republican healthcare

8/14/2019 Republican Healthcare

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Republican HealthcareWho needs death panels? People are dying of neglect.

Healthcare cost Americans 5 trillion dollars a year. This is what 5 trillion dollars lookslike: 5,000,000,000,000. Thats about $16,500 per American per year.

Have you noticed that just about every hospital in the country is expanding and hundredsof new Medical Centers are being built? One under construction just off of I-95 northof Trenton, NJ is being built at an estimated cost of $500 million, and another, less than20 miles away near Princeton is being build with a similar price tag of $500 million. Iliken these facilities to those inflatable sports arenas that depend on air compressors tokeep them inflated only in this case, well be pumping in a constant stream of money.These facilities need to be staffed, cleaned, maintained, powered and heated forever. Themore medical facilities we build, the higher the costs. Even in my small NH town, ourlocal hospital has been expanding for over 10 years, with no end in sight. Clearly, thedemand for services has grown the question is, whats driving the demand?

I used to think that healthcare was a finite resource, but given the unchecked growth injust one decade, Im not so sure. I used to argue that, because it is a finite resource,decisions to spend money on, say, cosmetic surgery, would limit resources spent on moreimportant medical care, like preventative care for children. But, as we spend more andmore of our GDP on healthcare, and a growing part of that on boutique healthcare likebreast enhancement theres actually a lobby demanding insurance coverage Ivebecome convinced that rational decision making has been overrun by a plethora ofspecial interests. Of course, end-of-life care takes up the largest share of our healthcaredollar, but were a long way from dealing with that rationally, so I just as soon leave thatsubject for another day.

What has become clear is that our ability to fix problems, any problem, is hamstrung bycompeting interests in Washington. (Is this how civilizations fail; under the weight ofcompeting, entrenched interests? Is this why China has been able to accomplish so muchin such a short period of time because they arent replacing anything, entrenched orotherwise; theyre building infrastructure from scratch?) Anyway, moving on

Here are some proposals that Republicans have made. A few are worth considering, withcaveats.

People should pay. One Republican proposal that has currency is this: if people had topay for their own healthcare and had insurance only to cover catastrophic expenses, they

would more likely know how much healthcare cost. This knowledge would be all thatwould be needed to hold down costs. People would, the argument goes, seek out lessexpensive services and demand that doctors charge less. The commonsense simplicityof this idea is its attraction. However, in recent years, as insurance premiums havegrown, families have been saddled with higher and higher deductibles and less and lesscoverage. Its not unusual for group plans to have $1500 or $2000 deductibles. Yettheres little evidence of pushback by patients. Why? While some people may be boldenough to negotiate prices or challenge their doctors fees, most people are less inclined.

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It takes a confident, well-educated patient to challenge his/her doctor. Most people areintimidated by their physicians. Its not in their nature to challenge a doctors fees, muchless the fees assessed by their hospital or health center. The more likely response is thatpeople will avoid seeing a doctor and, worse, avoid taking their children for checkups,until a problem is serious and they end up in the emergency room. In fact, the effect of

higher deductible is twofold; it discourages families from utilizing services and itincreases insurance company profits. (Note: even for plans that increased deductiblelimits, premiums increased. And, Anthem Blue Cross in California just announced a40% increase!) Most plans require co-payments of anywhere from $15 to $25. Whilethat may not seem like much, to someone who is struggling financially, its enough todiscourage irresponsible over-utilization of services.

While I dont reject the need for people to be aware of the cost of care or of having tobear some of the responsibility for their healthcare, these arent a solution to escalatingcosts. We need to employ other mechanisms. But what?

I find it ironic that while Republicans complain that the bills in Congress do nothing tohold down costs a debatable point theyve resisted remedies like comparativeeffectiveness research, which can provide doctors with information about the most cost-effective remedies, and they resist Medicare cuts. That they vigorously fought theestablishment of Medicare in the 60s and now fight attempts to reduce its costs 50 yearslater is a puzzle, but there you have it.

Selling insurance in any state. The argument is that insurance companies ought to beable to sell policies in any state; that the increase in competition, especially in states withonly a few plans available, would lower costs. Heres the objection: Consider the recenthistory of credit cards. What has happened to that industry since federal law pre-emptedstate regulation? State usury laws were overturned, interest rates and fees escalated,

credit card promotions to individuals least able to pay exploded, and so on. (Hey kid --want a credit card?) OK, so the health insurance industry wants the same freedom. Aswas the case with credit card companies, insurance companies want to be able toestablish headquarters in states with the fewest restrictions and offer insurance to otherstates, overriding local state regulations. If this were just one feature of a comprehensivehealthcare bill that specified a reasonable floor of coverage nationwide, it might beacceptable. But thats not what the Republicans are promoting. If the credit card analogyholds, a piecemeal approach that overrides states ability to write rules for their owncitizens would result in less coverage and higher costs.

Malpractice reform. When asked on the PBS NewsHour what he thought healthcare

reform should consist of, former congressman Dick Armeys only suggestion wasmalpractice reform. Thatfrom the former Republican Majority Leader and nowchairman of FreedomWorks. Malpractice reform. Its hard to take Republican proposalsseriously when virtually all lead with malpractice reform, as if this would miraculouslyprovide coverage to 50 million (or more) Americans. That said, I think that some sort ofmalpractice reform to tamp down the most egregious lawsuits is worth considering, evenif for purely political reasons. But, what are the details of the Republican proposal?According to the NY Times (2/14/10), Republicans are bent on capping damages for

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pain and suffering at $250,000 and generally want punitive damages capped at$500,000. The NY Times doesnt mention compensatory damages, which covers directeconomic affects of an injury including such things as medical cost and loss of income.Assuming that the legislation is mute on compensatory damages, it seems to me thereshould be room for compromise here. Several states already set limits for pain and

suffering and punitive damages. The question is, how have these affected doctorspremiums and medicals costs generally, and, most important, are injured patients beingtreated fairly? Are the caps on punitive damages sufficient to serve as a deterrent? (Notethat punitive damages are rarely applied, since, according to the websitelaw.freeadvice.com, you have to prove willful, wanton or malicious actions by aphysician.)

When contemplating award limits, several questions come to mind. 1) Do the limits onlyapply to doctors, or would they applied more broadly to medical facilities or drug andequipment manufacturers? 2) Wouldnt a larger damage award be appropriate for thesecorporate entities? 3) Are there other ways to punish or fine a corporate entity forcorporate malfeasants other than by rewarding the victim and his/her lawyer inordinatelylarge amounts of money? 4) Instead, should larger punitive awards be applied to somekind of damage fund designed to improve healthcare generally? 5) Should limits bewritten with cost of living clauses? (Ans: Yes.)

So, yes, I can accept that some limits (and perhaps a less confrontational tort system)might be helpful to ameliorate doctors malpractice premiums; everyones legal fees; andunnecessary defensive medical practices, but the mechanism must put the welfare of thepatient first. And, consider this question. With or without threat of malpractice, dodoctors have a financial incentive for ordering tests? Many unnecessary proceduresperformed today are due to the fact that many doctors have a vested interest in theequipment used such as MRI, CATscan or robotic surgical systems, or in the services

provided by outside vendors in which doctors have a ownership stake. Too often doctorsorder tests to boost equipment utilization and their own profits. In this case, so-calleddefensive medicine plays a minor role. And, might doctors refer you to another doctorsbecause of finders fees or for mutual financial benefit, rather than to address a medicalneed? (Ive had this happen to me.)

The reality is that we dont have the answers to the malpractice conundrum. Thats whythe healthcare legislation in Congress offers funding for states to experiment. That, itseems to me, is the sensible way to approach this problem. Even if it were determinedthat the savings from malpractice reform had a minimal effect such as the 1% the GAOpredicts thats still $50 billion a year. Experimental state programs may confirm or

improve on these predicted savings. One can only hope.

Dont touch my Medicare! As for Medicare savings, I think theres a lot that could bedone to cut costs there without undermining quality. My father relates the story thatwhen his wife lie dying in a hospital, doctors would stick there head into the room(literally), ask how she was doing and then send a bill. He received many bills fromdoctors he didnt know, frequently months later, amounting to tens of thousands ofdollars. Medicare paid all of them. Admittedly this is anecdotal, but Ive heard enough

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stories just like it to be reasonably certain this problem is epidemic. What better time tocurb this kind of abuse then when expanding coverage? All of the physicians wanderingaround padding their bills will be needed to serve the millions of new healthcarecustomers. Heres a chance to put them to work. A goal of $400 billion savings over 10years when compared to the 50 trillion (do you want to see what that looks like? No?) is

less than 1%! Why would Republicans object to provisions to curb Medicare abuse by1% except to needlessly worry seniors and kill the bill?

Returning to the question of escalating costs, one reasonable objection to the bills now inCongress is that neither does enough to slow medical costs. I agree. Theyre not devoidof remedies, but nobody can claim theyre comprehensive. But, the healthcare bills dogreatly expand insurance coverage and make it more affordable, and thats a good firststep. No one disagrees that the cost question bending the curve is a tough one.Thats why the healthcare bills address this by promoting experimentation by the states.Replacing fee for service with a system that rewards physicians for keeping peoplehealthy sounds promising, but we need to see how such as system works on a smallerscale before adopting it nationally. Meanwhile, there are millions of people desperatelyin need of care who arent receiving any services, fee-based or otherwise. They should beour first priority.

Another cost-cutting remedy that has gotten too little press is medical informationtechnology. The rollout of medical information systems, some financed by the stimuluspackage, is our best opportunity to improve quality of care and reduce costs. The onlything standing in the way is grey haired docs and all doctors need to be pressed to makeit happen. But is a topic that is best discussed in a separate paper.

As President Obama sits down with Republican to debate healthcare next week, itsimportant that we all have a clear understanding of what is being proposed by both sides.

Its our responsibility to press for solid answers, not sound bites. One thing thatRepublicans need to explain is this: Why is it that in 1993 Republicans were in favormost of the provisions now in the healthcare bills, but now are against them? Andwere not talking about different legislators; were talking about people like Orin Hatchand Chuck Grassley. In fact, the only real difference in the bills they sponsored in 1993and the one before them now is that it included provisions for malpractice reform. MarkPauley, one of the authors of that 1993 bill, recently voiced regret that Republicans haveshifted their position (NPR website, 2/15/2010.) President Obama needs to press theseSenators, in particular, for answers as to when and why theyve changed their positions.Sadly, today politics depends on short memories.

Most Americans have recoiled at the legislative process, complaining about deals andconcessions. Get over it. Thats how democracy works! David Brooks (NY Times)recently suggested on the PBS NewsHour that our government has become tootransparent and that if it were more opaque, it would be easier to get things done inWashington. There may be wisdom in this, but another way to look at it is that maybe,just maybe, the long-term benefit of this new openness is that Americans are beingeducated and eventually will come to understand and accept how the system really works.Hmm. As I write that, I recall the recent Pew Research Poll that found that only 25% of

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Americans know that it takes 60 votes to pass a bill in the Senate and the just 27% knewthat no Republicans voted for the healthcare bill. (Whatever happened to OlympiaSnow?) When you add those finding to other measures of mass misconception (a.k.a.ignorance) geography quiz anyone? Well, maybe Davids right.

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