Medicynic

Interesting Economix by Uwe Reinhardt on money flow in health care:

He notes:

In fairness, it must be added that traditional Medicare basically sets prices and then just pays bills. It makes no active attempt to manage care (utilization controls, disease management, coordinating care and so on), because it has not been allowed by Congress to do so. It is almost as if Congress did not want traditional Medicare to be a prudent purchaser of heath care for the elderly. (Medicynical emphasis)

From the viewpoint of prudent purchasing, most economists would probably judge these prices too low. On the other hand, the fact that traditional Medicare just pays bills more or less passively may be precisely the reason that it is still so popular among the elderly. Traditional Medicare still offers beneficiaries completely free choice of providers and therapy — a degree of freedom that many younger Americans in insurance plans with limited networks of providers no longer enjoy.

Medicynical Note: Until we approach the issue of value in medicine (What works? Bang for the buck?) we’ll have the most expensive least efficient health care non-system in the world. What’s bugging us, the US, now is how to get to such a system.

Is health care part of the package of being a US citizen? Providing Medicare to the elderly and many with chronic illness implies such a commitment. Does required access to ER care for all, whether they can pay or not, point to a civic responsibility to assure access to care to the rest of the population?

If our republican friends really believe that health care is not a “right” then a large swath of citizenry are going to be in trouble as republicans follow through on this philosophy. Interestingly these rightist purists for some reason tout ER access for all as adequate health care in our non-system. Why they would choose the most expensive, least efficient care in the world as their means of providing health care is unknown.

If there is an explicit right to health care in our country, more efficient ways to provide it must be found. It should assure affordable care to citizens, including the elderly and those with illnesses. One problem has been that private insurers, ironically, want little to do with either of those populations.

A recent Archives of Internal Medicine study of primary care physicians noted:

Forty-two percent of US primary care physicians believe that patients in their own practice are receiving too much care; only 6% said they were receiving too little. The most important factors physicians identified as leading them to practice more aggressively were malpractice concerns (76%), clinical performance measures (52%), and inadequate time to spend with patients (40%). Physicians also believe that financial incentives encourage aggressive practice: 62% said diagnostic testing would be reduced if it did not generate revenue for medical subspecialists (39% for primary care physicians).

It was also noted in a Reuter’s piece about the Archives article that:

Four in 10 also believed that other primary care physicians would order fewer tests if those tests didn’t provide extra income. (Of course, just three percent thought that financial considerations influenced their own practice style.)

“I’m not saying that physicians do tests in order to make money — there is a potential to be a real cynic here — but I think that the reimbursement model for most healthcare encourages utilization in a variety of way,” Sirovich said.

Medicynical Note: It’s not cynical to acknowledge reality.

Back from a wonderful trip to Botswana and Zambia.

I noted a remarkably skewed analysis of the impact of the health care bubble on gains in household income the last ten years in Health Affairs.

They note:

Although a median-income US family of four with employer-based health insurance saw its gross annual income increase from $76,000 in 1999 to $99,000 in 2009 (in current dollars), this gain was largely offset by increased spending to pay for health care. Monthly spending increases occurred in the family’s health insurance premiums (from $490 to $1,115), out-of-pocket health spending (from $135 to $235), and taxes devoted to health care (from $345 to $440). After accounting for price increases in other goods and services, the family had $95 more in monthly income to devote to nonhealth spending in 2009 than in 1999.

The analysis is unrealistic and understates the impact of health inflation by focusing primarily on those with employer based insurance. The population without such insurance has almost certainly lower income and higher insurance costs, if they are covered at all.

More here:

Copays have increased as well, the authors pointed out. In 1999, the average copay for a doctor’s visit was in the range of $5 to $10, but by 2009, it ranged from $20 to $30. Copays for visits to the emergency room were rare in 1999, but a decade later, they cost $100 or more.

In addition, taxes devoted to healthcare — for Medicare, Medicaid, the military health system, and the Department of Veterans Affairs — increased from $345 to $440 from 1999 to 2009, Auerbach and Kellerman wrote. They added that the tax hike is “misleadingly modest” because actual growth in government spending on healthcare was much larger: 140% at the federal level and 76% at the state level. The authors said Bush-era tax cuts caused the government to collect only $6 for every $10 it spent during that 10-year time frame. (medicynical emphasis)

Medicynical note: The median household income in the US is significantly lower than stated in this article which as noted refers to those with employer based health insurance. It approximates $60,000 and has not risen much if at all over the past ten years.

As we’ve emphasized previously health care costs over ten years have inflated by 130%.

It’s amazing how much more we pay for health care than any other place in the world. It’s dubious that this will change dramatically in the near future with both parties in the pay of the medical industrial complex–though I still hold out hope that health reform is a first step toward cost containment.