PNHP

How would Marcus Welby, M.D. fare in an ACO?

How would Marcus Welby, M.D. fare in an ACO?

Family Physician Can’t Give Away Solo Practice

By Gardiner Harris
The New York Times
April 22, 2011

Handsome, silver-haired and likable, Dr. (Ronald) Sroka is indeed a modern-day Marcus Welby, his idol. He holds ailing patients’ hands, pats their thickening bellies, and has a talent for diagnosing and explaining complex health problems.

A former president of the Maryland State Medical Society, Dr. Sroka has practiced family medicine for 32 years in a small, red-brick building just six miles from his childhood home, treating fishing buddies, neighbors and even his elementary school principal much the way doctors have practiced medicine for centuries. He likes to chat, but with costs going up and reimbursements down, that extra time has hurt his income. So Dr. Sroka, 62, thought about retiring.

He tried to sell his once highly profitable practice. No luck. He tried giving it away. No luck.

Dr. Sroka’s fate is emblematic of a transformation in American medicine. He once provided for nearly all of his patients’ medical needs — stitching up the injured, directing care for the hospitalized and keeping vigil for the dying. But doctors like him are increasingly being replaced by teams of rotating doctors and nurses who do not know their patients nearly as well. A centuries-old intimacy between doctor and patient is being lost, and patients who visit the doctor are often kept guessing about who will appear in the white coat.

The share of solo practices among members of the American Academy of Family Physicians fell to 18 percent by 2008 from 44 percent in 1986. And census figures show that in 2007, just 28 percent of doctors described themselves as self-employed, compared with 58 percent in 1970. Many of the provisions of the new health care law are likely to accelerate these trends.

“There’s not going to be any of us left,” Dr. Sroka said.

Indeed, younger doctors — half of whom are now women — are refusing to take over these small practices. They want better lifestyles, shorter work days, and weekends free of the beepers, cellphones and patient emergencies that have long defined doctors’ lives. Weighed down with debt, they want regular paychecks instead of shopkeeper risks.

http://www.nytimes.com/2011/04/23/health/23doctor.html

Comment: 

By Don McCanne, MD

Having been a general practitioner (as family physicians were called in those days) even before Marcus Welby ventured onto our television screens, I identify closely with the model of the traditional, altruistic physician as exemplified by the fictional Marcus Welby and the real-life Ronald Sroka. In this day of a push toward integrated health care systems, as exemplified by accountable care organizations (ACOs), what role would us relics of Hippocratic medicine rightfully assume?

We don’t have to speculate on this since that question is already being answered. Although we are in a transitional phase, there is widespread recognition that we need to reinforce our primary care infrastructure. Patient-centered medical homes, community health centers, primary care divisions of multi-specialty centers, and non-profit health maintenance organizations organized as fully integrated health systems are some of the models that have established primary care as a central coordinating element in health care delivery.

Even Medicare has recognized this need and has moved funds from over-priced technology to under-priced primary care. We are beginning to see additional funds being directed to pay for care coordination under primary care.

But it isn’t just about money. When I was in practice, I simply accepted the fact that we were so busy that we had to extend office hours into evenings and weekends, and we had to renounce the luxury of sleep because of delivering babies in the middle of the night and assisting in emergency surgeries at all hours of the day and night. My sanity was preserved by rotating call with my brother, so that I had every other night and every other Sunday off call.

More than money, younger physicians are especially concerned about life-style issues. They don’t accept the grindstone that we were on, and I don’t blame them. But they don’t have to. The integrated delivery systems of today and the future offer not only much more freedom for lifestyle choices, they also offer practice environments that allow greater access to specialized and supportive services that improve both the quality of the practice experience and the quality of the care that patients receive.

So where do ACOs fit into all of this? Likely time will show that this was a fairly nebulous concept – a wish that by working together physicians and hospitals could reduce spending while improving quality – but the concept lacks a defining structure. But isn’t that what these integrated systems are already doing, and were doing before the term “accountable care organization” was even coined? So we already have the promise of ACOs without the bureaucratic boondoggle required in the Patient Protection and Affordable Care Act. We should expand these systems whether or not we label them ACOs.

So what would Dr. Welby do today? We can answer that because Dr. Welby is alive and well and replicated throughout today’s medical school graduates, and those graduates are turning once again to primary care. The future of health care is in the good hands of these dedicated women and men who still cherish our Hippocratic values.

****

In the article, David J. Rothman, president of the Institute on Medicine as a Profession at Columbia College of Physicians and Surgeons, was quoted as follows: “Those of us who think about medical errors and cost have no nostalgia — in fact, we have outright disdain — for the single practitioner like Marcus Welby.” His followup statement released in response to the article is reassuring, defusing somewhat his unfortunate rhetoric:

“The quotation attributed to me in the April 24th New York Times story on primary care does not reflect the opinion, views or policy of the Institute on Medicine as a Profession. Nor does it accurately reflect my views. I have far too much respect for the medical profession, including solo practitioners, to make such offensive and derogatory statements. Rather, what I was trying to convey in a lengthy interview with the reporter (Gardner Harris) was my observations on what was being said and thought among a subset of health policy experts. However controversial or even misguided these views may be, they are seen as an aspect of the movement away from solo practitioners. It was not my intention to support or endorse this position but to call attention to it.

“To understand the principles that IMAP stands for, please read our agenda and mission. They contain descriptions of our programs promoting professionalism, including physician education and advocacy well as managing conflict of interest and strengthening evidence based medical practice.

“All of us concerned with medicine as a profession recognize that the decline of solo practice and the rise of group practice represent a crucial development that must be closely analyzed. We must consider how professionalism can best be maintained and strengthened under new types of delivery systems. Disparaging comments, whether wrongly attributed to me or to others, only serve to undercut constructive thinking and innovative policies.”

http://www.imapny.org/about_imap/news__announcements/4-25-11

The Special Doctor-Patient Relationship

Letters
The New York Times, April 25, 2011

Re “Patients Are Not Consumers” (column, April 22): Bravo to Paul Krugman. As a physician for 44 years, I have seen the sick person seeking medical care transformed from a patient to a consumer and, like Mr. Krugman, I have been sickened by this.

Raised in a family of doctors, I was fed on medical ethics. Vulnerable patients rely on the ethical principles of their physicians. They should never have to fear that their physician will look at them only as consumers of the commodity called health care: fair game from whom the largest possible payment should be extracted.

Most physicians are motivated first by the desire to do good, to help their patients, not by greed. We will do more to help the situation by appealing to their ethical principles rather than to their business prowess.

It is time for us to join the rest of the industrialized world and treat health care as a social need instead of as a commodity. A Medicare-for-all national health plan would transform the patient back to what he is: a person in need of care, not a “consumer.” The Independent Payment Advisory Board created under the new health care law would fit such a plan.

ELIZABETH R. ROSENTHAL
Larchmont, N.Y., April 22, 2011

How would Marcus Welby, M.D. fare in an ACO?

Family Physician Can’t Give Away Solo Practice

By Gardiner Harris
The New York Times
April 22, 2011

Handsome, silver-haired and likable, Dr. (Ronald) Sroka is indeed a modern-day Marcus Welby, his idol. He holds ailing patients’ hands, pats their thickening bellies, and has a talent for diagnosing and explaining complex health problems.

A former president of the Maryland State Medical Society, Dr. Sroka has practiced family medicine for 32 years in a small, red-brick building just six miles from his childhood home, treating fishing buddies, neighbors and even his elementary school principal much the way doctors have practiced medicine for centuries. He likes to chat, but with costs going up and reimbursements down, that extra time has hurt his income. So Dr. Sroka, 62, thought about retiring.

He tried to sell his once highly profitable practice. No luck. He tried giving it away. No luck.

Dr. Sroka’s fate is emblematic of a transformation in American medicine. He once provided for nearly all of his patients’ medical needs — stitching up the injured, directing care for the hospitalized and keeping vigil for the dying. But doctors like him are increasingly being replaced by teams of rotating doctors and nurses who do not know their patients nearly as well. A centuries-old intimacy between doctor and patient is being lost, and patients who visit the doctor are often kept guessing about who will appear in the white coat.

The share of solo practices among members of the American Academy of Family Physicians fell to 18 percent by 2008 from 44 percent in 1986. And census figures show that in 2007, just 28 percent of doctors described themselves as self-employed, compared with 58 percent in 1970. Many of the provisions of the new health care law are likely to accelerate these trends.

“There’s not going to be any of us left,” Dr. Sroka said.

Indeed, younger doctors — half of whom are now women — are refusing to take over these small practices. They want better lifestyles, shorter work days, and weekends free of the beepers, cellphones and patient emergencies that have long defined doctors’ lives. Weighed down with debt, they want regular paychecks instead of shopkeeper risks.

http://www.nytimes.com/2011/04/23/health/23doctor.html

Having been a general practitioner (as family physicians were called in those days) even before Marcus Welby ventured onto our television screens, I identify closely with the model of the traditional, altruistic physician as exemplified by the fictional Marcus Welby and the real-life Ronald Sroka. In this day of a push toward integrated health care systems, as exemplified by accountable care organizations (ACOs), what role would us relics of Hippocratic medicine rightfully assume?

We don’t have to speculate on this since that question is already being answered. Although we are in a transitional phase, there is widespread recognition that we need to reinforce our primary care infrastructure. Patient-centered medical homes, community health centers, primary care divisions of multi-specialty centers, and non-profit health maintenance organizations organized as fully integrated health systems are some of the models that have established primary care as a central coordinating element in health care delivery.

Even Medicare has recognized this need and has moved funds from over-priced technology to under-priced primary care. We are beginning to see additional funds being directed to pay for care coordination under primary care.

But it isn’t just about money. When I was in practice, I simply accepted the fact that we were so busy that we had to extend office hours into evenings and weekends, and we had to renounce the luxury of sleep because of delivering babies in the middle of the night and assisting in emergency surgeries at all hours of the day and night. My sanity was preserved by rotating call with my brother, so that I had every other night and every other Sunday off call.

More than money, younger physicians are especially concerned about life-style issues. They don’t accept the grindstone that we were on, and I don’t blame them. But they don’t have to. The integrated delivery systems of today and the future offer not only much more freedom for lifestyle choices, they also offer practice environments that allow greater access to specialized and supportive services that improve both the quality of the practice experience and the quality of the care that patients receive.

So where do ACOs fit into all of this? Likely time will show that this was a fairly nebulous concept – a wish that by working together physicians and hospitals could reduce spending while improving quality – but the concept lacks a defining structure. But isn’t that what these integrated systems are already doing, and were doing before the term “accountable care organization” was even coined? So we already have the promise of ACOs without the bureaucratic boondoggle required in the Patient Protection and Affordable Care Act. We should expand these systems whether or not we label them ACOs.

So what would Dr. Welby do today? We can answer that because Dr. Welby is alive and well and replicated throughout today’s medical school graduates, and those graduates are turning once again to primary care. The future of health care is in the good hands of these dedicated women and men who still cherish our Hippocratic values.

****

In the article, David J. Rothman, president of the Institute on Medicine as a Profession at Columbia College of Physicians and Surgeons, was quoted as follows: “Those of us who think about medical errors and cost have no nostalgia — in fact, we have outright disdain — for the single practitioner like Marcus Welby.” His followup statement released in response to the article is reassuring, defusing somewhat his unfortunate rhetoric:

“The quotation attributed to me in the April 24th New York Times story on primary care does not reflect the opinion, views or policy of the Institute on Medicine as a Profession. Nor does it accurately reflect my views. I have far too much respect for the medical profession, including solo practitioners, to make such offensive and derogatory statements. Rather, what I was trying to convey in a lengthy interview with the reporter (Gardner Harris) was my observations on what was being said and thought among a subset of health policy experts. However controversial or even misguided these views may be, they are seen as an aspect of the movement away from solo practitioners. It was not my intention to support or endorse this position but to call attention to it.

“To understand the principles that IMAP stands for, please read our agenda and mission. They contain descriptions of our programs promoting professionalism, including physician education and advocacy well as managing conflict of interest and strengthening evidence based medical practice.

“All of us concerned with medicine as a profession recognize that the decline of solo practice and the rise of group practice represent a crucial development that must be closely analyzed. We must consider how professionalism can best be maintained and strengthened under new types of delivery systems. Disparaging comments, whether wrongly attributed to me or to others, only serve to undercut constructive thinking and innovative policies.”

http://www.imapny.org/about_imap/news__announcements/4-25-11

America Needs a Single Payer Health Care System

Even if Obama's overhaul works as planned, there will still be 23 million Americans lacking health insurance in 2019

By Kay Tillow
Other Words, April 25, 2011

More than a year after President Barack Obama signed the Patient Protection and Affordable Care Act into law, our nation’s health care delivery and coverage remain the disgrace of the industrialized world. There are more than 50 million uninsured Americans. Even if the health care overhaul works as planned, 23 million Americans will still lack health insurance in 2019.

The new norm is underinsurance. About 40 percent of us go without needed care because we can’t afford it. The health care law won’t change that, even once it’s completely phased in. Our plague of medical bankruptcies will continue too.

For unions, bargaining for health care is getting tougher as employers demand cuts and shift more costs to workers. Negotiations over better health coverage will become almost impossible when the excise tax on health benefits begins in 2018.

Many who saw the reform bill as “the best we could get” are disappointed that support for it hasn’t grown. The truth is that most people agree on the reform law. They love the parts that block insurance companies from denying coverage and care. They hate the parts that give away our tax dollars to insurance companies. They hate the mandate that will force everyone to buy insurance from the very companies whose profit motive is the source of most of our health care system’s problems. They hate the escalating costs of insurance and care.

Only a single payer system can bring us the parts we love and do away with the parts we hate. It would essentially expand Medicare coverage to all Americans, providing 100 percent guaranteed coverage regardless of employment status or pre-existing conditions. That may sound expensive, but it’s not. The “potential savings on paperwork, more than $400 billion per year, are enough to provide comprehensive coverage to everyone without paying any more than we already do,” according to Physicians for a National Health Program.

Every pro-patient measure in the law brings an ugly backlash from insurance companies, because they want to remain in the driver’s seat. For example, the act says children who have been sick can’t be denied coverage. Insurers have responded by refusing to sell child-only policies. The act says there must be minimal standards of coverage. Yet hundreds of companies have obtained waivers after threatening to drop coverage altogether.

The legislation is designed to expand Medicaid as the main way for states to cover more people. It prohibits states from dumping people currently covered. Yet with state budgets in crisis, Medicaid is under the knife. Arizona plans on dumping 250,000. Many states propose increasing patient co-pays, thus damaging the ability of patients to find doctors and fatally undermining rural hospitals.

Some assert that healthcare reform just isn’t working. Yet. Give it 10 years, and all will be fixed.

But our new health law is anchored on the private insurance industry–and that’s its fatal flaw. The insurers inflict enormous and unnecessary administrative costs on our system. This amounts to hundreds of billions of dollars every year and condemns us to spend about double, per capita, what other nations spend on health care.

Health care advocates must move beyond the health care reform law. Rep. John Conyers (D-MI) has reintroduced H.R. 676, the Expanded and Improved Medicare for All Act, which would bring all medically necessary care to everyone while assuring choice of physician. The bill is based on sound single-payer policy and progressive public funding.

If every other industrialized nation can make health care a human right, we can do it too. Our challenge is to pass effective legislation despite the powerful private health insurance companies and other corporations whose influence often trumps democracy.

First, we must have a powerful movement. We can’t build it around a shriveled dream. Only single payer, with its bolder promise of social justice, can inspire that movement.

http://www.otherwords.org/articles/america_needs_a_single_payer_health_care_system

GOP's Medicare Plan Would Be a Windfall for Insurers

By Wendell Potter
Published on Friday, April 22, 2011 by PR Watch

Rep. Paul Ryan’s plan to privatize Medicare would accelerate a trend started several years ago by corporate CEOs and their political allies to shift ever-increasing amounts of risk from Big Business and the government to workers and retirees.

If enacted, the Ryan plan would represent a windfall of unprecedented proportions for insurance corporations and other businesses.

For millions of average Americans, many of whom already are finding it impossible to save for retirement, it would represent financial calamity. The nation’s middle class would pay dearly for Ryan’s proposed shredding of the social safety net that Medicare currently provides.

Ryan, chairman of the House Budget Committee, wants to dismantle the Medicare program and replace it with a system of vouchers. Starting in 2022, the government would give the average 65-year-old Medicare beneficiary $8,000 a year to buy coverage from a private insurer. That’s the amount health care analysts estimate will be what Medicare will spend on every 65-year-old in 2022 if the government doesn’t turn it over to private insurance companies.

While that might sound fair on the surface, it would actually be a very bad deal for people who turn 65 that year, compared to those who turn 65 in 2021. That’s because commercial insurance plans are much more expensive, and operate far less efficiently, than the current Medicare program.
Insurers Spend Less on Medical Care, More on Executive Pay, Marketing

The amount of money commercial plans actually spend to pay medical claims has been declining rapidly over the past several years, while the amount they spend on administrative activities such as marketing and underwriting — and to pay executives and reward shareholders — has been increasing. That’s why Congress included a provision in last year’s health care reform law to require insurance firms to spend no more than 20 percent of their policyholders’ premiums on overhead. By contrast, the current Medicare program spends just 3 percent of its budget on administration.

The nonpartisan Congressional Budget Office (CBO) says the $8,000 voucher won’t be nearly enough for seniors to buy comparable coverage from private insurers and pay the additional out-of-pocket costs that those insurers would require them to pay. The amount the average 65-year-old would have to shell out to buy private insurance in 2022, according to the CBO, will actually be $20,510. Seniors would have to pay the difference — $12,510. If Medicare is not privatized, the difference would be $6,150.
Ryan Plan: Insurers’ Dream Come True

Here’s why this would be a dream-come-true for the insurance industry: The more health plan enrollees have to pay out of their own pockets, the less insurers have to pay for medical care. The money that insurers avoid paying out in claims goes straight to their bottom line — and into shareholders’ pockets.

Insurers have been shifting more and more of the cost of care to their policyholders over the past several years by enticing — or pushing — them into plans with ever increasing deductibles. This trend is part of what Yale professor Jacob S. Hacker called “the personal responsibility crusade” — making people more responsible for the management and financing of the major economic risks they face — in his 2006 book, “The Great Risk Shift.”

This crusade has been led by Republicans and insurance company executives who have been saying for years that the best way to control medical costs is for Americans to have more “skin in the game.” That’s an expression that former Aetna CEO Jack Rowe used often before he retired in 2005, the year he made $22.2 million. It was also a sound bite favored by the CEO I used to work for, CIGNA’s Ed Hanway, before he retired in 2009. Hanway’s total compensation that year was almost $111 million.

The problem is, most Americans have far less skin to put in the game than CEOs like Rowe and Hanway or even Rep. Ryan, who makes $174,000 as a member of Congress. The median household income in the United States was just $49,777 in 2009, which was down $335 from 2008.

That decline, by the way, was the continuation of another trend that began as the Clinton era was ending and the George W. Bush era was beginning. Median household income in the United States peaked in 1999 at $52,388 (adjusted for inflation). It fell more than $2,000 during the eight years of the Bush administration.

During that time, health costs rose dramatically. According to the Kaiser Family Foundation, the average annual health insurance premium for family coverage increased from $5,791 in 1999 to $13,770 in 2010. The average amount that workers contributed out of their own pockets for family coverage increased from $1,543 to $3,997.
Ryan’s Plan Will Throw the Elderly Back into Destitution

With household incomes declining, Americans have had far less money to put into retirement. According to a recent survey conducted by Opinion Research Corp. for America Saves and the American Savings Education Council, less than half of current workers are saving enough to have a “desirable standard of living in retirement.”

If workers are having this much difficulty saving for retirement, where in the world will they find the money to pay what Rep. Ryan would make them pay for Medicare coverage when they turn 65?

Ryan’s “blueprint” is one that will take America back to the pre-1965 days when senior citizens were losing their homes and their farms to pay for medical care. They were becoming destitute — and dying much earlier than they are today — because insurers would not sell them coverage because they were too much of a risk to insure, and there was no safety net for them.

That’s exactly the same place future senior citizens would find themselves if Ryan’s plan to privative Medicare ever becomes public policy.
© 2011 Center for Media & Democracy

Wendell Potter is the Senior Fellow on Health Care for the Center for Media and Democracy in Madison, Wisconsin.

Obama, Berwick, Krugman and others on IPAB

The Independent Payment Advisory Board: A New Approach to Controlling Medicare Spending

By Jack Ebeler, Tricia Neuman and Juliette Cubanski
Kaiser Family Foundation
April 2011

Targets on Medicare Spending Growth Rate

The statute sets target growth rates for Medicare spending. The target is not a “hard cap” on Medicare spending growth, but if spending exceeds these targets, IPAB is required to submit recommendations to reduce Medicare spending by a specified percentage. For 2015 through 2019, the target for Medicare spending per capita is the average of general and medical inflation: specifically, the average of the projected percentage increase in the consumer price index for all Urban Consumers (CPI-U) and the medical care expenditure category of the CPI-U. For 2020 and later years, the target for Medicare spending per capita is the increase in the gross domestic product (GDP) plus one percentage point, which historically has increased at a higher rate than the CPI-based measures.

If projected growth for the implementation year exceeds the target, and the medical care component of the CPI-U exceeds the CPI-U, then IPAB is required to develop and submit a proposal to bring Medicare per capita growth within the target in the implementation year, subject to the applicable limits (maximum savings).

Provisions Affecting Beneficiaries

More broadly, to the extent changes in payments to providers affect beneficiaries’ access to care, such policies have an impact on beneficiaries. This issue is raised by the current physician payment limits and in evidence in Medicaid, where the state provider payment constraints are often severe, and is a potential consequence of any enforced target for Medicare growth, whether through IPAB or other means. If IPAB recommends policies that squeeze Medicare payment rates without equal pressure being placed on private payment rates, there is some concern that Medicare beneficiaries would be at greater risk of having access problems, as providers become more inclined to serve other patients.

http://www.kff.org/medicare/upload/8150.pdf

And…

Fact Sheet: The President’s Framework for Shared Prosperity and Shared Fiscal Responsibility

The White House
April 13, 2011

The President’s framework will strengthen IPAB to act as a backstop to the other Medicare reforms by ensuring that Medicare spending growth does not outpace our ability to pay for it over the long run, while improving the program and keeping Medicare beneficiaries’ premium growth under control. Specifically, it would:

Set a new target of Medicare growth per beneficiary growing with GDP per capita plus 0.5 percent. This is consistent both with the reductions in projected Medicare spending since the Affordable Care Act was passed and the additional reforms the President is proposing.

http://www.whitehouse.gov/the-press-office/2011/04/13/fact-sheet-presidents-framework-shared-prosperity-and-shared-fiscal-resp

And…

Berwick Says Obama’s Plan To Trigger Medicare Cuts Won’t Be Necessary

By Susan Jaffe
Kaiser Health News
April 15, 2011

A day after President Barack Obama proposed strengthening an independent commission to control Medicare’s costs, the program’s administrator said such oversight won’t be necessary because new efforts to reduce waste should slow down spending and even improve the quality of care.

“We don’t have to get to that point,” Medicare chief Donald Berwick told Kaiser Health News Thursday.

http://www.kaiserhealthnews.org/Stories/2011/April/15/Berwick-on-IPAB.aspx

And…

Patients Are Not Consumers

By Paul Krugman
The New York Times
April 21, 2011

About that advisory board (IPAB): We have to do something about health care costs, which means that we have to find a way to start saying no. In particular, given continuing medical innovation, we can’t maintain a system in which Medicare essentially pays for anything a doctor recommends. And that’s especially true when that blank-check approach is combined with a system that gives doctors and hospitals — who aren’t saints — a strong financial incentive to engage in excessive care.

And the point is that choices must be made; one way or another, government spending on health care must be limited.

http://www.nytimes.com/2011/04/22/opinion/22krugman.html

And…

The Other Medicare Cutters

The Wall Street Journal
April 20, 2011

Starting in 2014, the board (IPAB) is charged with holding Medicare spending to certain limits, which at first is a measure of inflation. After 2018, the threshold is the nominal per capita growth of the economy plus one percentage point. Last week Mr. Obama said he wants to lower that to GDP plus half a percentage point.

Post-ObamaCare, Medicare’s administered fee schedule is set eventually to dip below Medicaid payments in many states, which are themselves already far lower than the rates of private insurers that reflect the true costs of health care.

As a practical matter, the more likely outcome is the political rationing of care for the elderly, as now occurs in Britain, or else the board will drive prices so low that many doctors and hospitals drop out of Medicare. Either alternative would create the kind of two-tier system dividing the poor and affluent that Democrats claim is Mr. Ryan’s mortal sin.

http://online.wsj.com/article/SB10001424052748704613504576269582048771132.html

And…

Obama Panel to Curb Medicare Finds Foes in Both Parties

By Robert Pear
The New York Times
April 19, 2011

“But, in its effort to limit the growth of Medicare spending, the board is likely to set inadequate payment rates for health care providers, which could endanger patient care,” (said Representative Pete Stark of California, the senior Democrat on the Ways and Means Subcommittee on Health.)

http://www.nytimes.com/2011/04/20/us/politics/20health.html

And…

Health Reform Assumes its Role as a Punching Bag

By Merrill Goozner
The Fiscal Times
April 20, 2011

The IPAB “can’t order the system transformations that we need like care coordination and a focus on chronic conditions,” said Kenneth Thorpe, a professor of public health at Emory University. “So the only thing they can really do is cut payment rates.”

In other words, the problem isn’t that IPAB has too much power. It’s that it doesn’t have enough.

http://www.thefiscaltimes.com/Blogs/Gooz-News/2011/04/20/Gooz-News-Health-Reform-Assumes-Its-Role-as-a-Punching-Bag.aspx

Comment:

By Don McCanne, MD

Today’s quotes provide tastes of the broad spectrum of political flavors inspired by the establishment of the Independent Payment Advisory Board (IPAB). The fervor of the debate risks obscuring an important point that we have made before and must make ag
ain: Applying a cap on Medicare payments alone at GDP plus one-half or one percent, without placing the same caps on the rest of health care spending, risks devolving Medicare into an underfunded, lower tier welfare program, with impaired access for Medicare beneficiaries because of a lack of willing providers.

As other nations have demonstrated, global budgeting works as long as it is applied to the entire health care delivery system. Instead of merely taking a cleaver to payment rates, as IPAB would, attention in a single payer system is directed to improving productivity, expanding efficiencies, and reducing administrative and clinical waste, all within the constraints of a universal global budget. For those who would dismiss this because it is rationing, keep in mind that this form of rationing actually improves value in our health care purchasing. Maybe “beneficial rationing” should become a byword for reform.

If you wish to learn more about IPAB, the 24 page Kaiser Family Foundation report (first link above) is an excellent resource. The following quote from this report reemphasizes the primary lesson of today’s message: “If IPAB recommends policies that squeeze Medicare payment rates without equal pressure being placed on private payment rates, there is some concern that Medicare beneficiaries would be at greater risk of having access problems, as providers become more inclined to serve other patients.”

Obama, Berwick, Krugman and others on IPAB

The Independent Payment Advisory Board: A New Approach to Controlling Medicare Spending

By Jack Ebeler, Tricia Neuman and Juliette Cubanski
Kaiser Family Foundation
April 2011

Targets on Medicare Spending Growth Rate

The statute sets target growth rates for Medicare spending. The target is not a “hard cap” on Medicare spending growth, but if spending exceeds these targets, IPAB is required to submit recommendations to reduce Medicare spending by a specified percentage. For 2015 through 2019, the target for Medicare spending per capita is the average of general and medical inflation: specifically, the average of the projected percentage increase in the consumer price index for all Urban Consumers (CPI-U) and the medical care expenditure category of the CPI-U. For 2020 and later years, the target for Medicare spending per capita is the increase in the gross domestic product (GDP) plus one percentage point, which historically has increased at a higher rate than the CPI-based measures.

If projected growth for the implementation year exceeds the target, and the medical care component of the CPI-U exceeds the CPI-U, then IPAB is required to develop and submit a proposal to bring Medicare per capita growth within the target in the implementation year, subject to the applicable limits (maximum savings).

Provisions Affecting Beneficiaries

More broadly, to the extent changes in payments to providers affect beneficiaries’ access to care, such policies have an impact on beneficiaries. This issue is raised by the current physician payment limits and in evidence in Medicaid, where the state provider payment constraints are often severe, and is a potential consequence of any enforced target for Medicare growth, whether through IPAB or other means. If IPAB recommends policies that squeeze Medicare payment rates without equal pressure being placed on private payment rates, there is some concern that Medicare beneficiaries would be at greater risk of having access problems, as providers become more inclined to serve other patients.

http://www.kff.org/medicare/upload/8150.pdf

And…

Fact Sheet: The President’s Framework for Shared Prosperity and Shared Fiscal Responsibility

The White House
April 13, 2011

The President’s framework will strengthen IPAB to act as a backstop to the other Medicare reforms by ensuring that Medicare spending growth does not outpace our ability to pay for it over the long run, while improving the program and keeping Medicare beneficiaries’ premium growth under control. Specifically, it would:

Set a new target of Medicare growth per beneficiary growing with GDP per capita plus 0.5 percent. This is consistent both with the reductions in projected Medicare spending since the Affordable Care Act was passed and the additional reforms the President is proposing.

http://www.whitehouse.gov/the-press-office/2011/04/13/fact-sheet-presidents-framework-shared-prosperity-and-shared-fiscal-resp

And…

Berwick Says Obama’s Plan To Trigger Medicare Cuts Won’t Be Necessary

By Susan Jaffe
Kaiser Health News
April 15, 2011

A day after President Barack Obama proposed strengthening an independent commission to control Medicare’s costs, the program’s administrator said such oversight won’t be necessary because new efforts to reduce waste should slow down spending and even improve the quality of care.

“We don’t have to get to that point,” Medicare chief Donald Berwick told Kaiser Health News Thursday.

http://www.kaiserhealthnews.org/Stories/2011/April/15/Berwick-on-IPAB.aspx

And…

Patients Are Not Consumers

By Paul Krugman
The New York Times
April 21, 2011

About that advisory board (IPAB): We have to do something about health care costs, which means that we have to find a way to start saying no. In particular, given continuing medical innovation, we can’t maintain a system in which Medicare essentially pays for anything a doctor recommends. And that’s especially true when that blank-check approach is combined with a system that gives doctors and hospitals — who aren’t saints — a strong financial incentive to engage in excessive care.

And the point is that choices must be made; one way or another, government spending on health care must be limited.

http://www.nytimes.com/2011/04/22/opinion/22krugman.html

And…

The Other Medicare Cutters

The Wall Street Journal
April 20, 2011

Starting in 2014, the board (IPAB) is charged with holding Medicare spending to certain limits, which at first is a measure of inflation. After 2018, the threshold is the nominal per capita growth of the economy plus one percentage point. Last week Mr. Obama said he wants to lower that to GDP plus half a percentage point.

Post-ObamaCare, Medicare’s administered fee schedule is set eventually to dip below Medicaid payments in many states, which are themselves already far lower than the rates of private insurers that reflect the true costs of health care.

As a practical matter, the more likely outcome is the political rationing of care for the elderly, as now occurs in Britain, or else the board will drive prices so low that many doctors and hospitals drop out of Medicare. Either alternative would create the kind of two-tier system dividing the poor and affluent that Democrats claim is Mr. Ryan’s mortal sin.

http://online.wsj.com/article/SB10001424052748704613504576269582048771132.html

And…

Obama Panel to Curb Medicare Finds Foes in Both Parties

By Robert Pear
The New York Times
April 19, 2011

“But, in its effort to limit the growth of Medicare spending, the board is likely to set inadequate payment rates for health care providers, which could endanger patient care,” (said Representative Pete Stark of California, the senior Democrat on the Ways and Means Subcommittee on Health.)

http://www.nytimes.com/2011/04/20/us/politics/20health.html

And…

Health Reform Assumes its Role as a Punching Bag

By Merrill Goozner
The Fiscal Times
April 20, 2011

The IPAB “can’t order the system transformations that we need like care coordination and a focus on chronic conditions,” said Kenneth Thorpe, a professor of public health at Emory University. “So the only thing they can really do is cut payment rates.”

In other words, the problem isn’t that IPAB has too much power. It’s that it doesn’t have enough.

http://www.thefiscaltimes.com/Blogs/Gooz-News/2011/04/20/Gooz-News-Health-Reform-Assumes-Its-Role-as-a-Punching-Bag.aspx

Today’s quotes provide tastes of the broad spectrum of political flavors inspired by the establishment of the Independent Payment Advisory Board (IPAB). The fervor of the debate risks obscuring an important point that we have made before and must make again: Applying a cap on Medicare payments alone at GDP plus one-half or one percent, without placing the same caps on the rest of health care spending, risks devolving Medicare into an underfunded, lower tier welfare program, with impaired access for Medicare beneficiaries because of a lack of willing providers.

As other nations have demonstrated, global budgeting works as long as it is applied to the entire health care delivery system. Instead of merely taking a cleaver to payment rates, as IPAB would, attention in a single payer system is directed to improving productivity, expanding efficiencies, and reducing administrative and clinical waste, all within the constraints of a universal global budget. For those who would dismiss this because it is rationing, keep in mind that this form of rationing actually improves value in our health care purchasing. Maybe “beneficial rationing” should become a byword for reform.

If you wish to learn more about IPAB, the 24 page Kaiser Family Foundation report (first link above) is an excellent resource. The following quote from this report reemphasizes the primary lesson of today’s message: “If IPAB recommends policies that squeeze Medicare payment rates without equal pressure being placed on private payment rates, there is some concern that Medicare beneficiaries would be at greater risk of having access problems, as providers become more inclined to serve other patients.”

S&P's David Blitzer on single payer

Check-Up on U.S. Healthcare

Squawk on the Street, CNBC
April 21, 2011

Mark Haines: S&P’s latest health care costs report from February 2010 through February of this year shows health care costs rose 6.2%. That’s good in a sense that it’s down slightly from 6.3% in the previous 12-month period, but obviously way above the rate of inflation for everything else. Here first on CNBC, David Blitzer, chairman of the S&P 500 index committee. David, good morning. Thanks for being with us.

David Blitzer: Good morning, Mark. How are you?

Haines: Pretty good. What do you have for us?

Blitzer: Health care costs continue to rise, however the rate of increase continues to creep down a little bit. So the news isn’t good, but it’s not getting worse. It’s getting maybe a touch better.

Haines: Why are these costs escalating at – I don’t know – three or four times the rate of overall inflation? What’s going on here?

Blitzer: Health care – despite all the excitement about technology and drugs – health care is a very labor intensive activity, and people – labor – costs a lot of money, which seems to be the key factor driving it up.

Haines: So, if I may, logically then you would find the worst or the most inflation occurring in hospitals.

Blitzer: You would, and, indeed, on the commercial side you do. On the Medicare side, you don’t, and I think that brings up a different aspect. Over the last few years we have heard a lot of arguments about single payer plans versus other kinds of plans. Single payer means Uncle Sam pays for all the health care. We pay him.

Haines: Right.

Blitzer: Medicare for people over 65 is a single payer plan, and, indeed, we consistently see smaller rates of increase in Medicare items than we do in commercial insurance, the kind of insurance that employers provide for their employees.

Haines: Okay. I’m going to leave that lying there because some of our viewers right now are going apoplectic thinking you have just endorsed single payer health care.

Blitzer: I haven’t. I’ve only reported the numbers. I’m not endorsing anything.

Haines: Believe me, I understand. You’re quoting the facts. Some people think facts are partisan. I don’t know how they get there, but they do. David, thank you very much. Appreciate your input.

Blitzer: Thank you. Have a good day.

Video:
http://video.cnbc.com/gallery/?video=3000017902

Comment: 

By Don McCanne, MD

Facts are not partisan. Standard and Poor’s David Blitzer reports only the facts on single payer – and Wall Street needs to hear them.

S&P’s David Blitzer on single payer

Check-Up on U.S. Healthcare

Squawk on the Street, CNBC
April 21, 2011

Mark Haines: S&P’s latest health care costs report from February 2010 through February of this year shows health care costs rose 6.2%. That’s good in a sense that it’s down slightly from 6.3% in the previous 12-month period, but obviously way above the rate of inflation for everything else. Here first on CNBC, David Blitzer, chairman of the S&P 500 index committee. David, good morning. Thanks for being with us.

David Blitzer: Good morning, Mark. How are you?

Haines: Pretty good. What do you have for us?

Blitzer: Health care costs continue to rise, however the rate of increase continues to creep down a little bit. So the news isn’t good, but it’s not getting worse. It’s getting maybe a touch better.

Haines: Why are these costs escalating at – I don’t know – three or four times the rate of overall inflation? What’s going on here?

Blitzer: Health care – despite all the excitement about technology and drugs – health care is a very labor intensive activity, and people – labor – costs a lot of money, which seems to be the key factor driving it up.

Haines: So, if I may, logically then you would find the worst or the most inflation occurring in hospitals.

Blitzer: You would, and, indeed, on the commercial side you do. On the Medicare side, you don’t, and I think that brings up a different aspect. Over the last few years we have heard a lot of arguments about single payer plans versus other kinds of plans. Single payer means Uncle Sam pays for all the health care. We pay him.

Haines: Right.

Blitzer: Medicare for people over 65 is a single payer plan, and, indeed, we consistently see smaller rates of increase in Medicare items than we do in commercial insurance, the kind of insurance that employers provide for their employees.

Haines: Okay. I’m going to leave that lying there because some of our viewers right now are going apoplectic thinking you have just endorsed single payer health care.

Blitzer: I haven’t. I’ve only reported the numbers. I’m not endorsing anything.

Haines: Believe me, I understand. You’re quoting the facts. Some people think facts are partisan. I don’t know how they get there, but they do. David, thank you very much. Appreciate your input.

Blitzer: Thank you. Have a good day.

Video:
http://video.cnbc.com/gallery/?video=3000017902

Facts are not partisan. Standard and Poor’s David Blitzer reports only the facts on single payer – and Wall Street needs to hear them.

Medical bankruptcies will remain high under Obama health plan

By Glen Ford
Black Agenda Radio, March 21, 2011

The Obama administration’s health care legislation will not prevent Americans from going bankrupt in large numbers due to illness, says Dr. David Himmelstein, an author of a study of the “almost identical” Massachusetts health care program implemented in 2005. “People got insurance but, basically, they got such lousy insurance that they ended up bankrupt if they got sick,” said Himmelstein. “For states like Texas, Louisiana and California,” which have far worse health coverage than Massachusetts, “we’re not going to see much improvement” under the Obama plan. A transcript of the interview follows.

A new study shows that people in Massachusetts are still going bankrupt in huge numbers because of medical expenses, five years after implementation of a health care plan that is remarkably similar to President Obama’s health package. Like Obama’s bill, the Massachusetts plan compels residents to buy private health insurance. Dr. David Himmelstein is one of the authors of this study.

David Himmelstein: What we found is that medical bankruptcies haven’t really decreased in Massachusetts, even with our state’s reform. Basically, people got insurance, but they got such lousy insurance that they ended up bankrupt if they got sick – again, even though they had insurance. They were left with giant co-payments and deductibles and things that weren’t covered and the insurance turned out to be like an umbrella that leaks in the rain: it’s not there when you need it.

Glen Ford: So who is it that is helping if there has been little change? And, in fact, in raw numbers there was an increase in bankruptcies.

Himmelstein: That’s right. Probably it’s helping some doctors and some hospitals that are getting paid a little bit more, but it doesn’t look like most patients are actually getting very much help. Maybe some are getting a little bit around the edges if you’re not seriously ill and not getting huge bills that would drive you into bankruptcy, maybe there’s a little bit of help there. But we couldn’t find very much help for patients at all.

Ford: How much does the Massachusetts plan, in these kinds of effects, resemble President Obama’s plan?

Himmelstein: It’s almost identical. I mean, the coverage that people got in Massachusetts is, if anything, a little better than what the national reform says that people have to have. So, just to give you an example, coverage that is most commonly bought through these insurance exchanges here, for someone my age, would cost about $5,600 a year — for the coverage you have to buy. It doesn’t cover any of the first $2,000-worth of bills, so that all comes out of your pocket. And, even after that, you pay another $4,000 in co-payments. So, the coverage is really pretty poor, and it’s pretty much what Washington has coming to the rest of the country.

Ford: And yet, a big part of Obama’s campaign was that it was intolerable that people would go bankrupt on top of the personal catastrophe of illness.

Himmelstein: Well, it made good sound bites, only the legislation they actually passed didn’t actually address the problem. What we really need is full coverage for every American. Every Canadian has first-dollar, full coverage and their health care system cost less than ours and they don’t have much medical bankruptcy — that’s been looked at and they have like 10 percent as much medical bankruptcy as we do. Once in a while someone has something where they are basically out of work, and because of that, an illness drives them into bankruptcy, but the medical bills are not a problem under real national health insurance. We didn’t get real national health insurance.

Ford: And polls show that that’s what people were actually expecting, what they were led to believe was going to be in the hopper. Was this kind of bait and switch?

Himmelstein: I think it was and frankly, it’s what the Republicans are saying we got and we shouldn’t have. In a way, we have the worst of both worlds — we didn’t get really good coverage, and yet the Republicans are claiming that it’s socialized medicine.

Ford: And that, I remember, was one of the great fears. Not only would this bill, this national bill be inadequate to the problem, but that it might create a problem itself forestalling real Medicare for all type coverage.

Himmelstein: That’s what we worry about frankly because there was momentum building for real change, for a Medicare-for-all kind of program, and at this point, some of the steam has been taken out of it. But, frankly we think that the American people are going to discover soon that what they got is not real coverage.

Ford: And now we see that the president is going to let some states opt out of his plan entirely.

Himmelstein: Well, they are already letting states weaken the first parts of the bill. They’re saying, the bill said that insurance companies can’t sell really bare-bones policies, I mean worse than we have in Massachusetts, and get away with it, and the administration has waived that requirement wherever they’ve been asked. So, at McDonald’s and those kinds of places they offer their workers coverage that’s like $3,000. That’s how much might be covered out of a $100,000 illness. And the Obama administration has said, “That’s OK,”’ even though the law says it’s not. So, they’re already waiving some of the better provisions in the law. And, we’re worried they are going to waive more. On the other side, we’d like to see flexibility for states to do better and folks in Vermont are talking about doing a Medicare-for-all kind of plan in Vermont.

Ford: And let’s make it clear, Massachusetts has never been at the bottom of the list or anywhere near it in terms of health care.

Himmelstein: Oh, far from it. Even before our health reform, Massachusetts was one of the better places in the country to be sick. We had relatively few uninsured and we actually had a little bit lower medical bankruptcy rate than the rest of the country, to begin with. We just didn’t improve it with this reform.

Ford: So what does this mean for states that have historically provided poorer health care?

Himmelstein: Well, I think it’s a warning sign that we haven’t really done much for people in those states. If you look at places like Texas, Louisiana and California, which have huge numbers of uninsured and tremendous numbers of medical bankruptcies, we’re not going to see much improvement there.

That was Dr. David Himmelstein. [Dr. Himmelstein is professor of public health at the City University of New York and co-founder of Physicians for a National Health Program.]

Black Agenda Radio is heard on the Progressive Radio Network, with Glen Ford, editor of Black Agenda Report, and Nellie Bailey.

http://blackagendareport.com/content/black-agenda-radio-progressive-radio-network-glen-ford-and-nellie-bailey-%E2%80%93-week-march-21-201

St. Paul City Council supports single-payer health care in state

By Joe Kimball
MinnPost.com, April 21, 2011

The St. Paul City Council passed a resolution Wednesday supporting the Minnesota Health Plan, a proposal that’s floating around the Legislature (but not yet close to passing) for single-payer, universal health care in the state.

The Minneapolis and Duluth city councils previously have voted to support the plan, too.

The St. Paul council will now urge its local legislators to support the plan, which purports to make “health care guaranteed and affordable for every Minnesotan.”

The “Whereas” clauses in the council resolution note:

    * At some point in 2009 approximately 14 percent of St. Paul residents were without health insurance
    * Approximately 71 percent of those without health insurance statewide are employed
    * The Minnesota Health Plan would lower the cost of health care through a single-payer system for all Minnesota residents
    * Lower premiums as a result of the Minnesota Health Plan would have a positive effect on the city’s budget
    * The Minnesota Health Plan would reduce the need for unnecessary emergency room visits, thus reducing the related costs and relieving area hospitals of a burden that threatens solvency.

The Minnesota Universal Health Care Coalition, applauded the vote, noting: “It is time to break the link of health insurance to employment. It no longer works in a society and time where people change jobs frequently and work one or more part-time jobs. When health insurance is linked to employment, people often lose health insurance for themselves (and their families) when they need it most — when they are ill and unable to work.”

http://www.minnpost.com/politicalagenda/2011/04/21/27685/st_paul_city_council_supports_single-payer_health_care_in_state

A call to lead in reducing inequalities

By Jeffrey B. Ritterman, M.D.
Editorial, American Journal of Medicine, April 2011
 
Imagine a microbe that lowers life expectancy. Suppose this microbe also causes increases in obesity, drug use, teen pregnancy, incarceration rates, and homicide rates, and a breakdown of social cohesion.
 
We would expect pharmaceutical companies and the Centers for Disease Control to engage in a no-holds-barred campaign to develop an antibiotic or a vaccine to do away with the threat and protect public health.
 
The threat is here. It is real and it is causing untold harm. But the threat is not a microbe. It is us, or more accurately, how we organize our social environment.
 
The United States is now the most unequal of the rich developed countries in terms of income and wealth. There are now hundreds of papers and an excellent book, “The Spirit Level: Why Greater Equality Makes Societies Stronger,” by Richard Wilkinson and Kate Pickett (1), which document the health and social costs of rising income inequality. Yet mainstream medicine seems to have hardly taken notice.
 
Wilkinson and Pickett document a long list of health concerns and social ills that correlate with increases in income inequality. We don’t live as long as our peers in more equal countries, nor do our infants. We’re fatter, more of our teens get pregnant, we incarcerate more of our citizens, our children score worse on math and science tests, we kill one another more often, and we trust one another less. We even recycle less often.
 
Correlation, however, does not prove causality. Wilkinson and Pickett address this question at some length. They analyze the data on civic trust and conclude that the overwhelming balance of the evidence supports causality. It appears to be the case that the increasing income disparity causes us to trust one another less. The breakdown in trust causes the social fabric to unravel and we begin to experience life as a Hobbesian struggle of all against all. This results in disease in the individual and dysfunction in our society.
 
Why is this so important? Recently, Professor Emmanuel Saez has looked at income tax data dating back to World War I. (2) What he found is amazing and startling: we are more unequal now than at any time in our history, and significantly so. The last time we were this unequal, the stock market crashed and ushered in The Great Depression.
 
What has this to do with medicine and health? A generation ago, Sir Michael Marmot and colleagues (3) showed convincingly that social class was a far more important determinant of health outcome than cholesterol level, blood pressure, diet, and smoking behavior combined. The message was clear. The social environment is the major determinant of health outcome.
 
In the office, we can help one patient at a time. This is worthwhile and important. I have spent my life doing so. But now it is clear that social policies that promote a more equal sharing of the social product greatly improve population health and the social environment. Physicians can help lead society to a more equitable and healthier future by advocating and working toward a fairer distribution of wealth and income.
 
In Virchow’s day, the great physician advocated for social reforms as the best way to fight a typhus epidemic. Virchow, the founder of Social Medicine, claimed that “physicians are the natural attorneys of the poor, and the social problems should largely be solved by them.”(4) Similarly, in our day, Sir Michael Marmot has called on physicians to lead “the charge for action across a broad front to reduce inequalities in health.”(5) Will you join me in this noble cause?
 
Jeffrey B. Ritterman, M.D., retired from the Department of Cardiology, Kaiser Permanente in Richmond, Calif., in November 2010.
 
References
 
1. Wilkinson R, Pickett K. The Spirit Level: Why Greater Equality Makes Societies Stronger. New York: Bloomsbury Press; 2009.
2. Saez E. Striking it Richer: The Evolution of Top Incomes in the United States (Updated with 2007 estimates) August 5, 2009. Available at: http:// econ.berkeley.edu/~saez/saez-UStopincomes-2007.pdf. Accessed February 11, 2011.
3. Rose G, Marmot M. Social class and coronary heart disease. Br Heart J. 1981;45(1):13-19.
4. Wikipedia. Rudolf Virchow. Available at: http://en.wikipedia.org/wiki/ Rudolf_Virchow. Accessed February 11, 2011.
5. Marmot M. Status syndrome: a challenge to medicine. JAMA. 2006; 295:1304-1307.
 
doi:10.1016/j.amjmed.2010.11.021
 
http://download.journals.elsevierhealth.com/pdfs/journals/0002-9343/PIIS0002934311000039.pdf