Category Archives: healthcare reform

From Karl Denninger, an article titled Enough of this Nonsense:

I’m talking about the basic economic question: Supply, demand and what happens when you allow someone to force another person to pay your bill.

I keep hammering on this and will until people stop running tropes whether out of sincere (but false) belief or some other reason.

Let’s take Eliquis.  Its a common medication and its expensive.  Roughly 3.5 million Americans take this drug and it is one of the most-commonly prescribed for people who have atrial fibrillation.  It appears to be reasonably effective in reducing the risk of strokes and heart attacks in people with that condition.

It is also about $8,000 a year in the United States without insurance and “insurance” forces those who do not have that condition to pay for those who do — including Medicare and Medicaid.

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The common claim is that “if you cut that off those people will die” because they can’t possibly afford the price.

The claim is false.

In Germany the drug costs about $700 a year, so it is ten times as expensive in the United States.

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Parker here. I know why Eliquis (apixaban) so much more expensive in the U.S. I wrote all about it in my latest book. Read Denninger for his opinion. (He’s smarter than me but was wrong about his predicted 2024 severe economic contraction. Making predictions is hard, especially when it’s about the future.)

Steve Parker, M.D.

Opthalmologist Dr. Will Flannery has put together a whimsical yet accurate guide to the U. S. healthcare system. Well worth your time if you’re relatively new to the system and need help understanding deductibles, co-pays, out-of-pocket maximums (hint: they’re not really maximums), in-network, out-of-network, vertical integration, “surprise” medical bills, etc. I was particularly impressed with the section on fighting claim denials; I hope I remember to re-read it when the time comes.

Dr. Glaucomflecken’s Incredibly Uplifting and Really Fun Guide to American Healthcare.

Remember how Obamacare was supposed to make healthcare more affordable? From the guide, “The 2025 out-of-pocket maximum for an Affordable Care Act plan can’t be more than $9,200 for an individual and $18,400 for a family.” When half of Americans can’t afford an emergency $500 bill, how do they pay up to $9,200?

Dr. Glaucomflecken also offers some system improvements that I also advocate in my latest book, Resuscitating U.S. Healthcare: An Insider’s Manifesto for Reform.

Steve Parker, M.D.

William M. Briggs thinks that “true insurance” is the better idea. He starts with this explanation:

Health Insurance should be, but isn’t, a bet you make that you hope you lose.

It has become instead an inefficient form of socialized medicine, increasing costs. Here’s how.

Here’s what insurance should be. You bet with an Insurer that you get cancer, say. If you get it, the Insurer pays costs of care X. If you lose and remain cancer free, you pay Y. You re-bet every month (or whatever). You pay Y every time you lose. The X and Y are negotiated between you and the Insurer, and the risk of cancer is decided by you and separately by the Insurer. That is the bare bones of true Insurance. Or, indeed, of any bet.

You can also group diseases, say cancer and CHF. Then you pay Y_1 + Y_2 (say) and the costs are X_1 + X_2. The result is a contract bet just the same. But with higher stakes for both.

Suppose you already have cancer and bet the Insurer you won’t get it. You immediately win the bet! The Insurer must pay X.

How much should the Insurer charge you for this sure-thing bet? X. After all, your “pre-existing condition” is a sure-thing bet the Insurer is bound to lose. There is no sense in you making the bet.

Unless a Ruler steps in and says “Insurer, you must take this bet!” Which, of course, happens. Then the Insurer must spread the costs of X to others.

If the Insurer doesn’t spread the costs, he has sure loss (assuming calibrate bets, about which more later). Which means if you bet you have cancer when you do, when your neighbor makes a bet for cancer when he doesn’t have it, he must pay Y+S, where S represents the spread. The more people in the system, the smaller S is.

Voilà! With coverage mandates Insurance automatically becomes socialized medicine. Very inefficient, too, because not only are we paying a private entity to manage this, and take his profits, we pay bureaucrats to monitor it all. Costs must increase. Health care won’t get better, but costs must rise. 

It’s worse than all this, too!

RTWT. I discuss the pros and cons of the “true insurance” idea in my book below. Dramatic price reductions done today.

Steve Parker, M.D.

I’d be much appreciative of some Amazon reviews of my 2024 book, Resuscitating U.S. Healthcare: An Insider’s Manifesto for Reform.

To make the book available to more readers, I just dramatically reduced the price at the U.S. Amazon store. $2.99 for the e-book (Kindle) or $9.95 for the paperback. I don’t know how long the prices will stay this low.

If you’re curious, at those prices Amazon pays me $2.06 for each e-book sold, and $2.74 for the paperback.

I don’t care if you leave a favorable or bad review at Amazon. Just be honest. I’ll incorporate helpful and insightful criticism into the 2nd edition.

Steve Parker, M.D.

I’ve long been an advocate for price transparency in healthcare. The Centers for Medicare and Medicaid Services (aka CMS) has recently taken action that requires hospitals to post their prices online, which should boost competition and help you shop around to save money. If memory serves, the price posting only applies to a limited number of services. I presume the rare hospitals that don’t accept Medicare and Medicaid payments are exempt.

From MedPage Today:

This week [June 2022], CMS handed down their first penalties to two hospitals in Georgia for failing to comply with the price transparency law that went into effect Jan. 1, 2021.

Northside Hospital Atlanta in Sandy Springs and Northside Hospital Cherokee in Canton were both fined for a lack of readily available standard charges for hospital services online, despite warnings.

The fines were on the order of $200,000 and $900,000.

If you find a hospital breaking the law, report ’em to CMS!

Steve Parker, M.D.

PS: Let me help you avoid hospitals.

In your ideal world, would you prefer your physician’s income reflect:

• number of patients seen and procedures performed, or
• high quality of care, reflected in ready accessibility, lowering cost without compromising care, compliance with science-based guidelines, and patient satisfaction/experience, or
• combination of the above

In other words, do you want your physician incentivized by volume or value?

It doesn’t matter what you want anyway, peon.

A recent study looked at salary arrangements for doctors in system-affiliated physician organizations in four states. The main conclusion:

The study results suggest that despite growth in value-based payment arrangements from payers, health systems currently incentivize physicians to maximize volume, thereby maximizing health system revenues.

This in-depth multimodal cross-sectional assessment of compensation and incentives among health system–affiliated POs [physician organizations] for which there is greater exposure to VBP [value-based payment] and APM [alternative payment model] arrangements compared with independent practices found that volume was the most common form of base compensation by a wide margin, being included by more than 80% and 90% of POs for PCPs [primary care physicians] and specialists, respectively, and representing more than two-thirds of compensation when included. Similarly, actions to increase volume were the most commonly cited means for physicians to increase their compensation. Base compensation incentives for physicians were not dominated by population or value-oriented payments, with only a third of POs reporting inclusion of capitation with PCPs and averaging only about a third of total compensation when included. Performance-based financial incentives for value-oriented goals, such as clinical quality, cost, patient experience, and access, were commonly included in compensation but represented a small fraction of total compensation for PCPs and specialists in health systems, operating at the margins to affect physician behavior. Taken together, these findings suggest that despite growth in APMs and VBP arrangements, these value-based incentives were not commonly translated into health system physician compensation, which was dominated by volume-oriented incentives.

The problem is that it’s a lot easier to measure volume than value. Easy wins.

Steve Parker, M.D.

Ref: Physician Compensation Arrangements and Financial Performance Incentives in US Health Systems in JAMA Network

PS: Avoid the medical-industrial complex as much as is safely possible. Let me help.

From an article published March 5, 2020, at The Hill:

March 2020 marks the 10th anniversary of the passage of the Affordable Care Act, also known as ObamaCare. In its first decade, ObamaCare has failed to solve many of the health care problems it was supposed to address. Even worse, it has compounded many of the issues it was meant to fix — the law of unintended consequences in action.

First, then-candidate Barack Obama said his namesake act would “cut the cost of a typical family’s premiums by up to $2,500 a year.”

In reality, the opposite has occurred. According to the Department of Health and Human Services (HHS), “premiums have doubled for individual health insurance plans since 2013, the year before many of Obamacare’s regulations and mandates took effect.”

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Third, President Obama repeatedly assured voters, “If you like your health care plan, you’ll be able to keep your health care plan, period.” After ObamaCare was enacted, millions of Americans were unable to keep their pre-ObamaCare health insurance plan.

Individual market premiums were $2789/year in 2013, compared to $5712/year in 2017.

Obamacare proponents promised that the plan would drastically reduce the number of uninsured folks. Wasn’t it 30 million uninsured? But there are still 28 million uninsured. And it’s probably going to get worse since citizens are no longer forced to buy something they don’t want or can’t afford.

The author of the article is affiliated with The Heartland Institute.

Source: ObamaCare: 10 years of distress and disappointment | TheHill

Steve Parker, M.D.

PS: Avoid the medical-industrial complex by getting and staying as healthy as possible. Let me help.

From UPI Jan. 31, 2020:

Despite spending far more on health care than other wealthy nations, the United States has the lowest life expectancy and the highest suicide rate, new research shows.

For the study, researchers at The Commonwealth Fund compared the United States with 10 other high-income nations in the Organization for Economic Cooperation and Development (OECD)—Australia, Canada, France, Germany, the Netherlands, New Zealand, Norway, Sweden, Switzerland and the United Kingdom—and with the average for all 36 OECD nations.

In 2018, the United States spent almost 17 percent of its gross domestic product (GDP) on healthcare. That’s more than any other high-income country and twice the overall OECD average. For example, New Zealand and Australia spent 9 percent of GDP on healthcare.

U.S. healthcare spending now tops $10,000 per person, and much of it is driven by private insurance costs such as premiums, according to The Commonwealth Fund report published online Jan. 30.

Source: U.S. health stats remain low despite trillions in healthcare spending – UPI.com

The numbers above are outdated. U.S. health care spending grew 4.6 percent in 2018, reaching $3.6 trillion or $11,172 per person.  As a share of the nation’s Gross Domestic Product, health spending accounted for 17.7 percent.

Click to learn what that money is spent on.

Click to learn why U.S. healthcare is so expensive.

Steve Parker, M.D.

PS: Why not try to avoid healthcare spending by getting and staying as healthy as possible? Let me help now. And for less than $20.