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Association of American Physicians and Surgeons, Inc.
A Voice for Private Physicians Since 1943
Omnia pro aegroto

Volume 62, No. 10 October 2006


For all the government and academic cant about "evidence- based" medicine, reform proposals sweeping the states and hawked by candidates are decidedly non-evidence based.

"The tax on medicine to fund medicine is like the gas siphoning solution to the gas shortage," writes Gerald Yorioka, M.D., of Everett, WA.

"Taxing people with insurance to subsidize other people's insurance" as with the Massachusetts surcharge on health plans is a prescription for an infinite cost spiral, writes Linda Gorman of the Independence Institute.

Medicare adds such a tax in 2007, a surtax on Part B premiums for individuals with an adjusted gross income greater than $80,000 a little-known provision of the 2003 Medicare Modernization Act, which also brought us Part D. By 2015, seniors with incomes over $200,000 will be paying about $4,700 annually for Part B, according to CMS estimates plus tax on the income represented by the benefit.

Shortages and cost spirals result from attempts to replace the natural regulator of free-market prices with administrative pricing. Gorman calls it "a grand experiment on the whole population...with no informed consent forms required." And no heed paid to the outcome.

Although the grand scheme of the Clinton Health Security Act was temporarily derailed, the fallback plan of piecemeal implementation in state "laboratories of democracy" proceeds. Model legislation designed by the Robert Wood Johnson Foundation (RWJF) has been enacted: as in New York, New Jersey, Kentucky, and Tennessee. "Regardless of the wreckage," writes Gorman, Massachusetts and Maine fell back on "if at first you don't succeed, try, try again."

Gorman thoroughly debunks the reformers' deeply held beliefs in a Health Care Policy Center Newsletter, August 2006, (www.i2i.org) and other writings.

The Myth of Cost-Saving Primary or Preventive Care

It is claimed that lack of insurance leads to lack of primary care, which results in more sickness and more use of the emergency department. In fact, the publicly insured are over- - represented among ED users, and having a source of primary care does not seem to affect ED use. Insurance status also made little difference in the percentage of recommended care acute, chronic, or preventive received by those who made at least one visit to a medical facility in the previous 2 years (Asch SM, et al. N Engl J Med 2006;354:1147-1156).

Specialist care is supposed to be more expensive. Yet a study of consumer-directed care by Aetna and Humana showed that while consumers chose to consult more of the expensive specialists, total costs nevertheless went down.

Although preventive care (or early detection) may well improve longevity and quality of life, it does not save societal resources in the long run (Shenkin H. West J Med 2001;714:85). Even if prevention costs less per person than acute care, its cost per unit of health benefit can be as great or greater (Russell R. Health Policy 1984;4:85-100).

Government Efficiency Myth

The savings from eliminating private insurance overhead and profits, and from allegedly superior government efficiency is said to be sufficient to provide high-quality, comprehensive care to all ignoring the long history of corruption in programs such as Medicaid. According to Christopher Rowland of the Boston Globe, Medicaid officials used $55 million in Medicaid funds to replace defective granite siding on a medical school building. According to the Office of Inspector General for the U.S. Dept. of HHS, Massachusetts Medicaid improperly billed the federal government for $86.6 million in just 2 years. It also paid more than $1 million between 1998 and 2001 to deceased patients whose death certificates were on file.

Government programs do little or nothing about the hemorrhage of funds due to use of fraudulent or stolen Social Security numbers, services to illegal aliens miscoded to obtain payment for noncovered items, or improper payments to politically favored programs such as school-based clinics.

As nonremunerative Medicaid fees to private facilities have driven them out, patients are forced into public clinics, which must by law be reimbursed according to their costs and which do as they please, and to mid-level providers and EDs.

Earmarks, as for "research that never ends," divert millions to "case management," "culturally competent care," and other projects of special interest groups, such as those that must by law be included on the advisory committee to the Massachusetts health care quality and cost council (list available on www.forhealthfreedom.org ).

Health Care uber Alles

The mandatory-insurance siphon doesn't just suck funds from the medical economy. Health insurance comes before food, transportation, and shelter, by Massachusetts law. Paraphrasing Lord Keynes, Gorman notes that "in the long run, enterprising Massachusetts businesses are all dead."

The Only Way Out

Gas lines came to an end only when price controls were lifted. But energy supplies, like medical resources and the economy as a whole, are still crippled by massive taxation, regulation, and litigation. The siphoning solution of legal plunder must be halted, and the economy must be freed, or a sudden, catastrophic decline could result in medicine and other areas. Banging on the pipes, as the AMA repeatedly does with Medicare fee cuts, won't help when the fuel runs out.

Energy, the Economy, War and Health

Some say that World War III has already started. The U.S. faces increasingly deadly threats from the Muslim Middle East, Communist Venezuela, possibly Russia, and others. Our enemies are buying weapons and recruiting terrorists with American money acquired by selling us energy. Moreover, high energy costs imperil American prosperity.

The U.S. has substantial untapped reserves of oil and an essentially unlimited supply of coal and natural gas, both of which can be converted into oil. Nuclear energy could supply most of our electricity. But domestic production and refining of hydrocarbons has been despoiled, and the nuclear industry ravaged under the banner of environmental health.

War and the impoverishment of America are the most serious health threats in our future. Costly false "insurance" against minor risks; tax subsidies that siphon wealth from productive into politically correct channels; and taxation, regulation, and litigation are sapping our strength and our resistance not just in medicine but throughout the economy. The blind pursuit of "health" in the broad sense and of relief from risk and individual responsibility could destroy American medicine and America as a free nation.

Access to medical care not "coverage" by insurance is the real issue. It is a subset of access to other necessities of life, which ultimately depends on free enterprise. (See "Health Technology," "Solar Poverty," "Energy and War," "Economic War," and other articles in Access to Energy, especially March, May, June, July 2006, for key facts and analysis on critical current issues not available in the popular or medical press, PO Box 1250, Cave Junction, OR 97523, $35/yr, $3/issue.)


The Empty Entitlement Pipeline

"Your Social Security Statement," which contains an estimate of the prospective beneficiary's monthly future benefit, states on p. 1 that "by 2040,...there will be enough money to pay only about 74 cents for each dollar of scheduled benefits."

The federal government has a contractual obligation to the holders of its T-bills; a default on interest would be a form of national bankruptcy. It has no such obligation to those with entitlements, according to the landmark 1960 U.S. Supreme Court decision in Flemming v. Nestor.

"Today's Congress can promise future retirees a lifetime golf pass and a free trip to the moon, but it can't bind a future Congress" (Wall St J 8/22/06): note the new Part B surtax.

People can drop Part B. Joel Lehrer, M.D., of Teaneck, NJ, suggests that a private market might eventually arise.


AAPS Counters Citizens Working Group

The Interim Recommendations of the Citizens Health Care Working Group (AAPS News, July 2006) "were arrived at through a `consensus' process involving a select few, apparently structured so as to lead to the endorsement of predetermined conclusions," writes AAPS. "We reject a system of top-down command and control that is implied by a `core benefit package,' enforced use of `evidence-based best practices,' coerced use of electronic medical records, and `pay for performance.'" AAPS also submitted the "White Paper on Medical Financing," published in fall issue of our journal, as an outline for free- market reform. Comments from organizations and individuals are posted at www.citizenshealthcare.gov .


Conflicts of Interest

Organized medicine has generally been reluctant to criticize managed care, or to warn physicians about bad contracts. Antitrust concerns are the usual pretext; the reason may have more to do with its leaders.

The current speaker of the AMA House of Delegates, Dr. Nancy H. Nielsen, has just been named chief medical officer of Independent Health, an Amherst-based health plan, according to a tiny article in the business section of a local newspaper. She formerly served as associate medical director for quality and was named interim medical officer in 2004. She is also senior associate dean at the University of Buffalo School of Medicine (Buffalo News 7/30/06). Her promotion comes at a time when HMOs are seeking physician support for P4P and EMRs, notes AAPS past president Lawrence Huntoon, M.D.

On the local level, the 2005/2006 president of the Erie County (NY) Medical Society, Dr. Richard P. Vienne, Jr., was and is medical director of Univera Health Care, an HMO.

The new president of the Texas Academy of Family Physicians (TAFP), Doug Curran, M.D., regularly appears in full-page glossy ads for BlueCross BlueShield of Texas. He is quoted as saying that he is glad when a patient has a BCBS card because "this is a company I can work with!" No other physicians in Texas can work with BCBS, reports Shirley Pigott, M.D.: its policy on contracts is "take it or leave it."

TAFP has a conflict-of-interest policy. However, Dr. Pigott was told that Dr. Curran is not in violation because the executive committee knows about and fully supports his position with BCBS. Dr. Pigott demanded an investigation. Officials agreed to meet with her but have postponed the time until all 2006 business is completed.

The TAFP Commission on Health Care Services and Managed Care, which is appointed by Dr. Curran, recently squashed all of Dr. Pigott's private-sector resolutions, although all had previously received a favorable vote when the Commission was "blitzkrieged" with them. The chairman has, on the record, refused to hear or discuss a resolution about the relationship between primary care and subspecialist physicians.


On British P4P

Doctors get no rewards for patient satisfaction in the NHS version of P4P. According to Martin Roland, advisor to the U.K. P4P program, the reason is that the British Medical Association "thought that the notion that physicians were essentially running a service industry where the customers' views mattered, would be quite hard for the doctors to adjust to" (Galen Institute, Health Policy Matters 9/8/06).


AAPS Calendar

Oct 6, 2006. Dinner and presentation by Andrew Schlafly, Rockford, IL: call Dr. Mark Kellen, (815) 971-7100.

Oct 10-13, 2007. 64th annual meeting, Cherry Hill, NJ.

Prosecutions of Pain Physicians

Hurwitz Conviction Overturned. In a stunning defeat to federal prosecutors, the Fourth Circuit Court of Appeals vacated the conviction of Dr. William Hurwitz and remanded the case for a new trial (News of the Day 8/24/06).

"Good faith was at the heart of Hurwitz's defense," the Court held. By affirmatively instructing the jury that good faith was not relevant to the drug charges, but only to the fraud charges, "the district court effectively deprived the jury of the opportunity to consider Hurwitz's defense."

The majority, however, rejected the instructions proposed by Dr. Hurwitz, which defined "good faith" to mean "good intentions in the honest exercise of best professional judgment as to a patient's needs" and that "the doctor acted according to what he believed to be proper medical practice." Two judges held that an objective standard should be applied:

To permit a practitioner to substitute his or her own views of what is good medical practice for standards generally recognized and accepted in the United States would be to weaken the enforcement of our drug laws in a critical area. Vamos, 797 F.2d.

Judge Widener, concurring and dissenting, wrote: "I do not believe good faith should be objective; the two terms are contradictory, it seems to me."

Rottschaefer Petitions for Writ of Certiorari. Denied a new trial by the Third Circuit, Bernard Rottschaefer, M.D., (see J Am Phys Surg 2005;10:66 and News of the Day 1/26/06) is petitioning the U.S. Supreme Court. A family physician who occasionally treated pain, Dr. Rottschaefer faces 78 months at an above-maximum security level in prison for offenses charged under the Controlled Substances Act (CSA).

Key issues addressed in the AAPS amicus brief authored by Andrew Schlafly are federalism, the inappropriate use of a civil standard in a criminal case, and perjury.

By "indicting a physician for practicing medicine in a manner of which the federal prosecutor disapproved," a single executive officer turned the state medical board into a nullity. This "disrupted the delicate federal-state balance by supplanting the regulatory scheme of a state with an uninformed federal jury's view of the proper standard of care."

Because there is a "bona fide dispute in the medical community" about Dr. Rottschaefer's prescriptions, "then reasonable doubt about criminal intent exists as a matter of law," Schlafly argues.

To obtain a conviction, the prosecutor presented a "spiced- up tale of sex for drugs" which was a complete lie. Despite proof of perjury by the star witness that came to light after the trial, the Third Circuit ruled that the evidence was "cumulative," and that a new trial was not warranted.

The burden of proof, Schlafly contends, cannot be properly shifted to the accused; he should not have to convince the court that he would not have been convicted in the absence of the perjured testimony.

Because of the current lack of a consistent standard, "perjury runs amok," Schlafly writes. "The judicial permissiveness toward prosecutorial perjury stands in stark contrast to the exclusionary rule, which flatly prohibits the use at trial of much evidence improperly seized."

The DEA, Dr. Rottschaefer observes, is attempting to deny that physicians who provide needed pain relief are being inappropriately targeted. On its website, the DEA states that it is impossible to provide definitive guidelines on the meaning of "legitimate medical purpose in the usual course of professional practice." That is why, Dr. Rottschaefer believes, prosecutions almost universally involve an additional alleged crime such as inappropriate sexual contact, or fraud involving such minuscule amounts of money that it almost certainly represents clerical error. It is the other alleged crime that creates the CSA violation, even if the doctor is acquitted of the other charges as happened in Dr. Hurwitz's case.


DEA Liberalizes Prescribing Rule

The DEA has proposed a rule allowing physicians to write three prescriptions for a 30-day supply of controlled drugs, dated to be filled 30 days apart, at a single office visit. This overturns a two-year-old policy that was forcing chronic pain patients to make office monthly visits just to keep doctors out of trouble with the DEA. The agency had received more than 600 comments on its policies on opioids, many strongly opposing its position on limiting refills (Wash Post 9/7/06).

The DEA has begun posting information on doctors it has prosecuted at www.dea.gov, hoping doctors will be convinced that only "egregious" offenders are indicted.


Alberta Sued for Ban on Private Insurance

The Supreme Court of Canada having overturned Quebec's ban on private insurance in Chaoulli, debate rages on whether such bans violate the Canadian Charter. The question may be answered by a class action suit challenging Alberta's law.

Last year, Premier Ralph Klein's government contemplated allowing private insurance, but backed away from the proposal.

"If these court cases go ahead and are successful it will be the ruin of medicare as we know it," said Ray Martin, health critic of the New Democrat opposition party (NDP).

The case was launched by the Canadian Constitution Federation and Calgary patient Bill Murray, who bought two private surgeries after the government denied him state-of-the- art hip replacements (Calgary Herald 9/8/06).


AHIC Elevates Status of Privacy Panel

In the wake of the AAPS lawsuit challenging the American Health Information Community (AHIC) for failure to comply with the Federal Advisory Committee Act (FACA), a privacy panel has been declared a fifth work group. AAPS had complained that no privacy expert had been designated.

The HIPAA Privacy Rule will probably be discussed, stated panel member Jodi Daniel, who helped draft the first versions as an HHS staffer in the Clinton Administration.

At least two members have spoken in favor of allowing federal rules to preempt state privacy protection, and at least one favors creating a unique patient identifier. This was called for in the 1996 HIPAA law but stalled through the efforts of Congressman Ron Paul, M.D., (R-TX) and privacy advocates. Panel members are listed at www.modernhealthcare.com .

Other events that followed the lawsuit included the abrupt resignation of David Brailer as health IT czar, and a change in AHIC procedures and ambitions.

Documents pertaining to the lawsuit, AAPS v. HHS, are posted at www.aapsonline.org/judicial/ahic.php. Litigation is being supported by the American Health Legal Foundation (see AAPS News, April 2006).


Is the End Nearing? The government has already shifted the burden of paying for Medicare to the children of this country (even as politicians talk constantly about the plight of "the children"). And now it is shifting some of the costs into the next fiscal year. It is simply not paying hospitals or doctors from Sept 22 until Sept 30 with no interest or penalties. The government's resort to such accounting tactics indicates that its financial stress is significant. As I recall, prior to the fall of the Soviet Union, workers were subjected to delays in government payments, and ultimately, no payment.
Lawrence R. Huntoon, M.D., Ph.D., Lake View, NY


A Solution that Works. In five and a half years, my third-party-free practice in a rural county of 65,000 has grown to 7,000 patients. Of these, 4,000 have been uninsured and could have chosen instead to receive care at one of the four state- subsidized clinics located within 15 miles of my office.

Eliminating the tax exemption for health insurance would cut the Gordian knot that has attached health insurance to employers since World War II. This would liberate us from the oppressive system of third-party payment for routine medical care. As Ronald Reagan said, "Solutions are never easy. Just simple." He ignored the contrived convolutions of policy elites and cut straight to the core of seemingly intractable problems.
Robert S. Berry, M.D., Greeneville, TN


The Real Answer to Price Transparency. The recent lemming-like rush to force pricing "transparency" on hospitals to help achieve competition would strike me as dangerous even if Senator Hillary "Health Care" Clinton hadn't jumped on the bandwagon. Inviting government to pass judgment on what is or is not "transparent" is an invitation to impose price controls and business practice controls. A better approach would be to challenge government, the real cause of the hospital pricing problem, to publicize its Medicare pricing, including the codes. Consumers would then have a known price to begin with when the hospital asks them to pay an outlandish amount.
Linda Gorman, Independence Institute, Golden, CO


Squelching Competition. The enormous barriers to market entry have created a very noncompetitive insurance industry. That was the intention of the regulators. They wanted small- group reform to "stabilize" the industry not to lower prices or increase the number of insured persons. Regulators, such as one who started out with Blue Cross/Blue Shield, wanted to have just a few carriers so that employers wouldn't be "confused" by having too many choices. They succeeded.
Greg Scandlen, Consumers for Health Care Choices


HSAs Give Options. A widow with three children, who runs her own business in Fairfax, VA, found that she could get a $3,500 deductible health plan for $4,200 compared to the $10,800 she paid in premiums for a PPO with a $2,000 deductible in 2004. Each month, she pays $350 into her HSA plus $350 in premiums. The total is less than before, and half the money is hers. She also has the flexibility to decrease her HSA contribution during times when business is slow.
Ernest J. White, Alexandria, VA


Nihil Novi Sub Sole. The list of proposals by German socialist physician E. Simmel in 1928 (see Racial Hygiene: Medicine Under the Nazis by Robert Proctor, p 260) to me sounds almost identical to the curent postulates of the AMA and the ACP: (1) Expand coverage of state-sponsored health insurance to the entire population; (2) eliminate all institutions that can make a profit from any form of medical treatment; and (3) make pharmacists employees of the state. Some people never learn.
Walter Borg, M.D., New Iberia, LA


Non-Single Payer. One Big Lie of the Left is that the U.S. is an "aberration" for expecting people to pay something for medical care, and that in all civilized countries, free universal health care is a right. Germany has dozens of sickness funds, and one-third of the population is eligible to opt out of them (of whom one-third do so). France and Germany have coinsurance. Single-payer advocates who refer approvingly to European systems other than the NHS generally don't understand how they work nor do they read accounts of their failures, which are generally not printed in English.
Sean Parnell, Heartland Institute, Chicago, IL


Perpetuating Poverty. Any time you institutionalize the fact of being "poor," you create a "safety" net from which it is very hard to escape. Volunteers provide the right help at the right time, and are happy when they are no longer needed. Government workers need to have people stay poor, in order to justify their own jobs.
Alieta Eck, M.D., Somerset, NJ


MinuteClinics. Competition from walk-in clinics in retailers such as Wal-Mart and CVS is pushing physicians' offices to become more responsive to patients' needs, as by offering speedier appointments. The American Academy of Family Physicians is spending $8 million on consultants to advise doctors on how to improve patient care. The AMA prefers the competition-ectomy, recommending at its annual meeting that such clinics accept restrictions on their scope of operations and require physician oversight.
Jeffrey Singer, M.D., Phoenix, AZ