Friday, July 31, 2009

Obamacare - DOA for Now

Reforming the health care system is dead. Cause of death? Blunt trauma administered not by Republicans, not even by Blue Dog Democrats, but by the green eyeshades at the Congressional Budget Office.

Conventional wisdom always makes straight-line projections. They are always wrong. Yes, Obama's aura has diminished, in part because of overweening overexposure. But by year's end he will emerge with something he can call health care reform. The Democrats in Congress will pass it because they must. Otherwise, they'll have slain their own savior in his first year in office.

Charles Krauthammer, MD, "Obamacare in Retreat", July 30, 2009

Why has Obamacare died? Everybody has their theory. I have mine. But besides my pet theory, I have questions. I wonder if the Obama team, mired in their own political mindsets and enraptured by their intellect, ever stop to ask why this death is occuring.

Did it ever occur to team Obama that,

1. 80% of the 85% of insured Americans like their private health plans and fear the public option will replace their plans.

2. Medicare does not have the skills to administer a public option, and would have to turn to the evil private plans to administer a public option.

3. To make a public option “affordable” and to control costs, government bureaucrats would have to use the same tactics now employed by private plans - risk adjustments for age and sex and barriers to expensive care and those, particularly the elderly, with costly chronic illnesses.

4. The dreaded and villainous private insurance companies, 1500 of them, employ millions of people, e.g. United Health is the biggest employer in Minnesota.

5. The American legal system is a huge driver of health system costs.

6. Statins and beta blockers have kept millions out of hospitals and have been
instrumental in dropping death rates from heart attacks from 30% to 6%.

7. America is a center right country and Americans consider themselves more conservative than liberal by a ratio of 2:1.

8. Americans cherish their health care freedoms, even when economic retrictions chain them.

9. A Medicare-for-all system would cut physician fees by 20%, would drive hundreds of thousands of them out of business and would result in massive numbers of doctors not accepting new Medicare or Medicaid patients; in other words, universal coverage with universal access might be meaningless.

10. American health care is not the same product as other countries’ health care, in that America offers prompt access to the latest technologies while other
countries ration these technologies, and therefore cost comparisons are often meaningless. Americans receive superior care, technologically.

11. The cost of medical interventions in the middle aged and early and middle old – e.g. cataracts, angioplasties, bypass surgeries, joint replacements, and diagnostic MRIs - is greater than the cost of end-of-life interventions, and accounts for much of the effective ‘health-scare” tactics, e.g. Grim Reaper Consultations, used by the political opposition.

12. Americans trust their doctors more than data-bearing Government bureaucrats when it comes to their personal health care.

13. Americans do not like government mandates on individuals or businesses that limit care, penalize them, fine them, or otherwise regiment them or restrict their freedom of choice or action.

Easy to be Cynical about American Fears of Government Health System Nirvana

It is easy to be cynical about American naivete about health care as a limited resource and about our proclivity to want everything as individuals rather than paying attention to the overall social good.

To show this side of the social, or perhaps I should say socialistic equation, here is an excerpt from Princeton economist Uwe Reinhardt's July 31 health care blog “ ‘ A Common Sense’ American Health Care Plan.” This is an example of Reinhardt’s potent combination of tongue-in-cheek and sarcastic humor.

The All-American Wish List for Health Reform

1. Only patients and their own doctors should decide what clinical response is appropriate for a given medical condition, even if that response involves unproven clinical procedures or technology.

2. Neither government bureaucrats nor private insurance bureaucrats should ever refuse to pay for whatever patients and their doctors have decided to do in response to a given medical condition. An insurer’s refusal to pay for a medical procedure is tantamount to rationing health care.

3. Rationing health care is un-American.

4. Cost-effectiveness analysis should never be the basis of any coverage decision by public or private third-party payers in health care, for to do so would put a price on human life — which, in America, unlike everywhere else, is priceless.

5. Government should not require individuals to purchase health insurance. Such a mandate would violate the constitutional rights of freedom-loving Americans.

6. Americans have a moral right to life-saving and potentially highly expensive medical care, should they fall critically ill, even if they are uninsured and could not possibly pay for that care with their own financial resources. (Why else would God have created hospitals and their emergency rooms?)

7. Government should stay out of health care. Specifically, government should not control health care prices, nor should it increase its spending on health care, which is out of control.

8. Even small reductions to the future growth of Medicare spending — called “cuts” in Washington parlance — unfairly burden the elderly, along with the doctors and hospitals that serve them and the manufacturers of health products, lest the pace of technical innovation be impaired.

For Americans, Obamacare's DOA boils down to a preference of hackles of capitalism to shackles of socialism, the devil you know tothe devil you don't know, equal opportunity to equal results, individualism to statistical averaging, homogenization, standardization, and Big Brotherism. This may be unrealistic and antithetical to theories of government cost-controls. It is an American belief system at work, and it has anti-Obama consequences.

Thursday, July 30, 2009

Health Reform: Big Wind, Take Small Steps

Yesterday’s national polls, conducted by New York Times/CBS News and WSJ/NBC News, and reported today by their sponsors, The New York Times, “New Polls Finds Growing Unease on Health Plan” and the Wall Street Journal, “Support Slips for Health Plan,” indicate the more President Obama talks up and defends his plan, the more skeptical the public becomes.

This slippage brings to mind two things.

One, the story of the mother who who sent her son out on a stormy day and gave this advice,”Big wind, take small steps.”

Two, one of the main underlying themes of my book Obama, Doctors, and Health Reform (IUniverse, 2009). In the book, I predict incremental reform is likely and big reform will not happen.

Here are passages in the book on the likelihood of incremental versus massive reform.

Page 5

Although President Obama strikes a determined, even combative tone, I place odds for sweeping reform at 30/70 in his first term, but as near slam dunks for immediate incremental changes such as coverage for children, stem cell financing, funding for electronic records, setting in motion a Comparative Effectiveness Institute, and extended Medicaid unemployment benefits.

Page 10

Under President Obama, health reform is coming – fast, ready or not. But in my opinion, reforms will be incremental, but we’ll not see the whole enchilada - universal coverage.

Page 144

What are the ultimate answers to the primary care shortfall? If I knew that, I would be a candidate for a combined Nobel Prize in Medicine and Economics. Here are a few evolving development that may offer incremental solutions.

• Government and organized medicine payment reform (read the latter as a new coding system by the reimbursement updating committee of the AMA) that spills over into Medicare, Medicaid, and health plan payments.

• Government subsidies and incentives that ease educational debt for primary care candidates, reward care for primary care in underserved areas, and offer more extensive support of primary care residency slots.

Here are a few evolving development that may offer incremental solutions.

• Government and organized medicine payment reform (read the latter as a new coding system by the reimbursement updating committee of the AMA) that spills over into Medicare, Medicaid, and health plan payments.

• Government subsidies and incentives that ease educational debt for primary care candidates, reward care for primary care in underserved areas, and offer more extensive support of primary care residency slots.

• Federal, state, and health plan support of medical homes with adequate payments for creating these homes and lowering of bureaucratic barriers for physicians wishing to create medical homes.

• Realistic rising of fees for care of Medicare and Medicaid populations to more closely approximate private fees and to end cost shifting now required maintaining viable practices and hospitals.

• Federal, state, and health plan support of medical homes with adequate payments for creating these homes and lowering of bureaucratic barriers for physicians wishing to create medical homes.

Page 160

I would not bet against significant incremental health reform. What might prevent Obama-style helath reform are the economy, the soaring federal budget deficit, the Department of Health and Human Services current $708 billion budget, and 25% of federal spending going to Medicare and Medicaid. But Obama is not one to let billions, even trillions of dollars in deficitsstand in his way. He will persist, and he will let the government printing presses roll.

Page 221 -

Physicians on the ground prefer incremental changes through expanding coverage through tax incentives and market-driven changes rather than through a single-payer system.

Page 269

Self: Is there any way to fix the system?

Alter Ego: 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 by testing and rejecting 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.

To sum up, big wind, take small steps.

Wednesday, July 29, 2009

AARP Members Air Doubts about Obamacare

Prelude: From the start, AARP has been in bed with Obama’s health care plans. The basic AARP belief is that we ought to expand Medicare to cover the 50 to 65 year old crowd, which now make up a big slice of AARP membership. But there’s a problem. Obama has vowed to cut $246 billion out of Medicare, and this will likely come out reducing access to high ticket items like cataract surgery, cardiac bypass, heart stents, and joint replacements – those medical procedures that keep middle-aged weekend warriors feeling and acting young. President Obama has some ‘splainin’ to do.

Here is Janet Adamy’s explanation of what’s going on in AARP in the July 29 Wall Street Blog.
WASHINGTON -- President Barack Obama on Tuesday sought to reassure senior citizens that squeezing billions of dollars from Medicare spending won't hurt their benefits. He also defended a proposal aimed at encouraging Americans to make plans in advance for end-of-life medical care.

Wringing savings from Medicare, the federal health-care plan for the elderly, is key to lawmakers' efforts to cover the roughly $1 trillion cost of expanding health insurance to nearly every American. The House version of health-care legislation.
Concerns from seniors about possible benefit cuts are forcing the big seniors' group AARP, which supports the House bill, to walk a tightrope as it tries to keep members on board.

Carolyn Engers from Joliet, Ill., told the president that she had just come from an AARP meeting where seniors said cuts to Medicare spending rank as one of their top concerns. "Even if I decide when I'm 80 that I want a hip replacement, am I going to be able to get that?" she asked.

Mr. Obama said the Medicare cuts will be targeted at wasteful spending, such as overpayments to insurance companies that participate in private Medicare plans, as well as unnecessary hospital readmissions.

"Nobody is talking about cutting Medicare benefits," Mr. Obama said.

But taking such steps is easier said than done, and faces resistance from the powerful insurers' lobby. In addition, some analysts say that reducing reimbursements may drive doctors out of the Medicare program and reduce access to services.

"Cuts to providers, if not well-designed, can have a negative impact on seniors if it means those providers may not accept Medicare patients," said Jack Hoadley, a research professor at the health-policy institute at Georgetown University. Whether that happens will depend on how the final bill is executed, he said.

AARP has been a vocal supporter of President Obama's push for a health-care overhaul, and the White House has cited the group's endorsement as a milestone.
The proposals in Congress contain several perks for seniors. Lawmakers plan to help close a gap in the Medicare prescription-drug benefit that forces seniors to pay thousands of dollars out of pocket if the cost of their drugs falls between $2,700 and $6,154 a year.

The health bills also would bar insurance companies from denying people insurance if they have a pre-existing condition, and curb insurers' ability to charge older Americans more for coverage. Those represent big improvements for Americans ages 50 to 64, who aren't old enough to qualify for Medicare and face high prices and heavy restrictions when they try to buy insurance on their own.

The group faced stiff resistance from members concerned about changes in their insurance when it supported President Bill Clinton's 1993-94 effort to overhaul health care, and it suffered an embarrassing rebellion from seniors when it supported a plan to expand catastrophic health-insurance coverage in the late 1980s.
That has prompted AARP to invest more this time in explaining the legislation early on to its 40 million members, said John Rother, executive vice president of policy and strategy.

Also at Tuesday's event, President Obama defended a proposal in the House health bill to provide Americans with end-of-life planning consultations and other provisions aimed, in part, at reducing the cost of caring for people near death. Republicans call the proposal evidence that the government wants to interfere with personal medical decisions.


Prelude: Many consider the Massachusetts universal health plan, now three years old, as the forerunner to Obamacare. If so, hold onto your wallets. It costs more, raises taxes, is unaffordable to more, floods emergency rooms, lengthens waiting lines for doctors, and only one in four consider it a success. And, in the end, it has shown , the only way to control costs inside a bureaucratic structure is to cut doctors' pay, transfer patients into managed care, impose government global budgets and introduce price controls. The Bay State, in other words, has shown us how not to reform health care.

Here is Sally C. Pipes' account of the Massachusetts Mess in the July 29 Fortune. She is president and CEO of the Pacific Research Institute. And author of The To Ten Myths of Health Care

"Will Commonwealth care cost taxpayers more? No!" So wrote Massachusetts Gov. Mitt Romney in November 2004, the economy then still in full bloom. "Neither the state nor the taxpayers can afford to pay more."

It's worth pondering ex-Gov. Romney's promises just over three years after he crossed partisan lines to reform health care in the Bay State. The Obama administration and congressional Democrats are modeling reform on the Massachusetts model, promoting bureaucratic health exchanges, increased restrictions on health insurance and vastly expanded taxpayer-subsidized care. Like Romney, they promise more coverage at lower cost, even as the evidence suggests otherwise.
So how's health in Massachusetts? People are not pleased, according to a recent poll. Only one in four considers the reform a success. Just one in five thinks it has made health care more affordable.

Romney marketed the plan as a private solution. Yet it's a massive expansion of taxpayer-subsidized care. Medicaid has increased by 76,000 enrollees and the subsidized plans by 177,000. Forty-six percent pay no premium, and another 12% are highly subsidized. Only 19,000 have signed up for the much-touted non-subsidized private plans offered through the Commonwealth Health Insurance Connector.
And it comes at a steep cost. Residents are expected to spend as much as 10% of their income on premiums or face fines.

The big lie in Massachusetts was that costs and taxes would not increase. "Health insurance for all our citizens does not require new taxes," declared Romney on the eve of the bill's passage in 2006.

The government's expansion has cost taxpayers far more than projected. Premium inflation in the state has not been muted by the increase in the number of insured residents, and politicians are scrambling to fund the program. Smokers got hit for $1 a pack in July 2008.

At the federal level, it's a foregone conclusion that new taxes will fund the expansion. The lies are in just how many new taxes will have to be imposed, existing ones increased or trillions of dollars in federal debt issued.

It could be the bait-and-switches that have Massachusetts residents cranky. They were promised affordable coverage. The plans were so expensive that 20% of the uninsured were exempted from having to purchase them.

They were told the plan would provide near universal coverage. But not everyone is insured. Even the most optimistic estimates put the uninsured at nearly 3%. To cut costs, the legislature cut thousands of legal immigrants from the program and will quit automatically enrolling all eligible people.

Bay Staters were told they wouldn't have their current arrangements disrupted. Yet thousands of residents have had to purchase more expensive coverage after the new bureaucracy deemed their existing plans inadequate.

Much was made of the young "invincibles," the free riders on the system who transferred costs to the privately insured and clogged up emergency rooms for non-urgent care. It was money that had been spent on them, so Romney and others claimed, that would fund new, more efficient insurance. Yet three years in, the successor uncompensated care pool is still spending hundreds of millions of dollars. Emergency rooms are more crowded than ever.

This was predictable and predicted, as the largest users of emergency rooms are Medicaid patients. The largest categories of spending from the old uncompensated care pool were for mentally ill substance abusers--not exactly the folks that rush out to purchase insurance on threat of a fine.

Whether Romney believes his hype is unknown. There can be little doubt that his Democratic partners, including Sen. Edward Kennedy, D-Mass., viewed the Massachusetts experiment as a "no-lose" proposition. If it somehow worked, great. But if the scheme failed, Democrats understood that they would have moved the state one step closer to government-run health care, with thousands more hooked on subsidized coverage.

Indeed, Jon Kingsdale, the person in charge of the Health Insurance Connector, recently wrote that it is a better strategy to expand access first, let costs run and only then worry about containing spending.

This lesson too is being applied at the national level. Peter Orszag, who spent years fretting about budgetary expansions while at the Congressional Budget Office, is more flexible in his new role as President Obama's budget director. "I think it's important for those of us wearing the green eyeshades to take them off," he told Slate.

In the end, the only way to control costs inside a bureaucratic structure is to cut doctors' pay, transfer patients into managed care, impose government global budgets and introduce price controls.

And that's exactly what Bay State leaders have announced they'll do. Last week, a state commission recommended that the government stop paying health care providers for each procedure and instead compensate provider networks with a flat fee per patient. Of course, such a system of global payments, or "capitation," encourages provider groups to skimp on care, as they get to keep as profit any money not spent treating patients.

If congressional Democrats get their way, every American can look forward to a similar system of capitation in the future. This would upset the care of 85% of Americans who are currently insured and greatly increase government control. Exactly the results Democratic leaders assure can't possibly happen.

Orzag's Bad Idea - Ending Practice Variation

Prelude: The Obama team, and its main Budget man, Peter Orzag, are fixated, indeed, obsessed, with the Dartmouth Group’s idea that if you could reduce Medicare spending in the high spending regions to the level of the low spending regions, you could save the system 30% or $700 billion, which is not chicken change. The problem is, is you examine the matter closely, it doesn’t make any sense- given the mix of the rich and the poor, the vast differences in socio-economic status, and the supply-demand diequilibrium in the various regions.

Here John Goodman, the economist who founded the National Center of Policy Analysis, has his go at destroying the Orzag thesis.

In the course of his analysis, Goodman observes HR3200, the House Bill, uses the words "require," "report," "limit," "penalty," and "regulation" a total of 1335 times and the words "competition" and markets" only 6 times. This word use reflects a 99.6% bureaucratically locked mindset. It leaves little room for freedom of doctors to act or innovate.

I'm in favor of a Medicare Czar with complete authority to form contracts with providers. And no ability of Congress to override the decisions. But as I explained at the National Journal blog on Monday, I'm 100% against this idea if Office of Management and Budget Director Peter Orszag is the Czar.

I like Peter. He's smart. He's capable. He's competent. But his idea on how to reform Medicare is completely wrong. As the CBO has affirmed, it will save no money. Zip. Zero. Nada. And it may harm patients.

The Claim

But first things first.The Claim. Researchers at Dartmouth have documented wide disparities in Medicare spending that appear to have no impact on health outcomes. Further, if doctors and hospitals across the country practiced medicine as efficiently as the lowest spending regions, it appears that as much as one-third of Medicare's outlays could be saved. Orszag has generalized these findings for the health care system as a whole and concluded that national health care spending could be potentially reduced by $700 billion a year.

The Evidence

NCPA Senior Fellows Andrew J. Rettenmaier and Thomas R. Saving (also a former Medicare Trustee) have examined data from the Centers for Medicaid and Medicare Services in a Brief Analysis the National Center for Policy Analysis is releasing today [full study here]. Their initial results confirm the Dartmouth findings:

• Medicare spending per enrollee for residents in the five highest-spending states is about 40 percent higher than spending in the five lowest-spending states.

• Further, if every state were as "efficient" as the fifth lowest-spending state (that is, achieved the 10th percentile), Medicare spending could be reduced by about 25 percent.

However, when Rettenmaier and Saving looked at total health care spending they found that high Medicare spending often occurs in places where private sector spending is low, and vice versa. For example:

• Although Texas is fifth from the top in Medicare spending per capita, it is seventh from the bottom in per capita spending for the state's population as a whole.

• California is 11th from the top in Medicare spending, but eighth from the bottom in spending overall.

• North Dakota is seventh from the bottom for Medicare, but 11th from the top in overall spending.

These results are consistent with the idea that cost shifting between the public and private payers is at play, although there may be other explanations as well.
There are also other factors that affect differences in spending, including income, age, race and various characteristics of state economies. After adjusting for these factors, the authors ask and answer this question:

Suppose that we could transform the practice of medicine all across the country and induce doctors everywhere to practice medicine the same way it is practiced in the fifth lowest-spending state (10th percentile). Based on the experience over a 15 year period, the potential savings across all populations is only about 5 percent!
Bottom line: After all adjustments are made, the potential savings are quite meager. They are probably smaller than what purchasers would have to spend to try to realize them.

Case Study: McAllen, Texas. An article in The New Yorker by Atul Gawande singled out this Texas border city as one of the worst examples in the country of unjustifiably high Medicare spending. Yet as Greg Scandlen has previously pointed out at this blog, McAllen is a poor city with many health problems and very little private insurance. So Medicare is the only reliable source of much needed funds. Like much of the rest of Texas, it appears that McAllen is overbilling Medicare in order to subsidize the lack of funds from other sources. Overall, McAllen is not a high spending area at all. The city is much more of an example of cost shifting rather than inefficient medicine.

Islands of Excellence. None of this suggests that there is no fundamental problem. With consumers paying out-of-pocket no more than 13 cents out of each dollar they spend, it would be impossible not to have an enormous amount of waste and inefficiency in health care. And, as is the case with education, there appears to be a sea of mediocrity punctuated by islands of excellence — distributed here and there almost randomly. Dartmouth research suggests that if everyone went to the Mayo Clinic for his health care, the nation would reduce its health spending by one-fourth and quality of care would go up. If everyone went to Intermountain Healthcare in Salt Lake City, the nation would reduce its spending by one-third and quality would improve in the process.

Problem is, not everyone can go to Mayo. Nor do we know how to replicate Mayo. Even Mayo doesn't know how to replicate Mayo. And if we try to use the power of the purse to force other institutions to operate like Mayo, we could cause a lot of harm.
Supply-side versus Demand-side Changes. Everything that Peter Orszag is talking about and everything that is incorporated in legislation before Congress takes a demand-side approach. It seeks to use the purchasing power of the federal government to force doctors to change how they practice medicine. The National Taxpayers Union reports that:

• The House bill has the word "require" and its derivatives 494 times.

• It uses "report" 427 times, "limit" 167 times, "penalty" 156, "regulation" 91.

• By contrast, the words "marketplace" and "competition" are used 3 times each.

As I have argued here and here, what is needed is a supply-side approach — one that liberates doctors rather than seeking to order, manipulate and control them.
Lessons: There are many examples in our health care system of high-quality, low-cost care. They all originated on the supply side of the market. Not one of them was created by Blue Cross, Medicare, or any other payer.

Why can't we learn from this experience? Let the providers tell Medicare how to reform the system rather than the other way around. As proposed on my recent testimony, every provider should be encouraged to repackage and reprice his services, provided that (1) the cost to the government does not go up and (2) quality of care does not go down.

I'm in favor of a Czar who is willing to liberate the supply side of the market. I'm not in favor of a Czar who wants to tell doctors how to practice medicine.

An Interview on Royal Dutch TV

Yesterday a Dutch television crew, consisting of senior correspondent Willem Lust and his wife, conducted an hour-long television interview with me in my home about the likely fate of President Barack Obama’s health reform initiative.

The Lusts are on a 3 or 4 year assignment in the U.S. to follow trends and to instruct their Dutch audience about the ways of America. They have travelled to 48 states. They operate out of New York City and have been busy following the U.S. presidential campaign, its political aftermaths, the economy, and now health care, which is, of course, the hottest political topic of summer.

Why me? Willem said he found me on the Internet, Apparently he googled health reform, and I rose to the top of the pile.

I won’t dive too deeply into the specifics on the interview, except to say I predicted President Obama’s health proposals were in trouble, thanks in no small part in failure of the American economy to respond to the vaunted stimulus package, skepticism generated by the bad economy, growing unemployment, mounting federal deficit, and cultural obstacles posed by the American culture and the inherent complexities of U.S. medical industrial complex, the only growing part of the economy.

I told the Lusts that I admired the Dutch health system, which I have written about (see below). In essence, since January, 2006, the Netherlands has provided universal coverage through competing private plans with premiums adjusted for age, health, and disease. All Dutch citizens must buy coverage. If they can’t afford it, government subsidizes their premiums. It all seems to work pretty well, as indicated in this blog.



Should the U.S. Health System “Go Dutch?”

To “Go Dutch” means paying one’s own expenses. Two reasons the new Dutch health system these days is attracting so much attention are 1) It obligates Dutch individuals to buy or pay health care premiums. 2) It resembles the universal coverage plans now underway in Massachusetts and California.

Besides, this tiny densely populated country of 16.6 million, which rescued itself from the sea though a massive national engineering project and is home of three of world’s largest companies – Royal Dutch Shell/Shell Group, Royal Phillips Electronics, and Unilever, has shown itself capable of organizing and administering huge social and business enterprises. Why not health care too?

System Comparisons

Here’s how the three plans – Dutch, Massachusetts, and California compare.


Netherlands, 16.6 million, Massachusetts. 6.5 million, California, 36.5 million

Date Started

Netherlands, Jan. 1, 2006, Massachusetts, Last year, California, proposed but stalled in legislature.

Individual Citizens

In all three plans, each individual citizen must buy or pay premiums.


Netherlands, must offer coverage to all, in Massachusetts, may limit coverage for pre-existing illness, In California, must offer coverage to all.


Netherlands, don’t need to offer coverage, Massachusetts. must offer coverage, California, must offer coverage or pay penalty

Idea Behind Dutch Plan

The idea behind the Dutch plan is to offer private coverage for all, but to put a lid on costs. Last year, under the plan, health costs dropped from 4.5% to 3.0% versus the drop from 8.0% to 6.1% in the U.S. In the Netherlands, all adults must buy, and all insurers must offer premiums, no matter what the pre-existing illness, though premiums for high risk individuals are adjusted for “risk equalization.” Insurers are expected to compete on premiums, consumers will be told real costs, and hospitals will be pushed to lower costs.

More Detail

Here’s more detail on Dutch plan, which took 4 years to develop.

The new system has the following characteristics:

• All individuals must be insured.

• All individuals purchase health insurance on the private market.

• Individuals can choose to get their health insurance through their employer–if the option is available–but the employer doesn’t have to offer health insurance. If the employer does not offer health insurance or if an individual is unemployed, then they must purchase insurance on the private market.

• Health insurers are free to charge each individual any price they please for health insurance. Of course, market forces limit the price that the insurers can charge the consumers before they switch to another plan.

• The cost of health is more transparent to consumers since they see the price they are charged for health care.

• The state subsidize health insurance. “Insurers get risk-equalization payments for patients with about 30 major diseases.” Thus, people who are sicker receive a larger state subsidy than healthy individuals.

How the Dutch View Their System

You might be interested in how the Dutch look at their new system. Here is how a report from the University of Leiden on how the Dutch see themselves.
Overall, the health care system the Netherlands is of a good quality. It is a mix of public and private, whereby the government closely monitors private activity.

Waiting lists

Unfortunately, we have a shortage of doctors and specialists. This means patients may have to wait a long time for treatment.

On top of this, there is also a shortage of general practitioners (GP's). Generally, you can only see a GP by appointment (unless there is a an emergency, of course!).

Where to find a GP/dentist

In the Netherlands, it’s normal to have your own GP and dentist. General practitioners can be found in every town and city. Dentists are to be found in almost all cities.

Every big town has at least one hospital. Specialists are usually employed by hospitals.

Please note that you should first contact your GP before going to the hospital.


In general, Dutch doctors are reticent about prescribing medications. The theory is that, if the patient is a healthy person, the body will fight the disease itself.
So, do not be surprised that they will not prescribe penicillin if you have a cold.


Dutch health care is very expensive. Therefore, it is essential to have a good medical insurance. In fact, medical insurance is required by law. Make sure you read all the rules that would be applicable for you, especially if you are considering to take a part-time job.

Will the Dutch System Work in The U.S?

Matthew Holt, a well-known health analyst who worked closely with Alain Enthoven, the mastermind of “managed competition, “ the Clinton plan that bombed in 1994, thinks so.

Here are a few things he has to say in his September 7 blog, which followed a favorable WSJ report entitled , “In Holland, Some See a Model for U.S. Health Care System, Private Insurers Compete, But All Get Coverage.”

“The Netherlands is probably has the most advanced health care financing system in the world.

How so? It's essentially Enthoven's original managed competition idea in action (circa 1987). Even the Wall Street Journal thinks good things. The key is you need to ban underwriting, and implement risk adjustment (not that it's easy but it is doable) between plans. Then you have to give the insurer and the insured incentives to realize that the way that population health is managed has ramifications for both the population's health and its wealth. Then you get rational trade-offs made at a population level.

Can it happen here? I think so, unless you think that Americans cannot handle rational choice. Of course the people who claim to value choice in health care here can't abide by the concept of the rational structure that the Dutch have put in place which allows choice to be made about the right things.

My Opinion

What do I think? Not in its entirety, not everywhere in the U.S., and not soon. We’re much more heterogeneous than the Dutch. We’re have nearly 20 times more people. Managed competition has already failed once, having crashed in 1994. Besides, under the Dutch plan health plans control physicians and consumers. Dutch doctors, by the way, vigorously opposed the current plan. It may be a market in terms of health plans, but it’s not a true market for doctors and consumers.
Still I find the Dutch plan interesting in that it may conceptually gets America conservatives over the hump that all single payer plans are run by faceless bureaucrats in a centralized, all- powerful centralized command-and-control centers without any sense of markets.

The Dutch plan contains some solutions. It offers choices of hospitals and doctors. Consumers now know what things cost. Private health plans compete. The U.S, has to get over the ideological notion that all universal coverage plans represent “socialized medicine,” conducted in gray government buildings, without third parties, without choice, without access to the latest technologies, and in process leveling rather than elevating care.

Maybe, in the end, we’ll find the right formula for ensuring access, maximizing access to the best, and moderating costs. Maybe, as Winston Churchill noted, “You can always trust the Americans. In the end, they will do the right thing, after they have exhausted all the other possibilities.” I hope so.


On Jan. 1, 2006, after 4 years in the making, the Netherlands, a nation with a population of 16.6 million, implemented a new health system requiring all individuals to buy or pay health premiums, private insurers to offer coverage regardless of pre-existing illness, premiums to be adjusted for risk, consumers to be made aware of costs, and not requiring employers to offer coverage. Since the plan’s inception, health inflation has ebbed from 4.5% to 3.0%, compared to a drop in the U.S. from 8.0% to 6.1% over the same period.

Will America “Go Dutch”? Not soon, in my opinion, because of the U.S.’s diversity, our regional differences, our partisanship, our size (land mass and population), our distrust of private health plans, and our preference for consumer and physician market competition. But the Dutch plan shows European governments can be innovative and aren’t averse to private competition.

The Fat of the Land

Obesity is a mental state, a disease brought on by boredom and disappointment. Imprisoned in every fat man a thin man is wildly signaling to be let out.

Cyril Vernon Connolly, 1903-1974, The Unquiet Grave, 1945

It’s official now. The Center for Disease Control has declared war on Obesity. Small wonder. Obesity is now one of the ten leading causes of death.

Here is the situation, as expressed in a July 29 Wall Street Journal Blog,

The medical costs of treating obesity-related diseases may have soared as high as $147 billion in 2008, the Centers for Disease Control and Prevention said Monday, as its new director set a fresh tone in favor of more aggressively attacking obesity.
The cost of treating obesity doubled over a decade, signaling the rising prevalence of excess weight and the toll it is taking on the health-care system. The medical costs of obesity were estimated to be $74 billion in 1998, according to a study by federal government researchers and RTI International, a nonprofit research institute in Research Triangle Park, N.C.

The findings were released at a conference on obesity held by the CDC in Washington, D.C. The prevalence of obesity rose 37% between 1998 and 2006, and medical costs climbed to about 9.1% of all U.S. medical costs, the researchers said.
Obese people spent 42% more than people of normal weight on medical costs in 2006, a difference of $1,429, the study found. Prescription drugs accounted for much of the increase.

The numbers underscore the urgent need for deeper interventions in society and the environment that will make it easier for people to maintain normal weight, Thomas Frieden, the CDC’s new director, told conference attendees. While obesity rates among some population groups have shown signs of leveling off, that is of little comfort, he said: The average American is about 23 pounds overweight. Obesity is causing disabilities and exacerbating health disparities, he said. The average American consumes about 250 calories more a day now than two or three decades ago.
“Obesity and with it diabetes are the only major health problems that are getting worse in this country, and they’re getting worse rapidly,” he said.

Change is needed on many fronts, he added. “Reversing obesity is not going to be done successfully with individual effort.”

Conducting War on Obesity

But how do conduct a war on obesity?

• Do you tax fast junk food, sweet beverages, candy, and sugar-laden processed foods more heavily?

• Do you label all foods with stark warnings and compelling information about the dangers of obesity?

• Do you conduct a national publicity campaign informing the public of the health dangers of obesity? Do you warn of the dangers of developing diabetes, heart disease, and osteoarthritic knees? Do you teach everyone how to calculate their body mass index (BMI), and if its ever 30, tell them they're fat ant eat less and exercise more?

• Do you promote the virtues of bariatric surgery, which is effective and which may render morbidly obese diabetics non-diabetic?

• Do you launch a nationwide campaign of weighing school kids, measuring their BMIs ( Body Mass Indices), and taking steps in public schools to reverse childhood obesity, such as re-introducing recess?

• Do you identify those who are likely to be become morbidly obese (more than 100 pounds overweight? In percentage terms, these include all women (6.30%) and non-Hispanic women (15.10%).

• Do you try to wean or pry people loose from television, computers, Ipods, and cars?

• Do you distribute pedometers to sedentary populations, as you might distribute condoms to the sexually active?

• Do you publicize people like Governor Huckabee, a formerly morbidly obese individual who lost more than 100 pounds and became an presidential candidate?

• Do you frown on people like Regina Benjamin, MD,an obese physician who President Obama recently appointed Surgeon General?

• Or do you simply offer sympathy, empathy, counseling, and emotional support to the obese?

In the end, it comes down to this simple question: How do you stop people from digging their premature graves with their own teeth? in other words, how to you help those thin people get out of their those fat bodies?

Tuesday, July 28, 2009

It's Not Simple Being An American

Amid all the rhetoric about health care reform, one claim has emerged as a trump card designed to preserve the carrent patchwork of private and public insurance and to stop discussion of a government- sponsored Canadian-style Medicare-for-all system – is antithetical of “American values
.' ”

Allen S. Brett, MD, University of South Carolina School of Medicine, “ ‘American Values’ – A Smoke Screen in the Debate on Health Care Reform," New England Journal of Medicine, July 30, 2009

I respect the New England Journal of Medicine. I am a life-time subscriber. You can always count on the Journal. In its "Perspective" section and its editorials, the Journal always comes down on the side of single-payer, universal coverage, sweeping reforms, and the passel of priorities that come with government-based reform – comparative effectiveness research, data-driven physician controls, herding doctors into salaried groups, minimizing regional practice variation, and ending “waste” and “unnecessary interventions.”

The "Perspective" articles are well-reasoned, well-edited, objective, and are generally written by academics or policy wonks of impeccable reputations.

And like clockwork, the articles reach the same conclusions – government has to do something- anything- to fix our “broken” system and bring independent private practitioners to heel. What we need to do is save money by preventing disease, tracking doctor performance through ubiquitous EMRs, and coordinating care. By doing so, we could homogenize and standardize care and achieve 30% savings – the 30% being an oft-repeated loose estimate by the Dartmouth Group.

The only problem with this argument is that the American people and American doctors aren’t buying. These Americans have the audacity to believe America is an exceptionalist nation of individuals, capable of choosing the doctors, health plans, and treatment.

This freedome of choice may be a silly notion. Americans perisist in believing they are the “The Shining City on the Hill,” as Ronald Reagan used to say. It may be that we are egotistical and too caught up with ourselves in thinking America and Americans something special, a cut above the rest of humankind with spcial opportunities to offer immigrants that flock to our shores.

It may be, as Archibald McLeish,the famous poet, said in 1940 in The American Cause, “Races don’t bother the Americans. They were something a lot better than any race. They were a People. They were the first self-constituted, self-created People in the world.”

But despite Doctor Brett’s objections to the concept of "American Values,", there is something called the “American Culture.” Our health system is a creature of our culture. When asked what Americans believe, Garry Orren, a professor of political science at Brandeis, who polls for the New York Times and the Washington Post, said, “A good place to start is to remember we are pro-democracy and anti-government. It comes down to ideas that are essentially ant-authority and tend towards self=regulation. If there is an American creed, I think it might begin.

One, government is best that governs least.

Two, majority rule.

Three, equality of opportunity.”

That seems about right to me. It explains why Americans prefer local health solutions, why we reject federally-mandated universal coverage with rationing, why we feel capable of making our own health care decisions, why we seek equal opportunity access to high technologies, why we prefer pluarilistic payments systems, whey we allow marke-based and public-based isntitiutions to co-exist and compete, and why we permit doctors to behave democratically, seeking their own locals to practice, often ativing independently of hospitals, health plans, and government, and making their own deicisonns, free of the fetters of outsiders.

Democracy is a messy business. That’s the way Americans like it. It allows choice, freedom, and individualism. Each of us feels we are a person, not bound the rules of statistical averages, as dictated from Washington.

Sunday, July 26, 2009

Roses Are Red, Violets Are Blue, Blue Dogs Do, What They Have to Do

When history is writ, liberal Democrats and Obama followers will look back and thank conservative Blue Dog Democrats. For what? For saving the left from its worst instincts – reflexing lurching left in full Bush whacking mode. Health care is Obama's issue, not Bush's.

The Blue Dogs are doing what they have to do – swinging towards the center so save their re-election chances in November 2010. The full House will be up for election, and many Blue Dogs come from swing districts where they unseated Republicans. Traditionally the party out of power regains seats, and Republicans may do so with a vengeance if the stimulus fails, deficits climb, unemployment continues, and health care falters. Democrats stand to lose big in conservative districts concerned about the huge Federal budget deficits, and in liberal wealthy districts perturbed by the onerous surtax on millionaires.

The Blue Dogs know the U.S is a center-right country. Most Americans prefer incremental to radical change; demand prompt access to the latest medical technologies; like to make their own health care decisions rather than depend on government. hate the thought of waiting in line for care and being denied treatment want to pick their own doctors; like their own private plans and fear giving them to some public plan.

These citizens are skeptical of such things as comparative effective research, which they suspect is denial of care for the elderly in disguise; bundling of care to do away with fee-for-service, which may be more about bureaucratic bungling than bundling.

Moreover, Blue Dogs know Americans loathe uncertainty, and uncertainties are in the air, as liberal activists try to rein in Blue Dogs. But Blue Dogs are barking back. The Dogs want four questions answered: one, what are the details of Obamacare; two, how are you going to pay for it; three, where is the solid evidence you’re going to save any money; and four, what sacrifices are my constituents going to have to give up to make Obamacare a reality? Will they, for example, have to give up cataract, joint, and heart surgery - the three leading Medicare cost items - because they are too old to qualify?

So far the Director of Office of Management and Budget, Douglas W. Elmendorf, is not impressed the Obama teams promises to save money through prevention, universal EMRs, or primary-care based care coordination. These savings, he says, are more likely bend the cost curve upward by $253 billion, not downward. Nor is Elmendorf impressed by the argument that Obama could appoint an “independent” Medicare Advisory Council recommendations “as approved by the President.” This is interpreted by some as grab for executive power.

I keep hearing the argument that the Obama team and the Blue Dogs have agreed on 80% of the principles and that only 20% of the details need to be worked out – grimy little details like how much is this 10 year reform effort cost, how many uninsured will it cover, and what freedoms are my constituents going to have to sacrifice.

Rhetoric has carried Obama as far as it can. Now is the time for realities.

Saturday, July 25, 2009

Common Sense and Perceived Loss of Health Care Freedoms

I think the plan is being slowed and may well be stopped not by ideology, or even by philosophy in a strict sense, but by simple American common sense. I suspect voters, the past few weeks, have been giving themselves an internal Q-and-A that goes something like this:

Will whatever health care bill is produced by Congress increase the deficit? “Of course.” Will it mean tax increases? “Of course.” Will it mean new fees or fines? “Probably.” Can I afford it right now? “No, I’m already getting clobbered.” Will it make the marketplace freer and better? “Probably not.” Is our health care system in crisis? “Yeah, it has been for years.” Is it the most pressing crisis right now? “No, the economy is.” Will a health-care bill improve the economy? “I doubt it.”

Peggy Noonan, “Common Sense May Sink Obamacare,” Wall Street Journal, July 24, 2009

Is American common sense sinking Obamacare? Maybe. My own sense is that health care has taken a back seat to the deficit, the economy, unemployment, and the sense that the stimulus has fallen flat. But , as details of Obamacare surface, and as people dive into the weeds of the proposals, people are getting the sense that Democratic proposals threaten health care freedoms.

According to Shawn Tully, editor at large for Fortune, who has read the 2000pages tortured legalese of HR3200 and the Senate proposal of Senator Kennedy’s Health Committee, these freedoms include,

1. Freedom to choose what’s in your plan.

The reason? The federal government will impose a minimum list of benefits that private plans will have to offer through “qualified plans” offered by health care “exchanges,” or some public option.

2. Freedom to be rewarded for healthy living, or to pay for your real costs.

Reasons? One, The proposals force all patients to pay the same rates, the so-called Community Rating, regardless of age or clinical condition,thereby gouging the young and healthy and making them pay the same as the old and sick. Two, the proposals force insurers to pay the same rates for all customers, regardless of risks and medical costs, thereby threatening their very existence as viable businesses.

3. Freedom to choose high deductible coverage.

This is a biggie. The bill would eliminate HSAs and high deductible plans, now owned by over 10 million Americans, and the fastest growing part of the private insurance market. This would deprive holders of these accounts and the freedom to spend their money, choose their own doctors, and set aside tax-free money.

4. Freedom to keep your existing plan.

Another biggie. Existing plans cover 253 million Americans, and more than 80% say they are pleased with their plans. To be sure, the proposals give ERISA employers that are self-funded, which include America’s large corporations, a five year grace period, after which employers would be compelled to offer “federally qualified" plans; ditto, for small businesses, which would be forced to offer “qualified plans,” Should existing plans change anything that might help them stay in business, small businesses would have to drop their existing plans and shop through the federal exchanges.

5. Freedom to choose your doctor.

Huge for those Americans who think they have enough good sense to pick their own docors. The Senate plan will require Americans to buy through exchanges and to get their care through “medical homes,” where you’re assigned a primary car ephysicians who will control your access to specialists and who will decide what services, liked MRIs or medical services, are most cost effective.


The Fortune editor concludes, “The best solution is to move towards a let-freedom ring regimen of high deductibles, no community rating, no standard benefits, and cross-country shopping.” This may not make sense to command and control central planners, but it seems to make common sense to most Americans who enjoy their current freedoms.

Hospitals and Doctors - Doing Away with Fee-For-Service and Putting Doctors on Salaries

Doctors in the United States are usually paid fees for each service they provide. The more procedures and tests they order, the more money they pocket. There is widespread agreement among health policy analysts that many of these procedures are unnecessary, raising costs in ways that often do nothing to improve patient health.

By contrast, Bassett — like the Cleveland Clinic and a small number of other health systems in this country — pays salaries to all of its doctors. No matter how many tests or procedures are performed, they take home the same amount of money. Medical costs at Bassett are lower than those at 90 percent of the hospitals in New York, while the quality of care ranks among the top 10 percent in the nation, surveys show.

Everyone knows that the Bassett model is the right model,” said Senator Charles E. Schumer, a New York Democrat involved in negotiations over health care legislation. “The question is, How do you get from here to there?”

Gardiner Harris, “Salaries for Doctors, Not Fees, New York Times, July 24, 2009

Not everyone, Senator Schumer, including me and payers and patients who pay fees to hospitals who hire doctors on salary.

These days you hear a lot of rumbles – from CMS, Massachusetts health authorities, and analysts and pundits – about ending free-for-service (FFS) for doctors. The presumption is that FFS is negative economic incentive that doctors cannot resist.

Therefore, critics say, it logically follows that practitioners do more, i.e., over treat for financial gain but no gain in outcomes. In reformist jargon, FFS is a “structural problem” – a problem that can be corrected by various means capitation; bundling of fees for episodes of care, chronic disease, or procedures; paying only for what works based on comparative research; health algorithms that eliminate fee variations and place everyone on the same payment playing field, and placing doctors on salaries.

This line of thinking insults doctors by questioning their integrity, as President Obama did the other night when he said greedy doctors would remove tonsils to treat a sore throat.

It ignores the fact that at least 40% and maybe even 50% of doctors are already employed by hospitals, clinics, medical schools, and other institutions without noticeable impact on costs.

And oblivious to the reality that the world at large, particularly small businessmen and independent entrepreneurs, work on the basis of fee-for-service. In other words, FFS is the way the world, and independent professionals – lawyers, accountants, consultants, and others – works.

On Jlu 24, the New York Times carried an article, cited above, on Bassett Hospital, The piece heralded the fact that the doctor-run hospital had placed its medical staff on salaries and that salaries practices removed incentives to do more, and instead focused on how to treat patients without thinking about money. This may be, and it is certainly the message that integrated systems like Mayo, the Cleveland Clinic, Geisinger, and Kaiser like to convey to the world.

And as I write, hospitals are on a hiring binge to hire more doctors on salary. This has its cost downside. The greatest profit margins and the driving force for many hospital marketing programs lie in procedures related to heart, orthopedic, surgery, and cancer care. Hospitals expect their hired doctors to refer patients to these programs rather to independent ambulatory facilities, which often charge much lower fees. In addition, one of the dirty little secrets of the cost equation is that hospitals can legally charge “facility fees, “ which may be higher than doctor fees or other hospital procedure fees. Finally, hired physicians are instructed to send patients to hospital laboratories, x-ray and imaging units, and other hospital services, which cost much more than independent facilities.

The net result of these various factors is that hospital-based employment may significantly raise rather than lower costs, due ironically, to hospital-based FFS rather than doctor-related FFS.

Friday, July 24, 2009

Testing for Cardiopulmonary Insufficiency in the General Population

In my 2007 book Innovation-Driven Health Care (Jones and Bartlett), I harped upon the importance of bottom-up innovations as essential for improving the general health of the population and for detecting costly chronic diseases in their early stages before they progrss or become irreversible. A perfect example of a far-reaching innovation is SHAPE (System of Heart and Pulmonary Evaluation) Medical Systems in St. Paul, Minnesota.

SHAPE modifies the class cardiac treadmill stress test, removes its risks, and adapts it to the general populaton. The SHAPE system, smaller and more portable and less expensive than the usual treadmill test, can be carried out in almost any setting without the presence of a cardiologist.

SHAPE can detect the presence of coronary disease, heart failure, chronic obstructive lung disease, and asthma, which together account of 50% of all health costs. SHAPE is particularly useful for physicians evaluating the common symptom of shortness of breath.

SHAPE has been approved by the FDA, and is now being used in major cardiology clinics, and, as indicated below, has been validated at the Mayo Clinic.

New FDA-Approved Shape-HF™ Cardiopulmonary Testing System Validated in Mayo Clinic Study

All results from a recent Mayo Clinic study validate the measurement accuracy of the Shape-HF™ Cardiopulmonary Testing System. Data collected--including HR, SaO2, VO2, VCO2, Fb, VT, and PetCO2 measurements -- by the Shape-HF™ compared favorably to that of the Mayo Clinic Cardiopulmonary Research System and reflected a tight reproducibility of the results. The Shape-HF™ is a new, non-invasive medical device that assesses heart-lung interaction and ventilation in patients with chronic heart failure and other cardiopulmonary disease.

Minneapolis-St.Paul, MN (PRWEB) July 24, 2009 -- All results from a recent Mayo Clinic study validate the measurement accuracy of the Shape-HF™ Cardiopulmonary Testing System. Data collected by the Shape-HF™ compared favorably to that of the Mayo Clinic Cardiopulmonary Research System and reflected a tight reproducibility of the results.

The Shape-HF™ is a new, non-invasive medical device that assesses heart-lung interaction and ventilation in patients with chronic heart failure and other cardiopulmonary disease.

Shape-HF is the first device to objectively measure cardiopulmonary gas exchange easily and quickly without undue strain on the patient.

The study involved testing 22 subjects simultaneously on the Shape-HF™ and the Mayo Clinic Cardiovascular Research System. Pneumotachs providing air flow to the respective test sytems were connected in series for the tests. The order of the pneumotach for each system was alternated for two test runs separated by 15 minutes of rest. Each subject was tested at rest and as power was increased on a cycle ergometer to 50 Watts, 70 Watts and 125 Watts, with three minutes of exercise at each exercise work rate.

The last 30 seconds of data for each interval for each run was then averaged. The averages of all subjects for rest and the three exercise intervals were then averaged for each run. The average values for each run showed a remarkably consistent parallel and match for all measurements, which included heart rate (HR), oxygen uptake (VO2), carbon dioxide output (VCO2), tidal volume (VT), end-tidal partial pressure of carbon dioxide (PetCO2), oxygen saturation (SaO2), and breathing frequency (Fb). Prior to each test run, the Mayo system was calibrated manually; the Shape-HF™ was calibrated automatically using its proprietary dynamic autocalibration feature that does not require manual calibration prior to testing. A manuscript detailing the study is in development and will be submitted for publication.

Shape-HF™ is the first gas exchange testing device specifically designed for cardiology. It is FDA-approved, easy to use, easy on the patient, and provides clinically relevant data that is easy to understand, reproducible and immediately useful to a cardiologist. Shape-HF™ quantifies the severity of dyspnea on exertion and fatigue and evaluates the interaction between the heart, lungs, and other organ systems. This makes it possible for the physician to evaluate therapy options for the individual patient and track patient progress.

In addition, cardiac resynchronization therapy (CRT) has become a mainstay in treating patients with severe heart failure when alternative treatment options have been exhausted. In addition to being the first and only device that objectively measures cardiopulmonary gas exchange easily and quickly without undue strain on the patient and in the office setting, Shape-HF™ provides real-time physiological assessment to help physicians optimize CRT at exercise levels consistent with patient daily activity. Importantly, Shape-HF testing is cost-effective and easy to use.

Shape Medical Systems Inc. is a privately held, St. Paul, Minnesota-based medical device company whose core technology lies in the development and commercialization of products for assessing heart/lung interaction and ventilation in chronic heart failure and other cardiopulmonary disease.

Shape's clear mission is to develop products that increase the quality of patients' lives by helping doctors quantify shortness of breath, assess patient functional capacity, optimize drug, device and rehabilitation therapy, and monitor patient progress. Shape Medical Systems was founded in 2004 and received FDA market clearance for the Shape-HF™ Cardiopulmonary Testing System in April 2009. The Shape-HF™ System, testing protocols and applications are protected by patent 7,225,022 and other U.S. and foreign patents issued and pending

Wednesday, July 22, 2009

Health Reform: Individual Freedom Versus Government Control

In the last two years, I have written two books: one, Innovation-Driven Health Care, and two, Obama, Doctors, and Health Reform. Both books stress the need and desirability for bottom-up private innovation, not top-down government control, for individual freedom rather than either status quo or government regulation with suppression of creativity and entrepreneurship.

My idea for an ideal patient-centered and doctor-directed system, friendly to both patients and doctors, who, after all, form the central core of the health system and are its reason for being, is this.

Have employers, Medicare, Medicaid, and government come up with a requisite and reasonable sum of tax-free money, probably in the $6,000 to $10, 000 range, for every individual – man, woman, and child - and let the consumer of health services involved spend as they see fit, based on reliable information based on cost and value and quality. To protect against bankruptcy, let each buy health insurance that covers their catastrophic needs based on their income and assets. And let those who do not spend their money in any given year carry it forward into a health retirement account. And let there be a Health Security Commissioner, much like the present SEC, who oversees all of this.

Reconfigure the tax code so everybody can buy health insurance with tax-sheltered money. Create a U.S. version of the universal consumer-driven Swiss health system which provides quality care at a one-third lower cost than ours. The Swiss requires all people to buy health insurance (the poor receive funds to buy insurance, just like everybody else.

The Plan

Here’s the plan, borrowed in part from the writings and books of Senator Tom Coburn of Oklahoma and Professor Regina Herzlinger of Harvard Business School.

1. Provide universal coverage.

2. Require everybody to buy insurance, using tax-sheltered money.

3. To prevent bankruptcy, have insurance cover possible catastrophic events, based on all expenses exceeding some percent of income and assets.

4. Have government subsidize all those who cannot afford to buy in.

5. Let hospitals and providers bundle care as they wish and let them quote their own prices based on published information.

6. Require published data on quality, performance, and outcomes.

7. Risk adjust prices, so providers can make a reasonable profit for caring for the sicker among us.

8. Encourage and incentivize providers to compete by innovating to create delivery systems that insurers will be interested in covering.

This plan is about individual free-market principles instead of government mandates. It encourages innovations to provide more and better care for less. It discourages third party bureaucracies that reward the status quo. It fosters patient-centered and patient-friendly care.

To bring about this ideal system, the job of Congress will be to pass laws that allow you to buy your own insurance, to help create information about cost and quality using health information technologies, and to transfer money to the poor. Senators, representatives and national politicians must stop practicing medicine and get out of the way. They must let well -trained doctors do the doctoring and responsible informed patients do the shopping. We must stop doctors’ work and patients’ choices being dictated directly by insurers and government and indirectly by lawyers.

Obamacare in Danger as Polls Show Lack of Support

It’s nail-biting time for President Obama and Democrats. If polls are any indication, support is rapidly eroding for Obama’s bold plan to cover all Americans at a sustainable cost. On Wednesday night, July 23, President Obama will pull out all the rhetorical stops to convince the American people of the merits of his plan and the unthinkable alternatives.

The Latest Polls

Here are the latest polls, followed by excerpts from a column by David Brook,”The March to Liberal Suicide,” in the July 20 New York Times.

USA/Gallup Poll, July 17-19, 1006 adults

In answer to, Do you approve or disapprove of the way Barack Obama ishandling health care policy? people answered,

• All Americans, Approve 44%, Disapprove 50%

• Democrats, Approve 74%, Disapprove 17%

• Independents, Approve 40%, Disapprove 55%

• Republicans, Approve 11%, Disapprove 86%

This answer was closely tied to how Obama was handling other domestic issues,

• The economy, Approve 47%, Disapprove 49%

• Taxes, Approve 45%, Disapprove 48%

• Healthcare Policy, Approve 44%, Disapprove 50%

• Federal Budget Deficit, Approve 41%,, Disapprove 55%

After 6 months in office, Obama‘s overall 55% approval rating puts him 10th among 12 post-World War II presidents at this point in their presidencies.

AOL News Poll, July 20

Thi is an open-ended, non-scientific poll Among 217,803 to 268,596 AOL News readers, in response to question, do you strongly approve, aomewhat approve, somewhat disapprove, or strongly disapprove of Obama’s handling on these issues.

• Health care, 75% strongly disapprove

• The economy, 75% strongly disapprove

• Unemployment, 74% strongly disapprove

• Federal budget deficit, 84%

• Overall, strongly disapprove 72%

In answer to what do you consider most important issues, responses were,

• Economy 56%

• Federal deficit, 24%

• Unemployment, 12%

- Health care, 8%

Obama's overall job approval rating took a hit. It slipped to below the 60 percent mark for the first time in Post/ABC polling, to 59 percent -- a drop of six points in a month.

Sermo Poll, Sermo is a physician social networking site with over 100,000 participating members

Of 100,000 members, 7557 responded with these opinions on HR 3200, the House of Representatives Pro-Obama health bill.

• Do you support the current House Bill as it is currently written, No, 94%, Yes, 6%

• Does the AMA speak for you in endorsing the House Healthcare Bill? No, 95%, Yes, 5%

• What is the most important issue in the House Bill that must be addressed?

- Limiting 3rd parties and administrations in compromising the doctor-patient relationshis, 37%

- Malpractice reform, 33%

- Limiting NP, Physician Assistants, CRNAs in encroaching on the physician’s role. 8%

- Relieving paperwork and administrative burdens, 7%

Sermo physicians are not necessarily representative of physicians as a whole. The best survey of how physicians feel about the present system is a survey of 270,000 primary care physicians last summer and fall by the Physicians’ Foundation. It revealed deep discontent, widespread demoralization, and profound economic uncertainty. Surveys by the Medical Group Management Association (MGMA) have shown similar results.

As far as health reform goes, physicians in general fear federal bureaucrats will micromanage care, dictate the details of what doctors can and cannot do for patients, and lower reimbursement 20% to 40% as they now do for Medicare and Medicaid patients.


What follows are excerpts from David Brooks column, “Liberal Suicide March,” in the July 20 New York Times,

The Democrats are losing touch with America. The party is led by insular liberals from big cities and the coasts, who neither understand nor sympathize with moderates. They have their own cherry-picking pollsters, their own media and activist cocoon, their own plans to lavishly spend borrowed money to buy votes.
A Washington Post-ABC News poll released Monday confirms what other polls have found. Most Americans love Barack Obama personally, but support for Democratic policies is already sliding fast.

Approval of Obama’s handling of health care, for example, has slid from 57 percent to 49 percent since April. Disapproval has risen from 29 percent to 44 percent. As recently as June, voters earning more than $50,000 preferred Obama to the Republicans on health care by a 21-point margin. Now those voters are evenly split.
Most independents now disapprove of Obama’s health care strategy. In March, only 32 percent of Americans thought Obama was an old-style, tax-and-spend liberal. Now 43 percent do.

We’re only in the early stages of the liberal suicide march.

Every cliché Ann Coulter throws at the Democrats is gloriously fulfilled by the Democratic health care bills. The bills do almost nothing to control health care inflation. They are modeled on the Massachusetts health reform law that is currently coming apart at the seams precisely because it doesn’t control costs. They do little to reward efficient providers and reform inefficient ones.

The House bill adds $239 billion to the federal deficit during the first 10 years, according to the Congressional Budget Office. It would pummel small businesses with an 8 percent payroll penalty. It would jack America’s top tax rate above those in Italy and France. Top earners in New York and California would be giving more than 55 percent of earnings to one government entity or another.

Last week, the administration announced a proposal to take Medicare spending decisions away from Congress and lodge the power with technocrats in the executive branch. It’s a good idea, and it might lead to real cost savings. But there’s no reason to think that it will be incorporated into the final law. The chairmen will never surrender power to an administration they can override.

And so here we are again. Every new majority overinterprets its mandate. We’ve been here before. We’ll be here again.

Tuesday, July 21, 2009

A Book Review: Health Reform: The End of the American Revolution? by Lee Kurisko, M.D., Alethos Press, St. Paul, Minnesota

This is a timely book. President Obama has said repeatedly he would favor a single-payer Canadian type health system if he could ”start from scratch.” He cannot, of course, start from scratch. He must start from the fact that the United States has a capitalistic system based on employer-based insurance since World War II. Canada meanwhile has evolved its own socialistic single payer approach, which varies by Province but covers all Provinces.

Before Americans. the Obama administration, and Congress lunge too far left, they could benefit by reading this book. Its author, Lee Kurisko, MD, a diagnostic radiologist, left Thunder Bay, Ontario in 2001 to practice in Minneapolis, Minnesota. He says he fled to escape the stifling time consuming bureaucracy of Canadian Medicare, to find time to apply his hard-earned skills, and to practice in a country that still offered its citizens the benefits and freedoms of timely access to doctors, hospitals, and modern technologies.

Doctor Kurisko is more than a diagnostic radiologist. He is an apostle of the wonders of imaging technologies, and he is a well-read moral and political philosopher on the relative merits of socialism and capitalism. He is fond of quoting Edmund Burke, Friedrich Hayek, Milton Friedman, Thomas Sowell, Ayn Rand, and other conservative politicians and economists. He is distraught that socialism has failed to deliver on its promises in his beloved Canada and cites a series of anecdotes on the tragedies of rationing and waiting too long or being denied care.

In essence, based on his personal experiences in practicing on both sides of the border, Kurisko is firing a warning shot across the bow of American would-be medical socialists. As I read this well-written and carefully edited book, I was reminded of another book, Continental Divide: The Values and Institutions of the United States and Canada, in which Seymour Lipset (1922-2006), an American based in Toronto for a number of years, who wrote “Americans do not know but Canadians cannot forget that two nations came out of the American Revolution.”

And, inevitably, two relevant quotes of Winston Churchill, an admirer of both Canada and America, came to mind.

· ” The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of miseries.” Let us keep this in mind.

· “You can always trust the Americans. In the end, they will do the right thing, after they have eliminated all the other possibilities.” Let us hope so.

Monday, July 20, 2009

Hospitals and Doctors - On Ending Fee-For-Service Through Bundling

What follows is a WSJ Blog on the Massachusetts Plan to end FFS by grouping doctors and hospitals into networks and forcing them to charge a flat or bundled fee. As I note in my comment on the piece, this is a typical government fantasy – borne in the belief that one can control costs from the top-down.

Mass. Panel: End Fee-for-Service Payments for Doctors

By Shirley S. Wang

One of the much-discussed drivers of the high cost of health care in the U.S. is that doctors are paid for every procedure and test, which gives a financial incentive to provide more and more treatments, even if they aren’t strictly necessary. That system could change drastically in Massachusetts, as the state struggles to pay for its universal health insurance plan.

A Massachusetts commission yesterday recommended that the state shift its payment method from the ubiquitous “fee for service” formula to one where health-care providers would be grouped into networks and paid a flat monthly or annual fee. Here’s the WSJ story.

The goal is to improve care while reducing costs by forcing health-care providers to work within a budget and coordinate care between providers, according to the Boston Globe.

Patients would choose a primary care provider to coordinate care, a model that resembles the “medical home.” But, they may not get all the tests and procedures they want with providers working within a budget and trying to keep costs down. In addition, the plan could fail if the provider payments are too low or not appropriately adjusted for very sick patients, the reason for the failure of a similar attempt to pay doctors that way in the 1990s, notes the Globe.

Many of the important details haven’t yet been determined and enacting the plan — the goal is to do so within five years — is expected to be tough, according to the New York Times. One of the committee’s leaders, state Rep. Harriett Stanley, told the NYT, “It’s going to be a very long haul, but it’s a trip worth taking.”

Comment: As a former Physician Hospital Organization chairman, who, with the help the PHO president, bundled bills for 150 hospital procedures and episodes of care in the early 1990s, I can attest to the fact that bundling is doable in a hospital setting.

We gathered data on hospital costs, brought specialists together and averaging their costs, gave the hospital a 3% discount and the doctors a 10% discount, added hospital and physician costs together, and backed the bundled bill with reinsurance. The hospital and the specialists were satisfied with the bundled bill, but the state’s BCBS organization was not. It preferred to negotiate separately with the hospital and doctors and had a “divide and conquer” mindset.

Trying to extend bundled billing to the medical system at large by including private practices and all ambulatory care settings is a top-down, command-and-control fantasy. It would be capitation, which largely failed outside of California, re-visited with an added layer of impossible to manage bureaucratic complexity. It would be an administrative nightmare and would compel bureaucrats to micromanage individual patient-doctor interactions, to define what constitutes an “episode of care,” to assume minor problems necessarily progress to chronic disease, and to bring innovative private activities under government control.

I would remind Massachusetts officials that among the fastest growing employment sectors, according to the Bureau of Labor Statistics, are: hospitals +3.4%, offices of physicians +4.1%, ambulatory health services +4.8%, and home health care services +8.6%. To try to simultaneously control costs in all of these segments through bundling is futile and harmful meddling.

Before pursuing their fantasy, I would suggest Massachusetts officials consult with Regina Herzlinger of Harvard Business School, who has consistently maintained that the best way to control costs is through consumer-driven care with responsible consumers spending their own tax-free money and providers competing for consumer favor on the basis of price , quality, and value with a modicum of government oversight.

Sunday, July 19, 2009

CONFLICTED: One Word to Explain How Doctors Feel about Reform

Failure is easy to deal with, but what about success?


Never let a crisis go to waste

Rahm Emanuel, Obama Chief of Staff

In the current debate over health care reform, "rationing" has been a dirty word. Meeting last month with five governors, President Obama urged them to avoid using the term, apparently for fear of evoking the hostile response that sank the Clintonsattempt to achieve reform.

Peter Singer, "Why We Must Ration Health Care," New York Times Magazine, July 19, 2009

These days one word book titles about health reform issues are the rage. There is CRITICAL, Senator Tom Dashle’s tome about the need for a single payer system – written in anticipation of his becoming Obama’s man as Director of Health and Human Services. Then there is CATASTOPHE, which expresses Dick Morris' outrage about Obamacare. Finally, there is FREE, a book about free digital services, and CHEAP, a book devoted to discount services.

Soaking the Rich and Not So Rich

Free or cheap health care services financed on the back of the rich seem to be the wish of House Democrats. Soaking the rich also has an irresistable political cachet among Obamanites. Proposed tax increases now approach 52% of income for the very rich, those making $1 million or more, higher than in any European country.

History will judge if punishing the "rich," many of them athletes, entertainers, CEOs and physicians, others entrepreneurs who create new products, employ new people, and serve as the main source of innovation simultaneously rescues the economy and covers the uninsured, or if surtaxes on the rich, i.e. those making more than $250,000, is simply two cheers for socialism.

Prospects for Naming A New Book

In any event, I’ve been mulling what to call a new book on what doctor’s really think about the prospects of Obamacare. OBAMACARE is over-used. Besides I’ve already written a book OBAMA, DOCTORS, AND HEALTH REFORM (IUniverse, 2009).


I’ve even thought of VICTIMS. After all, since World War II, doctors have been the victims of our own success. No social-technologic enterprise exceeds the demand for modern medicine and its success in prolonging life, restoring function, delaying the inevitable, and in America at least, draining the federal and business coffers.

Politically, how does one cut off the money-consuming and money-generating spigot of life-saving and life-prolonging half-way technologies? Obama thinks he has the answers - prevention, electronic management tools, and coordinated care- but the director of the Congressional Office of Management and Budget disagrees and says these tools will not fundamentally change costs of care or "bend the cost curve".

Other One-Word Titles

Because of President Obama’s tactics of rushing a huge, hastily written, sweeping health care bill through Congress without time to debate the consequences, indeed without even time to read and ponder 1018 page bill, physicians are hesitate to endorse it. He has propelled this bill forward in the names of,

- saving the American economy,

- preserving American global competitiveness,

- lowering health costs through savings by investing trillions,

- imposing individual, business, and health plan mandates,

- turning 1/6 of the American economy upside-down to remove a perceived moral blight by not covering the uninsured,

To highlight the Obama views and physician reactions to them, I have come up with these one-word titles for my new book.

• STAMPEDE, STEAMROLLER, BULLDOZER - These titles speak for themselves, but they strike me as too negative.

NOW, RUSH, MOMENTUM - These stem from the Obama strategy to grab the economic crisis by the ears to further his political advantage.

BROKEN – This is the liberal’s favorite pejorative about the health system, even though 80% of covered Americans say they like their coverage.

• BOOM – This appeals because it stresses the boost health care gives to domestic employment – The July 19 New York Times reports these gains in employment at a time of overall 10% decline in employment – hospitals +3.4%. outpatient care centers +3.6%, health care +3.7%. physician offices +4.1%. ambulatory health care services +4.9%, home health care services +8.6%.

SPEEDTRAP - This is about political hype meeting economic realities – rising unemployment, mounting debts, health industry resistance, the common sense of the American public, Blue Dog Democrats, Intransient Republican opposition, and the OMB director’s announcement Obamacare will.cost, not save, money.

MANDATE- This is appropriate because of federal grabs for power through individual, business, and health plan mandates to assure universal coverage no matter what the price.

UNREAD- I like this because it captures the crisis mentality, namely that this damn thing is so urgent , compelling, and overwhelming that one need not read the small print or consider the implications of what one is doing.

DIVIDED- The nation’s physicians and the American public remains divided on what to do and how to handle the costs of health care. They do not trust the heavy hand of government, yet do not know how a reasonable alternative, e.g.,market-based competition with federal oversight, might work.

RATIONING - This is too abhorrent a word for Americans, although it already exists as economic filter.


I’ve decided upon CONFLICTED. Why? Because we doctors feel genuinely conflicted about President Obama’s plans. Frankly, most of us welcome the ideas of universal coverage and of patients not going bankrupt,and of providing affordable care for all. We like the thought of adding 50 more million paying customers to our panels of care. We like the idea of patients not having to worry about what care costs.

But we're concerned about the strings attached.

We’re conflicted between good intentions and bad consequences. We are in a clash with our own consciences and our own forebodings . We know from the past that,

• adding 50 million more to the federal rolls will cost the system trillions more and will not save money;

• the Golden Rule of Government – he who taxes and uses OPM (other people’s money) has the Gold- will rule;

• you can’t manage care in the office or in the hospital from the Top-Down without distorting and contorting patient-doctor relationships ;

• the current bill being proposed by the House will drive practicing doctors away from seeing new Medicare and Medicaid patients;

• the doctor shortage is real and the next big crisis will be lack of access to doctors with long waiting lines, and overcrowded emergency rooms;

• CMS (Centers of Medicare and Medicaid) is a bad business partner, and is prone to making arbitrary and ill-conceived cuts in reimbursement – as they did this week in cardiology and imaging services in the 20 to 30% range;

• Government pays 20% to 40% less than private plans.

We’re conflicted too because, we don’t trust our own supposed leadership – the AMA and their endorsement of the latest House Plan.

Here, for example, is what 4700 Sermo members are saying about the AMA in a July 19 poll of Sermo’s 100,000 members,

1. Do you endorse the current House Healthcare bill as written?
No, 94%
Yes, 6%

2. Does the AMA speak for you in endorsing the House bill?
No, 95%
Yes, 5%

3. What are the most important issues that must be addressed?
Limiting 3rd party and administrators compromising doctor-patient relationships 36%
Malpractice reform, 32%
Other, 31%.

Small Sample

This is a small sample and may not represent the views of American doctors as a whole, but it deserves our attention. Significant numbers of us think playing ball with the Obama administration and Congressional Democrats is a dangerous game. Many America’s physicians are revolting against the AMA, to which less than 20% now belong. We are doubtful about the motives of America’s political leadership, as manifested by Democratic Congressional majorities. We want to influence the policies that emerge, but feel powerless and conflicted on how to do so.


Friday, July 17, 2009

Big Blow and Big Thing

"We do not see the sort of fundamental changes that would be necessary to reduce the trajectory of federal health spending by a significant amount," Douglas Elmendorf, director of the Congressional Budget Office, told the Senate Budget Committee. "On the contrary, the legislation significantly expands the federal responsibility for health-care costs," he added.

Gregg Hitt, “Budget Blow for Health Plan: Congress’s Chief Fiscal Watchdog Warns of Overhaul’s Cost; Ammunition for Critics,: Wall Street Journal, July 17, 2009

Well, I’m happy to see the director of Congressional Business Office has come to an obvious conclusion that I share. In Obama, Doctors, and Health Reform (I Universe, 2009, available at,, and, had this to say,

“I only know one thing- and it’s a big thing. In the words of Archilochus, a seventh B.C. sage, “The fox knows many things, but the hedgehog knows one great thing.” Doctors are hedgehogs. Physicians are close to the ground in the clinical trenches. They know it’ll be impossible to superimpose a single-payer system on the current system – without radically changing the payment system, rationing, and expending trillions of dollars more.”

As a hedgehog, I know these little things contribute to the one big thing.

• The House and Senate bills do little or nothing to control costs, indeed, adding 46 million to the federal rolls guarantees higher cost.

• Without cost control, government entitlement programs always cost more and a lot more.

• The suggested means of controlling costs – prevention, electronic medical records, and coordinated care – are unproven means of cost control.

• Medicare and Medicaid expenses are increasing 34% faster than the private sector, shredding the argument that government has lower administrative costs.

• Government has only two fundamental means of controlling costs – paying providers less and rationing.

• Other cost controls being suggested - consolidation of physicians into groups and networks, paying hospitals and doctors for total care or episodes, and for managing population or panels of patients - are capitation revisited and have failed in the past.

• Increased costs in American health care compared to other nations are mainly due to superior technologies, demand for prompt access to these technologies, restoration of older Americans to full function through cataracts, joint replacements, and heart-related devices, cultural factors such as one of every five Americans being a recent immigrants, the American malpractice climate – not to physician greed or overtreatment or end of life care.

• The moral obligation arguments that the uninsured represent a moral blight on American has marginal merit but often falls apart when one examines who makes up the uninsured.

• The best means of controlling costs are;

- to give Americans and their families a given and generous amount of tax-free money to spend on health care;

- subsidize the poor and those unable to pay at reasonable levels;

- treat health consumers as responsible, intelligent people capable of making decisions about spending their own money;

- minimize interference by third parties, including Medicare and Medicaid, into doctor-patient interactions;

- foster market innovations such as retail clinics, worksite clinics, cash-only and concierge practices which minimize overhead and have predictable pricing;

- introduce universal catastrophic insurance to assure that no Americans goes bankrupt from health costs;

- have universal tort reform with caps on awards for medical injuries;

- put to rest the notion that a top-down bureaucracy can control costs, rationalize care, and micromanage all patient-doctor interactions without input by patients and doctors.

Thursday, July 16, 2009

blogging doggerel - Obama's Health Care Rope-a-Dope

I have known Stanley Feld, MD, for a number of years. He is a retired Dallas endocrinologist who founded and ran a large endocrinology practice specializing in diabetes care. Since he retired, he has created a widely read blog, “Repairing the Healthcare System.” Stanley is a former New Yorker who has adopted the Texas Mindset. He once told me, “When I came to Texas, I thought I would be dealing with a bunch of Rubes. Now I realize Texas are among the smartest people I’ve ever met.” Below is a recent blog, which I find perceptive and which I characterize as follows.

There was a retired doctor in Dallas named Stanley Feld.
Seldom his strong health care reform opinions he withheld.
Here Feld asserts President Obama promises change and hope,
But when it comes to paying for it he practices rope-a-dope.
By doing so his political opponents he has effectively quelled.

Repairing the Healthcare System

The Obama Method
Posted: 12 Jul 2009 06:47 AM PDT

Stanley Feld M.D.,FACP,MACE

In the last six President Obama has pushed through congress much legislation. Legislation that will increase the budget deficit to at least $3.4 trillion dollars. Republicans have been unable to express effective opposition because of President Obama’s political tactics.

Much of government spending in the past is has been riddled with inefficiency and unintended consequences. The intent might have been to help the little guy but has consistently created an advantage for large corporations.

How does President Obama do it? Jonthan Chait of the New Republic, a liberal periodical, described the process.

“The thing that people haven't figured out about President Obama's conduct of foreign policy is that it's the same as his conduct of domestic policy. Obama believes in the power of negotiation and public dialogue to split his adversaries--Republicans at home, Islamists abroad--and strengthen his own position.

President Obama begins by finding common ground with his enemies. He then expresses respect for their core beliefs. He follows with profuse hope for cooperation.
“This rhetoric removes the locus of debate from the realm of tribal conflict-- red state versus blue state, Islam versus America--and puts it onto specific questions--Is the American health care system fair? Is terrorism justified?-- where Obama believes he can win support from soft adherents of the opposing camp.”

He keeps the agreement general as he moves the process along. However, the devil is in the details. The common ground in healthcare does not solve the healthcare system’s problems.

Universal healthcare, affordable cost and increased quality are the common ground.He then leaves it up to the congress to write the law. The underlying strategy is to throw money at the problem even if the strategy will fail. The leaders from both parties are starting to see through this tactic.

“In January 2008, Obama told a newspaper editorial board that Ronald Reagan provided a "sense of dynamism and entrepreneurship that had been missing." Paul Krugman complained, "Where in his remarks was the clear declaration that Reaganomics failed?"
Most Democrats believe Reagonomics failed. They are angered at how President Obama could applaud Reagonomics. I believe it was a less than sincere attempt to stand on common ground with Republicans. He removes the debate from the realm of tribal conflicts. He avoids fighting with Republican over Reagan. The populous applauds because they believe he is on their side. He is then free to craft any policy he pleases. He promotes his policy using the new media (internet). He stays on the high ground and avoids discussing details or detail consequences.

“Obama's method entails small acts of intellectual dishonesty in the pursuit of common ground.”

Greg Scandlen exposed President Obama’s healthcare whiz kids and their attempts to shape public opinion.

“ The Obama administration kids are Peter Orszag, Ezekiel Emanuel (Rahm's brother), and outside advisors like David Cutler and Atul Gawande. They are convinced of their own genius. They think they can create the data driven management systems to eliminate $700 billion of wasted care in the American health care system. They are dismissive of any skeptics. Their very hubris causes them to overlook essential factors that may impede their plans.”

The key to fulfillment is to maintain Americans’ anger at the old way and desperation for change.

President Obama stays in a position to spin his story and paralyze the opposition. (Rope a Dope). He used Dr. Atul Gawande’s (an advisor) June 1 article in the New Yorker to demonize physicians. I pointed out that the article was a masterpiece of disinformation.

“ Dr. Gawande ,an advisor on President Obama’s healthcare team, had an article published in the New Yorker about a month ago that laid out in great detail what he viewed as the inadequacies of the health care system in McAllen, Texas.”
He pointed out that Medicare and Medicaid patients cost twice as much in McAllen as in El Paso. He compared the costs in McAllen to the cost of Medicare patients at the Mayo Clinic.

“He concluded that we needed to replicate the management systems (not-for-profit, salaried employees, team approaches to service delivery) of the Mayo Clinic in places like McAllen, and indeed, throughout the United States. Voila! Problem solved.”
Dr Gawande omitted a few important data points. Mayo Clinic does not care for indigent,Medicare or Medicaid patients long term. He ignored the fact that Medicare has the machinery to discover and deal with cost outliers and impose heavy fines.
The Texas Medical Association checked on some of the data Dr. Gawande used and ignored. He overlooked the following in exposing McAllen’s physicians.

 “Its population is the poorest in the entire United States.

 It has the fewest physicians per capita in the entire United States.

 It has the second highest uninsured rate in a state that is the Uninsured Capital of the United States.

 It is heavily reliant on Medicaid and Medicare payments to finance its entire health care system.

 It is plagued by very high rates of obesity, diabetes, lack of exercise, and overall poor health status”(chronic disease demanding long term care).
The TMA article explains the poverty rate in McAllen is nearly three times that of the Mayo Clinic. McAllen’s physician supply is half that of the Mayo Clinic.

"Where there is poor availability of outpatient care, patients are far more likely to seek routine care in hospital emergency rooms, where costs are high and diagnostic testing is more frequent. This is also far more likely to result in costly hospital admissions. The data that Dr. Gawande depended on - but did not report - show just this. McAllen has a pattern of unusually high inpatient costs, while outpatient costs are close to average."

Many intelligent people reading the New Yorker article believed physicians in private practice are crooks. This is the point of the disinformation. It is typical of President Obama’s method of winning public support.

If President Obama’s tactics succeed in crafting his healthcare policy the nation is facing a $1.5-3.5 trillion dollar deficit with zero improvement in our healthcare system.

President Obama’s tactics are becoming transparent. Everyone is getting tired of false hope. Policy and plans are ill conceived and destined to fail. However the cost will be dear to tax payers.