Pricing Transparency Gaining Interest

Insuring Resources Commentary:
With some bipartisan support on these pending bills it'd be great to see something happen on transparency. See the article below.

Also, Rep. Steve Kagen (Appleton) is the author of one of the bills. Appleton happens to be the home of ThedaCare - a leader in lean strategies and health care transparency. (www.createhealthcarevalue.org)

As Rep. Barton states below, the PPACA does fall short of the implementing the transparency we need going forward. This is a great companion bill in that regard to get the amount of transparency America needs to truly provide physicians and hospitals the cost incentives we need.


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Pricing transparency gaining renewed interest
By Matthew DoBias of Modern Physician Magazine
Posted: May 24, 2010

Led by a physician lawmaker, members of Congress on both sides of the aisle have shown renewed interest in mandating a boost in healthcare pricing transparency, including charges for physician services.

But one key player, the chairman of the Energy and Commerce Committee's Health Subcommittee, Rep. Frank Pallone (D-N.J.), is skeptical that three bills that came before that committee this month will make it into law this year given Congress' calendar is backlogged as a result of the lengthy healthcare reform fight.

One bill, introduced by physician Rep. Steve Kagen, M.D., (D-Wis.), would require doctors, hospitals, nurses, pharmacies and a number of manufacturers and vendors to openly disclose prices. Failure to do so would result in a financial penalty. Kagen says the current system is “upside down,” adding that it allows for those with no insurance to be charged the full amount while it gives the insured steep discounts.

“Some will argue that showing everyone all of the prices is too complex, for there are tens of thousands of prices at any given hospitals,” Kagen says. “But today's technology allows all of us to go online on the Internet and search for items to purchase and find exactly what we want to buy within milliseconds.”

Another bill, sponsored by Rep. Joe Barton (R-Texas) but backed by several Democrats, requires public and private health plans to make known what services they cover, any restrictions in that coverage and the cost-sharing requirements that are also involved. Two years out, it would require hospitals and ambulatory surgical centers to publicly disclose the charges for services they typically perform. A third bill requires a higher level of Medicaid transparency.

Taken together, the bills attempt to give individuals the important information they need to choose where to go for care and how much they can expect to pay once they get there.

Barton acknowledges that the new reform law contains provisions that would inch toward a more transparent system, but he says they fall short.
Under the law, hospitals during the next six months are required to disclose annually a list of their standard charges for items and services, including Medicare DRGs.

Critics contend, however, that “standard” charges are too vague. Steven Summer, president and CEO of the Colorado Hospital Association, says the healthcare system in its current form makes it difficult to post accurate and meaningful pricing information.

“We firmly believe that everyone needs to have access to consumer-friendly pricing language,” Summer told the congressional subcommittee.

Colorado hospitals annually publish some financial data, which compares charges vs. the average length of stay for common medical treatments and surgical procedures.

While many lawmakers agree that price transparency is needed, political realities could squelch any momentum the bills may have. Democratic leaders in the House have deliberately planned a lighter workload heading into the November elections.

“Members have been asking to have hearings and move on legislation for a long time, so I'm more concerned at this point about having hearings and moving legislation that has been held up,” Pallone says. “And that's what I'm getting from members.”

Fascinating Proposal: Creation of a new field- Health Care Delivery Science

Insuring Resources Commentary:

For long-term readers of this blog you'll recognize this article as hitting on my number one issue, health care quality and cost incentives to reduce waste in our fractured health care delivery system.

It is my firm belief that insurance reform cannot succeed without quality and cost reduction health care provider incentives to eliminate waste and focus on improved, quality health outcomes for all Americans.

This proposal, I believe, holds tremendous promise in reshaping the delivery and financing of American health care to finally focus on quality, rather than quantity.

I'll keep you updated as the Center for Health Care Delivery Science is launched.


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By Jim Yong Kim and James N. Weinstein
Guest Editorial in the Washington Post
Monday, May 17, 2010

Health insurance reform is now law, giving millions of Americans access to the full resources of our health-care system for the first time. The question becomes: How can we ensure that they -- and all of us -- receive value-based and high-quality care?

It is well known that U.S. health-care costs, as a share of our economy, are the highest in the world but that compared to other industrialized countries, our results are the worst. The Dartmouth Atlas has documented the enormous waste in our system and shown that spending more money and performing more medical procedures do not equal better outcomes for patients.

Americans deserve health care that is coordinated across physicians and health systems, and that is effective, appropriate and safe. As a nation, we have a moral and a fiscal responsibility to ensure that all patients receive value for health services. While the achievement of health insurance reform was historic, it is time to focus on the next step: improving quality while bending the unsustainable cost curve significantly.

We are physicians and researchers; one of us is now a college president, and the other head of a leading academic medical center. We share a history of work in medicine, science, policy reform and education. We also share the view that throughout history, our most difficult problems have found scientific solutions.

We propose the rapid expansion of a new field to tackle the twin problems of how to provide high-quality health care while lowering costs: health-care delivery science.

This new field will work with the recognition that truly reforming health care requires more than the efforts of one entity. We cannot blame government or insurers or physicians for the complex and multilayered problem. No single group or entity created the puzzle that is our health-care system; it is not reasonable to expect one group to solve it.

What will lead to improvements is a multidisciplinary approach that brings the best minds to focus on the problem. Experts in management, systems thinking and engineering, sociology, anthropology, environmental science, economics, medicine, health policy and other fields must join together to apply a laser focus to fixing the delivery system.

Why? Consider the moving pieces of a patient-health system encounter. A patient comes into the emergency room. Immediately, judgments are made about how sick she is and what treatments she needs. There is no universal medical record for that patient, so the provider has no idea about her medical history, medication use or preexisting conditions. Incomplete information is relayed through layers of nurses, physicians, specialists and the shifts of personnel who replace them. In the absence of real-time information, tests are ordered and treatment decisions made. Perhaps after an overnight stay, barring complications from drug interactions or perhaps an unrecognized underlying condition, she is discharged, with no further transfer of information to a provider and, more important, no follow-up to see whether the treatment was effective. The symptoms were treated; the patient was not.

The best insurance in the world will not fix this problem. We need a whole new cadre of people committed to applying their expertise to the challenge of health-care delivery.

We have begun building that cadre at Dartmouth with the establishment of a Center for Health Care Delivery Science. But it is our hope that many more institutions will work together to generate the needed evidence on health-care delivery solutions, to disseminate that knowledge and to train the current and future professionals who will put solutions into practice. We envision a network of centers across the country that will marry research and implementation from the start -- finding and testing delivery solutions with practitioners and patients on the front lines.

The recent health legislation establishes an implicit covenant with the American people. The spirit of this covenant goes far beyond insurance. In exchange for new public and private investment in the health system, Americans expect access to effective, high-quality care within a financially sustainable system. With a robust science of health-care delivery, this goal can be achieved.

Jim Yong Kim is president of Dartmouth College. James N. Weinstein is president of the Dartmouth-Hitchcock Clinic.

Dartmouth gets grant to demo increasing health quality, reduce costs

Insuring Resources Commentary:

Dartmouth will demonstrate to others how its done. The only problem is Dartmouth already has the track record and the evidence to begin wider implementation. Now they have to essentially do what they've already been doing for years instead of just simply mentoring others how to do it. Here's the evidence:

http://www.rwjf.org/qualityequality/challenge.jsp

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$35M For Dartmouth Health Care Delivery Center AP by HOLLY RAMER



Dartmouth College is getting $35 million to open a center it hopes will help the nation take the next big steps in health care reform: improving quality while lowering costs. The historic health care overhaul legislation President Barack Obama signed in March will give millions of Americans access to health care, but "the real rocket science in health care right now is in the delivery," said Dartmouth President Jim Yong Kim, who has been promoting the idea of a national institute on health care delivery since arriving at Dartmouth last July. Now, he has a $35 million commitment from an anonymous donor to establish the Dartmouth Center for Health Care Delivery Science, which will bring together experts in everything from medicine and management to sociology and systems engineering to figure out what is working in successful health care systems such as Minnesota's Mayo Clinic. They'll then teach practitioners, who can return home and make changes immediately, Kim said.

Important Health Care Payment Reform Session

Insuring Resources Important Link:

I want to draw your attention to an important event that took place last week, on April 6th. Health care leaders from across the state met to discuss methods to improve health care payment methods to better reward health care quality and efficiency.

Please check this out:

http://www.createhealthcarevalue.com/blog/post/?bid=160

Here's an excerpt: "The Center has outlined what we think real health reform looks like. It boils down to three things: paying for value not volume, transparency of healthcare performance through public reporting, and redesigning the care delivery process to take out waste. We took a step closer to paying for value with the day long meeting in Pewaukee on (April 6th)." - Dr. Toussaint

Wisconsin Physicians Weigh in on the PPACA

Insuring Resources Commentary:
So what do Wisconsin physicians think of the newly enacted health insurance reform law of the land- the Patient Protection Affordable Care Act (PPACA)? Well, for the most part they like it, but they too, would like to see more emphasis on quality and efficiency. That speaks volumes doesn't it? Please see the statement below from the Wisconsin Medical Society.

I hope readers don't see this is as self-serving when I post opinions that agree with my take on this legislation. If you look back at the beginning of this blog in August 2009 you'll see that I have been a consistent advocate for payment reform and for Wisconsin's quality and efficient care.

As I've noted all along Wisconsin is in a pretty good place overall when it comes to our health care and health insurance systems.

1) We have numerous health plans that focus on quality and efficiency that are seen as national models.

2) We have a very low number of uninsured persons due to Wisconsin's BadgerCare program which provides greater Medicaid access to low-income individuals than the PPACA.

3) We have perhaps the strongest set of proactive insurance regulations in the nation.

4) We possess additional safety net programs like our Health Insurance Risk Sharing Program (www.hirsp.org) and Medicaid Purchase Plan (http://dhs.wi.gov/medicaid/Publications/p-10071.pdf) that together cover more than 30,000 Wisconsinites.


Wisconsin is a national model for how reform should be done. Its a pity our Congressional leaders couldn't expand Wisconsin's models nationwide.



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Reaction to health care reform legislation mixed
Madison (March 22, 2010)—“Members of the Wisconsin Medical Society have advocated for access to high quality health care for all patients in Wisconsin since the organization’s inception in 1841. Yesterday’s passage of health system reform (Patient Protection Affordable Care Act) by the U.S. House of Representatives extends coverage to millions of Americans who are currently uninsured, eliminates both lifetime caps on coverage and insurers’ ability to deny coverage for children because of pre-existing conditions. These are definitely steps in the right direction.

“At the same time, many issues remain unresolved, such as national lawsuit reform and the permanent fix of Medicare’s flawed payment formula, which penalizes cost-efficient states such as Wisconsin and threatens access to care for our seniors.

“Wisconsin physicians have been recognized nationally for providing the highest quality care at a low cost, and we support payment efforts such as those championed by Rep. Ron Kind that focus on value, not volume. Because Wisconsin’s health care safety net is already severely stressed, we are concerned about how this legislation and the subsequent reconciliation bill will impact the delivery of care in our state.”

Statement attributable to Robert Jaeger, MD, President, Wisconsin Medical Society.

Health care costs out of control - a cartoon

Insuring Resources Commentary:
I like to post viepoints from others, particularly when they agree with mine.

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Health care ambulance is out of (cost) control

From The Capital Times, Madison WI
Cartoon and opnion by Phil Hands
Wednesday, March 24, 2010 10:33 pm |

I don’t usually draw cartoons on national issues, but I thought this cartoon did a pretty good job of summing up my feelings on our new health care bill.

Don't get me wrong, I'm glad the Democrats passed a health care reform bill.

It's good that insurance company's can no longer cry "pre-existing condition” and drop paying customers as soon as they get sick. I'm glad kids won't be denied insurance on the basis of pre-existing conditions anymore, and it's good that millions more Americans will have access to health insurance.

But for as massive as this bill is, there is very little in it that will actually make health care cost less and that is the crisis we are facing. Health care is too darn expensive, whether or not you have insurance to pay for it.

This bill needed to include serious tort reform and incentives to end the obscene practice of paying doctors by the amount of tests they order and not by the health of their patients. If you could somehow add provisions like these the bill, it would have been a lot better.

President's statement moving forward with health care reform

Insuring Resources Commentary:


It will be interesting to see if the measure includes the cost control measures on health CARE that I have promoted since the beginning. When I started this post I realized that it is the 99th post I have entered on this blog. When I started this in August I did not envision posting 99 items. I certainly did not envision this process lasting until March. There are several items I disagree with in the Senate bill, including the Cornhusker Kickback and some others. I belive there should be a stronger employer mandate. I believe the abortion language should be tougher.

But the most egregious error by far is the omission of a game changer on the way health care is financed. This is a BI-PARTISAN issue as Republicans have been shouting about this from the beggining. Obama started the whole process during his campaign talking about this but now barely utters a word on it. If this had been the center piece of health care reform I believe strongly that we would have had a bi-partisan bill passed before The end of 2009.

We must have a health care reform bill that includes, at the very least, efficiency and quality provider incentives across all payment sources- Medicare, Medicaid and the private health plans. I realize implementing this takes time but we could do it incrementally like the incentives in place right now for electronic medical records that were passed in the ARRA last February.

We should change health care financing to an EPISODE of CARE reimbursement, rather than fee-for-service. This change would create higher quality and efficiency of care. We could easily implement these changes in Medicare by 2014 and the whole system by 2017 and manintain the private health market like the Republicans want. We wouldn't need a public plan option if we followed the above prescription.
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President Obama 3/6/10:
“This week, I asked Congress to schedule a final vote on reform that will give families and businesses more control over their health care by holding insurance companies more accountable. This comes after nearly a year of debate, as well as a seven hour summit with Democrats and Republicans where we had a public and substantive discussion on health care. Since then, I’ve said that I’m willing to incorporate some ideas offered by Republicans, and we’re eliminating special provisions that had no place in health care reform.

Now, despite all the progress and improvements we’ve made, Republicans in Congress insist that the only acceptable course on health care is to start over. But you know what? The insurance companies aren’t starting over."

How to Fix the Cost Issue.... while increasing quality

Insuring Resources Commentary--

Yesterday at the Wisconsin State Capitol a leading expert on cost and quality issues in ehalth care gave a presentation to state lawmakers and others.

Here are some of the details:


Dartmouth Atlas Author Sees ACOs as Solution to Cost, Quality Concerns

Elliott Fisher, MD, Professor of Medicine at Dartmouth Medical School, presented his ideas on how Accountable Care Organizations (ACOs) could be promoted and implemented as a way to improve population health and lower costs. Fisher presented to a group of health care professionals and policymakers on February 25 in the State Capitol at a forum sponsored by the Evidence Based Health Policy Project. Fisher was a principal author of the Dartmouth Atlas that highlighted wide variations in national Medicare spending and utilization. The Atlas showed Wisconsin as having among the nation’s lowest Medicare costs, mainly due to more efficient provision of care.

The ACO model envisions provider organizations that can effectively manage the full continuum of care as real or virtually-integrated local delivery systems. This structure would be joined with targeted spending levels and health care performance measures to help achieve lower costs and better outcomes, with the providers sharing in any savings.

Fisher said while the ACO model is relatively new, it has shown promise in a number of settings. "Aligning financial and professional incentives, together with having better information that engages physicians and consumers, will enhance their ability to improve health and lower costs." He added that those areas of the country that have ACOs in place tend to have shared aims, physician engagement, use of data to drive change, and communities that are energized to make it happen.

Fisher recommends that policymakers promote the proliferation of the ACO model by legislation (as in enacting Medicare ACOs) or by easing regulatory barriers that complicate the formation of ACOs.

Health Care Reform Summit Feb 25th

Insuring Resurces Commentary:

This summit creates a next step for health-care reform. The House and the Senate have not been able to agree on a path forward. The president is bringing the two houses together, but not starting over. The basis for the discussion will be the two bills that have already passed, but the discussion is aimed at leading a way forward which means there may be some alterations in hopes of getting a few Republican votes.

The President, I presume will also use the occasion to change the perception on the back room Senate deals for multiple conservative Democratic Senators. But by setting this summit, he's bought them a few weeks to figure out how to hold a vote themselves. That won't be easy, but it'll be easier with the White House summit giving some structure and narrative to an effort that had collapsed into murky chaos.

Hopefully a way forward will highlight cost efficiency and quality which the GOP has been touting. Now's the time to play that card in front of a television audience.

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From the Wall Street Journal- 2/8/10
President Barack Obama, seeking to give new momentum to his languishing health-care legislation, said he would sit down with Republican and Democratic lawmakers to exchange ideas on an issue that has deeply divided the parties.

With the GOP united against the Democratic bill, Mr. Obama said Sunday he would ask Republicans "to put their ideas on the table." The half-day meeting will be Feb. 25 and broadcast live, the White House said.

"I want to come back and have a large meeting, Republicans and Democrats, to go through systematically all the best ideas that are out there and move it forward," the president told CBS in an interview broadcast Sunday.

Wisconsin Group Leads The Way on Efficiency Data

Insuring Resources Commentary:

This is how Wisconsin can lead the way to show how efficient health care can be delivered. Health care reform must include incentives to providers to share their costs and quality outcomes to drive competition to more cost effective and quality care.

The WHIO Health Analytics Exchange announced today the launch of a database to assess health care quality, costs.

For more information visit WHIP at http://www.wisconsinhealthinfo.org/


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from the Milwaukee Journal Sentinel
Nov. 16, 2009 3:10 p.m. |
A 4-year-old collaborative effort to collect data from Wisconsin's insurers, hospitals, major employers and others has launched a database that can be used to analyze health systems' performance.

The WHIO Health Analytics Exchange contains information from millions of insurance claims and is being used by large medical groups, state government, business groups and other members of the Wisconsin Health Information Organization, said Julie Bartels, the organization's executive director.

The database shows, for example, that treatment for congestive heart failure in the Fox Valley and Madison costs significantly less than the statewide average, meaning those areas are much more efficient at caring for that disease, Bartels said.

Treatment for congestive heart failure costs slightly more in the Milwaukee area than the statewide average, the data show.

"The breadth of information in our repository is astounding," said Bartels, who will discuss Wisconsin's experience building the database Tuesday at an American Health Insurance Plans conference in Chicago.

"To us, the real opportunity is to look across all the claims aggregated here and get a picture of where we have cost-effective health care being delivered in Wisconsin, and where we have an opportunity to improve the cost-effectiveness of health care," said Karen Timberlake, secretary of the state Department of Health Services and a WHIO board member.

It's difficult to see trends when comparing a few heart attack treatments. But when you can look at thousands of procedures around the state, "it's really powerful," Timberlake said. "You start to see there are real differences in the way medicine is practiced."

That kind of information will help medical providers improve their care, said John Toussaint, president and chief executive of the ThedaCare Center for Healthcare Value in Appleton. If a provider discovers it is expensive or less efficient in a certain area, it "can either say, 'I'm going to put resources into this, or maybe not do it anymore,' " Toussaint said.

Ten founding members contributed $3 million to WHIO to develop the database, and six more fee-paying members have joined. The state contributed $1.55 million.

WHIO has given a three-year, $4.5 million contract to Ingenix, a health care information and research company, to manage the data warehouse and analyze the information. Ingenix is part of UnitedHealth Group Inc.

"We all know there is waste going on in health care, and it contributes to higher health care premiums," Timberlake said. "This is one way we in Wisconsin can work to hold down the cost."

Business Roundtable Wants Increased Emphasis on Cost-Effectiveness

This is an important article from the business/ employer perspective


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By Donna Smith (Reuters)

WASHINGTON (Reuters) - An influential business group said on Thursday that its continued support for President Obama's healthcare overhaul hinges on whether it slows the soaring growth rate of healthcare costs.

The Business Roundtable, which represents some of the largest employers in the United States, released a report saying that "effective" healthcare reforms could save employers as much as $3,000 per worker by 2019.

"The report also shows that reform done wrong ... could make a bad situation much worse, in which case Business Roundtable could not support the bill," Eastman Kodak (EK.N) Company Chairman and Chief Executive Antonio Perez said in a statement accompanying the release of the report.

Obama said it was further evidence that the U.S. healthcare system is broken.

"If we don't pass comprehensive reform, the report finds, health care costs that are already squeezing our businesses will continue to rise, and in 10 years, employment-based spending on health care for large employers will be fully 166 percent higher per employee than it is today," the president said in a statement.

"The yearly health insurance costs for the average employee will rise to a staggering $28,530," he added, citing a finding by the report.

Companies represented by the Business Roundtable, which includes such giants as Verizon Communications Inc. (VZ.N), The Boeing Company (BA.N) and Exxon Mobil Corp. (XOM.N), provide health insurance to more than 35 million workers and their families. The group has been a major force behind the healthcare overhaul push.

The business group opposes the bill approved last week by the U.S. House of Representatives. It says the measure fails to control costs and that some provisions, including one that would create a new government insurance plan, could undermine employer-sponsored health coverage.

The report, written by Hewitt Associates for the Business Roundtable, favors some of the cost-containment reforms included in legislation passed by the Senate Finance Committee.

These include changes in the government Medicare health insurance program for the elderly that would reward quality of care and not the quantity of services and treatments performed.

The report said a strong requirement that individuals be responsible for obtaining health insurance would help ensure that premiums do not jump with a proposal that would bar insurers from rejecting people with pre-existing conditions.

The Finance Committee weakened enforcement measures of the individual mandate provision, raising concerns that healthier people will delay seeking insurance, increasing the costs for those who buy insurance.

Cost Control Measures Gain Some Traction

Insuring Resources Commentary

Finally, we may be getting somewhere. I've highlighted the primary issues in bold within the NY Times article below. It looks like the cost hawks in Congress and experts like myself are finally getting some to listen to the message. The current bills do not go far enough in reducing health care costs. We may yet get there.

Even in this article there is too much emphasis on cost controls in Medicare like the draft language authored by Dr. Cortese of Mayo. That doesn't go far enough. We need them nationwide through every payor method-- public and private.

It's time to call your Senator and drive this point home.
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Democrats Raise Alarms Over Health Bill Costs

By SHERYL GAY STOLBERG-- New York Times
Published: November 9, 2009

WASHINGTON — As health care legislation moves toward a crucial airing in the Senate, the White House is facing a growing revolt from some Democrats and analysts who say the bills Congress is considering do not fulfill President Obama’s promise to slow the runaway rise in health care spending.

Mr. Obama has made cost containment a centerpiece of his health reform agenda, and in May he stood up at the White House with industry groups who pledged voluntary efforts to trim the growth of health care spending by 1.5 percent, or $2 trillion, over the next decade.

But health economists say it is impossible to know whether the bills, including one passed by the House on Saturday night, would meet that goal, and many are skeptical that they even come close.

Experts — including some who have consulted closely with the White House, like Dr. Denis A. Cortese, chief executive of the Mayo Clinic — say the measures take only baby steps toward revamping the current fee-for-service system, which drives up costs by paying health providers for each visit or procedure performed. Some senators are also dissatisfied.

“My assessment at this point,” said Senator Ron Wyden, Democrat of Oregon and a member of the Finance Committee, “is that the legislation is heavy on health and light on reform.”

There are a variety of ideas for attacking cost increases more aggressively, including setting Medicare reimbursement rates for doctors and hospitals more rigorously and discouraging workers and employers from buying expensive health insurance policies that mask the true costs of treatment.

Among other innovations being considered is a cost-cutting method known as bundling, in which health providers receive a lump sum to care for a patient with a particular medical condition, say, diabetes or heart disease. The House bill calls for the administration to develop a plan for bundling, while the Senate Finance Committee version of the bill gives it until 2013 to create a pilot program.

Some experts would like to see such changes adopted more quickly, and senators of both parties say they will press for more aggressive cost-cutting measures when the bill comes up for debate. But drastic changes in the health care reimbursement system could cost the White House the support of doctors and hospital groups, who have signed onto the legislation and are lobbying hard to keep the current fee-for-service system from being phased out too quickly.

The debate underscores a fundamental tension inside the White House between cost-containment idealists and pragmatists.

The first group includes officials like Peter R. Orszag, the budget director, and Dr. Ezekiel J. Emanuel, the medical ethicist whose brother Rahm is the chief of staff. The second includes Rahm Emanuel and Nancy-Ann DeParle, the director of the Office of Health Reform, who must contend with the realities of getting legislation passed.

“Let’s be honest,” Rahm Emanuel said in a recent interview. “The goal isn’t to see whether I can pass this through the executive board of the Brookings Institution. I’m passing it through the United States Congress with people who represent constituents.”

He went on: “I’m sure there are a lot of people sitting in the shade at the Aspen Institute — my brother being one of them — who will tell you what the ideal plan is. Great, fascinating. You have the art of the possible measured against the ideal.”

Mr. Orszag would not be interviewed. But in an e-mail message sent through a spokesman, he said the current legislation “lays the foundation” for cost-cutting over the long-term, adding: “Will more need to be done in the future? Absolutely.”

Senator Susan Collins, the Maine Republican whose vote the administration is courting, convened a news conference on Monday with Senator Lamar Alexander of Tennessee, a member of the Republican leadership, to spotlight her concerns over cost containment. Ms. Collins said she had been meeting with a group of moderate Democrats who shared her views.

“I don’t believe we need more pilot projects to show us that health care delivery reforms are necessary,” she said in an interview. She added, “I think people are much more upset over the cost of care than the administration is acknowledging.”

Both the House and the Senate are proposing cost-saving measures. The House bill projects $440 billion in Medicare savings over 10 years; the Senate Finance Committee bill projects about $420 billion. White House officials say there will be additional, substantial savings in the private sector, as well. But how much is not clear.

Still, it is one thing to wring savings out of a bloated system, quite another to change the way that system does business.

Experts agree that the Senate Finance bill does more to put systemic changes in place. That is because the bill includes two measures that health economists favor: a tax on high-value “Cadillac” health plans, and an independent commission that would make binding recommendations on how to cut Medicare costs.

House Democrats strongly oppose the Cadillac tax, which would hurt, among other people, union workers with generous benefit plans. But Ms. DeParle said in an interview that she sensed fresh interest in the House in adopting the Medicare commission idea. “There is a lot of support for cost containment,” she said.

Dr. Cortese, of the Mayo Clinic, said the bills could do more to reward quality care over quantity. He said he had met with Mr. Orszag and others at the White House and had proposed legislative language that would give Medicare three years to begin rewarding hospitals that are delivering better care at lower cost.

“Our position has been focusing on paying for value,” he said, adding, “My take is there are people in the White House who understand exactly what I’m saying.”

Yet a deal the White House made with the hospital industry could make it difficult to cut costs too deeply.

The White House and the Senate Finance Committee chairman, Max Baucus of Montana, agreed to limit hospitals’ payment reductions to $155 billion over 10 years. Those savings will come almost exclusively from “an agreement to squeeze the prices a little bit across the board, rather than reforming the way payments work,” said Mark McClellan, who ran Medicare under President George W. Bush.

Charlie Wilson's War and Health Care Reform- can we ever get it completely right?

Insuring Resources Commentary

I finally just watched the movie, Charlie Wilson's War, the story of a renegade Congressman, a rich socialite and a rogue CIA agent who began the end of the Soviet Empire with the help of well-armed Afghan freedom fighters through a covert war.

The analogy to the battle for health care reform is apt as we inch closer and closer this fall to a reform package that could forever change the landscape of the American healthcare system. Or, like Charlie Wilson's War in Afghanistan it could come close and ultimately fail.

"These things happened. They were glorious and they changed the world... and then we screwed up the endgame"- U.S. Cong. Charlie Wilson.

Through the covert war in Afghanistan Congress spent over $1 Billion to oust the Soviets but failed to establish a sustainable infrastructure to support a democracy. As Charlie Wilson tried and failed to get just $1 million in funding to build Afghani schools and sustain the momentum from the war viewers are suddenly jolted into the present in our own minds with visions of Al Queda, the Taliban and our own futile overt war.

Full Circle

So what's all this mean for health care reform? Like rebuilding Afghani schools we need to ensure that health care reform brings us a sustainable health care future with incentives for quality care, reduction of waste through lean processes, and payment reform that incents quality and not quantity.

Let's get this right, THIS TIME, let's not do it halfway and leave the outcome unsustainable.

Examples of Lean Processes

The following appeared in the Oshkosh Northwestern:
by Lakshmi U. Tatikonda • for The Northwestern • October 27, 2009

The healthcare industry is in a mess, riddled with haphazard and outdated management systems, inefficiencies and waste, excess bureaucracy and costs, and greedy insurance companies. Waste is rewarded while innovation is ignored or penalized says Dr. John Toussaint, president and CEO of ThedaCare Center for Healthcare Value.

Lean methods (Toyota Production Systems) helped organizations reduce costs, improve quality and customer satisfaction. Critics say that healthcare is different from automobile industry, patients are not cars, and Lean methods don't apply to healthcare. This is not true. According to Dr. W. Edwards Deming, 80 percent of problems are process (system) related. Healthcare, like automobile industry, is a collection of processes and can gain from lean applications.

The causes of waste in healthcare are numerous:

Bureaucracy. Rigid adherence to policies and procedures costs U.S. residents $294.3 billion in healthcare and accounts for at least 31 percent of total U.S. health spending in 1999.

Overhead cost. Between the years 1970 and 2000 physician costs increased about 250 percent, whereas healthcare administrative costs increased by a whopping 2,500 percent.

Errors. The Institute of Medicine estimates that medical errors cost the United States $39.7 billion a year. Dr. Toussaint of ThedaCare, says that quality waste could be as high as 40 percent to 50 percent of costs. It is estimated that 44,000 to 95,000 people die every year from medical errors. Every year more than one million people in the United States suffer from preventable injuries caused by medical errors.

Excesses. One hospital found that 25 percent of the surgical supplies picked for use in operating rooms were never used and returned to the shelf requiring unnecessary re-sterilization.

Complexity. Medical billings cost hospitals $487 per person, and $561 for physicians. In my opinion, medical billings are not just complex, they are incomprehensible and unconscionable.

Overdoing. Ordering unnecessary tests, procedures and unnecessary brand name prescriptions, using many forms that are only slightly different, pharmaceutical companies spending more money on advertising than on R&D are like cracking a nut with sledgehammer.

Band-Aids. Failure to understand and identify root causes of waste, applying Band-Aid solutions, treating onetime special issues as normal occurrence.

Use of personnel. Using highly skilled and highly paid personnel such as an M.D. doing routine low level tasks that can be done by a qualified nurse practitioner.

Despite the many wastes there are success stories using Lean management methods:

Schaumburg, Ill.,-based Cancer Treatment Centers of America reduced the number of chemotherapy process steps from 32 to 16 and the amount of walking from the pharmacy to the chemo lab from 3,570 feet to 608 and increased the in chemotherapies delivered by 30 percent.

New York City Health and Hospitals Corp., once carried $10.2 million in inventory which included expired and useless items and 20 varieties of gloves. By reducing glove variety to two, they negotiated price per case from $58 to $28, saved about $4 millions a year, and realized a one-time gain of $5 million.

By improving its Cardiovascular Health Clinic, Mayo Clinic in Rochester, Minn., reduced process steps from 16 to six and wait time from 33 days to three.

EVirginia Mason Medical Center of Seattle, Wash., reduced staff walking distance by 60 miles per day.

St. Vincent Indianapolis Hospital reduced number of walking steps for emergency department nurses by 78 percent.

By implementing in-room devices for physicians in exam rooms, Virginia Mason reduced errors, lead time for documentation and cost of transcription per patient from $2.56 to $0.24.

ThedaCare cut cost of its in-patient care by 25 percent. "If all hospitals achieve similar results, $400 billion could be saved in Medicare and another $1.3 trillion on the non-Medicare side," says Dr. Dean Gruner, CEO of ThedaCare.

Healthcare cost is not just a political issue, it is also economic, competitive and moral issue. A 10 percent reduction in the $2.4 trillion spent on health care saves $240 billion, which can be used for improving schools, rebuilding roads, retraining unemployed workers and regaining our global competitiveness. Unfortunately, in today's convoluted political environment, the voices of reform are drowned by meaningless chatter.

The U.S. auto industry failed to accept deficiencies and make improvements to gain competitiveness. They acted like spoiled brats crying for candy and got government imposed sanctions, tariffs, quotas and domestic content requirements. You know what happened. Trying to reduce costs without eliminating root causes is like rearranging chairs on the deck of Titanic. Next bailout may be the healthcare industry.

A Doc from Neenah Weighs in at the White House

You've heard or read this from me numerous times at this point but a Dr from Neenah was recently invited to the White House with 149 others to discuss health care reform with President Obama.

Two comments he made are what I'm most interested in pointing out.... here they are:

1) From Sarnecki’s viewpoint, it is a system fraught with inequity and "enormous waste." He said poor patients often are charged more than affluent people for the same procedures, and many doctors prescribe tests and procedures "that provide no value to the patient."

2)"I personally think a public option would be an important part of the bill," he said, "but it’s better to have a bill than no bill" if it means giving up the public option.


One poll I recently saw and posted a few weeks ago said that 60% plus of doctors favor the inclusion of a public plan. Docs are used to dealing with Medicare and Medicaid so its really telling that they are willing to add another government program and low reimbursement.

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Neenah orthopedist joins White House push for health care reform

By LARRY BIVINS • Gannett Washington Bureau • October 6, 2009
Published in the Oshkosh Northwestern


President Barack Obama’s campaign for health care reform has found a solid ally in Dr. Jan Sarnecki, a semi-retired orthopedic surgeon from Neenah.

Sarnecki was among the 150 doctors from around the country recruited to talk about health care reform Monday with Obama at the White House. Obama wants to revamp the nation’s expensive health care system to provide coverage for millions of uninsured Americans, strengthen the plans of those who are covered and prohibit insurers from denying coverage to people because of existing medical conditions.

Obama’s latest push with physicians comes as the Senate Finance Committee is trying to wrap up its version of a health care bill. So far, three House committees and one Senate committee have passed their own versions of a bill. Obama wants a bill to sign by year’s end.

"At this point, we’ve heard all the arguments on both sides of the aisle," Obama told the white-coat-clad doctors gathered in the Rose Garden. "But when you cut through the noise and all the distractions out there, I think what’s most telling is that some of the people who are most supportive of reform are the very medical professionals who know the system best."

From Sarnecki’s viewpoint, it is a system fraught with inequity and "enormous waste." He said poor patients often are charged more than affluent people for the same procedures, and many doctors prescribe tests and procedures "that provide no value to the patient."

Sarnecki recalled the case of one employee who was forced to file for bankruptcy after being notified he had taken his pregnant wife to the "wrong hospital" for emergency care. Sarnecki said the insurance company told the employee that the hospital was not on the company’s list of approved hospitals.

That is part of the experience Sarnecki said is at the heart of his support for a government-run "public option" insurance plan.

"I personally think a public option would be an important part of the bill," he said, "but it’s better to have a bill than no bill" if it means giving up the public option.

Sarnecki, who works at Fox Cities Community Clinic in Menasha, also participated in a teleconference last week with Rep. Steve Kagen, D-Appleton, that was organized by the Wisconsin arm of Organizing for America, Obama’s campaign operation.

"The idea is simply to try to get some momentum toward health care reform," Sarnecki said Monday. "The system we have is just not working well for a large number of people."

Sarnecki’s trip to Washington was coordinated by Doctors for America, a national group of more than 15,000 doctors. Among them is Sarnecki’s daughter, Meg Sarnecki, a family physician in Missoula, Mont.

Other groups that participated include the American Medical Association, the National Medical Association and the American College of Physicians.

Republicans have doctors who oppose Obama’s health care proposals. House Republican Leader John Boehner of Ohio said, "Members of the medical community - who deal with red tape day in and day out - rightly recognize that the Democrats’ government takeover would weaken the doctor-patient relationship that is so critical to making the right health care decisions."

Meanwhile, former Wisconsin Gov. Tommy Thompson, a Republican and secretary of Health and Human Services during the George W. Bush administration, issued a joint statement with former Rep. Dick Gephardt, a Missouri Democrat, pointing to the urgency of passing health care reform.

"Failure to reach an agreement on health reform this year is not an acceptable option," said the statement posted on Politico’s Web site. "Inaction will only increase the burden of rapidly rising health care costs and care denied for millions of American families."

Its not About Rationing, Stupid- Its About Waste

Whether or not we have quality health care reform appears to depend on how good the Democrats are at getting their waste cutting message across. While the other side claims the sky is falliing, i.e. "the Democrats are rationing your health care". - Orrin Hatch

In the end if health care reform fails because quality processes and waste reduction are not emphasized enough I'll know who to blame. And so should all Americans, but that's not how our politics works.

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In Delivering Care, More Isn't Always Better, Experts Say
By Ceci Connolly
Washington Post Staff Writer
Tuesday, September 29, 2009
A dirty word in health-care reform is "rationing," a term that conjures up the image of faceless government bureaucrats denying lifesaving therapies in the name of cutting costs.
But what if the real issue is not the specter of future rationing, but the haphazard, even illogical, way in which care is delivered today?
Medical professionals say the fundamental problem in the nation's health-care system is the widespread misuse and overuse of tests, treatments and drugs that drive up prices, have little value to patients, and can pose serious risks. The question, they say, is not whether there will be rationing, but rather what will be rationed, and when and how.

"More is not necessarily better," said Bernard Rosof, chairman of the board of directors of New York's Huntington Hospital and a board member of the independent National Quality Forum. "In many cases, less is better."

When the Senate Finance Committee resumes its consideration of health-care legislation Tuesday, the lawmakers will be wading into one of the most complex, emotionally charged aspects of today's $2.4 trillion system. Democrats, feeling politically singed by this summer's talk of "death panels," are struggling to explain how a bill that would take hundreds of billions of dollars out of the system would not affect care.

Republicans, sensing a political opening, intend to highlight provisions they say could lead to the denial of medical services, or rationing.

"We don't want to turn health care over to a bunch of bureaucrats in Washington, who then will determine what kind of health care we have," committee member Orrin G. Hatch (R-Utah) said recently. "And you know that rationing is going to happen."

Critics of the Democrats' bill cite places, such as Canada and Europe, where government experts prioritize the delivery of medical services. Wait times, particularly for specialists, may stretch for weeks or months under such a system, they fear.

"Here in the States, we get access to new drugs and medical devices," said Canadian-born Sally C. Pipes, president of the market-oriented Pacific Research Institute. "I have friends in Vancouver who can't get colonoscopies; they wait six or seven months."

Others, however, see problems of misalignment in the American system, fueled by industry advertising, physician fears about malpractice lawsuits and a culture that craves the latest, greatest everything. The situation here, they argue, is that there is not enough care for some, and too much for others.

Often, people with generous insurance plans can run up large bills and face life-threatening complications from unnecessary care: back surgeries that result in wound infections, when physical therapy might have been a more effective treatment; imaging scans that expose patients to radiation; medication-caused side effects that must be treated.

As much as $850 billion spent on medical care each year "can be eliminated without reducing the quality of care," according to a 2008 report by the New England Healthcare Institute. That is enough money to extend insurance coverage to more than 30 million people, according to the Congressional Budget Office.

So What Does Health Care Cost Us?

This article gets several things right. There is a ton of waste in the system. What it gets wrong however, is that it'll take years to amass the evidence to weed it out. The LEAN Institute and The ThedaCare Center for Health Care Value have already studied (www.healthcarevalueleaders.org) it and eliminated it from health care systems. It simply needs to be developed as the model to follow with the right incentives WITHIN health reform. Higher Medicare and Medicaid reimbursment for those implementing LEAN practices, Higher reimbursement under the public plan or co-op models, etc etc.

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"You Have No Idea What Health Costs- If You Did, You Might Just Want Real Reform"- Ezra Klein- Washington Post

The most important health-care document released this week was not Sen. Max Baucus's Healthy Future Act. It was the Kaiser Family Foundation's 2009 Employer Benefits Survey.

While the proposal by Baucus, chairman of the Senate Finance Committee, outlines a direction for policy, the survey, which polls employers about health benefits to assemble a detailed look at the actual cost of health care, fits it squarely in our pocketbooks.

The truth is we all pay, and much more than we recognize, for health care.

For many, it's among the largest investments we'll make, on par, even, with the money we spend on a house or tuck away for retirement. But while it's easy to track our stock portfolios as they tank along with the market, our outlay for health care is less obvious. Employers pay some, and so do individuals, and taxpayers. And some even hides behind the deficit. As such, few of us see the full picture. But to make sense of the proposals for reform, getting a grasp of the cost is critical.

The average health-care coverage for the average family now costs $13,375, according to Kaiser. Over the past decade, premiums have increased by 138 percent. And if the trend continues, by 2019 the average family plan will cost $30,083.

Three years of slightly above-average health insurance will cost a solid six figures.

Those are numbers to marvel at. Those are numbers to fear. But they are not the numbers that loom in the minds of most Americans. And therein lies the problem for health-care reform.

About 160 million Americans receive health coverage through their employers. In general, the employer picks up 73 percent of the tab. This seems like a good deal. In reality, that money comes out of wages.

As Ezekiel Emanuel, who advises Office of Management and Budget Director Peter Orszag on health-care policy, has pointed out, health-care premiums have risen by 300 percent over the past 30 years (and that's after adjusting for inflation). Corporate profit per employee has soared by 200 percent. Hourly earnings for workers, adjusted for inflation, have fallen. The wage increases have been consumed by health-care costs.

Another 80 million Americans are on public plans, mainly Medicare and Medicaid. Those costs are paid by taxpayers. And about 46 million Americans are uninsured. The costs for their care are shifted to the insured: This raises premiums for the average family by $1,100 each year, according to an analysis by Ben Furnas and Peter Harbage of the Center for American Progress.

Imagine if people who touched a hot stove felt only a small fraction of the pain from the burn. That's pretty much what's happening in our health-care system. It hurts enough that we would prefer it to stop, but the urgency is lost.

That's the dilemma for Washington wonks trying to fix this mess: They look at the numbers and see health-care costs crushing our economy, overwhelming our government, swallowing our wages. But the public isn't feeling it. Virtually no one cuts a $13,375 check for health care. Most pay 27 percent of it, or even less. The surest way to cut health-care spending would be to make people shoulder more of the burden directly, as opposed to hiding it in taxes and lost wages. But that's about as popular as a puppy pot roast.

Thinking Long-Term

Health-care reform concentrates on the people in acute distress: the uninsured and the underinsured and the poor few who've been left to the cruel chaos of the individual or small-group insurance markets. The public insurance option -- if it comes to pass -- would be open to only these groups, and the bill's hefty price tag is almost entirely devoted to helping them afford coverage. But what about the rest of us?

The problem for the White House has been that the proposed health reform policies meant to help the average American aren't specific. They're not a cash transfer or a new insurance card. These are the "curve benders," policies meant to cut long-term health-care costs. The problem is they're abstract, speculative and, at times, even unpopular.

The White House's favorite curve bender is called "comparative effectiveness review" -- a fancy way of saying "evidence." Study after study has shown that we waste an incredible amount of money on medical interventions that just don't work. If we can figure out which ones those are, we can stop using them and save money by not buying what we don't need. That may work. But the evidence will take a long time to amass, and we don't yet know what it will show. What if it finds that some brand-new and incredibly expensive treatments are wildly effective? That could raise spending. Industry stakeholders, however, had little interest in waiting around to find out: They made such a fuss that Congress quickly inserted a provision promising that the government wouldn't use any of this evidence in deciding what Medicare and Medicaid would cover. Because God forbid government programs rely on evidence.

Note from Write Resources- We do know the answer to the above, ThedaCare and others can prove to other plans how to do it.

The favorite proposal of liberals is the public insurance option. If the public plan were open to all Americans and partnered with Medicare, it could negotiate deep discounts with health-care providers. The Lewin Group, a health industry consultancy firm, and the Commonwealth Fund, a liberal-leaning health-care advocacy organization, have both estimated that this sort of plan could save the average American 20 to 30 percent on premiums.

Of course, providers don't much like the sound of that because they would see 20 to 30 percent less revenue. And insurers don't much like the sound of that because they could not compete with that sort of buying power. Republicans and centrist Democrats have banded together to weaken the public plan and maybe even remove it altogether. President Obama now promises that the public plan would be open only to the uninsured and wouldn't offer any advantages over private insurers. It won't, in other words, be allowed to save people money.

Conservatives favor the idea of taxing health-care benefits and popularizing "high-deductible health plans." In short, if people have to pay more for health care, they'll use less of it. This is true, but as you might expect, quite unpopular.
Melinda Beeuwkes Buntin, a researcher at the Rand Corporation, and David Cutler, a health economist at Harvard, recently estimated the savings that could be attained by "modernizing" the system over the next 10 years. The changes they examined weren't dramatic. Replacing paper records with computerized files, making it easier for people to comparison-shop across insurers, "bundling" payments for the treatment of a single illness rather than shelling out separately for each doctor visit -- that sort of thing. Added up, they equaled a startling $2 trillion over 10 years. That's a lot of money for policies that have received virtually no attention in the debate.

And yet, this is the quiet promise of health-care reform. The grand theories might fail. They often do. But making the system a bit better, a bit quicker and a bit more agile -- we can do that. And until the stove gets hot enough, it may be all we can do.

LaCrosse health plan is potential model to build from

http://www.jsonline.com/business/59087997.html

This is exactly the type of health care model we should be utilizing to undertake true reform.

Efficient, quality, and integrated care. I apologize for the length of this entry. I think this is very informative, however, so I'd hate to edit it too much.

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Here are excerpts:

La Crosse - The United States would spend less money on health care if more health systems were like Gundersen Lutheran.

This community in western Wisconsin has the fourth-lowest health care costs in the country based on Medicare spending.

Only Honolulu and two North Dakota cities, Fargo and Minot, rank lower. At the same time, the quality of care is as good as or better than most parts of the country.

Gundersen Lutheran, a health care system that employs 6,600 people, including 453 physicians, is one reason. The other is its crosstown competitor, Franciscan Skemp Healthcare, part of the famed Mayo Health System.

Both are among the health systems being cited as proof that the United States can slow the rise in health care spending without hurting quality.

"There are models available, and we happen to be one of them," said Jeff Thompson, a physician and chief executive of Gundersen Lutheran.

Medicare spent 30% less on average for each beneficiary in the La Crosse area than the national average in 2006, the most recent year for which data is available, according to the Dartmouth Atlas of Health Care.

It spent 64.5% less than in Miami and 61% less than in McAllen, Texas, the two most costly areas. And it spent 23% less than in the Milwaukee area.

The huge regional variations in Medicare spending - documented by more than 30 years of research at Dartmouth College - occur after adjusting for age, sex and race.

They also exist among areas with similar poverty rates. And they exist within the same geographic areas, varying from one hospital to another.

The variations show that some parts of the country - and some health systems - simply make better use of health care dollars.

The doctors and hospitals in places such as La Crosse, Eugene, Ore., and Grand Junction, Colo., do a better job of eliminating duplicative and unnecessary care, preventing illness or detecting it earlier, avoiding unneeded or preventable hospitalizations, increasing productivity and reducing administrative costs.

They also challenge the contention that slowing the rise in health care spending will mean denying patients needed care. And they refute the widely held belief that more care is better care, and that expensive care is even better.

The evidence is indisputable that high-cost communities do not have better health outcomes, said Tom Oliver, a professor at the University of Wisconsin School of Medicine and Public Health.

"We are spending billions of dollars that is wasted in our health care system," Oliver said.
Quality care

No simple explanation exists why Gundersen Lutheran or the Mayo Health System can provide quality care at a fraction of the cost of their counterparts in Miami or McAllen. But both are integrated health care systems that employ doctors, and research suggests that integrated systems and large physician practices closely aligned with a hospital often produce better care at a lower cost.


Gundersen Lutheran and other integrated systems also often operate their own health insurance plans. That, too, could contribute to their lower costs by giving them an additional incentive to provide efficient care.

The Gundersen Lutheran health plan accounts for about 28% of the revenue at its hospital and its clinics. But when a patient is insured by the plan, the cost of his or her care isn't passed on to an insurance company. Gundersen Lutheran instead incurs the costs.

Being integrated gives Gundersen Lutheran a huge advantage in coordinating care, getting information on best practices to physicians and creating a culture of shared values, said Thompson, its chief executive.

Doctors run the health system, and they are expected to become involved in its operations and to work to control costs, he said.

The health system's orthopedic surgeons, for example, reduced costs by $900,000 a year just by getting together and agreeing to use medical devices from one supplier.

Standardizing care also is easier in an integrated system. The doctors at Gundersen Lutheran have developed specific guidelines and order sets for specific diseases and procedures.

When Gundersen Lutheran installed an information technology system in its hospital, it had more than 300 order sets, said Brian Mulrennan, an internist. It was told by Epic Systems Corp., the Madison-area company that designed the system, that some hospitals had none.

This means that doctors who specialize in diseases of the ear, nose and throat, for example, have developed standard orders for the post-operative care for children who have had tubes placed in their ears for chronic infections.

The standard orders lessen the variation in cost and outcomes.

At the same time, nurses no longer have to follow slightly different orders from each physician, thereby reducing the chance of error.

All this is harder to do when doctors work for dozens of small practices. First, the doctors have to be willing to take the time to develop and agree on the guidelines or standard orders.

And the hospital may be wary of antagonizing doctors who bring it patients and revenue.

There's a saying in health care that a hospital's first customer is the doctor. That's less of a problem in an integrated system that employs them.

Practice guidelines and standard order sets also can help control discretionary care, such as office visits, referrals to specialists and the use of imaging tests. It is one reason for the huge variation in health care costs.


Culture also plays a part. The doctors at Gundersen Lutheran repeatedly refer to the value placed on cooperation and on a focus on the patient. And the health system works to recruit doctors who understand those values.


Gunderson doctors are well paid and make excellent livings. They just aren't the highest paid.

When recruiting, if a doctor notes that he or she could make more money in a Chicago suburb, Thompson will say, "Then you should go."

The low costs incurred by Medicare in La Crosse also stem partly from a communitywide initiative, begun in the 1980s, to encourage people to have advance directives - legal documents that state patients' decisions about end-of-life care should they become incapacitated.

"It's now so part of the process of care that, when we don't know a patient's wishes, it's upsetting to people," said Bud Hammes, a clinical ethicist and director of medical humanities at the Gundersen Lutheran Medical Foundation.

The program, which has drawn international attention, enables doctors to know when patients don't want heroic measures taken to prolong their lives.

In the last six months of life, Medicare spends 29%, or about $8,000, less on patients treated at Gundersen Lutheran than the national average. And it spends roughly $10,000 less than at Aurora St. Luke's Medical Center and Froedtert Hospital, the two hospitals in the Milwaukee area with the highest costs.
No quick cures

National data on the wide variation in costs is available to researchers only for Medicare patients. But studies suggest that how doctors and hospitals provide care for Medicare beneficiaries indicates how they treat patients covered by commercial health plans.

Gundersen Lutheran gives credence to that research. The health system says that its rate increases for commercial plans for the past three years were below the rate of inflation.

That's almost unheard of in health care.

The challenge is how to make the U.S. health care system look more like Gundersen Lutheran and other integrated systems.

That won't be easy to do.

Integrated systems, including large physician practices closely affiliated with hospitals, such as Dean Health System in Madison and the Marshfield Clinic, are common in Wisconsin. But they aren't the norm in the U.S. health care system.

As recently as 2005, roughly half of all office visits were made to practices with one or two physicians, according to the National Ambulatory Medical Care Survey.

Yet the Dartmouth research suggests that high-cost markets are characterized by a much higher percentage of physicians in solo or two-person practices. That kind of fragmentation is characteristic of the U.S. health care system.

It also will be one of the challenges in slowing the growth in health care spending.

Analysis of Obama's Speech

President Obama on Wednesday clearly laid out his vision for health care reform. Although the speech was long he actually succinctly stated his goals and laid out his vision in language that should make it difficult for opponents to mis-represent and lie about.

Cost and Waste issues
On my favorite topic the President had this to say:
"We've estimated that most of this plan can be paid for by finding savings within the existing health care system - a system that is currently full of waste and abuse. Right now, too much of the hard-earned savings and tax dollars we spend on health care doesn't make us healthier. That's not my judgment - it's the judgment of medical professionals across this country. And this is also true when it comes to Medicare and Medicaid."

He's right but I'm going to be very watchful of the details on this as I hope he is talking about instituting health care reimbursement based on "episodes of care" and I hope the plan includes implementing LEAN processes.

There was no mention of either in the speech. As the President said there are many details that need to be worked out to flesh out the basic proposal he announced.

On Medicare and Medicaid there was little detail but he reassured seniors and people with disabilities that he would protect the programs they need and rely on. I'm sure there are important new ideas that will impact these groups within Obama's and Baucus's plans. Please check back here for that analysis soon.

On the public plan
The President said, "An additional step we can take to keep insurance companies honest is by making a not-for-profit public option available in the insurance exchange. Let me be clear - it would only be an option for those who don't have insurance. No one would be forced to choose it, and it would not impact those of you who already have insurance. In fact, based on Congressional Budget Office estimates, we believe that less than 5% of Americans would sign up." Taxpayers will not be subsidizing this public insurance option. Obama said, "The public insurance option would have to be self-sufficient and rely on the premiums it collects."

This should clear up the idea of a gov't takeover of health care but I doubt it will and in the end I'd bet that health co-ops are what is implemented as a compromise. I've said that before and I'd bet my mortgage on it being the alternative option.

Individual and Small Business Tax Credits
For those individuals and small businesses who still cannot afford the lower-priced insurance available in the exchange, we will provide tax credits, the size of which will be based on your need. This exchange will take effect in four years, which will give us time to do it right. In the meantime, for those Americans who can't get insurance today because they have pre-existing medical conditions, we will immediately offer low-cost coverage that will protect you against financial ruin if you become seriously ill. This was a good idea when Senator John McCain proposed it in the campaign, it's a good idea now, and we should embrace it.

Cost of the plan
The President- "I will not sign a plan that adds one dime to our deficits - either now or in the future. Period. And to prove that I'm serious, there will be a provision in this plan that requires us to come forward with more spending cuts if the savings we promised don't materialize." The plan will cost around $900 billion over ten years. Most of these costs will be paid for with money already being spent - but spent badly - in the existing health care system. The plan will not add to our deficit. The middle-class will realize greater security, not higher taxes. Obama reiterated the dire need to curb rising medical costs saying, "if we are able to slow the growth of health care costs by just one-tenth of one percent each year, it will actually reduce the deficit by $4 trillion over the long term.

As always more and more details will be forthcoming. I will research how the plan addresses the waste issue and the provider payment issues. These are the key components and will make or break any bill that becomes law. Please stay tuned, engage, and provide your comments.

ThedaCare touted as national model

This is from Fox News:

Maybe its because ThedaCare employs LEAN process adopted from manufacturing. Whatever the reason, FoxNews seems to understand one basic element of health care reform. Medical costs are driving the need for health care reform. Reforming the insurance side will not achieve the true savings that are needed. This is a lesson that has fallen on deaf ears so far on Democratic decision-makers despite this writer's repeated efforts, letters and phone calls to Congressional offices.

ThedaCare institued these measures to cut costs but amazingly they also IMPROVED patient health outcomes.

See this link for an informative video on ThedaCare's lean practices and cost cutting collaborative care model:
http://www.foxnews.com/search-results/m/25995515/collaborative-care.htm#q=ThedaCare