Reece, personal musings - No Silver Bullets for Health Reform

There are no one, two, or even ten silver bullets. Controlling costs will be very difficult.

Robert Laszewski, Inside-Beltway Consultant, “Naïve Policymakers Need Not Apply,” The Health Care Blog, December 24, 2008

I: Why are you interviewing yourself?
Me: This is my blog, and I will interview whom I please. You might say it’s an I for I, and a truth for a truth. I see I to I, you see, with me.

I: Get serious. What’s this self-imposed blog about?
Me: It’s a history lesson. There’s no mystery to history. It’s the present and future that’s obscure.

When Medicare and Medicaid passed in 1965-1966, the Johnson Administration assured us the combined programs’ cost wouldn’t exceed $9 billion. Now, 43 years later, the cost is approaching $1 trillion, may double in five more years , and threatens to bankrupt the government.

I: What’s the lesson?
Me: There are four lessons.

• One, if you think health care is expensive now, just wait until we have “free” government care. Anytime you have a government program, people will find a way to “game” the system, driving up costs. The government will have to decide selectively what it can pay for, not how it can pay for everything.

• Two, when you expand coverage, you invariably spend more money. As sure as dawn follows darkness, expanded government care will drain the federal treasury.

• Three, money, even federal money, isn’t unlimited with the current budget deficit of $2 trillion or so. No tree, no fee, grows to the sky. There’s no free lunch and no free for service, if you’ll pardon a cliché couplet.

I: Why not pardon you ? It hasn’t stopped you before.
Me: Back to the history lesson.

• Four, complexity science and chaos theory is at work. A butterfly flapping its wings in Brazil can cause a tornado in Texas and 5% of foreclosed mortgages in California can bring down Wall Street. The same forces may be at work in health care.

I: Do I detect a note of cynicism?
Me. No, what you detect is realism based on experience. The only long term solution is to make people pay something out of pocket for health care, with a cap of unaffordable catastrophic care and with unspent tax-free money set aside for retirement. But that will not happen in a society like ours that is afflicted with the entitlement syndrome.

I: So what now?
Me: So universal coverage will become a matter not only or morality but of economics. Take Massachusetts, if you please. Two years after its inception, the Massachusetts universal coverage plan is driving costs out of sight in the second most affluent state in the union and one with one of the lowest rate of uninsured. If it doesn’t work in blue heaven under ideal conditions – affluence, a 10% rate of uninsured, and a liberal culture – will it work in Texas, California, and Florida – with populations of without health insurance estimated at these levels - Texas 24%, California 19%, and Florida 21%

I: So what, if universal coverage is the right thing to do?
Me: Universal health coverage may be the right thing to do, but what good is it if there isn’t any access to primary care doctors – the case in Massachusetts. Universal insurance isn’t the same as universal access. One without the other is meaningless.

I: Look, we can solve the primary care problem by paying primary care doctors more, making primary care doctors debt free by making medical school free for future primary care doctors, erasing the income differences between primary care and specialty doctors.
Me: You are blissfully naïve. According to a recent 400 page report by the Congressional Budget (CBO), we’ll have to attack the following structural problems of U.S care simultaneously and in no particular order for comprehensive reform.

• Change the health insurance system, partly by making health plans offer premiums with pre-existing illness, punishing those profitable HMOs and PPOs and powerful lobbyists , especially those who profit from Medicare drug plans and hundreds of thousands of employees.

• Reform medical malpractice, fat chance with Congress being 70% lawyers.


• Radically alter the tax system, by removing tax-free incentives for corporations and giving it to individuals and small businesses.

• Compelling big business to “pay or play,” meaning fining them is they don’t cover employees, One wonders how this will play politically in a deep recession with big employers already stretched thin and laying off hundreds of thousands of workers.


• Expand access to public programs.

• Incentivize innovations from the private sector without stifling them with foolish regulations.


• Reward health care performers and punish non-compliers, by documenting every health care encounter without creating the illusion that documenting is more important than doctoring.

• Require EMRs for hospitals and doctors and other “providers, to participate in Medicare, even if EMRs cost too much, drive down productivity, have not been shown to cut costs or improve quality.

• Force hospitals and doctors to bundle payments as one entity.

• Insure all children, a no-brainer even for those with no heart.

• Herd those 85% of doctors who now practice independently into multispecialty group practices, put them all on salary, and reduce spending by 30% (Alain Enthoven, “Health Care with a Few Bucks Left ovewr,” New York Times, December 28, 2008).

I: You don’t have to document what you say. I trust you. If you can’t trust me, who can you trust?
Me: Nobody.So I’ll go on.

• Restructure primary care by having doctors serve as directors of medical homes that offer coordinated comprehensive and preventive care.

• Institute cost sharing among hospitals and doctors who perform well and save money..


• Punish fraud and abuse, an inevitable temptation when you’re dealing with federal monies spilling off government printing presses.

• Save and share money from nursing homes, laboratories, and imaging technologies.


• Make having an EMR a condition for participating in Medicare.

• Create a federal technological institute for judging the effectiveness and outcomes of different modes of care.


• And of course, MDR (Mandate, Document, and Regulate) until the cows come home. You can’t trust anyone outside the sacred halls of government.

I: You’re talking about the future. I thought this was going to be a history lesson.
Me: The history lesson is that our health system is a creature of our democratic culture. As a people we desire open-ended access access to the best specialists, latest, and mostl costly technologies, treasure our freedom to choose the specialists of our choice, avoid high taxes for the general social welfare, are leery of big government, and, of course, want someone else pay for it all.

I: Please give me historical examples of what led us to this point, and what makes reform impossible.
Me: I never said reform was impossible, I said “sweeping reform” was difficult. To understand why, I recommend the following readings.

• The Social Transformation of American Medicine, by Paul Starr, 1982. Starr described how American taxpayers rewarded the health care establishment after World War II though the Hill-Burton Act of 1946, funding the National Institutes of Health, and pouring money into research and new technologies, mostly created by big institutions and deployed by specialists.

• And Who Shall Care for the Sick? The Corporate Transformation of Medicine in Minnesota, 1988, by yours truly. As the title implies, I thought managed care would scare off many doctors and leave too few care to care for the sick, and I believed corporations, with HMOs as their surrogates, would transform medicine. As it turned out, managed care failed, retrained costs only temporarily, and drove primary care into the ground.


• The Road to Reform; The Future of Health Care in America, 1994. An instructive text by Eli Ginzberg a noted health reformer, economist, and critic leading us through the maze of complex forces and special interests that make up health care. The book was a prelude to the smashing crash and burning of health care reform as conceived by the Clintons.

The overall history lesson here is: It’s our culture, Stupid! It may be naïve, it may be overly optimistic, it may depend too much on others paying the bill, but it’s our culture.

I: Is there any way to fix the system?
Me: Sure, but it’s going to incremental, it’s going to be painful, it’s going to be by trial and error, it’s going to be the testing and rejection of entrepreneurial innovations, and it’s going to be through an uneasy symbiosis between government and business, with business leading the way in many instances, because its survival is at stake in the global economy and because business can move quickly and decisively. The prospect of bankruptcy in the morning concentrates one’s attention.

I: What about doctors?
Me: Right now doctors are a discouraged, demoralized, and desultory bunch, looking for leadership, in a profession divided into 190 different specialties. But there is a shortage of ud , thanks to government and managed care policies and third parties in general and underestimates of opultion growth. We are in demand, we are mobilizing, and we are asking for a seat at the health reform table. We have leverage because you can’t run the system without us. I think we will respond to the challenges put before us, we will remain the backbone of the delivery system, and we’re fully aware we need the help of physician assistants, nurse practitioners , and all the other physician extenders to make things work. No physician is an island in this complex health care world.

I: So what will an Obama administration do?
Me: The Obama administration will quickly pass universal coverage for kids and fund stem cell research. From there on, it will be uphill, one battle at a time. Health care for all children and money for stem cell research are “feel good” programs, and I endorse them, but they don’t have any real economic consequences in the overall scheme of things.

I applaud Obama’s pragmatic tone, his sense of what’s possible, and his promises of hope. But given the $2 billion deficit, I wonder what is possible without raising taxes. The “rich,” those making over $250,000, are rapidly shrinking as the sole sugar daddies and the soul source capable of financing health care for all. The tax dollars are where they’ve always been – in the middle class. And I frankly don’t see how we can save enough money through EMRs, prevention, and chronic disease management to make a go at universal coverage soon.