It’s difficult to understand why (unless, as we highly recommend, you read Dr. Rich’s Covert Rationing Blog), but President Obama and his colleagues clearly wish to eliminate any responsibility that patients might with respect to paying for their own healthcare.  This might be a good idea if the ultimate objective is to maximize both the demand for medical goods and garner votes from the grateful masses, but it’s hardly a recipe for a healthcare system that spends its dollars wisely.  To most people, making things “free” simply removes any need to think about just how much things cost.  When is the last time you thought twice about taking an extra paper napkin at Starbucks, or felt guilty about stuffing yourself at a buffet?

This lesson was driven home to us recently by a conversation with Mr. Robert Sparkes, a retired engineer who was laid off from his job just about two years ago.  In 1984 he was diagnosed with Type II diabetes and has relied on his work-related health insurance to pay for his insulin.  To keep his blood sugar under control throughout the day he uses both Lantus, a long-acting form of insulin, and Humalog, a short-acting insulin.  The cost of both of these drugs in the U.S. is substantial.  In the U.S. both drugs are about $130 per vial, and Mr. Sparkes uses two bottles of each every month.  Glucometer test strips used to check his blood sugars are another big expense.  A box of fifty OneTouch test strips goes for $120, and he uses two boxes per month to keep his sugars under good control.  All told, that’s $700 each month just for the medications and strips Mr. Sparkes uses to manage his diabetes.  That doesn’t include a penny for doctor visits, lab tests, his other various medications or anything else.

That may seem like a lot of money, but Mr. Sparkes never gave it a second thought until last January.  When he was on private insurance all he had to worry about when buying insulin or test strips was a $5-$10 copay for each prescription.  The true cost of the drug was irrelevant.  “You don’t really have to think about it, do you?” he says.  But then his COBRA insurance, the 18 month extension of his employer’s healthcare policy, ran out.  From that moment, everything changed.

Almost overnight, Mr. Sparkes began became medical cost-cutting demon.  He swapped out his OneTouch glucometer for a brand whose strips were considerably less expensive.  He located an on-line pharmacy in Vancouver, Canada that sold Humalog for $45 per vial, although their Lantus was the same price as in the U.S.  Most of his other brand-name drugs were cheaper there as well.  For others he switched to generics.  Some of these were $4 per month at Walmart or Costco – less than the $5 co-pay that he had been paying to his insurance company.  All along in the process Mr. Sparkes was planning for the time that he would be eligible for Medicare in July.  His goal was to manage all of his medications so that he would never hit the “donut hole” in Medicare’s drug coverage.  This is a gap in coverage in which beneficiaries have to pay for their own medications until their drug spending hits a certain threshold.

Mr. Sparkes’ story easily could be Exhibit A in the museum of what’s wrong with the way we’re “reforming” American healthcare.  As part of the Affordable Care Act (ACA or “ObamaCare”) legislation, Medicare’s “donut hole” is being closed.  This will, of course, remove any need for Mr. Sparkes or his fellow Medicare beneficiaries to worry about the magnitude of their medication spending.  And on the non-Medicare side, the ACA essentially outlaws the combination of high-deductible catastrophic healthcare coverage policies and Healthcare Savings Accounts (HSAs).  Because HSAs encourage their owners to make the most efficient use of the money in their accounts, eliminating them is a great way to covert patients from careful shoppers into people who are relatively indifferent to cost.

Now let’s do a little thought experiment.  Let’s say that the ACA is successful, and patients all over the country no longer care whether the drugs they buy cost $130 per vial, or $45 per vial.  Once the patient and his economic self-interest are removed from the equation, what tools are left that will allow insurers (including Medicare and Medicaid) to control costs?

Option #1:  Force drug makers to sell their drugs for less.  Of course this has some adverse consequences, such as reducing the capital and incentive any drug maker has to create new and better drugs.  Indeed these concerns – along with intense lobbying efforts on the part of the drug makers – are largely responsible for Medicare being legally prohibited from negotiating drug prices.

Option #2:  Drop the more expensive drugs from the formulary, making it impossible to prescribe them.  This already happens in virtually all health plans that “manage care” and HMOs such as Kaiser or the VA.  Of course the losers here are clinicians, who are frustrated at their inability to prescribe the treatments that may be best for their patients, and the patients themselves who may not even know that they are receiving second-rate care.  Coincidentally, removing these drugs from circulation also removes any incentive that drug makers may have for developing and producing them, making it not much different from Option #1.

Option #3:  Have insurers claim that all medications are available to patients, but make it so bureaucratically difficult for doctors to prescribe them that for all practical purposes they cannot be used.  This is a sneakier version of Option #2, but from the bureaucratic and political perspective it retains the advantage of shifting the blame from those who set up and run the system onto those “selfish and uncaring physicians who simply don’t want to take the time to practice high-quality medicine.  This option is probably the most common one in use today, and will almost certainly become the rule rather than the exception as ObamaCare is fully implemented.

The observant reader will note that all of these are forms of “rationing” that will directly or indirectly discourage the development and use of new treatments for a wide range of diseases, simply because there will be no market for them.  Of course Mr. Sparkes engaged in rationing too after his insurance ran out, but where, when and how he went about it was up to him.  At least he had the choice to continue using more expensive drugs if they worked best for him – a choice that the ACA will quietly but surely take away.

There is one other option, however, and it’s called reference pricing.  In this case insurers can decide to pay a certain amount toward a month’s supply of a drug or treatment of a given type.  For example, a given insurer might decide that a decent heart medication of a given type (e.g. a beta blocker), should cost about $50 per month.  If patients wish to use an alternative drug that costs $75 per month they may do so by paying the difference.  Referencing pricing has been used in Europe for some time and a version is offered by many private health plans in the U.S. as a system of “tiered” pricing.

We predict that reference or tiered pricing will be less “acceptable” in the United States if President Obama is re-elected and the ACA is allowed to continue its effort to protect patients from any exposure to healthcare costs.  Despite the example of Mr. Sparkes, when it comes to healthcare Americans apparently can’t be trusted with that sort of responsibility.

The digital ink was barely dry on our most recent post about manipulating the training of American physicians to make them perfect Renaissance men and women, when an article was published on the topic in JAMA by the brother of President Obama’s former White House Chief of Staff, Ezekiel J. Emanuel, MD PhD, and Victor R. Fuchs, PhD.

In our last post we described how the Association of American Medical Colleges (AAMC) recently decided to de-emphasize the sections addressing scientific knowledge in the Medical College Admissions Test (MCAT).  Instead of stodgy old biology, chemistry and statistics, the new test would emphasize psychology, ethics, cultural studies and philosophy in an effort to make physicians of the future less scientifically skilled, but more sensitive to the needs and feelings of patients and families.   We then examined yet another proposal to make physicians even more intellectually diverse by requiring them to be able to explain their medical bills to patients, again by shifting time and educational efforts from medical science to medical finance.

Against this setting Drs. Emanuel and Fuchs seem to think that we’re not doing nearly enough to dumb down and shortchange the medical training of those who will be doing our cardiac catheterizations and brain surgeries.

We don’t have full-text access to JAMA, but we do have access to a short blog piece that The Washington Post published on their proposal.  The post quotes the JAMA article thus:

“Why is medical school 4 years in length? The answer probably has to do with the Flexner Report’s recommendation in 1910 for 2 years of preclinical science training followed by 2 years of clinical training. Yet most physicians could be trained in significantly less time. Since 1997, the University of Pennsylvania has only 1 years of preclinical science training.

The important patient care skills can be obtained in less than 2 years of clinical training. The medical school at Harvard University requires students to complete only 15 months of clinical rotations….This change would be consistent with the increasing emphasis on individualized instruction and assessing students on core competencies rather than on time served. Consistent with this proposal, Texas Tech School of Medicine as well as 2 Canadian medical schools now offer 3-year programs.”

The Post then goes on to report that:

“Emanuel and Fuchs suggest reducing doctors’ training time by 30 percent, from 14 to 10 years. That would create space to train more doctors, they argue, while also reducing physicians’ debt burdens. It could also have the effect of driving down American doctors’ salaries, which are double that of doctors in most other countries, but often justified because of the profession’s expensive training costs here.”

It should therefore be no surprise that while the JAMA article is entitled: “Shortening Medical Training by 30%”, the blog entry in the Washington Post is called: “One way to cut health care costs: Cut medical training”.

Let’s take a moment to summarize:

1. We know from our last post about carefully crafting the politically correct physician, that the American public (or at least the AAMC) wants us to be admitting medical students who know less about science, and more about cultural awareness, empathy and ethics.  This is presumably so that patients feel better about being denied care that might have helped them had their doctors only known what was wrong with them and how to treat it.
2. Other folks have proposed substituting training in healthcare cost accounting and finance for clinical medical training early in the residency process.
3. Drs. Emanuel and Fuchs have now decided that, once admitted to medical school, medical students are learning far more than they need to know about things like anatomy, biochemistry, pharmacology, microbiology, biostatistics, neurobiology, histology and other things that would only come in handy if one were to eventually want to diagnose and treat physical and mental diseases.
4. Meanwhile, the Accreditation Council for Graduate Medical Education (ACGME) has implemented restrictions on the number of hours medical and surgical residents may work each week.  Although these restrictions were imposed for the laudable purpose of ensuring that physicians-in-training weren’t so tired that they would make lots of mistakes, they inevitably reduce the total amount of time that medical residents spend seeing patients, discussing cases and generally learning the very serious business of being a doctor.  Any weakness in one’s medical school training will be amplified by having less time to make up the difference while undergoing on-the-job-training.
5. As if that weren’t enough, poorly conceived, poorly executed electronic medical records have turned medical residency training from an educational experience into something more akin to secretarial school.  Attending physicians – the older and wiser doctors who have traditionally walked the wards and clinics with residents to show them the ropes of clinical care – now hold back for fear of taking too much time from their keyboard duties.  For a flavor what residency training has become in an era where administration and documentation has become more important and time-consuming than either patient care or medical education, we highly recommend this article by Michael B. Edmond, MD, MPH, MPA, and an attending physician and mentor to medical residents for over 20 years:

“Those of you who trained in the last century, as I did, will recall that the team room was the nerve center for managing the group of patients to whom you were assigned. It was a hub of activity that contained a large table where the housestaff reviewed thick paper charts, wrote their history and physicals, ate meals, and all the while shared the stories of their lives and their patients’ illnesses. It was strewn with EKGs, x-rays, photocopies of journal articles stained with coffee, and a worn edition of Harrison’s Textbook of Internal Medicine. You could walk into the team room at any time and immediately sense activity, observing multiple interactions among residents, students, and attending physicians.

Now, fast-forward to the modern-day team room: It still has a table, which if not physically then certainly figuratively much smaller and generally devoid of clutter. All of the action now occurs in the periphery of the room at a bank of computers where the housestaff sit nearly all of their working hours facing the wall. The room is silent except for the rhythmic clicking of multiple keyboards…

Before enforcement of the 80-hour workweek rule, residents would simply work longer in response to any unforeseen event, such as a patient’s sudden deterioration, or a planned event that took longer than expected. Part of the maturation process for young physicians was coming to terms with the daily unpredictability and lack of control associated with caring for acutely ill inpatients. However, the ability to stretch the day to accommodate the complexities of care has ended, and strict departure times have clearly added to the stress that our current house officers face daily….

I feel guilty if I ask the residents questions about themselves or what they did over the weekend as they type (and they are always typing), because I’m distracting them and using precious time. So I find that I don’t know them very well as people, and I suspect that they don’t know each other very well, either…  One of my colleagues, a master clinician and superb attending physician, says that he now feels guilty when he attempts to teach, because he can see the look of fright in the residents’ eyes as they wonder how the teaching session will impact their time.”

Incredible.  That we should create and maintain a system that makes attending physicians feel guilty for taking the time needed to pass on their unique and precious knowledge.  Simply incredible.

Yet amidst all of these demands culturally sensitive non-scientists who are trained faster and cheaper (solely so that the resulting doctors can be paid less), there has been absolutely no change in the level of expertise or performance expected of these same physicians by the public, by payers, by the legal system, or by the literally dozens of certifying and regulatory boards that now roam the nation.  The medical malpractice system – and clinical perfection demanded by its attorneys and juries – has not changed in 30 years.  Medical specialty boards pursue profits by filling their certification exams with needless trivia.  The federally mandated RBRVS payment system and scores of Medicare and Medicaid rules and regulations manage to suck up hours of time and money, add new “pay for performance” requirements and mandate the use of awkward and even defective electronic medical record systems, all while reducing net physician each year since the mid-1990s.

How can one country possibly be so schizophrenic, or unrealistic, about the investment it wishes to make in its physicians and the standards to which it wants them held?  And why on earth is the nation’s political leadership so obsessed with slashing physician income, when literally trillions of dollars are being wasted on administrative complexity and a host of other non-productive uses?  The money is just not there.

Let’s do a quick calculation.  There are about 800,000 clinically active physicians in the U.S.  Let’s say that each one is paid an average of $300,000.  (This is an absurdly high estimate.  The true weighted average is nowhere near that amount.  Many doctors don’t even have gross practice revenues that total that amount.)  Simple multiplication tells us that total amount of money directed toward American doctors each year is $240 billion.  Total U.S. healthcare spending in 2009 was $2.5 trillion, an order of magnitude greater than all physician income combined.  Even if every doctor in the country were forced to work for free as slaves, total medical expenses would drop by less than 10%.

Short of some actual mental illness, what would explain this sort of behavior?  Doctors are supposed to be experts on healthcare science and the management of disease.  Who will benefit from making them less expert, less trained and less experienced, all in the name of conformity, saving money, cultural values and software-mediated regimentation?  The most plausible answer is anyone who wishes to transform physicians from independent, scientifically informed advocates for patients, into relatively uninformed followers-of-guidelines.  Doctors following federally mandated guidelines for screening, diagnosing and treating patients don’t need to know any science; they just need to do what they’re told.

The end result may or may not be best for any given patient (perhaps you or a member of your family), but it will be less expense for Medicare, Medicaid and your private insurance company to have their doctors follow guidelines than to customize care.  Meanwhile given the lack of progress in reforming the world of medical malpractice liability, the blame for whatever happens continues to rest with the physician him/herself.  After all, he or she is the board-certified “expert”.

Well.  At least they were experts…