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Physicians, Business, Professional and Information Technology Communities
Networking to Restore Accountability in HealthCare & Medical Practice
Tuesday, January 28, 2003
MedicalTuesday Is Gaining Momentum in Serving the
Profession to Help People
One of our members in Southern California emailed his offer of assistance in promoting MedicalTuesday. He wanted his friends and colleagues to receive the MedicalTuesday letter. At the age of 82, he is learning to use a computer. He has learned how to send email. Twice a day he accomplishes this at the library across the street from his home. However, he was unable to figure out how to send his address book. Since he has no difficulty sleeping on a bus, he departed from Los Angeles on a Friday evening and I picked him up at the station in Sacramento on Saturday morning. As part of the learning process, he watched as I entered his email addresses into the computer. It was late when we finished putting the names of his friends and colleagues into the MedicalTuesday address book, so he remained that evening as a guest in our home. After church the following morning, he returned to Los Angeles. We welcome all of his colleagues, both physicians and nurses, who received our electronic column two weeks ago. Of the entire list, we received only one “Please Remove” request from a faculty member who believes in and lectures about private practice. Since he is dependent on government grants, he does not want the newsletter in his university email box for fear it could be read by others. If you have received this message as a forward, please click on DelMeyer@MedicalTuesday.net and request your personal free subscription. Be sure to forward this message to any person you feel is or might be interested in providing patients with confidential, high quality, personalized health care without the intrusion of the government. Government involvement will always compromise medical care, confidentiality and privacy.
The Real Meaning of Success or What Should Doctors
Do with Their Life?
What Should I Do with My Life? The True Story of People Who Answered the Ultimate Question is the latest book by P O Bronson, author of three bestsellers. Answering That Question, he found, is important to both the working class and serial entrepreneurs. The most debilitating obstacle in taking on The Question is the fear that making a choice is a one-way ride that closes all other doors forever. However, he discovered “keeping the doors open” is a trap–an excuse to stay uninvolved. He describes Phi Beta Slackers as those who hopped between esteemed grad schools, fat corporate gigs and prestigious fellowships, appearing as if they had their act together yet ultimately feeling like observers who left their intellect behind. He cites a young lady with tremendous ability and infinite choices who finally figured out that it was the need to look brilliant that kept her from answering The Question. Fortunately, she was able to shift gears and make strides toward answering a more important question, “To what can I devote my life?” This question resolves the conflict between who we are and what we do. We are all writing the story of our own life. It’s not a story of conquest. It’s a story of discovery. Through trial and error, we learn what gifts we have to offer the world and are made aware of what we really need. This Big Bold Leap turns out to be only the first step.
Physicians Should Rededicate Their Life
People–Their Own Patients
Bronson has a lesson for us as physicians. Many in our profession have been caught up in the entrepreneurial trap. They obtain MBAs, become administrators, politicians or Phi Beta Slackers, or in some way sell their souls to corporate HMOs, managed care, Medicare or government medicine. These physicians think they are actually providing a great service; however, their involvement places the patient - the very reason for our existence - at the bottom of the food chain. I remember the Reverend Dennis Schlecht once sermonizing that the greatest harm to humankind is sometimes done by people who feel they are doing the greatest good. When we went to medical school and then postdoctoral general or specialized training, we answered the question, What should I do with my life? We must now answer the more important question, To what can I devote my life? MedicalTuesday will continue to work endlessly to help us devote our lives to those we serve, our patients. We will not assist the insurance carrier or government bureaucracy that neither helps us serve our patients nor helps our patients obtain optimal HealthCare. Instead, these third parties only serve as an obstruction.
Last week, a patient nearly 50 years old came in for an annual exam. He requested an MRI for his aching shoulder, as well as a colonoscopy since it was an insured benefit. Examination of the shoulder was negative and the pain was not severe enough to take analgesics. Examination of his prostate, which also includes a stool exam, was negative for blood. There was no family history of cancer of the colon or any type of cancer. I explained that there was no significant medical reason for adding approximately $3000 in consultations and procedures. He stated his wife was a nurse and wanted him to have the MRI and colonoscopy. To evaluate how this would play out in the private market, I asked the patient if he would still want these additional $3000 of further consultations and tests if a co-payment of 10 percent or $300 were required, expecting that I would get to 20 percent or 30 percent which is where my anecdotal information suggests the market kicks in for outpatient medicine. However, in this case, the patient was unwilling to pay even a 10 percent co-pay. The $3,000 worth of medical costs would not be worth $300 to him. He wanted this unnecessary “benefit” only if other people’s money (OPM) paid for it. We would add $90 billion annually to our health care costs if 10 percent of the population (30 million people) expects taxpayers or premium payers to pay 10 times the value that the recipient of care feels it’s worth. This is why all single-payer or socialized systems throughout the world have to severely ration health care. Patients would ration their own unnecessary health care costs if health care were subject to market forces. This is more patient sensitive than massive prolonged waiting lists as found in Canadian Medicare, British National Health Service and other centralized plans throughout the world that jeopardize health care.
When HealthCare Is Part of Government, it Competes
with Every Government Program
Several decades ago, when I was a visiting consultant to San Juan Hospital in Lima, Peru’s largest hospital, I was given a tour of the facilities. The doctors showed me seven x-ray suites and were proud to announce that two were functional, the most that ever worked on the same day. They showed me their ICU with four monitored beds. I saw the new monitors but no tracings. The doctors apologized that nonfunctional equipment had been purchased from Eastern Europe but explained that they had no control over the purchasing process. No medical input was required for the decision to purchase equipment that monitors life in order to avoid death. They presented this as a business transaction. However, in a business transaction both parties have to benefit. This purchase was a bureaucratic decision in which Peru shipped anchovies to Eastern Europe in exchange for the monitoring equipment. Whether or not the monitors work is not always relevant in a socialistic system. At their grand rounds, the physicians presented a smoker with a mass at the hilum that appeared on his chest x-ray indicating lung cancer. This diagnosis needs to be confirmed so that appropriate medical vs surgical treatment can be rendered. After the clinical discussion, I asked for the bronchoscopy findings. They apologized. They did not have a bronchoscope, but quickly stated, “We have requested one each year for the last seven years.” (The eight hospitals in Sacramento, with varying bed capacities from 40 to 400, each had a bronchoscope while this 800-bed hospital had none.) When I asked how tissue diagnosis would be made to determine medical vs surgical treatment, the thoracic surgeon stated that he would do a thoracotomy to make the determination. He had to cut into the chest to reach the central portion of the lung to find out if surgery was needed, when a bronchoscopic tube through the patient’s nose into his throat would very likely have given the answer. What if it was a “small oat cell carcinoma” where medical treatment is preferred since surgery may hasten death? Yes, when health care is part of government, it will always suffer.
Redding Medical Center Was Big Business at
MedicalTuesday has been following the Redding, California, Tenet Hospital “Scandal” in several of our issues. The Wall Street Journal again gives the most comprehensive summary: At first glance it looked like one more corporate scandal after government raids and audits occurred. But looking more deeply, one finds a story of the perils of running a public company in the regulatory maze known as Medicare. Health care providers have been gaming Medicare since that bizarrely complex federal insurance program evolved in the 1980s into a system of Soviet-style price controls. Medicare pays a fixed amount for a treatment regardless of costs. Companies, in turn, search for loopholes in the system’s 100,000 pages of regulations to make up the difference. Sooner or later Medicare discovers the “loophole,” closes it and the cycle starts all over. Medicare is a government bureaucracy that fell years behind on its calculations of charges to cost ratios. Tenet has a right to increase its charges and what they did may not be illegal. Nor is Tenet an isolated case. Tenet did quit using this loophole which reduced revenue by $2 million dollars a day or three-quarter billion per year. If all of Tenet’s 140 hospitals have similar revenue, this “loophole” could amount to $100 Billion in just one hospital system. WSJ concludes that Tenet’s problems are an example of what happens when the private market, which prices health care via actual demand and costs, runs headlong into Medicare’s artificial world of regulations, price caps and overage limits. Only when Medicare is reformed to respond to market incentives rather than to bureaucratic command and control will “frauds” like Tenet stop happening. The real shame is that so much American business ingenuity goes into devising ways to navigate Medicare rules instead of finding better health-care solutions. Tenet’s most pressing problem according to the WSJ editorial isn’t surviving a Medicare audit, but regaining the trust of its shareholders. There are no loopholes in that game.
Generic Drugs Are Moving Through an Artificial World
Milt Freudenheim writes in the New York Times that the prices of generic drugs are rising almost twice as rapidly as prices of brand-name drugs. This is happening for several reasons. First, a large number of patents on popular brand-name drugs expired this year, allowing makers of generic copies to enter the market. Makers of generic drugs typically charge higher prices when the first generic versions of expensive medicines reach pharmacy shelves. The price of one new generic drug, which replicates the ulcer drug Prilosec, one of the best-selling drugs ever, is so close to the price of the brand-name medicine that at least one large insurer is not even trying to switch patients to the generic. David Olson, a spokesman for Health Net, a big California-based health insurer, said that its members were typically charged $30 or $40 for a month's supply of Prilosec, and for now the same co-payment would apply to its generic omeprazole. In addition, the generic-drug industry is consolidating, leaving fewer companies to compete on the prices of older generic drugs. Last month, Watson Pharmaceuticals, a large manufacturer of generic drugs, raised the price of the tranquilizer meprobamate, the generic version of Miltown which lost patent protection more than 20 years ago, from 12 cents to 99 cents, a 725 percent increase. Other manufacturers have raised the prices of some older generic drugs as much as 1,000 percent. And wholesalers, drug-plan managers and pharmacies have all found they can make higher profits on generic drugs and still offer prices that are typically well below those of brand-name drugs. From January to November 2002, consumers spent $19.4 billion on generic drugs compared with $98.6 billion on brand-name drugs. The companies that distribute generic drugs also find them to be more lucrative than brand-name drugs. Lawrence Marsh, a health care securities analyst at Lehman Brothers, said the wholesalers often mark up generic drugs 10 to 15 percent, compared with a typical 5 percent markup on brand-name drugs. Pharmacists also say they rely on higher markups on generics because they are allowed so little profit on brand-name drugs under managed care. We must remember that the discrimination against pharmaceutical patents, which were shortened many years ago to benefit patients, force the companies to recover their billions of dollars of research costs in a relatively short period of time. This drives the price considerably higher than would otherwise occur if they had the same number of recuperative years that other patents receive. So, what was designed to help patients at the expense of the pharmaceutical industry may hurt patients in the long haul. If the industry, while trying to provide us with the latest lifesaving drugs, is unable to recap its research cost, it will simply be forced out of business.
NCPA Names Capitol Hill Veteran, Michael F. Cannon,
Director of Government Affairs
The Dallas-based National Center for Policy Analysis (NCPA) announced the addition of Michael F. Cannon
as its Director of
Government Affairs. In this role, Cannon will represent the NCPA before the Bush
administration, on Capitol Hill, and will serve as a liaison to other think
tanks, trade groups and policy organizations. Cannon comes to the NCPA from the
U.S. Senate Republican Policy Committee where he served as a domestic policy
analyst, formulating policy and counseling Senators on health, education, labor,
welfare and Second Amendment legislation, among other duties.
"I am excited to have Michael on board," said NCPA President John C. Goodman. "He is highly regarded for his Washington savvy as well as his insights into a wide range of policy issues from health care to education to economic policy."
MedicalTuesday will also be looking forward to his reports. We will return to Dr Goodman’s Twenty Myths in the next issue. There has been a revision of his book on the website, which changed the numbering sequence, but we will review the next ten myths in their original sequence over the next ten months.
MedicalTuesday Recommends the Following in Restoring
• The National Center for Policy Analysis, John C Goodman, PhD, President, issues a weekly Health Policy Digest which is a health summary of the full NCPA daily report. You may log onto NCPA (www.ncpa.org) and register to received one or more of these reports.
• The Mercatus Center at George Mason University is a strong advocate for accountability in government. This week we heard from Maurice McTigue, QSO, Distinguished Visiting Scholar, who was instrumental in revolutionizing the way government did business in New Zealand from 1984 to 1994. By looking at how effective every single government program was in achieving the required results, New Zealand went from having the most socialized and highly-regulated economy of any western-style democracy, to having the freest -- reducing the cost of government from nearly half to slightly over a quarter of the GDP. He is optimistic about the progress the Mercatus Center is making in the US. You may request a copy of the pamphlet, “A Day in the Life of a Regulated American Family,” which explains just where the regulatory cost of $8,000 per family per year goes. Nobel Laureate Vernon L Smith, PhD, has joined their Economics faculty. Please log on at www.mercatus.org to read their government accountability reports and information on Dr Smith’s economic experiments which help us understand health care issues. You can also register to receive updates.
• Martin Masse, Director of the Montreal Economic Institute, is the publisher of the webzine: Le Québécois Libre. Please log on at www.quebecoislibre.org/apmasse.htm to review his free market-based articles, some will allow you to brush up on your French, or to register to receive copies of his webzine on a regular basis.
• We also recommend the Ludwig von Mises Institute, Lew Rockwell, President, as a rich source of free market materials, probably the best daily course in economics we’ve seen. If you read these essays on a daily basis, it would probably be equivalent to taking Economics 11 and 51 in college, with considerably less bias. Please log on at www.mises.org to obtain the foundation’s daily reports. You may also log onto Lew’s premier free market site at www.lewrockwell.com to read some of his lectures to medical groups, such as how state medicine subsidizes illness.
MedicalTuesday Supports These Efforts in Restoring
the Doctor & Patient Interface:
• PATMOS EmergiClinic at www.emergiclinic.com, where Robert Berry, MD, an emergency physician and internist, provides prompt care for many of the injuries and illnesses treated in Emergency Rooms at a fraction of their cost, as well as an internal medicine practice.
• Dennis Gabos, MD, President of the Society for the Education of Physicians and Patients (SEPP), www.sepp.net, for making an effort in Protecting, Preserving and Promoting, the Rights, Freedoms and Responsibilities of Patients and Health Care Professionals, with a special page for our colleagues in nursing.
• Drs David MacDonald and Vern Cherewatenko for their success in restoring private-based medical practice which has grown internationally through their SimpleCare model network, www.simplecare.com. They will be presenting their plan at the AAPS meetings in San Antonio on Saturday.
• The Association of American Physicians & Surgeons, The Voice for Private Physicians Since 1943, for representing physicians in their struggles against bureaucratic medicine and loss of medical privacy. The AAPS midyear one-day conference, Thrive–Not Just Survive II, is being held this Saturday, February 1, 2003, in San Antonio. This conference sold out last year and the hotel is sold out this year. You may still register Online and reserve rooms at nearby hotels at www.aapsonline.org. This workshop is co-sponsored by the Baxter County Medical Society. Topics this year include: Opting out of Medicare; How to set up a Cash Practice with SimpleCare; Billing, Coding, Compliance & Pitfalls; Save on HIPAA compliance; Prepare for and Avoid Fraud Prosecutions and Audits and how to make your Practice Judgment Proof; Surviving Sham Peer Review and licensing hoops. You may also call 1-800-635-1196 to register.
Stay Tuned to the MedicalTuesday.Network
Each individual on our mailing list is personally known, or requested to be placed on our mailing list, or was recommended as someone interested in our cause of making Private HealthCare affordable and accountable. If this is correct, you may consider opening a folder in your inbox labeled MedicalTuesday or copying these messages to your template file so that they are available to be forwarded or reformatted as new when the occasion arises. If this is not correct or you are not interested in or sympathetic to a Private Personal Confidential HealthCare system, email DelMeyer@MedicalTuesday.net and your name will be sorrowfully removed.
Del Meyer, MD, CEO & Founder