Archive for category Control of Health Care
Force Field Analysis
Based on the above analysis the forces against the idea of Medicare-For-All seem slightly stronger. Of course, the scale may shift as the 2020 presidential campaign progresses.
Underlying philosophies are force drivers:
- Market forces should set cost
- Poor health literacy invalidates a free market
- Once people have a social program they want to keep it
- Healthcare is a right
- Innovation requires high profit
- Other developed countries provide healthcare at half the cost as in the United States
- Danish style healthcare only applies to Danish people, not the diverse population in the U.S.
- Poor people in the U.S. receive poor care
- Humans prefer the devil they know rather than the devil they don’t.
Ralph Waldo Emerson is not usually associated with healthcare. However, his famous quote about consistency may apply. The US healthcare system seems to be quite consistent, in a bad way.
The Perspective section of the September 7, 2017 edition of the New England Journal of Medicine featured an opinion article by Eric Schneider and David Squires. The essence of the article is to point out the US healthcare system has a lot of potential, receives lots of money, discovers great treatments and has some institutions that really deliver good care. The authors suggest with a change in focus US healthcare could be number one in the world. Yet, it is not. And, it maintains a poor rating CONSISTENTLY.
The authors state key strategies for improving healthcare:
- Timely access to care (preventive, acute and chronic)
- Delivery of evidence-based and appropriate care services.
They note several things that stand in the way of delivering care of any type:
- Cost of care (US is number one)
- Administrative burden (US is number one)
- Disparities in the delivery of care (US rates very high)
In any large US city the profusion of stand-alone emergency rooms is testament to the failed notion of high-cost rescue treatment rather than low-cost prevention or ongoing monitoring and early intervention. The US tends to invest in high-cost drugs, treatments and surgeries and under-invests in primary care and social services. The failure to adjust the focus of healthcare efforts has become a financial train wreck.
The authors of the above article present four prescriptions for US healthcare:
- Improve access to care
- Increase investment in primary care
- Reduce the administrative burden
- Make healthcare more equitable, so all people can receive good healthcare
However, those lofty goals require something else. The US must stop the foolish consistency of accepting poor health care, of paying too much for healthcare and believing great inventions automatically lead to great healthcare.
Perhaps the Emerson quote is too painful. An Albert Einstein quote may be better:
“The world we have created is a product of our thinking; it cannot be changed without changing our thinking.”
The above chart is from data just released from the National Resident Matching Program. This is about doctors who completed medical school and now according to their preferences are matched with training programs in various specialties. This is for the first year of residency, but it should be noted physicians may branch out to other specialties later in training. Internal medicine is a good example since those physicians branch out to later be general internists, hospitalists, cardiologists, pulmonologists, gastroenterologists, diabetologists, and nephrologists among others.
The point of this chart is to show how the shortfall in US physicians is being filled by foreign physicians. The foreign physicians are good doctors, in fact, some of the best in the countries they come from.
The obvious question is WHAT IS WRONG WITH THE US PHYSICIAN TRAINING PROGRAM? It obviously is not keeping up with demand. Thousands of US students desperately want to go to medical school, but there is no place for them. Certainly, cost is a definite issue — many who would like to go to medical school just can’t secure the funding or don’t want to go into debt for hundreds of thousands of dollars. So, the inadequacy of US medical training is resolved from afar.
Other countries, like the UK, solve this problem by offering aspiring doctors the funds to go to medical school in exchange for becoming a specified type of doctor and practicing (for a number of years) in a specified location. It seems to work.
Attracting good doctors from other parts of the world sounds attractive but it’s not so nice for those other countries losing the doctors. The US has a significant physician shortage which is getting worse. Since the US does not have a healthcare system it is not possible to respond to the shortage. The free market system fills the lucrative specialties in the nice locations leaving the non-urban communities to go without or hopefully attract a foreign medical doctor. In many rural communities there are no US trained physicians.
US healthcare quality is at the bottom of industrialized countries. Access to healthcare declines in large part due to a shortage of providers. Since there is no organized healthcare system no resolution is in sight. It’s staggering to realize even Cuba has more doctors per capita than the US. The discussion and legislation so hotly debated currently seems oblivious to the shortage of physicians for which insurance is no solution.
Start over. Begin again. Throw out the mess.
Usually, complicated problems are solved incrementally by finding each small problem and fixing each one until the huge problem is resolved. This approach has failed healthcare in the United States. The evidence is overwhelming.
- rising cost
- declining health
- inability to train enough workers
- high infant mortality
- inability to control drug costs
- focus on cost instead of health
- fragmented improvement efforts
THE UNDERLYING PROBLEM IS THE US DOES NOT HAVE A HEALTHCARE SYSTEM: NO SYSTEM TO CORRECT, NO SYSTEM TO MEASURE, NO GOALS TO MEET, NOBODY WHO IS ACCOUNTABLE.
The measure of a healthcare system is an average. It’s not whether one guy is cured from leukemia but whether the average baby survives, the average citizen can get a doctor appointment, can purchase medications, and can have surgery if needed.
Sadly, if you are a legislator every problem looks like a financial problem — you can pay more or pay less. You tried the first option so now you want to try the second option.
Supply and demand economics does work But, it just has to be applied the correct way. If the salary paid to a lawmaker is dependent on improving health in the country then the economic theory would work fine. It does not work fine when complicated treatments are marketed to a population with low health literacy (and that includes the President and Congress past and present).
The reason Medicare-for-all seems so appealing is because it is a system. Perhaps it’s not as good as the systems in other countries, but it’s the system we know. It’s time to stop complaining about cost and complexity. DO SOMETHING and KEEP IT SIMPLE.
What an opportunity! A design for American Health Care that is badly needed, a blank slate, an open door, a blank check. So what blogger could resist the obvious invitation. First is the logo — I hope you like it. No more Medicare, Medicaid, Indian Health Service, Veterans Administration, Blue Cross or United Health.
Who gets AHC? Well, every US citizen.
How much does it cost? The annual out of pocket cost is limited to just $1000.
Is there any paper work? NO. No paperwork, no bills, no EOB, and no insurance claims.
What do you need for healthcare? Just your AHC card.
What is the price list?
- Office visits: $25
- ER visits $50
- Thirty day prescription $10
- Surgery $100
- Hospitalization $200
- Medical equipment $75
- Medical devices $75
- Ambulance $100
What is the national healthcare budget? It’s set by congress. Initially budget neutral at three trillion dollars (or whatever budget neutral at this time).
Where does the money come from? Taxes. Instead of insurance premiums it’s included in your taxes.
Do insurance companies go out of business? No. They process claims from healthcare providers, pharmacies, hospitals etc. The person getting healthcare does not need to be involved with all the paperwork.
What government agency runs the program? Medicare, under the AHC name. Providers bill the claims processor and AHC pays the processor.
Is great American health research affected? No. This is a health care system. Research is not health care and is outside the system.
Can people obtain health services, like for cosmetic surgery? Sure. Any services you want to purchase yourself outside AHC is fine. But, you still pay the same taxes. AHC does not pay for private care.
Are the States excluded? No. The States are responsible for managing AHC in their States. The Federal Government sets the standards for the country. The States make it happen.
Why would national costs be lower? Because America as a country negotiates prices and because cost would be capped by the congressional budget for care. The cost would be the same the first year. Waste is a major problem — with better management of a system waste can be addressed. Since about one half of US healthcare cost is consumed by waste there is lots of room for improvement.
What about poor people? The deductible would be lower than $1000 — but because the deductible is low to begin with not many would need this help.
Now would be a good time for the applause. Your humble blogger thanks you.
The U.S. healthcare system is going to change or at least be updated in the coming years. So, when congress tinkers with the system what might be good changes and what might be bad changes? That is the $3 trillion dollar question! It would be fair to say most people and most congressmen do not understand U.S. healthcare — the prevailing notion is overwhelming complexity and way too much cost. However, this blog is going to make the case the key to understanding and the key to making changes is to keep your eyes on the results.
What results? It’s not complicated, it has to do with measurements. Consumer Reports and J.D.Power know we want to buy value. And, value in this case is the reasonable cost for wellness, longevity and successful treatment of disease. That’s it, three things. Whatever changes or tinkering are contemplated we just need to know those three things will be getting better and simultaneously costing less. Politicians have a really bad habit of saying the changes they propose will do the job. Nobody can predict what will work — there are always unintended consequences — so, any proposal must include a dedication to measuring the outcomes we want — if the change does not work it needs to be discarded as soon as possible. And, discarding what does not work can’t wait for the next election and should not wait until tomorrow. Simply, we want results, and we want the data as proof. On a hopeful note, if something works, keep doing it.
The above diagram describes U.S. healthcare. It is more simple than the systems in other countries. The system is linear — people, illness and unlimited money on the left side pass to the results on the right side. This is a flow diagram of the system. The complexity can be hidden by thinking in terms of the five boxes. Later, some of the complexity will be discussed. First, consider the boxes:
- Money to pay for the system. The money people earn is paid to the health care system. Money is money — it does not matter if the money comes by way of taxes, insurance or cash. Funds that do not come from insurance come from the other sources. This is the cost of U.S. healthcare which is about $3 trillion. Don’t pay the money, you don’t get healthcare.
- The healthcare providers. Traditionally we only think of doctors, hospitals and drugs. We often overlook the other things in the box. Things we don’t like, things healthcare providers would like to see in another box. These other things are hugely expensive and fully under the control of the healthcare providers. Unnecessary treatment is perhaps one of the worst — treatment or tests that are not needed. For example, an EKG done as part of a yearly exam on a healthy person. Profit is in this category. Clearly, no profit, no healthcare system. But, profit beyond what is needed is just waste for the system — it is money that leaves the system and does not come back. Inefficiency comes in many forms. Failing to prevent diseases early, only to spend more money later is supremely inefficient. Corruption is a problem in every human endeavor. Errors turn huge amounts of money into waste. The money spent on medical liability suits is just the tip of the iceberg. Money spent to prevent errors is minuscule compared to the money spent on drug marketing.
- Who gets healthcare? Everybody. The aggregate need for healthcare is fairly stable for the system. But, for an individual the need is hugely variable — an auto accident is not predictable. And, when disease strikes most of us can not afford the cost without insurance. Statistics show 50% of Americans do not have access to $4oo for an emergency. The very people who don’t have emergency funds are the very people who do not want to purchase health insurance. Sadly, those people end up in bankruptcy while the system grudgingly provides the care. Now that more people have insurance those without may find less compassion from the providers. Many feel there are freeloaders in the system — people who do not contribute. Does a birth defect, mental illness or low IQ make people freeloaders — that’s an ethical question which is beyond the scope of this discussion.
- Waste. In monetary terms this about $1.5 trillion dollars per year with a huge death toll in the US. A hospital acquired infection is very expensive and kills many of those affected. The high profile infections from spinal injections are just the tip of the iceberg, again. Re-hospitalization for an unresolved health problem is another example. Paying $800 for a $10 epinephrine injector is another example.
- The results. We want those good results. Not just for cancer patients, not just for heart attack victims, not just for you, but for me too. We don’t want promises, we want results. In this age of smart phones and millions of apps there is no excuse for failing to have the data to prove the system is working in our hands every day. We want the results today, not after several years of scrubbing the data in some moldy university. We all must keep our eyes on the results and hold our elected officials accountable.
Complexity. Medicine is a science and by its nature is very complex. Open heart surgery is a good example — there are few people who understand the issues involved. But, the system, from the patient’s view does not need to be complex. In one country the cost of hospitalization is $400/day — the people there know exactly how much the illness will cost. In another country, the prices of office visits are posted in the waiting room — it does not matter what insurance company you might have. In another country all the providers use the same medical record system — not a big deal to move or see a consultant. We seem to tolerate the complexity of our system and think it should be as difficult to understand as heart surgery.
The US pays about twice what other countries do for similar or better care. There is enough money in our system now. Our problem seems to be in the area of wasted money and effort. It seems unlikely that just reducing payments to providers will reduce errors and wasted money — this supply-side economics does not get to the real problem. More than likely, lower payment to providers will only result in lower income for them and perhaps more errors and unnecessary services. But, if it works, do it.
Back to the initial warning. Keep you eyes on the results of the system and the cost. Whether any economic hypothesis proves correct is irrelevant. What matters is the system must move in the right direction, always.
There is a lot to recommend the quality improvement method called “Plan – Do – Study -Act” or PDSA. The idea is to plan a change to a system of care, do the plan, make measurements to study the results then act to change the system to get better results. This is an ongoing process. Congress seems to be mired in a system of management which is one hundred years out of date — if anything, that’s what needs to change first.
The people in the United States pay more for drugs than any other country. And, they pay more to universities to do drug research than other countries. In a nutshell, it is due to a lack of regulation in the U.S.
Drug companies constantly complain regulations are hurting profits. Now it appears without enough regulation drug companies are hurting sick patients. As big pharma points out, it’s all legal. Basically, big pharma points a finger at the US Congress for not imposing restrictions common in the rest of the world. Sounds like a circular argument!
Between the two articles linked above and this author’s experience here are the reasons:
- Abuse of patent laws
- Driving small drug companies and generic companies out of business with frivolous but highly expensive suits.
- Release of a similar drug before a patent expires and manipulating doctors and patients to change to the new drug suggesting the similar drug is “MUCH” better (evergreening).
- Paying new drug makers to delay marketing their competitive drug (pay-to-delay). While at the same time asking for a fast track through the FDA approval process.
- Claiming a new drug is novel when by any reasonable standard it is not (asthma inhalers are a good example).
- Coupling devices to drugs to double the difficulty for competition (like insulin pumps).
- Failing to pay their fair share of basic drug research, funded by the US government instead.
- Happily doing “inversion” deals to move headquarters to other countries to evade US taxes — into the very countries that strongly regulate drug company profits.
- Voluntarily limiting profits in many countries due to the threat of regulation, but failing to offer the same deal to the US.
- Lobbying successfully to prevent Medicare (a larger health program than the NHS in the UK) from negotiating prices as the UK has done for many years.
- Blackmailing patients to pay for old drugs at exorbitant prices because generic companies are afraid to compete (pricing because-they-can, oral beclomethasone is one example).
- Preventing drugs from other countries to be sold across borders because of unfounded safety concerns (crocodile tears).
- Actively avoiding drug comparison research — forcing others to do that type of research after the drug is already marketed.
- Doing cancer drug research with endpoints (such as tumor size) rather than life expectancy. 85% of cancer drugs now have no connection to the most basic expectation of patients, to live longer.
- The WSJ review of 40 drugs administered in physicians offices: 39 cost less in the UK, 37 cost less in Norway and 28 cost less in Ontario Canada. The price gouging in the US certainly suggests racketeering.
- Drug company profits are 17% in the US and 7% elsewhere.
- Actively avoid cost-effectiveness research — prescribers don’t know whether a new drug is better or worse than old drugs except by what is told to them by marketing. (Unlike the UK drug system which is strongly linked to cost-effectiveness)
- Drug companies hide special deals with large customers so other customers have no idea of the low end of the price spectrum. The companies are so large that a lone US State can not leverage deals needed to lower prices like countries can.
Perhaps I have missed some other corrupt practice or unethical behavior, there are just so many. This mess needs to be cleaned up! At very least the US Congress needs to institute controls similar to other countries. Feel free to send this blog to your congressional representative — with a copy of your drug bills!
Health care lobbyists are not your friends. They do not promote quality health care, instead they promote health care business profits. If only hundreds of millions of dollars could be spent on lobbying for health care quality, on health care access, and on lowering health care cost then the US might not be last in the quality ranking for industrialized countries. The data below are from the Center for Responsive Politics. The table shows the amount of money spent for lobbying in 2015 for various industries. Any wonder why we don’t see much change?
|Industry||Total (millions)||X = 10 million $|
|Oil & Gas||$97||XXXXXXXXX|
|Electronics Mfg &
|Misc Manufacturing &
|Health Services &
|Civil Servants &
Piecework maximizes human productivity. Make more things, get more money. Garment workers and physicians both have been paid under this system — it’s great if the payment per piece is high but miserable if the price is low. Because piecework itself is no guarantee of quality inspectors were invented to reject low quality products. Thus, the little piece of paper in your new shirt pocket “Inspector 23”.
What if you went to a doctor’s office and had to be inspected before the doctor was paid? You had to have that little piece of paper “Inspector 23” to submit an insurance claim. That’s never going to happen but you get the idea. The doctor is paid by the number of services but the service should meet a quality standard.
This example is just the tip of the iceberg. Medicine is discovering process control without much input from the well established engineering field of process control. It’s sad, and perhaps a little arrogant on the part of medical administrators and law makers, to ignore the extensive work on process control. People do not like to be considered as little boxes in a system diagram — understandable — but a failure to think in this way is wasting trillions of dollars. The time for change has arrived.
The black box of medical care is what happens with the doctor-patient interaction. 1) A patient enters the office, operating room or x-ray office then health care happens then 2) the patient leaves. As it stands now the physician is paid by the number of services performed so the possible process control at points 1 and 2 are wide open. Nothing is measured, nothing is controlled, and quality is not guaranteed.
Now, consider modern process control with 5 control points, a measurement point and feedback to control the input to the black box of health care. What is in the black box? Perhaps just one health care provider. Or perhaps many health care providers. Instead of a black box it might be a grey box with lots of individual elements.
At the highest level of abstraction the feedback loop is intended to minimize cost but at the lowest level the feedback loop is intended to maximize quality. To make sure throughput is maintained the providers need to be paid by the number of services performed but the flow of patients is choked off if quality is not adequate.
This is rocket science. But, as Einstein says, a system “should only be as complex as needed”. Health care is very complicated and at the present the garment industry is not the model the world should be using. Simplistic ideas of supply and demand are not adequate to make a rocket fly nor to control cost in a health care system.