Dr Lego Diagnoses Health Care

[Welcome Industry Radar readers!]

Mike passes this along:

Still want a government-run health care plan?

That Dirty, Dirty MVNHS©

Bill's chronicled the "sanitation problems" of Brits' hospital facilities before, but we like to keep our readers up-to-date on that system's chronic problem with filth.

Seems that Tereza Tosbell, a seasoned housekeeper herself, found herself "in hospital" recently:

"The sick 48-year-old was so disgusted at the conditions after three days on a 'filthy' ward that she grabbed the antibacterial fluid dispenser at the end of her bed and some hand towels from the bathroom."

Well, we've certainly banged the "personal responsibility" drum quite often here at IB, but we never quite thought that it should extend to cleaning one's own hospital room. One would think that, after cleaning for over an hour, the staff might at least offer to lend a hand.

One would be wrong:

"The nurses and other staff saw what I was doing but just left me to get on with it."

Certainly, though, this was but an isolated incident, right?

Nope:

"The Patients' Association yesterday said what Miss Tosbell had experienced was 'nothing unusual'."

What may be even scarier, at least for the patients, is that, in a recent review, this hospital "scored maximum marks for safety and cleanliness."

Quick, let's have a nationalized system here!

That, and government-provided Swiffers all around.

Happy Birthday, America!

A very Happy Independence Day to all of our readers and their families.

The (Tea) Party's Over

There's a classic scene in TV's "Happy Days" in which The Fonz, wearing his trademark leather jacket, water skies over a shark, thus giving birth to the term "jumping the shark." It's come to mean a pivotal event which goes too far, thus destroying its own credibility.

This evening, I witnessed the Tea Party movement leap mightily over that sea creature.

At April's event, I was impressed with the enthusiasm and optimism of those attending, and found most of the speakers informative and inspiring. Perhaps it was the fact that we were all gathered in a relatively small space in downtown Dayton, almost all standing through the entire 2+ hour celebration of American values.

That Tea Party started (roughly) on time, and was over at a reasonable hour. There was a chemistry among those of us present, and the folks in charge seemed to understand that this was a key moment, when the nascent movement would begin to pick up steam and reach out to a broad range of fellow Americans.

Tonight's, by contrast, showed nothing but contempt for its own supporters, and destroyed any hope of a broader outreach to Democrats and Independents who may have begun to feel betrayed by the direction this Administration, and its enablers in Congress, are taking us.

Instead of choosing (again) a central location, the promoters booked the event at a very nice park some 20 miles or so from Dayton. Worse, they held off starting for a full half hour, effectively telling those of us who'd made the effort to be punctual that our time was worthless, certainly not as important as all the folks still driving in. At one point, I spoke directly with one of the organizers (whom I know slightly), and told him that the clear message that they were sending was that we weren't important. He thanked me for my input, but it was still another 15 minutes before the program got under way.

This is inexcusable; it says that the most ardent supporters are simply unimportant.

The venue itself was another problem: unlike the packed downtown location, this was a park complete with ice cream and soft pretzel vendors; folks spread out, many on blankets and stadium chairs, for an evening of entertainment, not enlightenment or inspiration.

There was no chemistry, no sense of urgency. It was simply a very pleasant evening in the park, with music and the occasional speaker.

And then, in what can only be described as one of the most stupendously ill-advised and movement-killing decisions I've ever witnessed, they brought on an Obama impersonator, who proceeded to make a complete fool of both himself and the organizers. If there had been any hope of reaching out to those on the left, indeed, to anyone with any respect for fellow citizens, this killed it.

It's a shame, really: "what could have been."

Needless to say, if there actually is a third Tea Party, I won't be attending. Nor, I daresay, will very many others. The right (often correctly) accuses the left of stifling bi-partisanship: Pot, meet (tea) kettle.

Public Plan or Bust

All protestations to the contrary, it certainly appears that our political class is dead-set on making the Public Plan the only plan.

Hunh?

Well, the most widely-supported proposal currently making the rounds requires employers to pay almost three quarters of each employees' premium, or face substantial penalties. We've already seen the effect that a 65%, temporary subsidy has had on the group market; one can only guess at the consequence of a larger, permanent one.

Our best guess: employers will quickly drop their group plans altogether, leaving millions of previously privately insured folks to hop onto the new Public Plans. As Bob notes, a similar program in Massachusetts has led to major shortages and cost overruns, while doing nothing to address the underlying problem of escalating health care costs.

Regardless, the plan makes it a "no brainer" for medium and large businesses to delete their group insurance plans:

"Businesses that don’t provide that minimum level of coverage would be required to pay the federal government a fee based on 8 percent of their payroll. Small businesses under a yet-to-be-determined threshold would be exempted from that “play or pay” requirement."

Eight percent? What percentage of payroll is taken up by insurance premiums now? At least 8%, I daresay. Again, the Public Plan becomes the only economically viable alternative for these employers.

As for "small businesses," who knows? My guess is that they'll take a page from their "big brother" counterparts and send their employees to the Public trough, as well. Why even hassle with the group plan, when it's likely that that exemption will be fleeting anyway?

Still doubt that the Public Plan is the endgame? Maybe this will change your mind:

"Americans who refuse to buy affordable medical coverage could be hit with fines of more than $1,000 under a health care overhaul bill unveiled Thursday."

Of course, no one's yet defined "affordable," but that kind of thinking has no place in the hallowed halls of the legislature. A thousand dollar hit is roughly $83 a month, a nice chunk towards paying for that "affordable" health insurance policy. So, faced with that kind of hit, how many folks will say "okay, I get it, I'm on board with the Public Plan."

Thought so.

The pro-national-health-plan folks would also have us believe that this Public Plan would have significantly lower admin costs, modeled as it is after Medicare. They claim that Medicare admin costs are a paltry 3%, compared to upwards of 20% for insurers.

But are these numbers accurate?

According to Tom Bevan at Real Clear Politics, the answer is a resounding (and provable) "no!" He took a look behind the figures, and found some disquieting information:

"The statistic cited by [its claimants] uses administrative costs calculated as a percentage of total health care costs (For Medicare it's roughly 3 percent and for private insurers it's roughly 12 percent)." [emphasis in original]

Because Medicare is geared toward an elderly demographic, with correspondingly large claims costs, "it generates significantly higher expenditures than private insurance plans, thus making administrative costs smaller as a percentage of total costs. This creates the appearance that Medicare is a model of administrative efficiency. What [its claimants see] as a "miracle" is really just a statistical sleight of hand."

Ooops.

Mr Bevan also points out that a substantial percentage of private insurer's overhead can be laid directly at the feet of state premium taxes. Absent those, the numbers become less differentiated.

But it gets worse:

"(W)hen you compare administrative costs on a per-person basis, Medicare is dramatically less efficient than private insurance plans." He even links to a Heritage Foundation study comparing admin costs for both MC and insurers, which demonstrates that these costs are almost 50% higher for MC than private insurers.

That sound you hear is the hissing of "gummint is more efficient than the private sector" balloons as they rapidly deflate.

Oy Canada: Doc's Bailing, NICU's Missing

Even as we rush towards a similar model, it may be instructive to see how well nationalized health care's actually working out for our Neighbors to the North©. While in Chicago earlier this week (for our daughter's college orientation), my wife and I overheard a Quebecois gentleman, in the Windy City on business, telling his associates about health care, Canadian style. I was able to take some notes, which I'll share with you.

When asked about Canadian health care, he responded "when you can get it, it's pretty good." He went on to say that "if you can afford it, the best doctors are available." I didn't quite understand this at the time, since Canadian health care is, after all, "free." As you'll see in a moment, this isn't really true.

He followed up by observing that you "take what you get;" again leaving me puzzled: haven't we been told, ad nauseum, that health care is readily available Up North? And again, I later learned the bitter truth.

In his very next breath, he admitted that "care in Canada is not as good as what you get in the US." I should point out that he said he was from a city "100 kilometers from Quebec."

So what, exactly, is the truth here? Is he simply a dissatisfied Canuck, or does his opinion reflect reality?

You be the judge.

Is quality health care truly available in Canada? Well, it depends on where in Canada you live. The gummint-run health system is administered at the provincial level (as ours is regulated, for the most part, at the state level), so quality and accessibility of care can vary greatly. While critics of our system point to Canada as a role model, perhaps the tragedy of little Ava Stinson can serve as a useful rebuttal:

"A critically-ill premature-born baby from Hamilton is all alone in a Buffalo, N.Y., hospital after she was turned away for treatment at local facility and transferred across the border without her parents, who don’t have passports."

Turns out, there were no (as in: zero, nada, zilch) Neonatal Intensive Care Units available in the whole of Quebec.

Not. A. One.

So of course, they headed south (as have so many others before them), in order to save their baby's life. Thankfully, medics at Buffalo's (mmm, wings!) St. Joseph's Hospital will apparently be able to help, thanks to American medical technology and care. In fact, a (very) quick Google search revealed four NICU facilities in Buffalo alone.

Would it be presumptuous to ask the national health care proponents why they hate Canadians?

But certainly good quality care is available to all?

Not so much:

"Private for-profit clinics are a booming business in Canada ... Facing long waits and substandard care, private clinics are proving that Canadians are willing to pay for treatment."

As we've repeatedly pointed out, one of the problems with our own national health care system, aka Medicare, is that there are a lot of doc's who shun MC patients, and the concomitant reduced reimbursement rates. Looks like that particular virus has spread North; more and more Canadian physicians are opting out of the government-run system and (back?) into private pay, private practice. That was apparently what our Quebecois businessman meant.

Does this all sound familiar?

It should: the Canadian government does, indeed, spend less on health care for its citizens, proving the old adage about getting what one pays for.

Carnival of Personal Finance, Grand Rounds and Cavalcade of Risk are up...

This week's Carnival of Personal Finance is online at Green Panda Treehouse.

Grand Rounds is up at edwinleap.com.

And the Cavacade of Risk #81 is at The Disease Management Care Blog.

Happy reading!

Sold Out Seniors

AARP's underhanded tactics are not news to regular readers of IB, but this takes the cake:

"Friday ... the AARP sent a memo to Senate officials threatening to yank support for the chamber's health committee's version of reform if it didn't get what it wanted on another provision in the bill related to biogeneric drugs ...

I cannot recommend a letter of support or a major grass-roots effort in support [of the health care reform bill]. Indeed, people will probably have to be critical, particularly about that provision. I hope you won't force us to do that on such an important bill that I know you all have worked so hard on."

"Gee, that's a nice store ya got there, pal, be a shame if anything happened to it."

Of course, this is merely politics as usual in DC, but it's fascinating (albeit disappointing) to see what's supposed to be the advocacy group for seniors making such (un)veiled threats. At stake, of course, is AARP's reputation as king-maker, able to wield its powerful sword (tens of millions of seniors' votes) to get its way, even at the cost of the very lives of those they ostensibly represent.

Think that's a tad dramatic?

No, it isn't:

"[O]lder people will be left vulnerable to discrimination and could miss out on life-saving treatment in favour of younger patients."

That's the view of the British health care system (known here as the MVNHS©). And it's definitely the view of The One:

"President Obama suggested at a town hall event Wednesday night that one way to shave medical costs is to stop expensive and ultimately futile procedures performed on people who are about to die and don't stand to gain from the extra care."

And in case it's not obvious to the casual observer, his very next statement concerned his grandmother. This ain't rocket surgery: he's explicitly proposing to limit care to the elderly.

One would think that might have caught AARP's attention, but it's apparently a lot more interested in scoring political points than saving the lives of its constituency.

Of course, one would be wrong.

The Medicare Tomato Market (and lessons for today)

[Promoted from the comments section - Thanks to Andrew Garland]

Regular commenter Andrew Garland tips us to this fantastic post from fellow med-blogger The Happy Hospitalist. It's a bit lengthy, so I'll only excerpt some key points, but please do yourself a favor and Read the WholeThing©:

"Imagine for the moment that you have been taken out of reality and into the alternate bizarro world of the Medicare Tomato. In this analogy, the Medicare Tomato represents a day in the life of a practicing physician...

Enter the massive government take over. A massive coup on the tomato market. By a midnight Congressional mandate, the destruction of the free market exchange of money for tomatoes was replaced and regulated by the Medicare National Tomato Bank (MNTB) ...

Immediately after removing free market principles from the tomato market, the MNTB instituted the principles of most resistance. If something can be regulated, it will be. The word quickly spread through out this great nation of ours that the government would now make tomatoes a right for everyone ...

[ed: that sounds familiar]

In their brilliant strike of genius, they decided to try something that had never been tried before in the world of capitalism. They would reign in the cost to the MNTB, not by cutting the demand (political suicide), but by instead instituting a policy of 80% payment of market prices ...

The first response exacerbated the problem. Since the super duper technology tomatoes were paid at a higher rate, more and more grocers stopped offering cheap tomatoes. They simply removed the variety of product. They removed their rings of service. One product fits all ...

The cheap primary tomato market was killed off."

Now, dear reader, try substituting the term "tomato" with "health care" and the picture becomes crystal clear.

And quite frightening.

Cavalcade of Risk #81: Call for Submissions

Jaan Sidorov hosts next week's Cavalcade of Risk. Submissions are due by Monday (June 29), and should include:

■ Your blog's url
■ Your post's url
■ The post's trackback URL (if available)
■ A (brief) summary of the post

And PLEASE remember: ONLY posts that relate to risk (not personal finance tips and the like).

You can submit your post via Blog Carnival or email.

HSA Update: Early Summer Edition

Regular readers know that we're big HSA (Health Savings Account) fans here, so it's nice to see that they continue to gain traction. According to the latest from the Association of Health Insurance Plans (AHIP), this is indeed the case:

"An annual census by ... AHIP ... shows that the number of people covered by health savings accounts/high-deductible health plans (HSA/HDHPs) totaled 8.0 million in January 2009."

That's an increase of over 200% in two years. Interestingly, the fastest growing segment seems to be the large group market, up about 35%. I don't do much in that arena; my doctor says I don't get enough stress, and recommended that I concentrate on the small group and individual markets to fix that.

Speaking of the individual market, AHIP's survey found that over half of those folks covered by an HSA plan were over age 40. Once again, we put the lie to the "only the young and healthy buy into HSA's" canard.

There's a lot more in the study, but it's clear that these plans have become "mainstreamed" in the market, and have become much more acceptable in all segments. Although I'm not holding my breath, I think that these kinds of plans, which require more individual commitment and responsibility to health care, could make a valuable contribution to health care reform efforts.

And speaking of HSA's, the new contribution limits for 2010 are in:

The max contribution limit for individual HSAs goes to $3,050 (up $50 from this year); for families, the new max is set at $6,150 (an increase of $200 from '09 levels).

Next year's minimum deductible will be $1,200 for individuals, and $2,400 for families, an increase of $50 for the former and $100 for the latter.

And, finally, the 2010 max OOP (out of pocket) for individuals increases by $150, to $5,950; for families, the max will be $11,900 (up $300).

Something about those numbers seemed "off" to me, so I broke out the ol' Excel and plugged them in. The maximum contribution amounts for 2010 increased 1.6% for individuals, and 3.25% for families. But the annual potential exposure (out of pocket maximum) increased about 2.5% for both individuals and families. This seems unfair to folks with single coverage, since they're going to be playing an impossible game of "catch up."

Just my $.02 (up 3.76% from last year!)

RIP, Angel Jill Munroe

[Welcome Industry Radar readers!]

For those of us of a certain age, Farrah's hair and swimsuit set a certain tone (maybe even expectation). To us, she'll always be Charlie's First Angel.

Fly, Jill.

Health Wonk Review, Late June Edition

Master EconBlogger Jason Shafrin hosts this week's collection of wonky health care posts. If you like soccer (aka "metric football"), you'll love this HWR.

Let's Make a (Health Care) Deal

As Bob has pointed out, a major problem for funding all these wonderful new initiatives is that the price tag keeps getting bigger and bigger, but no one in DC really has any idea of how to pay for it. One way, of course, is to begin taxing employees' health insurance benefits. While that would appear to be a non-starter (a lot of "employees" are also "voters"), there's one large, implacable and irresistible force that could make it happen:

"(U)nion workers who helped Democrats win Congress and the White House and whose support will be key in getting a health bill signed into law would not pay the tax."

Yup, that should do it. After all, if the unions can't count on their own employees (aka the Legislative and Executive branches), then what was the point of all that campaign moola? And since they now basically own (in conjunction with those employees) major swaths of industry, it seems pretty likely that they'd get their way.

Of course, if they're exempt, what about all those poor non-union employees?

"Tough luck, bud."

On the other hand, we know that the cost of at least part of the proposals now on the table is a major reduction in the cost of medication, maybe this won't be so bad. After all, reducing the cost of drugs is sure to lower the overall cost of health care, and hence health insurance.

Right?

Well, not so much:

"The Obama White House cannot explain more than half of today's announced $80 billion in prescription drug savings."

Oh.

So the $80 billion in savings (which would do so much to alleviate the expected multi-trillion dollar government expansion into health care and insurance) just got halved? That can't be good.

The underlying problem is that no one in Washington really understands the relationship between health care costs and health insurance costs, so no plan realistically addresses either one. The overarching motto is "throw more money at it." Of course, there's no evidence that this approach has ever worked in the long run, but hey, pols aren't known for letting reality get in the way.

Take Me Out to Grand Rounds

Nurse-blogger Barbara Olson manages this week's line-up of health posts, complete with CrackerJack and beer (okay, no beer). She's sure hit a home-run fielding this outstanding team of interesting med-posts.

That Paradox

The New York Times reported on June 21 (3rd paragraph) “While 85 percent of respondents said the health care system needed to be fundamentally changed or completely rebuilt, 77 percent said they were very or somewhat satisfied with the quality of their own care.”

The Times refers to the survey result as “that paradox” (4th paragraph) but strangely, in the remainder of the 21-paragraph article, the reporters and editors at the New York Times do not probe for an explanation of the paradox, as though they have no interest in understanding it. Well, perhaps they think the paradox is unimportant? Apparently not. The Times blames the failure of the Clinton plan on “that paradox” - - 16 years ago (4th paragraph). That makes the paradox pretty important, it seems to me. And the Times' opinion on the failure of the Clinton plan is surprising because that plan failed 16 years before the present survey was conducted.

Well, perhaps the Times is merely conceding “that paradox” has existed for at least 16 years (I have evidence in my files that “that paradox” has existed for more than 30 years, but never mind). OK, but then if it is such a powerful and apparently paradoxical fact in public opinion that has existed for 16+ years, why does the Times not even attempt to explain it?

It’s my belief “that paradox” exists precisely because (1) most people are in fact generally satisfied with their medical care and (2) slanted media reporting across all those years has created the impression that most people are NOT satisfied with their medical care. So it's understandable that surveys report most people are satisfied, but believe most others are not.

In other words, “that paradox” which the Times does not explain and pointedly ignores, is the difference between what people experience for themselves, and what media such as the Times tell them is experienced by others. So I ask: who ya gonna believe? The New York Times or your own lyin eyes?

PS – Is this paradox newsworthy? I think so. Well then, why would the Times not print all the news; isn’t it fit to print? My answer: with depressing regularity, the Times deems news not fit to print when it does not fit the Times’ agenda. What is the Times’ agenda? In this area, the Times supports universal, government-controlled medical care. But if the Times were to concede that most people are generally satisfied with the quality of their own medical care, what then? Well, that would admit a powerful argument that takeover of the present system by the federales is just unnecessary. Therefore – Times won’t print that. Times won’t acknowledge that line of argument has merit – or, even, that it exists.

Carnival of Personal Finance: Iron Mike edition

Check out this week's bout of the Carnival of Personal Finance at the Suburban Dollar blog. It won't box you in, but it might knock you out (in a good way).

Transparency, Canadian-Style

For all the hoopla over transparency (and we've been advocating greater transparency in health care for a long, long time), the private sector seems to be ahead of the public. We see that in carrier tools like Aetna's Navigator, for example, and with a growing number of physicians' offices which share their pricing information with patients. True, Medicare has been working on this issue, and kudos to that agency for acknowleding transparency's value.

Unfortunately, our Neighbors to the North© aren't necessarily "true believers," and since the gummint-run system is the only game in town, that's a problem. For example, the Providence of Alberta seems reluctant to share data that some might consider critical to their own care and well-being:

"One Alberta hospital has an injury rate for newborns more than four times the provincial average. Patients in another Alberta hospital are five times as likely to pick up an infection following medical care, while patients at yet another hospital are more than twice as likely to experience bed sores ... But the report is unable to provide the names of specific hospitals because Alberta Health Services refused to release hospital names."

If one needs inpatient care, it might be nice to know which facility to skip to avoid bed sores. If one expects a lengthy recovery, it might be helpful to know which one to pass on to avoid an increased risk of infection. There may, in fact, be good reasons why a particular facility has more cases of a given condition, based on its focus (heart care, oncology, etc). But absent that information, no one really knows for sure.

As we rush headlong toward a similar system, it may be worth asking whether that's something we really want.

[Hat Tip: Leah Costello]

HRA's in Hot Water?

We've written extensively on the subject of healthy choices, and how these can positively affect insurance premiums. This can be especially helpful in the group arena, where employers often use a tool called a Health Risk Assessment (HRA) to help guage employees' health. This, in turn, is used by the insurer as one factor in the rate-setting process.

Some employers have gone so far as to require their employees to complete these forms as a pre-condition to participating in the group insurance program. In fact, the Department of Labor (which oversees ERISA, or self-funded, plans) actively endorses these tools as a way to help contain insurance and health care costs.

Alert Reader© Jeff M informs us that another gummint agency, the EEOC (Equal Employment Opportunity Commission) may be putting the kibosh on this little excercise:

"Seemingly oblivious to the ever-increasing concern shared by the rest of the country over rising health care costs, the U.S. Equal Employment Opportunity Commission recently cast doubt on the use of health risk assessments, a proven effective tool in the fight against rising group health insurance costs ... the [EEOC] issued a letter to an unidentified municipality, stating that the county’s conditioning of eligibility for its health plan on the completion of an HRA violates the Americans with Disabilities Act."

Ooops.

At present, this kerfluffle is just that, "an informal discussion on HRAs and health insurance coverage;" it's not an official "cease and desist" matter.

Yet.

We'll keep you posted.

Alzheimer's is NOT (Political) Fair Game

As we've noted more than once, although we are not apolitical, IB is not a "political blog" (poliblog). We don't, for example, endorse candidates or particular legislation. Sometimes, though, the political class oversteps its bounds and, in the popular lingo, "jumps the shark." The outrageous and utterly despicable smear against (now former) Inspector General Gerald Walpin is without honor or decency, and directly slights every Alzheimer's patient, their families, and those who care about them.

Regardless of one's political persuasion, there is simply no excuse for casually claiming that someone with whom one is in political disagreement is suffering from dementia or senility. Mr Walpin was fired from his post for reasons political, but President "57 States" Obama felt it appropriate to claim that the IG was dismissed because he was "confused, disoriented, unable to answer questions and exhibited other behavior that led the Board to question his capacity to serve;” all text-book definitions of Alzheimer's.

Having watched and cared for a real Alzheimer's victim, and having seen how Mr Walpin comports himself on television (indeed, passing a standard state-approved "mini-test" for dementia), it is obvious that this is a man in complete control and awareness of his faculties. It is an insult to my mother, and to the thousands of others who truly suffer from this horrid affliction.

It is simply inexcusable.