This week, Managed Care Matter’s Joe Paduda hosted Honk Wonk Review’s regular summary of particularly provocative health care posts that appeared in the past two weeks. As always, Paduda’s insights make the Review well worth reading. (I also recommend Managed Care Matters as a blog where you’ll find very smart, objective, fact-based commentary on a wide variety of issues.)
Below, I comment on some of the posts in this week’s Review, but to read the entire round-up (and to find links to posts I mention below) please click here. http://www.joepaduda.com/archives/002013.html
Perhaps the most intriguing post in this week’s round-up comes from HealthCare Renewal’s Roy Poses. An M.D., Poses also has become a relentless investigative reporter, and in this piece he discusses “the fall of an apparently large and prestigious health care charity, which funded research projects at the most well-regarded academic centers – a charity that was involved with Bernie Madoff and some of his confederates.”
If you read Poses’ post (and I urge you to do so) you’ll discover that the charity in question–the Picower Foundation–was not quite what it seemed.
In 2008, Poses observes, both the Boston Globe and the New York Times lamented the fact that the Picower Foundation, which had become one of “Maddoff’s victims” was shutting down. Apparently their reporters hadn’t Goggled “Picower.” Poses calls attention to a more recent Wall Street Journal piece that raises some troubling questions.
Poses then takes us back to a 2001 St Petersburg Times expose of the Picower Foundation “which suggests that its Jeffrey Picower used it in a complex scheme involving self-dealing for the purposes of personal enrichment.”
He ends his tale by asking: “The big question is why people can be so easily fooled?
“Why were a Chief of Endocrinology, the Dean of one of the country's most prestigious medical schools, and a Nobel Prize winner not the least bit skeptical of a foundation whose leadership was accused of conflicts of interest and self-dealing, and had been involved in a series of questionable business deals over the previous 20 years? All this was public by six years before the collapse of the foundation. Why was the media so eager to spin a narrative that labeled the apparent perpetrators as victims? A simple Google search on "Picower" would have suggested other explanations.”
Poses answers his own question: “Certain health care institutions seem to held in such high esteem that almost no one thinks to question what goes on behind their walls. This makes it possible for unscrupulous leaders to subvert the missions of such institutions for personal gain. It even makes it possible for scam artists to create institutions that appear as if they ought to be held in high esteem as vehicles for chicanery.
“We have now seen so much ill-informed, incompetent mission-hostile, conflicted and criminal leadership of health care organizations that no one should accept the word of someone just because he or she is in the leadership of an institution with a fancy name.
“Just because a health care organization has an impressive name, or even an impressive history does not mean that its current leaders should be immune to questions, inquiry, skepticism, or even investigation. In fact, in this day and age, the leaders of large health care organizations with historically good names should be scrutinized especially carefully.”
Moving on the to the Worker’s Comp Insider, Paduda highlights Jon Coppelman’s comments on a NCCI Holdings Inc. study of the relationship between obesity and the cost of workers’ comp claims: “To no one’s surprise, the study concludes that medical costs for the same injury are 3 times higher among obese claimants in the first year, rising to five times higher at 60 months.” With this data in hand, Coppelman adds, “it may be tempting for employers to avoid hiring the obese and find ways of terminating current employees who tip the scales in the wrong direction. This would eliminate many productive people. In addition, it raises the specter of discrimination. The Americans with Disabilities Act protects those with disabilities that impact ‘one or more major life activities.’ This might–but does not necessarily–include the morbidly obese.
“There is a more proactive way to look at the issue,” Coppelman writes. “Employers could focus on incentives to promise wellness. Employees who stay fit could receive enhanced benefits. We have drug-free and smoke-free workplaces. Perhaps it’s time for snack-free workplaces–or healthy snacks. Out with soda machines and in with the vitamin water.”
I like that last idea. Rather than refusing to employ who are overweight, employers might begin to boycott those who profit from selling junk food to all of us. Whether you’re a relatively slim 30-year-old who is three months pregnant, or an obese 60-year-old, vending machines snacks are not doing you any good. But they certainly are tempting. And they lead to “automatic” eating.
We’re taking sodas and high-fat, high-carb foods out of many schools. Why not take them out of the workplace as well?
On-site exercise programs could help everyone feel healthier, including the obese. Research shows that how much you weigh has less to do with health than how much your exercise. Obese people who exercise regularly are far less likely to die prematurely. And they’re happier–which probably means that they are more productive at work.
Writing on Health Affairs, Jeff Goldsmith suggests a solution to the Medicare physician reimbursement controversy caused by the Sustainable Growth Rate (SGR) formula.
For years, Congress has been postponing Draconian across-the-board cuts to physicians’ fees required under the “Sustainable Growth Rate” (SGR) formula. The SGR compares growth in doctors’ fees to GDP growth, and calls for uniform cuts in Medicare reimbursements to all doctors if payments are rising faster than GDP.
The problem is that when Congress passed the legislation in the 1990s, GDP was growing much faster. No one expected that the SGR would lead to enormous cuts in reimbursements that could make it hard for many family doctors to keep a practice afloat.
In addition, the SGR was a crude tool. If you thinks about it for more than a second,you realize that if we want to adjust Medicare reimbursements in a rational way, we would need think about which services provide the greatest benefit to patients. Some Medicare reimbursements should be raised (health reform already legislation raises payments for preventive care) while others should be lowered (see, for example, my recent posts on unnecessary spinal surgery.)
Goldsmith suggests "writing off the SGR "debt" to the federal budget as ‘uncollectable’ and demanding both sacrifice and reform from the physician community in exchange."
Paduda comments: “While I am most certainly reluctant to challenge someone as insightful and knowledgeable as Goldsmith, my inner cynic tells me 'no way'.”
I’m afraid that in this political climate, deficit hawks would reject the idea of writing off the so-called “debt.” (Though ultimately, that is what we need to do.) But there is something to the second half of Goldsmith’s suggestion. I do think that some well-paid physicians are willing to take a modest cut to their incomes as we strive to rein in runaway healthcare inflation .
Already, doctors in various parts of the country are signing up for “Accountable Care Organizations” where they will be paid for the value of services they provide rather than the volume. They will be eligible for bonuses, but since they’ll no longer be subject to financial incentives that encourage them to “do more,” they may find themselves ordering fewer tests, recommending fewer procedures– and spending more time listening to and talking to patients. “Productivity” will be measured in terms of outcomes and patient satisfaction rather than “how many codes did you bill today.” Net, net a doctor’s income might be somewhat lower, but job satisfaction is likely to be higher. No one likes working on an assembly line.
On the other hand, the Health Care Economist’s Jason Shafrin is less than enthusiastic about Accountable Care Organizations. He cites a list of ways that ACOs could run afoul of existing laws. Perusing the list, it strikes me that Shafrin doesn’t seem to recognize the amount of waste in the system, especially when he suggests that we don’t want to build in incentives that might encourage physicians to provide fewer services. He also makes it clear that he supports “physician kickbacks” (his term) and “balance billing” — or shifting costs to the patient. Under balance-billing a doctor who feels that Medicare doesn’t pay enough for a particular service can simply bill the patient for the balance.
The fact that the average Medicare patient is living on $20,000 a year (with very little in the way of savings), and that half of all seniors live on less than $20,000 doesn’t seem to concern Shafrin. Somehow, they are supposed to come up with the money–or forego care.
Then again, Shafrin is an economist, not a medical ethicist.
By contrast, over at HealthCare Technology News Rich Elmore suggests that we probably cannot afford to let every physician charge seniors whatever he feels his services are worth. Elmore offers eye-popping charts which show how much more Americans already pay for doctor’s services and hospital stays.
Finally, on Managed Care Matters Joe Paduda points out that according to the GOP, “repealing health reform will save $700 billion, while Nancy Pelosi (D CA) says it reform will save $1.3 trillion. Who's right?”
“Neither,” says Paduda.
He then refers his readers to FactCheck. Org to analyze the competing claims, noting that, in the end, “CBO's projection that repealing reform would add $230 billion to the deficit is the best available. The CBO itself says that's just an estimate. But it's the best we have.”
“What's the basis for the politico's claims? Pelosi's basing her number on CBO's estimate 20 years out – a looooong time from now, and one so far away as to be beyond nebulous.” I agree. There are so many variables could change over the next two decades that such long-term financial projections are essentially meaningless.
Meanwhile, as for the GOP's claim that "the bill would add over $700 billion in red ink over the next decade,"? FactCheck says we "judge it to be mostly bogus."
“Boehner et al contend that about 400 billion dollars in the CBO's Medicare savings are being "double-counted,” Paduda writes. “But,as FactCheck (and many others) have pointed out, CBO is simply not doing that.”
“The GOP also says reform's administrative costs will be about $115 billion – – that's wildly inflated as well. CBO's pegged these at about $15 billion over the next 10 years.”
I would add only, that as Paduda notes elsewhere in this week’s Health Wonk Review: “the CBO estimate gives very little weight to the Independent Payment Advisory Commission (IPAC), a potentially very strong cost control mechanism.”
Under the Affordable Care Act, if Medicare spending rises over a certain amount, IPAC is required to come up with ways of reducing Medicare spending without cutting benefits or shifting costs to patients. IPAC does not need permission from Congress; legislators can over-ride IPAC’s suggestions only if they can find a way to achieving equal savings without reducing benefits –or raising co-pays and deductibles. That will be difficult since any cuts in spending will step on some lobbyists’ toes. This may be one reason why legislators who crafted the reform bill turned the problem over to an independent commission. (This is the same strategy they used when it came to closing military bases in the U.S., another issue fraught with special-interest politics.)
It’s worth noting that drug-makers are aware of just how much power IPAC has, and this is a plank in the health care reform that they would like to deep-six. They are particularly concerned that IPAC will recommend that Medicare avoid cost over-runs by refusing to shell out exorbitant sums for some high-priced drugs–especially when clinical evidence suggests that they are of little value.
In my humble opinion, Big Pharma has reason to be worried. And, as Paduda suggests, CBO may not have given as much weight as it should to IPAC’s ability to “break the curve” of Medicare inflation. But to be fair, CBO is only supposed to count savings that it can “score.” It’s impossible to guesstimate just how much IPAC may save.