So why am I not surprised. In an op ed in the Times on Saturday, Tyler Cowen writes a piece entitled "Something’s Got to Give in Medicare Spending". This title states his conclusion based on what at best can be said are a confused set of facts. Cowen is a faculty member in economics at George Mason University, one of the Virginia state schools in Arlington, VA.
First, as we have stated and we have shown on multiple and repeated occasions, Medicare is a program that supports those who have contributed in excess of what they ever hope to get returned and many more who have contributed nothing.
Now Cowen states:
"It’s not the profits of the drug companies or the overhead of the insurance companies that make American health care so expensive, but the financial incentives for doctors and medical institutions to recommend more procedures, whether or not they are effective. So far, the American people have been unwilling to say no."
Frankly that may be part correct but it is not the provider alone who it fault. Providers perform tests to avoid legal problems. As has been noted, a 70 year old with back pain may have metastasized prostate cancer, breast cancer, multiple myeloma, and a plethora of other problems. This the tests to determine what the problem is. The patient may not sue but oftentimes the family will. Thus to reduce the risk procedures are performed. How are you to control that. Multiple myeloma can be diagnosed by a series of blood tests seeking specific markers, PSA may help with prostate cancers but the CCE may not permit that if the patient if over say 70!
Cowen then continues:
"Drawing upon the ideas of the Harvard economist David Cutler, the Obama administration talks of empowering an independent board of experts to judge the comparative effectiveness of health care expenditures; the goal is to limit or withdraw Medicare support for ineffective ones. This idea is long overdue, and the critics who contend that it amounts to “rationing” or “the government telling you which medical treatments you can have” are missing the point. The motivating idea is the old conservative chestnut that not every private-sector expenditure deserves a government subsidy."
Cutler is a health care mini-czar to the current President. Yes he was at Harvard but he has moved on, thus one should be honest at least with that biased disclosure. CCE has its problems as articulated herein many times. It as proposed is a Government and not a professional assessment group and as such it lags trends, delimits options and in the end will ration. Only those not on Medicare such as all Government employees will be free of the rationing. Is there no wonder that there are no objections from Congress, they are not affected. Cowen is missing the point and paying no attention to facts. Just look at how long a new drug takes to get through the FDA. Now compound that many fold and we have CCE procedure approvals. If the Government has its way the unapproved Medicare CCE procedures may be banned totally. Why don't we just burn the medical books, JAMA and NEJM to start!
Cowen then goes on to use the Dartmouth study:
"Scholars have been applying comparative-effectiveness research to Medicare for years, and the verdict is not altogether pretty. It turns out that some regions spend more on Medicare than others — sometimes two or three times as much, as documented by the Dartmouth Atlas Project. Yet the higher-spending regions often fail to produce superior health care results."
The problem here is in the details. Take a colonoscopy for example. If one does a colonoscopy in Florida the overhead costs are low and the patients may be somewhat homogeneous. Then take one done at Columbia Presbyterian in New York at 168th Street. In New York there are say 200 performed per day in a clinic setting which is akin to some industrial type surgery wards I have seen in Russia. People side by side and English not the main language. The staff performs one per 40 minutes and it is a true assembly line. But the costs are higher despite the attempts to be more productive than any other location. Why? Good question. Dartmouth damns New York without asking why. Truth is found by answering the whys and not just mouthing the whats. One should remember that Dartmouth is in Hanover and it does not in any way present the real world. Columbia Presbyterian and other New York Hospitals are a cross section of humanity. Thus the Dartmouth group should really find the whys before they justify themselves on the whats!
Cowen then goes on:
"Suggested ways to lower costs include an emphasis on preventive care, the use of electronic medical records and increased competition among insurers. But even if these are likely to improve the quality of care, they are speculative and uncertain as cost-saving measures. Keep in mind that while computers were remarkably powerful inventions, it took decades before they showed up in the statistics as having improved productivity in the workplace."
Frankly I have no idea where he is going here. It is a bit of on the one hand and then on the other. Yes we all agree the the EMR will help, assuming it exists, it works, and it is used. We have addressed that issue in detail before.
Cowen continues:
"One idea embodied in a bill sponsored by Senator Ron Wyden, Democrat of Oregon, and Senator Robert F. Bennett, Republican of Utah, is to finance new health care programs by taxing health insurance benefits. This makes sense in principle: why should insurance benefits be favored over salary by our tax system? But employer-supplied insurance is a mainstay of the current health care system, and there is no adequate replacement immediately in sight.....It sounds harsh to suggest that the Obama administration cut areas of Medicare spending, but, too often, increased expenditures and coverage are confused with good health care outcomes. The reality is that our daily environment, our social status and our behavior — including diet and exercise — have more to do with good health than does health care more narrowly defined....The demand for universal coverage sounds like a moral imperative to “take care of everybody,” but in reality it would make only a marginal difference when it comes to the overall health of the American population. The sober reality is that universal coverage is another way to spend money, which may or may not be a good idea."
There are many ideas here with little justification. Let me address them in a more logical order:
1. Universal Coverage: Like auto insurance there are externalities. We have to take care of a sick person whether they have insurance or not. Opting out means moving the cost to everyone who is in. The issue is coverage for what? Catastrophic, accident, chronic, acute. That is the debate.
2. Taxing Benefits: This is a question if and only is we assume that employer benefits remain rather than having a system where every person is insured in a manner akin to auto insurance. I recognize that such an approach is antithetical to the way we think but perhaps new thinking is necessary. Multiple providers, and individuals. Perhaps also the patient should pay the physician or provider and the patient should then get reimbursed by the insurer. Again like auto insurance in many cases. The nexus between the patient and the provider in terms of the payment is a critical connection to let both understand costs.
3. Medicare has some problems but they are too often Government based problems. The Medicare reimbursement system if used in global financial trading systems would collapse the world economy in just a few days. It is incompetently organized and operated. No business would have a billing and payment system like this. I remember my days developing and managing the cellular billing system twenty years ago. They were complex and if we had a problem we were soon aware if it and it was fixed. What takes Medicare so long, well it is the Government!
4. Back to Universal: If Universal is to work then all must be in the system, and if one looks at Medicare then that means Unions and Government workers and all politicians. They must have a dog in the hunt!
First, as we have stated and we have shown on multiple and repeated occasions, Medicare is a program that supports those who have contributed in excess of what they ever hope to get returned and many more who have contributed nothing.
Now Cowen states:
"It’s not the profits of the drug companies or the overhead of the insurance companies that make American health care so expensive, but the financial incentives for doctors and medical institutions to recommend more procedures, whether or not they are effective. So far, the American people have been unwilling to say no."
Frankly that may be part correct but it is not the provider alone who it fault. Providers perform tests to avoid legal problems. As has been noted, a 70 year old with back pain may have metastasized prostate cancer, breast cancer, multiple myeloma, and a plethora of other problems. This the tests to determine what the problem is. The patient may not sue but oftentimes the family will. Thus to reduce the risk procedures are performed. How are you to control that. Multiple myeloma can be diagnosed by a series of blood tests seeking specific markers, PSA may help with prostate cancers but the CCE may not permit that if the patient if over say 70!
Cowen then continues:
"Drawing upon the ideas of the Harvard economist David Cutler, the Obama administration talks of empowering an independent board of experts to judge the comparative effectiveness of health care expenditures; the goal is to limit or withdraw Medicare support for ineffective ones. This idea is long overdue, and the critics who contend that it amounts to “rationing” or “the government telling you which medical treatments you can have” are missing the point. The motivating idea is the old conservative chestnut that not every private-sector expenditure deserves a government subsidy."
Cutler is a health care mini-czar to the current President. Yes he was at Harvard but he has moved on, thus one should be honest at least with that biased disclosure. CCE has its problems as articulated herein many times. It as proposed is a Government and not a professional assessment group and as such it lags trends, delimits options and in the end will ration. Only those not on Medicare such as all Government employees will be free of the rationing. Is there no wonder that there are no objections from Congress, they are not affected. Cowen is missing the point and paying no attention to facts. Just look at how long a new drug takes to get through the FDA. Now compound that many fold and we have CCE procedure approvals. If the Government has its way the unapproved Medicare CCE procedures may be banned totally. Why don't we just burn the medical books, JAMA and NEJM to start!
Cowen then goes on to use the Dartmouth study:
"Scholars have been applying comparative-effectiveness research to Medicare for years, and the verdict is not altogether pretty. It turns out that some regions spend more on Medicare than others — sometimes two or three times as much, as documented by the Dartmouth Atlas Project. Yet the higher-spending regions often fail to produce superior health care results."
The problem here is in the details. Take a colonoscopy for example. If one does a colonoscopy in Florida the overhead costs are low and the patients may be somewhat homogeneous. Then take one done at Columbia Presbyterian in New York at 168th Street. In New York there are say 200 performed per day in a clinic setting which is akin to some industrial type surgery wards I have seen in Russia. People side by side and English not the main language. The staff performs one per 40 minutes and it is a true assembly line. But the costs are higher despite the attempts to be more productive than any other location. Why? Good question. Dartmouth damns New York without asking why. Truth is found by answering the whys and not just mouthing the whats. One should remember that Dartmouth is in Hanover and it does not in any way present the real world. Columbia Presbyterian and other New York Hospitals are a cross section of humanity. Thus the Dartmouth group should really find the whys before they justify themselves on the whats!
Cowen then goes on:
"Suggested ways to lower costs include an emphasis on preventive care, the use of electronic medical records and increased competition among insurers. But even if these are likely to improve the quality of care, they are speculative and uncertain as cost-saving measures. Keep in mind that while computers were remarkably powerful inventions, it took decades before they showed up in the statistics as having improved productivity in the workplace."
Frankly I have no idea where he is going here. It is a bit of on the one hand and then on the other. Yes we all agree the the EMR will help, assuming it exists, it works, and it is used. We have addressed that issue in detail before.
Cowen continues:
"One idea embodied in a bill sponsored by Senator Ron Wyden, Democrat of Oregon, and Senator Robert F. Bennett, Republican of Utah, is to finance new health care programs by taxing health insurance benefits. This makes sense in principle: why should insurance benefits be favored over salary by our tax system? But employer-supplied insurance is a mainstay of the current health care system, and there is no adequate replacement immediately in sight.....It sounds harsh to suggest that the Obama administration cut areas of Medicare spending, but, too often, increased expenditures and coverage are confused with good health care outcomes. The reality is that our daily environment, our social status and our behavior — including diet and exercise — have more to do with good health than does health care more narrowly defined....The demand for universal coverage sounds like a moral imperative to “take care of everybody,” but in reality it would make only a marginal difference when it comes to the overall health of the American population. The sober reality is that universal coverage is another way to spend money, which may or may not be a good idea."
There are many ideas here with little justification. Let me address them in a more logical order:
1. Universal Coverage: Like auto insurance there are externalities. We have to take care of a sick person whether they have insurance or not. Opting out means moving the cost to everyone who is in. The issue is coverage for what? Catastrophic, accident, chronic, acute. That is the debate.
2. Taxing Benefits: This is a question if and only is we assume that employer benefits remain rather than having a system where every person is insured in a manner akin to auto insurance. I recognize that such an approach is antithetical to the way we think but perhaps new thinking is necessary. Multiple providers, and individuals. Perhaps also the patient should pay the physician or provider and the patient should then get reimbursed by the insurer. Again like auto insurance in many cases. The nexus between the patient and the provider in terms of the payment is a critical connection to let both understand costs.
3. Medicare has some problems but they are too often Government based problems. The Medicare reimbursement system if used in global financial trading systems would collapse the world economy in just a few days. It is incompetently organized and operated. No business would have a billing and payment system like this. I remember my days developing and managing the cellular billing system twenty years ago. They were complex and if we had a problem we were soon aware if it and it was fixed. What takes Medicare so long, well it is the Government!
4. Back to Universal: If Universal is to work then all must be in the system, and if one looks at Medicare then that means Unions and Government workers and all politicians. They must have a dog in the hunt!
Posts
