Wednesday, June 24, 2009

The Problem with Healthcare

The soaring cost of healthcare and healthcare insurance is called a crisis. Many people talk about the crisis in healthcare but few ask, where did the crisis come from? As if healthcare is somehow preordained to be in a perpetual crisis by its intrinsic nature.

The simple and obvious truth is, the healthcare crisis is caused by medicare. What is medicare? It's socialized medicine but it's only socialized for a specific segment of the population - the elderly. Any American of a certain age automatically qualifies for medicare and at that point, their healthcare is paid by the government which of course, gets the money from the rest of us via income tax.

Medicare was created in 1965. Before 1965, seeing a doctor or going to the hospital was just like having car trouble or seeing the dentist today. It was an extra expense that was unanticipated and unpleasant but you could deal with it and pay for it out of your own savings. Today, very few people could afford a trip to the hospital. The simplest thing, like a broken leg, is outrageously expensive. Since healthcare is outrageously expensive, naturally the insurance is going to be expensive also.

How did medicare cause the current high-price crisis in healthcare? Remember the principle of supply and demand? The senior segment of the population gets free socialized medicine. Since it's free, there is no control on the demand for healthcare by the elderly. They can go to the doctor as much as they want and the taxpayers will pay for it. They can get expensive MRI scans and drugs as much as they want and the taxpayers will pay for it. MRI and other amazing technology will be invented and implemented at a fast pace because medicare guarantees a deep pocket to pay the inventors and make them rich. And on and on. Socialized medicine has created nearly unlimited demand. High demand means high prices. There's no getting around that.

What if the government decided that all young people between the ages of 16 - 30 have a right to any car of their choice and as many cars as they desire and the government will pay for everything? Car prices would skyrocket just like healthcare prices have skyrocketed. There would be unlimited demand for new cars. Young people would use their government car ticket to buy Porche's and Ferrari's. Some would buy American cars but even the least fancy car acquired by a young person would have all the bells and whistles and extra charges. Car makers would start inventing faster and more impressive cars because there's a guaranteed market to the young people and price is not a problem. New technology would be invented at a fast pace because it's guaranteed to sell to the young people. Meanwhile, prices would skyrocket and the rest of us would have to start riding a bus because owning our own car would be out of reach.

How can we fix this problem? First, recognize and understand the source of the problem. Then, there are quite a few options. We could begin to place restrictions and limits on medicare to slow down the demand. We could eventually phase out medicare but, hopefully, it would be done over a long time span and with the least amount of pain inflicted on the elderly who have grown up paying their share of medicare taxes and expect to be taken care of.

Another possibility is to let young people in the work force sign a contract stipulating they only have to pay half the normal medicare tax but will not receive medicare when they get old, benefiting them now and for the rest of their working life and benefiting society later.

Another possibility is to go the other direction and completely socialize healthcare for the entire population instead of just for the elderly. That would certainly be more fair than the current system. If healthcare is completely socialized, access to healthcare will naturally be restricted (no economy could possibly enable everyone to have as much as they want the way seniors do now - that's as impossible as raising the minimum wage to $500 per hour), quality will go down (from the perspective of wealthy people who get everything they want from our current system) and the system will either bankrupt itself or access will be restricted to an equilibrium point where people are willing to live with the level of service and willing to live with the taxes to pay for it at the same time.

It's possible that if healthcare is socialized completely, eventually the healthcare system will suck so bad that people will finally realize it's bad and get rid of the socialism and move back to a free-enterprise approach to healthcare. Completely socializing medicine could actually be a step towards getting rid of socialized medicine. And, if healthcare is socialized completely, at least it would be more fair than the current corrupt and broken system that only benefits a specific segment of society.

Here's an article from the New York Times which clearly illustrates how seniors are using the medicare system in Florida:
September 13, 2003

RE-EXAMINING MEDICARE

Patients in Florida Lining Up for All That
Medicare Covers

By GINA KOLATA

BOCA RATON, Fla. - It is lunchtime, and the door to Boca Urology's office is locked. But outside, patients are milling about, calling the office on their cellphones, hoping the receptionist will let them in. To say they are eager hardly does them justice.

"We never used to lock the door at lunch, but they came in an hour early," said Ellie Fertel, the office manager. "It's like they're waiting for a concert. Sometimes we forget to lock the door and they come in and sit in the dark."

Yet few have serious medical problems, let alone emergencies. "It's the culture," said Dr. Jeffrey I. Miller, one of four urologists in the practice.

Doctor visits have become a social activity in this place of palm trees and gated retirement communities. Many patients have 8, 10 or 12 specialists and visit one or more of them most days of the week. They bring their spouses and plan their days around their appointments, going out to eat or shopping while they are in the area. They know what they want; they choose specialists for every body part. And every visit, every procedure is covered by Medicare, the federal health insurance program for the elderly.

Boca Raton, researchers agree, is a case study of what happens when people are given free rein to have all the medical care they could imagine. It is also a cautionary tale, they say - timely as Medicare's fate is debated in Congress - for it demonstrates that what the program covers and does not cover, and how much or how little it pays, determines what goes on in a doctor's office and why it is so hard to control costs.

South Florida has all the ingredients for lavish use of medical services, health care researchers say, with its large population of affluent, educated older people and the doctors to accommodate them. As a result, Dr. Elliott Fisher, a health services researcher at Dartmouth Medical School, said, patients have more office visits, see more specialists and have more diagnostic tests than almost anywhere else in the country. Medicare spends more per person in South Florida than almost anywhere else - twice as much as in Minneapolis, for example.

But there is no apparent medical benefit, Dr. Fisher said, adding, "In our research, Medicare enrollees in high intensity regions have 2 to 5 percent higher mortality rates than similar patients in the more conservative regions of the country."

Doctors say that Medicare's policies are guiding medical practice, with many making calculated decisions about whom to treat and how to care for them based on what Medicare covers, and how much it pays.

"The bottom line is that the stuff that reimburses well is easier to get done," Dr. Carl Rosenkrantz, a Boca Raton radiologist, said.

Thomas A. Scully, administrator of the Centers for Medicare and Medicaid Services, said he knew the situation all too well.

"We have a system that does nothing to look at utilization," Mr. Scully said in a telephone interview. "If you send in a bill and you are legitimate, we pay it."

The effect shows up in the way doctors deal with office visits, for example. Medicare in Boca Raton pays $52.46 for a routine visit, in which a doctor sees a patient with no new problem. That is not enough, doctors say; it costs about $1,500 a day to run an office there, they explain. Payments in other states are different, adjusted for cost of living, but doctors say, and Mr. Scully agrees, that they are generally inadequate. Doctors who try to make a living seeing only Medicare patients for routine visits, he said, "have a very rough time."

Medicare bases its payments on a system in which each kind of service is assigned a "relative value," Mr. Scully said. To increase the payment for routine office visits and stay within its budget, Medicare would have to decrease the relative value of other services.

A committee of doctors meets each year to suggest relative values, he said, but "the most aggressive and active groups tend to be the specialists."

"Year after year," Mr. Scully went on, "the specialists come in and make a very strong argument for higher reimbursements. There's eventually a squeeze on the basic office visit."

In many areas of the country, private insurers pay more for office visits than Medicare does, so doctors can essentially subsidize their Medicare patients.

"If we just saw Medicare patients and didn't see anyone with regular insurance, we wouldn't be able to pay the bills," said Dr. James E. Kurtz, an internist at Chatham Crossing Medical Center in Pittsboro, N.C.

Elsewhere, many doctors are refusing to see Medicare patients. "Some counties in Washington have no doctors who take new Medicare patients," Dr. Douglas Paauw, a professor of medicine at the University of Washington, said.

Doctors in South Florida do not have a choice. Private insurers there pay the same as Medicare or less, and so many old people live in the area that if doctors want to practice, they must accept them. But how to make a living?

One way, Dr. Robert Colton, an internist in Boca Raton, said, is to see lots of patients, spending just a few minutes with each and referring complicated problems to specialists.

Dr. Colton did that for a while, seeing as many as 35 patients a day. A typical busy internist, he said, would see 20 patients a day. "I felt like a glorified triage nurse," he said.

"If you try to handle a complex problem, it slows you down," Dr. Colton said. "You have to sit down with the family, meet with the patients, talk to them. If you say you have coughing and you are short of breath and your knee hurts, I might have sent you to two different specialists."

The goal, Dr. Rosenkrantz said, is to move the patients on. "The worst thing that can happen is for someone to walk into your office and say, `I have an interesting case for you.' Financially, you'd be dead."

Even seeing patients in the hospital can become an exercise in time management, Dr. Rosenkrantz said. "We have doctors who do rounds at 4 a.m."

A second driving force behind medical care in Boca Raton is the demands of patients. They want lots of tests and specialists, they refer themselves to specialists, they ask for and get far more medical attention from specialists than many doctors think is reasonable or advisable.

"This Medicare card is like a gold card that lets you go to any doctor you want," Dr. Colton said. "I see it every day. When there's no control on utilization, it's just the path of least resistance. If a patient says, `My shoulder hurts, I want an M.R.I., I want to see a shoulder specialist,' the path of least resistance is to send them off. You have nothing to gain by refusing."

Patients here say they have mixed emotions. They complain about rushed primary care doctors but readily admit that they seek multiple specialists and multiple procedures.

The primary care doctors are often irritatingly busy, patients say. "In waiting rooms sometimes they are standing against the wall," said Marvin Luxenberg, a retired lawyer who lives in nearby Boynton Beach. Then, he said, "when you get in to see the doctor, you get just three or four minutes of time."

Dr. Colton says he found a way to give his patients more time. He joined a "concierge" practice, in which patients pay an annual fee in addition to the normal charges for medical services. Dr. Colton's group, MDVIP, charges patients $1,500 a year and limits the number of patients each doctor sees.

But not everyone wants to pay that kind of fee. Many patients just spend their time in specialists' offices. Each specialist handles a different aspect of their care, with no one coordinating it.

Specialists get no more than primary care doctors for an office visit, but they provide tests and procedures that demand higher Medicare reimbursements. Doctors say those payments allow them to stay in business, especially if they provide the procedures in their own office.

Medicare pays the doctor and the facility where a procedure is done. For a nuclear stress test, for example, the doctor gets about $200 and the facility gets about $1,200.

"Doctors have incorporated these tests as much as possible into their offices so they can gain from the facility fee," Dr. Thomas Bartzokis, an interventional cardiologist in Boca Raton, said.

Patients say they have lots of specialists, and lots of tests. Asked how many doctors he saw, Leon Bloomberg, 83, a patient of Dr. Miller, thought for a minute and looked at his wife, Esther.

"Between us, we have 10 or 12," Mr. Bloomberg said, including a pain specialist and a neurologist for his neuropathy, a cardiologist for his heart condition, "a pulmonary man" for his asthma, a rheumatologist for his arthritis and Dr. Miller for his prostate. Mrs. Bloomberg has her own doctors, including ones for heart disease and for diabetes. "We have two to four or more doctors' appointments a week," Mr. Bloomberg said.

It is easy to find all these specialists, he said. "You get recommendations at the clubhouse, at the swimming pool. You go to a restaurant here and 9 times out of 10, before the meal is over, you hear people talking about a doctor or a medicine or a surgery." And of course there are the other patients in all those waiting rooms. Mr. Bloomberg even recommends specialists to his own doctors.

But some patients say they are frustrated by what they call a waste of resources. "The doctors are raping Medicare," said Louis Ziegler, a retired manufacturer of flight simulators who lives in Delray Beach.

Mr. Ziegler recalled going to a doctor for a chronic problem, a finger that sometimes freezes. All he wanted was a shot of cortisone. But he got more, much more: "I had diathermy. I had ultrasound. I had a paraffin massage. I had $600 worth of Medicare treatments to get my lousy $35 shot of cortisone."

Dr. Colton, the internist here, is frustrated, too.

"The system is broken," he said. "I'm not being a mean ogre, but when you give something away for free, there is nothing to keep utilization down. And as the doctor, you have nothing to gain by denying them what they want."

Copyright 2003 The New York Times Company

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1 Comments:

At 4/19/2005 08:49:00 AM, Blogger Dawn said...

I work in the Medicaid field and know a little bit about Medicare, though I am far from an expert. I want to point out the Medicare patients don't recieve all their medical services for free. They pay 20% of all expenses. 20% is a lot when you are talking about specialists and MRIs and other tests. They pay much much more out of pocket on medications. They also pay a monthly premium that comes out of their social security check. This premium increases every year.
A few very very low income medicare patients in my state (each state has different Medicaid criteria as it is a state program) can recieve Medicaid also which may pay their premium for them or in extreme cases the 20% not covered by Medicare, but only if they can find a doctor that will take Medicaid. These doctors are hard to find. Medicaid pays nothing on medication for them unless they also recieve SSI which means their gross income is less than (I believe) $540/m. Hardly a windfall.
Also you don't qualify for Medicare simply by reaching a certain age. You have to have paid into the Medicare system, just like you have to pay into social security to get that. In my state many retiring state employees will not qualify for Medicare because they started working for the state before they had the option of having Medicare withheld from their paychecks.
Much of the problem with the excess expense is doctors insisting the elderly patients have lots of unnecessary tests and procedures. Often the patients go along because they see the doc as authority. This is especially a problem with lower income and less well educated people. My own MIL will refuse a test unless the doctor can demonstrate to her that a possitive outcome can be made. For example, is the treatment the same whether or not you have the MRI? Then why do the MRI when she is 79 years old? It's expensive and painful on elderly bones and ultimate offers no benefit. But my clients will believe their very life depends on various tests they don't understand because the doctor tells them they HAVE to have them.
It seems like an insurmountable problem, but if the lawmakers had to rely on Medicare and Social Security when they retire perhaps the system would be fixed. State and Federal legislators and senators have their own very generous system (and totally paid for from our taxes) completely apart from the citizenry and have very little understanding of the needs of regular people. That's why the idea of socializing medicine won't work. They put out scary stories of long waits (who doesn't have long waits now) and being told which doctors you can see (which is exactly what HMOs and PPOs do now. Sure you can see anyone, but they won't pay anyone.)
I know someone in Canada who says these horror stories are not true. In fact, she couldn't believe that we spend two or more hours waiting in our doctor's offices. The reason for the scare tactics is so the people we elect and pay to do the job can avoid facing the problem and having to come up with a solution. One very effective way they do this is to insinuate through their chistian connections that socializing medicine is akin to evil. Which in my opinion is the opposite of the truth. As a non-Christian, I believe it's our moral human obligation to make medical treatment (especially preventive care) available to everyone who needs it.
Thanks for the chance to offer my opinion.
Dawn

 

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