and under law had to be moved into one of the new federally funded but privately operated Medicare plans.

Some of these poor and elderly patients never got assigned to a private drug plan; others did get switched, but information about their enrollment didn’t get transferred from government computer databases to those maintained by the private companies.

On Dec. 31, those people were doing fine with the government drug plan they had, but after Jan. 1 — the date the new Medicare plan went into effect — many were told their newly assigned plan did not cover the drugs they routinely take to stay alive.

Computer records were often missing and pharmacies had to extend their customers credit. In about half the states, government officials had to step in and guarantee coverage until the glitches were fixed.

While some of those technical difficulties are being ironed out, other problems won’t be solved so easily. For example, consumers are still being forced to choose from dozens of plans offered by private companies, each with its own schedule of co-payments, monthly premiums and lists of which drug it will cover. Trying to make financial sense of all those options would challenge even a professional accountant, yet senior citizens are being forced to make that decision with little or no assistance.

Contrast that with how traditional Medicare pays for hospital care: The hospital is paid a flat rate based on the patient’s diagnosis, severity of illness and length of stay. The patient is not forced to choose among competing plans for hospital care, and rarely sees a bill. Medicare tells the hospital what it will pay. (Physician services come under another relatively simple Medicare plan with fixed premiums and standard benefits).

So far, Medicare has enrolled about 24 million beneficiaries in the new plan, but many of those already had some form of drug coverage. Unfortunately, the worst sign-up rate is among the 12 million to 15 million beneficiaries who had little or no drug coverage to start with. Only about 3.6 million of these low-income Medicare beneficiaries have signed up for one of the drug plans.

At some point the nation’s senior citizens and others covered by Medicare will demand to know why the drug program is so complicated and works so poorly compared to the simplicity and cost-effectiveness of how Medicare handles hospital and physician coverage, and how it can be changed.

The answer will be a national health insurance program utilizing the government’s purchasing power to provide the highest quality of care at the most reasonable cost, for patients and taxpayers alike.

Junk Medicaid

By Alex Gerber
Washington Times
January 29, 2006

Medicaid, the government health-care plan for low-income people, has been targeted by congressional mediators as a prime source for savings in a bloated federal budget.

Medicaid’s costs have increased a staggering 54 percent in the past five years. This has been deemed “unsustainable.” Jointly financed by the federal and state governments, the program now accounts for an average 25 percent of state budgets, threatening many with insolvency.

A lowering of Medicaid costs by $6.9 billion is proposed over the next five years, which will decrease benefits and raise out-of-pocket expenses for the 47 million Americans covered by Medicaid. The nonpartisan Congressional Budget Office predicts an appreciable number of Medicaid recipients, finding the additional costs unaffordable, will join the ranks of the medically uninsured. The adverse morbidity and mortality statistics of the uninsured are well documented.

Medicaid’s problems were far from anticipated in 1965 when passed into law under the jurisdiction of the former federal Department of Health, Education and Welfare (HEW). At the time, I was a health care consultant to HEW Commissioner Dr. Ellen Winston and remember well the department’s euphoria over Medicaid’s prospects. All the public charity hospitals were to be phased out within 10 years, and “second-class care” was to be eliminated as Medicaid recipients were shunted into the private care “mainstream.”

But within three years, a federal commission was investigating gross fraud and an explosion of Medicaid costs. The program continued downhill as doctors’ fees were slashed, benefits cut and only about 50 percent of the poverty class and the working class near poverty remained in the program.

Few are happy with Medicaid today. Patients are unhappy with eligibility red tape and the declining number of doctors willing to treat them. Doctors are unhappy with the mountains of paper work and unrealistically low fees. Most hospitals are unhappy because Medicaid’s reimbursement doesn’t cover the cost of patient care so they only remain afloat by shifting costs to private patient insurance plans. But unhappiest of all are government agencies struggling to control costs that have escalated far beyond their original projections. Meanwhile, the public hospitals are alive but not well.

Medicaid is simply another example of medical socioeconomics not keeping pace with brilliant advances of medical science and technology. After 40 years, we must reluctantly conclude Medicaid has been a well-intentioned program that has fallen short of expectations and that further Band-Aid efforts to resuscitate the program should be abandoned.

The great majority of Americans, however, believe health care should be a fundamental right and a public rather than a private good. A single standard of health care, regardless of ability to pay, is in concert with the beliefs of most Europeans and Canadians. What, then, should replace Medicaid?

The easiest answer is to include health care for the medically indigent in the badly needed reform of our “broken health-care system,” which has become a crisis.

Our outmoded, employer-based, privately financed, multipayer health-care system — a holdover from World War II wage-and-price controls — is an anachronism in the 21st century. The world’s richest and mostt powerful nation is unique in not sponsoring government-controlled Universal Health Insurance (UHI) other industrialized nations have enjoyed for decades.

Unlike Medicaid, Medicare — UHI for the elderly — has been a resounding success. Medicare, though also targeted by Congress for budget cuts by increassing patient-out-of pocket payments, is indeed widely recognized as the most important advance of the last century in our health-care socioeconomics. Medicare for our entire population is probably the most likely answer to Medicaid’s “meltdown.”

I have previously advocated on these pages a change to the Canadian, single-payer health-care plan funded by national health insurance. The need to find a substitute for Medicaid provides an opportune time to hasten this change.

Briefly, Canada’s health-care system provides one standard of care for its entire population under a plan funded by tax dollars, and there are no additional expenses at the time of treatment. Canada’s medical results equal ours at a huge savings.

Perhaps the superiority of Canada’s health-care system was best expressed by a Harris Interactive Poll among the leading industrial societies that evaluated patient satisfaction with their system: Canada ranked first and the U.S. last. Moreover, 50 percent of Americans favor the Canadian health-care system and only 8 percent of Canadians prefer ours. Significantly, The new Conservative government in Canada did not advocate major changes in the UHI program.

Of interest is a comparison of prescription drug prices in the U.S. and Canada. Our new Medicare Prescription Drug legislation, with some 40 plans to choose from, is a mishmash of confusion and a rich source of material for cartoonists and late-night TV comedians.

The attempt to constrain skyrocketing drug prices was hamstrung from the beginning by President Bush’s insistence there be no price negotiations with pharmaceutical companies. Thus, our Medicare population, 41 million strong, has been denied the advantage of bulk-buying economies of scale. Imagine the uproar if Hertz and Avis were, by law, denied discounted prices on autos they purchased in huge lots.

Since 1987, Drug prices in Canada have been regulated by the Patented Medicine Price Review Board, a quasijudicial body that negotiates prices with the drug industry. Prices are held in check because they are geared to the Consumer Price Index. The drug houses know the rules; only four times in the last 18 years has legal action been taken to force drug prices lower.

The future for national health insurance looks bleak. The issue has never been on President Bush’s agenda. Indeed, during his governorship, 24½ percent of Texans were medically uninsured — the highest of the 50 states. During his presidency, the uninsured have increased by 4 million and continue rising 100,000 monthly.

A major reform of our wasteful health-care system will help put the brakes on an inexorably rising national debt that will eventually fall on our children and grandchildren.

It would be well to recall an admonition from George Washington’s 1796 Farewell address: “by vigorous exertion to discharge the debt” — not ungenerously throwing upon posterity the burden which we ourselves ought to bear.

Alex Gerber, M.D., clinical professor of surgery, emeritus at the University of Southern California, is a former health-care consultant to the White House and the U.S. Department of Health and Human Services.

Third Building & Construction Trades Council Endorses HR 676

Collinsville, IL A third AFL-CIO Building and Construction Trades Council has endorsed legislation that would institute a single payer health care system in the U.S. by expanding Medicare to cover everyone.

The Southwestern Illinois Building & Construction Trades Council joined two other building Trades Councils in St Louis, MO and Cape Girardeau, MO endorsing the legislation introduced by Cong. John Conyers (D-MI).

HR 676 now has 62 congressional co-sponsors in addition to John Conyers Jr. (D-MI). It would institute a single payer health care system in the U.S. by expanding a greatly improved Medicare system to every resident.

HR 676 would cover every person in the U. S. for all necessary medical care including prescription drugs, hospital, surgical, outpatient services, primary and preventive care, emergency services, dental, mental health, home health,
physical therapy, rehabilitation (including for substance abuse), vision care, chiropractic and long term care. HR 676 ends deductibles and co-payments. HR 676 would save billions annually by eliminating high overhead and profits of the private health insurance industry and HMOs.

Support swells for universal health care: Ky. panel endorses plan for U.S. system

By Laura Ungar
Monday, January 30, 2006
The (Louisville, KY) Courier-Journal

It is the paradox of America’s medical system: While hands can be transplanted and the tiniest babies kept alive, many people cannot afford to see a doctor and live with the threat of financial ruin if they get sick.

Francene Shepard of Louisville had a heart attack in 1999, needed stents to open blocked arteries and ran up about $50,000 in medical bills that went unpaid.

Ian Copeland, a 27-year-old self-employed carpet cleaner who lives in Louisville, goes to the emergency room when he’s sick because he cannot afford a private doctor.

“It’s a gamble,” said his mother, Michelle Copeland. “If something happens, it could be devastating.”

Such stories are increasingly common and are leading to growing support among some politicians and medical groups for implementing a national health system offering care for all, including the 45 million Americans and more than half a million Kentuckians without health insurance.

Earlier this month, the Kentucky House Health and Welfare Committee voted to urge Congress to pass a bill, introduced by Democratic Rep. John Conyers Jr. of Michigan, that would expand Medicare to cover all Americans.

The bill would create a “single-payer” health-care system, publicly financed and privately delivered. All Americans would have access regardless of employment, income or health. Each year, the program would set reimbursement rates for health-care providers and negotiate the cost of prescription drugs.

Critics say such a measure would be too costly and unwieldy, but the passion of supporters was evident when the Kentucky House committee vote was called, and Rep. Kathy Stein, D-Lexington, answered: “Hell, yes!”

Conyers’ office and the group Physicians for a National Health Program are watching Kentucky and hoping that the General Assembly will back the effort.

“It would be historical to have a Southern state endorse universal health care and medicine for all,” said Joel Segal, a legislative assistant for Conyers who handles health-care issues. “This is a life-and-death crisis for many people.”

A possible groundswell

A 2002 report by the Institute of Medicine, which advises the federal government on health issues, said 18,000 adults die each year because they lack health insurance. Overall, the United States has a lower life expectancy than several countries, including Canada and the United Kingdom, that have national systems.

“The health-care system is in a deepening crisis,” said Dr. Steffie Woolhandler, an associate professor of medicine at Harvard University and co-founder of Physicians for a National Health Program. “The public is quite fed up.”

There are signs that the idea of a national system has increasing support here:

A poll last year by the Pew Research Center found that 65 percent of Americans favor national health insurance, even if it means higher taxes.

An Indiana University poll, published in the Annals of Internal Medicine in 2003, said 49 percent of doctors support government legislation to establish national health insurance, while 40 percent oppose it.

Membership in Physicians for a National Health Program, meanwhile, has risen from about 10,000 to 14,000 in recent years.

City councils have passed resolutions in support of the Conyers’ bill in Morehead, Ky.; Baltimore; and Erie, Pa.

Locally, Conyers’ proposal has gained support from the Kentucky Psychiatric Medical Association, the Louisville-based Falls City Medical Society, and Dr. Adewale Troutman, director of the Louisville Metro Health Department.

A faction of the Kentucky Medical Association also supports the idea of a national health system, said its president, Dr. Daniel Varga.

And although Varga and others say they doubt that the United States will be ready, philosophically, to enact a national health plan anytime soon, experts say the debate points to a growing dissatisfaction with the status quo.

That sentiment has been reflected in polls such as one released last week by the Center for American Progress and the Service Employees International Union, which found that nearly nine out of 10 Americans think the current system is broken.

Opposition to proposal

Although opponents agree that the problem of the uninsured must be addressed, they say a national system would drive up taxes, stifle medical innovation and lead to waits for services.

“If you think you can get free health care and you don’t have to pay for it in some way, you’re being naïve,” said Robert Moffit, director of the center for health policy studies at the Heritage Foundation, a Washington-based conservative think tank.

Moffit pointed to a proposal for a state-level universal plan in Oregon that would have required a new personal income tax of as much as 8 percent and a payroll tax for businesses of 3 percent to 11.5 percent.

In addition to tax increases, Moffit said, “once the health-care dollar becomes a part of the federal budget, it competes with education and other priorities.”

State Rep. Bob DeWeese, R-Prospect, a retired physician who voted against the Conyers resolution in the Kentucky House committee, also expressed concern about rising taxes.

He said something must be done about the growing number of uninsured Americans, but “we don’t have to change the whole system to fix this problem.”

Proponents argue that a national health plan would save money. In recent years, increases in insurance premiums have far outpaced inflation. A summary of the Conyers bill says 95 percent of families would pay less for health care under the plan than they do today.

Moffit argued that ultimately, the quality of care would suffer with a national setup, partly because such systems generally don’t invest as much in medical technology.

He also pointed to waits for services. One recent survey by a Canadian economic think tank called the Fraser Institute — which seeks to bring attention to the issue of market competition — found that waiting times there between referrals and treatment averaged 17.7 weeks across specialties last year.

Proponents of national health care say that concern is overblown.

But Julia Costich, chairwoman of the department of health services management at the University of Kentucky, said the Conyers bill stands little if any chance of passing, partly because it calls for such sweeping change.

“I applaud their ambition,” Costich said of proponents, “but it seems very far-fetched.”

Idea spreading

Kentucky is not the first state to show support for a government-run health system. Some states have gone so far as to move toward their owns plans. In Oregon, where voters rejected a single-payer proposal in 2002, supporters are pushing for another measure in 2008.

In Ohio, a coalition claims it has collected tens of thousands of signatures in support of such a plan and hopes to put the issue on the ballot next year.

Maine already has a program offering affordable health-care coverage that aims to cover all uninsured residents eventually.

Dr. Garrett Adams, a retired physician who heads up the Kentucky chapter of Physicians for a National Health Program, said universal health care is a matter of fairness and humanity. His group prefers a national system to state efforts.

Adams said the problems faced by the uninsured are particularly acute in Kentucky, which was shown in a recent Courier-Journal investigation to be among the least healthy states in the nation.

“This is so wrong,” Adams said. “They’re real lives. They’re people.”

Shepard, a 51-year-old home health aide who spoke before the state House Health and Welfare Committee, said that since her heart attack, she has been diligent about getting care at the Family Health Centers’ Portland clinic.

But with a low income, specialized care can be a struggle.

A national program would help her “and others like me who fall through the cracks,” she said in an interview.

One patch of common ground for supporters and opponents is the belief that the current U.S. system has serious problems.

A 2003 ABC News/Washington Post poll showed that more than half of Americans are dissatisfied with the quality of health care, the first majority in three polls since 1993.

Sandie Limpert of Louisville, a 53-year-old graduate student who has gone half her adult life without health insurance, said she believes the system is in such disarray that a major overhaul would be better than small reforms.

“It’s like we’re trying to plug our fingers into the dam,” she said. “But it’s only a matter of time before the whole thing cracks and explodes.”

Reporter Deborah Yetter contributed to this story.

HSAs as IRAs, and The Economist's take on the Bush plan

Savings Accounts for Health Costs Attract Wall Street
By Eric Dash
The New York Times
January 27, 2006

Even after the Bush administration began pushing for the creation of health savings accounts with the Medicare Modernization Act of 2003, the banking industry mainly stayed on the sidelines.

“Put it this way, the impact of this law did not really become clear to them until after it passed,” said Mr. Perrin, the H.S.A. Coalition director. Once they understood how the accounts worked, however, the big banks realized the next I.R.A. had landed at their feet.

Now, some financial institutions are urging the Bush administration and Congress to raise the tax-deductible contribution limit to encourage consumers to put more money in their accounts – a proposal that President Bush is expected to endorse in his State of the Union speech.

Banks are already champing at the bit. “We happen to be in the camp that the H.S.A. is a second retirement account to be used for medical expenses,” said Nancy Todor, an executive who will oversee health savings accounts when Citigroup introduces them this year.

http://www.nytimes.com/2006/01/27/business/27health.html?hp&ex=1138424400&en=433af284a9e52683&ei=5094
&partner=homepage

Comment: By Don McCanne, M.D.

Health savings accounts (HSAs) represent a hybrid of tax policy, health policy and pension policy. To understand them better, they should be viewed as individual retirement accounts (IRAs) with a special penalty-free exemption for early withdrawals that are used for authorized health care expenses.

They represent regressive tax policy. As with an IRA, contributions are made with before-tax income, effectively providing higher-income individuals with a taxpayer subsidy that lower-income individuals do not receive. The poor pay the full amount of the contribution while the rich receive a significant discount at taxpayer expense. Demonstrating how this really is an IRA, higher-income individuals who have maxed-out their 401k contributions are turning to HSAs to expand their pension contributions.

In his attempts to reform Social Security, President Bush stressed the importance of personal retirement accounts as an important component of the “ownership society.” HSAs, as specialized IRAs, provide individuals with another similar opportunity to save for their retirements. By increasing personal accounts, the dependency on Social Security would diminish. But who benefits? Cumulative pensions will be reinforced for healthy individuals who accumulate significant funds in these accounts. Individuals who have the misfortune of having significant health problems will have to deplete their specialized IRAs (HSAs). Their health care miseries will be compounded further by the fact that they also will lose these pension funds. They are then left with only a high-deductible health plan that leaves them even more vulnerable to health care costs.

Thus HSAs represent highly flawed health policy, flawed tax policy and flawed pension policy. What is of even greater concern is the Bush administration’s intent to accelerate this shift towards consumer-directed health care. We should heed the following comments excerpted from a new report in The Economist.

America’s health-care crisis
Desperate measures
The Economist
January 26, 2006

The world’s biggest and most expensive health-care system is beginning to fall apart. Can George Bush mend it?

Mr Bush wants to accelerate the trend towards consumer-driven health care.

The truth is that the shift to consumer-directed health care and greater cost-sharing involves a culture change that may take decades. It will also come at the price of greater inequality. The burden of health spending will be shifted on to those who are sick, and not just because people will pay a greater share of their health costs themselves. High-deductible insurance policies are attractive to the young and healthy. But as these workers leave traditional insurance, the risk pool in other insurance plans will worsen and premiums will rise even faster. The real losers will be poorer workers with chronic illnesses.

American health care has already become more unequal as employers have cut back, and this will continue. The Bush team argue that “fairer” tax treatment will slow cost rises and enable more people to get basic insurance. The opposite is more likely. Bigger tax subsidies for health care are, if anything, likely to raise overall spending. Worse, since most tax breaks benefit richer people most, more tax incentives are likely to bring more inequality. They will also reduce tax revenue and worsen the budget mess.

Mr Bush’s health-care philosophy has a certain political appeal. It suggests incremental change rather than a comprehensive solution. It reinforces existing industry trends. And it promises to be pain-free. Unfortunately, it will not work. The Bush agenda may speed the reform of American health care, but only by hastening the day the current system falls apart.

http://www.economist.com/world/displaystory.cfm?story_id=5436968

Healthcare on the critical list

Los Angeles Times
January 26, 2006

Re “Health Plan to Revive Debate,” Jan. 23

The problem with healthcare in the United States isn’t that Americans are over-insured — as claimed by many conservatives — but that private health insurers take up to 30% as administrative costs. Compare this with administrative costs of 2% for Medicare. America spends more on healthcare than any other country and doesn’t have results to show for it, as measured by leading health indicators as diverse as infant mortality and the number of uninsured people.

Healthcare is not a product that most people can compare and purchase, as one would a television or cellphone-service provider. Allowing people to save money from their personal health savings accounts by forgoing a clinic appointment, for example, will result in larger problems down the line, driving up costs and resulting in worse health outcomes.

Clearly, as people more knowledgeable than myself have proposed, the answer to the growing U.S. healthcare problem is universal single-payer coverage. The private insurance route is clearly not working. President Bush proposes more of the same.

Arman Afagh, MD
Riverside

More HSAs, but where's the money?

HSAs Triple in 10 Months
America’s Health Insurance Plans
January 26, 2006

At least three million consumers currently receive health coverage through high-deductible health insurance plans offered in conjunction with health saving accounts (HSAs), according to preliminary results of a new study by America’s Health Insurance Plans (AHIP).

“HSAs are a remarkable success story and they are proving to be especially attractive to many who might not otherwise be able to afford coverage,” said AHIP president and CEO Karen Ignagni.

http://www.ahip.org/content/pressrelease.aspx?docid=14641

And…

Prognosis Is Mixed for Health Savings
By Milt Freudenheim
The New York Times
January 26, 2006

President Bush has made “consumer-directed” health savings plans a cornerstone of his policy for addressing runaway medical costs, and he plans to push them again in the State of the Union address next week. But so far there is little evidence that the approach is helping many consumers come to grips with the high price of health care.

… in many cases, people have evidently signed up not because they are eager to direct their own medical spending but because the plan looked cheap or they had no other insurance option. And at least half of those enrolled have not put money in their health savings accounts.

Pat Schoeni, executive director of the National Coalition on Health Care, a group seeking better, more affordable medical care, said, “The savings accounts are not designed to help people pay for health care; they are designed to help employers unload their health care costs.”

http://www.nytimes.com/2006/01/26/business/26accounts.html

Comment: By Don McCanne, M.D.

One percent of Americans now have health savings accounts, and half of them are not funded. Maybe an empty savings account is affordable, but the care that it will purchase is not.

In his State of the Union address, President Bush will propose the expansion of health savings accounts. Hopefully he’ll explain to us how unfunded accounts will make health care more affordable.