Category Archives: General Cynicism

This is from an earlier Medicynic (Jan 4, 2009). It’s here because of Reinhardt’s continuing discussion in economix of market based health care.

George Will and Mike Leavitt think buying health care should be like buying a car:

“Leavitt says that until health care recipients of common procedures can get, up front, prices they can understand and compare, there will be little accountability or discipline in the system: “In the auto industry, if the steering-wheel maker charges an exorbitant price, the car company finds a more competitive supplier. In health care, if the medical equipment supplier charges an exorbitant price, none of the other medical participants care.””

Price should be part of the health care equation. The cost of everything should be up front and open to scrutiny. Insurers should bargain for the best deal for their customers. These negotiated prices should be common knowledge so that all needing health care can benefit.

What’s missing from Mr. Will’s analysis is an understanding that patients are not in a position to shop health care. Finding the “best price” for emergency care and most other health care needs is simply not possible and the patient has to take whatever is available from the local supplier at the demanded price. Furthermore, health care is not like other commodities that people can take or leave as they wish. Buying a car or even a new home is an optional expenditure, health care is not. Yet health care costs/year for an individual can now approach and exceed these large expenditures.

Patient’s health care decisions reflect their anxiety, personal bias, financial status and understanding of the situation. This last factor should not be underestimated. Patients in the majority of instances cannot fully understand the risks and/or benefits of treatments and the alternatives, much less concern themselves with cost efficiency data. He/she is thus greatly influenced by physicians, manufacturers, insurers, etc. all with superior knowledge of the situation. All these advisors have extreme conflicts of interest that interfere with unbiased advice and undermine the notion of a “free health care market”–it doesn’t exist.

Our health care market doesn’t encourage efficiency, but rather it promotes over utilization. Providers and suppliers make more when there is consumption of health care services and products. One only has to experience inaccurate and highly deceptive TV ads for pharmaceuticals and procedures to understand that consumption is the name of the game, not cost efficiency.The failure of free market forces in health care is graphically demonstrated in the insurance market. Insurers, in the U.S., spend an estimated 30% of revenue on administrative costs while other industrialized countries manage with between 7 and 15% for administrative costs–that’s over 100 billion dollars wasted. Our expenditures/capita are similarly elevated. Even with these excess expenditures, 50 million of our citizens are uninsured. CEO’s of insurance companies understand they are in business to make money and not deliver and/or pay for quality economical care. Much less provide health care for all.

There is even worse inefficiency in the pharmaceutical industry where products are given generation long monopolies (patents) that eliminate price competition. Companies price drugs based on the severity of the condition rather than their costs of development. They figure more seriously ill people can be coerced into paying more. They have been correct thus far. In the U.S. free markets are interpreted to mean free to make maximum profit.

Nice discussion in Economix by Ewe Reinhardt:

The crucial characteristics of a perfectly competitive market are (1) that all of the quality dimensions of the good or service traded in that market are accurately understood by buyer and seller; (2) that potential buyers have full transparency on the price they will have to pay per unit of that good or service; (3) that it is easy and relatively costless for potential sellers to enter and exit this market; (4) and that there are so many potential buyers and sellers that none individually can affect the market price of the thing being traded.

Read the full article but also look here and then here and here for a medicynical view.

It’s amazing to see misleading and uninformed medical information not only on web sites but from the mouth of what can only be termed an elected ignoramus.

Avastin over time has been shown to be a very expensive placebo ($50,000-100,000/year for the drug alone). It adds little or nothing to other, I might add, much less expensive regimens in breast cancer. A reasonable view is that the FDA erred initially when approving the drug for this indication and it’s good practice to not continue using an expensive useless drug.

Unbelievably David Vitter a Senator from Louisiana recently found cavorting with a prostitute takes issue with the FDA decision. He rejects the negative recommendation as being tantamount to a “death panel.” Not only is Vitter hopelessly ignorant, he is politicizing health care setting a very dangerous precedent that does not bode well for politicians, the drug approval process and seriously ill patients.

Perhaps he is unaware of the waste and expense of our health care non-system. Or that we spend 50% to 100% more than other countries per capita on health care. Or that this drug alone costs more than the average salary in our country. Or that other countries have not allowed the use of Avastin for this purpose because it is ineffective.

Medicynical Note: Our non-system of health keeps taking stranger turns.

Fascinating article regarding Texas’ hypocritical reaction to health care reform.

In a perverse way one must admire the republican/conservative ability to sell positions that are not the consumer’s best interest. Thus they continue to oppose regulation (“set business free”) after ample evidence that business needs it to protect not our only our country’s financial interests but also to keep the industries themselves from imploding. Remember Enron, the S&L crisis, our current financial crisis, and our ongoing BP spill. True you need dedicated competent regulators but the notion we can do without regulation seems a recipe for our certain ruin.

After cutting taxes early in the Bush administration, they lead us into two credit card wars. Our grandchildren will be paying for our adventures in Iraq and Afganistan. This act alone created over a trillion dollars in debt which was further aggravated by the “Bush” tax cuts. Now our republican (and some democratic) friends oppose rescinding the the tax cuts that created much of the debt over which they now obsess–see article. Make sense? No!

In Texas, where the article points out the there are 6.1 million people without health coverage, the republican leadership is moving to challenge and demagogue the constitutionality (with other states attorney generals) of health reform.

Meanwhile the non-system of care in our country slowly implodes. And the jackals of health care feed on its’ carcass by raising prices, and rates and worrying most about their bottom line, not the care of our population. Quite amazing and literally only in America.

Parenthetically at the same time in the state of Texas, bureaucrats, presumably with the blessing of the conservative state government hedge:

“Sometimes it seems a little schizophrenic,” acknowledged State Representative John M. Zerwas, a Republican who favors the law’s repeal but also leads a House committee that seeks to maximize its benefits to Texas. “There are plenty of laws out there that I might not agree with. But if the law of the land says we have to do it, the last thing I want is for Texas to not be prepared or not put things in place to comply.”

It’s sad when people deny 80 years of progress and decide that scientific information does not meet their particular bias. No, I’m not talking about global warming (though I could be) but rather about the efficacy and utility of vaccination. For whatever reason there are groups who believe that these proven public health interventions cause harm. This despite the eradication of smallpox, the near eradication of polio and the marketed decrease in occurrence and fatalities from measles and pertussis and no good evidence that there is harm from vaccination other than transient occasional transient reactions.

Who pay? Their children.

The confirmation of the death — the sixth pertussis-related death this year in the state — comes a day after the California Department of Public Health expanded criteria for those who should be vaccinated against the highly contagious disease amid what is shaping up to be the worst outbreak in 50 years.

“This expanded set of recommendations is an appropriate response to the epidemic in Los Angeles County and statewide,” Dr. Jonathan E. Fielding, the county’s public health director, said in a statement. “Vaccination is our best defense against pertussis. This is a disease that is especially dangerous for infants under six months of age, who are not old enough to have received the number of vaccine doses needed to be protected against whooping cough.”

The utility of the vaccine is not only in preventing the disease in the individual vaccinated but in decreasing the prevalence of the bacterium in our society (herd immunity). With less vaccination babies still receiving the initial protection are more likely to be exposed and develop the disease, as in this case.

There is a correlation between lower vaccination rates and the occurrence of pertussis.

Researchers took a global look at how personal-belief waivers drive whooping cough in a 2006 article in the Journal of the American Medical Association. They found that states – like California – that have easy-to-obtain-vaccine waivers saw a 90 percent higher incidence of whooping cough than other states.

and

Marin has the state’s highest rate of whooping cough infections at 77 cases per 100,000 residents. And its personal-belief exemption rate is also more than twice the state average, with 7 percent of kindergartners showing up to school with no shots.

Medicynical Note: in this case ignorance is not bliss.

Only in America.

A 61-year-old man was jailed Saturday afternoon after he allegedly shot a man who aggressively begged for money outside a McDonald’s in downtown Everett, according to Everett police.

Medicynical Note: Our national obsession. Is this freedom?

America can be presumed the world leader in health care inefficiency simply by the fact that our health care outcomes, while mainly quite good, are not at all better than those attained in the rest of the world, but our costs are 1.5 to 2 times as much.

Why? In other parts of the world insurance coverage is streamlined, fewer more efficient insurers lead to less costly health care. The U.S. for example spends about three times as much as Canada on administrative expenses in our respective health care systems.

A major reason why it is so difficult to reduce costs is that every dollar of health care spending is a dollar of income to someone involved in providing health insurance or health care. Administrative costs are undoubtedly too high, and insurance companies taking excess profits and executives with high salaries are frequently blamed. But they are only a small part of the story. The biggest part consists of payments to tens of thousands of telephone and computer operators, claim payers, insurance salespersons, actuaries, benefit managers, consultants, and other low- and middle-income workers. Overutilization of care is another problem that is not easily solved, partly because unnecessary or marginally useful tests, prescriptions, operations, and visits generate income for providers.

One would think the industry would recognize the unsustainability of the current system and be working to improve efficiency to assure their future. However in America long term sustainability is not a priority or particular virtue compared with short term profit. We are short timers. Gaming the system is the rule if it will yield a few bucks as noted here. To refresh your memory health care reform requires expenditure of at least 80% of premiums on actual health care. A modest requirement given that Medicare spends between 5 and 10% of on administration but:

But state regulators are only now deciding what precisely that means, as they draft the rules to enact the law. WellPoint, which operates Blue Cross plans in more than a dozen states, wants to include the cost of verifying the credentials of doctors in its networks. Insurance companies like Aetna argue that ferreting out fraud by identifying doctors performing unnecessary operations should count the same way as programs that keep people who have diabetes out of emergency rooms.

Some insurers even insist that typical business expenses — like sales commissions for insurance agents and taxes paid on investments — should not be considered part of insurance premiums, which would make it easier for them to meet the 80-cent minimum.

Medicynical note: Gaming the system is the rule in the U.S. whether you are trying to corner the market on energy, mislabeling junk investments as high quality, denying global warming or digging a deep water oil well. It is part of the reason our economy has soured and has few prospects for recovery.