This is Chapter 10 of my book-in-progress, “Open Wide And Say Moo! – The Good Citizen’s Guide to Right Thoughts And Right Actions Under Obamacare.” Comments are fervently sought; you can leave them here.

You can read my rationale for undertaking this project, and thus opening myself up to the possibility of public failure, humiliation, derision, disapprobation, and unwanted scrutiny, here.

And here is the up-to-date archive for all the chapters that have been posted so far.
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Chapter 10 – A Tyranny of Experts

I must preface this chapter with a confession. For nearly 12 years now I have made my living, for the most part, as an expert. During this interval various organizations have paid me for my expertise on cardiology, on electrophysiology, on the healthcare system, on product development, on quality systems, and probably on some other things I can’t remember right now. So what I am about to say, I say with some reluctance, and (considering that my current or potential future clients might read it) with a bit of trepidation.

Further, I must confess that some people who knew me during the 20+ preceding years, in which I made my living as a practicing cardiac electrophysiologist, have expressed their astonishment that anyone thinks I am an expert on anything other than pure electrophysiology. To these, I have patiently explained that I have always considered myself primarily an historian and an observer of human behavior, who picked up some electrophysiolgy along the way in order to pay the bills, similar to the way that (by analogy only) Jesus picked up carpentry, St. Paul tent-making, Albert Einstein patent-office-clerking, and Ted Bundy legal-aiding.

If this display of hubris does not shut them up, I go on to explain my definition of an expert: an expert is any person to whom any other person is willing to pay cash dollars for their thoughts and opinion on any topic. It is not my fault that some people are willing to reimburse me for my thoughts on stuff outside the field of electrophysiolgy. And so, fair and just or not, I am an expert.

Having made this disclosure, it pains me to note that, in general, experts have become a problem.

Experts are a natural spin-off, an unintended consequence if you will, of the Age of Reason, an era which Western Civilization has enjoyed now for about 500 years. During that time, the concentrated application of reason to the human experience has brought us many good things, including Newtonian physics, classical liberalism, public education, renal dialysis, air travel and iPhones, among several others. Along the way, human knowledge has exploded into so many different areas that nobody can possibly learn it all. And hence we have developed an essential need for experts – people who have learned a whole lot about some circumscribed region of human knowledge.

Indeed, experts have become so indispensable that over the last century or two they have risen to the top of the food chain. Generalists – people who have broad knowledge but no specific, recognized areas of expertise – have become greatly devalued in Western society. Polymaths are passe. And so, an unintended consequence of the Age of Reason is that the experts have risen to power.

Anyone who has read this far in this book will know that your humble author (being a classical liberal) believes that most big decisions affecting individuals ought to be made by the individuals themselves. To the extent that certain big decisions must be made on a collective basis (and some decisions do need to be made this way, which is why we need governments in the first place), I believe those decisions ought to be directed by people who have a broad depth of experience, and who have broad knowledge, and who take a broad view. I am partial, for instance, to Jefferson’s notion of citizen-legislators.

When Jefferson lived, about half-way through the Age of Reason, it was still possible to imagine such a thing. But he lived before experts actually ran everything.

The Problem With Experts

There are inherent problems with experts running the show.

Experts, by definition, have a circumscribed and insular view of things. They know a lot about one area of endeavor, which is fine – but they take great pains to know “nothing” about any other areas. If they attempted to display a broader knowledge, they would be encroaching on the turf of some other expert, and therefore, they would be threatening the very notion of an expertocracy. So (similar to the way a union plumber will call in an union electrician to screw in a light bulb) experts by general agreement stick to their own areas.

Therefore, a system run by experts is a system of fiefdoms. Decisions are taken on the basis of the internal logic that best suits each fiefdom, and not necessarily any other fiefdom, much less the whole. We should not be surprised, therefore, when the system taken together often works against itself, or when individuals trying to function within the system of fiefdoms experience unnecessary and often gratuitous harm.

Experts in power do not seek answers, they know the answers. They know because they are experts. If they were seen to be seeking answers, they would not be experts any longer and their power woud slip away.

This is one of the facts that allows us to distinguish between “scientists” and “experts.” Scientists are always skeptical, always doubting, always seeking new answers that are better than the old answers. But once a scientist is elevated to the level of expert, and is placed into a position of power, all that changes. Climate scientists, for instance, are still trying to clarify the role of human activity in climate change; whereas the climate experts who issue public decrees have already made a final determination on the matter, and have declared the science to be “settled” (a concept that actually does not exist in real science). Clearly, expressions of doubt and skepticism are an acknowledgement that you do not actually have the answers. And if you do not have the answers, why should you have the power?

Experts in power almost invariably operate under a cloak of secrecy, because transparancy threatens experts in several ways. Too much openness might lead non-experts to gain sufficient knowledge to believe they can make their own decisons. Worse, transparency might cause non-experts to question whether the experts are truly acting objectively, or with perfect knowledge. Openness might make the answers the experts provide seem less oracular, and more like educated guesses or political expediencies. So maintaining as much secrecy as possible is very important to experts.

The thing that is the most dangerous to an expert in power is criticism. Fundamentally, criticism is a questioning of their expertise, that is, of their right to power. Thus, criticism is more of an existential threat to experts than it was to, say, Louis XIV, and it must be dealt with that much more severely.

What all this means is that once experts are in power, their attention quickly turns away from the subject matter of which they are supposedly experts, and toward the processes necessary for retaining power. Experts in power, therefore, quickly become primarily concerned with the process and methods necessary for holding on to power, and not with content.

Maintaining secrecy and managing critics are key to this endeavor. Their tool of choice is controlling the language. Because they are the experts, they get to say what things mean. They define terminology that is sometimes charged, sometimes soothing, sometimes complex, but that always stifles what the masses would call common sense, and that allows the experts to make their arguments in terms that are too bland or too meaningless to dispute. For extra insurance they invent lists of phraseologies whose utterance, they insist, will do great harm to society, and thus which must be strictly forbidden.

Because process is the work product of experts, they naturally create complex systems and tangled infrastructures whose purpose and organization only the experts themselves can possibly pretend to understand. The complexity itself is a powerful tool of control. Outsiders who manage to breach their walls find themselves unmanned within a structure that is incomprehensible, and whose denizens speak an alien tongue.

If secrecy, language control, and complex processes are not sufficient to protect their power, experts will of course resort to whatever means prove necessary. That prerogative, obviously, is the main advantage to having power in the first place.

If any of this is seems familiar to readers of the classics, it may be because it is a fair approximation of the methods of Machiavelli. Machiavelli was the first proponent, at the very beginning of the Age of Reason (the The Prince was written 500 years ago), of the application of reason to the achievement and maintenance of power. His methods were notable at the time for being completely devoid of underlying ideology. Pure reason, it turned out, could be applied in the service of any ideology you like.

So process became everything; content became flexible. Ignatius Loyola was effective in almost single-handedly stemming the tide of the Reformation precisely because he applied the methods of Machiavelli in the service of the Church (the content here being Catholic doctrine). His instructions to his Jesuits may sound familiar many of us who live in an era of expert control. They included an admonition to eliminate “people infected with error” from positions of authority and from the profession of teaching; orders to burn books declared heretical; orders to shun and castigate books that are not themselves heretical, if they are written by authors believed to have heretical thoughts; and orders to convene synods (official investigations) to root out errors in thought, and the people who have them.

In fact, as time went by and the processes of control became more sophisticated, content proved so flexible that it eventually became optional altogether. Progressivism – an ideology that simply aims to develop a perfect society – is so devoid of actual content (i.e., of a fixed ethical underpinning) that it has become a virtual ideology of expertise itself. Experts (the ones who can direct us to societal perfection) are not only the means, they are very nearly the primary idea of Progressivism.

So it should not be surprising that in the practice of herd medicine which will be instituted in our Progressive healthcare system, all the decisions regarding which medical services are to be supplied to members of the herd, and which are not, will be rendered only by the very best, and very brightest, experts.

Who Are These Experts, Anyway?

Many of the experts who are now running things were never trained in any particular subject matter at all (such as, for instance, classic literature or geology), but rather, were trained from the very beginning to become experts. Our leadership class tends to study disciplines like political science, or public policy, or government – disciplines whose main content is expertise itself. Our future leaders are groomed with great care and tenderness primarily in the methods and processes one must employ to function effectively as an expert – as one of those elites who will control the process of making all the important decisions for the rest of us (whatever the subject matter of those decisions turns out to be).

Despite the primary importance of expertology, sometimes one must rely on “second-level” experts, that is, on people who have some degree of knowledge or proficiency in a particular area of endeavor. This is likely to be the case when it comes time to appoint the expert panels that, under Obamacare, will be making collective decisions regarding our healthcare.

The trick for our leaders will be to identify second-level experts whose credentials, on paper at least, will allow them to be passed off as legitimate subject matter experts, but who also have the right ideas – and the right enthusiasm – regarding the great benefits of herd medicine.

I do not think it will be difficult to identify such people. Seats on the expert medical panels will be positions of the highest authority, and will thus be very desirable. And, as one might predict, these positions are being vigorously pursued. Indeed, we are seeing candidates audition for these expert panels with efforts ranging from amateurish to ruthless. It puts one in mind of the early-season contestants on “American Idol.”

We see would-be experts vociferously extolling, in every public venue they can find, the idea of “fly by wire” medicine, whereby every decision physicians make will be determined not at the bedside by flawed individuals, but by the best and the brightest experts, acting at a distance. We see them promising to distribute rules of action based on only the best scientific evidence (“best” being determined by those selfsame experts), and insisting that the directives they hand down will be models of actionable simplicity, spelled out so unambiguously that even doctors born, raised, and trained in the Midwest or the South will be able to follow them. We see them writing scientific papers that spin the evidence in such a way as to generate conclusions which will be soothing to the Central Authority. We see them editing medical journals in order to make certain that the correct conclusions are published, and the incorrect ones are not. We see them taking control of professional organizations, and using their positions to promulgate changes in medical ethics that advance the Borg-ification of medicine, and to formally endorse Obamacare on behalf of American physicians who, for the most part, were against doing so.

These panelist-hopefuls are everywhere. They have gained great prominence within our healthcare system, and practicing physicians will be dealing with them and the consequences of their actions for many years to come. While the natural impulse of the typical American doctor might be to simply marvel at the wonder of it all, shake their heads resignedly, and go about their increasingly distressing business, it may behoove us members of the herd to take a closer look at these individuals, to attempt to understand them a little better. After all, their activities in the near future promise to greatly impact our lives and our fortunes.

So – who are they, anyway?

This, dear reader, is where the Progressive mode of thought comes in handy. I refer, of course, to the Progressive doctrine of Diversity. Divertity allows us to attribute certain stereotypical characteristics of thought and action to certain groups of people, without much regard for what individuals within that group might actually think or believe, and to do so within the perfect cover of political correctness. While in general I do not approve of Diversity as it is being practiced today, as it happens the concept might be useful in attempting to answer the question at hand.

Specifically, I refer to the theory that physicians (like any humans) tend to end up in careers that best suit their underlying personalities and proclivities, and so physicians in a given specialty will tend to think and behave like other physicians within that specialty, and unlike physicians in other specialties. If this theory has any merit (and let us call it the Diversity Theory of Physicians), it will allow us to make some generalizations about the characteristics of individuals who have chosen specific kinds of medical careers.

Let us examine some ways in which the Diversity Theory of Physicians reveals Truth. An obvious example is the specialty of psychiatry, which tends to attract doctors who are, perhaps subliminally, concerned that they are just a little crazy themselves. As it happens, it often turns out they are correct. In my own experience, and in the experience of just about anyone who has encountered more than a handful of shrinks, these fine physicians, on average, display an astonishing degree of off-the-wall psychopathology. (Not that there’s anything wrong with that.)

Emergency room doctors have short attention spans and are afraid of commitment.

Endocrinologists get their jollies sitting alone in cramped offices, studying thick volumes of laboratory data from blood tests, which they claim reflect moment-to-moment variations in hormone levels, and from this arcane evidence are able to parse out (so they say) subtle glandular difficulties. If endocrinologists were not physicians they would be accountants.

Orthopedic surgeons are former jocks, or wish they were, and the ones who end up replacing hips in old ladies instead of patrolling the sidelines at college football games are often very frustrated individuals.

Party animals who manage to gain entrance to medical school often end up as anesthesiologists.

Cardiologists would like to think of themselves as the extreme sportsmen of medicine. They like to relate to each other stories of how they put catheters into damaged coronary arteries in patients on the brink of heart attacks, and, through their skillful manipulations, open those arteries and save lives. They live on the edge, they would have us believe. But in reality their jobs are ones of relative security, predictability and instant gratification. What they do in the cath lab actually is pretty rote, and it provides them with the immediate, concrete results they crave. And any time fixing a particular artery looks a little too risky, they call a cardiac surgeon right away. This pattern of behavior suggests that their aggressive personnas and glory-seeking activities are actually masking an underlying insecurity.

It would not be fair of me to psychoanalyze all these other specialists – who have done nothing to provoke me – without also doing the same for electrophysiologists. To understand electrophysiologists, one must invoke the principle of sublimation. To sublimate is to channel an underlying negative tendency toward some activity that partially gratifies that tendency, but that is considered worthwhile by society. So, for instance, people with a tendency toward pyromania may become volunteer firefighters. People with sadistic tendencies may become prison guards. Foot fetishists can become shoe salesmen. And compulsive liars can become novelists. Who, then, becomes an electrophysiologist?

Back in the 1980s and 1990s, when I was still in practice, what electrophysiologists mainly did was to try to prevent sudden death in patients who had a high risk of dying suddenly from cardiac arrhythmias. And in order to find the optimal therapy for these patients, it was necessary to induce, intentionally and repeatedly, cardiac arrests in their patients. This was done in an effort to find an antiarrhythmic drug that would prevent the induction of cardiac arrest. This behavior we euphemistically called “serial drug testing.” Fortunately, this procedure is no longer necessary, since the implantable defibrillator is now widely available for high-risk patients.

While it has been widely remarked that those early-day electrophysiologists were a very strange group indeed, most of us who did that work ended up successfully absorbed into normal society, and today (as far as I can tell) we are for the most part generally pretty harmless. But sometimes I find myself wondering what might have become of some of us (some in particular more than others) if we had not had this remarkable opportunity to sublimate what one might speculate to be some rather unpleasant tendencies. And what is to become of that young person today who has whatever those unfortunate tendencies might be, and who, 30 years ago, might have found release as an electrophysiologist? One must not think too deeply about this.

Let us now, finally, turn our attention to those would-be experts who will soon be serving as government panelists, and see if we can decipher what kind of people these might be.

These are the kids you knew in college who studied all the time and got straight A’s in all the hardest courses, buttered up their teachers, then aced their MCATs. For them the hardest part about applying to medical school was deciding which of the many schools that accepted them they should attend. Likely, they chose one of the Ivy League ones. Their first two years of medical school – the didactic years – were much like their college experiences. They studied hard, aced all the exams, and were generally acknowledged by both faculty and peers to be at the very top of their class.

Then they reached their clinical years, and things changed. They still knew more information than anyone else, and in fact their information base continued to expand. They read all the journals, and could always quote new research findings chapter and verse. They could conjugate the Krebs cycle on demand (or whatever it is you do with the Krebs cycle), and could recite precisely which enzyme that new heartburn drug inhibited, and could say why doing so made it OK to eat pizza again.

But what they could not do was be a good doctor. They had no instinct for it. They had no ability to get patients to tell them the important information; no ability to read a patient’s facial expression, or phraseology, or body language, those signs that reveal the real truth. They had no ability to pick out and assemble the truly useful information from the flood of partial and contradictory clinical evidence that is always pouring in from several sources. When time was of the essence, they had no capacity to figure out what was going on or what they should do about it. They could not adjust to constantly changing clinical situations on the fly. In an emergency they were paralyzed, trying to match the quickly evolving situation in front of them with the static words on the printed page. And often they were klutzes.

They were perfectly cut out to learn medicine, but lousy at actually doing it. What was worse, some of their colleagues who were mediocre in the book-learning department suddenly blossomed into highly competent clinicians on the wards, and quickly became recognized as rising stars by attending physicians, while they themselves were repeatedly chastised, or ignored.

And it just wasn’t right. It just wasn’t fair. They had worked harder than everyone else, had twice the brains of their colleagues, and had learned the material three times as well. But the way God set it up, they just weren’t good doctors.

Many of these unfortunate souls quickly left clinical medicine, and branched off into research, academics, or administration. Most of them did quite well for themselves, because they really are very smart. But they never really got past their frustration and anger over their unjust failures on the clinical wards, a place where their obvious inferiors lorded it over them. They have now spent years engaging in cognitive dissonance, convincing themselves that their apparent failure was an illusion, merely a sign of having been subjected to the anti-intellectual, shoot-from-the-hip, do-it-quickly-and-make-more-money environment that is American healthcare. After all, how could they be sub-optimal physicians when they are clearly far more intelligent and knowledgeable than the supposed “stars?” If the healthcare system had been arranged differently, in such a way as to make the cowboys behave the right way, they would have proven themselves to be the best clinicians in the land. It is a bitter, bitter pill.

These are the men and women, I submit, who are chomping at the bit for the opportunity to sit on the Central Authority’s expert panels. They would dearly love the chance to utilize their superior intellectual firepower, to distill the clinical research data, to digest it painstakingly and thoroughly (not haphazardly and on the fly like those others), to put down on paper the right way of practicing clinical medicine – and to have the authority to do it in such a way (backed up by the full force of the government) that those lesser doctors will have to do it their way, at long last.

The point of all this psychoanalytic guesswork is to suggest that the expert panelists, even the expert panelists who are physicians, will have no sympathy for the idea that the practice of medicine should be individualized to any degree at all, or that skill in “reading” patients’ faces, or instinct, or (above all) experience, or any other non-objective and irrational methodology, should play any role whatsoever in the practice of medicine. The idea of individualizing medical care, rather than practicing by formula from a book, is what caused these people the most uncomfortable moments in their professional lives. Far from being sympathetic to the idea, they will probably be more hostile to it than the non-physicians on those panels. When some non-physician panel member suggests that, perhaps, we should give the doctor a little more leeway on this or that particular issue, these expert physicians will speak up and say, “Listen. I’ve been there and you haven’t. These doctors don’t need any more rope, unless it’s for us to bind them even tighter.” They were themselves shown no quarter, in the tough arena of clinical medicine where outcomes (and not process or book knowledge) is the only mark of success, and they will offer none in their turn.

I obviously cannot prove any of this. I am merely giving an educated guess based on my own personal observations and prejudices, having observed many of these whiz-kids in my 25 years of teaching medical trainees, and watching where they wound up. I could, of course, be wrong.

I hope so.

In any case, having considered the general question of the advisability of placing experts in positions of power, and having speculated on the kind of person who most likely will end up on the Central Authority’s expert medical panels, let us now take a brief look at the damage experts can do to the public welfare when they are placed in charge of health policy. Unfortunately, we already have a few striking examples we can study. And studying these examples might be useful for those of us in the herd, so we have some small idea of what to expect.

Medical Experts and Dietary Fat

The Central Authority is quite exercised at the moment over the obesity crisis they perceive – a crisis which we in the herd have brought upon ourselves through our sloth and gluttony, to the great inconvenience of our enlightened leadership. What the Central Authority fails to note (publicly at least) is their own central role in creating the obesity problem. They did it with their war on dietary fat.

An association between dietary fats and coronary artery disease was first noted in the 1950s. In 1957, the American Heart Association (AHA) published its first, tentative recommendations for limiting the consumption of saturated fat. The recommendations were pointedly aimed only at people who had a strong genetic predisposition to heart attacks or strokes, or who already had heart disease. An accompanying editorial by Herbert Pollack, in the August, 1957 issue of Circulation, specifically warned against the widespread application of any policy restricting saturated fat:

“Altering the dietary habits of a large population group is fraught with a great many dangers. Our knowledge of nutrition is not sufficient at this time to anticipate what ultimate results would happen if the public were encouraged to alter radically their basic dietary patterns.”

The AHA’s recommendations regarding saturated fats received sparse attention for nearly 20 years. Then in 1977 our government, having won the war against hunger, turned its attention to the opposite problem (where it remains to this day). At that time, during another notably Progressive administration, the Senate’s Select Committee on Nutrition and Human Needs, chaired by George McGovern, nationalized the question of avoiding dietary fat. After holding a series of hearings on the relationship between fat consumption to heart disease, the Committee published the first “Dietary Goals in the United States,” advising all Americans to cut back on all fat consumption. With this report, the US government for the first time officially endorsed a particular type of diet – a low-fat diet – for everyone.

The Committee took this stance (on behalf of the Central Authority) despite warnings that were raised at the time by several nutritional scientists, who pointed out that the data establishing a causative role of animal fats in coronary artery disease was circumstantial at best, and further, noted that even if saturated fats turned out to be “bad,” there were plenty of other fats that were healthy, and which Americans should take pains to consume. But the official experts who were advising the Committee strongly objected to any such warnings, and insisted that the science on the matter was sufficiently settled to justify universal dietary guidelines for the whole population. Furthermore, they said, trying to educate the bovine masses on the differences between good fats and bad fats (assuming there was such a thing as good fats) would obviously be impossible. The public was too dim for such subtleties. The Senate Committee followed their experts, because experts know the answer. Accordingly, Committee opted for the far-simpler “fat is bad” message that you can sell even to gun-toting Bible-thumpers.

The anti-fat movement got its next big push in 1983, when the Framingham study published a landmark paper tagging obesity as an important risk factor for cardiac disease. This new evidence allowed the experts to reason thusly: If the people are getting fat, it must be because they are eating too much fat. It is therefore plain that that low-fat diets will prevent heart disease both directly (as they had already decreed in 1977), and now, indirectly (by preventing obesity).

Accordingly, in 1984 the NIH assembled by a group of scientists and experts which subsequently issued a Consensus Statement entitled “Lowering Blood Cholesterol to Prevent Heart Disease.” This document was an all-out, government-sanctioned, expert-led attack on dietary fat. Again, several of the scientists the NIH had invited to the conference argued that there was a lack of convincing evidence demonstrating that low-fat diets would be healthful. But the true experts, seeing an epidemic of heart disease which must surely be due to fatty diets, carried the day, and the Consensus Statement was voted into publication.

Shortly thereafter the AHA also endorsed this Consensus Statement. Finally, everything was in place for a major campaign across the land for low-fat diets for everyone.

The great low-fat diet era was ignited. Prestigious medical organizations spurred a campaign of public service announcements and media blitzes promoting the need to avoid fats in the diet. Influential magazines (that is, magazines read by women) began a prolonged onslaught of low-fat diet tips, articles, and human interest stories emphasizing the deadly nature of dietary fat. The food industry, which was at first very skeptical (just like the banks were when subprime mortgages were initially foisted upon them by government policy), finally jumped in with both feet (again, like the banks). A massive new product line of low-fat and no-fat snack foods was invented. These, of course, were just packed with carbohydrates, and also with the supposedly “healthy,” man-made trans fats (more on this in a moment). This tsunami of change in America’s processed foods has been referred to as the “Snackwell phenomenon.” And, as if to put an exclamation point on the utter goodness of it all, the AHA, tapping into a lucrative new revenue source, began officially certifying these low-fat, high-carb products (including items such as Frosted Flakes and Pop-Tarts) as being “Heart Healthy.”

Americans, however, are filled with the milk of human nature. So they largely ignored the ubiquitous pleas to abandon their burgers, pizza and tacos in favor of broiled, skinless, sauceless, saltless chicken breasts and broccoli. But they did begin scarfing up all those the new-age low-fat snack foods in massive quantities, having been assured that, as long as the snacks contained no fat, they could eat as much as they wanted.

There are a few physiological facts about dietary carbohydrates that the experts chose to largely ignore during the low-fat era. First, the body greedily converts dietary carbohydrates into massive stores of adipose tissue, so indeed you can readily become fat by eating carbs. Second, gorging on the refined carbohydrates found in these new “healthy snacks” causes big spikes in insulin levels (insulin being a key factor in converting excess carbohydrates to fat). When the insulin levels suddenly drop a couple of hours later, that drop produces insatiable hunger. So, two or three hours after enjoying a fat-free Pop-Tart or a Snackwell cupcake, one finds oneself desperately ripping through the cupboards to find another carbohydrate fix. By thus inducing a continuous-snacking mode, the new high-carb snack foods increased the overall caloric intake of many of the people who began eating this stuff, far beyond the additional calories listed on their labels. Third, diets high in refined carbohydrates increase triglyceride levels, reduce HDL cholesterol (“good” cholesterol) levels, and in general create lipid profiles that are likely quite damaging to the arteries.

So, while few people actually stuck to a strict low-fat, controlled-calorie diet (and to this day we still don’t know whether doing so is actually a particularly good idea), many more people became addicted to the AHA-endorsed refined carbohydrates that were officially associated with low-fat diets, and as a result, they became obese.

It has only been in the past ten years or so that the low-fat dogma has begun to moderate, largely thanks to the (now mercifully faded) low-carb craze that struck at that time. We now hear somewhat more reasonable advice about good fats and bad fats, and good carbs and bad carbs. But much of the damage has been done. The damage occurred because public health experts made a conscious decision to change Americans’ dietary habits, despite clear warnings that the evidence for doing so was shaky at best. At least partly because of the major push for low-fat diets, we Americans are fatter and less healthy today than we used to be.

The Central Authority’s low-fat diet policy amounted to a massive public health experiment, with the research subjects being us. Our government and our expert-led medical organizations have yet to apologize for subjecting all of us to this travesty.

The Trans Fats Two-Step

In the 1980s, coincident and associated with the adoption of the low-fat diet policy, experts also saw to it that the “deadly” saturated fats in processed foods were replaced with the completely benign, inert, man-made variety of fats known as trans fats.

Almost all the trans fats we find in our in food is man made. Trans fats come from an industrial process that partially hydrogenates unsaturated vegetable oils. The process of partial hydrogenation solidifies liquid vegetable oils, and makes them stable for long periods of time. (Liquid vegetable oils go rancid relatively quickly, and are not suitable for processed foods with a long shelf life.)

For many decades trans fats in American diets were largely limited to the use of Criso, a shortening used for baking. Trans fats did not replace saturated fats in processed foods, for the most part, until the 1980s. It happened in the 1980s, of course, because of experts.

When the Central Authority declared its holy war on fats in 1984, an organization of food experts and food activists dedicated to stamping out saturated fats – the Center for Science in the Public Interest (CSPI) – took that as a signal to launch a major (and apparently well-funded) campaign to coerce the food industry to abandon saturated fats in all processed foods, in favor of trans fats. Trans fats, the CSPI experts declared, were entirely harmless, and by insisting on using deadly saturated fats instead of trans fats, the food industry was killing us all. The food industry largely capitulated to the CSPI’s campaign in 1987, and rapidly moved almost entirely to using trans fats.

The actual safety of trans fats in humans, however, was questionable even then. Indeed, because certain scientists were attempting to call experts’ attention to data suggesting that trans fats are actually quite harmful to vascular health, in 1988 experts at the CSPI felt compelled to write a major defense of trans fats in an article called “The Truth About Trans.” This article strongly defended trans fats as being completely safe for humans, despite growing warnings to the contrary. The CSPI widely distributed this article to experts and decisionmakers (such as legislators), and for a year or two the organization seemed very satisfied with itself.

Unfortunately clinical data continued to accumulate showing that trans fats, far from being benign, likely caused more vascular damage than saturated fats. By 1993 the CSPI could no longer ingore this mounting evidence, and did a complete about-face. It launched an indignant campaign demanding that the food industry remove these deadly trans fats from all food products. Their turnaround was artful. It was accompanied by a whitewash of the CSPI’s very recent history relative to trans fats (i.e., that they were largely responsible for the widespread use of trans fats in the first place). A sympathetic press (sympathetic because the CSPI was, as always, attacking evil corporations for killing Americans in the name of profit) let them get away with their revisionism.

We can give the CSPI experts credit for being willing to shift course so soon after their seminal victory. But we should also note that they displayed stereotypical expert behavior during this episode. In 1987 they insisted they had the right answer, despite warnings from scientists who had credible evidence that their “answer” was wrong. And, once the experts at the CSPI reversed course in 1993, they never again acknowledged their pivotal role in having trans fats placed in our food supply, nor did they express any remorse for it. Likely, they never felt any remorse. Rather, they almost certainly believed they were successful both times – when they wanted trans fats placed into the food supply, and again when they wanted them removed. For experts, process (and not content) is the important thing. And the process worked well on both ends of the trans fats episode.

This orientation toward process is very convenient for experts. When the content of their endeavors turns out to be a horrible mistake, they simply re-orient their processes and move on as if the mistake had never happened. To outsiders it appears that when you are an expert, history always began 10 minutes ago. But to the experts, their history is simply a parade of one success followed by another.

Salt Wars

The misbegotten experiments that health experts foisted upon all of us by pushing low-fat diets on us, and by demanding that trans fats be used in processed foods, cost billions of dollars, needlessly transformed large swatches of American industry, and likely produced significant harm to the citizenry. Far from being chastened, however, the experts are determined to continue inflicting us with their expertise, to the great benefit of us all.

Accordingly, without missing a beat, these same experts have now launched yet another experiment that recruits each of us within the herd as unwitting research subjects. And once again, it is an experiment that has a realistic chance of producing serious harm (despite the experts’ assurances that the science is settled and that only good can come of it). I speak, of course, of the new dietary guidelines regarding sodium.

Those new guidelines have been promulgated on the basis of these established “facts:” Sodium is bad. We all get too much of it. And if we restricted our salt intake to a much lower amount than we are likely getting today, we will all become healthier and live longer. Relying on this received wisdom, the new guidelines call for us to cut back to 2300 mg of sodium per day – unless we are 51 or older, or African-American, or hypertensive (and the majority of Americans fall into one of these three categories), in which case we are to restrict our sodium to 1500 mg per day.

For anyone who strays from eating only fresh fruits and vegetables, this kind of restriction is likely to prove a challenge. A nice bowl of dry cereal, for instance, even before you add milk, may give you up to 1000 mg of sodium.

Some Americans might consider such severe restrictions to be merely a statement of an ideal, as if the Central Authority were saying, “It sure would be nice if you could keep your sodium intake down to these levels. It might do you some good. So please do the best you can.” But this is not at all how the Central Authority is viewing the matter.

The experts over at the Institute of Medicine, for instance, recently published (in conjunction with the new Guidelines) its “Strategies To Reduce Sodium Intake In the US.” Noting that public health experts have tried in vain for decades to get Americans to cut back on salt, the IOM says the time for persuasion and education has passed. The great unwashed are proved to be recalcitrant, yet again, to reason and science. It’s time to take the gloves off. So the IOM calls for the US government (specifically, the FDA) to use its regulatory firepower to enforce – once and for all – the kind of sodium restriction that the public welfare demands.

Specifically, the IOM calls for the FDA to reclassify “salt” from a food ingredient categorized as GRAS (“generally regarded as safe,” i.e., items which have been used for millennia in food preparation without regulatory oversight, such as pepper, parsley, or vinegar, and which are accepted as being harmless), to a “food additive” (i.e., a substance which is certifiably harmful, and for which strict, enforceable rules must be promulgated regarding its use). Re-classifying salt as a food additive will give the FDA the authority it needs to enforce its usage (as with any other regulated substance) in the food processing industry, in restaurants, and even, one must assume, in the home. With this new designation, the FDA (and other government agencies) will be able to deploy whatever regulatory and enforcement muscle they must, in order to assure that the Guidelines for sodium are at last realized.

This is serious stuff. The Central Authority seems dedicated, as never before, to actually implementing a significant sodium restriction for all of us within the teeming masses. All, of course, for our own good.

You might think, if you have not been paying attention, that in order for experts to insist on such a severe across-the-board sodium restriction, the scientific data to support this action must be pretty airtight. But if you have been paying attention, you will not be surprised to hear that the actual advisability of restricting dietary sodium across the entire population is anything but settled. In fact, it remains very controversial among scientists.

There are at least three outstanding questions regarding the advisability of a universal salt restriction. Until these questions are addressed, the implementation of a generalized and severe sodium restriction across the population would seem, to any objective observer, to be quite ill-advised (and, of course, incredibly arrogant).

1) Does Sodium Restriction Really Do Any Good?

Books have been written addressing just this one question. Here I will simply summarize the problem.

The question hinges on the relationship of salt intake to blood pressure – that is, does higher salt intake cause the blood pressure to increase? This turns out to be a difficult question to answer with any scientific precision. The studies are difficult to conduct, and difficult to interpret. Accurately measuring sodium intake in any sizable population of patients is nearly impossible; and even measuring blood pressure (which varies tremendously from minute to minute, depending on activity, stress, and many other factors) in a reproducible way within a population of patients is extremely difficult.

Scores of studies have been conducted to try to address this question. And one can assemble from these a large group of studies which will show that salt intake correlates nicely with blood pressure. On the other hand, one can also assemble from these a large group of studies that shows it does not. And for decades, the salt vs. blood pressure question has been divided into two camps, each of which have major conflicts of interest*, and each of which invariably point to only those studies that tend to support their point of view.

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* In one camp are the National Heart, Lung, and Blood Institute, the National High Blood Pressure Education Program, the Institute of Medicine, and academic experts on hypertension whose careers have been based on funding from these organizations, and whose reputations and academic standing rely on sodium intake being a major determinant of blood pressure and health. In the other camp are the Salt Institute, the big manufacturers of processed foods, and sundry academic experts on hypertension whose careers have enjoyed funding from these sources. Take your pick.
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My own reading of the medical literature suggests that the population itself is divided into (at least) two types of people with regard to sodium and blood pressure: “salt sensitive” people, in whom sodium intake significantly influences blood pressure; and “salt insensitive” people, in whom it does not. Most folks appear to fall into the latter category. So, if we really wanted to use salt intake as a tool for controlling the populations’ blood pressure, it might be a good idea to recommend salt restrictions for “salt sensitive” individuals, but not for the majority. But it is inconvenient and impractical to determine people’s salt sensitivity, and besides, doing so would go against the principles of herd medicine. So the experts, in their wisdom, appear to have determined that the best way to restrict sodium in the people who are salt sensitive is to restrict it in everybody.

To see just how deeply politics is involved in the salt controversy, I highly recommend an article called “The (Political) Science of Salt,” by Gary Taubes, which appeared in 1998 in Science, and which outlines the incredible machinations that have been employed by the various interested parties in interpreting some of the complex studies that have attempted to correlate salt intake with blood pressure.

Our imaginary objective observer can only conclude that, at the very least, this is not a settled question.

But even if it were a settled question, and sodium intake did indeed correlate nicely with blood pressure across the whole population (and even legitimate herd medicine would require this minimum criterion before enforcing a universal sodium restriction), the degree of blood pressure reduction predicted by even the most vociferous sodium-restriction-enthusiasts, even employing drastic sodium restrictions, seems trivial. Most experts predict an average reduction in blood pressure of only 1-2 mmHg. The experts defend their universal salt restriction by arguing that this tiny reduction in blood pressure, on a worldwide basis, would save over 100,000 lives per year. But this argument is (scientifically speaking) hogwash. Such estimates are merely calculations made from strings of assumptions piled upon assumptions, and have little or no bearing on reality.

The fact is that we just don’t know what effect it would have on the population’s health to significantly restrict salt intake in everybody. We don’t know the magnitude of blood pressure reduction it would achieve, or the improvement in clinical outcomes that would follow such blood pressure reduction.

We could find out if we really wanted to – by doing a large, randomized clinical trial to test the hypothesis. But the experts have determined that such a randomized trial is not necessary because the science is settled, and besides, time is of the essence. (Astute readers will have noticed that when you are an expert, the science is always settled, and time is always of the essence.)

Our health experts would rather conduct a non-randomized experiment that enrolls every living American as an unwitting research subject. Then, in a couple of decades (reminiscent of the low-fat diet “experiment”), maybe we could figure out how it all worked out.

2) Does Sodium Restriction Cause Harm?

Here is a question that the health experts, who have revealed to us that salt restriction is an unalloyed good, really object to. For it questions their infallible pronouncements. It is, indeed, criticism. So they tend to get downright nasty when anyone brings it up.

But, as it happens, it is a legitimate question.

Sodium is extremely critical for any living creature. For any living cell to function normally, it must exist in an environment that contains, within a narrow range, just the right concentration of sodium. Consequently, living beings have evolved a complex series of mechanisms to assure an adequate sodium concentration under any and all circumstances. So, if animals are made to survive on a severely sodium-restricted diet, these homeostatic mechanisms are called into play to restrict the loss of sodium from the body. The stimulation of these sodium-retaining mechanisms can have many secondary effects.

In states of sodium depletion, tissues are more susceptible to injury from ischemia (lack of oxygen), a condition seen in heart attacks and strokes. Kidney damage caused by many types of medication will occur much more readily in states of sodium depletion. The way the kidneys handle various drugs is also altered when sodium intake is reduced, leading to potentially harmful changes in the blood concentrations of certain medications. The renin-aldosterone system is activated under salt restriction, which can have several adverse effects. (In fact, a major therapy for several medical conditions, such as heart failure and – ironically – hypertension, centers around suppressing the renin-aldosterone system.) Adrenaline levels and LDL cholesterol are increased when sodium is restricted. And at least one study, disturbingly, has correlated sodium restriction with an increase in cardiovascular mortality.

Calling attention to these kinds of findings just makes the sodium-restriction experts angry, and they usually respond by pointing out that so-and-so got a grant from the Salt Institute. (As noted, there are conflicts of interest on both sides of this fight.)

In 2011 alone, five new studies were published which question the safety of salt restriction for the whole population. One in particular, published in December 2011 in the Journal of the American Medical Association, suggests that when you compare cardiovascular events (such as heart attack and stroke) to sodium intake, the incidence of those events follows a “J” curve. That is, cardiovascular events are lowest at an “optimal” level of sodium intake. But if sodium intake goes above that optimal level – or if it goes below it – the incidence of cardiovascular events increases.

According to this study, the “optimal” level of daily sodium intake is 4000 – 5999 mg of sodium per day. Cardiac outcomes worsen for those with sodium intakes above or below those values.

As we have already noted, health experts are insisting on sodium intakes far below the 4000 mg threshold. Their recommendations would place everyone on an unenviable portion of the J curve, and (if this new study has any merit) would risk exposing all of us to an excess of cardiovascular disease.

Whenever a study appears that calls into question the advisability of a universal sodium restriction, the experts are quick to respond. In response to the “J curve” study, Heartwire (an online newsource for cardiologists) elicited the following response from Dr Graham MacGregor of London’s Wolfson Institute of Preventive Medicine (and a major sodium restriction guru): “[These new studies] are a minor irritation that causes us a bit of aggravation, and we have to talk to journalists about it, because they are not interested in news saying salt is dangerous.” MacGregor went on to insist that the need for a global sodium restriction remains a settled issue: “What [these irritating investigators] fail to understand is that the FDA is not asking for evidence about why salt should be reduced, they are asking how it should be reduced.” So new data is not needed, nor will it be heeded. It is all a settled matter.

At the end of the day, we have conflicting sets of observational data that can be interpreted to say different things. It may be true that a severe population-wide salt restriction would be a huge boon to mankind. But it may also be true that it would harm more people than it would help – or that it would harm and help about the same number, so the overall results would be the same.

The fact is, we just don’t know.

3) Is It Even Possible To Change Sodium Intake By Public Policy?

As we have noted, maintaining the proper sodium concentration in tissues is critical to life, so living creatures have evolved a complexity of mechanisms to assure that the concentration of sodium in the body remains within the proper range.

Among these mechanisms, it now appears, is an inherent “sodium appetite” enjoyed by all humans and all animals, an in-born mechanism that determines how much sodium an individual will ingest each day to help keep just the right sodium “set-point.” This sodium set-point is maintained by a complex neural network that is still being sorted out, involving several regions within the central nervous system, as well as inputs from the peripheral tissues. The bottom line is that one’s own physiology naturally regulates one’s sodium intake to satisfy the body’s needs.

Furthermore, studies of sodium intake across a wide array of human populations, living under a wide variety of conditions and dietary constraints, also show that the range of salt consumption humans take in to achieve their set-point is remarkably universal, and is maintained within a fairly narrow range. That is, not only do humans consume the proper amount of sodium as determined by the body’s needs, but across the diversity of humanity that “automatic” sodium intake is maintained within a remarkably fixed range. (Sodium intake moves within that range to maintain the body’s proper sodium set-point.)

As it happens, the lower limit of that universal, naturally occurring, “optimal” range of sodium intake is roughly 2300 mg/day.

By pure coincidence, this natural lower limit, determined by our physiology, is the same as the the upper limit our Central Authority would have many Americans consume. (The rest of the Americans will be consuming only up to 1500 mg/day, which is far below the natural lower limit.)

In other words, by decree, our government would have every American consume an amount of sodium that is below the optimal range (or at best, barely touching the optimal range), as determined by actual human physiology. Almost by definition, anyone living under the recommended guidelines would likely be unable to maintain proper sodium concentrations through sodium intake alone, and would need to recruit the secondary, sodium-retaining, potentially-harmful physiological mechanisms (such as the renin-aldosterone system) to keep sodium concentrations at an adequate level.

Furthermore, it seems to me that if we have a deep physiological need to satisfy our “sodium appetite,” and if the only food we can get will be (by the Central Authority’s decree) low-salt, then the only way we can satisfy our sodium appetite will be by eating more of it. In other words, an enforced policy of sodium restriction seems likely to worsen our obesity epidemic.

It is apparent that even if a universally-applied policy of significant sodium restriction was proved to be safe and effective, it may not be possible to make people comply with such a restriction. This kind of restriction will be fighting our inherent “sodium appetite” that has been forged through millions of years of evolution. This kind of restriction would appear to fly in the face of our human physiology.

We need salt, dear readers, we truly do. The only reason the Founders did not include an additional paragraph in the Second Amendment (to the effect that, “A palatable diet being necessary to the health and well-being of a free People, the right of the People to bear salt shall not be infringed,”) is that it never occurred to them that any government, anywhere, would ever attempt to restrict such an inherent physiological necessity.

Of course, anyone who has observed the Central Authority at work – as it attempts to implement policies that require fundamental changes in human nature, or that require the repeal of the basic laws of economics – should not be surprised at the notion that our Progressive leaders would also try to repeal human physiology.

We have already seen the harm that can be done when we allow public health experts to launch major, population-wide dietary changes, before adequately studying what their effects will be. Especially given the increasing evidence of the harms that might be done by it, we are nuts if we allow the arrogant expert class to enforce a salt restriction program on all of us, before we have completely studied its likely results.

A Tyranny of Experts

A major thrust of our new healthcare system is to implement herd medicine. Fundamentally this means empowering the experts to practice medicine, from a distance, upon the whole population. Urging caution or even a certain amount of circumspection on this newly-empowered expert class, as it begins exercising its much-sought and hard-won right to dictate American healthcare on a collective basis, is destined to be a futile exercise.

The health experts hold the high ground. For they are experts in a system that, if it worships anything, worships experts. They are the ones with the answers. Woe unto anyone who would stand in their way!

They are the ones who will give directives to doctors on the front line, and direction to the sundry health-related agencies of enforcement wielded by the Central Authority. Once they have formed an expert opinion the issue is settled, and it immediately becomes time – backed by the power of the Cenral Authority – to sweep aside any opposition, and implement the process.

As long as the process itself is successful, actual results visited upon members of the herd are not that important. Therefore, as far as the experts are concerned, their implementation of low fat diets was successful. Their incorporation of trans fats into our food supply was successful. With these fresh triumphs under their belt the experts have been validated, and they move confidently ahead to implement their new sodium restriction policy.

Armed with their infallible answers, they know only one word (a word we have heard before, and one that is being adopted again as a call to arms): “Forward!” If the herd suffers because of it, the experts will pretend not to notice.

For the herd will always be there, and the experts can always try again.

This is Chapter 9 of my book-in-progress, “Open Wide And Say Moo! – The Good Citizen’s Guide to Right Thoughts And Right Actions Under Obamacare.” Comments are fervently sought; you can leave them here.

You can read my rationale for undertaking this project, and thus opening myself up to the possibility of public failure, humiliation, derision, disapprobation, and unwanted scrutiny, here.

And here is the up-to-date archive for all the chapters that have been posted so far.
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Chapter 9 – An Introduction To Herd Medicine

Farmer Jones has 10,000 head of cattle in his beef herd. He prides himself in staying up to date on all the latest methods, so he knows that adding a certain antibiotic to his cattles’ feed will reduce the incidence of intestinal infections, and will increase his annual overall yield, measured in pounds of beef, by 7%. He also knows that, unfortunately, roughly one in 200 of his cattle will experience a likely fatal allergic reaction to the antibiotic. It is possible to do a blood test to determine which specific members of the herd are allergic, but the test itself is quite expensive, and the logistics of separating the allergic cattle at feeding time and providing them with their own antibiotic-free feed would be so costly it would entirely wipe out his potential savings. What should Farmer Jones do?

Obviously, the cost-effective solution is for Farmer Jones to give antibiotic-treated feed to all his cattle, accepting the loss of a few head as the necessary price for an impressive overall gain in productivity. He would be an ineffective and incompetent rancher indeed if he were to pass up this golden opportunity to achieve cost-effectiveness.

The Hazards of Herd Medicine

If you are a patient or a potential patient (and who is not!), you ought to be especially concerned about two particular hazards that are intrinsic to herd medicine. First, as demonstrated by Farmer Jones, medical decisions that are made on a collective basis rather than on an individual basis may succeed in improving the overall outcome for the herd, but often only at the cost of doing predictable – and avoidable – damage to certain individuals within that herd.

Second, since it is the overall health of the herd which is important, there will always be individuals within the herd whose very existence is seen by Farmer Jones as counterproductive. Individual cattle that are too scawny, too old, or are otherwise unlikely to prove profitable, are still consuming valuable resources and taking up valuable space. So under any system of herd medicine there will always be a natural temptation to cull instead of cure certain inconvenient individuals.

It is extraordinarily politically incorrect to mention this second point, and so I must apologize right away for having done so. Sorry.

In fact, Obamacare, so far, seems to have taken no overt steps in the direction of actively “culling the herd.” But the history of Progressivism, sadly, is not reassuring in this regard. Early Fathers (and Mothers) of Progressivism enthusiastically embraced eugenics as an attractive, science-based method for reducing the sort of undesirable citizens who so obviously hinder the achievement of a perfect society. Certain Progressive societies – led by doctors – have conducted the “humane termination” of people with various disabilities. And collectivist governments (admittedly usually out of frustration at the recalcitrance of human nature than out of any scientific zeal) have been responsible for the deaths of millions of people over the last century. So, if only to keep on the safe side, we members of the Obamacare herd ought to remain alert to any tendency toward culling behaviors. If our Progressive friends are as filled with the milk of human kindness as they insist, our vigilance in this matter may waste some of our time, but otherwise should do no harm. And accordingly, to help focus our vigilance (in order to render it more cost-effective), in later chapters I will point out certain aspects of American healthcare that seem particularly likely venues for culling activities.

In this chapter, however, I will concentrate on the less sinister but more universal hazard inherent to herd medicine – causing predictable and avoidable harm to individuals by insisting on making medical decisions collectively.

A Herd Medicine Hypothetical

Let us imagine that a large clinical trial has shown that a new cancer drug increases the mean survival in women with metatstatic breast cancer by three months. Unfortunately, the drug also causes some very nasty side effects, including some that can be fatal. And again unfortunately, this is one of those fancy designer drugs that cost over a billion dollars to develop, and is very costly to manufacture – so it is quite expensive.

A panel of experts, after carefully studying all the evidence, concludes that, given the relatively short improvement in mean survival, neither the risk/benefit ratio nor the cost/benefit ratio justifies approving the drug. The news media, while expressing sadness and compassion for breast cancer patients, solemnly concurs that the experts, of course, are right – that, while the drug has shown promise, it’s just not effective enough to justify the risk of side effects, or the cost of the drug. So better luck next time, with the next drug.

I think we must agree that it cannot be society’s duty to buy this new drug for all women with breast cancer. Under any publicly funded healthcare system that is run in fiscally sound manner (at least sound enough to avoid causing a catastrophic financial collapse), some line will need to be drawn, somewhere, regarding what expenses public funds can bear. And very possibly, a cancer drug that only extends the mean survival by three months may not make the cut.

In Chapter 4 we discussed the four possible methods for running a fiscally sound healthcare system. If we were under a Method Three healthcare system, where public spending is strictly limited but where individuals have the option of supplementing the public system with their own private insurance products, or even paying for desired healthcare services themselves, then many individuals would still have access to treatments like this new cancer drug, if they wanted to try it.

But under a Progressive, Method Two healthcare system, public funding is all there is. In this case one centralized coverage decision must fit all, and the result is herd medicine. Under herd medicine the new cancer drug cannot be approved, for anyone, once a panel of experts determines that its herd effect is insufficient to justify approval.

But determining the herd effect of a therapy (i.e., the average response to that therapy across a herd of patients), does not really tell the whole story.

Going back to our hypothetical, if you look at what actually happened in the clinical trial with our imaginary cancer drug, it turns out that very few of the women with breast cancer actually experienced three additional months of survival. Instead, some had a truly remarkable response to the drug, and are still alive a year or more after their predicted demise. In fact, it appears that a few might even have been completely cured. Some women, on the other hand, had very bad experiences with the drug, and side effects hastened their deaths. When you average all of these responses together, you get a mean benefit of three months.

But “three months additional survival” is not actually what we would expect to happen with most individual women who take this drug, and in fact this happened with relatively few of them.

In general, the reason people with cancer subject themselves to the ravages of chemotherapy is not to gain a few more weeks of life. The chemo itself often produces several weeks where life is barely worth living, so that would be a bad trade. Rather, they subject themselves to chemo on the hope – often a slim hope – that by doing so they are gaining some realistic chance at surviving for a long, long time.

If you were to give women with metatstatic breast cancer – an incurable disease that invariably causes death – the option of taking our hypothetical new cancer drug, some would opt for it and others would not. But in making their decisions, most of these women would not be thinking about the average of three additional months. Rather, most would be considering the fact that this new drug offers them some chance to beat back their cancer for substantially longer than that. They would be hoping to beat the average. They would be making the same calculus that cancer patients always make.

This new cancer drug represents a new chance at long-term survival, and faced with a fatal disease that is difficult to treat, taking that chance would have been a reasonable choice for many women – even though the drug produces only a tepid herd effect.

Herd medicine removes this option. When our hypothetical panel of experts decides not to approve this new drug – for anybody – what they have concluded is that, because the drug does not produce a sufficiently favorable effect across the herd, individual women should not have the option of using it. This is the only thing expert panels under a herd medicine paradigm can do. They cannot deal in nuances. They must determine whether a new therapy merits application to the entire herd, or to nobody.

Furthermore, if the answer is “nobody,” then the message the experts must convey – the only acceptable message they can convey – is that the new therapy simply doesn’t work. Either they will say it is ineffective, or that its modest average effect is completely negated by the risk of side effects. They cannot let on that the actual data suggests that some individuals will have a truly remarkable benefit from the drug, and that on an individual basis, deciding to take the drug despite the risks would not be unreasonable.

It is worth noting that as a general rule, progress in cancer treatment has been a slow, painful and incremental process. Very few therapies have been devised that have single-handedly led to major gains in survival. Rather, progress has come from a long series of small steps – improving the average survival by three months with this drug regimen, then adding another six months with another drug regimen, and so on. Once expert panels begin deciding that adding another three (or six, or nine) month increment to the average survival of the herd does not meet the threshold for approval – that is, once it becomes evident that only “home run drugs” are sure to be approved – then drug companies will become quite reluctant to invest in the development of new cancer drugs. And medical progress will slow drastically.

Herd medicine will remove individual choice, will take away hope, and will stifle the slow, steady progress we have made in treating some of the most deadly diseases we face.

Patients, Widgets and the Axiom of Industry

The hallmark of herd medicine is that it systematically and officially devalues the worth of the individual, essentially declaring that patients can be treated all alike, as if they are interchangeable members of a homogenous group. This devaluation of the individual, however, was not produced out of whole cloth by the Obamacare legislation. Rather, it is something that has been in the works for several decades, the natural, evolutionary result of a philosophy of healthcare that was all the rage until just a few years ago, but which – mysteriously – we seem to hear very little about these days. I refer, of course, to managed care.

Like many of the travesties that have taken place within our healthcare system, managed care began with a pretty reasonable idea; namely, to apply certain management principles to the healthcare system that have been used successfully in other industries, thereby injecting logic, organization, and accountability to what had been a bastion of disorganization and inefficiency.

The unifying idea behind managed care boils down to one word: standardization. Standardization is virtually a synonym for industry. In industry, standardization is the primary means of optimizing the two essential factors in any industrial process: quality and cost.

This proposition can be stated formally as the Axiom of Industry:

The standardization of any industrial process will improve the outcome and reduce the cost of that process.

If you had a widget-making factory, you would break your manufacturing process down into discrete, reproducible, repeatable steps and then optimize the procedures and processes necessary to accomplish each step. To further improve the quality of your finished product (or to reduce the cost of producing it), you would reexamine the steps, one by one, seeking opportunities for improvement. You would need to understand the process thoroughly, and you would need to collect data about how well the process works. But with the right information, you could almost certainly identify a few minor changes to improve the manufacturing process. The beauty in such a system is that you have only to make one change — to the process itself — and every widget that comes off the line after you make that change will be improved.

So standardization is good. It leads to higher quality and lower cost. Conversely, variation is bad. It reduces quality and raises cost.

Proponents of managed care argued that standardization should be just as useful in healthcare as it is in other industries. As medical care has traditionally been individualized, highly variable, and without any semblance of standardization, there must be a huge opportunity to improve the processes of care and to make them both cheaper and more effective. There is obvious merit in such an idea.

Perhaps the most direct, and the most successful, application of managed care practices to modern medicine was the adoption of “critical pathways” in the 1990s.

Critical pathways are blueprints for delivering standardized care to patients with specific medical problems. Consider a critical pathway for hip replacement surgery. The critical pathway is a specific schedule laying out which services are to be provided for the patient and when, from the date of hospital admission until the date of discharge (which is, of course, predetermined). Checklists are created itemizing which laboratory tests to order and when, which medications to administer at which times, and which specific complications to check for. Everyone involved in the patient’s care has their own relevant checklist. From the moment of the patient’s hospital admission, the critical pathway predetermines when to take vital signs, when to get the patient out of bed, when to begin physical therapy, and when to provide standardized instructions to the patient before discharge. Every vital medical service is included, and all extraneous medical services are omitted.

A “case manager” monitors the care each patient receives under the critical pathway. Every deviation from the prescribed procedure is tabulated as a “variance.” Variances are tracked not to decide who to punish, but to identify areas of the process that need improvement. If too many instances of a particular variance are seen in a critical pathway, then either medical personnel need to be retrained on following the pathway appropriately, or the pathway itself should be changed to reflect more realistic expectations.

Critical pathways, in fact, proved to be extremely helpful in managing many medical conditions. But of course there were some drawbacks and limitations.

First, critical pathways are only useful for delivering medical services, like elective surgery, in which the process of care can be broken down into a predictable series of discrete, reproducible tasks that generate reproducible results. In other words, industrial management tools only work when the process of care is similar to the process of making widgets.

Critical pathways are almost worthless when you are dealing with medical illnesses in which neither the diagnostic procedures nor the treatments that may be employed can be predicted or, therefore, standardized. For instance, it has proven impossible to develop workable critical pathways to manage patients with congestive heart failure (CHF). Knowing only that a patient has been admitted to the hospital with CHF tells you nothing about whether that patient will require cardiac catheterization, a stent, bypass surgery, valve replacement, a pacemaker, an implantable defibrillator, a mechanical ventilator, a prolonged and complicated stay in the intensive care unit, or just a couple of diuretic tablets and overnight observation. No two patients with CHF are exactly alike; and there is no such thing as a standard patient. Unfortunately, most non-surgical medical services fall into this category.

Second, it turns out that when you are taking care of patients, the Axiom of Industry simply does not hold true. Standardization does not always improve outcomes and reduce cost. The reason for this is: Patients are not widgets. And while in theory everyone seems to agree that patients are not widgets, the implications of this fact appear to escape many of our public health experts.

If you’re a widget maker, deciding between two manufacturing processes is a matter of economics. Nobody expects you to consider the widget itself. The outcome by which you are judged has nothing to do with how many individual widgets get discarded during the manufacturing process or even the quality of the widgets that pass final inspection. Instead, it’s the bottom line: how much profit you make in relation to whatever level of quality you put into the widget. So the quality of the widget is not necessarily maximized, instead it’s optimized, tuned to the optimal quality/cost ratio as determined by the market forces of the day. This is why, for a widget maker, the axiom holds: standardization, by rooting out variability, reduces the cost of making the widget (at whatever quality level you choose). This automatically improves the outcome, because the outcome the manufacturer cares about is overall profit.

If instead of running a widget company you’re practicing medicine, the calculus is supposed to be different. You’re supposed to be more interested in how things turn out for individual patients than you are in the bottom line. So an expensive process that yields a better clinical outcome is one most people (patients, at least) would expect you to use, even though it only gets you a healthier patient and doesn’t help your bottom line. A process that increases patients’ mortality rate by five percent is one you should disregard, even if it is substantially cheaper than the alternative. The clinical outcomes experienced by patients — the measure of success you’re supposed to be concerned about — may move in the same direction as costs, or in the opposite direction. But because you’re dealing with patients instead of widgets, the Axiom of Industry doesn’t hold – and outcomes and costs do not always move in the same direction.

So the push to strictly apply managed care techniques to healthcare created a dilemma for doctors. Doctors – the widget-makers in this scheme – tried diligently to apply standardized procedures such as critical pathways to the care of their patients. But the more un-widget-like the medical services they were providing, the more often they were compelled to make variances to the prescribed standardized process, in order to best serve their individual patients.

Such variances are a legitimate and valued aspect of any industrial process. In the widget-making world, variances reveal that the process needs to be tweaked to make it more usable. Variances lead to further iterations and refinements of the process, and a steadily improving result. Exceptions are what allow these industrial processes to become self-correcting.

But in the messy world of patient care, the variances revealed instead that industry-like standardization only works for a minority of medical services. No amount of tweaking can standardize the management of complex patients with complex combinations of illnesses.

It did not take long for doctors to simply stop attempting to use critical pathways for un-widget-like medical services. They did this because they actually cared about what happened to the individual widgets in their charge.

Similarly, it did not take long for our public health experts to recognize the same problem. From their standpoint, however, the problem was not that patients are not widgets. The problem was that the doctors on the scene cared about the widgets. Further analysis revealed that the root of the problem was that classic managed care techniques like critical pathways were administered locally, and therefore the misguided loyalties of the doctors on the scene were allowed to rule the day.

The reason we don’t hear about managed care anymore is that such terminology refers back to those locally-administered, iterative, self-correcting, continuously improving industrial processes. And our public health experts have now realized that this model does not work, and must no longer be encouraged.

The solution to the widget-makers dilemma is to remove the dilemma. Since a dilemma requires one to choose between two options, any dilemma can be resolved by simply removing the choice. And this is what has now been accomplished.

There is no dilemma for physicians any more. Clinical decisions are now to be made centrally, by expert panels appointed by the government, through the mechanism of what is euphemistically called “guidelines.” Guidelines are sacrosanct rules that will determine precisely who is to get what, when and how. Doctors are now enjoined, both by law and by their new medical ethics, to follow those “guidelines” to the letter, without exception.

So instead of the locally-controlled, iterative, self-correcting quality improvement processes like critical pathways – the same kind of processes that have so significantly improved American automobiles over the past three decades – under Obamacare we are reverting to a central-directive-style of management, far more reminiscent of the old Soviet collective farms.

Why the Experts Insist They’re Right This Time

Complex systems controlled by expert-generated centralized directives have never worked and never will. The fact that experts always seem to espouse such systems – apparently under the theory that they are so much more clever, or have better information, or better systems, than those other experts who tried before and failed – is just one of the reasons we should always be afraid of experts.

And sure enough, the experts who are going to determine which medical care we in the herd will receive (and not receive) do indeed have a new and infallible system – a magic bullet – upon which to base those decisions. They call it “evidence-based medicine,” which certainly sounds like a useful thing. And further, the “evidence” featured in this new formulation, virtually by definition, must come from a specific kind of rigorous study called the randomized clinical trial, or RCT.

Bias in clinical trials has long been recognized as a problem. All clinical trials are inherently biased. A research study is biased from the moment it is conceived. And those who conceive of, plan, conduct, and analyze the clinical study have every advantage. (This, indeed, is the very reason why everyone is so indignant about the studies conducted by medical industry and their minions in the medical academy.) That advantage of bias is now, under law, defaulting to the government’s expert panels.

The formulation which our leaders would have us believe is that first, such government panels will be completely objective and unbiased, and second, even if they were biased, the fact that they are basing all their decisions on RCTs will eliminate any possibility of acting on that bias.

The idea that government-controlled expert panels will be unbiased, of course, is absurd. The reason these panels exist in the first place is to control healthcare costs. Since the main mechanism by which these experts will drive a reduction in spending on medical services is through the application of clinical trials – whose results the experts themselves will officially interpret – panelists obviously will be strongly biased toward interpreting those results in a way that will justify withholding expensive medical services.

And while they are busily spinning the results of RCTs, the same experts will be assuring us that RCTs provide a guarantee against bias. For, according to the Gospel of the RCT, the chief advantage of this sort of clinical trial is that it eliminates bias altogether, and produces a completely objective result. So, in order to do the right thing, one merely needs to follow the results of RCTs.

This gospel is incorrect. An RCT, like any clinical trial, is inherently biased from the very beginning.

Many clinical researchers believe in their hearts and souls that bias can be eliminated through the use of RCTs. In such trials, “like” groups of research subjects are divided randomly into two or more groups, and each group receives (for instance) a different therapy, whereupon differences in outcomes among the groups are attributed to the different therapies to which they were randomized. Indeed, the widespread belief that RCTs are the necessary and sufficient means to achieve “clinical truth” has become so deeply ingrained within the medical establishment that when anyone (such as your humble author) suggests otherwise, he immediately reveals himself to be a scientific Neanderthal.

The widespread belief in RCTs has become nearly a Cult in the medical establishment, whose creed can be reduced to three main tenets:

1) Data derived from randomized clinical trials represents Truth.
2) Data derived from non-randomized trials represents Falsity.
3) If you don’t believe this, you are a heathen.

Objective observers should find it at least a little ironic that an attempt to claim the scientific high ground has so obviously resulted in a new religion, replete with its own dogma.

The sad truth is that the results of RCTs are invariably dependent on the bias built into their design, and even if internally they are statistically legitimate their interpretation can usually be twisted to suit one’s preconceived notions – and for these reasons RCTs, like any clinical trial, can often send us down the wrong path.

Those who design RCTs (the smart ones, at least) know this. Like smart trial attorneys, they know the answer before they ever dare to ask the question. So they tailor their “question” in such a way as to yield the answer they want to get. Indeed, if a lawyer should end up asking a question in court that produces an unexpected answer, he or she is completely incompetent and ought to be sued for legal malpractice. In more cases than one might think, the same is true for those who design RCTs.

For instance, if you are an insurance company and want to limit the use of an expensive therapy, you design your RCT so that patients likely to respond favorably to the therapy are diluted within a broad population of enrolled patients, many of whom are less likely to respond favorably. This tactic will tend to make the average response of the whole population quite unimpressive. (In many instances the clinical characteristics of the likely responders and the likely non-responders will be reasonably apparent to the study designers.)

On the other hand, if you are a drug company that wants to encourage the use of your expensive new product, you design an RCT that preferentially enrolls the relatively small subset of patients who are most likely to respond favorably. Once your product has gained approval through the results of your RCT, you can then trust the marketplace (with a tweak from your direct-to-consumer advertisements) to “extrapolate” the results to broader categories of individuals.

So it is immediately obvious that RCTs do not eliminate statistical bias, as the dogma suggests. Rather, they simply offer an opportunity to control the statistical bias in your favor.

Sadly, it is often child’s play for interested parties (both government and private) to twist and spin RCTs to create the desired impression. The conceit of Obamacare – that industry-sponsored research is invariably biased, while government-sponsored (or government-interpreted) research is entirely objective, and therefore, that the only thing we need to assure accurate clinical research is to have it all controlled by the government – is dangerously wrong.

Since all clinical research entails bias, the appropriate way to approach any clinical problem would be to acknowledge that neither RCTs nor any other kind of clinical trial will reliably distinguish between Truth and Falsity, and that no (inevitably conflicted) group of experts should be given the exclusive authority to interpret clinical results. Then, given the possibly competing results from various studies – which often will not yield a firm “answer” – the individual doctor and individual patient can weigh the evidence and review list of risks and benefits most pertinent to that patient, and determine the optimal course of action given that patient’s particular circumstances and proclivities. Driving such a process, in fact, is what doctors are supposed to do.

But herd medicine does not allow for such individualized decisions, nor does it allow that there may be grey areas in clinical medicine, or that what’s right for one patient may not be right for another. Instead, it insists that RCTs must yield the Truth, that panels of very smart experts can discern that Truth, and that these panels can determine the one Right Answer that is applicable to the entire herd.

In the next few chapters I will demonstrate more specifically how expert-driven herd medicine can cause extreme harm to individuals, and to our society. I will finish this chapter by showing a recent example of how an RCT, even a straightforward one, can be twisted quite easily into a pretzel by biased interpreters.

Spining an RCT In Order To Shed Inconvenient Results

In 2010, the Archives of Internal Medicine published four (four!) articles assaulting the legitimacy and the importance of the JUPITER trial, a landmark clinical study published in 2008, which showed that certain apparently healthy people with normal cholesterol levels had markedly improved cardiovascular outcomes when taking a statin drug.

Superficially, at least, the JUPITER study appears to have been pretty straightforward. Nearly 18,000 men and women from 26 countries who had “normal” cholesterol levels but elevated C-reactive protein (CRP) levels were randomized to receive either the statin drug Crestor, or a placebo. CRP is a non-specific marker of inflammation, and an increased CRP blood level is thought to represent inflammation within the blood vessels, and is a known risk factor for heart attack and stroke. The study was stopped after a mean follow-up of little less than two years, when the study’s independent Data Safety Monitoring Board (DSMB) determined that it would be unethical to continue. For, at that point, individuals taking the statin had a 20% reduction in overall mortality, a dramatic reduction in heart attacks, a 50% reduction in stroke, and a 40% reduction in venous thrombosis and pulmonary embolism. All these findings were highly statistically significant.

This study is noteworthy because it was the first large randomized trial to show that taking a statin can markedly reduce the incidence of some very harmful cardiovascular outcomes in people who are considered to have “normal” cholesterol levels.*

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* Notably, typical LDL cholesterol levels among primitive hunting/gathering cultures is around 50 mg/dL, instead of the 100 – 120 mg/dL we consider to be normal. These primitive folks have an extremely low incidence of cardiovascular disease, so maybe humans’ optimal cholesterol level is much lower than we now think. On the other hand, the low risk of cardiovascular disease among hunters/gatherers may instead be related to the fact that many more of them than of us are consumed by various species of carnivores before they’re 30.
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To be sure, the JUPITER trial was far from perfect. Because of its design, it could not (and did not) tell us whether the beneficial outcome is specific to Crestor, or is a class effect of all statins (which seems very likely). It did not tell us whether reducing CRP levels is itself beneficial, or even whether using CRP as a screening tool is actually helpful. (The people enrolled in this trial tended to have several other risk factors, such as being overweight, having metabolic syndrome, and smoking, and it is not clear how much additional risk elevated CRP levels really added in this population.) And this trial did not tell us the risks of lifelong, or even very long-term, Crestor therapy.

But JUPITER did tell us something that is very useful to know, and with a very high degree of statistical surety: Giving Crestor to patients similar to the ones enrolled in this study can be expected to result in significantly and substantially improved cardiovascular outcomes, and in a relatively short period of time.

If medicine were practiced the way it ought to be – where the doctor takes the available evidence, as imperfect as it always is, and applies it to each of her individual patients – then the incompleteness of answers from the JUPITER trial would present no special problems. After all, doctors never have all the answers when they help patients make decisions. So, in this case the doctor would discuss the pros and cons of statin therapy – the risks, the potential benefits, and all the quite important unknowns – and place the decision in the perspective of what might be gained if the patient instead took pains to control their weight, exercise, diet, smoking, &c. At the end of the day, some patients would insist on avoiding drug therapy at all costs; others would insist on Crestor and nothing else; yet others would choose to try a much cheaper generic statin; and some would even opt (believe it or not) for a trial of lifestyle changes before deciding on statin therapy. In other words, there is an entire range of reasonable options given the limitations of our knowledge, as there often is in clinical medicine. As time goes by, more scientific evidence is often brought to bear and clinical decisions can become more informed. But whatever the state of the evidence, doctors and patients can generally get by without violating too severely any ethical or medical precepts that would cause objective and neutral observers to complain very much.

But this kind of individualized give-and-take between doctor and patient, in which the pros and cons are discussed in light of the patient’s own leanings, is no longer how doctors will practice medicine. Instead, they will practice herd medicine. Expert panels will decide whether people ought to take Crestor, or some other statin, or nothing – and that decision must apply to everybody.

And this makes the stakes very high when it comes to a clinical trial like JUPITER. For herd medicine does not permit a range of actions tailored to fit individual patients (consistent with the uncertainties inherent in the results of any clinical trial). Instead, under herd medicine the results of clinical trials generally cannot be permitted to remain imperfect or nuanced or subject to individual application, but must be resolved by a central panel of government-issue experts into a binary system – yes (do it) or no (don’t do it). In the case of JUPITER, the guidelines which some expert panel is going to have to produce will have to say whether or not to recommend Crestor to patients like the ones enrolled in the study, at a potential cost of several billion dollars a year.

It should be obvious that the answer which would be more pleasant to the ends of the Central Authority, and by a large margin, would be: No, don’t adopt the JUPITER results into clinical practice.

However, the expert panels which are called for by Obamacare have not been formulated yet, and we are still operating under the “old” rules. So, still subject to all the duress which is created by unfortunately-resolved clinical trials like this one, the FDA, somewhat reluctantly, approved the use of Crestor for JUPITER-like patients in late 2009. That approval, of course, is subject to review by the new expert panels, once they are actually in operation.

This, I submit for your consideration, is likely what instigated the almost violently anti-JUPITER issue of the Archives. It might even be suggested that the production of this extraordinary Archives indicates that we may be dealing here with a bunch of wannabe federally-sanctioned experts, auditioning for positions on the expert panels. What better way to get the Central Authority’s attention than to let them know that you are of the appropriate frame of mind to assiduously seek out scientific-sounding arguments to discount the straightforward and compelling, but fiscally unfortunate, results of a well-known clinical trial?

Of the four papers appearing in the Archives, three are more-or-less legitimate academic articles that make reasonable points, but do no harm to the main result of JUPITER. The fourth is a straightforward polemic, which has no place in a peer-reviewed medical journal, and whose very presence, I believe, strongly suggests that the editors of the Archives themselves may be auditioning for spots on an expert panel.

We can make short work of the three reasonably legitimate articles. One pointed out that JUPITER did not tease out the real importance of CRP levels, or whether lowering those levels is useful. This is true, but that fact does not touch the main conclusion of JUPITER. The second article was a meta-analysis which incorporated several other primary prevention trials using statins, and concluded that there is no overall benefit to statins in primary prevention patients. Aside from the usual problems inherent in meta-analyses, a) the JUPITER study looked at a specific sub-population of primary prevention patients unlike those addressed by these other studies, so whether these studies can be legitimately pooled is an open question, and b) since JUPITER is the first study to show a benefit in using statins for primary prevention, it is a foregone conclusion that if you assemble enough of the previous, negative studies and lump them together with JUPITER in a meta-analysis, you will be able to dilute the results of JUPITER sufficiently to achieve an overall negative result. Actually doing such a meta-analysis, then, is merely an exercise in math, not in revelation.

The third article criticized the JUPITER DSMB for stopping the trial earlier than originally planned. The DSMB, however, had no real choice in the matter – ethically or legally – given the striking statistical significance of the benefit seen with Crestor. When a patient signs an informed consent agreement to participate in a clinical trial, part of that “contract,” a part required by law, is a statement to the effect that if information comes to light during the course of the study that might impact a patient’s willingness to continue participating, that information must be made available. The fact that the Crestor branch of the study was found to have markedly and significantly improved survival, fewer strokes and heart attacks, &c., than the placebo branch, clearly constitutes such information. Indeed, it is the job of the DSMB to monitor the study for this kind of information, and to stop the study whenever it becomes certain that continuing it would expose study participants to unreasonable risks. This is why independent DSMBs exist in the first place – to protect the rights and welfare of the research subjects under the fiduciary agreement that comprises informed consent. Stopping the study when they did was not “premature;” continuing the study would have been illegitimate.

This same argument – that RCTs should never be stopped prior to the original stopping point – has been raised in the intervening years by several other experts. It is a viewpoint one perhaps ought to expect from purveyors of herd medicine. The DSMB, after all, is an artifact from a time when the patients agreeing to be enrolled in an RCT were considered to be individuals, who of their own free will volunteered to participate in a clinical trial where some aspect of their therapy would be determined by chance, and whose interests, accordingly, ought to be protected. The notion that a trial ought to be driven to its pre-set conclusion, even after it is shown that doing so will cause predictable and measurable harm to individuals in one arm or another of the trial, derives naturally from a herd medicine paradigm. Such a notion ought to give anyone pause before agreeing to participate in an RCT today.

The fourth article is more striking (and more fun) than the other three. Interestingly, it was categorized by the Archives as an “Original Investigation,” despite the fact that it describes no investigation of any kind whatsoever – original or derivative. It merely revisits the data from JUPITER (in a spectacularly biased manner), and offers a spate of ad hominem attacks, alleging bias to the point of corruption, without any supporting evidence, against JUPITER’s sponsor, its investigators, and most astoundingly, the chair of the DSMB (who is a well known and highly respected figure, especially known and revered for his complete objectivity and lack of bias). If such an article has any place at all in a peer-reviewed medical journal – which I doubt – it ought to be clearly labeled as an opinion piece, and not as a piece of original research. Whatever it may be, it’s not that.

But the most delicious aspect of this fourth article is that two of its authors, including its lead author, are members of a fringe medical group known as The International Network of Cholesterol Skeptics (THINCS), whose stated mission is to “oppose” the notion that high cholesterol and animal fat play a role in cardiovascular disease. Members of THINCS also take an extraordinarily strong position opposing statins for any clinical use whatsoever. (One might actually assume that, since JUPITER shows that cardiovascular outcomes can be improved by statins in people with normal cholesterol levels, the THINCS would embrace the study as evidence that perhaps cholesterol is not as important as it’s cracked up to be. But apparently, this argument is completely negated by the fact that statins were the vehicle for making it. Many in the anti-statin crowd would object to statins even if they were proven to cure heart disease, cancer, baldness, and obesity AND produced fine and durable erections upon demand.)

The best part of all this is that the astounding anti-cholesterol, anti-statin bias of the authors was not disclosed in their article – whose main thrust, again, was to criticize the disclosed biases of the JUPITER investigators.

The venerable Pharmalot blog noted this irony, and contacted Dr. Rita Redberg (editor of the Archives) and Michel de Lorgeril (THINCS-master and prime author of the fourth article) to ask them why the association with THINCS was not disclosed.

Redberg: “I’m not clear this is an undisclosed conflict. The policy mentions a personal relationship that could influence one’s work. I think that could be a big stretch. My initial impression is the group has an intellectual message, but doesn’t fit as a personal relationship that could effect the authors’ work.”

de Lorgeril: “[While it is] very important to disclose financial conflicts of interest that can influence our way of working and thinking about cholesterol and statins, there is so far no obligation to provide a CV each time we publish any thing…May I underline the fact that being a member of THINCS – not a group of terrorists, mainly a club of very kind retired scientists with whom I have interesting and open discussion – is not a conflict of interest?”

I may be old fashioned, but I think that being a member of an “out there” group like THINCS, which appears to advance selected and distorted data on its own website aimed at furthering its stated mission of “opposing” (not investigating or questioning) the cholesterol hypothesis and the use of statins, might make one prone to a bit of bias when writing a broadside critiquing a study like JUPITER, and loudly criticizing anyone associated with that study for their bias.

The irony here is amazing. The lack of embarassment is astounding.

This sort of bias (demonstrably rooted in a willingness to select/ignore/distort data in order to make a preconceived point) is likely to be as strong as any that might accompany, for instance, receiving a stipend from a statin company for participating in clinical research. Membership in THINCS may not preclude one from writing such an article, but I think the association at least ought to be disclosed, just as financial relationships must be disclosed.

I have a hard time explaining how this can happen with a prestigious medical journal like the Archives. But like Sherlock Holmes says, when you have eliminated the impossible (such as, the idea that this article deserved to be published in its current form), whatever remains, however improbable, must be the truth.

And this is why I am forced to suggest that several of the authors appearing in that issue of the Archives of Internal Medicine, along with its editors, may be in the mode of ingratiating themselves to the sundry officials and czars within the govenment who will be assembling the expert medical panels which will be making the momentous decisions that will determine the flow of hundreds of billions of dollars, and (forgive me) of life and death.

Admittedly the issue of the Archives I have been discussing does not accurately reflect the general tenor of criticism the JUPITER trial has engendered in the academic community, which has been far calmer and less polemical. The fact is that the implications of this trial, when straightforwardly interpreted, are very disturbing to payers, both private insurers and the government. So in the years since this study was published there has been a general effort to diminish its results, from several fronts, that, taken together, should give future expert panels plenty of legitimate-sounding resources with which to deny its application to the herd.

This larger group of critics of the JUPITER trial all come from the legitimate medical establishment, and are proponents of using RCTs to make medical decisions. They claim to be willing to follow the data from RCTs to wherever they may lead.

For these critics, it seems pretty clear that the chief concern regarding JUPITER is its cost implications. That is, these people feel strongly that it would simply be too expensive to follow the results of the JUPITER trial to their logical conclusion. This, indeed, would be a very reasonable position to take – as long as their argument went something like this: “Yes, the JUPITER trial shows that many lives would be saved if people like those enrolled in the study would take Crestor, but it’s just too expensive to buy Crestor for all these people.”

But this sounds like rationing, and Americans don’t ration. So instead critics, even those pure thinkers in the academy, have tried to attack the results of JUPITER, arguing that the results of the study actually do not support the use of statins in these patients.

Unfortunately, turning aside the results of a statistically definitive RCT can be a challenge. In fact, the need to discount the results of JUPITER leaves critics little choice but to engage in statistical legerdemain. There are several useful techniques they can employ to this end.

Many of the arguments that have been ginned up in this effort have derived not from data published in the JUPITER trial itself, but instead from statements made in an editorial written by Dr. Mark A. Hlatky, and published in the same issue of the New England Journal of Medicine in which the JUPITER study itself appeared.

Most of Dr. Hlatky’s editorial is measured and reasonable. But along the way – either inadvertently or slyly – he threw in a key summary sentence that has been greedily grasped by those who would discount the JUPITER results, to wit: “The proportion of participants with hard cardiac events in JUPITER was reduced from 1.8% (157 of 8901 subjects) in the placebo group to 0.9% (83 of the 8901 subjects) in the rosuvastatin [Crestor] group; thus, 120 participants were treated for 1.9 years to prevent one event.”

This statement, at least taken at its face value as a stand-alone analysis, is statistically naive, and fundamentally wrong.

In a long-term clinical study in which the endpoints are events that can occur at any time (such as heart attack, stroke or death), then the probability that an enrolled patient will reach an endpoint during the trial increases the longer he/she has been enrolled. But in virtually all clinical trials, the length of time different people are enrolled varies greatly. This is because it often takes years to enroll people in clinical trials, so that when the trial ends, some will have been in the trial for many years, others for only a little while. This means that the risk exposure of each research subject is different, and is proportional to the total time they were enrolled. Not uncommonly, the enrollment process is not smooth – there are periods of more rapid enrollment, and periods of slower enrollment – so if all you do is average the enrollment time (as was done by Hlatky – 1.9 years) you are likely to get skewed results. So it is simply not statistically legitimate to do so.

There is a legitimate, well-known and universally accepted method for analyzing these kinds of longitudinal outcome statistics, and it’s called the Kaplan-Meier method. And indeed, the authors of the JUPITER trial presented in their paper a complete Kaplan-Meier analysis of their data, and the results look quite a bit different from Hlatky’s summary statement. The Kaplan-Meier analysis reveals that the risk of heart attack, stroke, and death all increase steadily through at least four years, so that at four years after enrollment the risk of reaching one of the “cardiovascular event” endpoints was about 8% (not 1.8%). Further, the Kaplan-Meier analysis shows that the protection imparted by Crestor persists through at least four years, and that indeed the magnitude of protection (i.e., the difference in outcomes between the treated group and the placebo group) increases throughout that entire duration. So, four years after enrollment in the study, the placebo group had roughly an 8% event rate, compared to roughly a 3% event rate for the Crestor group – an absolute difference of about 5% (not 0.9%). This is a far greater benefit than is suggested by Hlatky’s shorthand summary.

Suffice to say, then, that Hlatky’s summary statement apparently ignores the appropriately analyzed data which is clearly presented in the JUPITER paper itself, and which documents that the clinical benefit of Crestor was substantially more impressive than his widely-quoted summary statement suggests.

But as misleading as this summary statement may be, let us accept it at face value for a moment just for the sake of discussion, since that’s the data the JUPITER critics have chosen to latch on to.

Taking these numbers, the critics make the following argument: While the relative reduction in “hard cardiac events” is 50% (1.8 to 0.9), the absolute reduction is only 0.9%, which, anyone would agree, is a pretty small number. So, they conclude, the actual benefit imparted by Crestor is actually quite small.

That’s a very interesting argument. Let’s look at it in a couple of ways.

So we’ve got a population of patients whose risk of heart attack, stroke, bypass surgery/stenting, or death is about 2% after about two years, and by giving them a pill we can reduce that risk to about 1%, and we’re arguing that the absolute drop of 1% is not very much to crow about. Well, OK. But what if we found a pill that reduced their risk to zero at two years? That is, it completely wiped out the risk of cardiovascular catastrophes altogether. Would that be a good thing? Or would we say, “It’s just a 2% drop, really not much greater than the 1% drop we had with Crestor, so it’s no big deal?” I think not. I suppose we would think that totally eliminating all cardiovascular risk would be a very big deal indeed.

When you’re starting at a 2% risk, then any drop in risk is going to be an “absolutely” small number. And if we’re not going to pursue improvements in outcome of such a small magnitude, then why the heck are we worrying about preventative medicine in the first place? Once you get past the big things (drain the swamps, don’t drink the water downhill from the outhouse, &c.) then all preventative medicine tends to consist of small, incremental improvements in outcome. Popular pronouncements to the contrary notwithstanding, preventative medicine is largely the art of spending a lot of money for this magnitude of incremental improvement. If we Americans decide we shouldn’t do this anymore, then I would find it unfortunate but understandable. But it hardly seems reasonable to arbitrarily focus on this one, particular improvement in preventative cardiology, and (within a healthcare system that insists it is not rationing care) pronounce that this is the one we’re not paying for.

Another way of looking at this “the benefit is too small” argument is by considering that 7.4 million Americans fit the entrance criteria for JUPITER. By giving all these people a statin, we would be preventing about 66,600 major cardiovascular events over a two year period. If you’re going to say that 1% is a small number, I will counter by arguing that 66,600 is a big number. So do statins offer a substantial benefit or not? It depends on whether you choose to focus arbitrarily on the 1% or the 66,600.

(I understand that you may not be focusing at this moment on the 66,600 cardiovascular catastrophes that could be prevented, but on the 7.4 million people who will be taking a drug that costs $120 per month. But we’re not talking about cost yet, we’re only talking about whether the drug does some good. If we decide it does, then we’ll need to link that “good” to a procedure that measures whether the “good” is worth the money we would need to spend to achieve it. The critics of JUPITER try to avoid talking about cost – since that would admit they’re rationing – by insisting that there’s just not enough “good” to bother with. I am simply pointing out that such an argument – that preventing 66,600 very bad outcomes is not enough to bother with – is on its face absurd.)

Another argument invoked by critics is based on the “number needed to treat” (NNT) analysis. Again they rely on Hlatky’s unfortunate summary of the data: “120 participants were treated for 1.9 years to prevent one event.” This number – which the critics insist is just too high – is misleading for the reasons already discussed. The real NNT, based on more legitimate statistical analysis, is plainly laid out in the JUPITER paper itself. It turns out that the longer patients in this trial were treated with Crestor, the lower the NNT became. So: At two years, the NNT was 95; at four years, it was 31; and at five years, it was projected to be only 25. Whether you think it is reasonable to treat 25 people with a pill for five years to prevent one of them from having a heart attack, stroke, or death is, I suppose, a matter of opinion. But based on NNT analyses for many widely-accepted therapies in medicine today, it looks pretty good.

All these arguments, of course, are merely distractions. The fact is that JUPITER showed a pretty striking reduction in some very nasty cardiovascular events over s pretty brief period of time, and the only real reason there’s any controversy at all is because of the cost of Crestor.

That cost is what makes us want to withhold Crestor, even though it is imparting at least some (and, I am arguing, quite a bit of) clinical benefit. In other words, the high cost makes us want to ration Crestor. The fact that we can only ration covertly, instead of openly, is what makes us want to bastardize the science and do a Kabuki dance with the statistics.

If we worked under a Method Three healthcare system, where the strict limits on public spending were determined openly, then we could do an objective, full-bore cost-benefit analysis on the use of Crestor in JUPITER-like patients, using legitimate and not ginned-up statistical analysis, and taking into account not only the cost of the drug, but also the cost that would be incurred by failing to stop preventable heart attacks, strokes, &c., and then determining where the overall cost-benefit result fell within our coverage criteria. If it met the criteria we would cover it, if not, not. This decision would not be arbitrary. It would be a fully transparent process, so that if the sponsor did not like the results, they would try diligently to find a way to reduce the cost of Crestor (I think they would succeed) to a value that would be compatible with their staying in business. (And for the first time, the price of medical products would be determined by a Laffer-like curve, where a price that was too high – like taxes that are too high – would reduce revenue, instead of increase revenue. Companies, being fairly rational, would ratchet their prices down to the optimal price point.)

But since we insist on doing our rationing covertly, I am sorry to say that we’re destined to keep making spurious arguments, and using dumbed-down statistical analysis to back them up. The JUPITER trial, while it is imperfect and while it does not answer every question, really is pretty straightforward. That we get so wrapped around the axle trying to fold such clinical trials into our covert rationing paradigm is simply another demonstration of the fact that covert rationing corrupts everything it touches.

The fact that so many respected academics are making such spurious statistical arguments is disconcerting and discouraging. Among other things, it means that the Central Authority will have many, many fully-domesticated experts to choose from when they assemble their all-powerful expert panels.

Summary

Herd medicine will follow naturally from any centrally-controlled Progressive healthcare system. Unless you are lucky enough to be included in the expert class, or are a part of the government leadership that controls the expert class, this is not a good thing.

Medical services that give substantial benefit to a minority of people will not be offered to any people, since the “herd effect” will likely be below an arbitrary cut-off value. Medical services that do make the cut will be prescribed for everybody, even though (since herd medicine is tuned to the average response across the population), something like half the population will respond less favorably than average. Herd medicine will stifle medical progress. And herd medicine will entice medical experts, who need to curry the favor of Progressive leaders in order to be recognized as legitimate experts, to abuse the science and the statistics of clinical trials.

It is important to note that while those of us who reside within the herd will find these features of herd medicine problematic, for our Progressive leaders herd medicine – which offers the centralized control they find absolutely necessary – is an unalloyed boon.

This is Chapter 8 of my book-in-progress, “Open Wide And Say Moo! – The Good Citizen’s Guide to Right Thoughts And Right Actions Under Obamacare.” Comments are fervently sought; you can leave them here.

You can read my rationale for undertaking this project, and thus opening myself up to the possibility of public failure, humiliation, derision, disapprobation, and unwanted scrutiny, here.

And here is the up-to-date archive for all the chapters that have been posted so far.
______

Chapter 8 – The Real Infrastructure of Obamacare

In 2009, while the Obamacare legislation was being debated, opponents put together various, very scary “flow charts,” to show how utterly convoluted and inherently dysfunctional our healthcare system would become under this new plan. These charts incorporated the scores of new federal agencies, panels, commissions and bureaus that were to be created by Obamacare, and attempted to demonstrate their complex interlinkages with meandering flow lines, making evident, for instance, numerous opportunities for procedural endless loops. And on these charts, invariably doctors would be positioned on one distant corner, and patients far away on some other distant corner, and the astounding bureaucratic morass in the middle made it plain that they might as well be on separate planets.

In other words, the main point of these flow charts was to show how getting medical services under Obamacare would become an ungodly mess.

This remains an important thing to understand about Obamacare. Still, if you are an American who has attempted to get healthcare services out of the pre-Obama healthcare system, it would not be surprising if your reaction to such news is, “So what else is new?”

In fact, it seems likely that many Americans regard the prospect of Obamacare thusly: “Yes, Obamacare will almost certainly become a bureaucratic nightmare. Those charts do look a little scary. But really, all that means is that we’ll be trading one bureaucratic nightmare for another. And if Obamacare gets a lot more people health insurance, and offers coverage for pre-existing conditions, and stops the evil insurance companies from killing people, it still might be a good trade.”

Such flow charts, as nicely as they may illustrate the bureaucratic complexity of Obamacare, nonetheless fail to tell the real story. They fail to show that Obamacare is, in fact, fundamentally different from anything that has come before. That fundamental difference is in the complete, top-down, centralized, command-and-control organization it will bring to American healthcare. This top-down structure will systematically destroy the role of individual physicians in making medical decisions, and as a result their patients will be reduced to faceless members of a herd.

The Real Structure of Obamacare

As we have seen several times, in order to control American healthcare it is absolutely imperative to control the behavior of American physicians. And fundamentally, the infrastructure of Obamacare is set up to do just that.

The scores of new federal agencies that show up on those flow charts, of course, will hamstring doctors in various useful ways. Each agency will have its own regulatory structure, and each will establish hundreds of new rules, regulations, and guidelines, and therefore, will produce hundreds of novel opportunities for doctors (and anyone else working in the healthcare system) to commit healthcare fraud. This will help to achieve the useful goal of placing doctors into a risk-avoidance frame of mind, rather than a patient-care frame of mind. But still, the large majority of these new agencies can be considered as nothing more than mere annoyances – sort of a swarm of flies buzzing around doctors’ heads as they plod along, trying to perform the main task.

It’s that main task – the real structure of Obamacare – that’s important.

Obamacare is set up primarily to eliminate the opportunity for doctors to make individual decisions. Important medical decisions will be made centrally, and will transmitted, through the new healthcare structure, to the doctors on the ground.

Over the years, healthcare bureaucrats have come to understand that just telling doctors what they are supposed to do will not be sufficient. Doctors may or may not obey, and policing the millions of individual decisions that are being made by doctors every day will be next to impossible.

So fundamentally, Obamacare is designed to incorporate doctors into new organizations that will be established to deliver efficient, high-quality healthcare, as defined by the Central Authority. And here I use the word “incorporate” in its literal form – to merge bodily into a larger structure, and to become fully a part of that larger structure.

To maintain their viability, these new organizations must require their physician-components (and all their other organic components) to function in what us usually referred to as an “integrated, team-based decisional paradigm,” that is, to give up any idea of independent decision making. Rather, for the survival of the whole, each entity within the organization will need to closely follow formally established “best practices.”

These new organizations – which at the moment are being called Accountable Care Organizations (ACOs) – will likely consist of hospitals, doctors, and legions of “nonphysician providers,” such as nurse practitioners, physician assistants, and care coordinators. All medical care will be delivered by “patient care teams,” and, spearheaded by these teams, the organizaitons will go “at risk,” accepting pre-determined bundled payments to deliver care to a pre-defined population of patients.

For such organizations to work, doctors will have to cease being independent agents. They will have to follow to the letter the care directives established by the “team.” The viability of the entire organization will depend on doctors’ full compliance with this collective prime directive. Fortunately, since there is no need (or allowance) for independent thought or action on the part of physicians in such a system, one doctor is pretty much the same as another, so doctors are entirely interchangeable. The non-compliant ones can be culled out and replaced as needed.

These ideas are not really new, of course. HMOs tried similar things in the 1990s. The difference is that now there is nowhere else for doctors to go. Private practice is rapidly becoming unfeasible. Direct-pay practices (for as long as they continue to remain legal) are really only suitable for primary care. Specialists, who require lots of expensive stuff – things like gamma cameras, operating suites, catheterization laboratories, hordes of highly trained medical technicians, &c. – generally find it exceedingly difficult to function as independent operators. It is no longer the 1990s; if doctors want to practice medicine, joining an ACO will soon be their only option.

Once doctors are fully absorbed into these new “team-based” entities, it becomes relatively easy for the Central Authority to control things. The ACOs will only be paid if they follow the directives that are handed down by the various panels, bureaus, &c, created by Obamacare, and the ACOs will only remain viable if the imbedded doctors spend less money than the ACO takes in. Since the decision not to spend all that money will have been disseminated among numerous members of the “team,” and since team-based decisions will be mindful of “social justice,” doctors will be at least partially absolved of the crime of withholding useful healthcare. And since the Central Authority is merely handing out the money (along with a few helpful “guidelines”), it can plausibly deny that it is telling doctors how to practice medicine.

We Are The Borg

Knowing that many American doctors will find this arrangement odious, Ezekiel Emanuel from the White House’s Office of Management and Budget, and Nancy-Ann M. De Parle, Mr. Obama’s Czar of Healthcare Reform, co-authored an article in the Annals of Internal Medicine in 2010, to help change hearts and minds. It is a message directly from the White House to American doctors, appearing in a prestigious peer-reviewed medical journal no less, explaining why joining up with the new ACOs will be to their great benefit, and indeed, that it is an offer they cannot refuse. After reminding doctors of all the glorious accomplishments of Obamacare, they articulated why there is a duty to comply:

“[Obamacare] will unleash forces that favor integration across the continuum of care. Some organizing function will need to be developed to track quality measures, account for and manage shared financial incentives, and oversee care coordination. . .As physicians organize themselves into increasing larger groups — patient-centered medical home practices and accountable care organizations — they are, out of necessity, investing in the acquisition or development of management skills that could provide these organizing functions efficiently for physicians groups. . .For physicians, this means a profession that is more rewarding, more productive, and better able to realize its moral ideal.”

For readers who become somewhat mind-numbed by this kind of policy-wonk jargon, here is the correct translation:

“Physicians! You have been neglecting your moral obligation to the collective, in favor of your archaic devotion to the individual patient. Under Obamacare you will need to join organizations which are devoted to the proper collective goals, and which therefore will guarantee the proper moral ideals. You must function not as individual decisionmakers, but as integrated cogs in a vast healthcare continuum, which will stretch from the centralized bastion of gleaming moral authority (from which we pen this message) all the way down to the humble tip of your stethoscope. You will be rewarded for your cooperation, or suffer for your resistance (resistance, of course, being futile). So rejoice for the health of the collective, and for your own well-being, and prepare to be assimilated!”

Doctors, and all other healthcare workers, are to be integrated into localized, healthcare delivery collectives, which will dance to the ever-changing tunes set by the Central Authority. Everything in these ACOs will be shared collectively, including the financial risk, the medical decisions, and even the ethics of those medical decisions. The notion of doctors working as independent professionals, answerable only to their professional standards and to their patients, is to be abolished once and for all. In an Accountable Care Organization doctors do not owe the featured accountability to the patients. but rather, to the ACO itself, and to the Central Authority that regulates it.

This, then, is the fundamental structure of Obamacare. It finally places doctors into their proper place. They become interchangeable cogs in an integrated healthcare machine, a machine which is tied irrevocably, flesh to flesh, to the Central Authority.

Under this structure patients will lose their personal advocates once and for all. They will finally be reduced to the position that Progressive healthcare requires of them. They will no longer be individuals whose doctors owe them a duty. They will be members of a herd which an ACO is charged with husbanding at the lowest cost possible. And so, assimilating doctors into the Borg is the final step. It removes the last remaining obstruction to the widespread implementation of herd medicine.

Everything else about Obamacare – all those new agencies and all that new bureaucratic complexity – is just details.

How This Structure Facilitates Cost Control

As we saw earlier (Chapter 1), in any system in which healthcare costs are shared collectively, truly controlling the cost of healthcare will require withholding useful medical services from many patients who would benefit from them. But so far, despite all the coercion that has been applied to the medical profession, and despite the troubling extent to which doctors have caved in to that coercion, not enough healthcare is being withheld, and costs continue to accelerate. Physicians still have not been sufficiently controlled.

Reducing physicians to members of an integrated “healthcare team” which makes decisions collectively is a brilliant move. Any remaining vestiges of professional responsibility that may remain to some of the newly-integrated physicians will be washed out by the other members of the team, who will outnumber the doctors and who never have had such a professional imperative. For these others, a moral responsibility to the needs of the collective, i.e., to social justice, will likely be the obvious overriding imperative. And furthermore, it will be an imperative that is strongly reinforced at every turn by the agencies of the Central Authority which will decide how much money the team is going to recieve for its efforts. So the integrated teams will be exquisitely sensitive (and even sympathetic) to the needs of the Central Authority.

Obamacare provides countless ways for the Central Authority to influence the integrated healthcare teams to withhold medical services, from imposing outright rules, to influencing treatment philosophies, to threatening (overtly or subtly) prosecution. For the most part, however, these can be reduced to two main efforts: the imposition of expert-generated guidelines, and the imposition of payment caps.

Guidelines – A Tyranny of Experts

A major thrust of Obamacare will be to create numerous panels of experts, appointed by the Central Authority, which will – in an entirely disinterested and objective manner, of course – publish clinical “guidelines” which will suggest to physicians what medical services they ought to offer patients with specific medical conditions. In concept, clinical guidelines are a perfectly fine idea, and indeed are often helpful to practicing physicians. This is why professional organizations have published and updated numerous sets of clinical guidelines for decades.

But the guidelines published by the GOD panelists (Government Operatives Deliberating) will be something new. These guidelines will be treated as sacrosanct rules, which must not be broken, the violation of which might lead to criminal prosecution. We already have examples of criminal investigations based on alleged guideline violations, which I will show later.

I will be devoting much of the remainder of Part II of this book to the tyranny of experts which is about to be unleashed upon American doctors and patients, through the medium of “guidelines,” so I will say no more about it here. I will simply note that the structure of Obamacare, wherein it is an integrated team (instead of individual doctors) deciding whether to follow “suggested” sets of guidelines, will render this tool immensely more powerful than it has ever been before.

The Independent Payment Advisory Board

Perhaps nothing in the Obamacare legislation embodies the top-down, command-and-control nature of Progressive healthcare more than the Independent Payment Advisory Board (IPAB), a 15-member panel of “experts” to be appointed by the President. There are three particular features of the IPAB that illustrate this fact: The IPAB will control all healthcare spending, public and private. The IPAB has been awarded near-dictatorial power. And the IPAB is designed to be a nearly immutable entity.

The IPAB Will Control Everything

While the IPAB has several duties, the chief among these is to impose a final, insuperable cap on healthcare spending.

Obamacare hands the IPAB the authority to cap not only public healthcare spending, but also private healthcare spending (thus demonstrating, once again, that Progressives do indeed mean to restrict private healthcare spending). This particular feature of the IPAB is one of the more difficult-to-tease-out aspects of the Obamacare legislation, so it is fitting that the IPAB acquired this sweeping authority in a suitably convoluted and sneaky way.

Anyone who paid attention to the remarkable process that brought us our new and transformational healthcare system might recall that Obamacare was not passed in the usual manner. It began typically enough; there were separate House and Senate bills, each of which passed in their respective chambers (though without any Republican votes). Normally, the next step would be to send those two bills to a Joint Conference to hash out the differences, and then off to a final vote. This did not happen with Obamacare.

The main hangup occurred in the Senate. There, the President needed 60 votes to assure final passage of his bill. And in the way of negotiating for those necessary 60 votes, five or six Democrat Senators went behind closed doors to cobble together a list of amendments to the original Senate Bill – the so-called Managers’ Amendments. It is in the Managers’ Amendments that one can find such famous niceties as the bribes paid to Nebraska and Louisiana in order to entice their respective Senators to support the bill. Some of the deals made behind closed doors were so outlandish that even the Managers themselves (according to many reports at the time) did not expect them to survive the Joint Conference that everyone assumed would take place.

The original Senate bill, before the Managers’ Amendments were added, never created anything called an Independent Payment Advisory Board. Rather, in Section 3403 it created the Independent Medicare Advisory Board, whose powers (appropriately) were limited only to federally funded healthcare programs, such as Medicare. It was the Managers’ Amendments which re-empowered the IMAB, and re-christened it as the IPAB.

Specifically, Section 10320 (in the Managers’ Amendments portion of the legislation) grants the IPAB, beginning in 2015, the authority to limit all healthcare expenditures, that is, all healthcare expenditures, and not just expenditures by Medicare or government-run programs.

To emphasize this expanded authority, Section 10320 changes the name of the “Independent Medicare Advisory Board” to the “Independent Payment Advisory Board.” It directs the IPAB, at least every two years, to “submit to Congress and the President recommendations to slow the growth in national health expenditures” for private healthcare programs. Furthermore, it designates that these “recommendations” may be implemented by the Secretary of HHS or other Federal agencies “administratively” (that is, without any action by Congress).

The justification for this mind-boggling expansion of the IPAB’s authority, to the extent that any justification was offered, appeared to be that controlling private healthcare expenditures will directly impact Medicare, since the “target” Medicare growth rate (which the IMAB was originally charged with achieving) will be determined by overall healthcare expenditures. Therefore, it is necessary to control all healthcare expenditures, public and private. (More practically, if Medicare patients are subjected to arbitrary cost-cutting measures that do not affect younger Americans, we Old Farts are likely to become inconveniently rowdy.)

Once the Managers had devised sufficient paybacks in the Managers’ Amendments to get the needed 60 votes, and the Senate bill finally passed, President Obama and his Congressional allies, Mr. Reid and Ms. Pelosi, determined that allowing the new law to go to Joint Conference would be counterproductive. Support among Democrats in the Senate was so tenuous that party leaders realized the bill would never survive another Senate vote after a Joint Conference. It would be easier, they calculated, to ram the Senate bill, fully intact including the Managers’ Amendments, through the House of Representatives, employing the always-useful reasoning that passing the law right then was a manifest emergency. So that is what they did. And while the vote was also a much closer call than Democrat leaders would have liked, the Senate bill finally passed in the House. And in this way, to the astonishment of many, the Senate bill, Managers’ Amendments and all, became law.

However convoluted the process may have been, the fact is that Obamacare grants the IPAB, a non-elected entity within the federal government, the authority to limit all healthcare spending, including private spending.

The IPAB’s Authority Is Nearly Dictatorial

A quick reading of Section 3403 might leave one with the impression that the IPAB is a sort of Mr. Rogers of healthcare – a mild-mannered, friendly, always-helpful, but ultimately undemanding agent for good. This is the impression imparted by the first few paragraphs of the Section, which paint the new entity as an “advisory” board, whose main task is to develop “proposals” and “advisory reports,” which “proposals” and “advisory reports” would solely consist of various “recommendations,” that ought to be “considered” for the purpose of cost reduction.

Nothing could be further from the truth. This language is simply another example of supplying a new law, which is far more radical than the authors would like people to know, with a soothingly misleading introductory paragraph. The IPAB is actually designed to be as all-powerful as it’s possible to be.

Each year, once the Medicare’s Chief Actuary determines that the projected per capita growth rate for Medicare exceeds the designated target growth rate (which is an inevitability), the IPAB is required to submit a plan which will cut healthcare costs sufficiently to bring the growth rate back in line; which is to say, the IPAB will determine what will be paid for and what will not. Then, the Secretary of HHS is required to implement the IPAB’s plan in its entirety, without exception – unless Congress acts to block implementation. However, the ability of Congress to do so is severely limited. The representatives of the people are forbidden from taking any action “that would repeal or otherwise change the recommendations of the Board,” unless it: a)votes to halt the IPAB mandates with a supermajority of the Senate; and b: devises its own specific cost cutting scheme that will achieve equivalent results. If Congress had the will to do such a thing, however, we never would have needed Obamacare in the first place.

So, in practice, the cost-cutting “recommendations” which the IPAB will “propose” for “consideration” by the Secretary and by the Congress will be implemented in their entirety, automatically, without revision, and will be backed by the full authority of the Federal government.

For all practical purposes, the IPAB will become a new agency of the executive branch with near-dictatorial authority to cut healthcare spending, public and private, where and when and for whom it sees fit.

The IPAB Is Designed To Be Immutable

Section 3403 also contains some remarkable language that likely has never been seen before in American legislative history. To wit:

“It shall not be in order in the Senate or the House of Representatives to consider any bill, resolution, amendment, or conference report that would repeal or otherwise change this subsection.”

So the designers of Obamacare, recognizing that the arbitrary cost cutting that the IPAB will impose on all those ACOs and other integrated healthcare teams (as they happily toil away in the new healthcare worker’s paradise) is sure to create significant political blowback, has sought to immunize the IPAB from any revisionary lawmaking that might result.

And as astounding as it may sound, the IPAB and all its designated dictatorial functions are designed by law to be in force for perpetuity. Our Congress has passed legislation that purports to bind all future Congresses from altering it in any way.

We have heard from the President and others that the IPAB is a very important feature of our new healthcare system. This “immutability clause” ought to convince us just how important they believe it to be. This clause necessarily implies that the IPAB is not only the most important innovation in Obamacare, but indeed, it apparently is most important legislative provision ever written. We know this because no other provision has ever received such extraordinary protections from any future alterations whatsoever.

One can only bask in the utter audacity of our Progressive leaders, who are so sure they know what’s best for us that they were willing to engage in all manner of legislative legerdemain to pass Obamacare, not only against the apparent expressed will of the people, but also (as it turns out) against the objections of any future American Congress that is sent to Washington by those people.

Not even our Constitution itself – a document that attempted to establish a government for all time – was as audacious as this. For the Constitution, at least, provided a mechanism for its own alteration.

One wracks one’s brain to think of the last time a law was promulgated with such audacity – not with the audacity of hope, but the audacity of perpetuity. Even monarchs who purported to reign under Divine Right understood that future monarchs, who would also rule under the same God-given right, might thus alter any laws they made.

I believe we need to go all the way back to Moses, coming down from Mt. Sinai and holding aloft his awesome Tablets filled with divine writ, to find a law or set of laws that, from the moment they were written, were decreed to remain in force for ever and ever.

Only God has ever tried this before.

The Structure of Omamacare In A Nutshell

So now we can see clearly the entire skeletal infrastructure of Obamacare. Actual medical care will be parsed out by integrated healthcare “teams.” There will no longer be any “doctor-patient relationships,” dedicated to the welfare of the individual patient. Instead there will be “team-patient relationships” dedicated to the ethic of social justice. These teams will receive from the Central Authority, via expert panels whose work product is “guidelines,” the clinical rules under which they are to determine who gets what healthcare, when, and how. And they will receive from the greatest GOD panel of all – the IPAB – the budgets which will determine how much of that allowable healthcare they can actually deliver.

Individual patients who are cut out and who want to use their own resources to guard their personal welfare will be guilty of the crime of encouraging an unfair, two-tiered healthcare system.

So go ahead, if you must, and amuse yourself with those organizational charts about Obamacare published by Republicans and other troublemakers. They are indeed troubling.

But if all you get out of those charts is that Obamacare will become a bureaucratic nightmare – sort of a DMV on steroids – you are missing the greater point. Obamacare does far worse than merely add a few more layers of ossified bureaucracy onto an already difficult-to-navigate healthcare system.

It fundamentally changes the structure of American healthcare, centralizing control, eliminating the doctor-patient relationship once and for all, and subjecting individual patients to the decisions of “integrated teams” that will be overtly dedicated to collectivist goals.

This structure will finally systematize the practice of herd medicine in America.

This is Chapter 7 of my book-in-progress, “Open Wide And Say Moo! – The Good Citizen’s Guide to Right Thoughts And Right Actions Under Obamacare.” Comments are fervently sought; you can leave them here.

You can read my rationale for undertaking this project, and thus opening myself up to the possibility of public failure, humiliation, derision, disapprobation, and unwanted scrutiny, here.

And here is the up-to-date archive for all the chapters that have been posted so far.
_____

Chapter 7 – Limiting Individual Prerogatives in a Progressive Healthcare System

Of all the seemingly outlandish things I am going to assert in this book – all of which I will fervently desire the reader to, if not swallow whole, then at least take into serious account – the most outlandish of all is probably the one I am addressing in this chapter. Namely, that any Progressive healthcare system will necessarily attempt to curtail the ability of individual Americans to spend their own money on their own healthcare, and thus, will try to limit the most essential freedom of all – the freedom to act to preserve oneself.

To those many readers who at this moment are expressing alarm over my apparent paranoia, I thank you for your concern. But fear not, for if it turns out I am wrong about this (and I sincerely hope that I am), then not only do they have medication for paranoia, but also, I would be permitted to purchase it legally.

Progressives, of course, deny that they have any such thing in mind. And undoubtedly the majority of progressives, and even many actual Progressives, do not. Indeed, I will happily concede it likely that very few Progressives actually start out with this idea.

What I am saying is that limiting this vital individual liberty turns out to be such an essential component of any Progressive healthcare system that the people who run such a system, perhaps despite themselves, will, sooner or later, find themselves acting forcefully to limit it. This is my proposition.

My intention in this chapter is (once again) to present my proposition as a theory. It is a theory that takes into account two things. First, it incorporates the natural and necessary inclinations of the Progressive Program to limit an individual’s freedom of action regarding his or her own health. And second, my theory incorporates objective observations we can make today, relating to actions which Progressives have already taken in this regard. I contend that my theory best explains both of these things. And of course, as always, I invite (and in this case, greatly desire to hear of) any alternative theories that explain these observations better than mine does.

But if my theory is correct, then if we Americans are to avoid severe restrictions on our ability to purchase healthcare services with our own money (and, ultimately, on our ability to expend any individual resources for any individual benefit), such a favorable outcome will only result if we remain vigilant and alert to the aims of our Progressive leaders, and to fight vigorously against their efforts to suppress our liberties, whenever and whereever we find them. It will not result from our complacency, or from placing our trust in the beneficence, the common sense, or the respect for fundamental American precepts, of our political leaders.

The Individual Is The Proper Guardian Of His Own Health

It really ought to go without saying that a person should be able to expend his or her own resources to purchase any healthcare service he or she desires. This is a primary corollary of classical liberalism, and was recognized as a fundamental human right by the likes of John Locke and Thomas Jefferson.

It is also an idea deeply imbedded in American jurisprudence. The great Supreme Court Justice Joseph Story, in his Commentaries on the Constitution of the United States (1873), noted that the individual “is the proper guardian of his own health.” This precept was repeated by Louis Brandeis in 1890, and became the foundation of the Supreme Court’s assertion of an individual right to privacy. In particular, the writings of Story and Brandeis were specifically relied upon by the Court in its 1965 finding (Griswold v. Connecticut) that a right to privacy is not only guaranteed by our Constitution, but is also a right which is “older than our Bill of Rights.” I would like to remind my Progressive friends that it was this very precept that laid the basis for deciding Roe v. Wade in 1973.

Fundamentally, both classic liberal philosophy and the American judicial system have always recognized a liberty to act to preserve one’s own health to be an inherent, inalienable right.

Why Individual Prerogatives Must Be Restrained

Despite this long history in political philosophy and in jurisprudence in favor of such an inherent liberty, it is nonetheless natural and unavoidable for any Progressive healthcare system to strive to limit it. This is because Progressive healthcare systems are necessarily universal.

They are universal in two senses. First, they attempt to cover all people. Second, they purport to cover all healthcare services.

Under Obamacare, for instance, health insurance – which every American is required to have – must cover (as laid out in Section 1302 of the law): ambulatory patient services, emergency services, hospitalization, maternity and newborn care, mental health and substance use disorder services, including behavioral health treatment, prescription drugs, rehabilitative and habilitative services and devices, laboratory services, preventive and wellness services and chronic disease management, pediatric services, and oral and vision care.

Fundamentally, this “universality of features” reflects a particular philosophy. It is, in fact, the Progressive philosophy. Healthcare being an essential component of any ideal society, it is thus necessary to assure that everybody receives everything that is officially deemed to be healthcare. In Section 1302, the Central Authority is telling us, everything will be taken care of for all of us, from soup to nuts. So there is no need to worry our pretty little heads.

But, as always when the Central Authority assumes all responsibility for providing some aspect of security (in this case, healthcare security), it also assumes all control.

Complete central control is necessary not only to assure the societal perfection promised by the Progressive Program. Central control is also the method by which Progressives propose to manage America’s healthcare spending. Which is to say, controlling all healthcare expenditures is essential for the purpose of covert rationing.

Allowing individuals to spend their own money fundamentally undermines a Progressive healthcare system. It implies that the Central Authority is actually not supplying all useful healthcare services (when, by definition, it is), and thus implies that the government is holding back, and indeed, may be engaging in some kind of rationing. Such an implication cannot be permitted.

To say it another way, when individuals are allowed to purchase “extra” healthcare, that’s a graphic admission to the unwashed masses that there is extra healthcare to be had. The real problem is that this behavior raises expectations for everybody, and these higher expectations make it that much more difficult for the Central Authority to ration covertly.

The critical importance of controlling expectations in a Progressive healthcare system is nicely illustrated by some of the problems being experienced by the British and the Canadian healthcare systems. Both of these systems, naturally, initially outlawed private healthcare spending. But unfortunately, the very visible medical progress that continued unabated in the American healthcare system – new drugs, new techniques and new technology – were noticed by Canadian and British citizens, and created new demands upon their respective healthcare systems. Essentially, seeing what was possible, a critical mass of the population demanded some of these medical advances, even if they had to pay for them themselves. Ultimately the authorities were forced to relent, at least to a degree, on their desired restrictions on individual freedom.

Some have argued that such “loosening” of individual restrictions in Great Britain and in Canada proves that any restrictions on individuals simply will not stand – so we Americans don’t really have anything to worry about. For, if such restrictions cannot be maintained in those countries, how will they ever be maintained here? Perhaps. But I would suggest instead that the need to loosen individual restrictions in Canada and Great Britain graphically illustrates the critical necessity, in any universal healthcare system, of managing expectations. It in fact proves that a failure to manage the expectations of the people leads to a loss of control.

Had it not been for the very visible example of advances in American healthcare, citizens of Canada and Great Britain quite possibly never would have agitated for “more.” As it is, thanks to the unfortunate example of the high-cost healthcare their citizens saw in the United States, British and Canadian officials were simply unable to manage the expectations of their own citizenry. (Which means that healthcare officials in those countries were likely among the happiest people, anywhere, when Obamacare became the law in America.)

Once we have a universal healthcare system in America, it will therefore become critically important for the Central Authority to manage the healthcare expectations of American citizens. Fortunately, American healthcare bureaucrats won’t have any annoying, external healthcare systems to worry about, busily spinning out advances in medical technology and thus continually raising expectations. Their job likely will be somewhat easier than it was for their counterparts in Canada and England.

For American bureaucrats, managing public expectations will largely become a matter of restraining individual American citizens from going outside the system, and buying extra healthcare with their own money. And for this reason, restricting individual prerogatives in the United States will be critical, even more critical than it was in our cousin nations. And we should not be surprised if our bureaucrats employ some very devious and even draconian maneuvers to do so.

It’s All About Fairness

The official rationale which the Central Authority will always invoke for taking such restrictive actions will be to achieve “fairness.” Allowing the rich to go outside the system would create an unfair, two-tiered healthcare system, &c. The goal of fairness, as is being taught to every schoolchild, is unquestionably and obviously a righteous one, and indeed, its achievement is a chief responsibility of the Central Authority*. Equally obvious is the fact that its hindrance is always threatened by the greed of a certain kind of person. Therefore, the Central Authority is fully justified in constraining the individual liberties of those enemies of righteousness who would stifle fairness.

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*As I write this, President Obama is campaigning very hard for a special new tax on the very rich. While this is nothing new in itself, what is new is the rationale that is being advanced for this new tax, i.e., “fairness.” The President and his spokespersons have all acknowledged that this new proposed tax would do next to nothing to reduce our deficit, or to create new revenue for the government. Rather, the purpose they articulate for taking the property earned by these very successful people is, quite explicitly, redistributive justice, or “fairness.” This argument, possibly for the first time, explicitly creates “fairness” as a principle goal of taxation, and makes achieving such fairness a chief responsibility of the Central Authority (which is convenient, since the Central Authority also gets to define what “fairness” is). This explicit new principle is readily extendable to government actions outside the tax code – such as healthcare.
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And so, restricting the right of individuals to use their own resources to benefit their own health is something that will always be conducted only for the best of reasons – to achieve the fairest and the most ethical healthcare system possible.

But whatever the reasons Progressives might offer for their actions, and whatever the dictates of classical liberal philosophy or American jurisprudence to the contrary, their attempt to restrict individual prerogatives will become deadly serious, because doing so is essential to their real aims.

Hillary Started It

The natural propensity of Progressives to limit individual prerogatives was manifest as early as 1993, with the Clinton Health Security Act, affectionately known as Hillarycare.

The question of how much individual freedom Hillarycare would permit came to a head in early 1994, just as the debate over this bill was reaching a crescendo, and played a significant role in defeating the legislation. What brought the question to a head was the publication of an article by Betsy McCaughey, entitled No Exit, in (of all places) The New Republic.

Ms. McCaughey, who quickly became for Progressives a sort of practice version of Sarah Palin, was at the time a frequent denizen of Conservative think tanks and an occasional editorialist. But what made her an acknowledged expert on Hillarycare was the fact that she was one of the few people who actually had read the legislation.

No Exit revealed that many of the claims being made by proponents of Hillarycare (for instance, that patients could keep their present insurance; that specialty care would be readily available; and that there would be no rationing) were actually false. Despite the fact that the White House quickly released an official response to Mcaughey’s article insisting that many of her conclusions were untrue, her accusations stuck. And according to many observers McCaughey’s article was at least as influential as the Harry and Louise commercials in turning the tide against Hillarycare. Indeed, the importance of her article was formally recognized when it won her the National Magazine Award for excellence in the public interest.

One of McCaughey’s chief assertions – and likely its most striking one – was that Hillarycare would make it illegal for patients to pay doctors directly, and that doctors could be paid only through the government-sanctioned insurance plans. And of all her claims this one in particular made proponents of Hillarycare angry, because the legislation explicitly stipulated that this was not to be the case. Here is the actual language from the bill: “Nothing in this Act shall be construed as prohibiting…an individual from purchasing any health care services.”

Because one of the main assertions in her highly effective article so obviously ignored this explicit statement to the contrary, for the past 20 years McCaughey has been widely painted in the general media as being totally incompetent at best, and more often as a congenital liar and/or a shill for various components of the healthcare industry. And in 2009, when she performed a similar analysis of the Obamacare legislation (coming to many of the same conclusions), she was for the most part either ignored or ridiculed.

It turns out, however, at least in retrospect, that McCaughey’s analysis of Hillarycare was largely correct.

Hillarycare Is The Model For Obamacare

Before demonstrating how McCaughey was right, I ought to say why spending any time with Hillarycare at this point is still worthwhile. Hillarycare is still relevant for two reasons. First, while Hillarycare itself never became law, many of the provisions of Hillarycare eventually did – and so, we are living under them today. And second, Hillarycare embodies the fundamental aims of any Progressive healthcare system, so understanding the aims of Hillarycare will help us to understand the aims of Obamacare (and whatever Progressive reforms might succeed Obamacare).

When House Speaker Nancy Pelosi famously pronounced that we would have to pass the Obamacare legislation in order to find out what was in it, she did not misspeak. She was not uttering a typical Nancy-ism (such as her contention that paying people not to work is a great stimulus to job creation), nor was she channeling Yogi Berra. She was, in fact, speaking the plain truth, and imparting a nugget of deep wisdom to us in the general public.

I have spent substantial time reading large portions of the 2700-page Obamacare legislation. And having done so, here’s what I can tell you about it.

The Obamacare legislation was specifically designed to be obscure; in fact, it is fundamentally indeterminate in its meaning. It was designed in such a way that the unelected regulators who would later translate it into actual rules, regulations and guidelines (under which healthcare providers can then be prosecuted), would ultimately determine what the bill really said. And until those regulators finish their work, what Obamacare actually says is a matter of debate. So Nancy was right.

This fact explains why none of our legislators bothered to read it before voting on it – except for a few pesky Republicans, who were only trying to make trouble. What’s the point in reading a long, boring document whose actual meaning will only be determined later?

This fact also raises another question. Where did this extraordinary document – whose true meaning was elusive even to the President and the legislators who were promoting it – come from? Who actually put the words to the page, and crafted this remarkable legislation?

We may never know the names of the people who actually held the pens which scratched out the actual words, any more than we will ever know the real names of the individuals who wrote the gospels of Matthew and Luke. But, just as New Testament scholars have been able to trace these two gospels to a now-lost common prior source – the so-called “Q document” – it is not difficult for anyone with a smattering of interest in the art of legislative exegesis to trace the source document for Obamacare.

The Q Document for President Obama’s Patient Protection and Affordable Care Act was Hillarycare.

In preparing to write this book, I decided to go back in time, and re-examine Hillary’s original proposal for fundamentally transforming the American healthcare system. What I found surprised me.

While Hillary’s Health Security Act was widely castigated by contemporaries as being a vast monstrosity of bureaucratic legerdemain, filled with complexity and labyrinthine passages that attempted to hide its true meaning, I found Hillarycare, in comparison to Obamacare, to be a model of legislative brevity and clarity. In fact, I now believe that its very straightforwardness is one of the things that killed it. (And, it seems obvious to me, so did whoever wrote the Obamacare legislation, an individual or individuals who so clearly and so painstakingly avoided making the same mistake.)

For instance, Hillarycare is only 1368 pages in length. How could they be so concise? Even more remarkably, Hillarycare spelled out pretty plainly what it actually meant to do.

For instance, in the Obamacare bill, in order for a reader to assemble the information necessary to determine that the Independent Medicare Advisory Board is actually to be called the Independent Payment Advisory Board (IPAB), and that its “advisory opinions” which are to be submitted to Congress for “consideration” are actually formal dictates which must be followed to the letter, and that it can inflict its cost-cutting mandates to all of healthcare and not just to government programs, one must jump around to numerous distant sections in the 2700-page document, cutting and pasting the relevant sections, jigsaw-like, into a coherent whole. In the Hillarycare bill, in stark contrast, the analogous National Health Board (which, like the IPAB, was to have been an appointed-not-elected Supreme Court of healthcare, beyond which there was to be no appeal, no revision, and no repeal) is presented in an entirely straightforward way, and pretty much all in one place.

Having now immersed myself in the relatively refreshing model of clarity and precision that was Hillarycare, I find it quite likely that the people who actually wrote the Obamacare bill (and may God keep these invaluable artists of legislative lyricism safe, as we will be needing them), simply began with Hillary’s old Health Security Act, disassembled it into various bits, padded each bit with a little more than twice its weight in verbiage, and reassembled the pieces in some nearly random fashion into the exceedingly difficult-to-read document that became Obamacare.

Obamacare’s debt to Hillarycare is obvious. Hillarycare required every American to have government-approved health insurance; it reduced private health insurers to government-directed utilities, whose products, rates, and profits were to be controlled by the feds; and it created omniscient and omnipotent panels which were to hand down dictates to “let doctors know” what services they may or may not provide and under what circumstances. This should not be surprising, since any Progressive healthcare system will ultimately have the same goals, and will likely discover similar pathways toward achieving those goals.

Hillarycare and Individual Prerogatives

So: if Hillarycare is to a large extent the model for Obamacare, and indeed, if it is a model for Progressive healthcare systems in general, then what did it have to say about the ability of individual Americans to use their own resources for their own healthcare?

Progressives have told us (and have spent nearly 20 years castigating Ms. McCaughey for telling us otherwise) that the answer is obvious – the bill says in plain language that “nothing in the bill should be construed as prohibiting an individual” from purchasing healthcare services. What could be clearer?

I humbly suggest, and ask the reader to suspend disbelief long enough to consider, that when an act of legislation makes an unprovoked, blanket assertion like this, apparently out of the clear blue, sometimes that assertion is being made in order to distract the overly curious from digging through the bill to find out what it really says, or at least, to create plausible deniability. There are lots of examples where legislation begins by saying, “This legislation does not do X,” and then immediately goes on to do precisely X.

For instance, the legislation that created Medicare contains the following language: “Nothing in this title shall be construed to authorize any federal officer or employee to exercise any supervision or control over the practice of medicine, or the manner in which medical services are provided, or over the selection, tenure, or compensation of any officer, or employee, or any institution, agency or person providing health care services.” (Section 1801, Medicare Act, 1965). This point of law, in light of what Medicare has in fact become, is mind boggling.

Also, in the Obamacare legislation, the introductory language in the section which creates the IPAB (the IPAB being a straightforward and very blunt instrument for rationing healthcare), contains language that prohibits healthcare rationing.

Then there’s the fact that Hillarycare itself, in its section on fee-for-service medicine, begins by establishing a collective negotiation process for determining what fee-for-service doctors may charge (Section 1322, paragraph (c)(2)). But then it immediately goes on to say (paragraph (c)(5)) that “collective negotiations by providers pursuant to paragraph (2) shall be considered as efforts intended to influence government action.” And efforts intended to influence government action is later defined, in the Fraud and Abuse sections of the legislation, as an act of healthcare fraud, and is subject to criminal penalties. To top it all off, the very next section of the bill also prohibits providers from boycotts or even threatening boycotts. So in effect, after asserting that there will be collective bargaining, the bill provides a mechanism for the government to dictate doctors’ fees, without input from doctors, and furthermore, these dictated fees are not even presented to doctors in a take-it-or-leave-it fashion, but rather, in a take-it-or-go-to-jail fashion.

All this, of course, is not to say that the language in Hillarycare denying that the bill has any intention of prohibiting individual prerogatives is itself definitive proof that the legislation intends to prohibit individual prerogatives. All I am saying is that such language, so gratuitously offered, may actually not mean anything at all in particular, and certainly should not be treated as being dispositive. If anything, it should make you want to read the rest of the bill with particular care.

And when we read the rest of the Hillarycare legislation we find (Section 1406, Paragraph (d)(1)) that “A provider may not charge or collect from any enrollee a fee in excess of the applicable payment amount. . .for items and services covered by the comprehensive benefits package.” When we deconstruct this language, we find that a “provider” is any individual who provides health professional services (a definition that includes all doctors); an “enrollee” is any American citizen (since all Americans are required to be enrolled in a government-approved health plan); and the “comprehensive benefits package” covers all healthcare services. So: any doctor who treats any patient in America is bound to the fee schedule as determined by the government. Furthermore, the next paragraph (paragraph (d)(2)) prohibits directly billing the patient for any of these services. The plain meaning of these provisions is that doctors and patients cannot contract with one another legally for the delivery of healthcare services.

The Fraud and Abuse sections of Hillarycare also limit the prerogatives of doctors and patients. For instance, under Hillarycare, some activities which would usually be considered compatible with routine medical practice, even when conducted within the government-approved healthcare system, created opportunities for jailtime for both doctors and patients. According to Paul Craig Roberts, writing in the Washington Times in December, 1993, “Mr. Clinton’s plan turns normal patient advocacy into a federal criminal offense. For example, a doctor who wants an earlier date for surgery for a needful patient can be accused of using wrongful influence and accepting a bribe and sentenced, along with the patient, to 15 years in prison.”

So, on one hand Hillarycare made a very direct, blanket assertion that it did not intend to inhibit individual prerogatives. On the other hand the specific provisions of Hillarycare seem to do just that. It seems likely, then, that the blanket assertion made in Hillarycare that people could buy whatever healthcare they wanted, may just be another example of employing such an assertion for the purpose of providing plausible deniablity that the legislation in fact (and in less plain language) does just the opposite.

Furthermore, the overall effect of the Hillarycare legislation, when viewed from 10,000 feet, was most striking in the detailed and minute control it assumed over each and every conceivable aspect of American healthcare. And when you consider their work product in its entirety, it becomes difficult to believe that the authors of Hillarycare would really countenance individuals going outside the system to buy whatever healthcare they wanted.

To me, this all indicates that Ms. McCaughey was probably right after all.

But since Hillarycare never became law, we can’t really know how its apparent limitations on the freedom of individuals actually would have played out.

Or can we?

After Hillarycare

As I have noted in an earlier chapter, the ignominious defeat of Hillarycare in Congress did not stop the Progressives’ efforts to overhaul the healthcare system. It simply put them on a somewhat slower track.

For instance, large sections of the onerous Fraud and Abuse portions of Hillarycare were cut-and-pasted into the HIPAA legislation which became law a few years later. We saw, in Chapter 3, just one example of how these new anti-fraud provisions were then employed to change routine medical practice into a maze of regulatory booby-traps, punishable by ruining fines and jail terms. Such methods, which were aimed at wrenching the physician’s attention away from what was best for the patient and toward what would best please the Central Authority, were extraordinarily painful for doctors at first, but in the intervening 15 years have come for many physicians – especially the younger ones who never knew anything else – to seem routine and natural. And so, despite the defeat of Hillarycare, the government has succeeded in getting physicians into the correct frame of mind for Progressive healthcare.

Similarly, the downfall of Hillarycare did not deter ongoing efforts by Progressives to limit the freedom of individuals to purchase their own healthcare. These efforts necessarily had to be relatively subtle, and accordingly have been marked by subterfuge and clever legal posing. But their aim cannot be plausibly denied.

Limiting The Rights Of Medicare Patients

Lest I mislead readers into thinking that I’m blaming only the Clintons for starting all this, I will point out that the first major effort to limit the ability of Medicare patients to purchase healthcare services outside of Medicare was effected by government bureaucrats during the administration of George Bush 41.

In 1991, Medicare administrators published a “carrier bulletin” warning physicians that direct-pay agreements between Medicare patients and doctors (even non-participating doctors) were strictly prohibited, unless the contract was initiated solely by the patient, and even then, the rate of payment for any such direct-pay agreements must be those rates set by Medicare, and further, that any such direct-pay agreements were still subject to all Medicare rules and regulations. Medicare added that if the patient at some later time became dissatisfied with that (patient-initiated) contract, Medicare would severely (and retroactively) sanction the physician. The clear aim of this new policy was to deter any direct-pay agreements, whatsoever, between Medicare patients and doctors, and thus, to limit the patients’ ability to spend their own money on their own healthcare.

When a group of physicians and their patients sued Medicare in 1992 to prevent this odious new policy from being implemented (Stewart et al. v. Sullivan), the government took the position that the plaintiffs could not prove that Medicare had really promulgated this new policy after all – since they could not “prove” that the carrier bulletin had been initiated by the Secretary of HHS. The judge agreed with the defendants over this legal technicality, and after implying that if Medicare had actually implemented such a policy (which at the time could not be “proven,”) it would indeed unreasonably limit individual rights, threw the case out in a summary judgement for lack of “ripeness.”

Then, having successfully dodged this challenge on a legal subterfuge, Medicare immediately (and cynically) rendered this very policy official, in its entirety, by formally changing its Medicare Carriers’ Manual.

But the Feds were still not satisfied. The new, restrictive policy technically still allowed for private-pay contracts, as long as the patient initiated them. So the Clinton administration engineered an amendment to the Balanced Budget Act of 1997 – Section 4507 – which prohibited any self-pay contracts whatsoever between Medicare patients and their doctors for medical services which are covered under Medicare. Under Section 4507 – which is still the law today – if a doctor provides even one self-pay medical service to a single Medicare patient, that doctor is punished by complete banishment from the Medicare program for at least two years.

The federal government was eventually challenged again in court over Section 4507, but that lawsuit was also thrown out in a summary judgment (United Seniors Association et al. v. Shalala). The rationale the government offered to the court for its actions in this case is instructive: “. . .what you will have is a system whereby the rich can buy what they want and those many beneficiaries who are on fixed income will not be able to afford those services.” So again, the interest of collective “fairness” was invoked to justify a law which stifles an individual’s fundamental right to purchase medical services he or she determines to be necessary for his/her well-being.

There are several legitimate reasons a Medicare patient might want to self-pay for a medical service that is covered by Medicare. If Medicare “covers” heart valve surgery, for instance, a patient might want to pay for a new, minimally-invasive surgical approach that is inadequately reimbursed by Medicare, rather than the big, open-heart surgery that Medicare reimburses fully. Or, one might want to self-pay for “covered” psychiatric care, or for treatment for a venereal disease, in order to keep embarrassing or harmful medical records out of government-controlled databases – that is, for privacy reasons.

Furthermore, it is important to recognize that just because a healthcare service is “Medicare-covered” does not mean that it will be covered for a given patient. Whether a specific individual is covered is often determined by a “medical necessity” ruling, made by a bureaucrat. Section 4507 essentially precludes a patient’s ability to purchase a denied (but “covered”) medical service, no matter how badly they want it, or believe they need it.

One can argue, and with some merit, that at this juncture denials of medically necessary services by Medicare have been relatively judicious, and therefore that the “Section 4507 rule” has not had much of an actual impact. In fact, it is likely that most Medicare beneficiaries do not even know that this rule exists.

But while its impact might be relatively small so far, the Section 4507 rule has now been in place for 15 years – it is very well-established. So, once Medicare begins reducing reimbursements to physicians and hospitals to the point where they can no longer afford to offer certain “covered” services to Medicare patients (and Medicare has just recently begun doing so, specifically, for some cardiac imaging studies), patients who need those services will be left out in the cold. Services which are officially covered by Medicare, but which are reimbursed at such a low rate that they cannot actually be provided to them, will become unavailable even to Medicare patients who are willing and able to pay for them.

It is conceivable that some older people who understand the implications of Section 4507, and who want to receive a covered-but-denied medical service, might decide to drop out of Medicare altogether so they could legally purchase that desired service. But this is something Progressives do not like either, because allowing patients to drop out of Medicare threatens to create an unfair, two-tiered healthcare system.

And this is why, also in 1993, the Clinton administration promulgated a rule in its Program Operations Manual System (POMS) to prohibit Medicare-aged Americans from forgoing Medicare. The rule implied that no elderly person could drop out of Medicare unless they also gave up their Social Security benefits, and repaid any Social Security benefits they had already received.

Recently, this POMS rule was challenged in a lawsuit filed by three elderly Americans (one of whom was Dick Armey) who wished to drop out of Medicare in favor of self-purchased health insurance, without having to sacrifice their Social Security benefits.

But in the summer of 2011, Washington DC District Judge Rosemary Collyer ruled for the defendants and upheld the POMS rule. So: elderly Americans do not have the right to drop out of Medicare and purchase their own health insurance, unless they also forgo and repay all Social Security benefits.

Interestingly, in 2009 Judge Collyer had denied a motion by the Obama administration to dismiss the suit, and in her denial pointedly noted that “neither the statute nor the regulation specifies that Plaintiffs must withdraw from Social Security and repay retirement benefits in order to withdraw from Medicare.” Her preliminary ruling thereby confirmed the plaintiffs’ main contention. So most observers had assumed that the judge’s final ruling would also be in favor of the plaintiffs.

It was not. In her final ruling in 2011, Judge Collyer found a new interpretation of the Medicare statute itself that upholds the POMS rule. The Medicare statute, she finally determined, specifies that people who are entitled to Social Security are automatically “entitled” to Medicare, and therefore if one elects to receive the Social Security payments one is owed, one must also accept Medicare. She flatly rejected the notion that when Congress says “entitled” it is implying anything optional, as in, “You can have it if you want it.” When you’re dealing with Medicare, she said, “‘entitled’ does not actually mean ‘capable of being rejected.’” So, when Congress creates a new entitlement, Congress actually means you must have it – that it’s mandatory. Judge Collyer ended her ruling by sympathizing with the plaintiffs (or laughing at them – I cannot tell for sure): “Plaintiffs are trapped in a government program intended for their benefit.”

The apparent change in Judge Collyer’s reading of the Medicare statute between 2009 and 2011 is disturbing. What made her originally read the plain language of the Medicare statute just like any literate American would, but then two years later read it as if she had to twist it into a presupposed “right” answer? We likely will never know what induced this marked shift.

It is instructive that the Obama administration would go to such lengths to prevent old people from dropping out of Medicare. Medicare is not only in the red, but is a great fiscal threat to our national well-being. One would think they’d welcome the idea that some of our elderly might want to pay for their own health insurance, and thereby save Medicare a lot of money. But instead, the administration fought the idea tooth and nail, to the point of articulating absurdities that even the judge could not refrain from mocking. One of the Obama administration’s arguments, for instance, was that the plaintiffs were lucky to receive such a boon as Medicare, and therefore suffered “no injury” by having to accept it. The judge responded in her ruling: “The Secretary extolls the benefits of Medicare and suggests that Plaintiffs would agree they are not truly injured if they were to learn more about Medicare. . .The parties use a lot of ink disputing whether Plaintiffs’ desire to avoid Medicare is sensible.”

So as it now stands, seniors (unless they are rich enough to also walk away from Social Security altogether) must accept Medicare. Admittedly, for most elderly Americans this is not a big deal – of course they’re going to accept Medicare. But, as we have seen, current law already makes it nearly impossible for patients on Medicare to self-pay for denied medical services. Once you are on Medicare, you will get the medical services the Central Authority approves for you – and nothing more. In the not-too-distant future, this restriction is likely to become much more apparent to Medicare recipients than it has been to date. When and if the day comes when we would like to buy ourselves some medical care which the Central Authority would rather we did not have, Old Farts like your author will find that we are “entitled” neither to pay for our own healthcare, nor to drop out of the government program that so restricts us.

Preventing Doctors From Adopting Direct-Pay Practices

Disturbed by the destruction of their professional autonomy, and by their inability to advocate for their individual patients, for the past decade more and more doctors have been dropping out of the “system,” and establishing practices under which they are paid directly by their own patients. By eliminating the pressure from insurers and the government to make the patient’s best interest a secondary concern, direct-pay practice immedidately restores the classic doctor-patient relationship, and therefore restores professional integrity – and so it is a menace to Progressive goals.

Unfortunately, direct-pay practitioners have a serious public relations problem. Part of the problem, to be sure, was caused by these doctors themselves. The first few to set up this new style of practice unabashedly catered to rich patients, and to attract the rich, referred to themselves as “concierge” practitioners. This name (and its elitist connotations) have been forcibly affixed to all direct-pay practitioners, even as this style of practice has evolved into a much more democratic form. Today, more and more doctors are starting direct-pay practices which are easily affordable to anyone who can afford a cell phone or cable TV contract. This evolving variety of direct-pay practice is actually not so radical as Progressives would have you believe. It is the way doctors practiced medicine until very recently. It is, in fact, the way Dr. Welby practiced medicine.

While many direct-pay practices offer patients certain benefits they usually cannot get from primary care doctors who remain in the approved system (such as phone and e-mail access, same-day appointments, appointments lasting as long as necessary instead of the allotted 7.5 minutes, &c.), the fundamental benefit, to both the patient and the doctor, is that it restores the classic doctor-patient relationship. The physician’s primary obligation is no longer to the 3rd-party overlord, or to the Progressive ideal of social justice, but to the patient.

And while critics (who abound) attack direct-pay practitioners for their elitism, laziness, and greed, their real issue is that direct-pay practitioners are acting as if their primary duty is to their individual patients, and not to “social justice.” It is for this reason that direct-pay practices are a deadly threat.

Having gained nearly complete control over the behavior of primary care practitioners, it is critical for Progressives to shut the door to any alternative forms of primary care. Direct-pay practitioners are a menace because they threaten to raise the expectations of both doctors and patients. Perhaps, doctors might tell themselves, there really is a way to maintain our professional autonomy within the healthcare system. Perhaps, patients might tell themselves, there really is a way for me to have a personal advocate watching out for my interests when I have to interact with the healthcare system.

The issue, as always, is one of “fairness.” It is not fair for rich people to be able to buy “extra” access to their doctors, since it will create a condition of inequality. The policy director for the AARP (an organization that is ostensibly intersted in the best interests of older Americans) has said that direct-pay practices creates “the prospect of a more explicitly tiered system where people with money have a different kind of insurance relationship than most of the middle class, and where Medicare is no longer as universal as we would like it to be.” It is apparent that, to assure fairness, no patient should have email or cell-phone access to their doctors, or same-day appointments – or to a true professional advocate who is dedicated to their own individual interests, instead of the competing interests of the whole.

The attacks on direct-pay practitioners have followed the usual scheme Progressives follow when they discover an idea they need to suppress. First, they were ridiculed. “For a Retainer, Lavish Care by ‘Boutique Doctors,’” said a headline in the New York Times in 2005. Then, they were demonized, widely attacked for their elitism, for catering to the frivoulous desires of the rich, and for their lack of fundamental medical ethics. In this latter effort, it was not difficult to find fellow physicians – generally, from the medical organizations which promulgated the New Medical Ethics (see Chapter 3) – to lead the attacks. There are countless examples. I will give just two.

Anthony DeMaria, then President of the American College of Cardiology, criticized the practice of direct-pay medicine in an article in the Journal of the American College of Cardiology in 2005, saying, “Personally, I do not mind if people acquire yachts or personal trainers if they have enough money, nor would I object if they secured a physician at their beck and call. However, unlike yachts, health care is not discretionary, and everyone should be entitled to the same quality.” So, direct-pay physicians improve the quality of healthcare only for only some patients (i.e, for their own patients), and so have no place in the healthcare system.

In a 2002 article in the New England Journal of Medicine, Troyen A. Brennan M.D., J.D., and M.P.H., really gets to the point. Referring to direct-pay practices as “luxury primary care,” he notes that “traditional medical ethics is rather poorly equipped to address issues related to luxury primary care.” That is, while “traditional” medical ethics always places the individual patient first, that kind of thinking is now outmoded. “(M)ost ethicists now agree that the financial structure of health care is an important subject for ethical consideration. Access to health care, in particular, is a salient ethical issue.” Direct-pay practitioners threaten (by their elitism and the limited size of their practices), to limit access to primary care, and thus are in fundamental violation of medical ethics.

The argument here, for those who missed it (advanced by fellow physicians no less), is that, of the two competing ethical precepts now established by New Medical Ethics (i.e., the physician’s obligation to the individual patient vs. the physician’s obligation to society), clear primacy is to be given to the physician’s obligation to society. Physicians must (like it or not) place the needs of society above the needs of the patient – and participate in covert bedside healthcare rationing. Physicians who take the only path remaining to them that allows them to make the individual patient their primary obligation are to be castigated as ethically deficient.

When ridicule and demonization fail to suppress their opposition, Progressive dogma indicates it’s time to resort to force. The first pass in this regard, of course, is always to render the opposition illegal. (Actual violence is reserved for criminals who persist in their misbehavior, despite more polite efforts to get them to behave lawfully.)

Making direct-pay medical practice illegal has not been accomplished yet, but clear efforts have been made in this regard. Noting with alarm the rise of direct-pay primary care, numerous Congresspersons have issued statements of concern, suggesting that perhaps Congress should “look into” the propriety of such activities.

Indeed, the first step by Congress has already been taken. In 2003, as part of the Medicare Prescription Drug, Improvement, and Modernization Act, Congress directed the GAO to study and report on the effect of direct-pay practices on Medicare patients. The GAO did so in 2005, and a fair paraphrase of its report is as follows: “The practice of direct-pay medicine is not currently a threat to Medicare patients, because the direct-pay movement is not large enough yet to have an impact. If it does begin to have an impact on Medicare patients, action will have to be taken.” That is, direct-pay medicine was considered OK in 2005 not because it was inherently an ethical and legal form of medical practice, but simply because there were not enough practitioners at that time to bother about. The clear implication is that Congress stands ready to pass laws outlawing – or, at least, severely limiting – direct-pay practices, as soon as those practices begin to “impact” the system.

A follow-up report was done in 2010 which showed a 5-fold increase in the number of direct-pay practices since 2005. It is not yet clear what actions the Feds may take – the numbers are still quite small – but leaders of MedPac (a commission that advises Congress on Medicare) has publicly expressed alarm that this new phenomenon appears to be growing rapidly.

Certain state governments are not waiting for Congress to ban direct-pay practices. The state of Maryland and a few others have taken the creative position that, because many direct-pay practices work on a retainer basis, they meet the definition of a health insurance company. And as a health insurance company, to be considered legal entities, they have to have millions of dollars set aside to pay for unforeseen “claims.” (Interestingly, the lawyers in state legislatures who are advancing this argument have never suggested that the same rules be applied to attorneys, who also often work on a retainer model.) According to the Baltimore Sun, the state’s stance in this regard has already successfully caused several primary care physicians to abandon their plans to become retainer practitioners. This interesting pathway to banishing direct-pay practices is being taken up by other states, as well. In early 2012, for instance, the state of Oregon also began requiring direct-pay physicians to register their practices with the state insurance commission.

Less devious (but more draconian) is the action that was proposed in the state of Massachusetts (whose universal healthcare system, we’ve all heard, is a preview of Obamacare circa 2015). A bill was introduced in 2009 in the Massachusetts Senate which would require doctors, as a condition of their licensure, to accept payment rates as determined by the government. The bill has not become law in Massachusetts (not yet, anyway), but its introduction illustrates the tactics which are being entertained to make direct-pay practices completely impracticable, if not illegal.

Since medical licensing is controlled by the various states, it would take 50 bills like the one proposed in Massachusetts to really get rid of direct-pay healthcare. But there are ways for the Central Authority to accomplish this goal much more expeditiously. Now that the federal government directly controls all student loans, for instance, it would be a simple matter to make student loans for medical students contingent on agreeing to become primary care doctors working strictly within the government controlled system, or to offer loan forgiveness for doctors who agree to do so, or to rescind favorable re-payment conditions (retroactively, and decades after the fact, if necessary) for doctors who go to a direct-pay model later in life.

Even without taking such action, the Central Authority may already have poisoned the water for direct-pay practices. Attorneys representing direct-pay practitioners think they have discovered a potentially fatal problem within Obamacare. Under this law, apparently only physicians enrolled in Medicare can order durable medical equipment or home health services for Medicare patients. Worse, the language of Obamacare may award to the Secretary of HHS the authority to expand this limitation to all other medical services they might order. If direct-pay physicians are banned from ordering any medical services for their patients, it is difficult to see how their practices can remain viable.

Direct-pay practices are the last, best hope for patients who want their own individual interests looked after, and for their doctors who want to practice their profession ethically. This is why Progressives are determined to terminate them with extreme prejudice.

What Do Contraceptives Have To Do With All this?

In early 2012, President Obama unleashed a firestorm when he ordered HHS to issue a directive requiring all organizations providing health insurance to their employees to cover contraception, “morning after” pills, and sterilization procedures. This directive stunned the American Catholic leadership, whose support for the Obamacare legislation (they tell us) was predicated on assurances that healthcare reform would never require Catholic institutions to violate their fundamental principles. The bishops, and many American Catholics, felt betrayed.

Some felt personally betrayed. Cardinal Timothy Dolan had met in the Oval Office with the President in November 2011 to discuss this very issue, and was assured by Obama’s own lips that the administration was committed to protecting the church’s principles. This new directive, Cardinal Dolan said after the President’s directive on contraceptives, “seems to be at odds with the very assurances that he gave me.” (This is as close as a Cardinal may come, when speaking of the President, to saying, “He lied to me.”)

Progressives were delighted with the new rule, which put the principles of religious belief into their proper place. Conservatives, however, along with Catholic leaders and leaders of other religions, expressed outrage at the President’s directive, which was a clear assault on religious freedom in America.

The President was ready for them. Supported by his allies in the American media, he portrayed objections to his new directive as a “Republican War on Women.” It is instructive to consider the basic premise of this War on Women, to wit: By objecting to the new directive, Republicans are saying that women should not have access to contraceptives.

This twist of logic seems completely absurd, from almost any perspective.

Almost.

If there is one aspect of healthcare services to which American women have plenty of access, regardless of their income levels, it is contraceptive services. That is why we taxpayers fund Title X Family Planning Services, and also why we fund Planned Parenthood. And for any woman who does not wish to avail herself of this taxpayer-funded access to contraception, Walmart sells birth control pills at $10 for a month’s supply. There is no lack of ready access to contraception.

Indeed, if Republicans really wanted to prevent women from having contraceptives, objecting to the President’s new directive would not be of any material help whatsoever in accomplishing such a goal.

But there is, in fact, one perspective from which blocking the President’s directive would indeed limit womens’ access to contraceptives. If one approaches the issue from this perspective – and only if one approaches it from this perspective – then the idea of a War on Women makes logical sense. Furthermore, when we listen to the passionate, heart-felt and indeed almost tearful arguments that are being made by Progressives against the heartless Republicans – vociferously denying that Republicans care anything about religious freedom or constitutional authority, and insisting instead that they only want women to be denied contraceptives – it seems plain that this is, in fact, the perspective which Progressives must necessarily hold.

That perspective is: Anything that constitutes healthcare MUST be provided by government-approved insurance products, since if it is not provided by government-approved insurance products, one cannot legally acquire it.

So, in fact, the controversy over whether religious organizations must provide insurance that covers contraceptives boils down to the notion that people should not have to – and indeed should not be permitted to – purchase healthcare services on their own.

The President’s directive on contraceptives, therefore, seems to have been issued in order to establish, once and for all, the essential set of foundational principles for Obamacare, to wit:

1) The government will determine what constitutes healthcare and what does not.
2) If the government says it’s healthcare, every insurance product must cover it.
3) If it’s not covered by insurance, thou shalt not have access to it.

Women must be provided contraceptives without paying for them NOT because there are so many women going without them today, due to insufficient access. Rather, women must be provided these services without paying for them because we cannot allow women (or any patient) to pay for these services (or any service the Central Authority classifies as “healthcare”) out of their own pockets.

All healthcare services must be covered by all insurance products – regardless of which institutions provide those insurance products – precisely because nobody can be permitted to pay for healthcare outside the sanctioned insurance product.

This is the principle which is being established by the President’s new directive. This principle, so critical to Obamacare and to the Progressive agenda, is a principle worth fighting for. None of the other explanations offered by proponents or opponents of the President’s action make any sense.

Summary

My main point, once again, is that the Central Authority has a deep and abiding need to limit our individual prerogatives when it comes to our healthcare, and has been acting on that need for a long time. The basis for these limitations on our individual liberties – the principle of social justice – has already been established, and has survived court challenges.

Extending these limitations on personal liberties to Obamacare, and broadening their usage, will not require any major changes in direction, or principles, or policy, but will merely require an expansion of already existent – and even “venerable” – rules, rules which have been an established part of Medicare for many years.

Such restrictions by our government on such fundamental individual liberties are a very big deal indeed, and, in fact, signal an end to the Great American Experiment.

When I have expressed this conclusion in the past, many critics have admonished me that I make far too much of it, and that our government, in its benign wisdom, is just doing what’s best for us. I beg readers to forgive me if I see, in such a reply, even more evidence that the only nation in the history of mankind to be founded on the principles of individual freedom is well on the way to abandoning those exceptional principles, for the sake of the same, soothing-but-empty blandishments that have been offered, throughout human history, by well-meaning people who end up producing – or becoming – tyrants.

This is Chapter 6 of my book-in-progress, “Open Wide And Say Moo! – The Good Citizen’s Guide to Right Thoughts And Right Actions Under Obamacare.” This chapter opens Part II of the book. Comments are fervently sought; you can leave them here.

You can read my rationale for undertaking this project, and thus opening myself up to the possibility of public failure, humiliation, derision, disapprobation, and unwanted scrutiny, here.

And here is the up-to-date archive for all the chapters that have been posted so far.
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Part II – What We Can Expect From Obamacare

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Chapter 6 – Some Implications Of A Right To Healthcare

Apoplexy is a frequent condition among Conservatives today. This is because triggers abound.

And, among these fine Americans, one of the more common and more malignant triggers of apoplectic vocalizations is the assertion that healthcare is a right.

To a Conservative, a right is an attribute that accrues to every person naturally, by virtue of the fact that they are members of the human race. Such natural rights, which invariably are rights to take some action, are are considered to descend from the Creator (as the Declaration of Independence asserts), or at the very least from the inherent nature of the universe, and thus are not subject to addition or subtraction by any human authority – such as by governments. And because natural rights are granted equally to every human, it is an inherent truth that there can be no such thing as a right that imposes obligations or limitations on the natural rights of others. Indeed, the very notion that a right can exist that imposes such obligations on another person is an utter abomination.

Progressives see rights differently. To them, a right is not a right to act, granted by nature, but rather, it is a right to receive something (invariably the product of another’s actions), granted by a man-made Central Authority.

And hence, apoplexy.

Franklin Roosevelt started it. In his 1944 State of the Union message, he said:

“This Republic had its beginning, and grew to its present strength, under the protection of certain inalienable political rights – among them the right of free speech, free press, free worship, trial by jury, freedom from unreasonable searches and seizures. They were our rights to life and liberty.

As our nation has grown in size and stature, however – as our industrial economy expanded – these political rights proved inadequate to assure us equality in the pursuit of happiness.

We have come to a clear realization of the fact that true individual freedom cannot exist without economic security and independence. Necessitous men are not free men. People who are hungry and out of a job are the stuff of which dictatorships are made.

In our day these economic truths have become accepted as self-evident. We have accepted, so to speak, a Second Bill of Rights under which a new basis of security and prosperity can be established for all, regardless of station, race, or creed.”

Roosevelt then proposed, in his Second Bill of Rights, that each American is entitled by rights to:

- A living wage
- Freedom from unfair competition
- Housing
- Education
- Social security
- Healthcare

All this, of course, just goes to show how bad an idea the Bill of Rights was from the very beginning. If I had been around in 1789, I would have counseled Mr. Madison thusly: “Jim, don’t do it. You have crafted a perfectly good Constitution already. It carefully enumerates the very few powers which We the People have granted to the Federal government, and it explicitly states that any such power not so granted herein is specifically NOT available to the Feds. If you go amending the thing, before it ever gets going, with a list of specific things the government cannot do to us, you will undermine that overarching prohibition. Your list of restrictions on the government’s power will necessarily be incomplete, and eventually proponents of big government will notice, “It doesn’t say we can’t do this.” And furthermore, even your enumerated prohibitions will be quibbled with, twisted, and reinterpreted over time, in a very lawyerly fashion. And the next thing you know (say, in a quarter millennium or so), you’ll have a huge, powerful Federal government doing all kinds of nasty things to We the People (though no doubt only with the best of intentions), and referencing your fine Constitution as their authority for doing so.”

The Bill of Rights, as President Obama has noted, is a negative list. It enumerated specific items, which were particularly important to Americans at the end of British rule, which the government was not permitted to do to the people.

Franklin Roosevelt turned the whole concept of the Bill of Rights on its head – his was a list of items the government was required to “provide” for the people. His formulation was masterful, and it is a formula that has been carried forward by Progressives to this day. He claimed to derive the authority for his new Bill of Rights from the Declaration of Independence itself, saying that the “pursuit of happiness” requires everyone to have (i.e., to be given) this whole list of stuff, thus neatly eliminating the need to “pursue” the happiness in the first place. He added that failing to provide these rights will lead to dictatorship, ignoring the very reason for the original Bill of Rights – that any government with the power over individuals necessary to provide all these “rights” will itself have to be an extremely authoritarian one.

In any case, Roosevelt’s Second Bill of Rights has been the Progressive’s Shining City on a Hill for nearly 70 years. And it graphically illustrates how differently the Progressives view “rights.” (Conservatives will note that it is entirely possible to address the problem Roosevelt invoked – an unreasonable inequality of opportunity – without creating any new “rights” that will forever increase the power of the government over the people.)

American Progressives generally do not explicitly deny the existence of “natural rights” altogether. (Doing so would cause them embarrassment when they assert their own inalienable “truths,” such as the superiority of Diversity over all other human virtues). But at their core Progressives do not (and cannot) actually subscribe to natural, God-given rights that accrue equally to every person. This is because in the Progressive Program, rights are attributes granted by a Central Authority, aimed at achieving the social justice which is necessary to a perfect society. Therefore, almost by definition, Progressive rights are differential rights. That is, they are rights that, for the sake of social justice, must be at least somewhat different among various defined groups, and accordingly, not only must such rights be actively manufactured, but also they must be appropriately assigned and carefully distributed.

Natural rights granted by some sort of Creator obviously cannot handle such a job. Only a Central Authority can do this.

“Rights” granted under the Progressive Program will necessarily create involuntary obligations upon at least some individuals, at the very least confiscating the products of their efforts, and therefore from the Conservative point of view will always fundamentally violate the essence of what is truly a “right.” A Progressive may or may not be willing to allow that a few natural rights may exist; but they won’t let such rights hinder them. This is because rights granted by the Central Authority, deriving from political power*, take precedence; and any “natural rights” can simply be suspended whenever necessary.

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* As Ron Bloom (President Obama’s former Manufacturing Czar) explained, “We kind of agree with Mao that political power comes largely from the barrel of a gun.”
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Nothing pleases Progressives more than an opportunity to grant a new right. Every time they do so, the Central Authority gathers yet more power over the actions and the property of individuals, and therefore becomes more capable of moving us all toward societal perfection.

In Part I of this book, I tried to describe the American healthcare landscape as we enter the era of Obamacare. Here in Part II, I hope to show what we should all expect from Obamacare. And the first thing we need to know in this regard is that the passage of Obamacare, for its proponents at least, finally establishes healthcare as an American right, and thus achieves a goal which has been an explicit part – and likely the most critical part – of the Progressive agenda since at least 1944.

This accomplishment – establishing healthcare as a right – carries with it certain implications.

What Is Healthcare, Anyway?

When healthcare is a right, then for the very first time, that which constitutes “healthcare” will have to be explicitly defined. This is because if a medical service is deemed to be “healthcare,” then people have a right to it. Conversely, if a medical service is deemed not to be “healthcare,” then not only don’t people have a right to it, but they also should not have access to it. (If people were allowed access to medical services that the Central Authority deems not to be “healthcare,” people might get the idea that the Central Authority is holding back on them. And that would be a dangerous idea indeed.)

So you can see how important it will be to define, specifically, what healthcare is – and what it is not. Since the Central Authority will be administering the right to healthcare, naturally the experts appointed by the Central Authority will be the ones who will be doing this job.

It will be a job as difficult as it is important. For instance, most people would agree that medical services that aim to prevent disease, restore health, optimize functional capacity in the face of illness, or control symptoms, ought to be included under the umbrella of “healthcare.”

But nitroglycerin and stenting can both relieve angina. One is very cheap and marginally satisfactory; while the other is very expensive and usually much more effective. Should both constitute healthcare, or only one? An expensive new drug prolongs survival with a certain type of cancer by an average of six months. Is that healthcare?

Is a treatment that does not actually cure or ameliorate a disease, but, that, say, slows the normal aging process, to constitute healthcare? If not, we should put a stop at once to the large volume of research currently being done on the aging process.

What about other treatments that enhance the life of individuals in the absence of serious disease or disability, such as face-lift surgery, hair transplantation, Lasik surgery, oral contraceptives when used for the express purpose of preventing pregnancy, or Viagra? Should those be healthcare?

And then there are conditions famously subject to “disease creep” – such as autism spectrum disorder, or ADHD, or even obesity – conditions for which the diagnosis has been increasingly expansive, so as to roll in more and more people who, in earlier times, would have been considered variants of normal. Should treatment of those conditions be considered healthcare?

Since the availability or non-availability of treatment will likely hinge on the answer to this question, there will be a lot of pressure, in both directions, on the Deciders. If it were not for the fact that the people who will be doing this job will be entirely objective and totally non-conflicted government-appointed experts, the process of deciding what is and what is not “healthcare” would be quite worrisome.

All Rationing Will Have To Be Covert

Since healthcare is a right, useful healthcare obviously cannot be withheld. Therefore, all the healthcare rationing that is done under Obamacare will have to be covert.

Under Obamacare many of the methods of covert rationing which were traditionally used by health insurance companies (e.g., cherry-picking, driving sick subscribers away, rescission, &c.), will not be available. This means that other covert rationing techniques will have to be developed.

Thankfully, physicians will be a big help here, since their New Ethics makes it OK for them to ration healthcare at the bedside. So it will be important for Obamacare’s administrators to continue establishing incentives for doctors to withhold medical care.

But to really cut down on healthcare expenditures, a lot of creativity will be needed. Fortunately for the Obamacare administrators, while they do not have all the options that were available to the HMOs, they do have the wind of the sovereign authority in their sails. They will be able to try new things that the HMOs could only dream of.

Here is a brief survey of what some of those “new methods” will be. I will be discussing the more remarkable ones in detail in the following chapters.

Centralized Decision-Making

The big driver of medical expenses, as we have seen, arises from individual doctors making independent spending decisions along with their individual patients. And even though the Central Authority can coerce doctors all day long to withhold expensive medical services, the HMOs graphically demonstrated that you simply can’t coerce doctors enough to make a real dent in skyrocketing healthcare expenditures.

Fortunately for the Central Authority, a right to healthcare naturally leads to a situation in which all those spending decisions must be centralized. After all, a thing so noble as a right to healthcare – with the comprehensive fairness that is demanded by such a right – cannot possibly be achieved by hundreds of thousands of individual doctors acting independently. Comprehensive fairness absolutely requires central direction.

As a bonus, of course, centralized control of the healthcare system also gives you the opportunity to cut costs.

Centralized decision-making is a hallmark of Obamacare. The most notable features of centralization in Obamacare include:

1) The Independent Payment Advisory Board. The innocent-sounding IPAB (for how much damage can any mere “advisory” board do?) actually represents a truly astounding attempt to create a nearly all-powerful, unelected, immutable (in the sense that no governmental body can terminate it) board which will determine the ceiling for all of America’s healthcare expenditures.

2) GOD panels. Numerous expert panels will be created – which observers less sophisticated than myself have referred to as “death panels,” but which I choose to call by the much less insulting and much more justifiable name of GOD panels (“Government Operatives Deliberating”) – for the purpose of publishing the clinical “guidelines” that will tell doctors which specific patients can get which medical services, and when and how they can get them.

3) Stifling preventive medicine. While preventive medical services might actually prevent a disease here or there, the Central Authority has figured out that preventive services of all kinds, without exception, will always cost far more money than they can ever save. So Obamacare has instituted new processes to limit preventive services, and (as you will already have noticed if you are paying attention) to indoctrinate us in the great unwashed that expensive preventive services actually do more harm than good.

4) Herd medicine. A natural by-product of a system in which medicine is practiced strictly according to centrally determined guidelines is that all patients with a particular disease process will be treated the same way. The treatment guidelines generally will reflect clinical studies that report on the average response of patients given treatment A as compared to the average response of those given treatment B. Thus, treatment guidelines will necessarily be directed toward the average patient. If you are interested in improving the average outcome for the entire herd of patients, this might be a good thing to do. But for patients themselves, (who are still stuck on the idea of optimizing therapy for each individual, and 50% of whom will necessarily fall on the wrong side of “average”), this could be very bad news.

5) Slow medical progress. As we have seen, it is runaway medical progress (along with the greedy doctors) that has created this whole mess in the first place. Therefore, making it as difficult as possible for innovators to get their new products to market is a critical feature of the Central Authority’s strategy.

Group Medicine

Group medicine, which is analogous to Diversity, is different from herd medicine. Group medicine means that different groups of patients (grouped according to one or more characteristics) need to be treated differently from other groups of patients, even if they have the same medical disorders.

Within each designated group, of course, herd medicine will apply.

An example of group medicine is life-cycle medicine, in which your relative priority to receive medical services is related to your position within the life-cycle. One system that has been suggested by a prominent advisor to President Obama would award persons under the age of 5 and above the age of 65 a relatively low healthcare priority, those between 5 and 14 and between 55 and 65 an intermediate priority, and those between 15 and 54 the hightest priority. Such a system would assure that fewer healthcare expenditures are used to help individuals who are not actively contributing very much to the collective.

Another example would be caring for people who are deemed to be at or near the end of their life. While thoughtful and compassionate end-of-life care can be a great boon, when it is implemented primarily as a cost-saving measure it is open to many abuses.

And then there is the variety of group medicine in which individuals are grouped according to their inherent worthiness, as judged by some feature other than age. Presently, the group known as “the obese” is serving as a test case. If our leaders can set a precedent of implementing medical discrimination against fat people, it will be relatively easy to expand the concept greatly.

Controlling Individual Behaviors

Successfully demonizing the obese will set a precedent that goes beyond merely establishing group medicine. Fat people are fat, we are told, because of the choices they make (such as the choice to be slothful and gluttonous), and because of these choices they are consuming far more than their fair share of healthcare. This “fact” is already beginning to lead to regulations that propose to control food choices.

If the Central Authority succeeds in making this case – and they probably will, since who cares about fat people? – they can use the same argument to regulate any other human behavior that they decide might influence a person’s odds of having to consume a bit of healthcare. Some of these behaviors (in addition to what you eat) might conceivably include your hobbies, listening to advertisements for unhealthful products, the number of miles you drive, or owning a firearm.

Limiting Individual Prerogatives

I have said earlier that the key battle, the one most likely to determine the outcome of whether Americans will retain at least some semblance of individual freedom, or whether the Progressive takeover of our healthcare system – and of our society – will be complete, will be in regard to whether individuals will retain the ability to purchase at least some of their healthcare with their own money (and also, necessarily, whether providers will be able to sell it to them).

The very fact that healthcare is now a right means that it must be provided for you; you should not have to provide it for yourself. And this is how Progressives state their case. But what they really mean is that you should not be permitted to provide it for yourself.

I understand how outlandish this sounds. I also understand that almost nobody seems to be talking about it – so how can it be the case?

Well, I will show you. And since, as I maintain, this question occupies the key position in the battle over healthcare and in the battle over individual freedom, I will get right to it, and show you in the next chapter.

Summary

Every new “right” granted to citizens by a Central Authority, while it may or may not succeed in providing the promised thing to the citizens, will always expand the power of the Central Authority over the liberty of individuals. In the case of a right to healthcare, as we have seen, it is simply not possible to provide “the promised thing” in its entirety to everybody. And worse, in the case of healthcare, the very essence of individual liberty is direly threatened.

This is Chapter 4 of my book-in-progress, “Open Wide And Say Moo! – The Good Citizen’s Guide to Right Thoughts And Right Actions Under Obamacare.” Comments are fervently sought; you can leave them here.

You can read my rationale for undertaking this project, and thus opening myself up to the possibility of public failure, humiliation, derision, disapprobation, and unwanted scrutiny, here.

And here is the up-to-date archive for all the chapters that have been posted so far.

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Chapter 4 – The Four Ways To Control Healthcare Spending

In the first three chapters of this book, I have attempted to show how and why our nation’s healthcare expenditures have become entirely untenable, and why the heroic measures we have taken so far to contain those expenditures have been not only an abject failure, but also quite counterproductive. Indeed, the cost-containment measures at which we have been flailing away for twenty years (primarily employing the multfarious techniques of covert rationing) have left more than merely our treasury in a “spent” state.

Our health insurance industry has worn itself down to a still-blustering but empty shell. And our physicians have allowed themselves to be reduced to an abject community of supplicants. In neither the insurers nor organized medicine are we likely to find the ideas, the energy, or in any manner the wherewithal that will be necessary to lead us toward a real solution to the mess we have made of our healthcare system. At best, they will be followers.

It is true that our political leaders are certainly not spent. Our Progressive leaders, using their typical end-justifies-the-means approach to the Constitution, have made Obamacare the law of the land. And our Conservative leaders are invigorated with the idea of nullifying that law in the courts, or repealing it after the next election.

But amidst all the accusations and counter-accusations, vituperations, abuse, and scurrility that passes for debate between these two factions, neither faction has clearly articulated its plan for controlling our healthcare expenditures.

Any Progressive healthcare system – including Obamacare – will of course have an inherent, built-in methodology for reducing expenditures. Namely, government-approved experts will determine that some healthcare services will not be provided to anyone, and that other services will not be provided to some. But our Progressive leaders do not like to talk explicitly about that methodology in public. So instead, they talk about fairness, reducing the number of uninsured, and stifling the greedy doctors and biomedical companies.

With a few notable exceptions, Conservatives seem to be in an even sorrier state, since they seem to be relying on the health insurance industry and a vague notion of “free markets” to take care of everything once they get rid of Obamacare. They seem not to realize that we have already tried this strategy, and it has failed abysmally. This kind of talk most likely frightens health insurance executives more than anyone else.

Worse, the less-than-useful debate that has taken place between the two parties – with neither party forthrightly addressing the kinds of actions that will really be necessary to rescue our healthcare finances (and thus our society) – has created a general sense among the public that the problem is so confused and chaotic, so rifled by conflicts of interest, and so very complex, as to be fundamentally unsolvable. If that were the case, it would mean that our society is doomed, and in the relatively near future.

I myself have suggested, just a chapter or two ago, that this outcome does not seem particularly unlikely at this moment.

However, there are, in fact, solutions to our healthcare spending crisis, and so descending into chaos is not the only possible outcome. In fact, I will assert in this chapter that there are actually four (but only four) entirely different ways to meaningfully reduce our healthcare expenditures.

By understanding these four methods of solving the problem, it is entirely possible – as we listen to all the debating, fighting, and reciprocal castigations, aspersions, distortions and lies being exchanged by and amongst the various interest groups – to understand which method is actually being espoused by which parties.

We have, obviously, already settled upon one of these methods, at least for now. Obamacare is a nice example of Method Two – the Progressive plan. We have settled on it above the others, I believe, because it is easiest (if you do not dig too deeply) for its proponents to make Method Two sound a lot less difficult, a lot less painful, and a lot more fair than the other methods. Indeed, while the people “selling” Method One or Method Three (nobody is trying to sell Method Four) usually make it sound like they’re asking us to pick the least bad of all the bad choices, proponents of Method Two are true proselytizers. They honestly believe that their option will represent a pinnacle of human achievement (and thus, that people who disagree with them are tools of the devil).

As I have already stated, I believe the Progressive viewpoint is dangerously incorrect. Before giving a detailed picture of why I think this is the case, it is only fair for me to briefly review all the alternatives that will remain to us if we should decide to turn away from the Progressive style of healthcare reform.

And so, without further ado -

Method One: Make All Healthcare Spending The Responsibility Of The Individual.

That Method One, when baldly stated as I have just done, seems so outlandishly inappropriate and hard-hearted today is a tribute to just how far down the Progressive path all of us have already traveled. But it is, in fact, a legitmate method for getting control of our national healthcare expenditures.

Further, the necessity of paying ouselves for products and services we consume ourselves, as we have seen, is a fundamental law of economics. And, as our society is about to learn, while we can get away with violating this law for a couple of generations, we cannot get away with it forever.

Also consider the fact that, just a few decades ago, this is exactly how we all paid for healthcare. Indeed, this is the method by which all of mankind has paid for its healthcare for all but a few brief decades out of the millions of years we have graced (or plagued, if you must) the planet. It has always been thus: If you want or need healthcare (and if it exists), simply pay for it yourself.

Those few brave souls who remain proponents of this method – who often count themselves as Libertarians – offer two general arguments to support their position; an ethical one and a practical one.

It is fundamentally unethical to insist that your own individual healthcare services must be provided by others – claiming, as you do so, that healthcare is somehow intrinsically different from any other product or service which you may wish to acquire (such as food, clothing, housing, and iPads). Proponents of Method One quaintly cling to tne now-outmoded idea that there is no such thing as a right that creates an obligation upon another person. So to them, insisting that healthcare is a right that must be provided by others is, a priori, unethical. Furthermore, they point out, much of a person’s health (and therefore, a person’s healthcare needs) is determined by lifestyle choices, so it is only right and proper for the individual to bear responsibility for those choices. But more importantly, demanding any “right” that creates a burden on one’s fellow citizens will inevitably lead to tyranny by some Central Authority. Therefore, this demand is unethical.

Method One also holds that, by returning to the individual the responsibility of paying for healthcare, we would be achieving a great good – namely, we would be returning healthcare back into the realm of actual market forces. When that happens, the laws of supply and demand will kick in once more, and will determine which services are actually needed, and what the rightful price for those services ought to be.

So from a practical standpoint, Method One will truly recruit the efficiencies of the marketplace into the workings of the healthcare system. (In contrast, placing dictatorial powers into the hands of insurance executives, which is what the HMO movement of the 1990s actually did, accomplished no such thing.) And the cost of healthcare services will at last come back down to a level which individuals can actually afford. As an added bonus, since everyone will know that paying for future illnesses will be their problem, people will suddenly become more likely to begin making lifestyle choices that will lower their odds of having to do so.

But whether or not individuals can afford medical services, at least the spending on those services will no longer be the burden of society – and the fiscal doom we now face will be cured.

Opponents of Method One point out that, inevitably, there will be individuals – and likely many, many individuals – who simply will not be able to afford to pay for healthcare services which are needed, and which are readily available for the right price, and will therefore suffer preventable pain, disability, and death. Without some kind of public support for healthcare, heart-rending tragedies will abound, our civilization will become coarsened, anger will build, and insurrection will become a constant threat. Such a result, of course, would be suboptimal.

Method Two: Make All Healthcare Spending The Responsibility Of A Central Authority.

Proponents of Method Two hold (because of ethical reasoning that is as obvious to them as the opposite ethical reasoning is to proponents of Method One), that healthcare is a fundamental right; that whether one receives a healthcare service – a service that can relieve pain or prevent disability or death – ought not to depend on one’s ability to pay, but instead, that such services, so fundamental to human life, ought to be equally available to everyone. And the only way to achieve this goal is to collectivize and centralize healthcare decisions and healthcare spending.

This is what I have called the Progressive plan.

For proponents of Method Two, healthcare services are indeed fundamentally different from all other human needs – food, clothing, etc. – since the kind and the amount of healthcare services one needs are most often not a matter of individual choice, but are very often foisted upon one by fate. Burdening individuals with the need to pay for such arbitrary and uncontrollable costs is not only unethical, but destabilizing to our society.

Requiring individuals to pay for their own healthcare is destabilizing because, if a person’s lifetime of work and saving can be wiped out in an instant by an unexpected illness, people will be much less willing to work hard, take risks, and otherwise engage in the economic activities that drive our society. “Healthcare security,” which can only be provided by collective efforts, is thus necessary to a robust and sustainable civilization.

The methods by which healthcare costs can be controlled under a centralized system are straightforward. Obamacare, for instance, does so by explicitly empowering a (nearly) all-powerful Independent Payment Advisory Board with all macro-level healthcare spending decisions. Furthermore, “guidelines” promulgated by various other government-approved expert panels will control spending at a more granular level, by determining which specific services doctors will be permitted to offer to which patients, and under what circumstances. Doctors will be strictly held, under the threat of criminal prosecution, to these guidelines. Finally, recognizing implicitly that many healthcare needs are indeed determined by individual lifestyle choices rather than purely by chance, public health experts will advance enforceable policies that will determine what individual Americans will be permitted to do and not do, purchase or not purchase, eat or not eat. (The public health experts are off to a very good start in this effort!) If everyone within the healthcare system (and in our society) will simply follow the multitudinous directives laid out by the legions of sanctified experts, everybody will have their healthcare, costs will at last be contained, and all will be well.

Proponents of Method Two obviously do not sell their plan to the public by saying such things. Rather, the emphasize that the benevolent, caring, non-conflicted, government-approved experts will make sure that all the inefficiency and greed are squeezed out of the system, and that by doing so, everyone will get what they need, and costs will be controlled.

I will spend Part II of this book showing why Method Two is a bad choice. Here I will only state the bottom line: Implementing Method Two requires an all-powerful Central Authority, which will inevitably lead to tyranny (or anarchy), and will necessarily destroy the Great American Experiment.

Method Three: Provide Strictly Limited Public Support For Some Healthcare Services, With Individuals Responsible For The Remainder.

Method Three attempts to combine the benefits of Methods One and Two, while avoiding the major disadvantages of each.

Method Three recognizes that paying for all of one’s own healthcare is beyond the means of many individuals, and that therefore a modern, civil society ought to provide at least some healthcare to at least some of its citizens. At the same time, Method Three recognizes that the public funding of all healthcare is beyond the means of society, leads to tyranny, and that (both for these practical reasons and for ethical reasons) individuals ought to be responsible for paying for as much of their own healthcare as they can, within reasonable limits.

The key to controlling costs is that the dollars which society will spend on healthcare for individuals must be strictly defined and strictly limited, and cannot be open-ended. Economic principles dictate that public healthcare spending must be limited to pay-as-you-go, and cannot accumulate inter-generational debt. Any other healthcare expenditures beyond those which society is able to provide in an economically responsible way must be paid for by individuals. Therefore, most individuals should not and cannot rely entirely on public funding for their healthcare.

At the same time, Method Three seeks to assure that individuals will have ready access to, and the means to pay for, basic healthcare services, and that the chances of being financially ruined by a catastrophic illness are very low.

Numerous configurations are possible under Method Three, and indeed, the creativity it allows (in distinction to Methods One and Two) is one of its attractions. Possible configurations might include something like the plan Congressman Ryan proposed in 2011, which would place a strict limit on Medicare expenditures by providing seniors with a fixed amount of money – on a means-tested sliding scale – with which to purchase their health insurance of choice.

But a more radical (and I humbly submit) a more complete Method Three configuration would be that which I proposed in my 2007 book, Fixing American Healthcare. That book describes my plan at great length, but in outline here it is:

 

My model calls for a 3-tiered healthcare plan. (See the figure.)

Tier 1 consists of a modified Health Savings Account. Each individual has his or her own HSA, into which they can deposit some amount of money each year (say, $2000) tax-free. For people in lower income levels, HSAs will be funded by the government on a sliding scale. Funds in the HSA can also grow tax-free, are the property of the individual, and cannot be taken away. Unspent funds that have accumulated above $10,000 can be transferred to an IRA at age 70.

The HSA is there for a very specific purpose: All individuals are responsible for paying for all their own healthcare expenses, up to $2000 per year. The HSA is aimed at providing funds for these annual personal expenditures.

Tier 2 is a Universal Basic Health Plan (UBHP), which will cover every person who resides in the United States legally. The UBHP kicks in after the individual has maxed out his or her $2000 annual personal healthcare expenditures. The UBHP I described in my book would operate under a system of completely open, completely transparent healthcare rationing. That is, it would cover all healthcare services that achieve a target level of cost-effectiveness, and would not cover anything else. The methodologies used to determined what is covered and what is not must be objective, measurable, and fully transparent to the public. My book describes such a rationing methodology in great detail*. However, the kind of open rationing system I described in my book is admittedly very complex, would likely be difficult to operate, and would certainly be difficult to explain to the public. There are simpler ways to administer Tier 2, and these simpler ways should be entertained.

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*My earlier book employed a novel method of calculating Quality Adjusted Life Year (QALY) values for various medical services, in order to rank the cost-effectiveness of those services. That section of my book was extremely boring and tedious and full of math, and I am led to understand that several individuals who actually tried reading that section died in situ. I am only mentioning it here because the term QALY shows up in the figure. For the purpose of the present discussion you can think of the QALY values in this figure as indicating “some defined amount of money that can be spent on your healthcare.”

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The key point, however, is that the UBHP must indicate, very openly and plainly and for everyone to see, which medical services are covered, and which are not. It will not pretend to cover all beneficial healthcare services, or that uncovered services are necessarily worthless. It is a basic health plan, and not a comprehensive one. Its mission will be to cover all the proven healthcare services it can afford to cover without unreasonably jeopardizing the security of future generations of Americans.

Tier 3 is optional for individual Americans. It consists of insurance products which will be designed to cover healthcare services that a person wants or needs, but which are not covered (for whatever reason) under the UBHP. Accumulated funds in HSAs may be used to help pay premiums for Tier 3 coverage. Among other things, Tier 3 insurance products would resurrect our moribund health insurance industry. It would give them the opportunity to develop an array of products that do what insurance is actually supposed to do – to provide financial protection against the unlikely chance of something prohibitively expensive occurring.

If you don’t like my plan, that’s fine. I’m merely offering it as an example of the kinds of schemes that are possible under Method Three. The main points I want to emphasize are: a) This plan strictly limits the amount of public funding that will be spent on healthcare (and therefore solves our healthcare fiscal crisis). b) At the same time, it provides for both basic and advanced healthcare for every American (The advanced healthcare is provided with limits, to be sure, but those limits are completely transparent, and can be mitigated by electing to participate in Tier 3.) c) Since everyone will be paying out of pocket (from their HSAs) for basic healthcare services, those basic services will become subject to normal market forces for the first time in a half-century, and as a result their cost will inevitably drop.

How Will We Choose?

At this moment it appears that we have chosen Method Two. This is perfectly understandable. Progressives, in promoting their solution, have been able to make it seem far more desirable to the average American than have any proponents of Methods One or Three. Their message is: We will make sure that fair-minded, dedicated government agents (who care nothing for the evil of profits) will squeeze all the waste and inefficiency out of the system, and distribute just the right amount of healthcare at just the right time, and everyone will get exactly what they need. Even better, the rich people (i.e., the profit mongers) will bear most of the freight by paying high taxes.

That’s a far more pleasant message than the ones that have been tried by those who favor Method One or Three, both of which require different – but significant – degrees of personal responsibility on the part of every American. Therefore, these other two methods, on the surface at least, sound a lot riskier, more difficult, and a lot more complicated than the easy, Let-Uncle-Sam-Do-It Method Two. In fact, given the way these choices have been sold to the public, it’s hard to imagine we would choose anything except Method Two at this critical juncture.

Still, one can always hold out hope that we might reconsider. The main point of this book is to induce such a reconsideration by showing what Method Two will really be like for all of us.

And, if we do reconsider, I suppose it is obvious by now that I am partial to Method Three.

Method One is simply a non-starter. For all practical purposes, and for good or for bad, we moved irreversibly beyond a purely self-pay healthcare system over 60 years ago. So if there is to ba a real battle, it will be between Method Two and Method Three.

The key difference between these two methods, both practically and philosophically, is whether individuals are to be expected – indeed, whether they are to be permitted – to pay for at least some of their own healthcare with their own money. Progressives, for reasons I will describe later, are absolutely adamant about the answer to this question – by no means will individuals be expected (or permitted) to pay for any of their own healthcare. It is absolutely imperative, if we are to achieve the perfect healthcare system that Method Two promises, that all healthcare decisions and all healthcare spending be centralized. There can be no compromise on this.

Indeed, the moment a compromise is made, true Progressives understand, we will inevitably wind up under a Method Three healthcare system. So Progressives are in no mood to compromise.

I will be delving into this crucial question – whether some amount of personal responsibility should be expected, or even allowed – later on in some detail, as I believe it is the most pivotal as-yet-unaswered question we will have to face going forward. For, while we have ostensibly chosen Obamacare, we have not all agreed on what that ultimately means for each of us. And once we do understand what it means, I believe we may be in the mood to reconsider our decision.

For now, I will simply make a simple assertion which I would like you to begin thinking about.

Here it is: If I am correct that Progressives will fight very hard – possibly to the death – to prevent individuals from spending their own money on healthcare, that fact carries with it an unavoidable implication. The only logical reason Progressives would fight so extremely hard to prevent such a thing is that their actual prime objective must be something other than merely fixing the healthcare system and controling healthcare expenditures. Rather, their actual prime objective must be to employ our healthcare system’s fiscal crisis as the most immediate and expeditious, and indeed the most ideal, vehicle for achieving their overall Program.

If you will allow even the remote possibility that this is the case, then we had better take a look at what the Progressive Program actually is. In the next chapter, that is what we will do.

Wait! What about Method Four?

Oh, yeah. I forgot to talk about Method Four.

There’s really very little reason to talk about the fourth and final method for controlling our healthcare expenditures. This is because nobody likes it. There are no proponents for it, so nobody discusses it.

Still, Method Four, at this moment, seems to be the most likely outcome for us. Indeed, at this moment it appears to be our default method of choice.

Method Four is formulated as follows: Our skyrocketing healthcare expenditures are the chief driver of our national debt. Our national debt burden, unless we get control of it by controlling healthcare expenditures, will inevitably destroy our civil society. At the same time, our modern, sophisticated and very expensive healthcare system utterly requires a complex, modern, highly organized, high-tech society in order to function.

Therefore, our skyrocketing healthcare expenditures ultimately provides its own cure. Once society collapses, “healthcare services” will revert back to the roots-and-poultices methodologies that served mankind so well for millions of years. Healthcare will ecome very cheap again. And healthcare, as well as other modern geegaws like cable TV, Internet, iPhones and automobiles, will no longer be considered by so many to be fundamental human rights, but will become a mere afterthought (if thought of at all), in a more primitive kind of society where life is nasty, brutish and short.

If we neglect to settle on any one of Methods One, Two or Three, or if we pick one and execute it poorly, we will, Chutes-and-Ladders-like, be deposited right back to Method Four where we all started.

Method Four is therefore only important in the way of helping us to keep things in perspective. For, whatever the outcome turns out to be, our current fiscal crisis in healthcare will ultimately be viewed by posterity, should any record of it remain for posterity, as a temporary matter of not much immediate concern.

This is Chapter 3 of my book-in-progress, “Open Wide And Say Moo! – The Good Citizen’s Guide to Right Thoughts And Right Actions Under Obamacare.” Comments are fervently sought; you can leave them here.

You can read my rationale for undertaking this project, and thus opening myself up to the possibility of public failure, humiliation, derision, disapprobation, and unwanted scrutiny, here.

And here is the up-to-date archive for all the chapters that have been posted so far.

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Chapter 3 – The Cowing of the Medical Profession

“Did you really think that we want those laws to be observed? We want them broken. You’d better get it straight that it’s not a bunch of boy scouts you’re up against . . . The only power any government has is the power to crack down on criminals. Well, when there aren’t enough criminals, one makes them. One declares so many things to be a crime that it becomes impossible for men to live without breaking laws. Who wants a nation of law-abiding citizens? What’s there in that for anyone? But just pass the kind of laws that can neither be observed nor enforced nor objectively interpreted and you create a nation of law-breakers.”

- Floyd Ferris, bureaucrat – Atlas Shrugged

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The doctor who tells his patient to open wide and say moo is, in fact, projecting.

For the once proud, once ethical medical profession has been officially broken and domesticated. This, of course, is incredibly sad for the profession.

But it is life-threatening for patients.

And while it began a long time ago, the gradual destruction of the medical profession became a headlong rush in the 1990s, and ended with a final, formal capitulation in 2002. To be sure, doctors did not go voluntarily, but were coerced – by both the avaricious insurance companies and the ruthless government – to sacrifice their professional autonomy for the sake of their personal comfort and safety. The coercion was intense, but still, their resistance was remarkably feeble. In the end they did not fight as they might have to protect either their profession or their patients’ welfare. When the time came they chose not to defend their professional integrity with their lives, their fortunes or their sacred honor.

It is a sorry tale, but it must be told.

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After the collapse of the Clinton healthcare reform plan in 1993, both the triumphant HMOs and the beaten-back government plotted their moves. For the insurers, the pathway seemed open and clear. For government policymakers, chastened as they were, the pathway forward seemed no less clear – but it would have to be negotiated in a somewhat less open manner than they had originally hoped.

When these two powerful entities sat down in their respective bunkers to figure out next steps, they each came to the same conclusion: At the end of the day, the key to controlling the healthcare system was to control the behavior of physicians.

This became apparent the moment the accounting experts from the HMOs and various government agencies studied the matter in order to determine where all their money was going. What they saw horrified them.

They saw, 1.5 million times per day, a single doctor sitting down with a single patient, and – just between the two of them – deciding which extraordinarily expensive healthcare resources they would like to consume for the possible benefit of that individual patient. And, once reaching a decision, the doctor then would calmly scribble something on a prescription pad, or write a line in a hospital chart, and instantaneously all the resources of the massive, mindless healthcare system would heave into action, bending to the doctor’s will. And, seeing all this, the HMO executives and the government policymakers, separately but with equal fervor, each sat up and cried, “My God! They’re spending MY money!”

Something had to be done to get these doctors – the engines of all healthcare spending – under control. The strategies the insurance industry and the government used to control the behavior of doctors were quite different from one another – but both were effective. And as a result of these efforts, as we enter the era of Obamacare, the Central Authority will find the medical profession to be quite compliant and docile to its needs. To be sure there will be a bit of whining from physicians, and expressions of dissatisfaction and similarly ineffectual complaints, but these are easily dealt with. Doctors will not pose any real obstacle to Obamacare. They have been fully domesticated.

What The HMOs Did

HMO executives, being businessmen, set out to control doctors the only way they knew how – by attacking them in their wallets. Promise them riches beyond belief (or at least the wherewithal to make a decent living) if their behavior pleases you, but make sure they know that destitution awaits if they should displease you.

It did not take long for these smart business experts to figure out that to control the physicians’ wallets, you need simply take control of the flow of their patients.

Doctors in the early 1990s were used to getting their patients by the hard work of establishing their professional reputation, and relying on referrals from appreciative colleagues and by word of mouth. When the HMOs suddenly moved in, before physicians ever realized what was happening, that model disappeared virtually overnight.

Under the HMOs, insurance products no longer covered patients for whichever doctor they chose to see. Instead, in exchange for reduced premiums, their health insurance covered them only if they received their care from doctors who had been admitted to the HMO’s “physician panel.” Doctors all over the land quickly learned that patients they had cared for, sacrificed for, and worried over for years, and who (they thought) regarded them as part of their family, dropped them like a hot potato the moment they had the opportunity to choose a health insurance plan which was marginally cheaper, but which did not include them on its panel of physicians.

And it quickly dawned on doctors that, if they were going to maintain themselves in anything like the style to which they had become accustomed, they needed to get on every panel of every HMO that served their area. It was the only way to allow all their patients to continue to have access to them.

But once doctors were “captive,” (i.e., completely dependent upon their position on HMO panels for their livelihood), the game was was all over except the shouting. Physicians were cooked virtually before they knew what had happened to them.

At first, the HMOs were happy to have all physicians on their panels. This is because at first, the HMOs’ major priority was signing up just as many patients as they could – so including as many doctors as possible on their physician panels was an important aspect of recruiting subscribers.

But once this initial sign-up phase was over, the HMO executives no longer had use for all those doctors on their panels. Some were expendable. They let their doctors know it by terminating a few of them from time to time, apparently arbitrarily and without explanation – leaving the surviving doctors to guess the reason for it.

But since doctors are generally pretty smart, they were good at guessing the heart’s desire of the HMO executives.

It should be obvious that HMO executives would be anxious to get rid of doctors who spent a lot of their money, and retain the ones who did not. To distinguish between the two, HMOs set up “performance standards.” These standards, following the usual fiction, were billed as “quality” measures, but in general they actually seemed aimed at determining how much money various doctors were spending. Often, something like 10% of the physician’s annual reimbursement was held back as a “withhold,” payable to the doctors only if they met the published performance standards. Doctors who failed to meet performance standards not only did not get the rest of the money they had earned, but worse, were in danger of being cut loose from the HMO’s panel altogether, thus jeopardizing their livelihood.

This system quickly got physicians into the right frame of mind, and focused them quite nicely on whose interests they actually needed to keep at the forefront when they were making clinical decisions for their patients. It also prepared them to put up with more of the HMOs’ new management techniques.

Once each quarter, some men in dark suits would come to visit. They were “practice consultants,” and they were there to help. The practice consultants would use data the HMO had accumulated to assist the doctor in re-titrating his or her decision-making processes, in order to guarantee they were practicing medicine to everyone’s best advantage.

For instance, the practice consultants might say, “Dr. Smith, we notice that the patients in your practice cost our HMO an average of $342 each last quarter. This is unfortunately higher than the target we set for you of $315. We are distressed to have to mention that this puts you in some jeopardy regarding your “withhold,” and possibly of further action as well. But we are here to help. Let’s see how we can do that. Ah! Here’s something. Notice that you sent four patients last quarter to Cardiologist Jones, and Cardiologist Jones spent an average of $4300 doing whatever it is he did to evaluate and treat those patients. And you sent three patients to Cardiologist Wilson. And she only spent $2100 per patient. That is quite a difference, isn’t it, Dr. Smith? Hmm. Well, Dr. Smith, you know we would never tell you how to practice medicine – you’re the doctor! – but we thought you might find this cost differential interesting, as you decide where to refer your next patient.”

And while Cardiologist Jones and Cardiologist Wilson have entirely different areas of expertise, which Dr. Smith had formerly taken into account when deciding where to refer his patients, his new-found wisdom now dictates that it might be best if Cardiologist Wilson would become his new go-to cardiologist for all cardiac-related problems his patients might have. And Cardiologist Jones, when he notices a marked decrease in his referrals during the following quarter (since the men in suits visited lots of primary care offices in the area), will probably never know that he (as well as many patients) has become the victim of trickle-down covert rationing.

Another common methodology to improve the quality of care, in a manner that would save the HMO money, was to institute Pay for Perfomance programs. P for P initiatives provided primary care doctors with a checklist of 10 or 12 items that they would need to accomplish during each patient visit, if they would like to be paid. The checklist consisted mainly of things that everyone would have to agree are useful – things like checking and discussing blood pressure and cholesterol levels, and reviewing their dietary and exercise habits, smoking habits, &c. There would be nothing on the list that anyone could possibly object to. However, the lists were so constructed that it was impossible to complete them in less than 10 minutes or so. And that, too, would have been fine, except that in order to meet the patient load the HMOs required, doctors needed to see a patient every 12.5 minutes. And here you can begin to see the true brilliance of P for P.

P for P saw to it that the routine health maintenance stuff got done each and every visit. But P for P also saw to it that there would be little or no time for “ad libbing,” that is, for the patient to bring up new, potentially-expensive medical issues, or, if the patient managed to blurt something out, for the doctor to adequately assess it. At best, the patient would have to reschedule another visit, for perhaps a month or two later. By that time the problem might be resolved, or might have run its course. Or perhaps something else might happen to make the new medical issue, well, moot.

Severely limiting the doctor’s face time with patients, then carefully scripting, down to the minute, what is to take place during that limited time, creates an opportunity for real cost savings. This is the kind of benefit you get when you apply modern management techniques to a trade whose processes really hadn’t changed much since the Middle Ages.

Through these and other creative applications of business principles, in a matter of a couple of years the HMOs owned doctors, lock, stock and barrel. And to make it official, in the middle years of the 1990s (once doctors realized that being retained on HMO physician panels was a matter of life or death), HMO executives invented the “gag clause,” which they added to the doctors’ contracts when it came time for renewal. Gag clauses said something like this:

“The physician agrees not to take any action or make any communication or representation to patients or patients’ families, potential patients or potential patients’ families, employers, unions, the media, or the public that would tend to undermine, disparage, or otherwise criticize the healthcare coverage provided by [insert name of HMO here]. The physician further agrees to keep all proprietary information such as payment rates, reimbursement procedures, utilization-review procedures, or other processes and procedures related to billing, collection, or review, strictly confidential.”

Agreeing to keep such potentially vital information from their patients – information which might materially affect a patient’s decisions regarding his or her own healthcare – was of course a direct violation of medical ethics. Medical ethics, however, had long since gone by the boards. The moment they had acceded to “performance standards” that enticed them to withhold medical services – and also acceded to sundry other coercions which HMOs had dreamt up to make sure physicians answered to their needs instead of their patients’ – doctors had already become deeply complicit in bedside healthcare rationing, essentially, rationing by omission. The gag clauses just put it in writing. So, apparently believing they had no good options, and already having lost the professional integrity which they ought to have held dear, doctors signed contracts by the thousands with gag clauses in them.

After a few years the gag clauses were noticed by “patient advocates” and other species of troublemakers, and strong objections were raised to them. The objections were based on the notion that it’s not nice for HMOs to gag physicians from telling their patients things that they ought to know. So, gag clauses were finally removed from HMO contracts.

But the damage had been done; the essential point had been made. When HMOs had asked doctors for a declaration of fealty that superceded all pre-existing professional obligations, doctors gave it, and with barely a protest. Whether or not gag clauses continued to appear in the contracts was immaterial. Once a dog learns to heel you can get rid of the leash, and the dog still heals just fine.

What The Government Did

The defeat of the Clintons’ healthcare reform plan certainly set the government policymakers back. The Progressives’ plans for a government takeover of the healthcare system, all in one grand campaign, had been foiled. But Progressives always take the long view, and they were undismayed. They quickly regrouped, and began stealthily instituting as much of the defunct Clinton plan as they could, piece by piece, through various laws, budgets, executive fiats and riders on Congressional bills.

Like the health insurance companies, Progressives in the government also recognized that it was imperative for them to gain control of the behavior of doctors. Hillary probably had said it best: “The problem with our healthcare system is too many greedy doctors using too much expensive technology.” So the name of the game was controlling the greedy doctors, the decision-makers on the ground.

The methodology they employed to do so was fundamentally different from the methods used by HMOs. HMOs naturally concentrated on controlling physicians by the power of economics, through simple threats to their livelihood. But as Ayn Rand taught us so many years ago, the power of the government over its citizens derives from regulatory (ultimately, prosecutorial) intimidation.

There is no need for the government to go all Robespierre, however. Actual bloodshed can be minimized. The Feds can usually get the effect they need by sending in the regulators – always backed by the threat of legal violence, of course – to harass a few people, ideally for what appear to be entirely arbitrary reasons. This action always proves wonderfully intimidating to the rest, and is an effective way to focus people’s attention on that which you would like them to focus.

I will be devoting much of the rest of this book to the abuse of government power with regard to healthcare, and don’t want to get too distracted by that topic here. So I will simply describe a single foray the government made in the time frame we’re talking about – the late 1990s – aimed at teaching doctors what is expected of them, and letting them know who they really work for. By doing so, I hope to make a bit more understandable why the medical profession made a complete and disastrous capitulation in 2002.

The E&M Guidelines

During the second Clinton administration, a new set of tortuous documentation requirements were imposed on American physicians by our government. The E&M guidelines, for “evaluation and management,” apply to the documentation that physicians are obligated to provide in support of their Medicare billing. The E&M guidelines, first instituted in 1995 and revised in 1997, were part of the Clintons’ great healthcare fraud reduction initiative. Ostensibly, the new, very strict documentation requirements would reduce the opportunity for fraudulent billing.

However, the E&M guidelines were, from the very beginning, a Regulatory Speed Trap of the first order. Regulatory Speed Traps work like this:

1) Over a long period of time, regulators will promulgate a confusing array of disparate, vague, poorly worded, obscure and mutually incompatible rules, regulations and guidelines.
2) Individuals or companies which need to provide their products or services despite such hard-to-interpret regulations, will necessarily render their own interpretations (usually with the assistance of attorneys, consultants, and the regulators themselves), and will act according to those interpretations.
3) By their apparent concurrence with, or at least by their failure to object to, such interpretations of the rules, the regulators over time allow de facto standards of behavior to become established.
4) When it becomes to their advantage, the regulators will reinterpret the ambiguous regulations in such a way that the formerly tolerated de facto standards suddenly become grievous violations.
5) Regulators aggressively, but selectively and arbitrarily, prosecute newly felonious providers of those products or services.

The E&M guidelines are so convoluted as to be unworkable in any objective way. Through their utter opacity and complexity, only partially reflected by the 48 pages of dense prose that comprise them, the E&M rules (for “rules” is what they are) in fact greatly magnify the doctor’s opportunity for making inadvertent documentation errors, and thus of producing a “fraudulent” bill.

Under the E&M rules, writing what used to be a simple progress note in a patient’s chart requires the physician to assemble a complicated set of “elements” from Column A and Column B, as from a Chinese menu, for each of four subject areas of the patient “encounter” – the history, the physical exam, the assessment, and the plan. Then somehow, one must translate the result (which reads like – and often is – a computer-generated form letter) into a billing code.

Despite the morass of confusion caused by the E&M guidelines, any failure to follow them to the complete satisfaction of the Central Authority is a priori evidence of Medicare fraud or abuse. And therefore, the E&M guidelines assure that with each and every patient encounter, the thing that will be foremost in the physician’s mind is not the needs of the patient, but how to fill out the complex documentation in such a way as to avoid the appearance of committing a crime.

In practical terms, this means filling out the documentation so as to blend in with the masses, so that one’s records will be passed over by the sharp eyes of the greedy forensic accountants (who are paid by commission for detecting instances of substandard documentation, now construed as “fraud or abuse”), or even worse, by the sophisticated software now being deployed to detect ever-more nuanced gradations of “outliers.”

The bottom line is that virtually any doctor who uses the E&M guidelines, and virtually all doctors do, are always guilty of healthcare fraud. It’s just a matter of who gets investigated.

Even if this documentation mess resulted in a straightforward means of determining proper billing codes (which it does not), it results in a medical progress note that is virtually undecipherable. This means that when another doctor (or even the same doctor on a different day) tries to read the progress notes to figure out what’s been going on with the patient (which used to be the point of medical progress notes, before they became primarily a vehicle for auditors), they cannot. Compliance with the E&M guidelines often actively confounds patient care.

The E&M guidelines were recognized immediately by doctors as a complete abomination. Indeed, the great hue and cry from angry physicians caused the Secretary of HHS to appoint a special commission to review the E&M guidelines in 2001. The special commission reviewed the evidence and concluded that indeed, the E&M guidelines were entirely counterproductive to patient care. In June, 2002 the commission voted (20-1) to recommend abandoning them altogether.

But HHS declined to follow the recommendations of its own commission, instead leaving the E&M guidelines in place “temporarily,” and vaguely promising to revise them “soon” in order to make them less dangerous to patient care – knowing full well that the saurian lassitude of the bureaucracy would easily outlast the fleeting indignation of the medical community. And, as the bureaucrats predicted, there has not been any substantial noise from doctors about revising these guidelines for several years now. A whole new generation of doctors has been weaned on them, and does not know any better. The E&M guidelines have become as permanent as the IRS.

(This simple example ought to teach us how difficult it will be to roll-back any of our new healthcare reforms in the future, even ones that are officially deemed to be harmful.)

Not only has HHS failed to take (or, alternately, succeeded in not taking) the steps it promised to take to revise the E&M guidelines, they also have vigorously pressed forward with audits and prosecutions for the federal crime of healthcare fraud, based on physicians’ inadequate compliance with them.

In a well-publicized test case, instituted by the government shortly after the E&M guidelines were first implemented – apparently to let doctors know they were deadly serious about this – criminal charges were brought against a Montana family doctor, alleging medical coding violations. But the government’s own expert concluded that the prosecutors were holding the doctor to standards that were not yet in force at the time the bills were submitted, and that the government was applying its new rules retroactively. The expert was so disturbed by his findings that he even offered to switch sides and testify for the defendant. Unfazed, the government simply switched tactics, dropping criminal charges and instead initiating a civil suit against the doctor for $37 million – which is way more money than the average family doctor has on hand. The defendant, breaking from the usual pattern, fought the government instead of settling. And after a long, long time, she was finally cleared – but not before she had spent over $300,000 out-of-pocket in legal fees.* Nonetheless the Feds had made their point to the physician community, loud and clear: We intend to vigorously prosecute physicians for violation of these guidelines, whatever you may think of them, and whether we’re acting fairly or unfairly.

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*Paul Rosenzweig, Senior Legal Research Fellow, The Heritage Foundation, testimony on “Sentencing and Enforcement of White Collar Crimes,” Subcommittee on Crime and Drugs, Committee on the Judiciary, U.S. Senate, June 19, 2002, p. 9.
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Every doctor in America suddenly realized just how serious the Feds were about enforcing these ridiculous, clinically counterproductive coding guidelines.

Frightened by the prospect of prosecution for Medicare fraud, many doctors adopted the tact of systematically “downcoding” their Medicare bills, figuring that they are unlikely to be brought up on fraud charges for underbilling. And normally one might think that the Feds would consider this a victory, since it would result in their keeping money they should be paying out. But the Feds’ purpose here was only secondarily to save money. Their primary purpose was intimidation – showing those doctors who’s the boss. So Medicare let doctors know that systematic downcoding may also be considered a fraudulent act, since it shows contempt for the law, and doctors suspected of doing so will be audited.

Because of the clear and present danger the E&M guidelines pose to every doctor, a multi-million dollar industry has sprung up to help physicians better comply with these coding guidelines. Physicians across the country are spending the time and money allotted for their continuing medical education learning to become better accountants, rather than better physicians.

Which brings me to a very interesting point about the E&M guidelines: It is not actually possible to follow the E&M guidelines accurately.

It turns out that coding correctly is impossible. This was proven in a formal study conducted a few years after these guidelines were instituted. A group of government-sanctioned coders took a sample of typical doctor-patient visits, coded them according to the E&M guidelines – and they all got different answers. If government-approved coders, using the government’s own guidelines, cannot figure out how to arrive at what prosecutors will always insist is the singular correct answer, then what hope do mere doctors have? (The results of this study were published in the Annals of Emergency Medicine in September, 2002.)

Obviously, then, since there is no “right” way to comply with the coding rules, all a doctor needs in order to become guilty of abusive billing, if not outright fraud, is for the fickle finger of the Feds to point his way, and initiate an audit. Violations are virtually guaranteed to be found during any audit. So what we’ve got here is a well-documented, openly acknowledged, published-in-peer-reviewed-literature Regulatory Speed Trap.

Here’s what happens to doctors who are suspected of committing coding abuse (which is to say, to any doctors who are visited by Federal auditors):

1) A small sample of their patients’ charts is audited.
2) The coding error rate (which is determined by the auditor) will be calculated for that sample, then that error rate is applied by extrapolation to every Medicare bill the doctor has submitted for the past 6 years (the statute of limitations).
3) For each violation in coding the doctor is estimated to have committed during those six years, the doctor must pay: a) triple the amount of restitution, plus b) $11,000.00 per coding violation.

It is not unusual for audited doctors to be hit with hundreds if not thousands of coding violations over a 6-year period, and the fines will almost always amount to well over 7 figures, if not 8. However, if it’s just abuse the doctor has allegedly committed and not fraud, often the Feds may offer a settlement deal in the low 7 figures.

And here’s what happens if the coding violations are judged by the auditor to be fraudulent (which involves the determination of intent, and therefore, unfortunately, often appears a somewhat arbitrary designation):

1) All the above.
2) Jail

And, as we have seen, if you somehow escape being convicted on criminal charges, the government still has the prerogative to come back at you with civil charges, where the burden of proof is lower.

Any doctor who has come anywhere near such a process wishes fervently for the good old days, when it was only the HMOs making your life miserable. Yes, HMO executives can be nasty sons of guns. But they can only decide not to pay you what you are owed, or perhaps throw you off a panel. They cannot decide to wipe out your life savings, take your professional license, or put you in jail.

The Feds know that the E&M guidelines are harmful to patient care. Their own commission came to that very conclusion in 2002. The Feds know that failing to comply perfectly with the E&M guidelines in each and every case does not really indicate fraud and/or abuse, but is the necessary outcome when you institute a complex set of rules that not even the government’s own approved coders can interpret.

That the Feds continue to impose the E&M guidelines on physicians, despite the harm that they know this causes, tells us something very important about their underlying motives. When you are in the business of covertly rationing healthcare, controlling the behavior of physicians – getting them under your thrall – is Job One. And as George Orwell observed for us, when you want to control the behavior of some people, a critical step is to control the mode, the rules, and even the very language of communication.

That physicians continue to comply with such oppressions, despite the harm they know this causes, and (with notable exceptions) without serious complaint, tells us something important about them, too.

What The Doctors Did

Despite the intense, unrelenting attacks against them by the health insurers and the government, it remains striking how completely physicians capitulated to the pressure and abandoned their professional responsibilities, and how quickly they did it. And in doing so, physicians threw away two thousand years of tradition, jurisprudence and ethics.

Medicine was one of the three original professions, the other two being the clergy and attorneys. Today, anyone working in any area of endeavor, as long as they have sufficient expertise that that somebody is willing to pay them to do it, calls themselves a professional. So we have professional hairdressers, chefs, sanitation workers, hit-men, and athletes. And by this definition, I suppose doctors can still call themselves by that name as well.

But by the original definition of the word, they gave up that privilege in 2002.

Originally, the term “professional” was defined not merely by somebody’s knowledge or expertise, but rather, by the special quality of the fiduciary relationship they had with their clients – a relationship marked by an absolute duty to place the needs of the client ahead of the professional’s own personal interests, or the interests of any third party.

In the case of physicians, this relationship is called the doctor-patient relationship.

To really understand what the doctor-patient relationship is supposed to be like, it is quite sad that today it might be necessary to have a look at a different profession, one whose members are often despised by physicians, but one that has managed to hang on to its professional integrity to this day – namely, the lawyers.

Say you are arrested for robbing a bank. Say the arrest was not unexpected, since you actually did rob a bank. Say that while you didn’t actually mean to do it, you shot a teller in the process, and the teller subsequently died. And finally, say you were caught red-handed.

Given this series of unfortunate circumstances, what rights can you expect?

It turns out that under the law, you have many rights. Despite the overwhelming evidence against you (the surveillance tapes, the eyewitnesses, the being-caught-at-the-scene-with-the-smoking-gun-in-your-hand, &c.), you have the right to a fair trial; you have a right to be considered innocent until a jury of your peers declares you guilty; and you will have the right of appeal (assuming you won’t like the verdict). But more importantly than anything else, you have a right to counsel, to an advocate, a knowledgeable professional who is obligated to defend you to the limits of her abilities, and to fully protect all of your interests under the law.

Society recognizes that the legal system is a morass of rules and regulations that ordinary citizens cannot hope to navigate on their own. Society acknowledges the need for any citizen caught up in the complex legal system to have a personal advocate who will hold that citizen’s interests above all others. Even when the accused party is as obviously guilty and as deserving of punishment as you obviously are, most of us would shudder to think of the abuses that would occur if people (even the likes of you) had to face a hostile legal system without the guidance of their personal attorney.

When you are sick, you are no more capable of navigating the complex healthcare system than is the accused felon of navigating the complex legal system, and you are no less in peril if you run afoul of that system. And your need of a personal advocate, a professional whose job is to protect your interests against the conflicting aims of a hostile healthcare system, is no less acute.

When you are sick, you should be entitled to at least the same protections as when you rob a bank. And this is what the doctor-patient relationship is actually for.

In recent years the “doctor-patient relationship” has been taken in hand by certain “experts,” who (in the way of teaching doctors to work more “effectively”), have reduced the whole thing to a series of tricks from the interpersonal-relationship trade. These may include looking your patients in the eye; displaying sympathetic expressions (practicing with the use of mirrors may be necessary); nodding as they speak (with all the sincerity of a Dr. Welby bobble-head); freely showing them your emotions (even if you have to manufacture them); remembering their birthdays and childrens’ names (yet another benefit of computerized medical records), and similar strategies for convincing patients that they have your full attention, and that nothing can be more important to you at this moment than their welfare. Such techniques are designed to get your patient’s thinking to the right place – which is to say, to get them to understand without too much fuss or muss why the efficient course of evaluation and treatment you have selected for them (with the kind assistance of various government expert panels) is the correct one.

I think it’s the same training they give annuity salespersons.

Obviously, none of that has anything to do with the real doctor-patient relationship. The real doctor-patient relationship is a sacred covenant, one which is formed when a patient goes to a doctor for help, and the doctor agrees to give that help. Under that covenant, the patient agrees to take the physician into his confidence, and to reveal to her even the most secret and intimate information related to his health. The physician, in turn, agrees to honor that trust, and to become the patient’s advocate in all matters related to his health, placing his personal best interest above all other considerations. This strong relationship of mutual trust is what patients have always expected, what most doctors have striven for, and what everyone else (medical ethicists, professional societies, and those who enforce the law of the land) have traditionally agreed – and even demanded – must be the standard.

And for over 2000 years, the precepts of medical ethics were aimed squarely at guaranteeing the integrity of that relationship. Fundamentally, these ethical precepts held physicians to the high standards of behavior embodied in the classic doctor-patient relationship, and further, gained physicians admittance to the small society of “professionals.”

Unfortunately, by the late 1990s, perceptive physicians noticed a big problem. Namely, thanks to the various perfidies being visited upon them by HMOs and the government, doctors could no longer act in accordance with their fundamental ethical precepts. They were being pressured to place the vital interests of the insurers and the government ahead of the vital interests of their patients. They were coerced into violating their sacred duties under the doctor-patient relationship. And, as we have seen, doctors gave in to that pressure.

Soon, influential thought leaders in medicine and medical ethics expressed alarm at what was going on. Clearly, they said, something needed to be done about it. And they decided to act.

But the action which the medical thought leaders finally took was not to fight back against the pressures being placed on physicians to violate their most fundamental ethical principles. Instead, the medical thought leaders launched an effort to change the precepts of medical ethics, to make medical ethics comport with the actual behaviors which modern doctors were being coerced to adopt.

Changing millenia-old ethical precepts proved to be surprisingly easy. This is because it is surprisingly easy today to find respected ethicists who will sanction just about any nefarious activity you can think of, as long as that activity furthers some higher cause which is to their liking. These ethicists are called utilitarians.

The solution to the physicians’ ethical dilemma was initially proposed as early as 1998, in an article by Hall and Berenson in the Annals of Internal Medicine (volume 128, p 395) which stated: “It is untenable for the medical profession to continue asserting an idealistic ethic that is contradicted so openly in clinical practice. . .We propose that devotion to the best medical interests of each individual patient be replaced with an ethic of devotion to the best medical interests of the group. . .”

This influential article, among other things, led to the formation of a commission to formally study the issue (the issue, again, being that if it becomes difficult to follow ethical precepts, then one ought to go ahead and change them).

This effort was led by the American College of Physicians, the main professional organization of experts in internal medicine, and this organization was quickly joined by virtually every other major physician organization in the world. Physician-leaders completed their ethical overhaul of the medical profession impressively quickly, and published it in 2002. They called it “Medical Professionalism in the New Millennium: A Physician Charter. “(Annals of Internal Medicine, February 5, 2002). With its publication a two-thousand-year tradtion of medical ethics was ended. It is the suicide note of the medical profession.

The innovation of the Millennialists was to proclaim a new ethical precept: the precept of Social Justice. The precept of Social Justice charges physicians with effecting “the fair distribution of healthcare resources.” That is, it renders it ethical for doctors to decide which patients ought to get those limited resources, and which ought not to get them; it specifically and directly justifies covert bedside rationing by physicians.

The reason this new ethical precept was deemed necessary is explicitly because doctors cannot any longer adhere to the old ones. (“It is untenable. . .to continue asserting an idealistic ethic,” according to Hall and Berenson. “Indeed, the medical profession must contend with complicated political, legal, and market forces,” according to the Millennialists themselves.

Ostensibly, the precept of Social Justice gives doctors who are too introspective (admittedly, not a big problem with many of us) an out when they find themselves having to place the interests of payers ahead of the interests of their patients by, say, failing to mention certain medical options that might be available. “Sure, I’m violating classic ethical principles,” they can now tell themselves, “but I’ve got to do that to honor this new one.”

The bottom line is that, having been coerced by the the insurers and the government (both of which control the doctors’ professional viability, and one of which also controls their status regarding incarceration vs freedom) to place the payers’ needs ahead of the needs of patients, doctors found themselves in utter violation of their fundamental ethical precepts. The proper response of physicians (and their professional organizations such as the ACP) would have been to reassert those ethical obligations, to push back against the payers, and enlist the cooperation of their patients (who, after all, have a particularly vital interest in the matter) in doing so. Instead, they have taken a path of lesser resistance, re-defining medical ethics to comport with their new, coerced behavior.

What Does This “New Ethics” Do To the Doctor-Patient Relationship?

The addition of the precept of Social Justice to the ethical obligations of the physician renders the classic doctor-patient relationship inoperative.

The New Ethics breaks the covenant from the outset. It renders “ethical” the divided loyalty of the physician. Today, when patients go to a doctor for medical advice, they do not know – and cannot know – whether that advice is being given to advance primarily the patient’s own well-being, or the well-being of the society that desires a “fair distribution of healthcare resources.”

With the formal adoption of this New Ethics, patients essentially have been cut loose, and set adrift to fend for themselves in an increasingly hostile healthcare system, without being able to rely on the kind of personal advocate they’ve been conditioned to expect, the same kind of advocate an accused murderer is still granted without question or hesitation. What’s worse, nobody has told patients that they have been abandoned in this way. They think their doctor is still working for them.

Less obvious, but no less profound, are the consequences this New Ethics has on the profession of medicine. Abandoning their primary obligation to the individual patient means that physicians have committed the “original sin.” They have abdicated their traditional, ethical, and legal roles as patient advocates; they have broken a sacred pact. They have fully compromised themselves as professionals; indeed they have become professionals in name only, and not in fact. And as a result, to their utter frustration, they find themselves standing naked before their enemies, the very insurers and regulators who forced them to abdicate their sacred obligation in the first place.

And it is in this utterly subservient position that we find our doctors – our protectors, our advocates – when Obamacare comes to town.

This is Chapter 2 of my book-in-progress, “Open Wide And Say Moo! – The Good Citizen’s Guide to Right Thoughts And Right Actions Under Obamacare.” Comments are fervently sought; you can leave them here.

You can read my rationale for undertaking this project, and thus opening myself up to the possibility of public failure, humiliation, derision, disapprobation, and unwanted scrutiny, here.

And here is the up-to-date archive for all the chapters that have been posted so far.

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Chapter 2 – The Demise of the Health Insurance Industry

I fear that, in Chapter 1, I may have left you with the impression that our healthcare expenses have been piling up for the past 50 years, to the point where our entire culture is about to collapse under the weight, without anyone or any organization doing anything about it.

If so, I apologize, for nothing could be further from the truth. In fact, our healthcare expenses have been piling up for the past 50 years, to the point where our entire culture is about to collapse under the weight, in spite of the heroic efforts on the part of our health insurance companies, our doctors, and our government to stem those costs.

Indeed, their efforts have been little short of astounding. The health insurance industry has driven itself upon the shoals in a daring attempt to rescue our healthcare finances, and lies there today, foundering and needing rescue itself. Doctors have made what amounts to a suicide attack against the rising costs, essentially throwing away the very essence of their own profession in the attempt, and leaving for posterity a signed suicide note. And our government – well, our government of course has tremendous resources, and has spent or pledged the lifetime earnings of the next three or four generations of its citizens in what appears to be an entirely fruitless effort to bring healthcare costs under control. (Our leaders assure us they feel very badly about this, however.)

So it’s not for lack of trying. It’s that what they have all been trying – namely, covertly rationing our healthcare – not only does not and cannot work, but also intrisically makes things much, much worse.

This and the next chapter will demonstrate the sorry state to which such misguided efforts to control costs have reduced our healthcare system and its participants – and well before Obamacare ever came along.

A Bit On Covert Healthcare Rationing

I have been writing a blog for the past five years about the covert rationing of America’s healthcare, so there is plenty I could say about this. However, I will limit myself, with exquisite difficulty no doubt, to just saying what covert rationing is and why it’s a problem.

First, let’s be clear on the definition of healthcare rationing. To ration healthcare is to intentionally withhold at least some useful medical services from at least some of the people who would benefit from them.

To ration covertly is to do the above without admitting to it, and most often while indignantly denying it.

I will not go into an exhaustive argument here to “prove” we’re rationing our healthcare covertly, or that covert rationing intrisically wastes far more money than it can ever save. I have done that elsewhere. Instead, I will simply lay out a 3-point thesis which makes it intuitively obvious that covert rationing is what we’re doing, and that by doing it we’re compounding the underlying fiscal problem.

Point #1: Healthcare rationing is a fiscal imperative. Rationing is fundamentally unavoidable, and therefore, we are not avoiding it.

In any advanced society, where a centralized agency of one species or another creates a pool of money from which most of the society’s healthcare bills are to be paid, whether that pool of money is controlled by the government, or by private insurance companies, or by some combination of these, then even if that centralized agency is very large, very powerful, and very coercive, and even if that agency is able to borrow (say) trillions and trillions of dollars, there will always be limits on how much money can be placed into the pool. On the other hand, the amount of money that could conceivably be spent to purchase every bit of all the available, potentially useful healthcare for every individual in the population who might benefit from it is essentially limitless.

This limited supply, and limitless demand, means that somebody, somewhere, will not receive all the available healthcare that would be potentially useful to them. So rationing is occurring. Q.E.D.

Point #2: We’re Americans, and Americans don’t ration. So the unavoidable rationing must be, and is being, done covertly.

An endearing trait of Americans, endearing to us Americans at least, is our limitless optimism, our undying belief that anything good that we can imagine can, and will, and must actually be accomplished. This refusal to recognize limits is responsible for much of the creativity, inventiveness, and productivity that has come from our American culture. And it has led to much good in the world, resulting, for instance, in most of the remarkable advances in healthcare we’ve seen over the past half-century.

The American culture of no limits, however, can be carried to counterproductive extremes. And that is what has happened with regard to healthcare.

Our “no limits” attitude about healthcare is typically American. It goes like this:

In America we have, and will continue to have, the best healthcare in the world – the best doctors, the best hospitals, and the best technology. Since one cannot place a price on a human life, anything that can be done for a sick person must be done, as long as there is some small hope of even a tiny benefit. Every disease is potentially curable, and as a matter of policy we will strive to learn how to cure every disease that exists (and when we run out of diseases to cure, we’ll invent new ones). Indeed, death itself is merely a manifestation of insufficient technology.

In summary, where healthcare is concerned, there are, and can be, no limits.

We can see the problem right away. While we have inherent spending limitations that unavoidably require healthcare rationing, we find that there can be no limits, and therefore, no rationing. Indeed, there can be no discussion of rationing, except to bitterly condemn the very idea. Any political leader or policymaker who would seriously suggest the idea of healthcare rationing would run squarely into this deeply ingrained culture of no limits, and would immediately become toast.

So, these two basic imperatives shaping our healthcare system – the unavoidable need to ration that will always accompany publicly-funded healthcare, and the culture of no limits – are, in their essence, completely incompatible with one another. Given our deep-seated need to simultaneously cling to both of these incompatible imperatives, our only option is to do the unavoidable rationing in a way that allows us to deny that rationing is occurring; in a way that allows us to ration while declaring that there are no limits. We can ration secretly. We can ration deceptively. We can ration covertly.

And (QED) that is what we are doing.

Point #3: Covert healthcare rationing is inherently and extravagantly destructive, not only to patients and their doctors, and not only to the healthcare system, but also to our national budget, and to our basic American social contract.

While there are plenty of problems with the American healthcare system, the truly intractable ones are intractable largely because of our need to ration covertly. As long as the need to ration healthcare covertly exists, these problems will persist.

By its very nature covert healthcare rationing is a deeply ironic construction. The whole purpose of rationing is to reduce spending on healthcare, and to control costs. But covert rationing (ironically) always increases expenditures. If we could ration healthcare openly, then it is possible that we could arrange, or at least try to arrange, the rationing in such a way as to optimize the efficiency, effectiveness and equity within our healthcare system.

But rationing covertly fundamentally means rationing in whatever way you can get away with. So, in order to hide the rationing, it is imperative to obfuscate, misdirect, complicate, juke, jive, shimmy and shake and do whatever else you must to to convince everyone – often including yourself – that whatever it is you’re doing, it’s not rationing. That is, you’ve got to create an environment of complexity and opacity in which you can get away with it.

As a direct result of this simple truth, simplicity, transparency and efficiency are lethal to a system based on covert rationing, and thus, are systematically rooted out. Covert rationing absolutely requires opaque processes and procedures, superfluous complexity, bizarre incentives, Byzantine regulations which are arbitrarily enforced or ignored in various times and places, astoundingly wasteful transactions, and the diversion of healthcare dollars to a complex host of non-healthcare ends, such as commissions, study groups and panels, various czars of this and that, ever-expanding layers of government bureaucracies, and the establishment of other massive bureaucracies within the healthcare system whose purpose is to defend against or manipulate those aggressive government bureaucracies. Covert rationing, by its very nature, demands and creates waste within our healthcare system, and therefore costs us far more money than it can ever save us.

So, while the fiscal mess in which we find our healthcare system is destined to screw all of us, by attempting to fix it with covert rationing we’re converting a simple screwing into a gang rape.

It will be instructive to have a look at how this has all worked out.

A Recent History of American Healthcare (continued)

It did not take long after the institution of Medicare and Medicaid in 1965 for astute economists and politicians to realize that, perhaps, we had just stepped off a financial cliff.

Smart people became alarmed about healthcare spending as early as 1970, when we were spending a “mere” 7% of our GDP on healthcare (a little more than a third of the proportion we’re spending now). And indeed, in 1972 Richard Nixon, demonstrating in yet another way that not all Progressives are Democrats, planned to propose in his second term a universal healthcare system. (So perhaps if those Progressives who today are so desperate for one hadn’t made such a big deal about Watergate, they would have had their heart’s desire 40 years ago.)

After Nixon was deposed, Gerald Ford got distracted trying to “Whip Inflation Now;” Jimmy Carter busied himself actually whipping inflation to heights not seen since the Weimar Republic; Ronald Regan dedicated himself to spending the Soviet Union into oblivion; and George Bush 41 beat up Sadam Hussein and raised taxes while trying not to move his lips. You know, stuff happened.

And the next thing you know it was 1992 and healthcare spending had nearly doubled as a proportion of the GDP since the time of Nixon.

Subsequently, the Clintons took up healthcare reform as their signature issue. Bill turned the effort over to Hillary because (as he explained it) she was smarter than he was, but some say possibly also as a reward for her amazing loyalty in the face of, well, you know.

In any case, at the beginning of the Clintons’ effort to reform healthcare, they had the goodwill and support of most Americans, of doctors, the media, and most importantly, the American health insurance industry. Hillary appeared to start off well, making a successful appearance before Congress, and, with great fanfare, convening numerous expert panels and other groups to gather their ideas, suggestions, and recommendations on healthcare reform, as if she intended to take them into account. Optimism was high.

But Hillary is a true Progressive, and so she already knew how to reform healthcare. Having made a great show of democratizing the process, she then retreated behind closed doors with a few hand-selected advisors, and soon emerged with a 1300 page bill of her own devising – Hillarycare.

Many were horrified by what was in that bill, which in fact gave the government full control of our healthcare system. Not the least among the newly-horrified were executives of the health insurance industry, who to that moment had been major supporters. They realized that if any law passed that was remotely like Hillarycare, their industry would soon become infeasible if not illegal. And so, acting with the alacrity of people who are in imminent mortal danger, the insurers quickly introduced the American people to Harry and Louise, a typical middle class couple who were depicted, in print ads and on TV, discovering numerous appalling provisions of the Clinton plan.

The rest was history.

The collapse of the Clintons’ reform plan caused a sudden deflation in Americans’ expectations, but the fiscal crisis remained. In fact, the one thing the Hillarycare effort had indeed accomplished was to create a general awareness among the public that the healthcare system was in dire financial straits, and that business as usual was not an option. And nobody (except for the doctors, wallowing as usual in wishful thinking) believed things could simply go back to the way they were before.

Into the breach stepped the very health insurance industry that had just torpedoed Hillarycare. And they had a plan.

“Citizens!” they said, “We have just dodged a bullet. Thanks to us, the frightening socialist reforms of the Clintons have been soundly defeated. But where does this leave us? We stand now between Scylla and Charybdis, between the specter of nationalized healthcare on one hand, and continued, wasteful, traditional fee-for-service medicine on the other. And we cannot countenance either.

“But wait! Here is a third way, a painless way, based on the sound principles of managed care, open markets, and free enterprise. Let us in the health insurance industry, successful businessmen all, wielding the tools of efficiency and sound business practices, step in and save the day. We will apply our proven tools and methods of efficiency to American healthcare, through our new vehicle for medical excellence – our for-profit HMOs. And we will demonstrate to the world the wonders that modern, free-market management principles can bring to American healthcare.”

And not having any other viable choice that any of us could see, we Americans gave the go-ahead.

The Brief But Remarkable Era of For-Profit HMOs

By this time, HMOs had been around, here and there, for 20 years. They were inventions of pipe-smoking, elbow-patched academics and other well-meaning naifs, who envisioned user-friendly, non-profit organizations which, by inculcating their clientele to the benefits of good health habits, disease-prevention lifestyles, and regular check-ups would – you know – maintain the health of its members. Until the collapse of the Clinton health reforms, HMOs were widely regarded with some bemusement, as the typical sort of ineffectual but benign social engineering experiment you generally get from cloistered academics, or as an eccentric aunt puttering about the attic of the healthcare homestead.

The for-profit HMOs which the health insurance industry introduced to America after the fall of Hillarycare were a different species altogether. If you asked the CEO of one of the old-fashioned HMOs what the mission was, she would say something like, “Why, it’s to maintain the good health of our clients, of course.” Not so for the new-style HMOs. Their mission (quite explicitly, since this is the message they used to sell all of us on the idea of turning American healthcare over to them) was to apply the modern management techniques of American business to make American healthcare efficient at last. And how does one assure that such modern business techniques will be fully and enthusiastically applied? By doing what every business must do to be successful – by focusing like a laser beam on profitability.

So if you asked a 1990s, new-style HMO executive what was his mission, he would reply, “Why, it’s to take this wasteful, inefficient puppy and turn it around into a profit-generating machine. Of course, as a spin-off you will get more efficient healthcare and the like. But the mission – and indeed the measure of our success, the evidence that we’re making healthcare more efficient – is our profitability.”

And with the mantra, “Profits = Efficiency” emblazoned on their standards, and with “Deus Lo Volt!” on their lips, the new-style HMOs went forth in the crusade to save American healthcare.

However, just as the real Crusaders became distracted on their way to the Holy Land by the opportunity to sack and pillage Constatinople, so did the HMOs become distracted by an unprecedented opportunity to sack every city, town and village in the land. Because it was the prospect of profits which would at last make American healthcare efficient, HMO executives argued, it only made sense for all the non-profit hospitals in America to be turned over to them. This way, the HMOs could incorporate those old, creaky, inefficient institutions into their new, machine-like, ultra-efficient, healthcare paradigm. When the city fathers and state commissioners of America seemed interested, the CEO would add, “We’ll even pay you for them.”

During the next six or seven years, virtually every non-profit healthcare organization in America – hospitals that had been owned and operated for decades by cities, counties, states, or religious organizations – were acquired by for-profit institutions. The way these transfers worked was: a) the hospital’s board of trustees (many of whom later wound up with well-paying jobs with the acquiring HMO) would approve the transfer; b) the state insurance commissioner or state attorney general would determine the intrinsic value of the hospital; c) the HMO would reimburse the appropriate entity with the assessed amount of money, often by establishing a charitable foundation.

For reasons I cannot fathom, the state officials seemed congenitally unable to estimate, even within an order of magnitude or two, the true intrinsic value of the transferred asset. Only the hospital’s value as a charity was considered, and not its potential as a business. They failed to consider the market value of trademarks, name recognition, decades of community goodwill, provider contracts, or subscriber lists. There were no competitive bidding processes; no formal valuations. So the new HMOs acquired thousands of major, publicly-held community assets, all across America, for pennies on the dollar.

If state officials were inefficient in this process, the markets were not. And the HMOs found that each time they acquired a formerly non-profit institution, the market would immediately reward them with a nice boost in their market valuations. HMOs suddenly became hot investment vehicles, and investors jumped in with their dollars. HMO executives were very, very happy.

This asset-acquisition phase of the for-profit HMOs was largely responsible for the great financial success these organizations enjoyed in the 1990s. And the hugely important story of the massive transfer of public assets to private companies went largely unreported.

Once they had gobbled up all the public hospitals, the for-profit HMOs immediately entered into a prolonged period of negotiated mergers with one another, thus consolidating the industry into a few massive players. This interval also produced large boosts in their market valuations, and it sustained the facade of corporate success for a few more years.

And that pretty much covers the glory years of the modern HMO. For a decade or so these companies were extremely successful, and performed very nicely for their shareholders. But their success, such as it was, had relatively little to do with their ability to make American healthcare more efficient. Rather, like those holy warriors who fought in the Fourth Crusade, their profits came mainly from sacking Constantinople, the city of their supposed allies and co-religionists.

To be sure, HMOs did work as hard as they could at improving healthcare efficiency during this period of time. They did this mainly by instituting efficiencies of scale. When you are managing several hospitals, or several scores of hospitals, you can streamline and consolidate your processes and procedures in some very big ways – with more pointed negotiations with vendors, for instance, or by computerizing and standardizing billing and ordering, or limiting drug formularies. You can also conduct fancy efficiency studies to show that, really, you could probably get away with an 8:1 nursing ratio instead of a 4:1 ratio. (By “get away with,” apparently, the efficiency experts meant that while the “downside” of such cutbacks might be suspected or even perceived by people on the ground, it was unlikely that it could ever be accurately measured – or therefore, proven – by a few local troublemakers.)

So the efficiencies of mega-corporate bigness were broadly applied, and as a result, during the latter half of the 1990s we saw less healthcare inflation than during any 5-year period over the previous 30 years. But the thing about applying this kind of cost-cutting measure – the kind that is applied on a global basis to the whole system – is that it is a one-time event. That is, the savings are realized right away, and as a result you successfully establish a new and lower spending baseline. But because (as we saw in the last chapter) the rate of growth in healthcare spending is not caused by the inefficiencies you’ve just eliminated, the increase in healthcare spending will thereafter simply resume and continue apace (albeit from a lower baseline).

This is just what happened. By the turn of the century, healthcare inflation was headed back up into the double digits.

And so, if they had not realized it before, by the early 2000s it finally occurred to the HMO executives that, at long last, if they were going to remain profitable they were going to have to figure out how to cut healthcare costs by doing what they’d always told everyone they were so good at doing, but which they had never yet accomplished – actually managing the medical care of sick people.

This is when the panic began setting in.

Their panic was not inappropriate. For the HMOs had not been sitting on their hands when it came to making actual patient care less expensive. In fact, they had already tried everything they knew how to try – and it had not worked.

The business model of the HMO, simply put, is to gather the health insurance premiums from its subscribers, use that money to efficiently manage their healthcare, and keep whatever is left.

Therefore, to the HMO executive (the steely-eyed business executive we had all deputized to control our healthcare costs), the biggest risk to the business is: sick people.

Sick people are a huge problem. They are not subject to the usual “efficiencies” you can apply to most businesses. Simply streamlining business processes (admission and discharge procedures, consolidating laboratories, computerizing records and the like) does not work with sick people. You could implement these sorts of efficiencies all day long, and sick people will still be sick, and each one of them could blow through tens of thousands of your dollars each and every day.

Sick people, unlike the widgets which businesses typically process and manipulate to make their money, are not all alike. Each of them has a different constellation of medical problems, different needs, and different responses to testing and therapy. A medical service that makes Patient A recover in two days puts Patient B in the ICU for three weeks. Patients who recover enough to go home, but then stop taking their medications (or cannot afford to take them), or immediately resume an all-pizza-diet, will bounce right back in your hospital, and recommence consuming even more of your resources.

There can only be one answer to this problem. What you need to do is something you learned on your very first day of MBA school (where basically all you did was get your seat assignment, and eye-up the rest of the class to decide which ones you think you can work with and which ones you’ll need to sabotage in order to smooth out the curve). Namely, eliminate unnecessary expenditures. Which means: you need to avoid the sick.

Find ways to keep the sick (or potentially sick) from enrolling in your HMO. For sick people who manage to make it through the obstacle course you are going to set up for them, you will need to find ways to make things so unpleasant for them that they’ll go elsewhere. For the really sick who won’t (or more likely, can’t) leave, you’ll need to find ways to just toss them out.

And so, naturally, this is what HMOs did.

They made their best insurance products available to employers only, on the theory that people who have jobs are less likely to have serious, chronic illnesses or severe disabilities, or addictions. The inferior, “individual” insurance products (when HMOs could not avoid them altogether) were pre-loaded with onerous pre-existing condition clauses, so that only healthy young people were likely to be eligible. When HMOs held “open enrollment” drives for Medicare patients, they were invariably located on the second or third floor of buildings without elevators, often in affluent suburbs or at country clubs, and in any case in places that were at least two bus transfers away from “undesirable” neighborhoods. Such methods came to be known as “skimming” or cherry-picking, and were aimed at avoiding the sickest 10% of the population that accounts for 75% of all healthcare spending.

Sometimes, despite increasingly sophisticated cherrypicking techniques, a sick person would still get through the door. Or more likely, a formerly healthy subscriber, by virtue of a newly-acquired illness, would transform – werewolf-like -  into a voracious, healthcare-consuming monster. Techniques were developed for these, as well. In fact, the academic managed care literature (and yes, there is such a thing) paid particular attention to this issue – that is, how to frustrate undesirable patients sufficiently to entice them to go elsewhere. One interesting article titled “Demarketing of healthcare services,” appeared in the Journal of Healthcare Marketing in 1994. It said, among other things:

Decreasing accessibility to services . . . can be accomplished by “managing” the information distributed to patients regarding services available and how to access them. For example, an organization might excessively promote less-costly preventive procedures . . . and repress information about other elective and/or expensive services. In addition, providers can strategically locate and number specific services to make them easy (e.g., primary care) or difficult (e.g., specialists) to utilize. Furthermore, lag periods . . . also serve as containment strategies. Lags may be affected by the need for referrals, limited number of contracted specialists, restricted or inconvenient appointment availability, and increased office-visit waiting periods.

I would like you to notice a couple of things about this excerpt. First, of course, it nicely demonstrates that driving patients away was not an unintended consequence of HMO inefficiencies. The inefficiencies were manufactured specifically to achieve that end. But second, please observe that this is probably the most straightforward statement about covert healthcare rationing you’re ever likely to see from the people who are actually doing it. It graphically demonstrates that much of the inefficiency in our healthcare system is not accidental. It is carefully engineered for a very specific purpose. It is, in fact, an investment, aimed at improving the bottom line.

Here’s another example. In the late 1990s, the famous Jim Clark, the first Internet genius, the man who had founded both Silicon Graphics and Netscape, decided to launch a new venture which he called WebMD. While today WebMD is muddling along as a reasonably successful information portal, it was originally conceived by Clark as a powerhouse that would revolutionize healthcare in America. He wanted WebMd to become a platform for seamlessly interconnecting all the players in the healthcare system – doctors, patients and insurers – to improve communication, streamline transactions, reduce medical errors, and otherwise create efficiencies that would benefit American healthcare (and at the same time build shareholder value for WebMD). When he finally had built up the infrastructure for doing all this, at enormous cost, he went to the health insurers with his first can’t-miss proposition, the very can’t-miss proposition that had enticed his investors to put up the money for WebMd in the first place. Namely, he offered (in exchange for a tiny transaction fee) to process the HMOs’ medical claims for 70 cents per transaction (as compared to the $7.00 per transaction it currently cost them), and furthermore, to complete the transactions in a matter of minutes instead of a matter of months. Much to Clark’s amazement, there were no takers. None. And his dream died on the spot.

Astute readers will see the problem right away. HMOs, of course, have no interest whatsoever in streamlining their transactions. Quite the opposite. HMOs only make money if they do not have to pay out claims. And if they do have to pay claims, the longer they can hold on to the money before they actually pay it out, the longer they can keep it invested. And so, claims processing procedures have been carefully engineered into the most inefficient, Byzantine, and frustrating endeavors the devious human mind can conceive of. Unless a doctor’s practice hires a cadre of “claims specialists,” who spend all their time in an elaborate dance with the “claims specialists” employed by the HMOs, they would never collect any money at all. As it is, it is so expensive to chase smaller claims that many doctors simply don’t send in bills for them – which means the HMOs get to keep that money. Which means that doctors are reluctant to offer the medical services for which only a small bill is generated.

Are you starting to see how covert rationing works?

The End Game For HMOs

By the middle of the last decade, the health insurance industry realized it had run out its string. It saw no pathway forward to continued profitability.

The insurers had tried every sneaky and underhanded idea they could think of for reducing costs – cherry-picking the healthy patients, treating chronically ill patients like pariahs so they would go away, making access to specialty care as inconvenient as possible, forcing doctors to sign “gag clauses” to prevent them from telling their patients about certain treatment options (more on this shortly), browbeating primary care physicians into zombie-like compliance with handed-down care directives, refusing to cover expensive-but-effective medical services, and canceling the policies of tens of thousands of patients after they got sick, based on trumped-up technicalities. Indeed, they had tried everything short of dispatching teams of Ninjas in the dark of night to slaughter their most expensive subscribers in their beds. And still, their costs – essentially, the money they could not avoid spending on people who needed healthcare services – increased relentlessly.

All these efforts were to little avail. The cost of providing healthcare continued to skyrocket, entirely unabated. Finally, when all else failed, the insurers began instituting huge and unsustainable annual increases in premiums, to the point of driving their customers out of the market.

This latter move, of course, was an open acknowledgment that the industry had entered its death spiral. In fact, it was an SOS, a cry for help. It was the health insurance industry wailing, “No mas!”

The Health Insurance Industry And Obamacare

By 2009, when President Obama began his push for healthcare reform, the insurance companies knew they had no prospect of long-term profitability. Their business model was no longer viable, and, while telling soothing stories to avoid shareholder panic, they were urgently casting about for an exit strategy.

A drowning man will cling to any piece of flotsam that comes his way. What the insurance industry found floating by was Obamacare.

In return for its support in the healthcare reform battle, President Obama offered the insurance industry the graceful exit strategy it so desperately needed. Under Obamacare, for at least a few years the insurers hope to get One Last Windfall – namely, profits from the influx of previously-uninsured Americans whose premiums will be paid, or at least subsidized, by taxpayers. Here, the insurers are relying on the likelihood that the inflow of new premiums will, for a year or two at least, greatly outweigh the outflow of money they will have to spend caring for these new subscribers. Obviously, they will use every trick in their well-worn book to stave off expenditures for these new subscribers for as long as they can, but if they actually knew how to avoid paying healthcare costs indefinitely, they wouldn’t have sought a government bail-out. In any case, an inflow of new subscribers will be a very temporary source of profit for insurers. Hence, at best it is One Last Windfall.

What happens to the insurers after they exhaust this last windfall is still up in the air. Obamacare may, of course, eventually transition to a single-payer system, an outcome which many Conservatives desperately fear, and many Progressives fervently desire. Should this happen, there may very well be some final compensatory buy-out (or a buy-off) for the insurance companies – a truly-last windfall.

But more likely, the insurance companies under Obamacare will continue to exist essentially as public utilities. That is, they will exist as companies chartered by the government, which administer healthcare under the direction of the government, with the products they may offer, the prices they may charge, the profits they may keep, and the losses they may incur, determined solely by the government. It’s not glorious, but it’s a living.

And it’s a far better exit strategy than anything the insurance companies could devise for themselves.

So, when the time came, the insurance industry did whatever it needed to do to make sure President Obama’s reforms became law. Their assistance consisted of four simple steps:

1) Do not actively oppose Obamacare. In stark contrast to its behavior during the Clintons’ effort to reform healthcare, this time the insurance industry never employed its vast public relations resources to stifle healthcare reform. While they resurrected the original Harry and Louise, this time, like the insurance industry itself, they were older, wiser, sadder, and fully in support of the proposed reforms.

2) Submit quietly to demonization. A key strategy of proponents of Obamacare was to remind Americans repeatedly that the for-profit health insurance industry is fundamentally evil. This strategy was based on the time-honored precept that it is easier to get the unwashed masses to cooperate through hatred than through reason, and so, to gain their cooperation, one must give them something to hate. Obviously, this strategy meant that the health insurance industry had to accept its role as the bad guys in the reform debates without complaint, and without engaging in any serious self-defense. They did so.

3) Offer subdued public support to Obamacare. The AHIP (America’s Health Insurance Plans) issued public statements every so often that cautiously supported President Obama’s healthcare reforms. But its support had to remain subdued and tepid, since Satan can’t be seen leading the hymns. It was just enough public support to signal opponents of Obamacare not to expect much help this time from this quarter.

4) Whenever necessary, rise up and demonstrate to the world just how evil you really are.  At the end of the day, this was the most important role the insurance industry played in advancing Obamacare. It was certainly their most active role.

It was not a difficult role to fill. Since 1994 the health insurers had engaged in the sorts of truly evil, inhumane, and reprehensible practices that are naturally engendered by covert healthcare rationing, and that harmed or killed many of their subscribers. The only difficult part was choosing which reprehensible behaviors to feature, and when to do it.

In at least two key moments during the fight over healthcare reform – June, 2009 and February, 2010 – when the proponents of reform felt their momentum lagging, the insurance industry intervened with gratuitous evil behaviors whose chief function was to remind Americans just how unremittingly wicked and inhumane they really are. In the second case, at least arguably, the insurance industry turned the reform effort from apparent defeat to almost certain victory. Indeed, it is not too much of an exaggeration to assert that, in the end, the health insurance industry saved Obamacare.

June, 2009: Say Hello To My Little Friend

The debate over Obamacare entered a new phase in May and June of 2009. It was during those months that the opposition to healthcare reform found its voice, and it began to seem as if perhaps the Obama steamroller could really be slowed, if not stopped. People were even beginning to say that many Democrats in Congress, after getting an earful from their constituents when they held their summer town hall meetings, would abandon any idea of supporting President Obama’s healthcare reforms.

Supporters of Obamacare decided it was time to invoke the demons. So in mid-June, the House Subcommittee on Oversight and Investigations called three health insurers to testify on the practice of rescission, and to face not only indignant Congresspersons, but also some of the people who had been personally harmed by their practices.

“Rescission” is when an insurance company voids subscriber’s health insurance when they get sick (after happily accepting premiums from that subscriber, often for many years). Under some circumstances, rescission might be justifiable. It is legal and proper to cancel a policy if the subscriber is found to have purposely lied on the insurance application about a prior illness that is material to the current illness.

But health insurance companies for years have actively and aggressively practiced rescission on subscribers whose insurance applications contained inadvertent and non-material inaccuracies. Furthermore, the health insurance industry does not merely engage in occasional unfair rescission practices; it has industrialized the process (which, after all, is what they’ve always told us they would do to reduce costs). It employs health insurance detectives whose job is to comb the prior medical records of subscribers who are newly diagnosed with certain, expensive medical conditions, looking for even trivial discrepancies on insurance applications, which they can inflate to “fraudulent” omissions, thus voiding the policy. These health insurance detectives are paid by commission, according to how much money their efforts can save the company. Many of them find it a very lucrative career.

So, at the cost of perpetrating a bit of inhumanity, rescission can save insurance companies a lot of money.

Consider some of the individuals who testified in Congress along with the insurance companies on that day:

- A nurse in Texas had her insurance canceled after she was diagnosed with breast cancer because she had failed to reveal that, years before, she had consulted a dermatologist about acne.
- A man (whose surviving sister had to testify) had his insurance canceled before he could begin expensive cancer therapy, because he had not revealed (and indeed he had not known) that a prior CT scan had showed gallstones and an aneurysm – conditions unrelated to his cancer.
- A woman had her insurance canceled – and due to the rescission could not find replacement insurance – because she failed to reveal that, at one time, she had been on medication for irregular menstruation.

During the hearing, the three health insurance executives were caused to listen, on camera, to these and other mind-bending stories describing some of the inexcusable pain, suffering and death their unfair rescission practices had caused, and then were forced to listen to withering commentary by stunned Republicans and Democrats on the Subcommittee, whose own investigation had found that the three companies on the docket had retrospectively canceled the policies of 20,000 sick subscribers over the past 5 years.

After these heart-rending testimonies and the blistering attacks from extremely angry congresspersons, the executives were challenged by Chairman Stupak (D-Michigan) to now commit to discontinuing the practice of rescission unless intentional fraud could be shown.

All three replied, in turn, “No.”

Such a reply, in such a setting, almost defies belief. The only possible explanation, in fact, is that the insurance industry was stepping up to the plate, and embracing its assigned role as the Evil One in the great healthcare debate.

Even the most stone-hearted insurance executive can see that canceling the health insurance of a newly-diagnosed cancer patient, because she’d forgotten she had required acne medicine before the prom 20 years ago, is just a bit unfair. But how did these three executives react? They did not attempt to deny such reprehensible behavior, or to explain it, or to defend it. They were simply defiant about it.

One is put in mind of Tony “Scarface” Montana, bereft of friends, family, allies and bodyguards (albeit because of his own actions), hopelessly surrounded by an army of heavily-armed assassins, screaming, “Say hello to my little friend!” then launching defiantly into a wild, bloody and spectacular suicide.

One cannot for a moment believe that Richard A. Collins, chief executive of UnitedHealth’s Golden Rule Insurance Co., Don Hamm, chief executive of Assurant Health, and Brian Sassi, president of consumer business for WellPoint Inc., would have been stupid enough to publicly defy Congress over such an indefensible practice, if doing so was against their own long-term interests. Appearances to the contrary notwithstanding, they were not auditioning for a remake of Scarface.

This is not how an industry behaves which wants to court the goodwill of Congress at a critical juncture in its life cycle. This is not the strategy of an industry that wants Congress to defy its own party’s President and defeat healthcare reform, or that is begging Congress to give them another chance to figure out how to bring healthcare costs into check. This is not the behavior of any industry that wants to elicit any sort of favorable action from Congress. Indeed, these executives would have seemed more sympathetic and deserving if they had proposed instead to place live puppies on a spit and roast them over an open fire during half-time at the Super Bowl.

There is only one explanation for their astounding public defiance on this matter. Which is, it must have suited their long-term interests.

Recall that at the time of this remarkable hearing, there was growing skepticism about President Obama’s healthcare reform efforts, not only on the part of Republicans, but also on the part of a critical minority of Democrats in Congress. And for the first time since the election, there was some question about whether his reform plan would succeed in gaining sufficient support.

In this light the stark, defiant, public “no” uttered by the three insurance executives makes sense. “Look at us,” they were saying, “See how evil we are! We are utterly devoid of human decency, ethical constraints, or a sense of fair play. If we behave this defiantly when we are in the position of mere supplicants to your eminences, just think how we will behave if you fail to rein us in with new reforms! Abandon all hope, those of you who rely on us for your healthcare, and behold the congressional dogs that placed us in this position of power over your very lives!”

Given the headwinds the healthcare reform effort was to face during the next nine months, it is difficult to say with any certainty how much good the insurance industry did in June, 2009, when it took such an extraordinary step to remind Americans just how incredibly evil it is. But when the time came to help boost the President’s reform efforts, nobody can deny that the insurance industry stepped up and did its duty.

February, 2010: Raising Obamacare From The Dead

Things looked especially bleak for healthcare reform in early February of 2010. The incredible, Constitution-defying, machinations Congress had employed in its desperate attempt to pass healthcare reform had disgusted a majority of Americans, and momentum was clearly shifting to the opponents of Obamacare. And when Republican Scott Brown incredibly won the Senate seat in Massachusetts, robbing the Democrats of their crucial, filibuster-blocking 60th vote, many thought healthcare reform was dead.

But then out of nowhere, in early February, Wellpoint’s California subsidiary, Anthem Blue Cross, announced it was raising its already-astronomical health insurance premiums by as much as 39%, a move that promised to greatly increase the number of Californians who are uninsured.

The demoralized Democrats in the administration greedily capitalized on this new opportunity.

Secretary of HHS Kathleen Sebelius immediately fired off a very public letter to the company, demanding that they justify this unconscionable rate increase. And Wellpoint, lustily assuming its assigned role as villain, was delighted to reply, equally publicly.

We’re in a recession, Wellpoint brazenly asserted, and in a recession, like it or not, people exercise their prerogative to drop their health insurance. The only people who don’t drop their health insurance are the sick people, or those who are likely to become sick, which means that our cost per subscriber goes way up. So naturally, we have to increase premiums. By a lot. It’s just business. That’s just the nature of our current, unreformed healthcare system. So choke on it.

Wellpoint was also kind enough to mention (for anyone dense enough to have missed the point) that the need for higher insurance premiums would be nicely mitigated if everybody was mandated by the government to purchase health insurance.

Wellpoint’s anounced premium increase immediately triggered great volumes of delighted outrage by thankful Democrats, who desperately needed a large dose of “evil insurance company” at just that time. Wellpoint’s action reignited the proponents of healthcare reform, who were inspired to remind all Americans that this is what would happen to everyone if healthcare reform failed, and the greedy insurance companies had their way.

Stunned Republicans, seeing their impending victory over Obamacare evaporating before their eyes, could only issue a few lame and uncomfortable attempts to diminish the significance of Wellpoint’s unfortunate action. But to little avail. The momentum had shifted. At least arguably, it was Wellpoint’s decision to announce an unconscionable rate increase at this extremely critical juncture that put healthcare reform back on the road to adoption.

From a pure business standpoint, there was no good reason for Wellpoint to stir the soup at that moment. Wellpoint at the time was the most financially sound private health insurance company. While its California subsidiary did lose money in 2009, overall the company performed quite well, and reported a very nice profit growth for the year. And with several of its competitors in trouble, Wellpoint stood to do comparatively well for the foreseeable future.

Furthermore, it has since been learned that Wellpoint’s math was bad. An independent actuary working for the California Department of Insurance reported on May 5, 2010 that the company had made “numerous errors” in calculating is rate increases, and further, that Wellpoint could cut its rate hikes substantially, and still meet its required 70% medical-loss ratio threshold. So, uh, oops.

It stands to reason that if Wellpoint really wanted healthcare reform to go away, they would have first checked their math before announcing seismic rate increases, and then, if such astounding rate increases were really needed, they would have waited a few months – while Obamacare died – before announcing their rate hike.

The last thing they would have done is to throw the reformers a critical lifeline just as they were going under for the last time.

In any case Wellpoint’s action, especially at that moment, seems entirely gratuitous. Wellpoint could only have chosen to do its demon dance, at such an inopportune moment, in order to revive Obamacare during its darkest hour.

And that’s precisely what happened.

What This Means

What this means to those of us who would like for Obamacare to go away ought to be quite obvious. Simply nullifying or repealing Obamacare simply will not do. The insurance industry simply will not tolerate it. If we decide we need to get rid of Obamacare, to shed ourselves of the spectre of government-controlled healthcare (and far worse, government-controlled covert rationing), we’ll need to have another solution in hand.

This is Chapter 1 of my book-in-progress, “Open Wide And Say Moo! – The Good Citizen’s Guide to Right Thoughts And Right Actions Under Obamacare.” Comments are fervently sought; you can leave them here.

You can read my rationale for undertaking this project, and thus opening myself up to the possibility of public failure, humiliation, derision, disapprobation, and unwanted scrutiny, here.

And here is the up-to-date archive for all the chapters that have been posted so far.
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Part 1 – Progressive Healthcare, and Why We Have Chosen It

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Chapter 1 – Run For The Hills, As We Are All Doomed!

I originally meant to call this chapter, “Healthcare Economics,” but I decided that name would frighten people off.

Everyone (that is, everyone with an ounce of common sense) is frightened by economics. Economics is the index case of what happens when you attempt to apply mathematics and the language of science to what is essentially a study of human behavior. (Microeconomics, as I understand it, attempts to study the behavior of one or two guys at at time; macroeconomics purports to study the behavior of everyone, all at once.)

Human behavior will stymie anyone who tries to understand it, let alone predict it, or especially control it. (Even God, according to Genesis, became so frustrated with human behavior that on at least one occasion he was moved to wipe just about everybody out and start over. And all to no avail, one must note.)

And so economists, having dedicated their lives to studying something that intrinsically surpasses all understanding – such that even astrophysicists seem closer to their goal of understanding what happened before the Big Bang than economists are to theirs – are reduced to devising massive, complex and unlikely constructs of mathematical clockwork only they can understand, with which to pummel one another in professional meetings, in peer-reviewed publications, and on CNBC.

Oh, and they also advise our political leaders.

So I have called this chapter by a name that is far less alarming than “Healthcare Economics,” and that I hope will not send readers scurrying away. Besides, the name I have chosen is at least partially true. For it seems reasonably likely that we are indeed all doomed, though heading for the hills probably will not help very much.

Assuming that we can avoid the Really Bad doomsday scenarios that are always out there (collisions with asteroids, nuclear war, electromagnetic pulses, sudden ice ages, &c.), then the thing that is most likely to produce among us the renting of clothes, gnashing of teeth, heaping of ashes upon heads, and other behaviors commonly associated with the End Times, is the fiscal black hole we’ve made of our healthcare spending.

Our healthcare spending is sufficiently out-of-control that it produces a real threat to our survival as a society, and within many of our lifetimes. It was largely the effort to control this runaway spending that led us to adopt Obamacare in the first place, even though Obamacare (as I hope to demonstrate) promises to be almost as destructive itself.

The first five chapters of this book that comprise Part I aim to show how our healthcare system’s dire fiscal problems have led us to choose a Progressive healthcare “solution.” Here in Chapter 1, I will describe the astounding magnitude of our healthcare system’s financial mess, and how we have created it. In Chapter 2 and 3, I will survey some of the incredibly harmful changes we have made to our healthcare system in an attempt to cope with the fiscal mess. These changes have caused so much damage that, when it was time to try to choose among the four possible methods for bringing the costs of healthcare under control (which are described in Chapter 4), we finally acceded to the Progressive solution many of our elected representatives had been pining for for at least 20 years. Accordingly, in Chapter 5 I will discuss the Progressive program in general, and show why control over our healthcare is the lynchpin to the Progressives’ overarching plans for all of us.

The Fiscal Golden Age of Healthcare

Once Upon A Time, when people received a service from a physician, they paid for it themselves. Physicians who wanted to maintain a viable practice would keep their prices within the reach of their patients. And if somebody could not pay they would typically accept a reduced fee, or even a couple of chickens in exchange. During this time, healthcare was not considered a crisis, or a right, or even very important in the lives of most people.

I call this the Lancing Boils And Getting Paid In Chickens era of healthcare. It was the dark age of medicine – there was generally very little a doctor could do for you, other than lance those boils, set some but not all broken bones, and hasten your demise with leeches and bleeding. (At this point we must say a prayer of thanks that Progressives care very little about history, and so are relatively unlikely to re-discover the benefits of leeches and bleeding.) But while it was the dark age of medicine, it was the Golden Age of healthcare finance. Healthcare in those times accounted for none of our (or anyone’s) national, collective debt.

Even when inhaled anesthesia first came into common usage – making various surgical procedures such as appendectomy and Caesarian sections routinely available for the first time – the cost of healthcare was not considered a major societal problem. Somehow, arrangements were made to reimburse doctors for their services, whether through cash payments, barter, or some sort of Victorian E-Z payment plan, thus allowing the patient to avoid destitution, and the doctor to avoid the sundry nefarious activities that have always been available to cash-strapped medics.

Indeed, right up until World War II, when penicillin was discovered, physicians and their skills could offer relatively little benefit for most serious illnesses beyond the surgical variety. As a result, relatively little money was spent on healthcare. And by the traditional means of barter or negotiated settlements, or the more modern means of charity hospitals, hospitals run for their employees by the big railroad and lumber companies, or in the later years, fledgling Blue Cross plans, all the medical services that were considered useful were somehow paid for on an as-you-go basis. There was no fiscal burden placed upon society. And all was well.

Unless you got sick.

The Medical Golden Age

Conservative Americans can rant and rave about it all they want, but the fact is undeniable that the remarkable advances we’ve seen in American healthcare over the past 50 – 60 years were ushered in by a new fiscal era – an era in which we began to pay our healthcare costs collectively.

This new era was begun during World War II, when companies began offering health insurance to their employees in order to attract workers during the wage controls then in effect. Health insurance proved so popular that Congress changed the tax laws to make the insurance premiums paid by employers tax-deductible so as to encourage the practice, and before very long virtually every company provided health insurance to their employees as a matter of course.

The tax-deductibility of employer-provided health insurance was the game-changer. Healthcare costs suddenly were no longer borne entirely by individuals, or by individual businesses who paid the insurance premiums. Instead, they were distributed among the American taxpayers, whose taxes had to make up for the insurance deductions taken by businesses. So-called “private” health insurance became publicly subsidized.

The public funding of healthcare advanced by a giant step with the institution of Medicare and Medicaid in 1965, which amounted to direct public funding of healthcare for a large proportion of the population. So, by 1970, most of American healthcare was paid for by the taxpayer either directly, or indirectly through subsidized private insurance. We had largely collectivized the financing of our healthcare.

While most of my Conservative friends would like to think otherwise, when you look at the big picture it becomes apparent that this collectivization of healthcare financing has not been the unmitigated disaster they like to claim. There have been substantial benefits, and chief among these is the incredible progress we’ve made in medical learning and medical technology over the past half century.

In fact, this taxpayer subsidization of healthcare catalyzed an incredible golden age of medicine.

It turns out that, the moment everything that is deemed “healthcare” is “covered” by taxpayer-supplied or taxpayer-subsidized health insurance, and therefore payment is guaranteed for virtually any medical product by the full faith and credit of the United States government, a huge amount of investment money suddenly appears to fund research and development in every aspect of medicine you can imagine. And the next thing you know, you’ve got medical progress.

Medical entrepreneurs figured out in about a minute and a half that to be successful, all they had to do was to come up with a product that offered a measurable benefit to some group of people with some illness – no matter how marginal that benefit might be, or how expensive their product – and they were certain to have a ready market for their product and a customer who would pay the going rate without complaint. The more products you could develop, the greater your profits. And so R&D budgets went through the roof.

An utter explosion in medical progress, virtually all of it arising in the United States, began in the 1950s and 1960s, and really accelerated in the 1970s when Medicare was up and running full-bore. With a bit of sputtering, it continues until this day. Except for the Manhattan Project and the moon shot (whose fruits medical researchers strongly relied upon in doing their work), the kind of concentrated scientific effort that was applied to advance the science of medicine during this interval is unsurpassed in human history.

And like the Manhattan Project and the moon shot, it was ultimately funded by the taxpayer.

The medical technology that has been developed since the 1950s has done immeasurable good. Uncountable heart attacks and strokes have been prevented or aborted; cancers have been cured or beaten back; people who formerly would have been crippled can conduct normal daily activities without assistance; and some scourges of mankind (such as smallpox and polio) have been nearly vanquished altogether.

But there is a problem. Coincident with this explosion in medical progress has been an explosion in medical spending, spending to such a degree that, unless we bring it under control, we are headed for societal chaos.

The Magnitude of the Problem

A fundamental principle in economics is that when we are buying consumable products that we are consuming ourselves – like Caribbean cruises, sports cars, ice cream, or healthcare – we should spend no more on those products than we individuals are able to pay ourselves.

I realize that by adding healthcare to this list I have probably angered a lot of readers. But I assure you that I am not making a political statement here; I am simply stating an economic principle, which (as is the unfortunate case with principles) is inherently true even if inconvenient.

It is certainly true that some societies, including ours, have decided to purchase some of these consumable products (healthcare, for instance) collectively, so that individuals don’t pay for them at all. And the collective purchase of consumables constitutes a somewhat different situation that I will address in a moment.

But for consumable products that everyone agrees ought to be paid for by the individual (let’s just take Caribbean cruises as a relatively non-controversial example), the individual must arrange to cover the cost. The reason for this principle is obvious. If individuals could arbitrarily decide to go on a cruise whenever they’d like, but leave the cost to others who have no say in whether the cruise takes place, the economic system would soon collapse.*

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*Like most laws, principles, and ethical mandates, this one can be systematically violated by certain, small, well-defined groups of people without crashing the whole system, as long as the rest of the population (for whatever reason) decides to overlook, tacitly approve of, and pay for the irresponsible behavior of this elite group. I am referring, of course, to our political leaders.
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But what about those societies which have decided to collectively purchase certain products and services (like healthcare) that are consumed by individuals? It turns out that these societies must operate under a very similar economic principle: A society should spend no more on products which are consumed by individual citizens than it can pay without incurring long-term, multi-generational debt.

In the United States as we have seen, we have decided to pay for healthcare collectively. Whether your healthcare is provided directly through government payments or through tax-deductible insurance premiums, to a great extent society is collectively footing the bill.

This would not be a problem, economically, if we were doing it on a pay-as-you-go basis. But we’re not. We’re running a huge national debt today, and largely because of healthcare obligations that debt will reach stupendous proportions in the foreseeable future.

Reasonable people can argue over whether having a large national debt is good or bad, but the answer lies at least partially in what it is that the debt has been incurred to pay for.

The ability to borrow money, and carry debt, is important to a vibrant economy. Individuals can borrow even large amounts of money as long as they promise to pay it back and their credit rating is sufficiently high. But if a person fails to pay back what they owe according to a predetermined schedule, society takes steps to stop further borrowing and to force them to repay. If they get in too deep, society ushers them into bankruptcy, and allows them to slowly make themselves whole again. But society does not allow them to simply keep borrowing indefinitely.

This is because individuals die. If we were to allow individuals to simply accumulate as much debt as they want until they die, leaving it to somebody else to pay it back, the economic system would soon disintegrate. So before people can borrow money, they need to demonstrate their ability to repay it, or to have their estates repay it upon their death. In this way there is a natural limit to how much individuals can spend on consumable products in their lifetime.

Societies, like individuals, must borrow no more than they can eventually pay back. The difference is that, unlike individuals, society lives “forever.” That is, the accumulation of debt that cannot be paid off in a single generation is not necessarily alarming, because society will “always” be there to pay it off.

As it turns out, the ability to accumulate even huge amounts of debt is vital for complex societies like ours, as it permits us to maintain a buffer for economic stability, to smooth out boom-bust cycles, and to maintain reasonable predictability, stability, and steady growth. The ability to carry multi-generational debt enables the government to borrow the money it needs to make multi-generational investments, things like building up the nation’s infrastructure, providing for national defense, advancing medical research, and engaging in other forms of non-commodity spending that will allow society to progress, to grow stronger, and to steadily improve the lives of successive generations of its citizens.

The “right” kind of long-term national debt, then, is a chief enabler of economic growth and prosperity, an investment in the nation’s future. It is appropriate to ask future generations of Americans to share the financial burden of that debt, since they will reap the benefits of the investment.

Things go very wrong, however, when we burden society with the “wrong” kind of debt, the kind that represents an open-ended promise to purchase products and services that are consumed by individuals, such as healthcare. There are two problems with this kind of debt.

First, this kind of debt is not an investment in the future, whose fruits will be realized by our children and grandchildren, and whose returns will more than compensate for the overall debt obligation. Instead, it benefits only the individuals currently alive who are the direct recipients of the consumable services, leaving no direct benefits but only an ever-increasing debt burden to those who will be left paying the bills decades later.

Second, while there is a natural limit on how much an individual can spend for products and services they consume during their lifetime, once the responsibility of paying for those consumables shifts to society there is no longer such a natural limit (since societies live forever). The debt can now be borne by multiple generations. Because there is no longer an inherent limit to what an individual can consume, and because it is to the advantage of present and would-be officeholders to eliminate any remaining arbitrary limits, individuals are eventually encouraged to consume as much as they want. And without these limits (whether natural or imposed by rules) the provision of such services to individuals rapidly becomes an entitlement, whereupon the natural checks and balances that (in past times, at least) apply to other parts of the federal budget are no longer available.

When society faces an accelerating debt burden that is completely open-ended and is not subject to normal checks and balances, that society is dealing with a “disproportionate economic variable” (DEV) – that is, an economic obligation that grows without limit and completely out of proportion to the growth of the overall economy. Healthcare spending, which unrelentingly consumes an ever-increasing proportion of our GDP, is such a DEV.

DEV’s are inherently destructive to a society, and for that reason they are typically rare. Indeed, in viable societies the only commonly encountered DEV is wartime spending, where a disproportionate amount of a society’s wealth must be spent in the violent struggle for survival (or, alternatively, in the violent struggle to take away valuable resources of the opponent in order to power future growth, in which case war is analogous to a high-risk start-up). Indeed, the disproportionate spending in wartime is tolerable only because war itself is temporary. It should be noted, however, that one reason war is temporary is that in a prolonged war, a runaway DEV can cause a country to spend itself into oblivion. (See: the multi-decade Cold War and the demise of the Soviet Union.)

Until the time we began to collectivize our healthcare expenditures, healthcare spending in the United States acted like any well behaved economic sector. That is, until the 1950s healthcare spending remained at a steady 4% of the GDP. But by 1960, healthcare spending had become a DEV. Healthcare spending was at 5.3% of the GDP in 1960, 7.3% in 1970, 10.2% in 1980, 13% in 1993, 14.9% in 2002, and 17.6% of the GDP in 2009.

We already cannot afford to pay-as-we-go for all the healthcare we’re consuming. Instead, we’re violating that economic principle I mentioned earlier, and accumulating massive amounts of federal debt to cover the cost ($16 trillion at last count, enough that we’re already flirting with fiscal brinkmanship), which we are leaving to future generations to figure out how to pay off. And it’s about to get much worse.

Assuming we survive credit downgrades, the European debt crisis, oil disruptions in the Middle East, and other more routine difficulties, the most immediate fiscal threat to our economic survival becomes apparent when you think about all the expensive medical technology we’ve managed to accumulate over the last 50 years, and imagine applying it to our rapidly aging population, that is, to the baby boomer generation – which (I can personally assure you) is planning to make exuberant use of all this stuff. The magnitude of this problem is actually pretty easy to estimate.

Consider: All the people who will constitute our population of Old Farts for the next 30 years (a group which already claims your humble author as a proud member) are alive today. We can count them. We can also enumerate the quantity of many of the various illnesses and ailments they will suffer – the strokes, heart attacks, heart failures, Alzheimer’s disease, hip replacements, cancer, drooping body parts and ED – with fair accuracy. And we can estimate reasonably closely (if our leaders succeed in stifling medical progress, and therefore medical technology is held at its current level) what kinds of drugs, devices, nursing care and other expensive medical appurtenances they will require. And with this information we can add up all the sums and multiply all the multipliers to estimate what it’s all going to cost us.

Indeed, the GAO has done this. It’s looking like it will cost $30 – 40 trillion over the next several decades, just to cover the medical entitlements which we have promised current and not-too-distant-future older Americans, Americans who have themselves been paying taxes for many years, and who have arranged their affairs according to the expectations created by those promises.

That’s way more money than it will take to cause societal collapse.

Can’t We Just Eliminate Waste and Inefficiency?

In Chapter 4, I will talk about the four ways that are available to reduce this dangerous level of healthcare expenditures. You may be surprised to learn that none of these four methods is to eliminate all the waste and inefficiency in our healthcare system.

I am in favor of eliminating waste and inefficiency, of course, and I applaud most efforts to do so. But eliminating waste and inefficiency did not make the list of four for a simple reason. It will not work. That is, even if we somehow got rid of all the wasted healthcare expenditures taking place today (and there truly is a tremendous amount of it), that won’t be enough to rescue us from economic oblivion.

This is not a pleasant thing to hear, nor is it a common thing to hear. Indeed, it is a central assumption of all of the healthcare reform plans ever proposed that we can get our spending under control simply by eliminating – or at least substantially reducing – the vast amount of waste and inefficiency in the healthcare system. Conservatives propose to do this by incorporating the efficiencies of the marketplace, thus eliminating the waste and inefficiency imposed by government bureaucrats. Progressives propose to do it by adopting and enforcing strict, top-down regulations (ideally, through a single-payer system which employs the officially-perfect wisdom of various expert panels) that will control the wasteful and inefficient behaviors of greedy and/or ignorant healthcare providers. But one way or another, schemes for reforming healthcare all propose to bring spending under control by eliminating waste and inefficiency.

Another way of describing what all the reformers across the political spectrum are telling us is: There is so much waste in the system that we can avoid healthcare rationing by getting rid of it. Most Americans believe this. Most policy experts believe this. They have to believe it, because nobody wants to even think about healthcare rationing.

But this is unfortunately false. No matter how much waste and inefficiency you think might be gumming up our healthcare system today, there’s not enough to explain the uncontrolled rise in healthcare spending we have been seeing for decades, and therefore, not enough to allow us to avoid rationing altogether in any economically feasible, publicly funded healthcare system.

To understand why this is the case, we must first recognize the fundamental problem with our healthcare spending. The real problem is not simply that we’re spending a lot of money on healthcare, or even that we’re spending a larger proportion of our GDP on healthcare than any other country. If that’s all the problem was, we could with modest difficulty adjust the rest of our spending to accommodate it, and get our national budget under control that way.

Rather, the real problem is that our healthcare expenditures for decades have been growing at double digit rates, several multiples faster than the overall inflation rate, and each year consumes an ever-greater proportion of our national spending. Unless this disproportionate rate of growth is stopped, eventually healthcare spending will cannibalize our entire economy. (What will really happen, of course, is that the debt we are accumulating to pay for our healthcare will grow to the point of producing societal upheaval, sending us back to a more typical era for mankind, where healthcare is a little-thought-of luxury, and not a necessity or a right. This will happen well before healthcare consumes 100% of the economy.)

To reiterate, it’s not the amount of spending on healthcare that is creating a fiscal crisis, it’s the rate of growth of that spending.

Once we understand the problem – that it’s the rate of growth of healthcare spending that threatens our society – then demonstrating that waste and inefficiency cannot possibly account for that rate of growth is a matter of simple mathematics.

There are only two things that can possibly account for the excessive growth rate of our healthcare expenditures. Either it is caused by unrelenting growth in wasteful spending (as we are assured by our political leaders), or it is caused by unrelenting growth in useful healthcare spending. If it is the latter, then in order to get spending under control in a collectivized payment system we must cut back on or ration useful healthcare. This is why we all fervently pray, and most of us choose to fervently believe, the excess rate of growth must be caused by wasted spending.

This desired conclusion, unfortunately, leads to mathematical absurdities, and therefore (for anyone who eschews magical thinking) turns out to be utterly false.

I am going to show you some data from a spreadsheet. My spreadsheet illustrates what would have to happen in order for wasteful spending to account for our current level of healthcare inflation. The spreadsheet is based on the following four assumptions:

Assumption 1) The annual growth rate of spending on useful healthcare (discussed further below) is economically well-behaved. That is, it matches the rate of overall inflation. The spreadsheet therefore assumes a 3% annual inflation rate for useful healthcare spending.

Please note that this is the very assumption which politicians invoke whenever they say that all we need to do to control healthcare costs is to eliminate waste and inefficiency. In fact, the whole point of this spreadsheet is to test the logic of this assumption. For, if useful healthcare spending is not economically well-behaved, then eliminating all the wasteful spending would still leave us with disproportionate healthcare inflation.

Assumption 2) 25% of healthcare expenditures at Year 1 of this spreadsheet are wasteful. I have picked 25% arbitrarily, a value that happens to fall within the range of popular estimates. As it turns out, the initial value we choose for the level of wasteful spending at Year 1 in this spreadsheet has very little influence over the outcome. So if you don’t like this number, feel free to pick your own.

Assumption 3) The annual rate of growth of overall healthcare spending (i.e., healthcare inflation) is 10%. This is a rough average of what we have actually seen for the last few decades.

Assumption 4) Total healthcare inflation is the sum of healthcare inflation due to the growth of “well-behaved,” useful healthcare spending, and the healthcare inflation accounted for by spending on waste and inefficiency. Given that the inflation rate for useful healthcare spending is 3% (Assumption 1), this spreadsheet simply calculates the cumulative annual inflation rate for wasteful spending that would be necessary to account for an overall rate of healthcare inflation of 10% (Assumption 3).

Before I show you the spreadsheet, we should discuss the difference between “wasteful” and “useful” healthcare. In actual practice, this is not a distinction which is straightforward. It depends, for one thing, on who gets to define “wasteful.” If I’m a 92-year-old man who gets a $12,000 stent procedure to eliminate my angina, I and my doctor might consider it money well-spent, while you might consider it wasteful.

But for the purposes of this present analysis, I am defining “wasteful” healthcare in the way our politicians define it – or at least in the way they want us to think they are defining it. That is, wasteful healthcare is completely wasteful – it is a totally useless expenditure, and is no more beneficial than flushing money down the toilet. In contrast, useful healthcare is that which is likely to provide at least some of its intended benefit to patients.

Any other definition of useful vs. wasteful healthcare would require us to place a value judgment on just how much benefit a healthcare service must provide before we consider it to be useful, and thus worthy of paying for. Another name for such a process is “rationing,” and we all know that we’re not going to do any rationing. No, sir.

So, the definition we must use for “useful” vs. “wasteful” healthcare, by process of elimination, can only be the definition I have just laid out.

Here is the spreadsheet:

Year	Index of overall Dollars Spent per year	% wasteful spending	% of annual increase due to useful spending	% of annual increase due to wasteful spending
1	100	25%	-	-
5	146	42%	18%	82%
10	236	59%	13%	87%
20	612	78%	7%	93%

We can immediately see several things. First, as expected, the amount of money we’re spending on healthcare, assuming a rate of healthcare inflation of 10%, is doubling roughly every 8-9 years. It’s this growth rate that threatens our survival as a society.

Second, in order to account for this unsupportable growth in healthcare spending by invoking waste and inefficiency, the proportion of healthcare spending that is caused by waste must increase to ridiculous proportions very rapidly, such that (for instance) by the 10th year we will have more than doubled (59%) the proportion of all healthcare expenditures that are wasteful; and by the 20th year, nearly 80% must be wasteful.

Similarly, the proportion of the annual increases in healthcare spending that would have to be due to waste and inefficiency rapidly climbs to equally ridiculous proportions. By year 5, wasteful spending will have to account for 82% of the annual increase in healthcare expenditures, and that proportion continues to climb, eventually approaching 100%.

To me, these numbers seem absurd on their face. But if you still need to be convinced, consider that in real life, runaway healthcare inflation has already been taking place in the United States for decades – so our position on such a spreadsheet would not be at Year 1; we are much closer to Year 50. And no matter what value for wasteful spending we might have plugged in at Year 1, by Year 50 wasteful spending would have to be well above 80%, and more likely approaching 100%. In order for waste and inefficiency to account for the situation in which the American healthcare system finds itself today, therefore, one would have to believe that virtually all healthcare spending is wasteful. (And if you believe that, then solving the crisis would be a simple matter of discontinuing all healthcare.)

Now let us illustrate the same point in a slightly different way. This time, let’s pretend that as recently as 2009, when President Obama was inaugurated, our healthcare system was 100% efficient. That is, only three years ago there was no waste whatsoever. Then let’s allow that the remaining three assumptions given above are still operative. The following table results:

Year	Index of overall Dollars Spent per year	% wasteful spending	% of annual increase due to useful spending	% of annual increase due to wasteful spending
2009	100	0%	100%	0%
2010	110	7%	30%	70%
2011	121	15%	28%	72%
2012	133	17%	26%	74%

We can see from these results that, even if only three years ago we had a completely efficient healthcare system, in order for waste to account for the excess growth in healthcare spending we’ve experienced since that time, then after just three years as much as 74% of today’s annual increase in spending has to be due to waste and inefficiency.

Any way you cut it, the spreadsheet leads to nothing but absurdities. Assumption 1 – that useful healthcare spending is economically well-behaved – therefore cannot be true.

Wasted spending may and likely does account for a significant proportion of our healthcare expenditures, but it simply cannot account for the sustained, disproportional growth in healthcare expenditures that threatens to collapse the system.

So yes, by all means, let’s try to eliminate waste and inefficiency from our healthcare system. But if we hope to survive as a culture, we will, at the same time and as an entirely separate endeavor, have to figure out how to get the growth in useful healthcare spending under control.

Summary

It is critical to understand that a fundamental, nearly intractable, doomsday-magnitude fiscal problem with our healthcare spending preceded Obamacare, and continues today. That fiscal problem will remain whether we proceed with Obamacare or not. Simply striking it down in the courts or repealing it will not help fix the underlying problem.

Here is the introduction to my book-in-progress, “Open Wide And Say Moo! – The Good Citizen’s Guide to Right Thoughts And Right Actions Under Obamacare.” Comments are fervently sought; you can leave them here.

You can read my rationale for undertaking this project, and thus opening myself up to the possibility of public failure, humiliation, derision, disapprobation, and unwanted scrutiny, here.

And here is the up-to-date archive for all the chapters that have been posted so far.

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From the Front Matter

“It will be of little avail to the people, that the laws are made by men of their own choice, if the laws be so voluminous that they cannot be read, or so incoherent that they cannot be understood.”

- James Madison, The Federalist #62

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“The human race divides politically into those who want people to be controlled and those who have no such desire.”

- Robert A. Heinlein
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“Today, this isolated relationship [between doctor and patient] is no longer tenable or possible. . . Traditional medical ethics, based on the doctor-patient dyad, must be reformulated to fit the new mold of the delivery of health care. . . The primary function of regulation in health care. . .is to constrain decentralized individualized decision making.”

- From the ominously titled “New Rules,” Donald Berwick, MD and Troyen Brennan, MD

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From a recently discovered fragment, attributed by some to Plato:

Meno: This DrRich (whoever he is) has badly mishandled the title of his book. It’s not possible for a person to open their mouth wide while saying moo.

Socrates: It would certainly seem so. But I’ve heard of this DrRich. He is playing with us.

Meno: There’s a message in the title then. That being the case, then obviously he is attempting to draw a comparison between patients and cattle.

Socrates: Yes, it seems to be true. In his earlier writings he has often said that in his land they are establishing a new healthcare system that will treat patients like the interchangeable members of a herd of beeves.

Meno: Well, he would have been better off comparing them to a herd of sheep. After all, one can open one’s mouth quite nicely while saying, “Baaa!”

Socrates: But the fellow is reputed as sly. He chose “Moo” for a reason.

Meno: It doesn’t make sense. No doctor who truly wanted to do a thorough examination of a patient’s oral cavity would ask the patient to purse their lips in such a manner. (Never mind while asking them to make such a demeaning sound!)

Socrates: Precisely. Does it not follow, then, that for some unfathomable reason the doctor does not actually intend to do a thorough examination? But that at the same time, apparently, he wants to pretend otherwise – possibly to himself as well as to his patient?

Meno: You’re proposing that the doctor, by saying “Open wide” as if a full examination is about to take place, is engaging in a purposeful fiction? A fiction which he reveals in the very next moment when he specifies exactly what he means by “wide?” It makes no sense.

Socrates: But doctors do something like this all the time. Has no doctor ever said, “This won’t hurt much,” just before he does something unspeakble to you?

Meno: Certainly. It’s how they earn their drachmas. But my doctor is simply trying to get me to hold still long enough for him to violate my person (only in the most professional way, of course). In contrast, the strange doctor imagined by this DrRich is telling his patient, “I’m going to do an extremely inadequate and cursory examination of your oral cavity, and we’re both going to pretend I gave you the full bore going-over you ought to expect from a competent physician.”

Socrates: Sad, but true. But there’s one more thing – one more particularly disturbing thing – implicit in the doctor’s command to open wide and say moo.

Meno: You mean that, for such a singular and inappropriate command, it is delivered very matter-of-factly?

Socrates: Yes, my young friend. The attitude of supreme confidence this command carries with it is remarkable. The doctor clearly expects that his patient will comply fully with the fiction he is proposing to perpetrate, without protest or complaint, even though compliance is to the patient’s own detriment, and furthermore that the patient will do so with the most submissive of utterances.

Meno: It’s absurd to postulate such a thing. You give DrRich too much credit. I think he is simply an ass, and botched the title of his book.

Socrates: Let us see.
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Introduction

The title of this book is not as ill-chosen as you may think at first glance. It is, in fact, a particularly apt illustration of my overall theme.

Under Obamacare, or under any Progressive healthcare system, the Good Citizen must learn to develop the proper mode of thought. When a doctor or some other agent of the healthcare authority informs you with all apparent sincerity that something is true, while their every action indicates that something quite different is true, and you choose to believe what you are told, instead of what your own senses are saying to you, this is called right thinking. Then when you act on what you are told, again in contrast to all the evidence to the contrary, it is called right action.

“Open wide and say moo” is therefore a metaphor that suggests how we as patients are likely to be treated under Obamacare, and it implies how we are expected to respond.

To such an absurd command a skeptic would reply, “What in the hell are you talking about? Do you want me to open wide or not? And what the hell is this ‘moo’ business?”

This is neither right thinking nor right action.

In contrast, right thinking will allow you to process such a request from your doctor in the proper way. You will recognize that the vague command to “open wide” is a mere courtesy. It is a way for you (and your doctor) to pretend that a thorough oral examination is about to take place, and thus to feel better about the kind of healthcare you are about to receive (or give). The real command, you will recognize, is the more specific one, the one that, in essence, defines what is actually meant by “wide.”

And so: Being a Good Citizen (and thus a perfect Obamacare patient), you will purse your lips, just barely wide enough to allow your ObamaDoc (a doctor whose primary interest is in keeping the Central Authority happy) a quick, cursory look at your oral cavity, the kind of look that will certainly preclude discovering anything amiss, and you will simultaneously utter that most placid noise of bovine compliance.

For Obamacare to work, you will need to accept that the quality of healthcare you are receiving is precisely the high quality the Central Authority insists you are receiving, which is to say, the highest quality that can possibly exist – despite the obvious evidence you may notice (if you are of a mind to notice) that it is not.

The people who will run Obamacare, we must realize, will not be lying to us. They actually will believe what they are saying. They fully expect us to believe it, too, and they will become quite exercised if they begin to perceive we do not. Here, an analogy to religion (which will be a recurring theme in this book) is apropos.

When something horrible has happened to you or a loved one, your pastor is likely to tell you that we must all trust that God has a plan, and that in God’s plan what seems very bad to us today must always serve God’s higher (if hidden) purpose. And we must have faith that some day, when it is all done, we will understand that higher purpose, and we will rejoice.

Similarly, when we think we see something terribly awry with the healthcare we or our loved ones are receiving (or not receiving, as the case may be), we will be exhorted to trust that the Central Authority also has a plan that serves a higher purpose. And just as true believers will be rewarded with God’s higher purpose in the end, so will the Good Citizen, by and by, be rewarded by the fruits of the Central Authority’s own supreme plan (as long as he or she does not become too disabled or too dead to appreciate it).

It is critical to understand that Obamacare, or for that matter, any Progressive program for societal improvement, simply will not work without your full buy-in and full cooperation – without your right thinking and right action. For this reason the Central Authority is very, very, very interested in making sure you develop these proper ways of thinking and acting.

Right thinking, in essence, is faith that the enlightened expertise embodied within the Central Authority knows what is best, for us and for all. And right action is complying, without complaint, with that central judgment. (For practical purposes, of course, right action will suffice all by itself, as long as you refrain from expressing too publicly your not-right thinking.)

The utter inability of most people to comply with these simple (but non-negotiable) requirements is precisely why no Progressive program for societal improvement, anywhere, has ever worked well for a very long time.

The closest that Progressive policies have ever come to realizing the universally beneficial ends which Progressives always promise has likely been in the Scandinavian countries. Here, the trauma of the World War II experience, combined with a homogenous population sharing a deeply-felt common goal, resulted in a generation of citizens who were truly dedicated to the attitudes, thoughts, and actions (specifically, working hard and tirelessly for the good of the whole), which were needed to make their collective society a success. Their children’s generation was slightly less dedicated to selfless action for the sake of the collective. Their grand-children’s generation seems far less so. Today, even Scandinavian socialism is fraying, at least around the edges.

Perhaps three generations of Good Citizens is the most Progressivism can hope for, even under the most favorable conditions.

In any case, we in the United States, through our duly elected representatives, are now committed to Obamacare. And if the Supreme Court later this year throws out the individual mandate and drives a stake through the heart of Obamacare, odds are high (as I will explain later) that shortly thereafter we will just end up with Obamacare II (or, more accurately, Hillarycare III).

And given the strong likelihood that we will all be enjoying our healthcare very soon under either Obamacare or its equally Progressive successor, it behooves us to understand what, exactly, our new healthcare system will require from each of us in order to function as it is intended. These requirements, whether we choose to understand them or not, will turn out to have a major influence over all of our lives (and limbs). But by understanding the requirements which are being placed upon us, then we can each decide whether we will be a Good Citizen – or something else. (While it may not always be easy or pleasant – or perhaps legal – there is always a something else.) So, a main goal of this book is to explore the requirements placed upon all Good Citizens by a Progressive healthcare system – what those requirements are, why they are non-negotiable, and what our options may be, as individuals, relative to them.

If Obamacare is a terrible mistake, as I believe it is, when we allowed our leaders to choose it we at least made an explicit recognition that the status-quo is no longer feasible. It is infeasible because our present out-of-control healthcare spending promises to trigger societal destruction within a few decades.

But the cure we have chosen – moving to a Progressive healthcare system – is likely as bad as the disease. I hope to show why this is so, and perhaps to convince a few people that, before it is too late, we ought to explore a different option for bringing fiscal sanity to our healthcare system.

Unfortunately, our window of opportunity to change paths is narrowing quickly. Once Obamacare (or any Progressive healthcare system) moves beyond a certain point, entropy will dictate that it cannot be undone, short of the traditional method for un-doing the various massive, elaborate, Byzantine constructions mankind is perpetually inventing, which is to say, via total societal collapse. So time is of the essence, which is why I have decided to publish this book in real-time, on-line, as I write it.

This book is divided into three parts.

In Part 1, we will discuss how and why it looks (so far, at least) like we are going to end up with a Progressive healthcare system. We will consider the fiscal black hole our healthcare system has become, and show why some fundamental change in American healthcare has been inevitable for years (whether we take purposeful action to effect such change or not). We will have a look at the four ways it is possible to get healthcare costs under control. (Yes, there are four.) (And yes, there are only four.) Of the four, we as a nation have chosen the Progressive solution, since its proponents can always make it sound the least painful. For this reason we will end Part 1 by considering the general Progressive program for societal perfection, a program which will determine the chief characteristics of our new healthcare system.

In Part 2, we will survey what Obamacare will look like once it is fully rolled out. We will examine its basic tenets, and the implications and mechanics of the herd medicine it will impose. We will consider the kinds of things you will experience personally when you seek healthcare (or are ordered to get some) under Obamacare. Finally, we will survey some of the bigger-picture aspects of Obamacare, such as “life-cycle” medicine (i.e., aged-based priorities for healthcare), and how and why Progressives will stifle medical progress.

Part 3 can be entirely skipped by anyone who likes what they’ve read about Obamacare in Parts 1 and 2. (Your right action, in placing this book aside, should go a long way toward paying your penance for picking this book up in the first place.) Part 3 will examine what we can do, as individuals and as groups, to protect ourselves from some of the hazards of Obamacare, to reverse its most odious parts, and even to begin to construct a replacement healthcare system that might avoid the fatal flaws not only of Obamacare itself, but also of the Pre-Obamacare system of healthcare which has led us to it.

None of this, I understand, constitutes a particularly happy message. So I will try to keep it relatively light, employing along the way a bit of irony, sarcasm, wry humor, perhaps some puns (though very few if I have anything to say about it), and in general my sunny disposition. Just keep in mind, amidst all the merriment, that we are still pretty much screwed, unless we decide to do something about it.

I will end this Introduction by inserting a statement that many may consider out of place, and which others may feign not to understand, and which still others may find insulting, but which may come in handy for me, personally, at a later date. To wit: I hereby fully acknowledge that good people can be led astray by Wrong Thinking, and I believe that sometimes, even having passionately expressed such wrong thoughts in word and deed (say, in book form), many of these good people can be brought back into the light, if they are shown sufficient mercy and understanding. I therefore deeply pray, and fervently hope, that when such strayers are brought to judgment, the Central Authority will give strong consideration to attempting their reeducation and rehabilitation, rather than immediately submitting them to the more final penance of auto-da-fe.