AAPS NEWS

Volume 66, no. 11, November 2010

WAIVER NEEDED FOR ALL AMERICANS

On the eve of the mid-term election, McDonald�s and 29 other companies have been granted a one-year waiver from an ObamaCare mandate that would have cost up to 1 million workers their health insurance coverage. The biggest single waiver goes to a New York teachers union.

The Patient Protection and Affordable Care Act (PPACA) requires a medical-loss ration (MLR) as high as 85%. McDonald�s and trade groups say it is unrealistic to expect �mini-med� plans to spend that high a percentage on benefits because of the high administrative costs, owing to frequent worker turnover.

To block a repeal effort, the Administration needs to stave off bad publicity from an early spike in the number of uninsured. Groups sympathetic to PPACA plan to spend $125 million in advertising for it over the next 5 years�in addition to the taxpayer-funded promotions. These included four-color mailings to all Medicare beneficiaries, plus television commercials and Parade magazine ads featuring Andy Griffiths.

HHS Secretary Sebelius spun a return of $156 million to policyholders of Blue Cross Blue Shield of NC as a result of the �new accountability� in health care reform. Actually, BC/BS is liquidating reserves that will no longer be needed when it terminates much of its current individual business. Policies purchased or substantially modified between now and 2014 won�t be grandfathered (Wall St J 9/29/10). BC/BS didn�t get a waiver.

Also not getting a waiver from MLR requirements are consumer-directed health plans. A traditional policy that spends $3,400 on patient care and costs $4,000 has an MLR of 85%. If the patient takes control of $800 more in spending through a higher deductible, and the premium goes down $800, the MLR becomes 81.25% ($2,600/$3,200). There is no real difference, but the accounting looks worse (PRI, September 2010).

No Equality Under the Law
The discriminatory nature of ObamaCare is shown by the very promises made in order to mute opposition in the first place. For example, �If you like your plan you can keep it� [if it still exists]. What about those who don�t have a plan they like? Why can�t they buy a new one that they like, instead of one approved by the Secretary? What about young people just entering the market?

Eventually (soon) the grandfathered elements will be gone, and the Secretary�s infrastructure will be entrenched. In charge of an annual budget of $1 trillion, Sebelius has been granted godlike power to grant or withhold indulgences�reprieves from the regulatory guillotine. Her attitude toward her subjects is already apparent. That ObamaCare is deeply unpopular means that �we have a lot of re-education to do.� Public relations is just a start.

As the costs of maintaining an expensive welfare state increased in Britain, the prevailing view of the typical citizen morphed from knight into knave. With the perspective that they are obstacles to rather than enablers of healthcare reform, U.S. physicians are being portrayed as knaves or pawns (JAMA 9/1/10). The Secretary will determine the behavioral change needed for doctors to get paid.

When health insurers dared to raise premiums to cover the cost of mandates, Sebelius wrote: �There will be zero tolerance for this type of misinformation and unjustified rate increases.� In response, Michael Barone called the Obama regime a �Gangster Government.� He writes that �the threat to use government regulation to destroy or harm someone�s business because they disagree with government officials is thuggery.�

ObamaCare is based on an engineering model, much admired by CMS head Donald Berwick, M.D. The experts think their plan will work, even though everyone at the bottom has a self interest in defeating it. John Goodman contrasts this with the economic model, based on incentives and freedom (Health Alert 8/30/10).

ObamaCare resembles the 19th century system in France and Prussia, where the state set standards for schools and professions. �Political equality and self rule were purely theoretical,� writes Angelo Codevilla (American Spectator, April 2009), �while personal latitude was at the discretion of the bureaucracies.�

Aristotle teaches that relationships among equals depend on persuasion. Conversely, persuasion is the currency of politics only in so far as persons are equal under the law.

Codevilla warned that when Barack Obama said, �We will restore science to its rightful place,� he meant that under his Administration, people would have fewer choices because those choices should be rightfully made by those who rule with the authority of science. �Claiming ownership of [science] practically negates political equality, if not human equality altogether.� Power passes to those who certify the experts as experts.

The delegation of power to �independent� executive agencies that began in the New Deal revolutionized the relationship between Americans and their government. Exercise of this �power by pretense� to exclusive scientific authority is incompatible with the American system of government or respect for individuals.

Waivers v. Freedom and the Rule of Law
What gives the Secretary the authority to exempt some from the law? Or to subject others to ruinous administrative rules? The remedy for a law that doesn�t work is repeal�not selective nonenforcement. Let the popular anger descend on the failed sorcerers� apprentices�and the legislators who empowered them.

Repeal HITECH Also

ObamaCare is just one part of �the impending complete deprofessionalization of medicine,� writes Scot Silverstein, M.D. �HITECH gives an enforcement mechanism.�

The Health Information Technology for Economic and Clinical Health Act �is a bastard child of the debacle known as ObamaCare, and it was smuggled into existence under the umbrella of the equally onerous ARRA [American Recovery and Reinvestment Act],� the so-called Stimulus Bill.

The Institute of Medicine is going to conduct a one-year study of HIT safety�although �it�s painfully obvious this technology is not yet safe, and worse, the degree of risk is not even known.� The 2009 National Research Council study on HIT that showed this was basically buried, Silverstein notes.

Licensure boards, he writes, are beginning to consider whether maintenance of licensure should be contingent on use of HIT�this is �crazy talk.� Studies show that �HIT medical devices are experimental, yet increasingly serve as governors of medical care� (http://hcrenewal.blogspot.com 4/13/10, 10/1/10).

�It�s not the use of HIT that needs to be encouraged; it�s the remediation of HIT that needs to be encouraged/enforced to make HIT useful.�

Only 1% Re-certify Voluntarily

In a letter to the editor of NEJM on Jun 24, David L. Keller, M.D., writes that he found the process of his first 10-year recertification was �time-consuming, expensive, and stressful.� He was not surprised to learn from Levinson et al. that less than 1% of time-unlimited diplomates of the American Board of Internal Medicine choose to recertify (NEJM 2010;362:948-952).

Bending the Cost Curve�Up

Almost 30 years before PPACA created first-dollar coverage for preventive care, we knew that first-dollar coverage for anything creates enormous waste. The multimillion-dollar RAND Health Insurance Experiment showed that people with high-deductible insurance (about $2,500 in today�s prices) spent about one-third less on medical care, without adverse effect on their health ( www.john-goodman-blog.com ).

Previously, personal health spending was close to one-fifth of family income. Under PPACA, the mandatory insurance will cost about 50% of the wages of a $30,000/year worker. The program can�t be sustained without mandates, but subsidies are necessary to �avoid causing gross hardship,� writes Henry Aaron (NEJM 10/6/10). In a high-cost area, the subsidy for a 55-year-old with a family of four and an income of $80,000 would be nearly $11,000, notes Dave Racer. The plan is projected to generate a huge increase in demand, including about 901,000 additional emergency-room visits annually, writes Goodman. PPACA assures that there will be no new supply of services to meet the demand. While the Congressional Research Service (CRS) will not make its own cost estimates for states, it notes that various states have calculated implementation costs ranging to $7.1 billion for Virginia. Extrapolating across other states gives a total of perhaps more than $300 billion, using CBO rules (CPR 9/13/10). No wonder so many states are demanding the equivalent of waivers!

AAPS Officers Elected

At our 67th annual meeting, Alieta Eck, M.D., of Somerset, NJ, was elected President-Elect. Charles McDowell, Jr., M.D., of Johns Creek, GA, is Secretary; W. Daniel Jordan, M.D., of Atlanta, GA, is Treasurer; and new Directors are Claud A. Boyd, Jr., M.D., of Augusta, GA; Robert J. Cihak, M.D., of Brier, WA; Howard F. Long, M.D., of Pleasanton, CA; Juliette Madrigal-Dersch of Austin, TX; and E. Lee Vliet, M.D., of Tucson, AZ.

Resolutions on ObamaCare and MOC

At the 67th annual meeting in Salt Lake City, the general assembly passed the following two resolutions:

BE IT RESOLVED THAT: AAPS will vigorously work to cause Congress to repeal the PPACA, and to prohibit Congress from replacing it with another unconstitutional law that interferes with the practice of medicine.

BE IT RESOLVED THAT: AAPS oppose mandatory maintenance of certification, and encourage physicians to strive constantly to improve their care of patients by the means they find most effective.

District Walks; Mini-demonstrations

Will Summers, M.D., of Albuquerque, NM, reports that in walking a single block, he found two Hispanic names listed at nonexistent addresses. One would have been in the middle of a cross street. Further, at one address there were eight voters listed with distinctly different names, in a house unlikely to hold that many families. As a likely cover, some were listed as Republicans. ACORN has apparently been performing voter magic. He asked volunteers to collect all such observations, preferably with photos, and send them to him. A compilation could be publicized and reported to uncorrupted legal authorities, if any can be found.

The media might black out your events, but the �rolling rallies� in Albuquerque on Sep 12 were seen by an estimated 141,000 people. For safety, demonstrators set up at video camera intersections, which are observed 24/7 from Oklahoma City, punched in (and tested) a buddy�s contact number into their cell phones, and had a camera. Volunteers counted cars passing in both directions for 5 minutes mid-way through the demonstration.

AAPS Calendar

Oct 18-19. Forums with congressional candidates Peter DeFazio and Art Robinson, Roseburg and Coos Bay, OR; dinner meetings, Dr. Jane Orient and AAPS members.

Oct 19. Dinner and talk by Andrew Schlafly, Bismarck, ND.

Jan 21, 2011. Workshop, Dallas, TX; Jan 22 Board meeting.

Sep 28-Oct 1, 2011. 68th annual meeting, Atlanta, GA.

Oral Argument Held in AAPS v. TMB

In Houston, Oct 6, the U.S. Fifth Circuit Court of Appeals heard an oral argument in the AAPS case challenging violations of physicians� due process rights by the Texas Medical Board.

The key issue is whether an association has standing to bring an action, when each case requires individualized proof. Andrew Schlafly argued that only an association could prove a pattern of abusive practices. Chief Judge Edith Jones noted that actions in other cases would not be germane, so an individual physician could not discuss them at all.

One judge stated that if AAPS allegations were true concerning anonymous complaints made for anticompetitive reasons, it was a �horrible situation.� Even if some cases were valid, there was still a problem with the process. Defense was so expensive that the process could be used for extortion.

One judge stated that �anonymous complaints are inherently subject to abuse.� How could a doctor defend himself against a specific allegation without knowing the patient involved? This is one reason why the Bar does not allow anonymous complaints against lawyers. Even if actual abuse is not proven in this case, the potential for abuse is there. Judge Jones asked why anonymity would be needed since complaints are confidential.

A recording of the argument is available on the Court�s website, linked to www.aapsonline.org/newsoftheday/001327.

AAPS Amends Complaint, Challenges PECOS

In its amended complaint in AAPS v. Sebelius, AAPS asks the Court to enjoin the Department of Health and Human Services (HHS) from �requiring non-Medicare providers to enroll with Medicare, to appear in PECOS, or to obtain a National Provider Identifier (�NPI�) absent another criterion�e.g. engaging in HPAA transactions��that independently requires an NPI.�

Additionally, AAPS asks the Court to declare that nothing in Medicare or other law �requires physicians to opt-out pursuant to 42 U.S.C. �1395(b)�s statutory safe harbor in order to lawfully treat Medicare beneficiaries for payment outside Medicare.�

This safe harbor is more restrictive than required. �Non-enrolled physicians need only notify prospective patients of their non-enrollment in accordance with any general laws on advertising and trade practices.� AAPS notes that the ability of non-enrolled physicians to order or refer for services provided by enrolled entities enables Medicare beneficiaries to pay directly for services from a non-enrolled physician of their choice without renouncing all their Medicare entitlement.

AAPS strengthens the case for the Court�s requiring HHS and the Social Security Administration (SSA) to submit a report on the solvency of Social Security and Medicare. In March 2010, the Congressional Budget Office (CBO) reported that Social Security would pay out more revenue than it received in 2010, something that has not happened in decades and that SSA said would not happen until 2016. The economic downturn resulted in less revenue from payroll taxes and more claims.

The August 2010 trust fund reports �rely on the same budget gimmickry that the Officer Defendants and their legislative allies used to claim that PPACA would lower the federal deficit.�

�The majorities in both houses of Congress also wish to maintain that storyline, regardless of actual solvency. The statutory reports to Congress are inadequate to protect the interests of those who rely on Medicare and Social Security.� The full complaint is posted: http://www.aapsonline.org/hhslawsuit.

Alliance for Natural Health USA has joined as coplaintiff.

Tens of Thousands Not in PECOS

National Government Services MEDICARE reported at the end of September that 16,000 practices in New York State were still not in PECOS. Medical director William Mangold, M.D., reported that Noridian had 30,000 applications pending.

The Medical Society of Erie suggested scrolling through the 13,000-page list at www.cms.gov/MedicareProviderSupenroll/downloads/OrderingReferringReport.pdf to check your enrollment. If you have not done anything to update your enrollment since 2003, such as changing an address or phone number, or adding or deleting a provider, you are probably not in the file.

According to the American Academy of Neurology, opted-out physicians who have all the correct paperwork filed need not enroll in PECOS but should check with their contractor to be sure they are properly listed.

Confusion about Privacy

Because of the HITECH Act, the HIPAA Privacy Rule is being revised to prohibit disclosure of information to a health plan if the patient requests, and the bill has been paid in full out of pocket, and the disclosure is unrelated to treatment. (Clear?) Such payments cannot be applied to the deductible (Medical Practice Compliance Alert 9/20/10).

A suggested form for patients to use is posted at: http://patientprivacyrights.org/patient-privacy-toolkit/. Click on �Private Pay Form.�

HITECH also expanded the number of entities authorized to look at personal health information without patient consent from about 600,000 to more than 2 million. It also permits the sale of electronic health records for public health or research purposes (Health Freedom Watch, September 2010).

PPACA authorizes the federal government to access the records of all patients participating in federally supported health programs for data on �race, ethnicity, sex, primary language, and disability status,� as well as �any other demographic data deemed appropriate by the Secretary regarding health disparities� (�4302).

Both raw data and analyses will be available to the public by internet. �It is impossible to believe that the confidential nature of the doctor-patient relationship can survive in this environment,� writes Arie Friedman, M.D. (American Thinker 9/20/10).

Challenge on CPT Issued to AMA

Adam Frederic Dorin, M.D., who helped organize the National Doctors Tea Party in San Diego, has challenged the AMA to �release the medical billing code copyright monopoly and assign the codes to the public domain in an internet-based freeware system� (www.physiciansagainstobamacare.org). This would save American physicians up to $100 million annually, he states, and would put the AMA on a level playing field.

Correspondence

MOC. I asked Catherine Rydell, executive director of the American Academy of Neurology (AAN), two questions.

(1) What is the estimated cost for a neurologist to comply with the maintenance of certification program (i.e. to recertify once)? Answer: �There is clearly no way to determine the full financial or time cost for neurologists to comply.�

(2) Is the MOC program evidence based? Answer: �To the best of my knowledge there is no evidence to demonstrate that MOC improves quality of care or patient safety.�

Ms. Rydell also states that �many if not all boarded specialties have been struggling with these same issues since the inception of MOC by ABMS.� But despite a �loud unified voice� of opposition, �those directing MOC and federal health care reform may listen but rarely �hear.�� Clearly, this is a top-down-control modus operandi, not unlike ObamaCare itself. The tail is wagging the dog, and the collectivists are controlling the tail.
Lawrence R. Huntoon, M.D., Ph.D., Lake View, NY

The Agenda. ObamaCare is specifically designed to create single payer. The public option nonsense and the insurance exchanges are just smoke and mirrors. An exchange means nothing when all you have are a couple of local hospital networks organized as HMOs run by the state. The Left has been testing it for years. It has acted like a death ray on private medicine everywhere its essentials have been implemented�TennCare, KentuckyKare, the Oregon Health Plan, RomneyCare, Dirigo Care, Keiki Care, and reforms in New Jersey, New York, and Vermont. I guess they kept rolling out variations on the same theme just to make sure it would fail when it went national.
Linda Gorman, Ph.D., Independence Institute, Golden, CO

Key Points on ACOs. From a preliminary analysis of �3022 and �10307 of PPACA, which create accountable care organizations, I conclude that organized medicine must help doctors who choose not to participate and possibly should actively discourage participation for the good of doctors and patients.

ACOs are entirely about money, not quality. That is why they are called a �shared savings program.� Doctors will gain only if there are savings for Medicare�as tens of millions of patients enter a program with budget shortfalls in the hundreds of billions. The Secretary of HHS has monarchal powers: She can set the projected national expenditure level so low that there is no payment for doctors; exempt some �highly integrated� groups, such as very large institutions or academic centers, from capitation, giving them a competitive advantage; remove an ACO from the approved list or withhold its payments. Hospitals will have enormous power, having positioned themselves for many years, preparing for this day when payment to doctors depends on hospital expenditures. While participation is supposed to be voluntary, the pressure to become obedient subjects will be enormous.
David McKalip, M.D., St. Petersburg, FL

Double Standard. McDonald�s employees can pay $14/week ($728/yr) for a policy with a maximum benefit of $2,000, or $32/wk ($1,664/yr) for a policy with a maximum benefit of $10,000. Such a �mini-med� policy is like car insurance that pays for windshield wipers but leaves you vulnerable to property damage and bodily injury liability. The current Administration gives them a waiver. My practice offers a high deductible health plan (HDHP), and I help fund the Health Savings Account. Yet somebody in Washington, D.C., is always trying to shut down the type of thing I offer as somehow unfair to workers.
Russell W. Faria, D.O., Kent, WA

Medical Loss Ratio and Job Loss. The first ax fell within the insurance industry. With the mandate of an 80% loss ratio, companies send their service jobs overseas. I have talked to several major companies that have had major cuts in staff. When will we wake up to what is happening with this nightmare? Now that individual and small group insurance is mandated to have �unlimited� coverage for mental health/psychological benefits, perhaps the enormous increase in premiums will be offset by the care I can get to help me cope with the nightmare.
James Reany, CLU/ChFC, Phoenix, AZ

Federally Funded Civilian Medical School. Another provision hidden in PPACA reminds me of the Soviet Union. I was there in 1974 and 1975�it was a scary place with palpable oppression everywhere. The program entitled the �U.S. Public Health Sciences Track� is the first federally funded and administered civilian medical school that grants advanced degrees in medicine, nursing, dentistry, and pharmacy. Administration officials will act like college deans, with the Surgeon General in charge of operations and curriculum, and the Secretary of HHS in charge of funding.

�Like the grants and contracts sections of the health care reform law that require the use of race-based criteria for awarding federal money...for medical training programs,� writes Diane Cohen, attorney for the Goldwater Institute, �the Surgeon General is required to create race-based selection procedures for admitting students to��Obamacare University.�� This racial discrimination reinforces the importance of GWI�s legal challenge.
Elizabeth Lee Vliet, M.D., Tucson, AZ