Monday, August 3, 2009

The Health Care Debate: the Best and Worst of Our Political Culture

We see unfolding before us the present day political process, trying on the one hand to better our society while at the same time paying off multiple parties to make it happen. The paying off does not stop at the federal trough; it also involves huge amounts of monies paid to various legislator’s campaign funds to secure a favorable outcome for those special interests.

First the good:
1)Many decent hard working people are without health insurance which if illness strikes causes extreme financial and emotional hardship along with delays in obtaining care. Any thoughtful society would want to rectify this situation.

2)We as a nation spend much more per person for health care ($7,000 for every woman, man and child) than any other country yet have multiple millions uninsured with comparatively poor outcomes. Additionally our excessive share of gross domestic product devoted to health care (presently 17%) compared to other nations has caused us to loose global market share causing the loss of high paying manufacturing jobs along with decreased take home pay. There is no doubt that our high health care costs must be addressed.

Now a few examples of the bad:
1)The organized medical community, instead of taking any responsibility for the way physicians practice today with excessive reliance on technology while de-emphasizing history taking, physical diagnostic skills and integrative thinking, support health care reform as long as across the board physician payments are not curtailed. As of now, to decrease Medicare costs every year Congress threatens to make across the board decreases in doctor reimbursement. Every year the medical establishment lobbies against these cuts and in the eleventh hour they are postponed to the following year. Now to gain medical society endorsement the administration has proposed to eliminate this yearly struggle and not decrease doctor reimbursement with the result being medical society support for passage of health care reform. Instead these societies should be offering to seek a mechanism to decrease/eliminate non-beneficial care (now totaling about $700 billion/year) and maintain reimbursement for appropriate care. The idea is that people are not widgets and need evidence based care individualized for every situation. Tailoring the right care for every person should be the mantra for physician societies.

2)We are witnessing a Congressional lobbying bonanza. The New York Times (August 2, 2009) reported that the pharmaceutical industry alone has recently spent $68 million lobbying Congress. Key legislators are having massive contributions to their re-election campaign funds. There are estimates that over 300 lobbyists are at work costing various stake-holders millions per day.

We need oversight in our medical system, not by third party payers, not by accountants, not by government, but by senior medical personnel reviewing cases, resolving conflicts and insulating physicians from the threat of legal action.

We need medical system reform that will immediately decrease costs by eliminating non-beneficial care while providing the framework for delivering excellent care at a reasonable cost regardless of how physicians are reimbursed. We need health care reform that serves our nation and not designed to serve those who lobby the most.


AJ Lester said...

Dr. Fischer, I applaud your efforts and would like your thoughts on one solution that's been entirely overlooked amidst the healthcare reform debate: Employers eliminating the managed care middleman and contracting directly with doctors and hospitals.

For the past 15 years, I've been working with major self-insured employers, negotiating direct agreements between those employers and medical providers as an alternative to conventional PPO networks. One of my largest clients, a company with over 50,000 covered lives, was with Cigna when they opted to develop their own direct networks instead of using Cigna's PPO networks.

With direct networks now across 14 states, my client's medical trend has been essentially flat for the past 8 years, while companies their size suffered increases of 10% or more each and every year. This company's employer-owned networks, built upon fair "win-win" agreements, are stable and well-liked by providers. Compare that to the openly contentious and adversarial relationships you and I know exist in virtually every commercial PPO network.

The huge savings this particular employer has achieved by having its own direct networks for the past 8 years has allowed it to maintain a relatively rich medical benefits plan, with low deductibles and without shifting costs onto employees.

Incidentally, this employer uses a third party administrator (TPA) to process its claims according to the reimbursement and contractual terms of the direct agreements, as well as the UR, pre-cert, and case-management components. In this case, the TPA works for the client, and has no middleman loss-ratio to protect, so the admin costs are a fraction of what they run with Cigna or any other carrier.

I invite you to peruse the articles about the success of this approach that appeared in the WSJ, Business Insurance, Employee Benefits Review, and the Kiplinger Letter. Many of these are available at my website,, in the Resource Center-Newsroom.

For years, managed care companies have disdained my efforts to help employers bypass PPO networks by contracting directly with providers. Unfortunately, they've done such a bullet-proof job as middlemen, that most doctors and employers believe there is no other way for them to do business with each other than through a managed care company.

Ironically, the very first people that my prospective clients consult with about the idea of direct contracting guessed it, their insurance company. You can imagine how quickly employers are talked out of that idea.

What are your thoughts about employers cutting out the middleman and contracting directly with doctors and hospitals? Shouldn't it be promoted as an alternative to commercial PPO networks? It's still a "private-payer" approach, which should appease opponents of the "public option". But the private part of it really is private. That is, between the employer as buyer and the medical provider as seller, without need of a middleman.

Lastly, is anyone else you know talking about this approach? If not, why not? If it's because no one thinks it'll work, where is that message coming from? There are companies out there, albeit not a huge number, who can tell a compelling story about the success of this approach. Is it possible to get people to listen?

Incidentally, I've enjoyed very close relationship with physicians over the years, nearly every doctor supporting the idea of cutting out the managed care middleman. The overall success of this approach has been irrefutably proven over the years by the virtually non-existent attrition rate among directly contracted network physicians. Goes to show, if the contract terms and reimbursements are fair to begin with, and if the business relationship really does benefit both parties, there's no reason to ever drop out of the network. Compare that to what's going on with commercial managed care networks!

Many thanks in advance for whatever insights you can lend.

Kenneth A. Fisher, M.D. said...

Mr. Lester,
Thank you for taking the time to write an excellent response to my post. I applaud your efforts. Kenneth A. Fisher, M.D.

Carla said...

The nationwide debate over health care reform touches on many issues, from affordability to access. But one crucial element has been largely missing from the discussion: prevention. That is, how to help Americans stay or become healthy. the need is to take an in-depth look at the type of health care system that we really want in this country and at how our individual lifestyle choices impact our health.

sherry said...

Why are mid level practitioners not discussed concerning the health care crisis? We provide care equal to MD's in primary care and less cost. We are part of the solution. The talk of less students entering medical school because of not making enough money is really a shame. I have been in health care since 1979 and do believe that physicians are over paid and that we can fill there shoes. If they are all about the money, go into specialities. More effort needs put into training more NP's and PA. Sherry