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Volume 65, No. 6 June 2009
In 1993, at a meeting of the Arizona Medical Association, we
were told that the reform train was leaving the station, so we
had better get on board. Now, we're hearing the same refrain with
an added quotation from Dwight Eisenhower, in the Maricopa County
Medical Society (MCMS) journal Round-up, that we
shouldn't lie down on the track of history to wait for the train
of the future to run over us.
In 1993, a fan of Westerns observed that there were a lot of
ways to stop a train. The best way is to use the brakes. The
congressional brakes, however, have been disconnected. Major
changes may be rammed through in a budget reconciliation bill.
Doctors need to get off the train now. Before it
picks up more speed. Obama, incidentally, aspires to be the
president who brings us high-speed rail transportation.
The Destination
Obama's eight "guiding principles," for which the AMA
announced strong support in an Apr 13 letter, amount to the
following, writes David McKalip, M.D., of St. Petersburg, FL: 1)
Pay for performance or P4P ("value-based purchasing"); 2)
rationing ("efficiency"); 3) cookbook medicine ("quality"); 4)
wealth transfer through tax law changes; 5) increased public
financing; 6) third-party empowerment; 7) committee medicine
("comparative effectiveness"); and 8) health information
technology to monitor doctors and keep them in line.
The proposed reform will fail, McKalip writes, "but only
after destroying a profession, killing patients, and further
bankrupting our country. We shall see if enough real doctors
remain to raise our profession from the ashes."
Even those who believe these reforms are very desirable
state that they are ineffective as cost-control measures.
"Savings would depend on the political willingness to reduce
payments to medical providers" (Ann Intern Med
2009;150:485-495).
The May 11 "major announcement" by the Administration and
"health care industry leaders," who promise to take steps that
"could save the country $2 trillion over the next 10 years,"
depends on precisely such measures. They are outlined in a letter
from AMA, AHA, PhRMA, AHIP, AdvaMed, and SEIU, posted at
www.HealthReform.gov. The potential "savings" a reduction
of the growth rate of spending by 1.5% annually accrues partly
to the private sector, and is a minuscule fraction of the $86
trillion in Medicare's unfunded liabilities. Moreover, the
Congressional Budget Office and CMS assume a significant downward
bending of the historical growth curve in making their forecasts
(www.john-goodman-blog.com 5/11/09).
It appears likely that private insurers are trying to stave
off the inclusion of a "public option" a middle-class entitlement
that they see as the beginning of the end of private insurance
(Wall St J 4/13/09). Indeed, Rep. Jan Schakowsky (D-IL)
said it was simply the opening salvo against the private sector.
Printing Capital
The latest projection for the budget deficit is $1.84
trillion, or 12.9% of GDP. The increase of $89 billion since
February reflects corporate bailouts, higher safety-net spending,
and weaker tax receipts (Reuters 5/11/09). Private sector payroll
fell by 611,000 in April, approaching an annual loss of 6 million
jobs, a rate unprecedented since the data has been tracked,
starting in 1939 (www.ritholtz.com/blog).
Some "green shoots" may be sprouting, but they will not flower in
the barren economic landscape, regardless of how much they are
fertilized with trillions of sweat equity dollars from current
and future generations, writes Gerald Celente (Rense.com 5/7/09).
Bernanke's "quantitative easing" hasn't worked. It would be
ludicrous to expect a limp $300 billion to hold back an avalanche
of trillions in new government obligations. Note that foreigners
now hold 50% of U.S. Treasuries, increased from 20% in 1994 (http://immobilienblasen
.blogspot.com 5/1/09).
The U.S. has borrowed nearly all the money that foreigners
are willing to lend, and taxation is well past the peak of the
Laffer curve. The needed trillions can only be obtained by
inflating the money supply on a previously unimagined scale.
Capital cannot be printed but wealth can be gradually confiscated
through taxation by claiming that its price rise is a "capital
gain." The government is buying up the private property of
Americans with their own money, writes Arthur
Robinson seizing their freedom along with their remaining capital
(Access to Energy, August 2008).
Escaping the Dependency Trap
The government can throw counterfeit dollars into the
system, but requires cooperation if any medical care is to be
provided. That is why the AMA is invited to the White House.
Physicians who accept public money become wards of the
government and will have to comply with increasingly severe
constraints on their ability to serve patients. Nominally private
insurers allowed to remain will also enforce rationing.
How can we thwart the takeover of medicine by the giants
with the money and the power? "Here is how," writes AAPS
President-elect George Watson, D.O. "Everybody opt out of
Medicare, and cancel all insurance contracts, especially HMO
contracts." Physicians are close to being indentured servants.
"It's time for real change away from dependency."
Our new masters dream of controlling the entire world,
writes Robinson. "Otherwise they will fail. If freedom survives
in any major region, that region will grow, prosper, and overcome
them just as the U.S. overcame its competitors in the 20th
century." An enclave of freedom in medicine is also a threat:
hence the demand for "everybody in, nobody out."
Take the train that's going to Galt's Gulch not the one
headed over the cliff.
"I wonder what other business...has to spend 6-12% of its
income to get paid?" writes Brian R. Riveland, M.D., president of
Maricopa County Medical Society (Round-up, May 2009).
If overhead is 50%, then 12% of the gross is 24% of your net
income. For many practices, overhead is much greater.
Instead of worrying about a 22% cut in Medicare
reimbursement, Dr. Watson suggests asking what would happen if
you lost 22% of your patients by opting out, but could greatly
decrease overhead. Junk the CPT, ICD-9, and ICD-10. A reviewer
can look at the plain English description of the procedure and
decide that you used the wrong code.
"If they know that, then we don't need the codes in the
first place," he writes.
Dr. Watson started over in October 2003 with no patients, no
charts, and no insurance contracts. When he bought another
practice in 2005, he expected that because of his policy of no
insurance, he would lose the 25% of patients on Blue Cross/Blue
Shield, and the 20% on Medicare. In fact, he lost very few,
because he could charge a fair fee.
Many doctors have decided that they cannot afford more
Medicare patients. The Medicare Payment Advisory Commission
reported in 2008 that 28% of Medicare beneficiaries looking for a
primary physician had trouble finding one, up from 24% in 2007.
The Texas Medical Association found that only 38% of primary
physicians in Texas accepted new Medicare patients. Only 50% of
physicians accept Medicaid.
In New York, the annual drop-out rate from the state's
largest HMO is 10% (Marc Siegel, Wall St J 4/17/09).
The first of three policy option papers was released by Sen.
Max Baucus (D-MT) and Sen. Charles Grassley (R-IA); the AMA
invited comments by Federation members. One holdover from the
Clinton Plan is no administrative or judicial
review of critical items such as the method for
calculating "value-based" payments and the selection of quality
measures.
There are onerous maintenance of certification programs,
including proficiency in "system-based practice," with re-
enrollment required every 5 years. The level of screening depends
on the Secretary's estimate of the risk of noncompliance; a
surety bond of up to $500,000 may be required.
On p. 16 of the 52-page summary are comments on physician
payments; most of the "updates" have minus signs.
An "independent expert committee," possibly formed by the
HHS secretary, will work out the methodology for comparative
effectiveness research no mention of the grand challenge of
dealing with petabytes of poorly characterized data collected by
thousands of persons of varying levels of training.
The plan is supposed to address "health disparities" not
just differences in care. What about folks with bad genes?
Enforcement provisions include fines of up to $10,000 for
each instance of "medically improper or unnecessary care" (as
determined by the Secretary). Payments can be suspended during an
investigation. The testimonial subpoena authority would be
extended to program exclusion investigations. New civil monetary
penalties are added for failure to submit data, and there are
more reasons for reporting to the National Practitioner Data
Bank. CMS will be able to withhold payments if a facility should
fail to meet "health and safety standards." Will any small
offices measure up?
The patient's role in solving the high cost of medical care
is the subject of the enclosed book, first in a series of six.
You can order in bulk to distribute to patients and opinion
leaders: go to www.alethospress.com/aaps.htm. AAPS receives a share of the purchase price. At
www.freemarkethealthcare.com, authors Dattilo
and Racer refute common socialist myths.
It's been postponed to 2013, but the ICD-10 coding system
will require modification of virtually all health information
programs, including electronic medical records. There are 10
times as many codes. The transition is estimated to cost a three-
physician office more than $80,000; additional coders and
increased documentation time will be a permanent ongoing cost.
HHS anticipates a possible significant disruption in claims, and
an initial 10% error rate (Physicians Practice, March
2009).
Most of the 45% of 40 million uninsured who are without
health coverage for less than 4 months are between jobs. Nearly
half are eligible for retroactive COBRA coverage for 3.5 months
before a premium is due. It is expensive; why pay if it's not
necessary? Of the remainder, 4 5 million are actually enrolled in
Medicaid but undercounted, according to the Congressional Budget
Office. There are also millions who can apply for Medicaid any
time they need a significant medical service, and receive
retroactive coverage. Between 25% to 43% of the uninsured
population are illegal aliens; the Center for Immigration Studies
estimates that 75% of the increase in uninsurance over the past
15 years results from immigrants and their children. Medical care
is available without insurance; besides EMTALA, a Google search
for "free medical care" turned up 275 million Web sites,
including 13,500 in Maine. Only 2,000 previously uninsured
individuals, of a claimed 135,000 uninsured, bothered to sign up
for Dirigo Health, notes Gerard Gianoli, M.D. (ENT
Today, January 2009).
Dr. Gianoli has been third-party-free for 3.5 years.
Here is "strong circumstantial evidence" that "universal
health insurance coverage sharply narrows disparities": In the
NHANES study, the difference between mean systolic blood pressure
of blacks and whites is 7.0 mm Hg before age 65, and only 2.8 mm
Hg after (Ann Intern Med 2009;150:561-562)!
Jun 5-6, 2009. Workshop on Building a Healthy
Independent Practice, briefing, and board meeting, Dallas, TX.
A safety net is supposed to catch people when they fall.
True insurance is a safety net.
A dragnet entangles everyone, even those who don't need
help. Social Security and Medicare are classic dragnets. Such
programs give politicians vast power, foster dependence, and
create huge constituencies who will fight to preserve them
(Downsizer-Dispatch 4/16/09, www.downsizedc.org).
As the liabilities of these Ponzi schemes mount, law-
enforcement dragnets are seeking to capture the providers and
suppliers of the promised benefits.
"State Medicaid agencies are likely to become more
aggressive as they search for revenues desperately needed to
cover budget gaps created by the recession," states N.Y. attorney
Robert Belfort. Medicaid Fraud Control Units (MFCUs) "recovered"
more than $1.1 billion, even more than the Medicare Recovery
Audit Contractors (RAC) pilot program, and obtained 1,205
convictions and 805 exclusions from Medicare and Medicaid
programs (MCA 4/20/09).
After 10 years in court, Utah MCFU officials won summary
judgment on most of the claims against them, and prosecutorial
immunity was affirmed, in the case of Becker v. Kroll,
Case No. 2:02-CV-24 TS. Qualified immunity was, however, denied
to chief inspector Jeff Wright. By withholding exculpatory
evidence from the prosecutor, Wright caused neurologist Taj
Becker, M.D., to "suffer an injury a retaliatory
prosecution which would chill a person of ordinary firmness from
continuing to engage in the public debate about MFCU" (BNA's
HCFR 4/8/09). See AAPS News, October 2007. For decision see: http://op.bna.com/hl.nsf/r?Open=jthn-7qurqt.
Along with durable medical equipment suppliers and
diagnostic testing facilities, physicians are already under
intense scrutiny as they try to enroll or re-enroll in Medicare,
warns consultant Belinda Holmes. Carriers and Medicare
Administrative Contractors (MACs) have no way to distinguish
innocent mistakes from attempts to defraud. Re-enrollment means
starting from scratch; you'll need copies of professional degrees
and licenses. If there is a mismatch in the business name the IRS
has on file and the rest of the documentation, the applicant has
to appeal to the IRS. If there are outstanding overpayments, the
application will be rejected (MCA 5/4/09).
Using data mining, new Medicare program integrity
contractors are expected to generate criminal referrals to the
Department of Justice. The DOJ, "surprisingly," received none
during the demonstration projects. Billing aberrancies should
trigger law enforcement involvement because of the possibility of
fraud (BNA's HCFR 5/6/09).
After certifying that Tenet Healthcare was in material
compliance with a corporate integrity agreement, program director
Christi Sulzbach faces an $18 million bill plus treble damages.
Lessons: make sure you understand what a government document
requires, and be careful what you certify to the government
(HIPAA Compliance Alert, June 2008).
Unlike Oregon and Washington laws, the Montana "right to
die" law does not include a provision for physicians to opt out.
First District Court Judge Dorothy McCarter ruled, in a case
backed by Compassion & Choices (formerly the Hemlock Society),
that this means a patient has a constitutional right to obtain a
prescription for a lethal drug (Baxter v. Montana). An
appeal is pending before the Montana Supreme Court.
"The laws governing the medical profession say the medical
profession is to heal, not to kill," argues Montana Assistant
Attorney General Anthony Johnston.
The Christian Legal Society and the Christian Medical
Association filed an amicus brief supporting the conscience
rights of medical professionals.
"There is certainly a push from government to tell people to
set aside religious or ethical qualms and to abide by whatever
the government tells you is appropriate," states CLS attorney M.
Casey Mattox (World Net Daily 5/2/09).
Foundation funding is fueling the ongoing effort to change
Americans' attitudes toward death and to overturn Judeo-Christian
morality. In 1997, the AMA began a program to "educate"
physicians about end-of-life care, after receiving a $1.54
million grant from the Robert Wood Johnson Foundation (NY
Times 11/22/97). RWJF played a leading role in the Clinton
Task Force on Health Care Reform, which prominently featured
"futile care" and related issues. Zeke Emanuel (AAPS News,
April 2009) was a prominent
participant in the "Ethical Foundations of the New System"
cluster group.
Also a part of the "Clinton team," George Soros funds the
Project on Death in America (PDIA). Soros's plans for America are
indistinguishable from Obama's, writes Joy Tiz (Canada Free
Press 5/8/09; 2/18/09). Called the "world's largest single
donor" by the New York Times, Soros uses his
philanthropy to deconstruct the moral values of the Western
world. He asserts that laissez-faire capitalism is a greater
future menace than Nazism or communism. His "Open Society
Institute" rejects ordered liberty and favors radical
redistribution (Forbundet Mot Rusgift, fmr.no
1/15/97).
Soros doesn't think much of conscience it "clouds an
investor's judgment." He has said he has no remorse for work he
did in Hungary in the 1930s: handing out flyers deceptively
directing Jews to turn themselves in for deportation to the death
camps, and helping to confiscate Jews' valuables (David Horowitz
and Richard Poe, The Shadow Party, 2006).
Human lives are expendable in a socialist society, Tiz
warns. Oppressed humans do not value their own lives or the lives
of others as do citizens in a free society.
Said Soros of himself: "I am sort of [a] deus ex machina I
am something unnatural" (fmr.no, op. cit.).
A New Jersey appellate court ruled that a patient could sue
her physician for failing to provide her with informed consent
when the physician did not tell her that a fetus is a "complete,
separate, unique, and irreplaceable human being" (Acuna v.
Turkish). The N.J. Supreme Court overturned the ruling on
the basis that there is no consensus in the medical community
or society concerning the nature of an 8-week embryo.
The court refused to set public policy on when life begins, notes
Dr. Lawrence Huntoon, "but it does set policy that issues of
biological fact shall be decided by consensus of society."
News from New York. AMA president and "home town girl"
Nancy Nielsen was the featured speaker at the annual meeting of
the Erie County Medical Society in Buffalo. She is quite taken
with Michelle Obama and with being frequently invited to the
White House so the Administration can ask her about the AMA's
opinion on health care reform. Based on her conversations, it
appears that fee for service in Medicare is headed for the trash.
Obama is reportedly committed to scrapping the sustained growth
rate (SGR) payment formula, but the money will have to come from
somewhere. The new method will apparently be "quality-based"
(read P4P) and outcomes-based payment of some sort. The AMA seems
to be fully on board. Nielsen sees in Obama and the current
Congress the opportunity to move ahead with the agenda of
insurance coverage for everyone lack of which she sees as a moral
stain. The AMA also plans to "bend the cost curve," especially
for chronic care, which she says doctors don't do well. She's
asked specialty societies to list their top three chronic
conditions and find ways to decrease costs.
Although the Medical Society for the State of New York
(MSSNY) teamed up with the AMA to expose the fraudulent database
implemented by UnitedHealthcare, MSSNY now runs a
UnitedHealthcare ad: "Healing health care. Together. "
One of the "highlights" of the MSSNY meeting was "to
recognize Assemblyman Gottfried's and Senator Duane's NY Health
Plus proposal as a possible first step toward addressing the
problem of the uninsured and healthcare delivery throughout the
state." They want to expand Medicaid HMO plans.
In 2008, NY recovered $263.5 million from Medicaid fraud,
compared with $113.6 million in 2007, and $59.3 million in 2006.
One of the largest single settlements ($35 million) came from the
largest managed-care plan (Buffalo News 5/6/09).
The average age of physicians in our area is 55 to 60.
Government Management. Every business in America is
supposed to verify Social Security numbers. When the auditor's
office in Washington State looked at Medicaid eligibility in
2006, it identified 2,741 Medicaid clients who appeared to have
invalid SSNs or to have made claims after their deaths. An
intensive examination of a set of 267 turned up 66 cases of
provider fraud, 57 of using a deceased relative's SSN, 65 cases
of probable theft of an unrelated deceased person's SSN, 29
departmental errors, and 3 cases of probable theft of a living
person's SSN. These sample cases generated nearly $4 million in
expenditures. Questionable payments for the nonemergency
treatment of illegal aliens amounted to nearly $55 million.
Outsourcing. We may see medical care being outsourced
to the best centers in the world because our system is too
expensive. I have no doubt that U.S. physicians can compete on a
global level in value but not if they are a part of Fannie Med
and Freddie Doc, or any managed-care arrangement. There are
successful "centers of excellence" started regionally with cash-
based surgeons in the U.S., with prices at international levels.
But they have to opt out of the current system.
"New" Payment System. In a new bold experiment,
Massachusetts may replace fee-for-service payment. "A single,
yearly fee is intended to discourage doctors and hospitals from
providing unneeded tests and treatments" (Boston Globe
5/7/09). It is hoped that doctors and hospitals will "coordinate"
care better, and thereby improve quality.
As a boy, I recall an Australian physician visiting our home
for a week in August. The government capped his salary, and he
had earned the maximum by June 1. He traveled the next 7 months
of the year, and ultimately moved to the U.S.
Unity. Libertarians, neocons, the religious right, etc.
all seem to undermine their principal common denominator,
personal liberty, by feuding among themselves. We are where we
are because the opposition is so organized, and so in control of
the corrupt media, that their tent (which has far more
contradictory factions than ours) manages to keep all their sheep
inside.
Our leaders need to organize the message that would resonate
with the vast majority of the public. They have not learned to
press the simple question: "Do you believe in freedom of action,
or do you prefer to be a ward of the state?"
Growth of Insurance. As late as 1965, only 72% of the
population had any coverage at all, and that was for hospital-
ization typically 21 days inpatient per year. Only 50% had "major
medical." The huge growth in coverage was achieved without any
mandates at all.
Myth Pronounced Dead. Preventive medicine (Pap smears,
mammograms, checkups, prostate cancer tests, etc.) is a
consumption good, not an investment. Politicians keep repeating
it, but the myth of cost savings died decades ago. Here's a
recent nail in the coffin: "[C]ost-effectiveness ratios...from
studies published between 2000 and 2005 [show that] less than 20
percent of the preventive options...fall in the cost-saving
category (Russell LB Health Affairs 2009;1:42-45).
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