Health Reform: Freedom and Responsibility for Physicians

Harold S. Luft, Ph.D, of the Palo alto Medical Foundation Research Institute and the University of California, San Francisco (Luft:) recently published a New England Journal of Medicine paper, "Health Care Reform - Toward More Freedom, and Responsibiity, for Physicians" (N Engl M Med 361;6 NEJM Org 8/6/09). His  concept of "more freedom and responsibility" particularly resonated with me, because it is consistent with research which I performed as a Fellow of the Health Research Council of the City of New York in the 1960s (HRC) ), which demonstrated that health care organizations under physician leadership and professional control provided patient care far more effectively and efficiently than non-physician led organizations.  My years of practice and organizational responsibilities in a large physician practice (San Jose Medical Group), as hospital chief of staff, as a member and officer of the board of trustees of a large health system, and as a director of the California Hospital Association, confirmed my academic conclusions: physicians must have the freedom (a right) to practice medicine, the responsibilities (obligations) consistent  with a highly professional exercise of those responsibilities, and  must organize themselves (with adequate capitalization) to accomplish the goal of appropriate patient care in the public interest.

 Luft is pessimistic: he doubts the ability of government to slow health care cost growth. He views insurers' (including a public system) tools for health care cost control to be only two: financial disincentives for patients and fee reductions for providers, neither of which have reduced historic health care inflation. He proposes a two-prong system consisting of  universal coverage for high cost services (the 60% solution - my term, not his) , such as hospital care and ongoing care for chronic illness, and a reorganized ambulatory care (the 40% solution) system. Hospitals and their physician systems would receive bundled payments to be allocated internally under each system's unique internal arrangements under the 60% solution. Ambulatory physicians and groups would receive payment at usual and customary rates. Luft proposes measures to avoid conflicts of interest, a highly sophisticated care and outcome information system and other strategies to encourage high quality outcome achieval with high level efficiency. His focus is on rational incentives for patients, physicians, other providers and institutions.

Patients, in ambulatory care, would chose programs meeting their own health care needs, financial capacities and philosophies. Credit-card type fee payment, from the program level chosen by the patients, would be processed just like any commercially existing credit card (drawing down the program pool left for use by the patient), eliminating ravenous administrative overhead. If patients wanted more care, they would  buy a plan offering more; if they felt they could get by with less extensive and expensive ambulatory care, they would save money through Luft's structure.  If they become very ill, requiring hospitalization or ongoing chronic care, they would be covered through the 60% solution pool.

Luft's paper deserves to be read and widely discussed. Whether his rational and sensible approach can be implemented in an environment of  inflammatory politics, economic uncertainty, greed, ego-involvement and scant attention to serious ethical issues, is something for each reader to consider. Check with your local medical library for the New England Journal's August 6 edition, pp. 623-28.

9/1/2009 - Link to cited article: Link to article: http://ihps.medschool.ucsf.edu/News/news/luftnejm.pdf

Inflation Is In The Eye Of The Beholder

On Agust 24, 2009, the LA Times carried an AP report that Social Security payments (LA Times)  for 2010 (and maybe 2011)  won't be increased because there is no inflation, leading to a decrease in net Social Security checks because the drug benefit premiums will rise.  Sounds reasonable: no inflation, no COLA, no increase in those monthly deposits to Social Security beneficiaries.

But wait - There's more! See what the U.S. Department of Health and Human Services has to say about inflation , when it comes to the government's ability to "charge" for inflation.

"HHS Issues Rules Adjusting Penalties under the Patient Safety and Quality Improvement Rule for Inflation (Penalty Inflation)


"As required by the Federal Civil Penalties Inflation Adjustment Act of 1990 (Inflation Adjustment Act), the U.S. Department of Health and Human Services (HHS) issued both a direct final rule and a proposed rule today adjusting for inflation the maximum civil money penalty amount for violations of the confidentiality provisions of the Patient Safety and Quality Improvement Act. These confidentiality provisions are enforced by the Office for Civil Rights (OCR).

"The Inflation Adjustment Act requires HHS to adjust for inflation the Patient Safety Act’s civil money penalty amount at least once every four years, beginning from the Patient Safety Act’s date of enactment, which was July 29, 2005. These rules adjust the maximum civil money penalty amount for a violation of the confidentiality provisions of the Patient Safety and Quality Improvement Act from $10,000 to $11,000.

"The public has 30 days to comment on these rules. If no adverse comments are received, the direct final rule will go into effect 90 days after publication, and the proposed rule with be withdrawn. If, however, adverse comments are received during the comment period, the direct final rule will be withdrawn. For more information, visit the OCR web site at http://www.hhs.gov/ocr/privacy/."

While there may be a perfectly sensible reason for the penalty inflation adjustment (such as a catch-up to the time that there was inflation 4 years ago), it seems incongruous to deny Social Security beneficiaries a COLA while now imposing a COLA equivalent on government-levied penalties.

H1N1 Influenza - Conflicting Concerns Unclear Plans

Ten days ago, I spent several hours at an excellent Santa Clara County Public Health Department Emergency Medical Services for Medical Volunteers for Disaster Response. I won't tell you about my snazzy new federally-compliant government identification card or about the uniforms we're going to get. What I will tell you is the tone of concern that permeated the discussion of the Swine Flu pandemic. We were told that medical personnel who actually take care of patients will be high priority recipients of the H1N1 vaccine (two injections to a series - approximately 5 weeks to full immunity). Pregnant women, school children, and young people up to age 24 (perhaps to age 30) will also lead the list of those targeted for the vaccine series, along with migrant workers.  Significant plans for non-hospital care of influenza patients in staffed centers for those who are sick (but not critical) are in the works, where they will be able to receive hydration and respiratory therapy.  I asked whether the Medical Volunteers would receive the vaccine, since we would potentially be the staff for the centers and would need two injections and five weeks to build protective immunity, but was informed that no decision had yet been reached on that issue. We talked about Tamiflu and learned that when the commercial doses run out, there will be reserves of public health reserves to draw upon (but asked my self whether the influenza will be Tamiflu resistant by that time). The public will be advised not to go to their physicians' offices or hospital emergency departments for routine influenza care, but to be in contact with health care providers for illness that has life-threatening characteristics (high fever, dehydration, severe shortness of breath).

Incidentally the H1N1 vaccine, in my county, will be made available to the usual medical provider sources, but public announcements of vaccine availability and administration will be limited.

To my surprise, Thomas Frieden, head of the CDC provided a more reassuring picture concerning the severity of the expected US epidemic in an interview today (CDC-Frieden: or Click on Title Above for Linkage).

My suggestion to high risk people is that they contact their health care providers about the availability of the H1N1 vaccine from them.  While children in schools, young adults in colleges, and pregnant females are likely to have ready access to the vaccine, I don't know what the picture will be for those now healthy age 30 - 65 individuals.  When plans solidify, I will pass the information on to you

New HHS Rule

HHS Issues Rule Requiring Individuals Be Notified of Breaches of Their Health Information

August 19, 2009

As required by the Health Information Technology for Economic and Clinical Health (HITECH) Act passed as part of American Recovery and Reinvestment Act of 2009 (ARRA), the U.S. Department of Health and Human Services (HHS) issued “breach notification” regulations today requiring health care providers and other HIPAA covered entities to notify affected individuals following a breach of unsecured protected health information.

The regulations require covered entities to promptly notify affected individuals, the Secretary of HHS, and in some cases, the media, of a breach. Smaller breaches may be reported to the Secretary on an annual basis. The regulations also require business associates of covered entities to notify the covered entity of breaches at or by the business associate. The regulations were developed after considering public comment received in response to an April 2009 request for information and after close consultation with the Federal Trade Commission (FTC), which has issued companion breach notification regulations that apply to vendors of personal health records and certain others not covered by HIPAA.

To determine when information is “unsecured” and notification is required by the HHS and FTC rules, HHS is also issuing in the same document as the regulation an update to its guidance specifying encryption and destruction as the technologies and methodologies that render protected health information unusable, unreadable, or indecipherable to unauthorized individuals. Entities subject to the HHS and FTC regulations that secure health information as specified by the guidance through encryption or destruction are relieved from having to notify in the event of a breach of such information. This guidance will be updated annually.

The HHS interim final regulations are effective 30 days after publication in the Federal Register and include a 60-day public comment period. For more information, visit the OCR web site.


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They Are Not Wishing You Well

In the world of politics, as in the Mideast, nothing is what it seems. The best example is the rejection of a federal health system and the support for a system of health cooperatives by some denizens of the depths of Washington politics.

I estimate that a federal health system option would be a rousing success, putting pressure on health insurers, hospitals, health systems and others to rein-in excessive costs and to focus resources on the people who really count - patients. Health cooperatives, in limited areas, have demonstrated that they can do a good job. But in dealing with nationwide insurers, nationally organized health care providers, national or statewide health care and hospital systems, and other vendors of care, the cooperative model holds no promise of success and will represent, what insurers, hospital systems, health systems and others described above want - an impotent isolated series of cooperatives, which hold no competitive threat, or fail miserably.

Alternatively, the health cooperative system might allow health care redlining which results in areas with adverse health statistics to be abandoned by health insurers with the patients shunted to health cooperatives which cannot afford the sudden mass of very sick people shifted to their rolls. If insurers are forbidden to underwrite, that will not prevent them from choosing not to do business in a particular area or with a particular employer or group of employers.

The call for the cooperatives in Congress is not a call for cooperatives to succeed, it is means of torpedoing a federal health system option. It is a means for insurers to remain insulated from real competition, to allow health care systems to roll merrily on building grandiose suburban facilities as monuments to their executives and donors, to allow certain physicians to order unnecessary tests and provide unnecessary procedures, to cause health care costs to inflate, and to otherwise generate the fiction that these Congressional spokespersons, lobbyists and other interests have the public's good at heart, when that is not the case. They have their own campaign funds and political supporters interests at heart. After all, they get their care through the federal employee system and that's just not good enough for the rest of America.

FDA - Investigational Drug Rules Updated

The American Society of Hematology has notified me that the FDA's Dr. Richard Pazdur has issued a statement concerning "Expanded Access to Investigational Drugs for Treatment Use" and "Charging for Investigational Drugs." These are two significant new rules.

Links follow (for cut and paste use).

http://edocket.access.gpo.gov/2009/pdf/E9-19004.pdf and
http://edocket.access.gpo.gov/2009/pdf/E9-19005.pdf.

Touch Those Out Of Touch

As a board certified hematologist, my career often involved caring for patients whom I knew were soon going to die. Some of these patients were pregnant and in their twenties, many were middle-aged men and women, and some were older folks. They were professionals, religious leaders, politicians, business people, and workers and they represented all religions and all walks of life. Talking with patients about their prognoses was painful for me, as a doctor, and of course difficult for my patients. But even more difficult was imminent death in someone who had not considered or planned for that eventuality and who was surrounded by a family which was unprepared for, and often unwilling to accept, the possibility of a loved-one's death.

I serve on a multidisciplinary biomedical ethics committee which acts as a consultant to hospital medical staff members, patients, their families and others, often in matters of life and death. Our committee makes non-binding recommendations to patients and, more often, their families which affect life, death, quality of life, living arrangements, touch on religious preferences, and sometimes involve the appropriateness of proposed or rejected medical treatment. Although we are experienced and professional, it is sad to have us - as strangers to affected patients and their families - suggest resolution of situations which should have been resolved by those most involved - primarily patients, and when appropriate, their families.

My understanding is that payment by the federal government for end-of-life planning counseling services has been dropped, at the urging of a small group of Senators and politically-connected pressure groups. These services can provide peace of mind to those who are not yet patients, patients and patients' families, as well as practical solutions to individual problems. Planning is best done by the person whose life experiences give him or her the right to make his or her own life and death decisions.

I suggest that my readers contact the organizations listed below to express their wishes and expectations concerning this issue. Send your own message or forward this blog. But don't stand by silent, because when the time comes, no one may speak for you and you might not have your own plan.

Republican National Committee - - - www.gop.com
Republican Congressional Committee - www.nrcc.org
Republican Senatorial Committee - - - www.nrsc.org
Democratic National Committee - - - www.democrats.org
Democratic Congressional Committee - - - www.dccc.org
Democratic Senatorial Campaign Committee - - - www.dscc.org/home

Health Insurers' Wish Lists

Like children, hoping for a rewarding visit from Santa Claus in December, Health Insurers have their own wishes, waiting to be granted. While kids want Santa to come with a full sack of goodies, the insurers might want (and have already negotiated for) an empty sack from Congress and President Obama. Read on -

1. No weakening of anti-trust protection of insurers for the their activities constituting the "business of insurance."

2. No meddling by the federal government in the salaries and bonuses of health insurance company executives and their key staff.

3. No action by the federal government which might draw major employers away from traditional health care insurers to an insurance pool or public plan.

4. No interference by the federal government with health insurers' drug distributing subsidiaries ability to extract rebates, discounts and other incentives from pharmaceutical companies, as well as providers of other health care goods and services, and not pass them on to patients and employers.

5. No entry by the federal government into administration of health plan enrollments and premium collection and distribution which would cut into health insurers' profitable administrative overhead revenues.

6. No extension of federal fraud and abuse laws to the products, services and arrangements provided by insurers, their subsidiaries and contracting parties.

7. No national standard uniform contract for health care insurers with patients, employers and other similarly interested parties.

8. No single payer system.

9. No federal requirement of freedom of access by all health insurers to all physicians, nurses, hospitals and other organization which provide health care services (see #11).

11. No American standard of enforceable performance by health insurers for the services and products they sell to employers and patients, and no weakening of the ERISA protection of insurers against private lawsuits by injured patients and their families.

12. No restriction on the ability of health care insurers to purchase networks of providers and facilities who will then provide services only to each owner-insurers' clientele.

13. No unionization of health care professionals, such as physicians.

14. No interference with the system by which 50 states regulate insurers.

15. No restriction on commercial "free speech" by health insurers.

10. (Inadvert. omitted - added 8/17/09) - No requirement that the insurance companies be required to provide high-technology prostheses.

It Wasn't The Government Saying Goodbye Too Soon

I recall one of our Thursday lunches, to which the physician organizer invited representatives of a local hospice to talk about hospices and specifically about their hospice's services to patients and their families. It was an informative interesting talk, enlivened by a lot of questions from doctors. But the really interesting conversation came after the hospice people left.

Several cancer specialists angrily complained about a local hospital. These physicians found that immediately upon a patient's diagnosis of cancer, someone in the hospital (perhaps social services?) arranged for a prompt hospice consult before a cancer specialist could review the case with the patient, his or her family, the patient's primary physician, pathologists, radiologists, and other experts. Patients and their families were having "the crepe" hung for them, with the gloomiest possible prognosis. The cancer specialists said that patients were being whisked out of the hospital, consigned to hospice care, when they could have been treated palliatively (even during hospice care), to relieve pain and suffering and perhaps to prolong life, or could have explored the possibility of an effort at curative treatment.

Now, this wasn't the government convening a "let's shorten your life" committee. The physicians felt this was an apparent hospital policy.

Before we again shake our fingers at Senators and Representatives, and accuse our government of rushing people off to die to save money, let's think about other actors: insurers, hospitals and institutions which - if there are no ethical safeguards - could be advantaged by hastening the process of dying.

America's Paradox

In the days of my medical practice, I would find people in my office who had been through one romantic relationship after the other, all ending unsatisfactorily. These patients eventually recognized that they had developed relationships again and again with partners who were virtually identical in terms of looks, behavior, abusiveness, handling of money and unfulfilled promises to do better. They were with virtually the same person over and over, with the same unsatisfactory result, and rarely learned from their experiences.

For years, Americans have had relationships with insurers who act like my patients' lovers. The insurers promise a new world of health care in slick brochures, television commercials and sales presentations, provide no real health services themselves, engage in abusive business practices - such as policy cancellation or denial of services, tests, and prescription - to patients who need care, pocket large portions of the premium money entrusted to them for inflated administrative overhead, and then promise to reform. But never do . . . .

And yet, the insurers demand that we love them. Should we? Don't we ever learn?

Physicians - Info About Rules & Your 2010 Medicare Fee Schedule

Individual physicians have traditionally been shy about responding to rule proposals by Medicare (CMS - The Centers for Medicare and Medicaid Services). So if you are a physician or medical group administrator, you might read this document (click title above for direct link to a large file) so that you can add your (or the organization or institution you represent) input to the decision makers (including Congress people) who are planning to reduce Medicare physician payments by about 21.5%. If you don't care, don't bother, but then don't complain at the lunch table in the doctors' lounge when you get slammed next year.

Below is a brief extract from the large document (click title for direct link).

"SUMMARY: This proposed rule would address proposed changes to Medicare Part B payment policy. We are proposing these changes to ensure that our payment systems are updated to reflect changes in medical practice and the relative value of services. This proposed rule discusses: Refinements to resource-based work, practice expense and malpractice relative value units (RVUs); geographic practice cost indices
(GPCIs); telehealth services; several coding issues; physician fee schedule update for CY 2010; payment for covered part B outpatient drugs and biologicals; the competitive acquisition program (CAP); payment for renal dialysis services; the chiropractic services demonstration; comprehensive outpatient rehabilitation facilities; physician self-referral; the ambulance fee schedule; the clinical laboratory fee schedule; durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS); and certain provisions of the Medicare Improvements for Patients and Providers Act of 2008. (See the Table of contents for a listing of the specific issues.)"

If Ronald Reagan's Health Coverage Was Cancelled

The story was told to me in the mid-90s with great enthusiasm, by a former executive of a major California-based health insurance company. It seems that a major California health insurer, which had enrolled State of California employees for many years, did a study to find out why writing health insurance for this group was becoming less profitable, and learned that it was experiencing adverse selection: all of the State of California employees who had selected the program were over age 40; the younger employees joined Kaiser which had much lower premiums.

So the insurer did just what insurers still do to employers. It notified California that it was no longer interested in the state's business, and that upon the termination of the contract, it would no longer provide coverage for state employees. The insurer "fired" the State of California.

Though I don't remember the name of the man who told me the story, I remember his grin and the twinkle in his eyes, when he related that among those who lost his coverage was then governor, and soon to be President, Ronald Reagan. The person who told the story said that when the insurer discovered its politically disastrous mistake, it withdrew its health insurance termination decision so that, once again, Ronald Reagan was insured.

I had no independent verification of the story. But it strikes me as quite consistent with health insurers' behavior. So I thought I'd pass it on. Perhaps one of my readers can give us additional details.

HHS Sec. Delegates Admin. & Enforce. Authority to OCR

Here is the Announcement from OCR concerning HHS delegation of privacy administration and enforcement to the Office of Civil Rights To save time, and get directly to the Federal Register, click the title above.

"Announcement

"Monday, August 3, 2009

"Secretary Delegates HIPAA Security Rule to OCR

"On August 3, 2009 OCR announced that the Secretary of Health and Human Services has delegated to the Director of OCR the authority to administer and enforce the HIPAA Security Rule. This action by Secretary Sebelius will improve HHS’ ability to protect individuals’ health information by combining the authority for administration and enforcement of the Federal standards for health information privacy and security called for in the HIPAA.

The transition of authority for the administration and enforcement of the Security Rule is expected to be seamless with no interruption in the management or processing of any complaints filed prior to the transition. Consumers may continue to submit HIPAA security complaints using the on-line resource – the Administrative Simplification Enforcement Tool (ASET), found at https:htct.hhs.gov/aset. New security complaints may also be sent to the Office for Civil Rights. For more information and detailed instructions on how to submit a complaint to OCR, visit the OCR website: http://www.hhs.gov/ocr/privacy/hipaa/complaints/. The transition of security complaints from CMS to OCR has no impact on how complaints about Transactions and Codes Sets or Unique Identifiers are filed or processed. CMS retains its enforcement authority for these other HIPAA rules.

:View the Federal Register notice of the Delegation of Authority at http://www.hhs.gov/ocr/privacy/srdelegationofauthority2009.pdf and the Secretary’s press release at http://www.hhs.gov/news/press/2009pres/08/20090803a.html."