Healthcare Summary

This Table is from the New England Journal of Medicine and is a great summary of the Stimulus plan for Healthcare. It shows an expenditure for HIT in excess $19 billion which exceeds my previous number from HR1 and its Section 3000 by $12 billion. I must go back and figure out where the remainder is hidden. It grants physicians up to $65,000 for implementation which is what I may have missed the first time through.

The total is $136 billion! Of that $87 billion goes to states for Medicaid programs. Additional $25 billion goes to assist in unemployment health coverage and the comparative effectiveness is a total of $1.1 billion.

One needs to become a biblical scholar reading the document again and again and reinterpreting it. Almost 17.5% of the Stimulus is for Healthcare and most of that is directly for payments to states and subsidies for COBRA payments.

Response to Signing the Stimulus

This is our December 1, 2008 portfolio of classic American stocks. The declines each time the Administration takes another action is remarkable. The forward looking loss in American core business for 2009 is now in excess of 50% for this year. We may be looking at a DJIA hitting 4000 by year end if this is sustained. That means we may likely see in excess of 10.5% unemployment as well, possibly 15%. Confidence is ebbing away rapidly. The announcement of the mortgage bailout on Wednesday may likely add more bad news. Despite the erosion of the contract clause of the Constitution and the fact that mortgage holders can unilaterally have their contracts rewritten by a court, this bodes poorly for any future growth. The markets require some form of certainty. If a court can rewrite a financial agreement then the pricing of that agreement has no value. This means that this uncertainty will be factored into future agreements and thus make them less available and more costly. Beware the unintended consequences!

Health Information Technology: Every Part of HR1 Creates Another Permanent Government Agency!

The HR1 section on Health Information Technology is the third element of HR1 we have analyzed. There is a clear pattern.

I: Health Information Technology, SEC 3000 et al creates a $3 billion Government Czar and infrastructure to develop an Electronic Health Record as defined:

"(13) QUALIFIED ELECTRONIC HEALTH RECORD.—The term qualified electronic health record means an electronic record of health‐related information on an individual that— (A) includes patient demographic and clinical health information, such as medical history and problem lists; and (B) has the capacity— (i) to provide clinical decision support; (ii) to support physician order entry; (iii) to capture and query information relevant to health care quality; and (iv) to exchange electronic health information with, and integrate such information from other sources."

II: Broadband; SEC 201 Creates an NTIA Broadband Czar for $7 billion. It also mandates but does not fund 50 State plus territories Broadband Czars which will add to the real estate tax payers load.

III: Clinical Effectiveness SEC 802 creates a Clinical Effectiveness Czar and a massive organization. This is $700,000,000 for comparative clinical effectiveness research.

Each of these has a Czar, an organization, initial funding, and what appears to be a perpetual life. It is clear that HR1 is one of the greatest generators of Government bureaucracy ever known. Broadband is wasteful, clinical effectiveness is a natural part of the practice of medicine, as is evidence based medicine, and the medical record issue is best done in the private sector, as was the Internet with the IETF.

Now let us briefly look at the definition of the Electronic Health Record as in the Bill and as stated above. It is vague and it grossly fails to provide what we hare argued before is required. It must be patient focused, capable of handling complex multimedia elements, displayable and annotateable, and capable of be cross indexed and analyzable across and wide patient base and across a wide set of highly complex variables. If it has any use other than a data collection it must be able to be used for clinical trials. That should be a minimal benchmark.

The EHR section mandates "(iii) The utilization of a certified electronic health record for each person in the United States by 2014" Frankly is was easier to build an atomic bomb than to implement this nationally in five years. It is not the execution but defining what the answer is. The FAA has failed to upgrade the ATC systems for forty years and we all know what has to be done and there is a central point of control! How is this to be mandated from some Government Czar when the answer is unknown and the Government has an abysmal track record!

I would suspect that as one goes section by section through this massive bill that the theme of more, bigger, costly Government spending will be seen and that further the infrastructure built is both permanent and expansive. The shame is that no one was allowed to comment on these expenditures.

HR 1 Broadband: I have the Distinct Disadvantage of Experience!

Broadband, yes this was a deployment in Kutztown, PA which I photographed in 2003. We then did 35 detailed market, engineering and business plans for markets in New Hampshire, Massachusetts and Vermont, we even got RUS funding, even built out a portion on our own, and then hit the brick wall of the greedy towns and their Franchises. This is the snake in the woodpile that this Bill somehow glosses over. Also the small fact that there may not be a business model which works.

Thus it is worthwhile providing the HR1 words on broadband, and then look at facts. Somehow all the cheerleaders for broadband have never: (1) ever built anything, (2) have even had to create a business to pay salaries, (3) have any idea as to the technology, (4) ever negotiated a franchise. Regrettably I have, and I have done this in over 20 countries, the hardest is the US! Politics, the worst kind, local politics.

Now to the Bill. First the preamble:

"NATIONAL TELECOMMUNICATIONS AND INFORMATION ADMINISTRATION BROADBAND TECHNOLOGY OPPORTUNITIES PROGRAM

For an amount for ‘‘Broadband Technology Opportunities Program’’, $7,000,000,000, to remain available until September 30, 2010: Provided, That of the funds provided under this heading, $6,650,000,000 shall be expended pursuant to section 201 of this Act, of which: not less than $200,000,000 shall be available for competitive grants for expanding public computer center capacity, including at community colleges and public libraries; not less than $250,000,000 shall be available for competitive grants for innovative programs to encourage sustainable adoption of broadband service; and $10,000,000 shall be transferred to ‘‘Department of Commerce, Office of Inspector General’’ for the purposes of audits and oversight of funds provided under this heading and such funds shall remain available until expended:

Provided further, That 50 percent of the funds provided in the previous proviso shall be used to sup2 port projects in rural communities, which in part may be transferred to the Department of Agriculture for administration through the Rural Utilities Service if deemed necessary and appropriate by the Secretary of Commerce, in consultation with the Secretary of Agriculture, and only if the Committees on Appropriations of the House and the Senate are notified not less than 15 days in advance of the transfer of such funds:

Provided further, That of the funds provided under this heading, up to $350,000,000 may be expended pursuant to Public Law 110–385 (47 U.S.C. 1 note) and for the purposes of developing and maintaining a broadband inventory map pursuant to section 201 of this Act:

Provided further, That of the funds provided under this heading, amounts deemed necessary and appropriate by the Secretary of Commerce, in consultation with the Federal Communications Commission (FCC), may be transferred to the FCC for the purposes of developing a national broadband plan or for carrying out any other FCC responsibilities pursuant to section 201 of this Act, and only if the Committees on Appropriations of the House and the Senate are notified not less than 15 days in advance of the transfer of such funds: Provided further, That not more than 3 percent of funds provided under this heading may be used for administrative costs, and this limitation shall apply to funds which may be transferred to the Department of Agriculture and the FCC."

Yes indeed that is $7 billion for these many yet to be specified tasks! Now to Section 201!

SEC. 201.

The Assistant Secretary of Commerce for Communications and Information (Assistant Secretary), in consultation with the Federal Communications Commission (Commission) (and, with respect to rural areas, the Secretary of Agriculture), shall establish a national broadband service development and expansion program in conjunction with the technology opportunities program, which shall be referred to the Broadband Technology Opportunities Program. The Assistant Secretary shall ensure that the program complements and enhances and does not conflict with other Federal broadband initiatives and programs.

(1) The purposes of the program are to—
(A) provide access to broadband service to citizens residing in unserved areas of the United States;
(B) provide improved access to broadband service to citizens residing in underserved areas of the United States;
(C) provide broadband education, awareness, training, access, equipment, and support to— (i) schools, libraries, medical and healthcare providers, community colleges and other institutions of higher education, and other community support organizations and entities to facilitate greater use of broadband service by or through these organizations; (ii) organizations and agencies that provide outreach, access, equipment, and support services to facilitate greater use of broadband service by low-income, unemployed, aged, and otherwise vulnerable populations; and (iii) job-creating strategic facilities located within a State-designated economic zone, Economic Development District designated by the Department of Commerce, Renewal Community or Empowerment Zone designated by the Department of Housing and Urban Development, or Enterprise Community designated by the Department of Agriculture.
(D) improve access to, and use of, broadband service by public safety agencies; and
(E) stimulate the demand for broadband, economic growth, and job creation.

(2) The Assistant Secretary may consult with the chief executive officer of any State with respect to—
(A) the identification of areas described in subsection (1)(A) or (B) located in that State; and
(B) the allocation of grant funds within that State for projects in or affecting the State.

(3) The Assistant Secretary shall—
(A) establish and implement the grant program as expeditiously as practicable;
(B) ensure that all awards are made before the end of fiscal year 2010;
(C) seek such assurances as may be necessary or appropriate from grantees under the program that they will substantially complete projects supported by the program in accordance with project timelines, not to exceed 2 years following an award; and
(D) report on the status of the program to the Committees on Appropriations of the House and the Senate, the Committee on Energy and Commerce of the House, and the Committee on Commerce, Science, and Transportation of the Senate, every 90 days.

(4) To be eligible for a grant under the program an applicant shall—
(A) be a State or political subdivision thereof, a nonprofit foundation, corporation, institution or association, Indian tribe, Native Hawaiian organization, or other non-governmental entity in partnership with a State or political subdivision thereof, Indian tribe, or Native Hawaiian organization if the Assistant Secretary deter mines the partnership consistent with the purposes this section;
(B) submit an application, at such time, in such form, and containing such information as the Assistant Secretary may require;
(C) provide a detailed explanation of how any amount received under the program will be used to carry out the purposes of this section in an efficient and expeditious manner, including a demonstration that the project would not have been implemented during the grant period without Federal grant assistance;
(D) demonstrate, to the satisfaction of the Assistant Secretary, that it is capable of carrying out the project or function to which the application relates in a competent manner in compliance with all applicable Federal, State, and local laws;
(E) demonstrate, to the satisfaction of the Assistant Secretary, that it will appropriate (if the applicant is a State or local government agency) or otherwise unconditionally obligate, from non-Federal sources, funds required to meet the requirements of paragraph (5);
(F) disclose to the Assistant Secretary the source and amount of other Federal or State funding sources from which the applicant receives, or has applied for, funding for activities or projects to which the application relates; and
(G) provide such assurances and procedures as the Assistant Secretary may require to ensure that grant funds are used and accounted for in an appropriate manner.

(5) The Federal share of any project may not exceed 80 percent, except that the Assistant Secretary may increase the Federal share of a project above 80 percent if—
(A) the applicant petitions the Assistant Secretary for a waiver; and
(B) the Assistant Secretary determines that the petition demonstrates financial need.

(6) The Assistant Secretary may make competitive grants under the program to—
(A) acquire equipment, instrumentation, networking capability, hardware and software, digital network technology, and infrastructure for broadband services;
(B) construct and deploy broadband service related infrastructure;
(C) ensure access to broadband service by community anchor institutions;
(D) facilitate access to broadband service by low-income, unemployed, aged, and otherwise vulnerable populations in order to provide educational and employment opportunities to members of such populations;
(E) construct and deploy broadband facilities that improve public safety broadband communications services; and
(F) undertake such other projects and activities as the Assistant Secretary finds to be consistent with the purposes for which the program is established.

(7) The Assistant Secretary—
(A) shall require any entity receiving a grant pursuant to this section to report quarterly, in a format specified by the Assistant Secretary, on such entity’s use of the assistance and progress fulfilling the objectives for which such funds were granted, and the Assistant Secretary shall make these reports available to the public;
(B) may establish additional reporting and information requirements for any recipient of any assistance made available pursuant to this section;
(C) shall establish appropriate mechanisms to ensure appropriate use and compliance with all terms of any use of funds made available pursuant to this section;
(D) may, in addition to other authority under applicable law, deobligate awards to grantees that demonstrate an insufficient level of performance, or wasteful or fraudulent spending, as defined in advance by the Assistant Secretary, and award these funds competitively to new or existing applicants consistent with this section; and
(E) shall create and maintain a fully searchable database, accessible on the Internet at no cost to the public, that contains at least the name of each entity receiving funds made avail1 able pursuant to this section, the purpose for which such entity is receiving such funds, each quarterly report submitted by the entity pursuant to this section, and such other information sufficient to allow the public to understand and monitor grants awarded under the program.

(8) Concurrent with the issuance of the Request for Proposal for grant applications pursuant to this section, the Assistant Secretary shall, in coordination with the Federal Communications
Commission, publish the non-discrimination and network interconnection obligations that shall be contractual conditions of grants awarded under this section.

(9) Within 1 year after the date of enactment of this Act, the Commission shall complete a rulemaking to develop a national broadband plan. In developing the plan, the Commission shall—
(A) consider the most effective and efficient national strategy for ensuring that all Americans have access to, and take advantage of, advanced broadband services;
(B) have access to data provided to other Government agencies under the Broadband Data Improvement Act (47 U.S.C. 1301 note);
(C) evaluate the status of deployments of broadband service, including the progress of projects supported by the grants made pursuant to this section; and
(D) develop recommendations for achieving the goal of nationally available broadband service for the United States and for promoting broadband adoption nationwide.

(10) The Assistant Secretary shall develop and maintain a comprehensive nationwide inventory map of existing broadband service capability and avail ability in the United States that entities and depicts the geographic extent to which broadband service capability is deployed and available from a commercial provider or public provider throughout each State: Provided, That not later than 2 years after the date of the enactment of the Act, the Assistant Secretary shall make the broadband inventory map developed and maintained pursuant to this section accessible to the public."

That's all folks! Now it is worth looking at details.

There is a lot of money going to Hawaii! Why, one can only guess! Then it also requires that the projects be complete in 2 `years! Try and get a franchise in that time, then get equipment, then pull on the poles etc. No way can this be done! It is physically impossible, but I forgot this was Congress, reality plays no role. Also the NTIA has no infrastructure, policies, procedures and the like to accomplish this. That in itself will take years and if not done properly will result in massive fraud. USDA and its agency RUS has decades of experience and a group of competent and dedicated people. They are not being used.

This is doomed to failure. Say goodbye to $7 billion. This is not a stimulus it is a total and complete waste of the taxpayers money. Finally it is in the purview of the State to select the areas to be built out, in effect the States create market plans, and then somehow third parties submit bids for these parcels. States in charge of markets, again unlikely to work.

Looking at Section 802: The Camel's Nose in the Tent

The Section 802 of the Stimulus is worth a read because it may very well change the way Medicine is practiced in the United States. Here it is in detail:

"SEC. 802. FEDERAL COORDINATING COUNCIL FOR COMPARATIVE CLINICAL EFFECTIVENESS RESEARCH.

(a) ESTABLISHMENT.—There is hereby established a Federal Coordinating Council for Comparative Clinical Effectiveness Research (in this section referred to as the ‘‘Council’’).

(b) PURPOSE; DUTIES.—The Council shall—

(1) assist the offices and agencies of the Federal Government, including the Departments of Health and Human Services, Veterans Affairs, and Defense, and other Federal departments or agencies, to coordinate the conduct or support of comparative clinical effectiveness and related health services research; and

(2) advise the President and Congress on— (A) strategies with respect to the infrastructure needs of comparative clinical effectiveness research within the Federal Government; (B) appropriate organizational expenditures for comparative clinical effectiveness research by relevant Federal departments and agencies; and (C) opportunities to assure optimum coordination of comparative clinical effectiveness and related health services research conducted or supported by relevant Federal departments and agencies, with the goal of reducing duplicative efforts and encouraging coordinated and complementary use of resources.

(c) MEMBERSHIP.— (1) NUMBER AND APPOINTMENT.—The Council shall be composed of not more than 15 members, all of whom are senior Federal officers or employees with responsibility for health related programs, appointed by the President, acting through the Secretary of Health and Human Services (in this section referred to as the ‘‘Secretary’’). Members shall first be appointed to the Council not later than 30 days after the date of the enactment of this Act. (2) MEMBERS.— (A) IN GENERAL.—The members of the Council shall include one senior officer or employee from each of the following agencies: (i) The Agency for Healthcare Research and Quality. (ii) The Centers for Medicare and Medicaid Services. (iii) The National Institutes of Health. (iv) The Office of the National Coordinator for Health Information Technology. (v) The Food and Drug Administration. (vi) The Veterans Health Administration within the Department of Veterans Affairs. (vii) The office within the Department of Defense responsible for management of the Department of Defense Military Health Care System. (B) QUALIFICATIONS.—At least half of the members of the Council shall be physicians or other experts with clinical expertise. (3) CHAIRMAN; VICE CHAIRMAN.—The Secretary shall serve as Chairman of the Council and shall designate a member to serve as Vice Chairman.

(d) REPORTS.— (1) INITIAL REPORT.—Not later than June 30, 2009, the Council shall submit to the President and the Congress a report containing information describing Federal activities on comparative clinical effectiveness research and recommendations for additional investments in such research conducted or supported from funds made available for allotment by the Secretary for comparative clinical effectiveness research in this Act. (2) ANNUAL REPORT.—The Council shall submit to the President and Congress an annual report regarding its activities and recommendations concerning the infrastructure needs, appropriate organizational expenditures and opportunities for better co ordination of comparative clinical effectiveness research by relevant Federal departments and agencies.

(e) STAFFING; SUPPORT.—From funds made available for allotment by the Secretary for comparative clinical effectiveness research in this Act, the Secretary shall make available not more than 1 percent to the Council for staff and administrative support."

This creates two new Offices and expands one:

(1) The Agency for Healthcare Research and Quality.
(2) The Centers for Medicare and Medicaid Services.
(3) The Office of the National Coordinator for Health Information Technology.

These offices will create policies and procedures to select the most effective health care treatments to be mandated by the Federal Government. This is a very powerful creation and may very well change the way we see health care being delivered in the future. This is the first big step, it is the camel's nose in the tent.

Government Oversight of Medicine

There are provisions in the new Stimulus Bill to create a Government Oversight Board for ensuring that there is nationwide compliance with comparative clinical effectiveness, namely rating and ranking procedures, medications and the like for the treatment of various medical ailments.

Let us consider the colonoscopy. There already exists a "Centers for Medicare and Medicaid services" the "CMS" which has been performing that task for Medicare and Medicaid for years. Their most recent prognostication was that CT virtual colonoscopy had not met the level for acceptance so that it would not receive payment as an accepted procedure. This may very well be a valid conclusion. The reasons themselves may be varied and the procedure may still be performed unless the new Board as passed under this new Bill agrees with the CMS and then eliminates it.

But let us take another further look. A group of Canadian physicians performed a study that reached the conclusion as follows:

"Conclusion: In usual practice, colonoscopy is associated with fewer deaths from CRC. This association is primarily limited to deaths from cancer developing in the left side of the colon."

Namely they contend that based upon their study there is no benefit to screening for ascending colon lesions. The devil is in the details,however. First the Canadian system admits patients to colonoscopies at very late stages, it is truly a rationed system and in preventative medicing rationing means getting there too late.

Second, these are Canadian physicians in Canadian medicine which means that they permit less than fully qualified practioners to perform these tests which require true skill and care. Their results included the following Table demonstrate that almost anyone can perform this procedure which demands great experience. The procedures were performed by a mix of physicians, most, if not all, not certified as endoscopists.




As is well known, colonoscopies can nearly eliminate colon cancer if performed by a skilled endoscopist. Sessile lesions in the folds of the colon are generally the greatest threat. They get missed and they are the killer lesions. Thus the endoscopist must be skilled, must take care and time, and must be thorough. The result is that a procedure costing some $1,200-1,800 can save not only a life but hundreds of thousands in subsequent medical costs.

So how does the new Stimulus Bill, the existing CMS and the Canadian study all blend together? Simply, first we have a functioning Comparative Effectiveness system in place, it functions and already controls over 50% of healthcare. Thus Medicare and Medicaid will see no change, unless, and that is the big question, unless it is done for other purposes than patient care. However it is now possible that all other patients will see an impact, NO! will most likely become a common refrain.

Secondly, studies like the less than useful Canadian Study may become the hook to hang reduction of procedures on, especially as we see the new Board has a mix of Physicians and non-Physicians. Imagine Nancy Pelosi look-alikes on such a Board. There are even worse imaginantions!