Wednesday, February 12, 2014
An Economic Conundrum
Is our outsized health care system an economic plus or minus?
The conventional wisdom, which I have tended to accept, is that our unusually costly system places an undue financial burden on government, makes our industry less competitive internationally and unnecessarily consumes resources that would otherwise be devoted to something else. Thus, the economy would benefit if we spent less on health care.
In contrast to that, columnist Benjamin Applebaum argues in the February 9 Sunday New York Times that during the last two years the health care system has been a drag on the economy because it has grown more slowly than the economy as a whole (Will Saving on Health Care Hurt the Economy?).
He also points out that “The health care sector has repeatedly helped to pull the economy from recession in recent decades….” Certainly, it seems likely that unemployment during the recent recession would have been higher if it were not for the large number of people employed in health care, which is largely recession-proof.
The stubbornness of unemployment, attributed in large part to globalization of the labor market and information technology, poses the question of whether in the foreseeable future there will be enough jobs to employ all our unskilled and semi-skilled people. Health care employs a lot of them. Maybe that is a good thing.
Applebaum’s column ends by quoting Harvard School of Public Health Economist Katherine Baiker who favors a more efficient health care system. She said “….for a given outcome, if you could get it with fewer resources, that would be better for everyone. You could get more health. You could get more stuff.”
Well, maybe. But then again, maybe not.
Sunday, February 09, 2014
For years I have been of the opinion that the problem with medical malpractice was that there was too much of it and that prevention efforts would be more effective as a remedy than attempts to reform the legal system.
I now sense a slight movement in my direction. The January issue of Health Affairs featured several articles on the subject. The introductory column by founding editor John Inglehart reported that the designers of Obamacare considered including medical malpractice reform but decided that the political risks involved in getting in between the personal injury bar and the medical profession were too great. They punted by including an appropriation of $25 million to fund a search for new approaches to medical liability and demonstrations of evidence-based patient safety programs.
Judging from the articles, most of the effort has been focused in the area known as Communication-and-Resolution. Under this approach, medical errors are reported to the patient as soon as they become known and compensation offered for damages. This is in contrast to past practices of sitting tight and fighting the matter out in court.
One article dealt with “safe harbor” legislation, which limits liability if the physician can demonstrate that “designated guidelines” have been followed. In other words, if there is an established protocol for a procedure and it has been followed, the legal liability for adverse results will be reduced. The authors doubted that the “safe harbor” approach would have much effect on malpractice settlements but speculated that following protocols could improve patient safety and, thereby, the number of adverse events leading to malpractice claims.
Prevention may not yet be popular but perhaps some people are starting to think about it.
Friday, February 07, 2014
The Logic of Obamacare
Here is the logic of Obamacare as best I can figure it out:
- Everybody who needs care should get it.
- People should be able to receive care without incurring undue economic hardship.
- Most people are not financially able to pay for care at the time it is received.
- Universal national health insurance cannot be achieved politically in this country.
- Everybody should have health insurance that will cover most of the cost of the care they receive.
- Health care for the non-senior, employed population and its dependents should be funded in the private sector.
- Government should subsidize care for those who can’t afford adequate coverage.
Opponents of Obamacare apparently do not accept this logic. It would be interesting to know what logic they would put in its place.
Monday, January 13, 2014
For many years, the health care system generally and the medical profession in particular was left free to manage its own affairs. “Doctor knows best” was a guiding principle and nobody wanted to be accused of interfering in the practice of medicine or in the doctor-patient relationship.
The result was the conferring of great power, and as Baron Acton observed a century and a quarter ago, power corrupts.
That principle was vividly illustrated in an article appearing in the January 11 edition of the Omaha World Herald and headlined “For ‘never events,’ stray surgery items are disturbingly common.” The article, over the by-line of local columnist Matthew Hansen, was occasioned by a lawsuit brought by a lady in whom a fluid-filled surgical glove had been left following surgery at an Omaha hospital.
‘Never events’ are events that should never happen, like leaving foreign objects in patients after surgery. The most common such items are sponges used to soak up blood. Hansen quoted a number of apparently authoritative estimates of how often sponges are left in patients in US hospitals and the numbers ranged from 500 to 6,000 per year.
According to the article, techniques involving bar codes and tiny radio-frequency tags are available to prevent this from happening. Using them. the Mayo Clinic has not lost a sponge in four years. Indiana University Health System hasn’t lost one in five years.
The cost is about $10 per procedure but no hospital in Omaha is using the technology. I consider that to be inexcusable negligence attributable to the power granted to those institutions. Corruption in the sense of an erosion of standards seems like a suitable word to describe the condition.
Sunday, January 05, 2014
I never cease to be surprised at the durability of myths that become imbedded in the culture. Hospital emergency rooms are a case in point. One such myth is that the cost of health care would be lower if ER patients got their care from clinics and doctors’ offices instead. Another is that patients go to ERs because they lack insurance to pay for private care.
The latter is getting shot down in Oregon. Lacking enough money to cover everybody eligible for Medicaid, the state resorted to a lottery. Winners got coverage and losers did not. Some clever researchers then studied the ER utilization of the two groups in the Portland area. What they found was that people in the insured group made 40 per cent more ER visits than those without coverage.
I read about this in a New York Times article carried in the January 3 issue of the Omaha World Herald. The headline was “Surprise finding; Newly insured poor make more trips to the ER.” Well, the World Herald might have been surprised, as were many luminaries it quoted, but I was not.
So far as I can tell, the anti-ER mythology has its origins in the time when private practice physicians ruled health care. Those physicians did not like to be called to the ER on Sunday afternoon to treat a runny nose. They provided ER coverage on a rotating basis, raising the disconcerting possibility that a doctor on call would see another doctor’s patient in the ER and elect to provide follow-up himself. Doctors not on call were also mindful of the possibility of missed fees when patients of theirs who might have come to their offices sought ER care instead.
The consequence was that ERs got a bad name that has persisted despite their continually growing popularity as a source of care.
People use ER’s because they are conveniently available when care is felt to be needed. Not such a difficult thing to comprehend if the opposing mythology can be overcome.
Maybe the Oregon experience will help do that.
Monday, November 11, 2013
For some years now I have been wrestling with a dilemma. On the one hand, I have been suspicious of commercial approaches to health care, believing that the interests of patients should rank higher than those of investors. On the other hand I have increasingly become convinced that economic incentive is the only thing that will cause anyone to get serious about addressing the cost of health care.
Then I read an article in the New York Times Magazine of Sunday, November 3 about Tom Scully and his new company Navicare. During the 1990’s, Scully was head of the Federation of American Hospitals – the trade association of investor-owned hospitals – and from that position became head of the federal Centers for Medicare and Medicaid Services under President George W. Bush.
Navicare was formed to manage the care patients receive after hospitalization, known as post-acute care. The prevailing routine has been that when post-acute care is needed, the doctor discharging a patient from hospitalization prescribes nursing home, rehab, or home health care and then has nothing further to do with it. Providers of those services are paid on a fee-for-service basis and so the more service they provide, the more revenue they generate. Navicare undertakes to reduce cost by managing the process and makes money by contracting with health insurance companies to share the savings.
The prospects look bright. One can imagine opportunities for commercial abuse, but they seem rather unlikely to present problems.
Maybe we are beginning to discover workable and acceptable ways to use economic incentives to get cost under control.
Friday, November 01, 2013
When quoting cautious Norwegians, Garrison Keillor, the St. Paul raconteur, makes common use of the word “mostly;” as in “Lutherans are hard-working people, mostly.”
If President Obama had followed that pattern when promoting his healthcare reform bill, he would have said something like “People who like their present health care insurance policies can keep them, mostly.”
But he left off the qualifier. For that he is getting the Pinocchio award. And deservedly so.
Actually, what he should have said to be completely forthcoming was that people who like their present health care insurance policies can keep them, if they continue to be offered by the insurance company. The Affordable Care Act, a.k.a. Obamacare, prescribes the basic benefits that health insurance policies must cover, but it exempts policies that were in effect at the time the law was passed.
As it happens, however, insurance companies change their policies frequently –notifying subscribers by means of unintelligible documents sent in the mail - and so by now, some three years later, many of the policies that were grandfathered have been modified and have lost their exemption. A common reason for not meeting requirements is that the benefits are too skimpy, meaning that policies that qualify for approval offer more coverage and often cost more.
That may give the President a technical out, but does not let him off the hook, in my opinion.