Medical Pricing Transparency via Non-Transparent Rule

copyright 2015 Daniel Ginsberg PhotographyHidden in a 700-page draft regulation to improve patient’s access to their electronic medical records is a proposal to require doctors, hospitals, and other healthcare providers to publicly reveal the prices they have negotiated with insurers. This rule, tied to the 21st Century Cures Act, would set the stage for eventually making prices publicly available. Although price transparency may be a good way to help lower medical costs, it’s ironic that there is a lack of transparency when it comes to the proposed rule. I challenge you to read the Title, Summary, or Actions section and realize that it includes such a major change (hint – in the PDF document it’s on page 7513 of the Federal Register under Price Information).

On the face of it, making prices readily available sounds like a no-brainer, but I think it’s more complicated than that, and there may be unforeseen consequences. The rule is long and complex, and I don’t have the few days it would probably take me to really understand it, but let me play devil’s advocate. Some of the comments posted say that medicine is the only industry that hides the cost. To a certain extent that’s true, but this rule could go beyond just saying the price consumers pay. If you go to a restaurant they won’t reveal how much they paid for the the ingredients. If you book through a 3rd party website, they don’t tell you how much, if any, they pay them for the referral. When you buy a car the dealer usually doesn’t tell you if the automobile manufacturer is giving them a rebate. From the point of view of a business, the consumer shouldn’t get to know their internal costs as that’s secret competitive information.

What mitigates that argument is that the price of healthcare has gotten out of control. Despite being better educated about the matter than most, when it comes to getting healthcare for their own family I suspect most physicians struggle to understand their bills just like everyone else.

When it comes to pay, doctors are a commodity. For a given surgical procedure or office visit of a certain complexity, they are paid the same amount as mandated by Medicare or Medicaid, as negotiated with insurance companies, or their list price for the unfortunate cash patient. Just like any profession, some doctors are better than others. If you want to hire a top lawyer or an A list actor, you have to pay top dollar.  But that’s not so with much of healthcare. The price doesn’t necessarily reflect the quality of the care.

Hospital systems mitigate that somewhat. They can negotiate higher prices with insurance companies and with large employers by demonstrating that they provide higher quality care and/or lower cost care, or because patient perceive them as providing superior care and they demand that that can get care from them. What will happen if the rule goes into affect and patients can easily compare prices? I don’t know, but potentially they might choose the lowest cost without regard to quality. That could lead to systems competing on price, cutting corners to do so, and ultimately lowering quality.

The lowest price might actually not be the path to cost savings. Imagine two surgeons. One of them charges $5,000 for a knee replacement, and operates on 60% of the patients seen for knee arthritis, treating the rest successfully with injections and physical therapy, which on average costs $1,000. The other charges $7,000, and operates on 50% of the patients seen and treats the rest successfully with the same conservative measures. Besides the physician fee, the hospital system charges $10,000 for the surgery. In this example, treating 100 patients would cost $940,000 for the first surgeon, and $900,000 for second. So even though the second surgeon charges 40% more than the first, on average the doctor ends up being cheaper when it comes to managing knee arthritis.

I’m inclined to support more transparency in healthcare pricing, but I don’t know how much of an impact it will have, and there may be unintended consequences.

Don’t expect to see published prices anytime soon. Even if the proposal goes forward, following a public comment period that ends May 3, it’s likely to be tied up in legal challenges for quite a while.

Trying to Destroy Healthcare the Ostrich Way

Copyright: <a href='https://www.123rf.com/profile_andreykuzmin'>andreykuzmin / 123RF Stock Photo</a>Ostriches reportedly stick their heads in a hole if they see something they fear. If they can’t see it, then it must have gone away. President Trump, with most republicans lawmakers going along, is trying that same tactic on the public. Despite 7 years of promises, and multiple attempts, Republicans have been unsuccessful overturning the Affordable Care Act, otherwise know as ObamaCare. So Trump has been doing everything he can to destroy it, with the hopes that it will wither and die, then he can blame Democrats on it’s demise, claiming it was bad legislation. This despite not having a good alternative.

One of the efforts have been to keep people from signing up for coverage for next year. The Trump administration has cut the advertising budget by 90%, shortened the enrollment window, and will close the site on some Sundays for, “maintenance.” They figure that if people can’t see it, they will think it must not be there.

Well sign up just started. If you don’t otherwise have coverage, such as through work, sign up right away, while you still can.  You must sign up by 12/15/17. Don’t wait until the last minute as you might not be able to get on the site. Don’t be scared off by reports of premiums going up. Although true, subsidies also go up per the law, and it costs nothing to find out what it would cost for coverage. Go to healthcare.gov.

Regulators Asleep at the Wheel

Recently the Federal Railroad Administration and Federal Motor Carrier Safety Administration said they would no longer continue pursuing regulations requiring testing for sleep apnea in truck drivers and train engineers.

Sleep apnea is a condition where, in the most common form, the airway is partially blocked during sleep. This leads to daytime sleepiness, increasing the risk of accidents, plus is otherwise hazardous to patient’s health if untreated.  The National Transportation Board determined that a 2013 train derailment that killed 4 and injured 59 was a result of undiagnosed sleep apnea. According to the railroad Metro-North in the New York City suburbs, 11.6% of it’s train engineers have sleep apnea.

Screening involves an overnight sleep test.  We require our pilots to get tests for drug use. Why would we not want to test truck drivers and train engineers for a common problem that is just as dangerous? It’s part of President Donald Trump’s campaign to cut federal regulations. Although some regulations are excessive, this is not one of them. What’s next, repealing seat belt and motorcycle helmet laws?

Politicians Playing Doctor

Recently the British baby Charlie Gard has been in the news. Unfortunately he was born with a rare disorder called Infantile Onset Encephalomyopathic Mitochondrial DNA Depletion Syndrome. The parents of the 11-month-old boy have been in a court battle with the London Hospital caring for him since October. The hospital obtained a court order to remove the boy from life support as the doctors treating him said his condition was terminal and that treatment would just cause the boy additional distress.

The parents have held up hope for an experimental treatment with nucleosides a U.S. doctor has offered, even though he had not examined the patient. In fact no person or animal with Charlie’s condition had ever received the treatment. Reportedly 9 patients with a related disease had some improvement with the treatment.

President Trump weighed in:

Recently Republican House Congressmen Brad Wenstrup (Ohio) and Trent Franks (Arizona) said they would introduce a bill to give Charlie permanent residency in the United States so he can travel for the experimental therapy.

I sympathize with the parents. It’s awful to see your children with serious illness. However sometimes stopping care really is the best thing to do. The US doctor reportedly said a 10% improvement in strength was possible. But that’s the same as saying you can go from lifting 10 lbs to being able to lift 11 lbs. It’s just not going to make a significant difference.

I also believe in research studies. In fact close to 20 years ago I had a patient with a different neurological disorder who could not be removed from a ventilator. I received FDA approval to administer an experimental treatment. It may have helped – they did get off the ventilator, but they died not that much later. That drug had preliminary treatments in animals, then in humans.

If our politicians were really that concerned about the health of an infant in another country, maybe they would accept refugees from countries such as Syria, where innocent people have been in terrible conditions. Their chances of improvement would practically be guaranteed. Unfortunately for Charlie, that’s just not realistic.

Exploring Cuba – Part 2

In my prior post, I discussed a trip I made to Cuba in December. In this second part I will focus on some medical aspects.

When my patients ask about foreign travel where there may be health concerns, I usually direct them to the CDC site. It’s also where I go to check for my own travel, though I look at the more detailed Clinician view.  To start off it recommends typhoid vaccination.  You have a choice of the oral or injected. The oral is a live virus that is taken every other day for 4 doses, starting 12 days before potential exposure. It gives better immunity, but should not be taken by people with a suppressed immune system, such as those on steroids. The injected form is a non-live vaccine, a single injection taken at least 2 weeks before potential exposure. The injected form is harder to find, and even pharmacies that carry it may need to order it in advance. The injection is more expensive, and neither vaccine is usually covered by one’s health insurance. There are other vaccines recommended, but typhoid was the only one I needed.

Cuba has mosquitoes that may carry Dengue Fever, and more recently Zika. I chose to travel in December because it was outside hurricane season, it was the cooler time of the year, and there are less mosquitoes around that time. Cuba does a better job than many other countries controlling mosquitoes, but I was still cautious. Due to the cost, they don’t use insecticides to fumigate buildings, but rather burn oil, as can be seen in the photo above. We checked in to one place not long after they had done their weekly spray, and had to wait 30 minutes for smoke to stop poring out the window! I sprayed much of our clothes with permethrin spray, and applied DEET to exposed skin, especially in the evening when the mosquitoes are more apt to bite.  I texted PLAN to 855-255-5606 to get periodic updates from the CDC about Zika before the trip.

Food is generally safe to eat, but we avoided street food. The tap water is not safe, however. We mostly depended on bottled water and avoided ice except at a few restaurants and bars that filtered their own water. Bottled water is kind of pricey at times. The best deals are on large (3-4 liter bottles) that you can find sometimes in stores. They often cost the same price or less than a one liter bottle that is more readily found. I also brought along a SteriPEN which sterilizes water with ultraviolet light. I didn’t have enough experience to trust it completely to replace buying bottled water, but used it to sterilize water to rinse our toothbrushes, and would have used it if we didn’t have bottled water. I also recommend bringing Imodium, and an antibiotic from your physician for traveler’s diarrhea. I’d also bring some toilet paper. Many public toilets often didn’t have any, or  you’d get a small amount from an attendant after giving a tip.

Bring sunscreen. It’s not easy to find places that sell it in Cuba, and it’s expensive.

Months before my trip I tried to arrange to visit a hospital. It so happened that the fiancée of a Cuban in the travel industry who helped with some of the arrangements was an anesthesiology resident. He told me that he would love to show me his hospital, but that unfortunately the government required a 30-50 dollar payment, despite the fact that I said I would be bringing some medical supplies. He also said I would not be allowed to tour the medical school due to, “national security!” After I arrived we talked a number of times, and ultimately he could not get government approval for me to see his hospital, even though he said everyone at the hospital wanted me to come. He said the only exceptions they made were for those with an educational visa, coming to teach basically, and even then they needed at least 3 months notice.

Although I could not tour the hospital, I had some long conversations with that doctor and learned a lot about their system. All things considered, the Cuban doctors are apparently pretty good, but they are particularly hampered by old equipment and lack of medications and supplies. The anesthesiology resident showed me photos of anesthesia equipment they currently use that are from the 1980’s. He said they don’t have air scrubbers in the operating rooms, so sometimes everyone gets sleepy!  He told me about a colleague of his who was working with a nurse anesthetist. She let her go home early because she wasn’t feeling well. Later she had to intubate a pregnant patient. Unfortunately it didn’t go well and the patient suffered brain damage. During a subsequent investigation the government argued that had she not let the nurse anesthetist go home early, maybe the patient wouldn’t have died because she would have had additional help. She was sentenced to 12-15 years in prison, and even if she gets out after 5-7 years for good behavior, she won’t be allowed to be a doctor anymore! Because physicians are held responsible for a bad outcome, Jehovah’s Witness patients are told they can’t refuse blood if needed, though they do take measures to minimize the need. Doctors are paid poorly (the resident said after he finished he would make 80 CUC (about $80) a month), often less than taxi drivers. It’s very difficult for specialists to be allowed to leave the country, even on vacation, for fear they won’t come back. If they go on medical missions they are paid better than usual, but they only pay them the bare minimum while they are abroad to encourage them to return home after the mission. I was surprised to learn that they are fairly tolerant in terms of LBGT, in part due to Raúl Castro’s daughter, and they even have doctors who do sex reassignment surgery to change gender.

Many Cubans rely on natural formulations, such as herbs, they call ‘green medicine,’ due to cost or personal preference. The anesthesiologist told me that for a man to get a prescription for Viagra (sildenafil) he has to see his primary care doctor, a urologist, and a psychiatrist. Once they get a prescription, though, they are basically assured of getting it indefinitely. He said many patients research their condition and tell their doctors what prescription they want, and they often comply.

One of the most dangerous things in Cuba are the cars. They are famed for their old cars, many of which look fabulous, but they lack safety features, such as seat belts and airbags. In fact we were in a car accident. We hired a car and driver for 6 days through a contact in the travel industry in Havana. He was probably around 60-years-old, and reportedly one of their best drivers. He was very nice, funny, and knowledgeable, and arrived to pick us up in a pretty new Chinese car, a BYD (Build Your Dream). On the first day as we were driving, while my wife and daughter were sleeping in the back, the car started drifting to the left. I grabbed the steering wheel, noting the driver had fallen asleep. He quickly awakened, pulled the car to the side of the road, and got out to stretch. He came back in and apologized, saying he had gotten up early to pick the car up. The next day he said that actually he hadn’t slept well because he had witnessed a teenager, who was not paying attention listening to music, hit by a car the day before.

In the middle of the car trip I met with the doctor I mentioned above and told him about the incident. I wondered if he might have sleep apnea, though the driver had said he had never had such a problem.  He said that they don’t test for sleep apnea because they don’t have CPAP machines to treat it.

The rest of the road trip went fine until the final day. Once again my wife and daughter were sleeping in the backseat when the driver fell asleep again. This time he swerved too quickly for me to reach the wheel. We hit a guard rail, damaging the front end and side mirror and puncturing two tires. The driver said he did not know why he fell asleep and that he had been well rested. One theory I came up with is the possibility of carbon monoxide poisoning from a leak in the exhaust system. Our driver obtained another car and driver for us, who brought us back to Havana.

No one was serious injured, but my wife was seated behind the driver and her left elbow hurt immediately afterward. Back in Havana we went to a clinic that caters to foreign visitors. X-rays showed no fracture.  She was given a skinny piece of gauze to use for an arm sling (she had been using my belt up until that point). When it came time to leave they said we owed 100 CUC (about $100).

Boarding Pass

 

Cuba requires one to have medical insurance to visit the country, and they add $25 to the price of each airline ticket to cover it. Delta Airlines said to show the boarding pass if needed as proof of insurance. I showed the boarding pass, but they said it wasn’t good because it said AeroMexico on the top. I pointed out that below that is said that it was operated by Delta Airlines. They said they would have to investigate it. They gave no indication how long it would take, and given that it was the evening I didn’t think they would get an answer that night. I eventually gave up, paying the money so we could get her passport back and leave. I wrote Delta Airlines and explained the situation, sending them copies of the boarding pass and the medical bill. We were on something like their 4th commercial flight to Cuba, so I figured they would be eager to work out any glitches. I was wrong. Besides some email exchanges, they called twice at 7 am. When I pointed out the early hour I was told it was 10 am on the East coast. You would think an international airlines understood the concept of time zones! In any case, ultimately I was told we, “..must request a refund of the insurance premium directly with the Cuban insurance provider.” Really? They expect their customers to request a refund from the Cuban government?! All I was asking for was the approximately $100 I paid for the clinic. Not the taxi ride there and back, the medical costs after we got home, to say nothing of pain and suffering. Imagine someone of lesser means ended up needing much more care and being told the insurance they thought covered them didn’t. That might keep people from choosing to visit Cuba, at least on Delta Airlines.

Presidential Politics and Influenza Vaccinations

Recently a patient of mine expressed frustration with the presidential campaign, saying the other side wouldn’t listen to facts and just believed what they wanted to believe.

Knowing that she had repeatedly refused to get a flu shot, I asked her in that case if she’d like to get one, given that scientific studies have shown that the benefit outweighs the risk for most people. Although she hesitated, I unfortunately could not convince her.

Trump the Bureaucracy

About 6 weeks ago I referred a patient of mine with a knee problem to an orthopedic surgeon in my group. He ended up seeing someone else in the same group about 3 1/2 weeks later, and the doctor prescribed a knee brace.

A few days ago my patient said his insurance company wanted me to do a new referral, because I had referred him to a different physician than the one he ended up seeing. Even worse, he still did not have the brace because they required his primary care physician (that’s me) to write them a letter saying the brace was necessary.

I did write a letter saying that I’m not qualified to say whether or not the brace is necessary, and that if they wouldn’t approve it, then their medical director should contact the orthopedic surgeon to explain why not.

Physicians have far better things to do with their time than waste it on unnecessary paperwork. If we could only channel our collective anger and frustration with the system, as Donald Trump has been doing in the realm of politics, maybe we could spend more of our time treating patients, rather than placating the government and insurance companies.

Medicare Payment Formula Finally Changed – Win or Loss?

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Congress passed a  law in 1977 linking Medicare payments for physician services to growth in the economy.  Because it failed to take into account inflation and other factors, Congress has had to act 17 times to prevents cuts to physician pay under the sustainable growth rate (SGR) formula. This year physicians were set to get a 21% pay cut this year. This created a lot of stress and uncertainty for physicians, and caused some physicians to stop accepting Medicare patients.

The Senate recently voted to repeal this formula, 92 to 8. The bill was already approved by the House, and now President Obama has signed the bill.

That sounds like a great triumph for physicians. Although this may prompt some to pull out their imaginary violins in mock sympathy, I’m not so sure it will turn out to be such a great deal for physicians, which actually only consumes 12% of the Medicare budget.

The bill freezes the current rates, then increases them 0.5% a year from 2016 to 2019. For 2020 through 2025 there is no increase, and from 2026 onwards it increases by 0.75% per year. That is far below the current rate of inflation, and there is no provision if inflation gets worse than the currently low rate. That effectively means a real loss every year into the indefinite future.

There is a provision to transition payments to reward physicians for quality, rather than quantity. That is good in theory, but we’ll have to see how that works out in practice. Quality healthcare is very difficult to measure, and there is a risk that quality will be defined based on what’s easy to measure, and that will lead to physicians and other healthcare providers to concentrate on what they are rewarded to do, and not what may be in patients’ best interest. I hope I’m wrong.

How to Get Rich – A Guide for Pharmaceutical Companies

The Changling Ming Dynasty Tomb of the Yongle Emperor
The Changling Ming Dynasty Tomb of the Yongle Emperor – copyright 2012 Daniel Ginsberg Photography

Thanks to Congress, Medicare is not allowed to negotiate for the cost of medications. The bill was shepherded through by congressman Tauzin, the chairman of the House Energy and Commerce Committee that regulates the industry, who subsequently stepped down then took a job as the President and CEO of the Pharmaceutical Research and Manufacturers of America. This is a lobbyist group for pharmaceutical companies.

Here’s a suggestion to pharmaceutical companies; the next time you come out with a new first in class medication, for which there are no other medications that can be substituted, price it at 10 billion dollars a month. After the first prescription gets filled, it may move Congress to act, but by then you will be set and it won’t matter if you don’t sell another pill.

Quitting Smoking and Happiness

The FDA is proposing a new rule in regards to tobacco regulation. As detailed recently in the New York Times, the benefits of stopping smoking, such as less heart and lung disease, would need to be discounted 70%, making it that much harder to justify spending money on smoking cessation. It sounds like something inserted at the bequest of tobacco lobbyists. Tomorrow is the deadline to make a public comment. Here is what I submitted:

I think it’s a dire mistake to discount the economic and health benefits of stopping smoking because of the loss of enjoyment. Although smokers may get temporary enjoyment from smoking, they also get enjoyment from being healthy. Surely one gets more pleasure taking a walk in a park and living at home, than pushing an oxygen tank down a hall in a nursing home because of severe emphysema. Smokers die at a younger age than they otherwise would. What about the enjoyment their partners, children, and grandchildren lose when the smoker dies prematurely? Loss of enjoyment should not be part of the equation, unless it’s a negative number which would serve to magnify the cost smoking places on individuals and society.

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