Sunday, February 28, 2010

Do-or-Die - Fundaments of Health Reform

I always test my bath before I sit
And I’m always moved to wonderment
That what chills my finger not a bit
Is so frigid upon my fundament.

Ogden Nash, 1902-1971

As I sat reading a New York Times piece in the Week in Review section, “The Cost of Doing Nothing,” Ogden Nash’s verse sprang to mind.

Then I read two other inflationary articles in the same section, “”Six Ideas for America!”with a subheading of “Agreeing to disagree on disagreement,” and the other “Six Hours of Hot Air!” with subtitle of “One had nothing, the other had nothing good. “

The three authors’ tone was the same, if universal coverage, our pet moral imperative, is not achieved, then nothing is achieved, and a pox of both Democrat and Republican houses.

What will happen to our collective fundaments if we do nothing? Will health care costs sort themselves out and save the U.S. from collective financial suicide?

Not likely says the Times,

“Far from it, health policy analysts and economists of nearly every ideological persuasion agree. The unrelenting rise in medical costs is likely to wreak havoc within the system and beyond it, and pretty much everyone will be affected, directly and indirectly.”

Doing Nothing Not an Option

If doing nothing is not an option, say doomsayers, why not Medicare-for-all? As a hospital administrator friend of mine used to say to us doctors , “Don’t do nothing, do something!”

What’s the problem with American politicians? The problem is the American people and our culture. The basic premise of uur founding fathers 234 years ago was that Americans should do individualism, not collectivism. Individuals, not government, should reign.

We Don’t Do Comprehensive Well

As Senator Lamar Alexander of Tennessee said in his opening remarks at the health reform summit,

“When I go down on the floor, some of my Democratic friends will say, ‘Well, Lamar, where's the Republican comprehensive bill?’ And I say back, ‘Well, if you're waiting for Mitch McConnell to roll in a wheelbarrow in here with a 2,700-page Republican comprehensive bill, it's not going to happen,’ because we've come to the conclusion that we don't do comprehensive well. “

Senator Alexander explained,

“We've watched the comprehensive economy-wide cap in trade. We've watched the comprehensive immigration bill. We had the best senators we've got working on that in a bipartisan way. We've watched the comprehensive health care bill. And they fall of their own weight.”

“ Our country is too big, too complicated, too diverse, too decentralized for Washington, a few of us here, just to write a few rules about remaking 17 percent of the economy all at once. That sort of thinking works in a classroom, but it doesn't work very well in our big, complicated country.”

Senator Kent Conrad later noted, Americans don’t do coordinated care well either. Conrad might have added, we don’t do care for the have-nots, the uninsured, well either.

Governor Palin, had she been there, would surely have added, we don’t do death panels well to boot.

Six Ideas

Alexander said Republicans had six incremental ideas for fixing the system,

One, adding incentives for small business.

Two, helping Americans buy insurance across state lines.

Three, ending junk lawsuits against doctors.

Four, giving states incentives to lower costs.

Number five, expanding health savings accounts.

Number six, allowing patients with pre-existing conditions to afford coverage

All At Once, Or Not At All

This list infuriated Democrats, who asserted we must do it all at once, rather than starting from scratch and doing it one step at a time.

So how do we save our collective fundaments?

Democrats say we must mandate that everyone, individuals and employers, pay so we can create one huge pool and collectively lower costs. Unfortunately, as individualists, we don’t do mandates well.

Republicans claim we can only lower costs by introducing health savings accounts with high deductibles so individual patients pay a larger load of the initial costs, thus effectively ending the free-lunch mentality. That does not leave much room for collective action.

Well, it’s a big, complicated, diverse, decentralized country. I suspect there’s room for both points of view. There had better be. Otherwise we will be up to our collective fundaments in debt. That is a chilling thought.

Saturday, February 27, 2010

Physician Business Ideas: Physicians - Supply, Demand, Salaries, and Benefits

In yesterday’s blog, “Doctor Tail Wags Health Reform,” I said the laws of supply-and-demand for physician services puts doctors in good negotiating position.

Several physicians have asked for details.

Here are some bare facts gathered from two books.

Book One, In Their Own Words, 12,000 Physicians Reveal Their Thoughts on Medical Practice in America, Morgan James publishing, 2010, by Philip Miller of Merritt Hawkins and Associates, and Lou Goodman and Tim Norbeck of the Physicians Foundation

Book Two, Guide to Physician Recruiting, Practice Support Resource, Inc, 2007, by James Merritt, Joseph Hawkins, and Phillip Miller, Merritt Hawkins and Associates.


Projected Shortage of Physicians in 2025 by Specialty Group

Primary care 46,000 (37% deficit)
Surgery 41,000 (33% deficit)
Other patient care 29,000 (23% deficit)
Medical specialties 8,000 (7% deficit)

Supply Benefits

Starting incomes, high, for recruited specialties

2002 2006 % change

Internal medicine $200,000 $250,000 +25%
Family practice $190,000 $220,000 +16%
Hospitalist $180,000 $190,000 + 4%
General Surgery $275,000 $350,000 +27%
Ob/Gyn $325,000 $450,000 +38%
Emergency Medicine $255,000 $270,000 + 6%

Source: Guide to Physician Recruiting, 2007, Figures are for high offers. Average offers for 2006 were Internal Medicine, $162.000, Family Practice, $146,000, Hospitalist $155,000, General Surgery $272,000, Ob-Gyn $237,000, and Emergency Medicine $230,000.

A number of physician income compensation surveys – MGMA, AMGA, Merritt Hawkins and Associate, Sullivan, Cotter & Associates, Hospitals & Healthcare Compensation Services (HHCS), Warren Surveys, and Hay Group- are available for tracking incomes by specialties. Here are the averages from these seven surveys for 2006.

Internal Medicine $158,000
Family Practice $154,000
General Surgery $255,000
Emergency Medicine $203,000
Ob-Gyn $238,000

Benefits: salary 15%, salary with bonus 53%, income guarantee 32%, paying for relocation 99%, signing bonus 58%. Average amount of bonuses $20,480. Payment for CME 90%, average amount of CME payment $3830. Additional benefits - health insurance 81%, malpractice 92%, retirement 70%, and disability 70%, educational loan forgiveness 34%.

As the physician shortage grows, increased demand for their services will place physicians in a better position to negotiate.

Physician Business Ideas: Doctor Tail Will Wag Health Reform Dog

Doctors will soon be wagging the reform dog.

Look at it this way. Expansion of insurance coverage to the 31 million more Americans, as envisioned in the current reform bill, will require more doctors to care for them. The starting entry of 78 million baby boomers in the Medicare pool, starting in 2011, will also take more doctors.

As everybody knows, coverage does not equal access. This is most vividly illustrated in Massachusetts. It has 97% coverage, but its waiting lines to see a doctor are twice the national average. Yet Massachusetts, after Washington, D.C., has the highest number of doctors per capita as any other state. How long will waiting lines be in states will fewer doctors and larger Medicare and Medicaid populations?

Several factors will contribute to doctor tail – reform waging phenomenon.

• A shortage of doctors, estimated at 50,000 but headed towards 150,000 by 2020 exists.

• Physician hours spent practicing per week have dwindled by about 10% over the last 5 years, due in part to dwindling reimbursement and desire for saner and more balanced work hours by younger doctors and women physicians.

• Starting on March 1, using the Sustainable Growth Rate formula, Congress will cut physician Medicare reimbursement by 21%. Even if a fix or patch occurs, doctors get the message. Add to that more than 40% cuts in certain cardiology and radiology fees, and the handwriting is even more clearly on the wall.

• Presently doctors are not accepting new Medicare patients at about the 30% level and new Medicaid patients at a 50% rate.

• Doctors are rapidly avoiding third party payment – from Medicare, Medicaid, and HMO/PPOs - because of lowered reimbursements, regulation expenses, and harassment burdens by switching to new business models, involving cash only payments, direct contracting with patients, and concierge practices.

A major access crisis is brewing out there – and federal and state policy types know it. They may attempt to short-circuit the crisis by tying medical licensure to acceptance of patients in federal and state entitlement programs. This is already in the works in the Massachusetts legislature.

No matter what happens, government officials will have to explain to an angry public why people can no longer find a doctor to care for them in their communities, why no specialists are available in emergency rooms, and why people have to travel long distances to find a doctor.

At that point, the doctor tail will be wagging the reform dog, and doctors will be in a better negotiating position.

Friday, February 26, 2010

Satire, Do-or-Die - What President Obama is Telling the American People

As a physician, I have been trying to figure out what Obama is trying to tell the American people. After the summit, the President and fellow Democrats seem to be saying. We are going to push ahead with our reform plan even though two-thirds of you oppose it, and even though through your Tea Parties, town hall protects, and your elections of conservatives, you are expressing your deep discontent.

We are not listening, for once we ram our bill through, you will like it, you will love us, and you will vote for us come November. Besides we have too much political capital invested to back off now. We have seen the future, and you are ours.

Think of it this way. You are victims. You are helpless against heartless health care corporations, insurance companies, hospitals, and even your doctor.

You need us to protect you. You need us to take over and do things you cannot do for yourself, especially in opposing those terrible confiscatory insurance companies who insist they must make a profit of 2% to 5% to stay in business, to satisfy stockholders, to pay executive salaries, to meet capital requirements imposed by states, and to do so by denying coverage to the sick among you.

Relax. We, the government will take care of you. You can depend on us. When it comes to your health and your economic security, government money is no object.

We will ward off the forces of consumer-driven health care. They say you should be active, responsible consumers of health care, rather than passive victims of monetary greed. You know better. So do we.

We will make sure you get comprehensive health plans, even though you may prefer bare bones plans for lower premiums. We will mandate coverage for you by making the young and every other individual pays for the old. We will mandate that your employers cover you. We will not pass malpractice reform, for you deserve all you can get from doctors if they make a mistake or forget to order a test or a procedure that in retrospect may have helped you.

If you can’t afford care, we will subsidize your care. We will cover 31 million more of you, even though half of you may have to enter the Medicaid welfare rolls and abandon your present plans. We will regulate everything to make sure you get what we say you should get.

We know your doctors are taking advantage of you by doing unnecessary procedures and tests. So we will set up an agency of government, to implement comparative research effectiveness, so doctors will do only what works for the average person, but not necessarily for you.

Anyway octors are overpaid, so next Monday, March 1, we will cut their Medicare fees by 21%. Nearly 30% of them have vowed to quit seeing Medicare patients if this happens. We'll find somebody else to take of you - a nurse practitioner, a physician assistant, an alternative provider, or a foreign trained physician. Maybe you will be able to care for yourself using the Internet at a site.

We will discourage the use of health savings accounts. Employers all over the country are adopting these accounts, because your health care costs them less. Your premiums are less, and nearly a third buying these accounts was previously uninsured. But the accounts have high deductibles, and you will have to pay more of your own money. That is sinful because you should never have to part with your money and to take responsibility for making your own decisions. That’s the government’s job.

With health savings accounts, you might feel obligated to negotiate with your doctor, and he or she will take advantage of you. Only we in Washington know what is good for you, and you do not have the knowledge or our accumulated wisdom to make your own decisions, especially if those decisions require a doctor as a trusted advisor. Doctors cannot be trusted, for they do not have the data to make the right decisions. Only the government has that data, to be gathered through our ubiquitous interoperable electronic medical record system.

Your premiums may be higher under our plan because of taxes imposed on drug, medical device, and health plan companies, and passed through to you. For those of you in unions who have Cadillac plans, do not worry. We have deferred payment until 2018, after I leave office.

And we will make sure your doctor abides by our regulations, even though it makes take him or her an hour or two a day to submit our paperwork. That will mean he or she has less time seeing you, but that will worth it, for the doctor will be following Gov-given rules. Our rules are not made to be broken. They are made to be audited and enforced, for your protection, of course.

Do not concern yourself at the present about the national debt. Our plans may only cost $1 trillion for the next ten years, and we have delayed payment of another $1.5 trillion or two to the next decade. Let your children and grandchildren fret about that. And do not worry about taxes. The rich, those who run small businesses and who invest in innovation, the future, and who hire most Americans, will supply the taxes.

We in Washington care. We know what is good for you. And we know what is bad for you. Any organization that makes a profit – a drug company, a medical device company, a health insurance company, and even a hospital or a doctor – is bad for you.

To make sure you get what is good for you, on occasion, we may have to intervene in your relationship with your doctor, but you can trust us – we care – and the health care marketplace does not. You may think the government is trying to take over health care, and to play with your lives and your money, but that is no so.

We, the government, can be trusted to spend your money wisely. We are masters at spending the money of other people in your best interest – and our best political interest. You are helpless without us. You need our protection. Depend on us, and be dependent on us.

Do-or-Die - health summit - mpression of Health Summit

My impression of the health care summit was that it was unlikely to change anybody’s mind. It did not change mine. Those who believe government is the answer will continue to think so. Those who advocate market solutions will remain firm in their beliefs.

The President deserves praise for bringing partisans together. It was the right thing to do. The conference aired clear differences and strategies.

The summit was not, to use President Obama’s favorite expression, a “game changer.”Yet it was a long overdue meeting. It should have been held long ago, at the beginning, not the end of the reform process.

One Republican stratagem was to use the hefty 2700 page bill with Obama’s 11 page summary on top as a prop. They then read aloud selections from it. Through the use of Democrats’ own words, this technique scored points.

The Obama rejoinder to criticisms for excluding Republican views from the bill was to say everything you’ve mentioned is already in the bill, and we’ve thought of it before. I found this approach vague and less than edifying or electrifying.

My conclusion? President Obama will continue to lecture Republicans, and Republicans will continue to hector Democrats. Democrats will try to “ram” or “jam” a bill through by a simple majority using “reconciliation” – a misnomer for literate laymen.

Republicans will accuse Democrats of defying the will of the American people. If reconciliation succeeds in March, Blue Dogs will fall in November.

Democrats maintained their bill controls costs, overhauls insurers, reduces deficits, and expands coverage. Nonsense, said Republicans, the bill does not control costs, raises premiums, expands deficits, and pushes more people into Medicaid.

The most effective speakers were,

• Republican Senator Lamar Alexander of Tennessee , who laid out the case for tort reform, marketing across state lines, and health savings accounts;

• Republican Senator Tom Coburn of Oklahoma, who bluntly explained why fraud and abuse are the real culprits;

• Democratic Senator Tom Harkins of Iowa, who said we must stop “segregation” on the basis of disease, just was we stopped segregation on the basis of color;

• Democratic Senator Kent Conrad of North Dakota, who said 5% of people with chronic disease consume 50% of costs and called for disease “coordination “or Medicare will collapse;

• Representative Paul Ryan of Wisconsin, who explained the true cost of the bill, was $2.5 billion, not $ 1 billion, mostly because of “smoke and mirrors.”

As for President Obama, he was defensive and less than convincing about “bridging the gap” and “reaching broad areas of agreement.” He seemed particularly hung up about the unfairness of Medicare Advantage plans. He returned to that subject again and again. I found his crack at Senator McCain for continuing to campaign demeaning.

Reform is likely to be settled by an up and down vote. President Obama may choose to “go small” rather than getting “nothing at all,” an intolerable political defeat.

One thing missing was a more vivid highlighting of why the American people resist Obamacare. After all, an average of seven recent nationwide polls indicates only 40% of Americans favor the Obama plan while 51% oppose it.

What do the people want other than lower costs? It was not clear from the summit, but according to Rob Lambert, a physician in the Southeastern United States, in a letter to President Obama, entitled “Dear Mr. President” and appearing in today’s The Health Care Blog,

1. People want things to get simpler.

2. People want access to their medical records.

3. People are very suspicious of big health organizations and big government.

4. People want a less secretive system.

5. People think the President it out of touch with them, should stop playing with their lives and money, and should stop acting like he is part of an elite ruling class.

As for me, I think the country is too big, too diverse, and too complicated for a one-size-fits-all bill to be directed from above.

The President should level with Americans about what is necessary and possible and take incremental steps to do what needs to be done. Government has neither the resources nor the wisdom to solve every problem with one bill.

No matter how many experts it consults or how many pages of legislation it writes, it cannot anticipate all consequences.

What succeeds in reforming the system will depend on how individuals, patients, doctors, employers, and others respond to incentives.

Government cannot dictate, it can only catalyze results. Achieving health and productive lives rests with responsible individuals, not with government bureaucrats.

Thursday, February 25, 2010

Hospitals and Doctors, Medical Trends, Physician Business Ideas: Hospitals Acquire Multispecialty and Specialty Practices

Yesterday I was speaking to Mike Martin, president of Practice Support Resources, Inc, in Independence, Missouri. He was just back from a trip evaluating specialty practices for sale to hospitals. He tells me hospitals are purchasing specialty practices at a record pace. Acquisitions of certain practices, such as cardiologists, Mike says, are absolutely booming.

This does not surprise me. When I was practicing at a hospital in Oklahoma City, the two biggest admitters to the hospital were cardiologists. The hospital depended heavily on those two, who accounted for 25 percent of all admissions.

It is no secret that 80 percent to 85 percent of most hospital bottom-lines depend on cardiologists, orthopedists, and other procedural specialists. This is especially true for rural hospitals, who consistently lose money on disproportionally large Medicaid and Medicare populations.

I am tempted to say, “ I told you so.”

On January 12, I wrote a blog entitled “ Twelve Medical Megatrends: A Seat of the Pants Analysis.”

Trends three and four were,

Trend Three, more doctors , young and old, will join health systems, eschewing solo practices and bailing out of old practices, seeking employment for security, forgiveness of educational debt, sign-up bonuses, and saner life styles.

Trend Four, hospitals will buy out established specialty practices in record numbers, as specialist groups seek funds for infrastructure, recruiting, and IT expenses, and as hospitals seek to bolster bottom lines and marketing cachet from high profit specialty lines.

These are two of those below- the -radar trends that you hear little about but have profound implications – higher costs because procedures done inside hospitals are more expensive than those done outside, and doctors hired as employees may behave much differently than those practicing outside. Hospital doctors may rely on hospital protocols rather than independent judgments, and will work shorter hours, and will take regular vacations with more time off.

These trends are not necessarily bad, but the future will be different. The trends may exaggerate the doctor shortage and may lead to an employee mentality. Health care will be determined by events that are impossible to foresee and trends that now exist and are observable.

These trends
will accelerate as reimbursements for doctors shrink, such as the 40 percent cuts in Medicare cardiology fees, and as federal demands and incentives to install expensive electronic medical record systems grow.

Only one trend is certain. Economic pressures are forcing hospitals to consolidate and physicians to abdicate from private practices.

Wednesday, February 24, 2010

Physician Business Ideas: Defensive Medicine Costs - How Much?

Preface: If you talk to lawyers and doctors about how much the medical liability system costs, you will get entirely different answers. Lawyers generally cite costs of settled cases and put the figure at about 1.5 percent to 2 percent of total costs. Physicians think entirely differently. They estimate the true cost runs 26% if you take the psychological imperative of doctors to protect themselves into account. This would amount to $2167 each year for each U.S. citizen. Small wonder that doctors put tort reform as number one on their health reform agenda.

Physicians attribute 26 percent of healthcare costs to defensive medicine

According to a new study released by Gallup and Jackson Healthcare, physicians attribute 26 percent of overall health care costs to the practice of defensive medicine.

Among survey findings:

• While physicians attribute an average of 26 percent of overall costs to defensive medicine, 13 percent believe the practice constitutes 50 percent or more of the cost.

• 73% agreed that they had practiced some form of defensive medicine in the past 12 months.

• 23% of practicing physicians estimate that defensive medicine constitutes less than 10 percent of their practice while 29% estimate the percentage to be between 10 percent and less than 25 percent.

• Physicians indicating they had practiced a form of defensive medicine in the last twelve months attribute 21 percent of their practice to be defensive in nature.

Jackson Healthcare, February 19, 2010. "New Gallup poll quantifies U.S. physician opinions on the scope of defensive medicine practices."

Do-or-Die - Health summit D.C. Health Reform Summit

A wag memorably remarked “ D.C.”, as in Washington, D.C., stands for “Darkness and Confusion.”

This remark certainly applies to the six hour proceedings tomorrow, when President Obama and the Republican leadership will have a go at each other before C-Span cameras.

The summit is the dark side of politics because everyone is in the dark about the outcome. The summit is also confusing because liberals and conservative commentators differ on why the summit is being held and what the outcome is likely to be.

Liberals see the summit as the final act in the push to pass reform and to convince the public they are right. Conservatives see it simply as political posturing, a photo-op to showcase Obama’s persuasive powers.

To clear up the darkness and confusion, I find most enlightening the February 22 remarks of Lee Stillwell, founder and CEO of The Stillwell Group. These remarks appear in The Washington Report, written for the Physicians Foundation, and accessible at The Physicians Foundation is a non-profit organization dedicated to helping independent physicians improve health care.

Stillwell was the chief advocate for the AMA for 18 years. He worked both sides of the political aisle, first as key aide for an Eastern Democrat, then in a similar capacity for a Western Republican.

Here is Stillwell’s take.

“I find it amazing that Obama – who faces plummeting job approval ratings from the public with Real Clear Politics (RCP) indicating his ratings are now below 50 percent at 47 percent – pushes on. And Ditto for the Democratic Congressional leadership, who are looking at polls that show only one of five approve of the efforts of Congress.”

“Even more surprising, they march on despite polls that now show more than half of America strongly opposes their health reform proposals.”

“So you have to ask yourself why? Well, there are two scenarios that make the rounds. One is that Obama and his supporters passionately believe in the cause. The other often-mentioned reason is that they have invested a year of political capital in the issue and must show the voters in November a return. As an observer, I believe it is combination of both.”

House Republic whip, Eric Cantor of Virginia, says his party will show why the Democrat’s bill ought to be thrown out. “Maybe so,” observes Stillwell, “but Cantor and his colleagues will have to step up their game if they are to beat the media-savvy President at his favorite sport.”

Tuesday, February 23, 2010

Do-or-Die - Partisan Season for Health Reform

Preface: When one political party claims the other party is devoid of ideas, we are in the political partisan season. Each party has ideas. One says government should control care. The other says let the market decide. And never the twain shall meet.

I prefer the market approach, as expressed in the following report from The American Enterprise Institute. One of its authors is Joseph Antos, a PhD economist.

I interviewed him for my 2005 book, Voices of Health Reform, and I respect his opinion.

Here is an executive summary the American Enterprise Institute's report,

A Better Prescription:
Realistic Health Reform

By Joseph Antos, Thomas P. Miller, Resident Scholar and Resident Fellow, American Enterprise Institute

February 23, 2010

Executive Summary

"After a year of political wrangling and two thousand-page bills that promise more than they can deliver, it is time for a more prudent approach to health care reform. Americans made it clear that they will not tolerate a top-down health reform that further centralizes power and decision making in Washington. They distrust the promises of lower cost and more secure coverage, and they fear losing what they have now."

"A new approach to reform is needed, one that levels with the American people about what is possible and what is necessary. The better prescription requires that we rethink both the goals and methods of health reform."

"• We must set realistic priorities for reform. We have neither the resources nor the wisdom to solve every problem in the health system through one grand legislative act.

• We must take measured steps to reform the health system, allowing for frequent midcourse corrections as we learn how the system reacts to policy changes. We cannot anticipate every contingency and prevent every adverse consequence, no matter how many experts we consult or pages of legislation we write.

• We must recognize that the success of health system reform depends crucially on the way individuals, health providers, employers, and others respond to changes in incentives. Government can act as a catalyst for reform without attempting to dictate the results.

• We must recognize that the ultimate objective is to help Americans achieve healthier, more productive lives. Much of the responsibility for accomplishing that goal will rest with individuals, and their actions can be taken with no changes in government policy."

"The following describes targeted actions that should be adopted by Congress as part of a broad health system reform effort."

Number One: Place the Money--and Greater Control--in Consumers' Hands

"• Replace Existing Tax Breaks for Health Insurance with Tax Credits.

• Promote Better Health Insurance Choices.

• Promote Information to Help Patients and Their Doctors

• Make More Informed Treatment Decisions.

Number Two:
Align Expectations with Reality

• Promote Effective and Fiscally Responsible Competition in Medicare.

• Provide More Predictable Funding for Medicaid.

Number Three: Create Accountability in the Health System

• Provide Better Access to Affordable Private Insurance.

• Develop Better Ways to Pay for Health Services That Reward Superior Value.

• Reform the Medical-Liability System.

• Promote Personal Responsibility."


Market-based health reform provides the tools by which the health system can become more effective, more efficient, and more responsive to patient needs. It relies on financial incentives rather than central direction and control, and it recognizes that a one-size-fits-all approach will not work in a country as diverse as ours. Unlike a top-down approach, market-based reform fosters accountability throughout the health system."

"A market approach is no panacea, but it does not claim to be. It does not make promises to immediately solve every problem. This approach offers something better: a framework for continuing health system innovation and improvement whose strength lies in its flexibility and ability to adapt to change. This is the only real prescription for sustainable reform of our health care system."

Joseph Antos, PhD, is the Wilson H. Taylor Scholar in Health Care and Retirement Policy at AEI. Thomas P. Miller is a resident fellow at AEI.

And here is my closing limerick,

Obamanites claim the other side has no suggestions,

No real answers to the big health reform questions.

The other side says it has plenty of good proposals,

But Obamanites file their ideas under “disposals.”

These positions don’t lead to bipartisan digestions.

Do-or-Die - Obamanations - Why Obamacare May Fail

This is the eve of President Obama’s health care summit at Blair House. The President seeks to craft a health care compromise while TV cameras whirl. This is ostensibly a good idea. It certainly will score political points.

But I awoke this morning with a bad dream and a bad idea for a new book with ten chapters. The bad dream was that Obamacare failed. The bad book’s title was Obamanations and Obamacare.

Before I get to the dream and the book, let me list the key points of Obama’s new health plan. It will serve as the nucleus of his summit meeting.

Five Key Points

His new health care stew has five ingredients.

One, it would create a new government agency –Health Insurance Rate Authority – to limit what health plans can charge.

Two, it would close the “Donut Hole,” the prescription drug benefit that stops paying Medicare recipients after $2830 is spent and resumes after $4500 out-of-pocket have been expended.

Three, it would delay the start of the “Cadillac Tax” on high cost health plans from 2013 to 2018.

Four, it would end fraud and abuse and those egregious Medicaid bribes for votes known as the” Cornhusker Kickback” and the Louisiana Purchase.”

Five, it would reduce the federal deficit by $100 billion over the next 10 years and $1 trillion in the decade after that.

Something for Everyone

There is something in the plan for everyone - skeptical Americans who pay high health care premiums, chronically-ill seniors coughing up money for prescription drugs, unions angry over taxes on their high cost plans, Tea Party types furious over health reform corruption, and almost everybody else fearful of runaway federal spending and soaring federal deficits.

How could such a politically-adroit plan fail? That's what my book would be about.

Ten Chapters

In my book, I would have ten chapters.

One, Hope, Change, and Vaporware

Two, Medicaid-for-All, Not an American Dream

Domestically Aiming North, Economically Heading South

Fourth, E-Litism and Electronic Medical Records

Five, So Big, It Failed

Six, Less Choice, More Public Remorse

Greater Coverage, Lesser Access

Nationalizing While Rationalizing

Nine, Price-Fixing, Doctor-Nixing

Ten,Patronize People, Patron Special Interests

Monday, February 22, 2010

Interviews with health leaders -Another Interview

I like to interview important national figures in the know because I always learn from them. A few days ago, I interviewed Donald Palmisano, MD, JD, a New Orleans surgeon who served as President of the AMA in 2003-2004.

Among doctors and executives in organized medicine, Palmisano is considered to be an articulate icon. For good reasons. He speaks his mind, he speaks forcefully, and he speaks plainly.

In our interview, which will appear sooner or later in, he said American health care had reached a watershed.

Either we speak out now for patients and ourselves, or government will take control. He fears present government policies will be disastrous – driving up costs, depriving patients and doctors alike of their autonomy, depriving physicians of freedom to privately contract, and dramatically lowering patients’ access to care.

Physicians, Palmisano asserts, will simply be unable to afford to see patients because lower reimbursement from third parties will not meet costs of doing business. Price-fixing by third parties will force physicians to stop seeing new Medicare, Medicaid, and certain HMO/PPO patients because they can’t afford to see them. Price-fixing has never worked, and it will not work now.

Furthermore, doctor will be unable to pay high medical liability premiums and their staff, further limiting physicians ability to see new patients from low-paying third party programs.

Palmisano believes solutions lie in market-based solutions with patients and physicians making the fundamental clinical decisions, This can be made possible by tax credits for all, an array of choices, tort reforms, low-cost health savings accounts, high deductibles with catastrophic lids, coverage of pre-existing conditions rendered feasible through large voluntary associations, defined contributions for Medicare recipients with vouchers.

To make these things happen, he says doctors must speak out to their Congressional Representatives and Senators, tell them the negative consequences of the present system, encourage their patients to do the same, and elect new members of the House of Delegates and new President of the AMA from grunts on the ground, not from current members of the AMA establishment.

Sunday, February 21, 2010

Do-or-Die - Health summit -Health Reform Olympics

It has finally come to this. After a year of partisan debate, President Obama, last year’s gold medalist and his Republican rivals , will meet at the top of the mountain on February 25 in the White House to decide who receives the medals in this year’s winter political Olympics.

No clear favorite exists, even though President Obama will have the high ground as moderator of the event. What he will not have, however, is the majority of the American people on his side. Only one-third approve of Obamacare, and they are angry and frustrated about jobs, spending, and deficits as well. After Senator Scott Brown's Massachusetts election,Republicans are riding a rising conservative tide.

President Obama claims broad areas of agreement exist on such matters as insuring those with pre-existing illness, but he remains adamant any compromise must simultaneously be comprehensive and must cover 30 million more Americans. He insists all of this must be accompanied by cuts in Medicare costs.

Such a compromise is politically unachievable , say Republicans. Finding the solution, Republicans assert, must start from scratch, must be incremental, and must be based on market-driven solutions - shopping across state lines, giving consumers choice, offering health savings accounts, providing tax credits for individuals as well as corporate employees, widening access through larger insurance pools, and reducing costs through tort reform. That doesn’t leave much room for big government – Obama’s preferred solution.

How should PresidentObama and his opponents prepare for this winter’s political Olympic event? Both are in deep training and both have carefully-honed strategic agendas.

A good start would be to read In Their Own Words; 12,000 Physicians Reveal Their Thoughts on Medical Practice in America (Morgan James Publishing, 2010).

The book is a quick read. It is only 143 pages. It is written by Philip Miller of Merritt Hawkins & Associates, the largest U.S. recruiting firm, and Lou Goodman and Tim Norbeck of the Physicians Foundation, which represents physicians in America’s state and local medical societies.

The book is based on a survey of 270,000 primary care doctors and 50,000 specialists closely engaged in primary care. Of doctors surveyed, 82% said their practices would not be sustainable if Medicare reimbursements to physician were further cut, 38% said if cuts occurred they would stop seeing Medicare patients altogether or reduce the number of Medicare patients they see, and 60% remained opposed to a single payer model. They preferred a market-based model.

Whatever compromise Obama et al might hammer out, I suggest, after they read the book, they ask themselves: Who is going to take care of Americans once the solution is reached?

Due to a rising and aging population , caps on the number of medical students and graduate programs, and changes in physician expectations, the U.S, faces a shortage of 200,000 doctors by 2025. The Lewin Group says Obamacare, if enacted, would require 14,500 more doctors, and universal coverage would require an additional 35,000 more doctors.

Presently, foreign-trained physicians are plugging the dike: 25% of practicing physicians in the U.S. and 50% of doctors in primary care training programs are international graduates.

This is not necessary nor desirable. Many bright Americans who would like to become doctors , and many citizens would welcome American doctors into their communities.

Health reform is not only about insurance coverage. It’s about access to doctors too. When we get sick, most of us will want a doctor in the house.

Saturday, February 20, 2010

Physician Business Ideas: Other Practical Articles on Independent Practice

My last blog was on a Doctor Neil Baum article on spotting those details indicating if your practice is ready to receive and please patients.

After I wrote that blog, I realized Neil, a New Orleans urologist and office marketing expert, had submitted 19 other articles to Physician Practice Options. I have served as its editor-in-chief for 14 years. These articles address the every-day-concerns of doctors in the trenches. You may find the articles and read them by going to, and entering the name “Baum” in the search box.

Here are summaries of the articles.

Taking EMRs to the Next Level

Physicians have three options: They can work harder and earn less, they can retire, or they can embrace information technology, says C. Everett Koop, MD, former U.S. Surgeon General. Recognizing the need to embrace information technology, many of us will have electronic medical records in place in 2005. Also, a lot of medical practices will be using document scanners to help manage reports, images, and other paperwork. But most practices have not taken advantage of the true power and benefits of a document imaging and management system (DIMS).
Clinicians Can Learn From Alternative Practitioners
This editorial discusses how traditional physicians can develop relationships with qualified alternative practitioners, which may lead to increased patient safety and more referrals.
Antifraud Efforts Yield Savings
This article discusses the antifraud efforts, including recoupments, reported by the Blue Cross and Blue Shield Association. It also looks at the common types of medical fraud, as well as the federal government's efforts to combat it.
Physicians Become Wary of Litigious Patients
This editorial discusses the detrimental effects medical malpractice lawsuits are having on physician practices, as well as on the choice of specialty medical students are making in their careers.
AHCs Need to Retool, Report Says
This article discusses a report published by the Commonwealth Fund on academic health centers. Specifically, the report looks at the challenges facing AHCs and steps they can take to meet those challenges.
Skilled Telephone Staff Offer Groups Cost-Effective Practice Enhancements
This article discusses how the cultivation and use of skilled telephone staff can be an inexpensive and effective way to enhance a physician practice.
Innovations Can Improve Efficiency
This article discusses how disruptive innovations, particularly those involving new technology, can improve the practice of medicine.
What Physicians Can Learn From Lawyers
This editorial says that physicians may want to consider charging clients for the time they spend on telephone consultations and answering e-mail from patients.
Marketing Expert Explains Keys to Successful Practice Building
This interview discusses four strategies physicians can use to market their practices: calling patients to strengthen existing patient relationships; communicating with referring physicians; pursuing niche practice activities; and motivating staff.
Building Physician and Patient Referrals
This article discusses strategies for building a referral base. It argues that being a "good doctor" may no longer be enough to attract referrals. Instead, when physicians build relationships with referral staffs in hospitals and HMOs and keep the staff of referring physicians happy, they can make staff and patients into a virtual sales team.

Medical Groups Need Professional Management, Physician-Executive Says
This interview discusses how professional practice management services can benefit physician practices. It argues, however, that even after they have contracted for such services, physicians still need to be intimately involved in the business aspects of their medical practice in order to be successful.
Take Charge of Your Medical Practice, Before Someone Else Does It For You
Experts Say Telephone Is the Most Important Customer Service Tool
This story discusses how skillful telephone techniques can not enhance patients' perceptions of a practice, but even help to manage patients' expectations and reduce the likelihood of litigation.
Four Ways To Build Patient Volume
This feature story discusses medical marketing strategies that can help physicians retain current patients and attract new ones.
Pain Is an Epidemic, Undertreated Disease, Experts Say
This article discusses the issues involved in treating chronic pain, as well as some legislative steps being proposed to adress these issues.
Urologist Says: Take Charge of Your Practice
"There are four pillars of a successful practice and each one must be strong and effective. [The four essentials are:] satisfying patients, attracting new patients, motivating and rewarding staff, generating repeat referrals. Take any one of the pillars away and your practice will suffer."
Patient Surveys Produce Satisfying Results
This feature looks at how some physicians are using patient surveys to improve their patient satisfaction levels and as a marketing tool in promoting their practice.
Simple Approach to Measuring Patient Satisfaction
Success in practice, says Neil Baum, MD, a urologist in New Orleans, starts and ends with satisfying patients. Dissatisfied patients, on the other hand, can destroy a practice. Since one dissatisfied patient usually talks about that dissatisfaction to at least 12 people—friends, relatives, co-workers, and referring physicians—such
Minnesota Employers Elevate Physicians’ Status by Eliminating Middlemen
This year, about 7,000 Minnesota physicians—most of them in Minneapolis-St. Paul—began contracting directly with the Buyers’ Health Care Action Group (BHCAG), a coalition of 28 self-insured employers. The health plan, called Choice Plus, eliminates utilization review and makes physicians accountable for costs, quality, and patient

Physician Business Ideas : Canaries in Your Office Coal Mine

In recent years, I have had frequent conservations with Neil Baum, MD, a New Orleans urologist. Neil is a pragmatic, no-nonsense person. He believes independent physicians can thrive by paying rapt attention to practice details.

These details include calling patients after surgery or procedures to see how they are doing, cultivating referral sources and alternative practitioners, techniques for identifying those patients likely to be malpractice risks, how to prepare for natural disasters like Katrina, and developing and applying office market strategies. He has written a book Marketing Your Clinical Practice, now it its third edition.

Yesterday he send me an article “ Have You Checked The Canary in Your Coal Mine?” He was sending it for submission into Physician Practice Options, of which I am editor-in-chief. The article comments on those little details that turn off and turn away patients. The big canary in his office coalmine is the restroom. If the restroom has towels or tissues on the floor, overflowing wastebaskets, of lacks sterile containers for collecting urine, he knows the canaries are crying for more oxygen.

He says you can seek out and find other canaries by asking these questions.

• Are staff members chewing gum?

• Are their uniforms neat and clean?

• Are all staff members wearing name tags?

• Are the computers turned on before placing patients in the exam rooms?

• Has the coffee been brewed for the doctor?

Doctor Baum concludes,

“Bottom line: Just like the blood pressure, pulse, and respiration are indicators of the overall health of your practice, so too are the small details of your staff’s preparation for your patient. So listen to the canaries. If they tweet, you are ready and prepared.

Friday, February 19, 2010

Electronic Medical Records: The Limits of Data Intervention

Inside Account of How the Obama Policy
of Escalating Data Use was Reversed

The regional variations in health care spending that are documented by the Dartmouth Atlas of Health Care have been cited by many as the justification, and possible basis, for changes in provider payment rates. The articles below – and the responses that follow them – address concerns about the Dartmouth data.

“Perspective,” February 18, 2010, New England Journal of Medicine

History has these lessons to teach. Sometimes human behavior on the ground is more important than policies in the air. Sometimes how people react to crisis runs counter to what data dictates. Sometimes in hospital and physician settings, the patient in front of you delineates what needs to be done, rather than what data indicates.

In 1989, Peter Hoopes, a Pentagon official and an historian, wrote The Limits of Intervention: An Inside Account of How the Johnson Policy of Vietnam Escalation was Reversed. Hoopes, a Pentagon insider, had helped develop Pentagon policy. Secretary of Defense, Robert McNamara based his policies on data – body counts, skirmishes won, enemy troop estimates – as criteria for the war effort’s efficiency. Yet the U.S. was losing ground to North Vietnam troops and South Vietnamese guerillas and ultimately lost the war.

Today the Obama administration is losing its battle to control Medicare spending. One of its weapons has been data generated by Medicare data from the Dartmouth Atlas of Health Care, led by Elliot Fisher, MD. The budget director, Peter Orszag, has embraced this data as a tool for reigning in Medicare spending. Orszag has said regional variations in spending are “unwarranted, “ and if we could only we could homogenize spending by bringing down spending in high cost places (like Miami, McAllen, Texas, and major cities) to low cost areas (like the American Midwest), we could slash Medicare spending by 30%.

The Dartmouth data indicates more spending does not lead to improved health outcomes, with body counts (death rates in the last two years of life) being one criteria for efficiency. As Peter Bach, MD, a Sloan Kettering physician and former Medicare official, notes in the February 18 NEJM , “Some policymakers, included President Barack Obama, have proposed the that the features of high-performing, “efficient” health care systems should be identified and their lower-cost practices emulated.”

But two huge flaws mar this policy: one, data is only as good as its assumptions, e.g., that high spending represents “waste” and low spending represents “efficiency.”; and two, Medicare spending is not about “efficiency,” it’s about poverty.

Richard “Buz” Cooper, MD, Professor of Medicine and Senior Fellow at the Leonard Davis Institute of Health Economics at the University of Pennsylvania, has consistently insisted and clearly demonstrated high costs are mostly correlated to poverty in inner cities, especially in large metropolitan areas, and rural regions, particularly the American South, rather than avaricious providers.

The poor are sicker, and present with more advanced disease, than their healthier and more affluent brethren. Consequently, the poor cost more to treat, and hospitals and doctors simply do what they have to treat them and to save them.

Here is Doctor Cooper’s response, in part, to two articles in the New England Journal (1,2), which question the Obama administration’s theories of efficiency and cost savings.

“ I'm sure most of you have seen the article in today's NYT about Peter Bach's paper in the NEJM, which debunks the Dartmouth Atlas ("A Map to Bad Policy") and cautions against its use. As I said in the Washington Post in September, its the ‘Wrong Map for Health Care Reform.’ “

“More damning even than Peter's analysis was Elliott Fisher's reply: "Dr. Fisher (Fisher is a leader at the Dartmouth Institute) agreed that the current Atlas measures should not be used to set hospital payment rates, and that looking at the care of patients at the end of life provides only limited insight into the quality of care provided to those patients. He said he and his colleagues should not be held responsible for the misinterpretation of their data.”

“The Dartmouth work, through Peter Orszag, was the cornerstone of health care reform. It forged the principles that there were pervasive incentives that led doctors and hospitals to over-treat and over-charge, to no benefit, and that the money for health care reform was easily available - no new taxes (as Obama promised) - just make health care "more efficient" and the nation could save 30% ($700B). And to do that, just make everything look like Mayo (white, middle class) and have more primary care physicians (which Mayo doesn't). Now, that has all disappeared. Like Madoff's investments, it was all shadows and mirrors. But this time, the price tag is more than the $50B that Madoff cost. It cost us health care reform. But don't worry, Elliott. We won't blame you.”

1. Peter Bach, MD, “A Map to Bad Policy – Hospital Efficiency Measures in the Dartmouth Atlas : NEJM, February 18, 2010.

2. Jonathan Skinners, PhD, Douglas Steiger, PhD, and Elliot Fisher, “Looking Back, Moving Forward, NEJM, February 15, 2010.

3. Richard Cooper MD, Blog: “Physicians and Health Care Reform: Commentaries and Controversies, “ February 18, 2010.

Thursday, February 18, 2010

Do-or-Die, Scott Brown effect - Scott Brown Election, Before and After

Is the Scott Brown Massachusetts election.
A general and genuine voter insurrection?

Is this a sweeping tsunami,
Or a passing anomaly?

Is it an anti-establishment wave,
Or an anti-liberalism cave?

Regardless of your answer,
Here is the view of this tap-dancer.

Before Democrats were riding high,
Now their time may be running dry.

Before Democrats were the status quo,
Now the voters are saying: whoa!

Before comprehensive reform seemed inevitable,
Now incremental reform seens more desirable.

A new reality may have dawned,
But no knows what lies beyond.

Interviews with health leaders -Another Interview

Yesterday I conducted the ninth of 12 interviews has commissioned me to conduct.

I had the pleasure of interviewing Jane Orient, MD, a general internist who has been Executive Director of the American Association of Physicians and Surgeons (AAPS) since 1989. The Association has 3000 dues-paying members and sends its publications, Journal of American Physicians and Surgeons to 5000 physicians. The mission of AAPS, says Doctor Orient, is to promote private medicine.

It is no secret. Many consider AAPS as a right-wing organization. This is because APPS believes in physician independence, in the sanctity and reasonableness of clinical judgment, in the ability of doctors to make the right decisions for patients, in the right to contract directly with patients, and in the right for physicians to either ignore or opt out of third part arrangements with health plans or government programs.

Above all, AAPS maintains government has no right to interfere in the doctor-patient relationship.

To many observers, especially to those on the left, the AAPS set of values is a wild dream, a return of to pre-revolutionary managed care times.

But not to doctors who are sick and tired of being told what to do, what to charge, and what third parties will accept. Disgusted and disenchanted private practitioners are quitting, becoming hospital employees, taking non-clinical jobs, drifting into locum tenens, or switching to cash or concierge practices. Those who have made the switch claim they are happier, more productive, more profitable, and closer to their patients.

To progressive reformers, including moderates, pulling out of third party payment is radical and wild-eyed. It upsets managed care and federal apple carts.

Furthermore, APPS positions run across the grain of what Obamacare is proposing. AAPS takes these positions. It is against universal health care, government intervention, federal payments for abortions, evidence-based medicine, payment for performance, federally imposed electronic medical records, employer and individual mandates, HIPPA, and other mandates, compliances, and regulations.

The concluding Q and A in our interview went like this.

Q: Are we on the road to serfdom?

A: Yes, but there’s still a path back to freedom. What doctors have to do is turn down the government money. As one of our members said, when you stick out your hand to take the money, that’s when they put the handcuffs on.

Wednesday, February 17, 2010

Hospitals and Doctors, Clinical innovations - Hospital Marketing and Robotic Surgery

A Case of the Obvious: People Responding to What They Usually Respond and Doing What They Usually Do

The battle is lost, marketing is driving the case here.

Jeffrey Cadeiddu MD, “Unproven, Robotic Surgery Wins Converts,” New York Times, February 11, 2010

If you only have a hammer, you tend to see every problem as a nail.

Abraham Maslow

Sometimes I am incredulous when people overlook the obvious.

It is obvious to me,

• hospitals will inevitably market technologies what draws people to their institutions, attracts specialists , and buttresses their bottom line.

• Specialists will gravitate towards those technologies that appeal to the public.

• The American people and American doctors cannot resist new technologies.

• People in general will do what they usually do to better their lot in life.

Health reformers may overlook the obvious as they seek to reduce costs and improve quality. They argue that data on outcomes will always prevail in a rational world. This sounds scientific, but it ignores the psychological nature of humankind.

I was present at a 1976 talk by Howard Hiatt, MD, who was then head of the School of Public Health at Harvard. He said the U.S. ought to form a national technological assessment center to curtail the marketing and premature use of CT scans.

This is a recurrent thought. It has resurfaced in the form of Comparative Effectiveness Research (CER). CER will supposedly separate the good technologies, i.e, the cost effective technologies, from the bad.

CER results will be embedded in protocols, checklists, and decision trees, and from these, doctors and patients and payers will learn what works and doesn’t work. Current reformers and Hiatt ignore the obvious – to doctors CT imaging and robotic surgery were and are potentially superior technologies, and physicians were and are going to use them, no matter what government officials thought and think.

This is true of robotic surgery for prostate cancer, as it was for CT scans. Urologists and other surgeons are going to use robots to perform surgery even in the face of higher costs and even if robotic surgery may not outperforms manual surgery.

There is something irresistible about machines replacing man – the consistency, the relative bloodlessness, the high tech appeal, the quicker recovery times, the doctor as a kind of remote pilot guiding the attack on a cancer enemy.

People will not wait for objective prospective appraisal. In time, we will know if robots surgery is superior to human surgery, but human nature being what it is, hospitals, doctors, and patients are unlikely to wait for results.

Tuesday, February 16, 2010

Interviews with health leaders - Two More Interviews for - One Bottom-Up, One Top-Down

I would like to thank readers of my last blog, which contained lessons learned from six interviews I have conducted for on how to help independent doctors in small practices cut costs, improve outcomes, and remain financially viable. You have suggested further people to interview, and I shall pursue some of your leads.

After today and yesterday, days in which I did two more interviews, I have four more interviews to go. Keep coming up with those suggestions. I may do more than four and put them in a book.

In the last two days, I’ve conducted two more interviews – one with Dr. Gregg Alexander, a pediatrician in London, Ohio, a town of 9000 20 miles outside of Columbus, Ohio; and the other with Dr. Kent Bottles, a pathologist who is president of the Institute of Clinical Systems Improvement in the Twin Cities of Minneapolis and St. Paul.

I would characterize the Alexander chat as a bottom-up interview. Gregg has seized the initiative at the local level to develop a technologically advanced pediatric office with all the bells and whistles of modern information technology concentrated in a modernly designed pediatric office. His is an Act Locally, Think Globally approach by using information technologies to harnass and channel the world’s knowledge. Given the Internet and its wonders and applications, a single practitioner can use these technologies as a lever to act on par with doctors in large medical centers.

The Bottles interview, on the other hand, has the elements of a top-down approach. Bottles advocates a regional consortium of hospitals, doctors, patients, health systems, health plans, and employers, acting in concert with each other and following federal guidelines, is the most practical way to reduce costs and improve outcomes. He gives two examples – one of various parties working together to improve outcomes and reduce costs of treating clinical depression through a liaison of doctors and patients and health systems; and two, doctors and patients using common criteria embedded in EMRs to reach an understanding of when to order CT scans. These understandings have reduced imaging costs by $60 million annually and have eliminated the need for pre-authorization. Bottles, it seems to me, advocates a Think Globally, before one Acts Locally.

The bottom-up, top-down approaches sometimes come at collaboration in different directions. Both, however, emphasize we’re all in this together, and innovation will be necessary to achieve efficiencies and economies.

Sunday, February 14, 2010

Interviews with health leaders - Interviews for

Physicians Caught Between Blue Beast and Red Tide

I’m in the midst of conducting 12 Interviews for, an online medical journal dedicated to helping and informing independent physicians in small practices.

These physicians form the backbone of American medicine. They deliver 80% of U.S. health care. Unfortunately, surveys indicate physicians are unhappy. Many are retiring early, not accepting new Medicare patients, and choosing new business practice models and careers outside of medicine.

As I see it, physicians are caught between the insatiable Blue Beast and the relentless Red Tide. These rapidly moving forces are not the same as a Rock and a Hard Place, which are stationary.

• The Blue Beast is the mixed U.S. economy. It is based on large, mostly unionized companies, like ATT and the Big Three auto makers , and government with its millions of union workers, the medical industrial complex, large universities , and the huge educational sector. The Democratic Party feeds the Blue Beast. The Party is built Blue, thinks Blue, and brings big green to the Big Blue. The Blue Beast is in trouble. Because of global competition and a deep recession, the Blue Beast can no longer keep wages high, and protect the security of all. Its legs have become unsteady and its footing uncertain.

• The Red Tide is a mixed, sometimes inchoate, bag. It is made of up of an increasingly disenchanted middle class, angry Tea Parties , opportunistic conservatives, and uncertain Republicans It distrusts big government, big budgets, big debt, and it wants to boot out an incumbent members of both parties. It is dedicated to bringing the Blue Beast to its knees and replacing it with something – anything – that is more efficient, less costly, and more in touch with reality and their needs. It knows what it wants but as yet does not know how to get it.

It is in this unsettling setting in which I am conducting these interviews. I have done six interviews so far.

First was Dr. Tom Coburn, Republican Senator from Oklahoma. Dr. Cobur dubs himself a family obstetrician. He is a conservative . Health reform, he says, is in trouble. He believes the Blue Beast created much of the current trouble, by mandating what to pay doctors, and by doing so,it created the primary care shortage. He takes a sanguine view that doctors will do fine if they care well for patients. Coburn believes in market forces as the best solution to health cost problems.

Second was Dr. Louis Goodman, CEO of the Texas Medical Association and President of The Physicians’ Foundation, a not-for-profit organization comprised of executive directors of state and local medical societies. The Foundation derives its funds from a 2003 court settlement with national HMOs . It is dedicated to protecting the nation’s independent physicians and issuing grants to make these physicians more efficient , productive, and profitable. Goodman believes tort reform is necessary to achieve this goal.

Third was Dr. John Connolly, president and co-founder of Castle Connolly Medical Ltd, an organization that publishes books on America’s Top Doctors, most of whom it identifies as top-ranked specialists in America’s teaching hospitals and academic centers. The organization is now 18 years old, and it has published a series of books containing information on more than 3000 doctors in these centers. Castle Connolly has a database of more 25,000 doctors and has an elaborate process for winnowing out the top specialists. Connolly believes Americans want access to the very best doctors and are willing to pay for their services. He says current health care proposals threaten the very existence of these centers because of the emphasis on cutting Medicare funds and rationing high tech services.

.Four was Phillip Miller, vice president of corporate communications for the Merritt Hawkins Group , the nation's largest physician recuriting firm, and AMN Healthcare, a leading medical staff company. I interviewed Phillip because he is the author of multiple books on the physician shortage and related topics, such as the burgeoning locum tenens industry. He is a man with a foot on the ground, solidly placed where recruiting is taking place - in hospitals and medical groups. In his interview, he speaks of the shortage of medical man hours, due to such factors as specialization of doctors in high pay specialists with shorter work hours, the search for a balanced life style, more women physicians, early retirement, departure to other fields, and federal caps on training programs.

Five was Daniel Palestrant, MD, a general surgeon and entrepreneur who founded nearly four years ago. Sermo is a social networking site, limited to licensed physician, and dedicated to airing their views, finding where doctors stand on clinical and social and reform issues of the day, and survey their members, now 115,000 strong. Sermo uses the information gathered to further the cause of independent physicians. Palestrant believes that the government and the medical profession are at odds, that the government will take antitrust action against physicians and insurance companies, that more and more doctors will drop out of Medicare, that the American Medical Association no longer serves doctors, and that doctors will increasingly turn to cash practices to avoid third parties.

Six was Ron J. Pion, MD, a 78 year old Obstetrician-Gynecologist dynamo in Los Angeles, who has been a successful medical educator, founder of a hospital satellite network, advisor and founder to large medical –industrial enterprises, and an telecommunications entrepreneur. Doctor Piom believes the near and long time future of medicine lies in applications of the Internet and telecommunications to patient care inside and outside the office. Physicians, he says, hold their destinies in their own hands, and those destinies reside in computer generated data, knowledge, and expertise applied at the point of care and beyond.

If any of my readers out there have any suggestions of other people I might interview who you believe have a credible vision of the future, please let me know who they are.

Thursday, February 11, 2010

Physician Business Ideas: Helping Physicians Leap Into The Net

A few days ago, I ran a blog consisting of a message from Nicos Kakavoulis, MD.

He was describing a physician-patient website, called . He and his “team” developed the site, “ a physician/patient scheduling platform,” to help doctors and patients schedule appointments.

I was intrigued. The central purpose of this blog is to help doctors increase efficiency, productivity, profitability, and, if you’ll pardon a polysyllabic mouthful, connectiveness with patients.

Doctors and patients are having a hard time connecting with each other.

Doctors are short on time, aren’t paid to answer phone calls, are swamped with patients, are trying to cope with higher expenses and lower reimbursements, and suffer income losses when patients don’t show up for appointments or cancel at the last minute.

Patients are frustrated. They may have to wait interminably on the phone to speak to a nurse or doctor. And waiting times to see a doctor are lengthening , as shown in these wait times to see a doctor in Boston.

Average Time To Schedule a Doctor Appointment
Boston, Massachusetts

Days Spent Waiting to See A Doctor

Obstetrics/Gynecology 70 days
Family Practice 63 days
Dermatology 54 days
Orthopedic Surgery 40 days
Cardiology 21 days

Source: Merritt Hawkins & Associates 2009 Survey of Physician Appointment Wait Times

To make a short story long, I called Dr. Kakavoulis to get his side of the story. He is a 31 year old graduate of King’s College in London and a recent graduate of a Columbia University’s MBA program. He and his MBA colleagues have developed They have been working on for nine months and went public for doctors in December.

In doing their research, they were amazed to find that 80% of doctors had no online presence. They also found patients in New York City were having difficulties setting up doctor appointments, and increasing number of patients were cancelling appointments at the last moment.

He said, “So we launched It’s an online scheduler for doctors and patients. We have a web interface. Patients can find available appointments from doctors in their area. Doctors are happy with it. And we are working on integrating with EMR platforms. Also we have built minisites for doctors, an online basic page for their practices. Doctors can quickly build elegant, customized websites for themselves. We give them a unique URL with their name. I was amazed to find more than 80% of New York City doctors have no online presence. The cost for doctors to join is $49.95 for solo practitioners and $39.95 for groups. We want to help make doctors’ practices more efficient, and to help patients find available slots.”

Look at it this way. is an electronic safetynet for doctors who have not yet leaped into the Net.

Wednesday, February 10, 2010

Physician Regulation - Checks, Balances, and Health Reform

Three events marked my day today.

One, I read a flattering review of Atul Gawande’ s latest book, Checklist Manifesto by Robert Wachter, MD, a West Coast academic who is a leader of the patient safety movement. If you’re unaware of Atul Gawande, he is a gifted writer and essayist who is a new doctor hero of the literary elite. He is a Harvard surgeon who serves on the New Yorker staff , where he blasted doctors in McAllen, Texas, for excessive care. He is a champion for more rational and more universal care. In Checklist Manifesto, he argues for a more systematic approach to care with checklists before, during, after surgery and other medical procedures. He says checklists are needed because medicine has become too complicated for even the smartest doctors to understand.

I interviewed Philip Miller, VP of corporate communications for Merritt Hawkins & Associates, the largest physician recruiting firm and AMN Healthcare, a leading hospital staffing company. Phil has written a book Physicians In Their Own Words: 12,000 Physicians Reveal Their Thoughts on Medical Practice in America. In his timely book, he says excessive checks on physician behavior have led to angst and loss of morale, and the physician search for lifestyle balances between work and lifestyle have contributed to growing physician shortage. Miller mentioned, among other things, that medical students tend to look for success in the ROAD specialties( Radiology, Ophthalmology, Anesthesiology, and Dermatology) because of higher ehecks and more lifestyle balances.

Three, I had a spirited conversation with Tommy Hardin, a childhood friend and a Democrat from Oak Ridge, Tennessee, who now lives just outside St. Louis. Tommy was a trifle upset because my blogs favor Republicans over Democrats over health reform issues. True enough. I argued the debate between the two parties is all about checks and balances, as envisioned by our Founding Fathers, who set up the Constitution to set up checks and balances between the Executive, Judicial, and Congressional branches of government. I also argued each party will always give its own spin and interpretation to political events. As Friedrich Nietzsche said, “There are no facts only interpretations.” In other words, if you are either a Democrat or Republican, you will choose to believe what you want to believe, and facts are unlikely to change your mind. Calling the other side "liars" may make you feel better, but it doesn't elevate the level of the discourse.

I would like to encourage readers of this blog to submit more comments. That way, we can engage in intellectual combat, as Tommy and I just did.

Dr. Richard Reece is author of Obama, Doctors, and Health Reform (IUniverse, 2009) and Innovation-Driven Health Care (Jones and Bartlett, 2007) Both books are available at,, barnesand, and other book websites

Tuesday, February 9, 2010

Obama Language - Obama’s Gift of Gab

President Obama declared today that “a sense of purpose that transcends petty politics” must be forged by Democrats and Republicans to create more jobs, reduce the deficit , and find at least some common ground on health care.

“Obama Urges Setting Aside ‘Petty Politics.’ New York Times, February 9, 2010

President Obama has the gift of gab,

He's now goneinto political rehab.

He’s great when talking about collab,

To at bipartisanship to take a stab,

To engage in a health care confab,

He’s ever ready to lift the federal tab.

That’s why Republicans are dubious,

And regard his rhetoric as spurious.

What Obama regards as politically petty,

May be no more than partisan confetti.

Effect of Culture - Health Reform and The Sound of American Culture

My son, Spencer, a nationally known poet on the verge of becoming an Episcopalian priest, was recently quoted as saying of Seamus Heaney, the great Irish poet, who taught Spencer at Harvard and who won the Nobel Prize for literature in 1995.

“Heaney said that poetry was the beat of the tribe – a sound that culture is making. I never forgot that. Poetry is the sound of the soul.”

The noise over government-centered health reform is the sound of American culture. Correctly or not, Americans believe in the sound of individualism, freedom of choice, limited government, access to high tech high touch care, equality of opportunity rather than equality of results.

Whether that culture has a soul is for others to decide.

Medical Trends, Physician Business Ideas: Physician/Patient Scheduling Platform

Prelude: I occasionally receive comments from other physicians that are worthwhile repeating. Here is an example.

Dear Richard: I just read yesterday's article based on Sermo. As you look at trends for 2010, I think patient/physician communication will increase -- for the better.

As you and I both know, physicians face lost revenue when their calendars are not fully maximized, or when patients cancel at the last minute. On the flip side, patients often face frustrating wait times or delays in healthcare delivery. 

HealthLeap bridges the gap by offering physicians an online, on-demand scheduling service that improves care, compliance and practice profitability. Additionally, HealthLeap also offers physicians a specialized, personalized online presence - a simple, elegant personal website that can be created in a few minutes for free.

HealthLeap is a no-brainer for physicians and patients, alike. Sign up is simple – it takes less than two minutes to get started online and there are no restrictions based on specialty or location. Moreover, physicians can either integrate HealthLeap into their existing practice management to reflect available appointments online in real time, or easily showcase only some available appointments online using HealthLeap’s drag-and-drop interface. Once an appointment is booked, automated appointment notifications are sent to the practice and reminders are sent to patients.

Unlike other costly appointment booking platforms, HealthLeap only charges if more than one appointment is generated by the service. Their low price point of $49.95 for solo practitioners and $39.95 for group practices allows physicians to easily recoup the monthly expense from just one new appointment.

As a widely read physician blog, I want to give you and your readers exclusive access to the platform by using the invitation code DRHL10 – your physician readers can use this to register and begin using the service today.

If you are interested in learning more or in speaking with someone from HealthLeap I’ll be happy to arrange.


Nikos Kakavoulis, MD

Nikolaos I. Kakavoulis, MD
Founding Team, HealthLeap

Physician Business Ideas: Coding Conundrum

A conundrum, according to my dictionary, is 1. A riddle whose answer contains a pun (Ex:”What’s the difference between a jeweler and a jailer?” “One sells watches and other watches cells.” 2. Any puzzling question or problem- SYN. See MYSTERY.

What is the difference between a physician and a payer? The doctor offers and sells treatments and the payer offers treatments for what the doctor sells. In other words, the payer decides the price for services the doctor provides.

How this is done is a mysterious process requiring either an inside practice coder or an outside coding consultant, who get their information from elaborate, ever changing coding books and manuals. Consequently, coding has become not only a process, but an industry unto itself.

These codes are arrived by an arcane process developed by Medicare and something called RUC (Reimbursement Update Committee), developed and backed by the American Medical Association . The process is arbitrary, secretive, and byzantine . The codes often have nothing to do with the cost of doing business.

The process has become controversial because 1. RUC is said to be dominated by specialists and therefore rewards specialists and underpays primary care physicians; 2. third parties pay the AMA for use of these codes, which has become the main source of the $300 million required to run the AMA: AMA critics feel AMA revenues should flow from member physicians, not from third parties who decide what and how to pay doctors; 3) Coding is so complicated and mercurial nobody can figure it out.

Controversies aside, proper coding is the key to profitability, for that is how doctors are paid. There are various approaches to coding.

• John McDaniels, founder of Peak Performance Physicians, a practice management firm in New Orleans gives this advice: conduct an annual audit to compare coding against national established bookmarks, competitiveness of fee schedules, and evaluation and adjustments of fee schedules of managed care companies. McDaniels says 80% of doctors undercode, partly out of fear of a Medicare audit.

• James Weintrub, MD, a plastic surgeon developed a website, consolidating contents of coding books and manuals, and allowing doctors to set their own codes. But he quickly found doctors weren’t all that interested in the whys, whats, and hows of coding, and wanted someone else to figure out the precise code.

• Allen Wenner, MD, a family physician developed the Instant Medical History, an onlie set of clinical algorithms, wherein patients could record their history online and produce a complete electronic narrative history, and whereby payers would pay for a higher code because of the comprehensiveness of the submitted claim.

• Daniel Palestrant, MD, a general surgeon who founded and serves as CEO of Sermo. com, has pushed for simplification of coding as a central reform measure to reduce overhead and to allow physicians to see more patients through more transparent billing.

As for doctors themselves, they often escape the complexities and burdens of coding by retiring or going to work as a salaried employee and letting the employer do the coding.

As for me, if I had the eloquence of Winston Churchill, I might say: I cannot forecast the future of coding. It is a conundrum wrapped in a riddle inside a mystery concealed as an enigma

Monday, February 8, 2010

Hospitals and Doctors,- Physician Business Ideas -What’s Galvanizing Physicians And What They Plan to Do in 2010

In early January Daniel Palestrant, MD, founder and CEO of, wrote to the 112 000 physician members of is the premier physician social networking site and on it you will find political opinions, clinical suggestions, diagnostic observations, and hints from a variety of specialists. It is open-ended and open-minded, and on occasion, controversial.

Here briefly, are Doctor Palestrant’s notes on what is likely to take place in 2010:

1. In Massachusetts, the State has started linking licenses to accepting patients. In essence, this is forcing to participate in State programs against their will. Federal programs may soon have the same conditions for practices.

2. New data shows lack of tort reform is costing the U.S. $50 billion a year rather than the $5 billion original estimate. Tort reform is the number #1 reform priority among doctors.

3. The support of the AMA was “bought” by the Obama administration through a “special arrangement” on CTP coding. The AMA makes the bulk of its income, $300 million, through coding, not member services.

4. Mayo’s “opting out” of accepting Medicare patients in one of its Arizona clinics is a sign of things to come.

5. Physicians will continue to pursue alternative business models – concierge practices, cash only practices, worksite clinics, hospital employment, among others – and to abandon third party dependent payment models - in order to stay in business.

6. Ultimately, strain of staying in business and becoming more productive will re-unite patients and physicians and start to squeeze out the countless interlocutors who created much of the inefficiencies in our health care system. It will be a tough couple of years for patients, especially senior citizens and those with lower income, as their access to physicians is increasingly jeopardized as the physician shortage worsens.

7. EMRs are finally gaining momentum. Their greatest application and the reason for their increasing adoption, however, will not necessarily be in improving patient care or creating efficiencies, EMRs hold tremendous promise for establishing more efficient billing and transaction processing. EMRs are becoming a financial imperative, not a clinical one.

8. The AMA will reinvent itself. With less than 1 in 5 physicians actually AMA members, there is much discussion among physicians about a class action law suit, accusing the AMA of misrepresenting themselves as representing this country's physicians and/or pursuing damages from the AMA. While I understand the appeal this holds for so many physicians, I do not think it is in the best interest of physicians in this country or patients. The AMA is well into an effort to re-brand themselves as a public health, rather than physician advocacy organization.

Ideology - End of Partisanship and Beginning of Transparency

They Begin with Listening and Adult Conversations

“Every political community includes some members who insist that their side has all the answers and that their adversaries are idiots. But American liberals, to a degree far surpassing conservatives, appear committed to the proposition that their views are correct, self-evident, and based on fact and reason, while conservative positions are not just wrong but illegitimate, ideological. and unworthy of serious consideration.

Gerald Frank, “Why Are Liberals So Condescending?” Washington Post, February 7, 2010

President Obama has called for a televised health care summit meeting with Republican leaders to discuss ideas for health reform It’s a good move on the part of the President. It could be the start of clarity and openness. It could mark the end of health care partisanship and the start of a genuine political dialogue.

Examples of Partisan Partisanship

Political partisanship have taken various forms – locking Republicans out of meetings, presenting plans that smack of “It’s My Way, or the Highway,” Republicans voting in lockstep against comprehensive Democrat proposals and threatening filibuster, Democrats ignoring the pleas of doctors for tort reform, and accusing physicians of ignorance, greed, and mismanagement , not considering shopping for health plans across state lines, Americans having the gall to suggest that ordinary citizens should have the same health benefits as members of Congress, dismissing even dissing Republican ideas of any form of market-driven or consumer-driven care might save costs and increase quality, federal technocrats advancing the absurdity that bureaucrats know more about practicing medicine than doctors, and, in general, presenting government as the savior of health care.

Game Changers

The election of Senator Scott Brown, the growing strength and momentum of the Tea Party movement, polls indicating two-thirds of the public disapprove of health bills, unexpected elections of Republicans in Virginia, New Jersey, and Massachusetts, forebodings that November elections will be a disaster, has suddenly, inexplicably, and unpredictably turned the political landscape upside dowm.

Elitism Everywhere

Until now, evidence of elitism has been everywhere - born out of ideological arrogance of a super-majority and bred by feelings of intellectual superiority. You can’t deny it. Big Brother, PhD policy wonks, mainstream media, MBA managers, Washington politicians know best. Everybody, it seems, knows best but doctors, patients, and the American middle class.

Disdain – and Fear

The disdain and fear of Tea Party gatherings is palpable. Here, for example, is a comment on February 7 in the Guardian, “Right wing Tea Party types are not cool, but there are a lot of them out there. The Tea Partyers are mostly pasty-faced middle Americans, holding all sorts of smallish, grassroots inbred gatherings.” As if that were a bad thing.

On the other side of the aisle, an awakening, an sudden surfacing of discontent, has exploded. This was expressed by these remarks of a Tea Partyer in Nashville on the Senator Brown earthquake, “I think people recognized at that moment, ‘Gosh, all this resulted in somebody being elected and changing the environment for the entire Obama agenda.’

What’s Good for Us is Good for You

Among Americans, partisanship is ideological and unwelcome . It doesn’t ring true, this idea that: We have more compassion. We are smarter. We have more data. We know what is good statistically for the population as a whole must be good for you as an individual . And we have a monopoly on health care knowledge. Only we know how to fix things.

In their hearts and minds, the people instinctively know this is poppycock. To growing numbers of Americans, this We-ism is elitism at work. En masse, Americans are rejecting the notion that they, the people, are short on brains, childish, and being duped by conservatives.

The attitude of the elite shows in the title of a February 6 article in Slate, a liberal Publication, by Joseph Weisberg, “Down with the People: Blame the Childish, Ignorant American Public – Not Politicians – for Our Political and Economic Crisis.”
Weisberg says Brown ran on the promise he would vote against health reform. To the condescending cognoscenti of Big Government, this is anathema . but it is also the dawning of political reality.

The beginning of the end of partisanship begins with understanding that Government does not hold all answers to health reform. Solutions are bottom-up as well as a top-down. Americans, stuck and suffering in the middle, who receive and pay for that care and who currently have benefits they like and fear of losing , have a few suggestions to make of their own.

Saturday, February 6, 2010

Do-or-Die - Five Reasons Obamacare Tanked

"I mean, to be fair, the status quo is working for the insurance industry, but it's not working for the American people."

President Barack Obama

“The nature of health care is very complex, and sometimes the nature of politics is very simple."

Angela Braly, CEO of WellPoint, America’s largest health insurer, in “A Wasted Opportunity,” Wall Street Journal, February 5, 2010

As everybody knows, life and health care aren't fair. Nice people get bad diseases, health care doesn’t cover them all, and costs keep rising – from 16.0 % of GDP to 17.3% last year.

So what do you if you’re the President of the United States, and the core objectives of your health plan proposal was to bring down costs while covering more people – and both objectives are failing?

You blame somebody – somebody big, somebody obvious. The most obvious industry, the most obvious political foil, is the health care industry. It covers 200 million people, and its costs are rising, projected at over 10% in 2010. And it often doesn’t cover those with pre-existing illnesses.

You neglect to mention that if you confiscated the profits of the entire industry, you would only pay for days of U.S. health care. And you don’t go into other little details , that one-fifth of the budget of WellPoint is devoted to managing Medicare’s fee-for-service clients. Or that to cover those with pre-existing conditions would force health plans to triple their premiums to break even. Or that the fastest growing cost sector is Medicare and Medicaid, not private health plans.

You are not interested in details. You are preoccupied with the big political picture, and you need someone big to demonize.

Also you fail to explain other reasons why the costs continue to rise.

One, health care, though nearly 50% government subsidized, is a cottage industry. Absent private market competition, and consolidation of health care in major cities and regions, hospitals and doctors have little incentive to cut costs. And hospitals and doctors have a lot of negotiating clout when it comes to insurers.

Two, Americans want choice , flexibility and cutting edge technologies to save their lives and preserve their life styles. These things cost money, and Americans are not about to give them up. After all, these things are about “my life,” not some government abstraction to save money.

Three, cutting costs is a state by state problem. Each state has its own insurance regulations, its own set of mandatory benefits, its own premium levels, its own malpractice costs, its own Medicaid budget problems, and its own level of uninsured.

Four, cutting costs is difficult because health care involves deeply personal, complex, and emotional matter, and patients, hospitals, and doctors alike distrust intrusion by government into their private worlds by Internet systems which they fear will put them into some sort of electronic prison monitoring their behavior and limiting their options.

Five, at the core of their culture and their historical traditions, some founded in the Constitution, Americans believe in a weak central , checks and balance, conservative government .

As I said in the start, life and health care aren't fair. This applies to politicians, as well as citizens, who want to change government’s role.