The Covert Rationing Blog

Getting Square With the Nurses

July 9th, 2008 by DrRich

Last month, DrRich wrote about how “doctor-nurses” are fixing to displace primary care doctors, and how the noble American Medical Association – champion, as always, of the American PCP – is mobilizing with decisive action to prevent this tragedy from taking place.*

One of the more remarkable responses to this article came in the form of a blog entry by DrRich’s colleague Annie, an entry which was, let’s say, critical.

DrRich is very sorry to have raised Annie’s ire, especially since Annie represents a combination of two of DrRich’s favorite kinds of people – nurses, and students of the Constitution. It is in this latter capacity that she writes for the blog Home of the Brave, a site that, if a bit leftward-leaning for DrRich’s tastes, is nonetheless dedicated to the very worthwhile goal of discussing “U.S. history, the state of the union, the state of the U.S. Constitution.” DrRich even gave top billing to one of Annie’s posts last week in Medical Grand Rounds – her nicely tuned article showing what the Founders might have said about the current sad state of the American healthcare system, an article which he now recommends again to everyone.

This public recognition of Annie’s obvious merits, despite the article she had written in response to DrRich’s posting on doctor-nurses, ought to attest to DrRich’s essential fair-mindedness and objectivity. For in that article Annie was less than kind to DrRich’s sensibilities. For instance, referencing DrRich, Annie said,

A few physicians are skeered of a new demon. They’ve got their Salem witch hunter judicial robes on, and they’re ready to order the press, the pyre or just a good old pompous piosity to their screed. What has their panties all in a bunch?

Doctorally educated nurses. I. am. not. making. this. up. They’re afraid of nurses.

What nurse bashing this is and based on what? Fear of competition?

Annie goes on some more about DrRich’s manhood and such (for the record, DrRich does NOT wear panties), but you get the idea.

More relevantly (more relevantly, at least, to everyone else if not to DrRich), Annie’s post points out that: a) nurses with doctorate degrees are not a new phenomenon; b) the vast majority of nurses are not out to displace physicians, or to usurp the title “doctor;” c) since there is an acknowledged shortage of PCPs, surely something has to be done to fill the void, and nurses – working in full partnership with doctors, as always – can help; d) the formidable Mary Mundiger (formidable, at least, to the lily-livered DrRich) does NOT speak for the large majority of nurses; and e) the organization that actually does speak for most nurses is the very reasonable American Association of Colleges of Nursing (AACN).

And the AACN is greatly disturbed by ideas, put forth by misguided paranoids like DrRich, that doctor-nurses may be getting ready to take over for actual physicians, and is distressed by the blowback that has already been experienced by the nursing profession as a result of such ideas. Indeed, Annie points out, the AACN is so alarmed by the resolutions being considered by the AMA (described here) - resolutions that, if passed, would potentially result in sending nurses a strongly worded letter - that it has issued a white paper itself urging the AMA not to take such drastic action.* This white paper passionately expresses

concerns regarding Resolutions 303 and 214, which are coming forward to the American Medical Association (AMA) House of Delegates. . .AACN is distressed by the tone of these resolutions, which may weaken the good working relationships established between many physicians and nurses….AACN requests that the AMA withdraw Resolutions 303 and 214, and if that is not possible, we urge members of the AMA’s House of Delegates to vote against these measures.

That is (Annie assures us, and the AACN certainly confirms), nurses, even most of the doctorally trained ones, want to play nice with physicians. And DrRich’s screed on the impending take-over of American medicine by hordes of aggressive nurses is both overdone, and very counterproductive.

In response, DrRich can only offer that he fervently desires that Annie, and any others who may have been offended by his earlier post, go back and read it again, but this time read it keeping in mind the following prompt: Irony. For DrRich’s comments were mainly aimed at satirizing the response of the emasculated and morally bankrupt medical establishment to the inevitable encroachment by nurses on what has traditionally been medical turf. DrRich was attempting to be ironic. (A colleague of DrRich’s, reading Annie’s posting, commented that those who miss the poorly-hidden subtleties of irony also may be likely to miss the well-hidden subtleties of difficult medical diagnoses. But this is unkind and likely incorrect, and DrRich chooses not to subscribe to it. Besides, this snide comment presupposes that DrRich does irony well, which may not be a good bet.)

Furthermore, DrRich would like to go on record to say that virtually everything Annie says (except for the personal stuff about his cowardice, Puritanical judgmentalism, exaggerated piety, panties, etc., much of which is simply not true) is pretty much correct. DrRich agrees that the large majority of nurses have no intention or desire to fundamentally displace American PCPs. And DrRich further agrees that doctors who resent nurses because they think they’re after their jobs are badly misguided.

But it’s not because ascendant nurses aren’t about to displace them that they’re misguided. They are indeed about to be so displaced. Rather, they’re misguided because most nurses don’t want any part of it either, just like Annie says.

Anyone who had read DrRich’s earlier articles on the plight of the PCP would understand that he does not consider the prospect of nurses encroaching on the turf of PCPs to be evil or bad, but simply the normal pattern in a modern society wherever advancing technology enables lesser-trained individuals to do things that in the past required highly-trained specialists. DrRich would never bash nurses for simply playing their natural part in the evolution of a technological society. He would sooner criticize a grizzly bear for dining on the entrails of an elk which had died of the mange.

The quotation Annie provides from the AACN white paper, protesting because the AMA is accusing nurses of doing what nurses are, in fact, doing (however involuntarily it may be) is quite telling. The train is leaving the station. The writing is on the wall. While it is clearly not Annie’s intent, or the AACN’s intent, or the AMA’s intent for nurses to replace PCPs, it’s happening just the same, as the night follows the day. Neither the PCPs, nor the nurses who may be startled and intimidated by the prospect, can ultimately stop it.

Those doctors who do view the encroachment by nurses as an unadulterated evil deed will see the protestations of innocence by the AACN - while events on the ground so clearly contradict them - as something similar to the soothing murmurings of the Japanese Ambassador while preparations for Pearl Harbor were in their final stages. They will see it as disingenuous at best, treachery at worst. But viewing it this way is simply wrong.

The posting by Annie and the white paper of the AACN are actually indications that most nurses are as apprehensive as are the PCPs they are displacing. And why shouldn’t they be? Look at the new responsibilities and risks the nurses will be acquiring - medical, moral, legal, financial and otherwise. Historical upheavals like this are often unkind to all parties involved, even the supposed “winners.”

If further evidence is needed that DrRich is correct (beyond simply studying the history of technological societies), simply read the July 2008 Update of the Hospital Outpatient Prospective Payment System issued by CMS. This document (if you can get through it) among other things removes language from the Medicare Benefit Policy Manual that had required that “services furnished in provider-based departments of hospitals must be rendered under the direct supervision of a physician who is treating the patient.” That is, non-physician care providers are now allowed to provide care for Medicare patients in a hospital outpatient department without any supervision by any physician who is caring for the patient.

CMS is already there, and is very obviously clearing the path for the inevitable. Everybody needs to get ready for this - the PCPs, and the patients, and even the reluctant nurses.

* This is an example of irony.

Posted in Primary Care in America | 5 Comments »

Are Doctors Garnishing Tax Payments to Recover Funds From Medicare?

June 25th, 2008 by DrRich

The Wall Street Journal recently reported that Congress is urging Medicare administrators to assist the IRS in garnishing payments to doctors (and other “contractors”) who owe federal taxes. The Government Accountability Office estimates that providers owe more than $2 billion in back taxes, and withholding Medicare payments to providers is seen as an expeditious method of collecting those owed monies.

DrRich is shocked (shocked) not only that a body of Solons such as Our Congress could so egregiously misinterpret the actions of forthright American physicians, but also that the WSJ itself (a bastion of American capitalistic thought) could fail to recognize the true nature of those actions.

For DrRich suspects there is an alternative explanation that places the alleged tax deficiencies of American doctors in a somewhat different, and far more heroic, light. Namely, when (if) doctors are withholding tax payments, they are not doing so as common tax cheats. Heavens, no. Rather, they are doing so for entirely justifiable and noble (if illegal) reasons.

First, they are trying to break even. In contrast to what is seen with most of the revered professions (wherein the payment due to the professional is transparently negotiated, or is simply “set” by the professionals themselves according to what the market will bear), the pay of physicians is determined by Acts of Congress. Even now, before the next set of impending, Congressionally-determined physician pay cuts, Medicare does not reimburse doctors enough to cover the overhead of most office visits.* Some say this makes the business of office practice economically dicey. In fact, it is already impossible for a stand-alone, independent primary care doctor to make a living caring for Medicare patients.

Second, Medicare has successfully inculcated the Fear of God into physicians regarding the now-federal crime of healthcare fraud. The penalties for committing healthcare fraud are so onerous that merely being accused of it is enough to induce most physicians to beg for a settlement deal, regardless of the strength of their defense, and regardless of the fact that most such settlements are personally and professionally ruinous. And the opportunities to be accused of fraud are unlimited for even the most fastidiously honest among physicians. (The arcane E&M coding rules, which have been formally proven impossible to follow, afford the opportunity for the feds to point the fickle finger of fraud, quite arbitrarily, toward any American doctor who treats Medicare patients, at any time.) Not wanting to appear fraudulent to Medicare is foremost in the minds of American doctors (which pushes “wanting to help their patients” down to Number Three on physicians’ priority list, right after “wanting to avoid spurious malpractice suits”).

As a result of these two considerations, it is conceivable** that some physicians, wanting to continue the noble practice of caring for Medicare patients, but at the same time wanting to be fairly reimbursed for same (at least to the extent of breaking even), have made a simple calculus. Inasmuch as the government owes them fair reimbursement for services they render to government entitlees, and inasmuch as the government has not been forthcoming with said fair reimbursement (and promises to be even less forthcoming in the very near future), therefore (some physicians may have concluded), they will simply exercise whatever opportunities they may find to recover some of these owed funds on their own initiative. For much the same reason that Congress is proposing to garnish Medicare payments to doctors, perhaps some doctors are garnishing tax payments to the IRS.***

It would indeed be telling if physicians who reach such conclusions (if indeed there are such physicians) have decided to recover funds they feel the government rightfully owes them, not from Medicare, but instead from the IRS. These doctors would obviously have concluded, quite logically, that dealing with the wrath of the IRS is far, far less intimidating than dealing with the wrath of the federal healthcare fraud establishment, whose tactics would make the average American physician beg for the rights and considerations afforded to your average Guantanamo detainee (especially since last week.)

Small wonder that the relatively meek and unassuming IRS has asked for the help of their nastier federal brethren in cracking down on recalcitrant doctors.

Whatever the correct explanation for it, however, the prospect of the IRS and Medicare teaming up in enforcement efforts ought to send chills through every American physician, and should stimulate among them significant second thoughts about their career paths.

Speaking of which, here’s a second thought they should consider, and soon.

*These comments, as usual, pertain almost exclusively to PCPs. Specialists (such as DrRich when he still practiced), are doing just fine, what with the procedure-based reimbursement system their brethren on the RUC have arranged for them. Unlike PCPs, who lose money every time a Medicare patient darkens their door, specialists can make up for lowered per-unit reimbursements by cutting corners and increasing the volume of procedures they perform. It’s not particularly pleasant (or safe), but it is what it is, and the specialists have learned to get by.

**Note to IRS and CMS agents: Hi, fellas. DrRich has no personal knowledge, direct or indirect, of any of this sort of illegal behavior; he is simply taking known facts and extrapolating them to their logical conclusions.

***It is a law of history that bad law and bad regulations eventually create contempt for authority, and progressively render various illegal actions rationalizable, reasonable, justifiable, and finally, ethical. Even those who sympathize with physicians on this matter (and DrRich suspects these are few indeed), would say that that the rationale for not paying owed taxes has progressed certainly no further than the “rationalizable” stage, if that. But the natural tendency of governmental authority to progress toward arbitrariness is the very thing that  led Jefferson to muse that continued societal vitality might require revolutions every few generations. I’m just sayin’.

Posted in Healthcare economics | No Comments »

Is Guideline Tyranny Causing Guideline Anarchy? (Part I)

April 30th, 2008 by DrRich

The Tyranny of Guidelines

Anybody practicing medicine today needs to be serious about medical guidelines.

The original idea behind medical guidelines was to provide (oddly enough) a guide to physicians in caring for patients with a particular medical problem. That is, they suggested a generally preferred approach to medical care in view of current medical evidence, but did not attempt to dictate care in all cases. Medical guidelines were to serve as a roadmap which, while usually suggesting a favored route from point A to point B, always allowed that for individual patients, some alternative route might be preferred or necessary.

As originally conceived, medical guidelines (based as they were in classic evidence-based medicine, as Dr. Poses reminds us) were designed to encourage the “conscientious, explicit, and judicious use of current best evidence in making decisions about the care of individual patients.” It was simply assumed that in applying such guidelines clinicians would continue “integrating individual clinical expertise with the best available external clinical evidence from systematic research.” That is, guidelines were supposed to serve as a touchstone for doctors attempting to tailor the best available current evidence to the care of their individual patients.

It goes without saying that medical guidelines are actually not being used in this way today.

Under a healthcare system where controlling the behavior of physicians (in a vain attempt to control costs) is Job One, “guidelines” are treated as a set of unalterable rules - as definitive steps that must be followed in all cases, without exception; and that, if taken, will yield that which is defined as high quality medical care, and if not taken, will yield that which is defined as low quality medical care. Once quality is defined as compliance with guidelines, then “physician report cards” based on such compliance can be made available to the public, and can be used to steer patients to the “high quality” doctors and away from the “low quality” ones. Lately, the highly popular gambit of Pay for Performance assures that doctors are explicitly rewarded (like trained seals) for following whichever of the sundry lists of guidelines is preferred by the payer of record, to assure excellent quality (and, incidentally of course, to reduce cost).

And now, the most recent revelation from our friends at Medicare is that the mere existence of a set of guidelines can render certain medical problems, whose incidence in fact can sometimes be reduced but never eliminated, as “never events,” the occasional occurrence of which thus becomes punishable. When Medicare expanded its list of these “never events” a few weeks ago, the agency’s chief justification for doing so appears to have been the availability of guidelines that can allegedly reduce the likelihood of their occurrence.

It is notable that there are no rules for writing guidelines, and no generally agreed upon requirement for transparency (such as, for instance, elaborating on the criteria used for accepting, rejecting or ranking various sources of available medical evidence used in formulating them). A group of “experts” that has been given (or that has taken) the authority to develop a new set of guidelines assumes the role of potentates, and they can devise guidelines every bit as detailed and as extravagant as they choose (so long as they give the nod to, and can plausibly claim their work to be derived from, “evidence-based” considerations).

Once the new guidelines are chiseled onto stone tablets and brought down the mountain to the abject throngs of awaiting doctors (for it is almost always true that the mere practitioners who are charged with living by the guidelines are rarely the same as the exulted experts who get to devise the guidelines), it matters not whether physicians working under strict time limits will find it impossible to comply with each exquisite detail, or indeed, whether strictly following these guidelines might even have harmful unintended consequences for patients. The guidelines, once designated by various insurers or the feds as being “the” guidelines, must be obeyed. (And if it turns out that the guidelines simply cannot be obeyed, say, due to their sheer ungainliness, then large masses of doctors can be threatened with lawsuits for non-compliance, if not for accessory to murder.)

Guidelines treated in this manner clearly violate the original intent of evidence-based medicine in general, and of medical guidelines in particular. But when you’ve got to do whatever it takes to direct the behavior of physicians (the ones who, with the touch of a pharmaceutical-logo’ed pen, can bend the entire medical-industrial complex to their every whim), medical guidelines simply must be perverted into a tool of control.

Medical blogs have done a pretty good job of chronicling the growing tyranny of medical guidelines. A less well-documented result of this tyranny, a phenomenon that is just now coming into focus, is the mad scramble by diverse interest groups to promulgate their own sets of guidelines, and subsequently fight to have them accepted as “the” guidelines, thereby to gain control the medical agenda. Guidelines written by competing interest groups will often direct doctors to do very different things, and will set up some very interesting turf battles.

In Part II we consider this “anarchy of guidelines,” now taking shape as a direct result of the guideline tyranny under which doctors labor, and patients risk their lives.

Posted in Guidelines, Abuse of | 3 Comments »

Never Events? Never Mind

April 18th, 2008 by DrRich

Medicare’s newfound passion for quality has found yet another avenue of expression.

A year ago the Centers for Medicare and Medicaid Services (CMS) announced it would no longer pay for the treatment of certain medical conditions that occur after patients have been admitted to the hospital. These conditions were:

* Bed-sores
* Two kinds of catheter-associated infections
* Air embolism
* Mediastinitis after coronary bypass surgery
* Giving patients the wrong blood type
* Leaving objects inside surgery patients
* In-hospital falls

Now, according to the Wall Street Journal, CMS has proposed adding several new conditions to this list, to wit:

* Surgical site infections following certain elective procedures
* Legionnaires’ disease
* Extreme blood sugar derangement
* A collapse of the lung resulting from medical treatment
* Delirium
* Ventilator-associated pneumonia
* Deep vein thrombosis/Pulmonary Embolism
* Staph infection in the bloodstream
* Disease associated with Clostridium difficile infection

Several commentators admired by DrRich have blogged on the advisability of declaring these particular conditions to be “never events.” All agree that while certain of them clearly should never be permitted to happen (e.g., leaving claw hammers inside a patient’s abdomen, or transfusing the wrong blood), certain other ones are going to continue happening to some patients no matter how high the quality of the institution and the medical professionals. (DrRich particularly recommends the Happy Hospitalist’s cogent and entertaining analysis of the matter.)

Because this topic has been so well-covered, DrRich does not need to comment any further on the unfairness of insisting that doctors prevent every single instance of conditions that are often not particularly preventable; or on the fact that insurance companies (as they always do) will soon follow Medicare’s lead and also refuse to pay for these “never events;” or that hungry attorneys will now begin suing doctors and hospitals for unavoidable complications because those complications have been federally designated as avoidable; or even the fact that, having so deftly expanded the horizons of what can be considered a “never event,” the feds have cleared the path for defining virtually any medical condition they choose as a “never event.” (As a case in point, the feds’ own guidelines on preventing delirium, referred to in their own “fact sheet” that purports to justify the expanded list of “never events,” admit that there are no effective guidelines for reliably preventing delirium.)

There’s also no point in complaining publicly about this expanded list of “never events,” since the public is foresquare behind the notion that no medical complications should ever occur and if they do it is somebody’s fault, and equally behind the notion that the feds can squeeze quality into the system just by demanding it to be so. Therefore, any doctors who complain about these new, tough quality measures will reveal themselves to be both anti-quality and low-quality doctors.

Rather, DrRich will refer back to the true mission of this blog, and simply explain to his readers how this new “never event” strategy furthers the true mission of Medicare and the insurers, which is to say, covert rationing.

For Medicare and the insurers are like closet narcotics addicts - while smiling their pasty smiles and assuring us that each and every one of their new initiatives are only concerned with quality and nothing else, the whole time, with every ounce of their being, they are inventing ways to manipulate, deceive and twist each and every opportunity into some means of scoring another covert-rationing “hit.” Consequently, we cannot go wrong if we ask, each time we see some new program ostensibly aimed at quality improvement: Where’s the rationing?

One might think the rationing in this case is easy to spot. After all, if the feds stop paying for “never events” that actually cannot be avoided, they will save dollars right up front simply by refusing to pay for services rendered. But Medicare itself has estimated that its up-front annual savings from its original list of “never events” would be only about $20 million. And that seems hardly worth the effort.

The real savings will come from a place far more sinister than that. The “never events” initiative - just as the feds tell us - is aimed at changing physicians’ behavior. But quite predictably, that behavioral change will not be in the arena of quality improvement (since no amount of quality improvement can stop “never events” that are inevitable). Rather, the behavioral change will be in the arena of risk avoidance.

While it is unlikely that doctors will ever refuse to care for high-risk patients who are experiencing genuine medical emergencies, it is quite likely they will stop recommending elective medical therapy for high-risk patients. Patients who seem particularly prone to infection, bed sores, falls, blood sugar abnormalities, blood clots, delirium, or who seem likely to need intravenous antibiotics (which predispose to C. difficile) will be particularly targeted. Roughly speaking, these patients will include diabetics, the elderly, anyone with a clotting abnormality or a history of blood clots, the obese, people with immune disorders, and the chronically ill.

Doctors, of course, have always computed a risk/benefit analysis before offering elective services (such as hip replacement, coronary artery bypass grafting, back surgery, gall bladder surgery, anti-obesity surgery, etc.) to such patients. The increased risk of complications these patients face always has factored into such calculations, and into the doctor’s ultimate recommendation.

But now, the “risk” part of the risk/benefit analysis will include two important new risks, and this time they are risks to the doctor herself (and her institution): 1) If any of these complications occur, no payment will be made for the (often very expensive) treatment the complication will require; and 2) If a complication occurs, another “never event” will be tabulated in the federal database next to the doctor’s (and the hospital’s) name, which will inevitably show up in a public report card.

Lest anyone think that doctors would not really stop recommending clinically indicated care to patients just because of the personal risk it would entail, remember that it’s already happened, and is well documented. The government and the insurance companies have already conducted that experiment; it’s been completed, the results have been tabulated, reported, and duly noted. It turns out that doctors, like most other people, respond quite logically to negative incentives.

CMS knows exactly what it’s doing here.

Posted in General Rationing Issues | 5 Comments »

Covert Rationing Even Wrecks Socialism

December 11th, 2007 by DrRich

Last week, John Goodman wrote a provocative piece about what he’s termed the “nonprice rationing” of healthcare. By nonprice (or nonmarket) rationing, Goodman means the kind of rationing you get when the government, rather than market forces, control the healthcare system - specifically, he’s addressing a system of socialism. He offers five principles of such nonmarket rationing, which I paraphrase here:

1) Any excellence that may exist is not systematic, but instead occurs spontaneously and randomly.
2) Access to this random excellence is not random; the rich and connected are the ones who get it.
3) The skills that allow people to succeed in a market system are the same skills that allow them to succeed in a nonmarket system (i.e., one’s wits will determine one’s access to excellence).
4) Doctors rationing at the bedside will make value judgments about their patients; youthful and highly productive (and presumably influential - DrRich) patients will get an unequal share.
5) People at the bottom of the income ladder will almost always do better in a market system.

To sumarize: Despite the inevitable efforts of the government to homogenize healthcare under socialism, pockets of excellence will still randomly appear. The rich, the connected, and the quick-witted will find those pockets of excellence. So: the same people who are getting decent healthcare today will continue to get better than average healthcare under a government system, and the peons will suffer even more than they do today under a more market-based system (where they at least have a shot).

Goodman also says:

I am probably one of the few people you interact with who has a real interest in understanding nonprice rationing of health care. In fact, I may be the only such person. . . .In fact, I don’t believe anyone has developed a real theory about it.

Readers, please do not think too badly of Dr.Goodman just because he has not yet heard of DrRich or his Grand Unification Theory of Healthcare (GUTH), the theory that explains everything. Dr. Goodman’s a busy man, and DrRich is, well, obscure.

Does the GUTH account for Goodman’s “nonmarket rationing?” Indeed it does. Does it reach the same conclusions as Goodman? Well almost, but not quite.

The difference? Goodman’s formulation could be applied to almost any aspect of a classic socialist system, where virtually all goods and services are controlled (i.e., rationed) centrally. The same five principles (with the possible exception of principle 4, which seems to refer specifically to physicians) would hold under a socialist economy whether you’re talking about healthcare, cigarettes, plumbers, or wheat.

Under a socialist system, there will always be shortages of everything; but on the other hand there also will always be special caches of the rationed item, which somehow will be made more-or-less available to the rich, the connected, or the quick-witted. (The Cuba segment of Michael Moore’s Sicko, for instance, nicely displays the special cache of healthcare excellence that Cuba makes available to the fortunate few, such as American filmmakers bent on embarrassing the Bush administration). This inherent aspect of socialism is merely a concession to reality. Perfect socialism, requiring as it does a fundamental change in human nature, cannot exist. So special caches (whether of gasoline or of medical excellence) will always be permitted to spring up and to persist, at least tacitly. Trading in these special caches, after all, is how the central authorities a) maintain their power, and b) get to have some of the special stuff themselves.

Goodman’s formulation derives directly from the classic behavior of socialist systems, and thus must be correct. And being correct, it must also be compatible with the GUTH; and so it is.

But the GUTH adds a twist. The twist is: We’re Americans, and Americans don’t ration. So the central authorities who control the American healthcare system have got to do the rationing covertly. (In contrast, rationing under classic socialism is quite open.) Covert rationing corrupts everything it touches (Corollary 4 of the GUTH). Ironically, it even disrupts the inherently corrupt style of rationing classically seen under socialist systems.

Goodman points out that under classic socialism,

Since there is no financial reward for excellence and no financial penalty for mediocrity, excellence tends to be the result of the enthusiasm, energy, and leadership of a few people scattered here and there.

That is, socialism creates no incentive for excellence. Whatever pockets of excellence you get will have to be created by a few special individuals who are unusually self-motivated.

What this formulation does not account for is that under the American healthcare system, dedicated as it is to covert rationing, the Wonkonians are aggressively putting into place several powerful reverse incentives. These reverse incentives, we’ve seen (we being readers of this site), are aimed at actively stamping out, eradicating, and punishing any self-motivated physician who tries, despite all obstacles, to deliver excellent healthcare. Among these are the mandate that primary care doctors spend only 7.5 minutes per patient encounter; invoking the magic of P4P to determine exactly what must and must not take place during that 7.5 minutes; grabbing the right to interpret clinical science in order to formulate the “guidelines” that inform P4P; coercing doctors to agree to egregious adhesion contracts that any sane person would find unconscionable; forcing doctors to practice under a set of coding “guidelines” that prevent good patient care and serve as traps for “fraud;” and in general, making every patient encounter subject to a web of regulatory speed traps that force doctors to concentrate on keeping the OIG at bay rather than on what the patient needs. In short, in their efforts to gain control of physicians’ behavior in order to covertly ration healthcare, American Wonkonians are creating insurmountable and systematic disincentives for excellence, and severe penalties for non-mediocrity. They have placed doctors in the untenable position of being utterly unable to fulfill their professional, traditional, legal, and ethical obligations.

The only way doctors will retain a realistic opportunity to achieve excellence under such a system (so as to service at least the rich, the connected and the quick-witted), will be to abandon the system altogether.

Perhaps somebody can purchase an obsolete Soviet aircraft carrier, convert it into a state-of-the art hospital ship, staff it with renegade American physicians, park it in international waters off the east coast, and ferry Congresspersons back and forth by helicopter to receive their well-deserved excellent healthcare. Under a covert rationing paradigm, that might be the only way to fulfill Goodman’s five principles, even if we end up with a fully socialized healthcare system.

Posted in Wonkonian Rationing | 8 Comments »

Why Implantable Defibrillators Have To Be Rationed

November 6th, 2007 by DrRich

Before leaving medical practice eight years ago to become a writer and consultant, DrRich spent nearly 20 years as a cardiac electrophysiologist - a cardiologist specializing in the treatment of heart rhythm problems. And from 1982 until he left practice, his major research focus was to help advance the safety, usability and effectiveness of the implantable defibrillator (known as the ICD).

The ICD is an implantable pacemaker-like device that monitors the heart rhythm, and if a fatal heart arrhythmia occurs (an event known as a cardiac arrest), it automatically shocks the heart back into a normal rhythm. Almost from the moment of its first use in patients in 1982, the ICD has been the only method ever developed that substantially reduces the risk of sudden death in high-risk patients. If a person with an ICD has a cardiac arrest, there is roughly a 99% chance that the ICD will save them.

The ICD has become the poster child of covert healthcare rationing, and in his writings on this space DrRich has not been shy about pointing that out, for instance, here, here and here. DrRich believes that covertly rationing the ICD, like all covert rationing, is harmful to individuals and to society. In this particular case, the large majority of high-risk patients who have clear indications for ICDs - supported by clinical science, by professional guidelines, and even sanctioned by HMOs and Medicare - are not receiving them. And as a result, it appears that thousands of patients who could have received ICDs are dying suddenly. (Over 300,000 Americans die suddenly from cardiac arrest each year.) But the problem goes even deeper than that.

There are three features about ICDs that make them compelling targets for rationing. The first two render them attractive targets for covert rationing. ICD companies and the electrophysiology community are well aware of these two features, and in their own ways are working to counteract them. But the third feature will require limiting (or even eliminating) the use of ICDs even if we were to move to a system of fair, equitable, open rationing. And here, both ICD companies and electrophysiologists are in a state of continued and obstinate denial.

Feature 1) Preventing sudden death is hugely expensive.

ICDs themselves and the medical procedures necessary for their implantation are very expensive, generally $30,000 or higher, and estimates are that upwards of 500,000 “new” candidates for ICDs are created each year. (These new candidates come from the pool of patients who survive heart attacks or develop heart failure annually.)

The finances look even worse if you’re a Medicare administrator or an HMO executive. To you it looks like this: Today, sudden death removes hundreds of thousands of high-consumers from the rolls each year. If these patients were instead to receive ICDs, then not only would you have to pay for the ICDs, but you would also have to continue paying their long-term healthcare costs (which are substantial since most have chronic, underlying heart disease), not to mention their Social Security. Today these people are conveniently and efficiently dropping dead, and preventing their sudden deaths would create a huge problem for you - even if the ICDs themselves were free. You can only conclude that preventing sudden death is simply bad public policy.

Feature 2) There is no constituency for sudden death.

Under a system of covert rationing, the rationing decisions are not based on issues of efficiency, effectiveness, or fairness - they’re based (and MUST be based) on what you can get away with. And it is particularly easy to get away with covertly rationing ICDs.

This is because sudden death has no constituency. Breast cancer has a constituency; AIDS has a constituency; cerebral palsy has a constituency. But Jerry Lewis never held a telethon for sudden death.

The large majority of people who are at high risk for sudden death don’t realize it. After a sudden death has occurred, the surviving family is often told that their loved one died of “a massive heart attack,” or some other purely unpredictable and unavoidable “act of God.” Patients and loved ones do not have, and doctors do not choose to impart, any sense of the predictability, preventability, or survivability of such a thing. So there is precious little demand for ICDs; what little there is can easy be ignored or pandered to.

The bottom line: Under a covert rationing paradigm, preventing sudden death is something payers (whether the government or insurance companies) will naturally and desperately want to avoid. At the same time, since sudden death has no constituency and there is no great hue and cry about it, it will be relatively easy for them to get away with rationing ICDs. Clearly then, if there’s any medical therapy that’s ripe for covert rationing, the ICD is it.

But even if we were able to eliminate covert rationing today, ICDs would still require rationing. This is because:

Feature 3) The ICD industry and their chief customers - electrophysiologists - embrace a completely dysfunctional and counterproductive business model.

Building and selling ICDs is an enterprise whose continued success utterly depends on maintaining very high price points. While the unit cost for building an ICD may be a few thousand dollars, to make ends meet most of these devices must be sold for over $20,000. This is because ICD companies get paid only once for an ICD - on the day of implant - but they continue incurring expenses as long as the device remains in service. These “lifetime” expenditures include monitoring of device function; maintaining expensive, rigorous quality and reliability processes; and backing up every implanted device with a large force of highly-trained and expensive field clinical engineers who are available to electrophysiologists 24/7, anywhere and everywhere, for “troubleshooting” and even for routine follow-up. All this “extra” stuff must be fully accounted for in the initial cost of the device. High price points therefore are essential to this business model.

Maintaining high prices in a competitive environment is not easy. It requires that ICD companies release “new” models every year or so. Occasionally these new models have useful improvements, such as smaller size or longer lasting batteries. But frequently they are simply “fancier” in some way that is designed to achieve a marketing advantage with their customers - high-end electrophysiologists.

Electrophysiologists have a clear agenda here as well. Their “demands” on ICD companies, expressed in rigorously conducted marketing surveys and focus groups, inexorably lead to ever more complex devices. This complexity allows electrophysiologists (a small community whose growth is tightly controlled) to maintain a professional stranglehold over the implantation and management of ICDs. It’s a matter of turf protection. Since ICDs are already exceedingly complex devices, and grow more complex with each succeeding generation, then “obviously” one must be a high-end specialist to understand and manage all their nuances. (In real life, they are so complex that not even many electrophysiologists can keep up with them, thus necessitating the need for armies of field clinical engineers in the employ of ICD companies.)

Clearly, this business model - as manifested by the synergy between ICD companies and cardiac electrophysiologists - is fundamentally dysfunctional. It utterly precludes ICDs ever becoming as widely used as both ICD companies and many electrophysiologists think they ought to be, that is, in hundreds of thousands of new patients each year.

Under a system of healthcare rationing - whether overt or covert - this business model is simply a non-starter. Even observers like DrRich, who devoted his career to the problem of sudden death, can begin to sympathize with Medicare and the HMOs in their attempts to stifle the use of ICDs under such a model.

Unfortunately, covert rationing fosters a perpetual continuation of this dysfunctional business model. Open rationing, on the other hand, would immediately reveal this model as being entirely obsolete and unworkable, and might (at last) goad the ICD industry into the direction it ought to go - toward developing implantable defibrillators that are simple, reliable, effective, easy to implant and manage, long-lasting and cheap.

ICDs are not only the poster child of covert rationing, they are also a particularly compelling example of how covert rationing inherently fosters waste, profligacy, inefficiency, and tangled and counterproductive incentives, throughout the healthcare system - even in the private sector, whose proponents invariably extol its natural efficiency.

Posted in General Rationing Issues | 2 Comments »

Pay for Performance and Covert Rationing (2)

September 14th, 2007 by DrRich

In a previous post, DrRich described the most obvious problems with Pay for Performance (P4P) when applied under a system of covert rationing. In the present post he addresses some of the more subtle and insidious aspects of P4P.

Consider, firstly, that the large insurers - and to some extent Medicare - have by now successfully dictated to primary care physicians that they can spend only 7.5 minutes (or perhaps 10 minutes if they’re lucky) per patient visit. This mandated brevity, indeed, is one of the chief complaints voiced today by both primary care doctors and their patients.

On the heels of this considerable success these same third-party payers now have launched P4P, which gives them the ability to dictate exactly how those doctors must spend their 7.5 minutes. If the doctors hope to avoid (at best) missing out on their 5% bonus or (more ominously) getting blackballed for delivering poor quality care, they’ll spend that allotted time doing whatever their P4P checklist says they must do.

Doctors can’t possibly do everything; P4P relieves them of the burden of having to decide which of the important patient care tasks they’ll do, and which will have to wait for a more propitious time, such as when the cows come home.

Now, DrRich will be the first to admit that most of the things on the P4P checklist seem potentially useful or at least benign. You can look at common P4P-approved tasks in a report from PriceWaterhouseCoopers, and see for yourself. How can anyone argue with cancer screening, cholesterol management, diabetes management, or the appropriate use of asthma drugs? These things are all good for patient care, aren’t they?

Sure they are. In fact, the designers of P4P programs have taken pains to make sure that the items they have put on on their checklists to date will not only reduce costs, but, whenever possible, will also be reasonably likely to improve patients’ health (or at least will be perceived that way). It’s one of the things that makes criticizing P4P so unrewarding.

But one would have to be very credulous indeed to believe, despite vociferous protestations declaring it to be so, that insurance companies and the feds are making a Manhattan Project out of P4P purely out of their passion for good outcomes. It is clear that reducing the cost of care is the chief driver of the P4P movement, and if it isn’t likely to reduce the cost of care, it isn’t going to make the P4P checklists.

Unfortunately, many patients need medical care that isn’t going to reduce the overall cost of care. Quite the contrary.

Take, for example, the 20% of Medicare patients who have at least 5 chronic medical conditions, and take at least 5 prescription drugs. Tending maximally to each of those medical conditions will likely cost a lot of money. Holding the office visit to 7.5 minutes, of course, goes a long way toward limiting the care that can be provided. But it still leaves the doctor with a disturbing degree of latitude. When deciding which of these problems to address during the brief office visit, the unfettered doctor might well choose a problem whose optimal management will greatly increase the cost of care. But happily, under P4P the decision of which problem to address is already made. The checklist reveals the appropriate choice.

For another example of optimal medical care greatly increasing the cost of care, consider the hundreds of thousands of heart attack survivors each year who are at increased risk for subsequent sudden death. Good clinical studies, supported by formal guidelines, recommend implantable defibrillators for many of these individuals. But implantable defibrillators, being extremely expensive, are mysteriously absent from anyone’s list of P4P clinical practice guidelines. (The sad fact is that preventing sudden death by any method, no matter how cheap - since it would prolong the life of patients who would otherwise continue consuming lots of healthcare due to their underlying heart disease - is diametrically opposed to the real purpose of P4P. Under a system of covert rationing, preventing sudden death is simply bad public policy.)

But P4P not only limits the options of the doctor. It also limits the options of the patient. While patients have the right to turn down therapy that is recommended by P4P guidelines (and that is duly parroted to them by their higher-quality physicians), they are unlikely to be offered alternative choices not sanctioned by the guidelines, unless that alternative therapy is cheaper, or their doctors are willing to defy the insurance companies or (even less likely) the heavy hand of the feds.

Finally, since succeeding with many of the P4P measures requires not only that the doctor treat the patient appropriately, but also that the patient become fully compliant with the treatment recommendations (carefully following, for instance, their diabetic regimens), P4P may cause doctors to avoid accepting into their practices patients who seem unlikely to follow their instructions. Such patients will tend to include the poor, the disadvantaged, and the undereducated. But then, in all fairness to P4P there’s really nothing new here; these individuals are already the most likely victims of covert healthcare rationing.

So P4P offers many advantages to a healthcare system predicated on covert rationing.

• It pushes doctors to do the things, useful or not, that reduce the cost of healthcare.
• It prevents doctors from doing the things, even if useful, that increase the cost of healthcare.
• It helps weed out or change the behavior of doctors who “think they know better” than the centralized agencies of medical excellence.
• It limits the options presented to patients.
• It induces doctors to “cherry-pick” compliant patients, leaving the less accommodating ones to go fend for themselves.

No wonder everyone is on the P4P bandwagon.

Posted in General Rationing Issues, Primary Care in America | 2 Comments »

Former CMS Official “Admits” to Covert Rationing

July 16th, 2007 by DrRich

In his forthcoming book, Fixing American Healthcare - Wonkonians, Gekkonians and the Grand Unification Theory of Healthcare, DrRich demonstrates how the imperative to covertly ration healthcare causes payers to bastardize evidence-based medicine. In a recent interview in Health Affairs, Sean Tunis MD, formerly Medical Director for the Centers for Medicare & Medicaid Services (CMS), goes a long way toward admitting this to be the case.

The case in point was a CMS coverage decision that was made in 2003 regarding the expanded usage of the implantable cardioverter defibrillator (ICD). The need for a coverage decision arose because a major randomized clinical trial (MADIT II) had been published demonstrating beyond reasonable doubt that patients with prior heart attacks and compromised cardiac function had significantly better survival if they received ICDs.

To make a long story short, despite incontrovertible scientific evidence that these patients would benefit from ICDs, despite the endorsement of the MADIT II results by professional organizations, despite the fact that most private insurers in the US had already expanded coverage to this new patient group, and despite the fact that CMS’ own advisory panel (hand picked by CMS) voted 7 -0 to expand coverage, CMS declined to do so. (Actually, they expanded coverage to some extent, but not to the extent supported by the evidence.) In making their non-coverage decision, CMS resorted to a particularly “interesting” form of statistical analysis that more objective observers recognized right away as statistical legerdemain.

In the recent Health Affairs interview, Dr. Tunis at last sheds some light into this decision. Cost, and not just scientific evidence, must be taken into account. He says,

“It was well understood by me and others at CMS that ICDs were expensive and that there were a lot of additional people who might be eligible for an ICD, and that added up to a large amount of money. So what does that cause us to do differently than for decisions with less potential financial impact? It causes us to look extremely carefully at data on safety and effectiveness. You might think of this as an upside-down or inside-out variation of a cost-effectiveness analysis in which the evidence threshold for coverage is implicitly adjusted based on a qualitative judgment about the economic impact of the decision.”

“In fact, explicit statements have been repeatedly made by Medicare that cost is not factor in coverage decision making. But my guess is that for anyone who works for a large payer in a policy environment that is increasingly panicked about the cost of health care, it’s easy to imagine how economic impacts could still have subtle and perhaps even unconscious effects on some of the scientific and value judgments that we have been talking about, whether or not these folks are told to ignore costs.”

Allow DrRich to interpret: Because CMS had to take cost into consideration, but at the same time because it is the explicit policy of CMS not to take cost into consideration, their only choice was to twist the science in such a way as to make the coverage decision they had to make because of cost considerations, while “blaming” the decision on the science.

To his credit, in the Health Affairs article Dr. Tunis explicitly decries this sort of covert healthcare rationing as obviously damaging and inefficient, and goes on to endorse a public discussion of rationing, with the aim of making it explicit and therefore less destructive. One suspects, on reading his comments, that a reason Dr. Tunis is no longer with CMS may be to avoid being repeatedly placed in the position of being an agent of covert rationing.

In any case, we see again in the ICD example an instance of the Fourth Corollary of the Grand Unification Theory of Healthcare: Covert rationing corrupts everything it touches. In this case, it corrupts the interpretation of medical science, and renders evidence-based medicine illigitimate. It is very difficult to trust evidence-based policy decisions when the “evidence” is being arbitrated by the payers - those who society has deputized to covertly ration our healthcare.

Posted in Wonkonian Rationing | 2 Comments »