Author Archive

Perfect Information?

The Huffington Post recently featured a story by Dr. Ricardo Azziz, “The Myth of the Rational Health Care Consumer.”

He disagrees with Uwe Reinhardt’s contention that health care is a “private good.” Azziz writes –

Economists generally categorize goods into two types — public and private. Public goods are defined as “nonrival,” meaning a person can use it without reducing its use by others, and “non-excludable,” meaning individuals cannot be excluded from using the good. Reinhardt gives the example of street lighting.

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Medicare Goes Concierge – Sorta

Medicine Bag and StethoscopeOne of the great things about concierge medicine (also called direct practice) is the ability to contact your doctor at any time. Also, that your doctor will work with other caregivers and advocate on your behalf.

Yes, it costs you extra for the extra service, but that is how the doctors can reduce their case loads and free up the time to provide you with additional attention. Not everybody thinks the additional fee is worth it, but many do. Plus an argument can be made that the customized care saves money by reducing duplicative tests and hospitalization.

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The False Promise of Bundled Payments

We have written a lot here about the false promise of “bundled payments.” See here and here.

Now come two advocates of bundling who are having second thoughts. They are James Caillouette, Surgeon-in-Chief at the Hoag Orthopedic Institute, and James Robinson, economics professor at UC Berkley, who write in Health Affairs that –

As leaders in the Integrated Health Association (IHA) bundled payment initiative, we shared the same hopes, devoted the same energies, and share the same frustrations with the modest results. We feel it is important to emphasize what we consider to be the initiative’s most important design failure: the lack of engagement and alignment on the part of the consumer. No one will ever reform the U.S. health care system without bringing the consumer along and, indeed, placing consumer choice and accountability at the very center of the reform initiative.

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How We Once Provided Medical Benefits

Our country suffers from amnesia about how we used to solve problems in the not-so-distant past. It is something I hope to help correct in a new paper published by the Citizens’ Council for Health Freedom, “Safe Haven: How Mutual Aid Can Protect Families in Times of Trouble.”

This paper shows how fraternal associations once provided the vast bulk of medical benefits and life insurance in the United States and Britain. These associations were formed by working class men and women from all ethnic groups. In some cases they owned and operated their own hospitals. They also provided schools and orphanages for the children of deceased members, sickness funds for members who were unable to work, relocation assistance to help workers go where the jobs were, and moral support to families in times of trouble.

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The Patient Care Quarterback

The New England Journal of Medicine recently published an article by Matthew J. Press, MD, about the need for patients to have a quarterback to coordinate the team of care-givers. Dr. Press writes –

Care coordination is now a high priority in health care and is the backbone of new models of care, such as accountable care organizations, that aim to improve quality and reduce costs. But it remains an abstract concept to many people who are not on the front lines of clinical care, as well as to some on the front lines who lack (or don’t want to have) the quarterback’s view of the field. In replaying the highlights, we can learn some important lessons about care coordination.

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Consumer-Driven Health Care Round Up

Lots going on in the Consumer-Driven space these days.

AHIP released its latest version of the annual HSA enrollment census. The results are impressive, though still understated since they only received responses from 71% of the companies. It finds enrollment growth of about 15% every year, now reaching 17.4 million. Perhaps the most interesting aspect is the state-by-state breakdown of market penetration. The old Red State/Blue State divide does not hold up when it comes to market behavior. Some of the states with low enrollment include Mississippi, Alabama, and South Carolina, while some of the highest enrollments are found in Minnesota, Illinois, and Maine.

AHIP also released, along with the American Bankers’ Association, a report on HSA account activity. One notable tidbit from this report is the size of the contributions, both personal and from employers. The average personal contribution in 2012 was $2,337, and the average employer contribution was $1,142. Also interesting is that only 19% of all the accounts had $0 balances at the end of the year, indicating that most people are retaining funds in their accounts at least for future use, if not for long-term savings.

Dr. Ben Carson has become a passionate advocate for HSAs, seeing them as a viable alternative to much of Obamacare. An op-ed he wrote has been widely circulated.

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Thanks, Suckers

HHS is crowing about how much money has been returned to consumers due to the Medical Loss Ratio (MLR) rules.

The Hill reports –

Insurance companies returned about $ 9 billion dollars from premiums since 2011 because of an Obamacare provision to cap how much profit they can make, according to a new Department of Health and Human Services (HHS) report released Thursday.

Actually the MLR thingy was always a con. First, this regulation had never been tried anywhere. A couple of states tried it with lower ratios but without success. There was absolutely no evidence it was either a good idea or would work without big unintended consequences.

One of those consequences is obvious. Insurers are free to overcharge people, collect the money, earn interest on it during the course of a year, and rebate the overcharge 18 months later. So consumers in effect are simply giving the insurers an interest free loan for a year. That is why there has been $9 billion in rebates. This is not a good thing. Consumers unwillingly loaned insurers $9 billion for a year and got nothing in return.

Three Conservative Ideas Buried within Obamacare

Caduceus with First-aid KitThe Affordable Care Act is the worst piece of legislation ever passed into law in the United States. However, it does open up some doors that were firmly locked before — things that most free-market economists have been espousing for years without success. We should not run away from those things just because they have President Obama’s name on it.

I am not talking about the things the idiot media think are popular — the slacker mandate, open enrollment, equal premiums for men and women, and free “preventative” services.

However, I see three conservative ideas buried in Obamacare. Read about all three in my column in The Federalist.

The Verdict Is In?

Politico‘s headline was unambiguous ― “The verdict is in: Obamacare lowers uninsured.”

Well, my goodness, I would certainly hope so after spending several hundred billions of dollars to do just that. We can’t be sure how much has been spent so far, but the legislation called for over $1,000 billion over ten years. Let’s see ― it has been in effect for four years now, so is that $400 billion so far?

The Politico article reports that the Commonwealth Fund estimates 9.5 million fewer uninsured, and the Urban Institute finds 8 million newly insured adults. Let’s round it up to ten million. That would make $40,000 for each newly insured person. Wow!

Of course, there are some problems with even these optimistic numbers. Chris Conover delves deeply into the methodology in Forbes. But I want to add a few other observations –

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There is no Patient Privacy

Dr. Deborah Peel is probably the nation’s foremost advocate for patient privacy. The Texas psychiatrist has worked tirelessly to include privacy protections in all of the health reform ideas of the past twenty years.

She recently gave a presentation at TEDx where she informed the geek community of how extensive medical data breaches have become. Not just extensive but perfectly legal and even encouraged by our government. Bottom line ― there is no medical privacy anywhere in American health care.


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