In response to the questions I raised in two posts below about the hospital
building boom and whether we need—or can afford—hotel-like amenities, Dr. Terry
Bennett sent HealthBeat the story below. It’s a provocative insider’s look at
how a local hospital is raising the money for an “expansion” that, according to
Bennett, seems to have very little to do with improving the health of its
patients or the local community. Part problem is that CEO’s of non-profit
hospitals have begun to think like CEO’s of for-profit corporations: growth is always
good.

“If you own all of the doctors’
practices that refer to a community hospital—as the CEO of our local hospital does–
you can dictate where, when and for how much every single patient is seen,”
Bennett writes.” For example, you can make sure that all urgent cases are seen
in your hospital’s ER at $1000 a head. (Medicare and Medicaid pay less than a
grand for a "bare bones" ER visit, but if you order an EKG, an x-ray
or two, and a few lab tests, you can push the visit up to over $1000).

“Do that 100 times a day
and you have millions [of dollars] which you need to cause to vanish as quickly
as possible. [Otherwise the Centers for Medicare and Medicaid services may
question how a not-for-profit could be making such rich profits, and start to
examine your books.] Thus the Atria, the waterfalls,the new facades, the many
other flashy dashy add-ons, the services no body really needed.

“The CEO of our local hospital hates me.
Because my patients can reach me 24/7, I have the lowest ER admission rate
of any physician on the staff at my local hospital. I treat over the phone, see the next day, am always on the prevention line of
chatter, etc. [In other words Dr. Bennett is not helping the CEO fill the
hospital’s coffers].

“Meanwhile, our hospital, is in the midst of a $45 Million ‘expansion’— no
new beds, no new services, but $45 million is being buried, and ‘non profit
status’ is preserved. It is happening in almost every community across the USA.
Such antics make any healthcare budget, Medicare, Medicaid, or HMO, completely
unpredictable and are bankrupting the entire present system and all of its
budgeting assumptions—and will continue to do so until forcibly stopped.”

Dr. Bennett also included a copy of an Op-ed which originally appeared in two
New Hampshire newspapers, the
Portsmouth Herald and the Rochester Times. Below, an edited version:

Health care issues in the new millennium
By Dr. Terry M. Bennett

It seems like only yesterday, but it was in fact 16 years ago, 1992, when I
ran for a New Hampshire Senate seat proposing a single-payer Medicaid-based
national health care plan using our Social Security numbers for identification.

The plan was six pages long, and a sixth-grader could have read and
understood it.

I did not win the primary.

At that time 45 million U.S. citizens were uninsured; they still are. Health care is in even greater crisis; shall we sit down and reason
together?

First question is:

Is it reasonable to run health care as a business? If yes, it means that we
agree that health care should be running profitably, and that extraordinary
profits are OK for entrepreneurial types who think their efforts are worth
millions or even billions of dollars, and that it’s OK to manipulate everybody,
from patients to providers, and to effectively exclude all the people who
cannot pay, or marginalize them in some way, so that they and their demands do
not interfere with the profitability of the business of health care.

Parenthetically, we should note that the whole concept of
"profitability in medicine" is recent.When I graduated from medical
school 42 years ago, and for all of time before that, medicine was run as a
charity.

All hospitals essentially lost money, all physicians were self-employed and
had sliding-scale fees so that poor people were included graciously into
practices where they could pay fees ranging from nothing at all to some partial
fee.

This was the norm for many centuries.

In the mid- to late-20th century, Sen. Bill Frist’s father
"invented" the concept of "profitability" at hospitals.
Frist proceeded to buy numerous previously unprofitable (they were defined as
nonprofit and had the audacity to actually be nonprofit) community hospitals.

Frist set about to organize them as profit centers and then run them as
corporations, which meant employing draconian measures, such as shipping
patients unable to pay off to other hospitals, overbilling and thereby cheating
Medicare, which they were repeatedly convicted of doing.

Frist became a billionaire. (Frist Jr., –Senator Frist– is only a
multimillionaire, and a minority
stockholder.)

It did not take long for CEOs at other hospitals to learn these fiscal
lessons, and a paradigm shift in hospital behavior occurred within the next
decade or so.

It is not just hospitals that have changed their ways. Doctors have
transmogrified. . .

A large part of the debacle [in
the medical profession]
begins, unfortunately, with the indebting of young physicians. The average
young physician owes more than $250,000 upon graduation. There is no way that
kid will be an altruist ever again.

If you lose your altruists early in
the game, who is left to take care of the poor? [my emphasis—mm]

Primary care physicians are not well paid at all, and, additionally, have to
deal with the brunt of the HMO greed/foolishness, and find a way to get
impossibly expensive drugs into their patients over HMO outcry. It is an
impossible task.

This unwelcome development means that there are fewer family doctors and
primary care physicians because the pay is not that good, the debt is enormous,
the daily hassle of dealing with the HMOs and other obstacles escalating daily,
and the incentive to enter this care format minimal.

The young indebted doctors opt for employee status, because no risk-taking
is necessary. They go to work for "the man," get a predictable
paycheck, go home at five. It is a totally different mindset, not at all like
the old docs that Norman Rockwell portrayed

The upshot is that hospitals have come to own all the means of
production.They own the beds, they own the operating rooms, they own the
physicians and the practices that refer patients to the hospital, and in so
doing, they can dictate how, where and how much it costs to be seen in their
wholly owned enterprise.

The money rolls in, as it tends to do in any monopoly.

Hospitals are still carried on the tax rolls as "nonprofit
agencies," and as such, must figure out what to do with the actually
enormous profits that are generated by diverting outpatient visits into the
emergency room.

The result? Never-ending building
sprees, at every formerly small community hospital in the USA.

What is the sum total of all this ?

1. We spend more money per capita than any other country in the world on
health care.

2. Somewhere more than one-third of us are uninsured, and consequently
underserved.

3. Formerly small community hospitals, which once provided a broad spectrum
of care, including substance abuse care, psychiatric care, and other types of
care that were not profitable, have ceased delivering these services, and are
referring Medicaid and Medicare patients, formerly seen in the outpatient
departments, to the Emergency Department, where the fee jumps from $40 or $50
to $1,000.

4. These "nonprofit" entities are building new and splendiferous
hospitals, daily, on the "nonprofits" they have garnered by altering
their care patterns

5. Community physician turnover is enormous, because they have no investment
in the community where they work, and there is always another hospital employer
recruiting, at a slightly better salary, because their previous physicians
were/are unsatisfied and have left that community.

6. Very few doctors come anywhere and stay there for their entire careers.

7. Continuity of care suffers because the patients are not really assigned
to individual physicians, but instead, belong to the hospital-owned practice.

8. Not knowing your patients leads to a marked increase in hospital admissions,
and in emergency room visits, because it is not possible to be flexible, to
treat over the phone and see the next morning, as all the good old boys did in
the good old days.

So, now let us reason together:

If we agree that the game, the only game we will agree to, is to provide
health care services to every single American regardless of his or her ability
to pay, and not go bankrupt doing it, we need to do a number of things:

First, agree that health care is an inappropriate arena for the formation of
new billionaires, then:

1. Subsidize the education of all U.S. medical students, thus preserving their altruism, and their willingness to
become primary-care providers, as of old, in hopes that we can reconstruct a
successful model of long-standing.

2. Dismantle HMOs. They have never lived up to their promises. Instead of
passing savings back, their owners stole the savings, and then sold the
enterprise to large insurance companies, which have never had our interests in
mind, when our interests conflicted with their profits.

3. Legislate the provision of outpatient services at outpatient rates by
every hospital in the United States that continues to own medical practices. Fine any hospital found referring
non-urgent cases to emergency rooms.

4. Legislate world pricing for all pharmaceuticals. This would mean that a
U.S. consumer would pay the same price for any drug as any other person
anywhere else in the world would pay for that medication, instead of five to 20
times more for the same drug. Until this is achieved, the upwardly rocketing
cost of pharmaceuticals will sink any health-care system conceived.

5. Stop thinking of health care as a business, but consider it as a
necessity that should be provided at the most reasonable cost in the most
humane way to the largest number of consumers possible, rather than the most
expensive services provided willingly only to those fortunate enough to be
wealthy or well insured.

6. Stop the siphoning off of huge sums into "profit" at any and
all levels of the care industry.

7. Understand that the money can only be spent once, and if it is to buy
health care, not a lifestyle for some administrator, then it behooves us all to
watch it carefully and demand our money’s worth.

8. Single-payer Health Insurance, modified, as already found in England and Germany, is
alive and well.

9. We do not have to "reinvent the wheel," it merely needs to be
investigated, then harnessed appropriately.

10. In those countries, everyone has the equivalent of government-issued
Medicaid.

11. The affluent can buy additional private insurance to "facilitate
their care."

12. Nobody is left behind.

13. No billionaires created.

14. No building sprees at community hospitals tolerated.

15. No outrageous drug prices unique to the United States and nowhere else in the world.

16. These scourges, smoking, obesity and drug abuse, will bankrupt any
system, no matter how well conceived, unless arrested forthwith.

Any questions?