Healthcare Costs and Deductibles

Despite all the changes from the HITECH act and the healthcare reform there remains a continuing problem of healthcare costs and the deductible. This was brought home to me listening to NPR on health and the podcast: Sleep My Little Couch Potato – Sleep“.
You can listen here at around minute 13:00).

The title hides a segment on the to the “Fancy Diagnosis of House

Where All Things Considered dissected the cost of procedures ordered up on “House” that is featured in a book by Andrew Holtz (The Medical Science of House MD). What was shocking was the numbers featured in the example.

• Liver biopsy: $ 8,000 – 11,000
• MRI: $ 200 – 1,000
• Splenectomy: $ 140,000 (8 days in hospital)

As Andrew said anytime you get into understanding healthcare costs

“we just don’t know (how much things cost), it depends on what variety of the procedure, in which institution (!!!), if the moon is in retrograde…it seems as with anything else in healthcare trying to nail down what seems like a simple question turns into an episode of bizzaroland”

This is  continuing problem and compounded by co pays and deductibles that are rising for many people as companies try to reduce the impact of rising health care costs. In fact most polices, even ones that people would consider “good” insurance includes shared costs that might read “you pay 30%, plan pays 70%”. There are some caps on this but even for relatively simple treatments you can rapidly find yourself with big unexpected bills even with “full” medical insurance. And many of these plans have lifetime limits that may seem large (1 – 2 million dollars) but treatment of any significant condition (cardiac, cancer these being the top two killers) and you can see that maximum reached very quickly

The latest changes are trying to move the system in the right direction but the problem of medical of medical bankruptcy is likely to explode in the coming years as the population ages, coverage decreases and gets more expensive and healthcare costs continue to rise unabated.

I suggest you read the fine print now on your policy and start planning for these costs since we can typically expect to be accessing and needing more and more healthcare as we age.

Universal Health Care – Pay While You are Healthy

The fear uncertainty and doubt over the issue of providing healthcare to everyone in the US is debilitating. And consider the range of special interests who reject the notion and fear any solution that involves the government. The recent press conference by President Obama (full text here and on the whitehouse blog in video format) while focused on the economy mentioned healthcare (17 times by my count) as the underlying problem:

the biggest driver of long-term deficits are the huge healthcare costs that we’ve got out here that we’re going to have to tackle and we

And

But it is — it is going to be an impossible task for us to balance our budget if we’re not taking on rising healthcare costs

And

…the reason it’s hard is because we’ve accumulated a structural deficit that’s going to take a long time, and we’re not going to be able to do it next year or the year after or three years from now. What we have to do is bend the curve on these deficit projections. And the best way for us to do that is to reduce healthcare costs. That’s not just my opinion. That’s the opinion of almost every single person who has looked at our long-term fiscal situation.

Naturally the reactions were wide and varied but I think he’s right about the healthcare cost issue and the need to focus on this. The proposal he floated at the recent healthcare forum was a Medicare like insurance plan to anyone at any age concurrent with commercial insurers offering private insurance. The detail was covered in the NY Times Piece: Health Plan for All and the Concerns It Raises that detailed the inevitable rejection by the insurance industry:

But the insurance industry and others wary of too much government intervention vehemently oppose the idea. They say the heavy hand of the government will eventually push out the private insurers, leaving the government option as the only option. That is why the industry seems unwilling to give ground on the issue, even while making other concessions to national health reform — like the industry’s announcement on Tuesday that it might be willing to stop charging sick people higher rates than healthy customers.

Interesting that finally there is some focus on the terrible circumstance that the uninsured and sick people find themselves in. The issue of the costs for uninsured patients was highlighted in a compelling episode of “30 Days” by Morgan Spurlock (of “Supersize Me” fame) titled Minimum Wage. The series was simple – take on a specific circumstance and live it for 30 days. Morgan did with his girlfriend living on a minimum wage (summary and the episode here). As he said

We don’t see the people that surround us. We don’t see the people who are struggling to get by that are right next to us. And I have seen how hard the struggle is. I have been here. And I only did it for a month, and there’s people who do this their whole lives.

and Alex his girlfriend who unfortunately developed a Urinary Tract Infection that required treatment said:

Even if you are among the “working poor”, and working two jobs at even above minimum wage, you’re still just barely gonna make it, and God forbid anything happen to you. It’s really, really, really hard

They just about coped but it was the healthcare costs that drowned them. Alex’s urinary tract infection required an early morning trip to the ER to be seen and receive a prescription for antibiotics that they had to fill at CVS across town for $20 – this on top of 1-2 days of not working. Morgan hurt his wrist but had to keep working as he had no sick time and that made his wrist worse. He tried to use a free clinic but it only took 20 people and he was number 35. A days wage lost and still no treatment. He eventually had to take a trip to the ER where he got a $40 ACE bandage. With no insurance and hence no cap or control on the bill their total bill was around ~$1,000 or put another way three months salary.

It’s no wonder the insurance industry is vehemently opposed to any intervention that might provide alternative choices to the outrageous bills leveled on individuals who have no insurance. This was very much the principle behind Jay Parkinson‘s service that he started offering some time back in NY and has since moved to Williamsburg with Hello Health. Providing affordable access to healthcare to everyone and identifying the best suppliers of drugs, procedures and health care services for his patients.

For the healthcare providers there is a tremendous fear that the price pressure of such a system will bring them to their knees. This process has already driven down the time available to see patients to ~7 minutes……why because to maintain income if the price paid per unit falls you need to do more units (in this case units = patients).

The trouble with all these methods is we value the healthcare received incorrectly based on activity without focus on prevention and keeping people healthy. The system is complex, stocked full of a wide range of special interests and groups that have and want to continue to make great money from the system. The system is also full of many well intentioned clinicians and care givers who struggle to maintain their income and deliver the service that their patients need and want – it’s a mess.

So here’s a radical thought that I have no doubt will raise a few eyebrows and there will undoubtedly be a host of people suggesting reasons why it might not work but here goes:

Hark back to days gone by in Chinese villages where the villagers paid the medicine man when they were healthy. When they fell ill they stopped paying until they were better and able to work again.

• Incentive – keep patients healthy – check
• Compensation – reasonable and paid based on population under care – check
• Cost – see above based on reasonable level set for population cared for – check
• Catastrophic coverage – check
• Shared insurance risk – check

I know too simplistic for our complex world today but you have to admit there is a certain elegance and beauty to the proposal. Like it, hate it have ideas on how to make it better – leave your comments

Personal Health, Telemedicine and Access Collide

Props to HISTalk for coverage of the San Francisco Telemedicine case. There is no doubting the tragic loss of a young life to suicide (19 year old Stanford Student committed suicide) but the background to the case and in particular the telemedicine element emphasizes the archaic nature of laws and practice of medicine which may be nominally one country but behaves as though it were 51 states (I know 50 states plus a district but that behaves like a state albeit without “representation”). This is not a commentary on the treatment choices but about the surrounding legislation for the practice of medicine across state lines.

A lot of medication is prescribed over the Internet…..Can California regulate it in this fashion? … No out-of-state telemedicine provider has ever been jailed for practicing medicine in California

Best practice aside the litigation does not address the fundamental problems and why a 19 year old would be accessing an on line pharmacy for prescription drugs and even the reasoning behind such a choice. That aside the basis of the lawsuit is the Colorado doctor’s lack of license to practice in California….. he is licensed to practice in Colorado. Seems a license to practice in Colorado should be sufficient unless there is some disease, condition or drug that is unique to California that requires additional testing, licensure and validation to ensure that the doctor meets the necessary quality standards in ANOther State. It is bad enough that the International possibilities that used to be associated with a career in medicine have diminished over the last 50 years but it would seem that we are now placing artificial barriers up to the practice of medicine across state lines…..why?!

Current laws allow for:

…state law allows out-of-state doctors to practice “telemedicine” through the Internet or interactive audio or video transmissions, as long as they act in consultation with a licensed California physician.

Again this is archaic regulations and the only reasonable explanation must require that we “follow the money”… this is not about safety, quality of care or any other mantra.

Like Mr HisTalk I agree – we should be focusing on streamlining the regulations, standards and privacy requirements rather than creating a web of complicated and artificial reasons to prevent the application of technology to allow for telemedicine and remote treatment and diagnosis.

Lets hope this will be a part of any reform packages proposed – time for the US States to step out of the dark ages and catch up with the times and at the same times addresses some of the disparities in cost (and quality) that exists across state lines (some quality reports suggest better value for money paid in one state vs others) and even international borders (drug costs that are 77% higher in the US for comparable drugs).

Healthcare US vs UK Comparison

There are many comparisons of the US and UK health care system but there is hardly a UK citizen living in the US that does not worry that the nightmare described in this essay “Fragile American Dream – Part 1 and Part 2….

It boils down to the catastrophic coverage and end of life issues that have yet to be addressed or resolved. For those who grew up in the system there is probably some degree of concern but a vague acceptance that this the way it is. Rising costs as featured in the rising costs here manifest in escalating drug costs, covered to some extent by the insurance while you have it but at some point when it is either no longer possible to be employed (age or health reasons) you enter the nightmare scenario

Then came the day that I had to give up work, I worked for a Company who treated me very well when I retired. However this is when the American Dream started to turn into a nightmare. I was eligible for 6 months free medical coverage then a further 6 months at a cost to me of what the Company paid; a substantial hike, especially on an income reduced by 40%. After this period something calls COBRA kicks in for one more year and this is when it gets really expensive, approximately 3 times more than the cost the Company was paying but I would still have coverage. When COBRA runs out, effectively I am uninsured, yes there is Medicaid, but from what I have found out it is not easy to get coverage even with a terminal disease. I have overhead enough hardship discussions for people being treated at my Oncologists surgery to understand that everything has to be “battled for”. With a pre-existing condition it becomes almost impossible to get Insurance, some Insures say they will do it, but the cost for good coverage becomes prohibitive.

As the author states luckily he has a choice albeit less than ideal – leaving the country and returning back to the UK for treatment that will not bankrupt him and his family. He finishes with this statement

the UK has many faults but at least the NHS is a safety net for when
things go seriously wrong, unlike out here when effectively you are on
your own.

And that pretty much sums it up…….. there is no effective safety net in the US.