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Networking to Develop the Ideal HealthPlan for the USA
HPUSA Quarterly Fifth Tuesday E-Letter, July 2003
Join the Medical/Professional/Business Gatherings on MedicalTuesdays. This Is the Fifth Tuesday Which Occurs Once Every Quarter at Which Time We Review the Ideal HealthPlan for the USA and by Extension for All Countries.
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In This Issue:
1. Can We Agree That We Want to Make HealthCare Affordable to All Americans?
2. Liberal Arguments from the Commonwealth Fund
3. Conservative Arguments from the Ethan Allan Institute (One of 41 State Policy Institutes)
4. The Basic Non-Negotiable Conflict
5. Government Health Care in Historical Perspective
6. Government Exempts Itself From Government HealthCare
7. Election Subterfuge
8. Our Quarterly Review of HealthPlanUSA
Can We Get Beyond Our Liberal (Socialism or Statist Accountability) and Conservative (Free Market or Individual Accountability) Backgrounds and Agree on Our Common Purpose to make Health Care Affordable to All Americans?
According to some, the problem with socialism is that humans oppress humans. Others say the problem with the free market is just the reverse. And therein lies the enigma. Howard Dean, MD, governor of Vermont, is alleged to have said in 1992, "There is no such thing as an informed consumer of health care." When Governor Dean’s single-payer socialistic plans were rejected, he attempted to expand Medicaid by making it available to anyone with an annual income of less than $51,000. After eleven Dean years, the state’s share of Medicaid spending has risen from $86.7 million to $263.5 million, and the number of uninsured has crept up slightly from 9.5 percent to 9.7 percent. One response to the near destruction of the private insurance market was, “The difference between a physician and a non physician in this position is that the non physician is aiming the guns more at random, but the physician knows exactly where to aim the cannon in order to do the most damage.” So the answers to making health care affordable must lie elsewhere.
If one looks at the mission statements of Liberal or Socialistic organizations and Conservative or Free Market organizations, it is amazing how much they overlap. They all seem sincere in striving for a common goal for the welfare of humankind. Then why are we so far apart?
Liberals or Statists
For liberals, the Commonwealth Fund Mission Statement found on their website probably reflects their general thinking. It reads as follows: The Commonwealth Fund is a private foundation established in 1918 by Anna M. Harkness with the broad charge to enhance the common good. The Fund carries out this mandate by supporting efforts that help people live healthy and productive lives, and by assisting specific groups with serious and neglected problems. The Fund supports independent research on health and social issues and makes grants to improve health care practice and policy. See http://www.cmwf.org/programs/insurance/ (Who can argue with their goals in child development, preventive care, helping frail elders, improving health care quality, helping uninsured and under-served people, and improving minority health?)
Conservatives or Free Marketeers
For conservatives, The Ethan Allen Institute Description and Mission Statement found on their site is probably reflective of the general thinking of this group. It reads as follows: The Ethan Allen Institute is Vermont's independent, nonpartisan, free-market-oriented public policy think tank. The Institute offers "Ideas for Vermont's Future" built upon a libertarian, de-centralist, community-based philosophy. The Mission of the Ethan Allen Institute is to influence public policy in Vermont by helping its people to better understand and put into practice the fundamentals of a free society: individual liberty, private property, competitive free enterprise, limited and frugal government, strong local communities, personal responsibility, and expanded opportunity for human endeavor. Please see http://www.ethanallen.org/index2.html. It is one of some 41 similar but independent state organizations associated with the State Policy Network. Click on “links” to see the other 41 organizations. (Who can argue with their goals of Individual Freedom, Parental Choice In Education, Health Care Affordability and Access, School Children First, A Citizen Initiative, Reviving Health Insurance in Vermont and Vermont Medisave Plan?)
But the Primary Difference Appears to Be in
Who Sets the Goals
Reviewing the hundreds of items on each site, there are many worthwhile goals. But the primary difference appears to be in who sets the goals. On the left, there appears to be the attitude that health care it too complicated for the patient to navigate. Hence, we have to have those in authority determine who should receive care, what kind of care should they receive and when should they receive this care. They feel that this should be done with a single-payer, socialistic, or government-controlled system that, in theory, covers everyone. The reason there are so many on health care waiting lists that may extend into months and years in some single-payer countries, is because tax rates are kept too low by those free marketeers. With a marginal tax rate that exceeds 50 percent in many countries and approaches 50 percent in the US, one patient expressed concern that it may have to go to 100 percent. And if that is not enough, it will continue to increase until poverty is a thing of the past and health care is available to all. I was unable to find any evidence-based statistics to support this ever happening. As Vermont has recently experienced, it seemed to work in the opposite direction. Dan Weintraub has noted in his column in the Sacramento Bee that California again needs those 50,000 wealthy taxpayers that were lost in the economic downturn.
On the right, the consensus is that everyone should have the freedom to choose their own destiny - any plan they feel appropriate or possibly no health insurance at all. There is general agreement that first dollar coverage is expensive due to overutilization because there is no market force that discourages unlimited appetites for unnecessary health care. (When writing this, I was interrupted by a slightly nauseated patient who went to the emergency room, had abdominal CTs, ultrasounds, x-rays, numerous lab tests and requested permission to return for more extensive testing because she regurgitated her lunch. She felt fine when I talked to her. She did not need another thousand dollars worth of testing, just the common sense to let an upset stomach rest for a half day or so. None of the thousands of dollars spent on tests had any medical value to her case. Yet she could only think of requesting more tests until the reason for her nausea was unequivocally determined–which it seldom is.) Most supporters of individual accountability recommend high deductible health plans that would cover hospital care with cash payment for outpatient medical care. Medical savings accounts (MSA) are touted as a big answer to the problem of access. They have been successful in South Africa and many parts of the United States. Two caveats of MSAs have not been adequately addressed. First, MSAs provide initial dollar coverage which is considered inappropriate by some of the same promoters. The other is that it has been shown that even the upper middle class has difficulty placing a few thousand dollars into an MSA account to cover outpatient medical care until the high deductible is reached. However, the biggest objection is not appreciated. It does require government approval to allow the $2,000 or so be placed in a tax-free account. Will a Congress that had great difficulty in allowing a $2,000 individual retirement account (IRA) that was implemented, withdrawn, and recently reimplemented really allow for stability in a tax-free MSA account? And when a Congress that oversees spending realizes that individuals who had difficulty spending their MSA contributions for health care were allowed to use these tax-deductible accounts for diet programs and massage therapy, items that clearly are not insurable, the life expectancy of the program will be very short despite any initial and even extensive enthusiasm.
Is the Conflict Non-Negotiable?
So if our mutual goals are to improve people’s health and access to health care, the non-negotiable difference seems to be who decides. Is it the Commonwealth Fund, the Robert Wood Johnson Foundation and others who influence government to take over our lives, or the so-called free marketeers who believe that individuals should decide for themselves, or those halfway in-between who still want the government involved in a very intricate manner telling us exactly how we may proceed with MSAs and other similar plans.
If both sides really want the government involved, whether to a major or minor degree, what is the record of the government’s involvement in health care. Over the past fifteen months we have outlined the challenges of governments throughout the world in their efforts to provide health care to their citizens. The picture wasn’t all that pretty. In our own country, we have seen massive government intrusion into health care through Medicare, for those 65 years of age or disabled, and through Medicaid, for the poor, as a catch net for the 15 percent or so of society that have difficulty or are unable to work, with regulations for everyone in-between. This alone makes it difficult to even write an acceptable insurance plan. Has the government been a good steward of funds entrusted to it?
Dr. Madeleine Pelner Cosman, an attorney with Medical Equity, Inc. in San Diego, has a chapter in her book Who Owns Your Body? America's 9 Deadly Medical Myths that outlines how well government can manage health care costs. "One year after Medicare was signed into law, the House Ways and Means Committee estimated that by 1990 the program would cost a mere 12 billion dollars. The actual figure was over 107 billion dollars." (Only a 900 percent error.)
"In 1965, federal actuaries projected that the hospital program would grow to only $9 billion by 1990. The program ended up costing more than $66 billion that year." (A 700 percent error.) (Medicare's Midlife Crisis, Sue A. Blevins, Cato Institute/Washington, DC/2001, p. 55.)
"What is the size of Medicare? Try this one for size - $268 B and some change. And across the board, using this thing called 'averages,' Medicare provides reimbursements amounting to about 58 percent of total spending for that beneficiary population." (Some would say that Medicare is underfunded.)
An actuary at the Social Security Administration states that the premiums paid by those 65 and over are about 25 percent of what the actual premiums should be. (Others would say that Medicare benefits are four times as generous as the system allows.)
A HealthCare Forum participant stated, “Medicare is quite nice for seniors--it is the young taxpayers that are getting fleeced. Seniors can have any service they want, as long as it is a covered procedure. They can see their doctor whenever they want, have any blood test done. Whenever they get ‘nervous,’ they can show up in the ER and have 6 tests done before they are reassured that they'll be OK. No one is quick to tell a senior that he is accessing the system too often. It is a phenomenally expensive program, with no end in sight. Did you ever see a senior get prosecuted for ‘fraud and abuse’ of the Medicare system? No–only doctors and hospitals get fined. Yes–senior citizens in this system have it nice–and now they want free prescriptions. Seniors are the most well-off segment of society right now–as a whole. Most, who were careful, own their own homes, have a nice little nest-egg, get pensions and Social Security. They are quite well-off as a group.”
Congress Exempts Itself
Congress is doing its best to exempt federal retirees, including retired members of Congress, from its Medicare reform bills: "Rep. Thomas Davis (R., Va.), the sponsor of the House bill, told Congress Daily AM this special exemption for federal retirees was necessary because the government must have "the right incentives to attract and retain the best and the brightest."
This reasoning obviously does not apply to those of us in the private sector.
Likewise, Sen. Daniel Akaka (D., Haw.), a sponsor of a similar Senate bill, recently told The Times that current and future federal retirees "should not face a situation in which they must rely on Medicare."
It figures. Lawmakers finally decide to look at the unpleasant effects of the Medicare legislation they passed —then they pass a separate law to exempt themselves and federal workers.
An AFL-CIO Union Affiliate Tells How to Hoodwink
the Public When Selling Single-Payer Medicine at the next Election
Harry and Louise have become Shirley and Gina in the next campaign according to the Sacramento Bee last month. During the Clinton administration, the popular advertisement featuring Harry and Louise, that called the administration health plan the work of “big government,” stuck like Velcro. It doomed the national socialized medicine plan. The liberals want to control the debate this time. They are proposing the following operating rules. If Rx for Health Care emerges in the 2004 race, thank Shirley Rae who allegedly could scare the support hose off Nurse Ratchet. “Running for President?” she asks, staring down from her billboard. “Health care better be your priority.” The ad is the work of Americans for Health Care, and more specifically, New Hampshire for Health Care, one of several locally run issue campaigns funded by the Service Employees International Union. An AFL-CIO affiliate, the SEIU is one of the largest and fastest growing unions in the country. It represents 1.4 million health-care workers, janitors, state and city employees, check-out girls and security guards in North America. It’s known as a grass-roots powerhouse, a union of the future with a dynamic leadership and young, active and loyal members.
The task for the SEIU in the next 18 months is to prevent such distractions as Harry and Louise from recurring. Its goal is to make health-care reform so fundamental a part of the national conversation that no campaign, no pollster and no media consultant can avoid the subject. “A candidate must have a health-care plan that provides universal coverage, or very close to it, and includes how it will be financed.” Jay Ward said organizers looked for phrases that “Didn’t put up fences.” Some buzz words to stay away from: “Canadian Model” doesn’t sell well. “Socialized Medicine” does sell well. Anything to do with government “Intervention” “Administration” or “Regulation” doesn’t work.
The language New Hampshire for Health Care chose for its resolution includes mild-mannered adjectives like “fair” and “basic,” terms to which it would be hard for a voter not to find a personal connection. It stays clear of policy solutions and ideological debates. It calls for politicians to “work with consumers, businesses, and health care providers to ensure that everyone, including the self-employed, unemployed, under insured and small business owners, has access to an affordable basic health care plan similar to what federal employees receive.”
Avoid issues such as who pays for it, just call on politicians to again “work with consumer, business and health-care providers to ensure that everyone including employers, consumers and the state, local and federal government makes responsible and fair contributions to finance the health care system.” (But when many Americans don’t know where the government gets all its money, this is really a winner.)
To evaluate each candidate’s plan’s effectiveness and financing, the SEIU has established the White Mountain Group, an eclectic, non-partisan think tank made up of anonymous-for now, at least-union leaders, health care professionals, providers, business leaders and academics. The group is run by Ken Thorpe, a professor of health policy at Emory University and the man who crunched the numbers for the 1994 reform proposals as the Clinton administration’s deputy assistant secretary of Health and Human Services. As each candidate releases his health care proposal, the White Mountain Group will release an analysis of the plan. Experts says the longer a group waits to endorse, the longer it’s courted, and the more influence it can have over conversation. (WOW)
It does appear that those that want state control over personal, private health matters and those that want their personal, confidential health matters to remain private are at war with each other. Can we call a truce? Or as King Solomon says in his Book of Wisdom, let’s not be hasty in judgement . . . testify without cause. . . .Or use your lips to deceive. He advises to argue without betrayal. Can we lay all our cards in the house built by wisdom, established through understanding, rooms filled with knowledge and beautiful treasures? He who plots evil will be known as a schemer, who will falter in times of trouble. (Chapter 24)
The MSAs need continuing governmental approval. A large number of well-to-do are unable to fund them. Although those who have difficulty placing the $2,000 or so in the MSA account, have no difficulty paying $2,000 on a credit card over the course of a year. The tax-free account is used for first dollar medical care–which is not market-based medicine. We have demonstrated in prior issues that high deductibility insurance has been discarded by many wealthy. I have corporate executives worth millions that see me on an HMO plan. MedicalTuesday agrees with CALPERS, California’s Public Employees Retirement System, which stated that the yearly deductible should be what a complete physical examination costs. When it was first mentioned, the figure was $300 and has now been raised to $500.
The item that returns this plan to the Medical MarketPlace, with the patient continuously monitoring and policing his Health Care, is a co-payment. Co-payment should be tiered to the type of care. We have shown in a number of instances that a 10 percent patient liability for hospital care will encourage individuals to consider the cost-benefit ratio of each hospitalization. With this model, we estimate a 30 percent reduction in hospital costs while our actuarial consultant estimates up to a 50 percent reduction in hospital costs. http://www.medicaltuesday.net/Apr2903.html
We have shown instances where a 20 percent patient liability on outpatient surgery or emergency room care will encourage individuals to consider the cost–benefit ratio of each outpatient hospital or ER evaluation. This may also provide a 30-50 percent reduction in outpatient surgical/ER costs. I am successful in persuading a third of my patients who call after hours to come in to the office the following morning rather than going to the Emergency Room. Of those that proceed to the Emergency Room, more than half do not have an emergency. The problem can often be easily treated in the office at one-tenth the cost. The ER is utilized as an outpatient facility for convenience.
We continue to accumulate anecdotal evidence that a 30 percent co-payment for all outpatient care, laboratory tests and x-rays would place outpatient medicine in the Medical MarketPlace. Patient demands for expensive, unnecessary CTs and MRIs would come to a screeching halt. The time spent in writing patient-demanded justification would eliminate a large drag on the health care system.
We have provided anecdotal evidence that a 40 percent patient liability for durable medical devices such as electric wheel chairs, hospital beds and respiratory equipment will cause each individual to consider the cost–benefit ratio of each piece of medical equipment and deciding between that which would be therapeutically useful versus that which would be nice conveniences or status symbols. We have a significant number of patients who have demanded a $900 respiratory inhalation device only to store them in a closet after few months because they get tired of the cleaning and maintenance. Some even forget that they have them when they make a second request a few years later for that same device. Anecdotal evidence seems to show less enthusiasm for acquiring expensive equipment and an improvement in memory of having one stored in their closet if a personal liability of 40 percent had occurred and would recur if repeated.
Several of our readers have already implemented a medical visa card to facility the co-payment and deductible amounts. Formalizing this may make it more affordable than an MSA account.
Since each patient will have a financial interest in decreasing costs, the above changes will eliminate the army of medical, nursing and clerical policemen and policewomen who now evaluate every chart in hospitals, and also eliminate the micro-managing of every health care decision and cost and prosecuting for over use. We are now working on similar data in regard to skilled nursing facility coverage.
We have recently interviewed for the Chief of Information Technology (CIO)and hope to formalize that position in the next few months. Our web site is being updated and modernized. It will have a bulletin board to post members’ comments. We have recently added a secretary to help us process the active dialogue we are experiencing. She can be reached at Janey@HealthPlanUSA.net to process address changes until our web site is automated. Hopefully we’ll have more scientific and clinical data on our next quarterly HealthPlanUSA report. The addition of repeated anecdotal information becomes data which requires continued interpretation. The progression of this can be followed at www.HealthPlanUSA.net.
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Del Meyer, MD, CEO & Founder
I shall be telling this with a sigh,
Sometime ages and ages hence.
Two roads divided in the woods, and I - Took the one less traveled by.
And it has made all the difference.