Wednesday, September 30, 2009

Britain's NHS? It's about as good as the health system in Slovenia

The National Health System is on a par with Slovenia and the Czech Republic, according to an analysis by European researchers. The NHS came 14th out of 33 European countries, making it one of the worst systems in Western Europe. The study - the Euro Health Consumer Index - found the NHS performed particularly badly on waiting times, even though these have fallen thanks to Labour targets. The survey says that the NHS is dragged down by waiting lists but the Department of Health claims the report is 'flawed'

It is also one of the least efficient, delivering less service per pound put in. The annual survey is by HealthConsumer Powerhouse, which campaigns for social insurance type systems rather than nationalised models such as the NHS. It ranks 33 systems on 38 factors such as patient rights, waiting times and access to medicines. Total possible score is 1,000 points and the Netherlands tops the list with 875, followed by Denmark (819) and Iceland (811). The UK, with 682 points, ranks just behind Ireland's 701. Lowest ranking of all was Bulgaria's 448 points. The NHS ranking was just above former Communist states Slovenia and the Czech Republic but below France, Germany and Ireland. It did rank better than Italy however.

The Netherlands is the only country which has consistently ranked in the top three during the five years the survey has been carried out.

But the UK's has been steadily increasing. It could have been higher this time, but the report comments: 'A mixed performance is shown by the UK: the overall UK score is dragged down by waiting lists and uneven quality performance'.

A spokesman for the Department of Health said: 'Once again, the European Consumer Health Index report is based on flawed methodology and old data. 'There is a lot of credible and up-to-date evidence available showing just what great strides have been taken, on the back of record investment, in improving NHS services across the country. 'The NHS is treating more people and saving more lives than at any time in its history with waiting times at their lowest levels since records began.' 'Twelve years ago it was not uncommon for patients to have to wait over 18 months for an operation. 'Record investment and dedicated staff have given patients the shortest waits since NHS records began with average waits from referral to start of treatment at around eight weeks for admitted patients and four weeks for non-admitted patients.' [We won't mention the many "fudges" used to produce those figures]


Senior British hospital doctor could face charges after jury rules patient died of gross neglect

A consultant could face a manslaughter investigation after a cancer patient died when she was mistakenly prescribed a lethal overdose of chemotherapy, an inquest heard. Anna McKenna, 56, was given four times the recommended daily amount of Idarubicin to treat her bone marrow cancer. Mother-of-five Mrs McKenna should have taken 60mg of the drug over four days, but was told to take 60mg per day.

Yesterday Avon Deputy Coroner Brian Whitehouse heard a jury return a narrative verdict of manslaughter due to gross neglect after a jury returned a majority decision of eight to two. The ruling now means that the CPS will review its decision that there was no criminal case to answer.

Anna's family told the five-day hearing that blundering doctors ''panicked'' and tried to ''cover up'' the error by refusing to tell them she had been given the wrong medication. The overdose destroyed Anna's infection-fighting white blood cells, leaving her immune system powerless against disease. She developed renal failure and died at the Bristol Oncology Centre three weeks later on April 18 2006.

Dr Jacqueline James, a consultant haematologist at Frenchay Hospital in Bristol, admitted the blunder at the inquest and said she was ''very sorry'' for what happened. Recording a verdict of manslaughter due to gross neglect yesterday, Avon deputy coroner Brian Whitehouse said: ''I offer my sincere condolences to the family."

Mrs McKenna, a housewife from Knowle, Bristol, was diagnosed with multiple myeloma, a cancer of the bone marrow, in March 2006 and prescribed a course of chemotherapy tablets. Her condition was terminal, the treatment was administered in the hope of prolonging her life. Without the medication, doctors gave her just two years to live. But Mrs McKenna was given a prescription for 60mg of Idarubicin per day, instead of the usual 15mg or 20mg per day. The drug left her in agonising pain, suffering with vomiting and diarrhoea. It also sparked a high fever and led to renal failure.

Her daughter Nancy McKenna said: ''It was such a traumatic experience for my whole family seeing our mum like that. You wouldn't treat your dog the way they were treating her. ''Mum was rushed to hospital after being so ill for many days. When we got there we told the doctor that she had been given an overdose and she told me to go home and bring in the medication mum was on. ''I brought it in and the doctor looked at it. I kept on and on as did the rest of the family about the fact she had been overdosed but no one was listening. ''We told the doctors treating mum that we thought she had been given the wrong dose of Idarubicin and we maintain that."

Dr James admitted prescribing four times the recommended dose and said: ''I am very sorry that a mistake was made.'' Verdict: Manslaughter due to gross neglect.

Outside court a family statement, read by solicitor Kerstin Scheel, said: ''The family of Mrs McKenna have been absolutely devastated by her sudden and unnecessary death in April, 2006. ''They feel extremely angry not only that such a serious mistake was made in her prescription but also that this was not found by the pharmacist who was supposed to act as a safety net to the patient. ''They greatly hope that this will never happen again to another patient and that the new safeguards in place will make a difference for others in the future. ''Anna was a devoted wife, mother and grandmother and is sorely missed by her whole family.''

Chris Burton, medical director of North Bristol NHS Trust, said: ''North Bristol NHS Trust would like to take this opportunity to repeat it's sincere apologies and condolences to Mrs McKenna's family and friends. ''The trust has cooperated fully with external investigations into the circumstances surrounding Mrs McKenna's death. ''Patient safety is our priority and following Mrs McKenna's death we made immediate and significant changes to our procedures around prescribing and issuing Idarubicin.''

A spokesman for Avon and Somerset police said: ''South Gloucestershire police investigated the circumstances surrounding the death of Anna McKenna in 2006 and prepared a file for the Crown Prosecution Service. ''After consideration by specialist lawyers, the CPS decided that there was not a criminal case to answer and police submitted a file to the coroner. ''Following the verdict of unlawful killing, the case will be reviewed in liaison with the CPS. South Gloucestershire police again offer their sincere sympathy to the family of Anna McKenna for their loss.''


Poll: Support for Obamacare at New Low

Only 41 percent of voters now support President Barack Obama and the Democrats' healthcare reform proposal — down from 44 percent two weeks ago and the lowest level of support yet measured by Rasmussen Reports. Rasmussen's nationwide telephone survey also found that 56 percent of voters are now opposed to the plan. Just 33 percent of senior citizens favor the plan, while 59 percent are opposed. Other findings of the poll:

# 46 percent of respondents believe the reform plan will likely pass and become law this year, but 47 percent think it will likely not pass, including 15 percent who say it is not at all likely to pass.

# While 23 percent of voters "strongly favor" the legislative effort to reform healthcare, 43 percent are "strongly opposed."

# 24 percent of respondents say the quality of healthcare will improve if the plan passes, and 55 percent say it will get worse.

# 54 percent say passage of the plan will increase the cost of healthcare, and 23 percent say it will lower the cost.

# The overwhelming majority of voters — 78 percent — believe that every American should be able to buy the same health insurance plan that Congress has.

# 53 percent think tort reform will significantly lower the cost of healthcare.

# 48 percent of respondents want a prohibition on abortion in any government subsidized program, and 13 percent want a mandate requiring abortion coverage.

"The most important fundamental is that 68 percent of American voters have health insurance coverage they rate as good or excellent," Scott Rasmussen, president of Rasmussen Reports, wrote recently in The Wall Street Journal. "Most of these voters approach the healthcare reform debate fearing that they have more to lose than to gain."


Blue Dogs in the Doghouse over the Public Option

With the debate over ObamaCare proceeding into the month of October, and still no vote in the House on H.R. 3200, there is no question that House Speaker Nancy Pelosi remains dedicated to pursuing the so-called public “option.” She says it could “save enormous amounts of money.”

Her latest defense of the public “option”—which is not at all optional since it requires every American to have insurance—are a part of her attempts to woo the 52 member House Blue Dog caucus, 40 of whom have sworn up and down not to vote for a plan that adds a single cent to the deficit. The validity of her promise to “save” money is critical.

How much in savings is House leadership promising? According to the Wall Street Journal, “Congressional aides said including a government-run plan for people under 65 in the health overhaul could save as much as $100 billion, if such a plan were to pay health-care providers the low rates used by Medicare…”

Which is funny. The House version of the plan makes eligible some 45 million people not currently covered under government-run health care, taking the number from 80.3 million currently covered to some 125.3 million. It’s simple math. An average premium goes for about $4,700, and adding 45 million to the government rolls, as envisioned under the House bill, would actually add $211.5 billion a year.

Nobody thinks this is deficit-neutral. Except for Barack Obama, the House majority, and a few sycophants who wish to maintain a talking point. By the House majority’s standard, that means the nation will wind up actually “saving” money. “[E]normous amounts of money.” But everyone else knows this will be costly very costly.

And unless House Blue Dogs wish to go from the people’s House to the doghouse, they had better make good on their promise not to add a cent to an already out-of-control debt—now some $11.8 trillion.


Health Care Analogies

It is good that the President has ceased attempting to sell his public option health care initiative on the strength of a comparison to the United States Postal Service. Americans will not soon be convinced of the economic viability of an expansion of public healthcare when it is compared to an entity on track to lose $7 billion this year. This past summer the Government accountability office put the postal service on its high risk list because of its “increasingly shaky financial footing,” and in the spring Post Master General John Potter asked Congress for permission to cut delivery service back to 5 days per week and close 700 offices nation wide. This is not the sort of talk that inspires confidence that a government takeover of the healthcare industry is the answer to our fiscal tribulations.

It is bad that the President, demonstrating what can only be described as intellectual density, has chosen instead to compare his public option to our system of state colleges and universities. This is particularly ironic given the fact that the cost of higher education has been skyrocketing for years and has in fact outpaced that of healthcare. Even more ironic is that according to the College Board's annual tuition survey, the rate of growth of the price of public 4 year colleges has been faster than at private 4 year colleges; a trend that has persisted for 3 decades.

The Los Angeles Times recently reported that the California State Board of Regents has asked for an increase in fees for undergraduate residents that would be 44% higher than they were in 2008. In addition they are considering “ideas to reduce freshman enrollment by an additional 2,300 students…and to charge extra fees for some upper division undergraduate majors, such as business and engineering.” A quick Google search reveals similar stories being reported across the country.

Our public institutions of higher learning struggle with rapidly rising costs and they do so for many of the same reasons as their private competitors, which as it happens are similar to those responsible for increases in the cost of healthcare: inflated demand and over reliance on third party payers and subsidies.

In fairness to the President, one of the points he is trying desperately if unsuccessfully to make is that public and private entities can co-exist. The point his detractors are making with increasing success is that if the problem we are attempting to address is the rising cost of healthcare, a “public option” is not a solution. The presence of a state run university system has not curtailed the rising cost of education in general nor has the “public option” slowed the rise in the cost of Public education specifically.

Of course Obama insists that taxpayers will not be subsidizing his public healthcare option; that it will be “self-sufficient” and “financed solely by the premiums it collects.” Revealing a disturbing lack of economic literacy he insists this can be accomplished because the public option will reduce waste and overhead and will not be burdened by the need to make a profit. (As if profit were some arbitrary and evil charge added onto a product or service. In fact it is the engine that drives the efficiency and cost cutting the president claims to be seeking. If it were not so we would have seen over the years non-profit organizations taking away the customers of profit seeking enterprises. Alas the opposite has been true. But I digress.)

Inquiring minds are dying to know A) why no one else has ever thought to reduce waste and inefficiency and B) what will account for the difference between the true cost of health care services and the price his public option will charge in order to make it “affordable.” Raise your hand if you hear Joe Wilsons voice echoing in the background. Rather like how public universities make higher education affordable to the masses the “public healthcare option” will be subsidized by taxpayers!

And like the public university system, when the government, which will be responsible for setting the price of care (as it sets the price of education at public schools), limits its financial commitment the institution must respond by raising its price and/or cutting and rationing its services. As the price is forced to better reflect the true cost of the service it will become less “affordable,” and like in higher education higher prices will increase the demand for financial aid, which according to both education and health care economists is a major driver of price inflation.

It is not fear of a Black Planet (as has been suggested by several new left apologists) that has sparked public opposition to the President’s ideas for health care reform. For an increasing number of Americans “Obamacare” is analogous with a slow-to-respond or unresponsive bureaucracy, suffering cost over-runs and seeking service reductions, and lay-offs in order to shore up its increasingly “shaky financial footing.”


Democrats unable to quell health care revolt among seniors

Senior citizens are putting the Democratic Party's 2010 election prospects and their health care reform proposals on a collision course. Outraged over Democratic plans to cut between $400 billion and $500 billion from Medicare in the next decade, voters over the age of 65 are poised to make the party suffer even steeper losses at the polls than have already been predicted for the midterm election. "Seniors bear the brunt of these bills as they are currently funded," said Betsey McCaughey, a former Republican lieutenant governor of New York and conservative health care policy expert. "It's a medical assault on seniors."

Democrats argue that Medicare is going bankrupt and must be reined in, and the cuts on the table will for the most part address wasteful spending and not take away benefits. But many seniors, who tend to make up a larger proportion of the electorate in off-year elections, are not convinced. They turned out in huge numbers at town hall meetings this summer, and poll numbers support what appears to be wide opposition among them.

A new survey from Rasmussen Reports found only 33 percent of voters over the age of 65 are in favor of the Democratic health care plan outlined by President Obama -- eight points lower than the electorate as a whole. Of those seniors against the Obama plan, 46 percent said they "strongly oppose" it.

At the center of the debate is a plan to slash spending on a program called Medicare Advantage, which is administered by private insurers and offers benefits beyond regular, government-administered Medicare plans, such as dental and vision coverage in exchange for larger premiums. It is used by about 10 million seniors, roughly 20 percent of all Medicare recipients. In the Senate, lawmakers are drafting a bill that would cut about $123 billion from Medicare Advantage over the next decade, which the Congressional Budget Office estimates would slash extra benefits seniors receive under the Medicare Advantage plans by half and that enrollment would drop by 2.7 million.

Democrats argue that Medicare Advantage costs too much and is driving Medicare toward insolvency, but Republicans are now seeking to protect it, which will undoubtedly help secure votes from this group in 2010.

Overall cuts to Medicare outlined in the Senate bill now being drafted include a $211 billion reduction in payments to hospitals, nursing homes, home help and hospice care, in addition to the cuts in Medicare Advantage. The Medicare reductions are making Democrats nervous, which some health care experts believe will result in a bill with far fewer cuts to the program. Sen. Bill Nelson, D-Fla., has introduced an amendment that would spare those currently enrolled in Medicare Advantage from any new cuts. "I can tell you this senator does not want to be in a position that I am taking away benefits from existing senior citizens," Nelson told the committee.


Tuesday, September 29, 2009

Plans for swingeing hospital cuts as British system on brink of 'Armageddon'

Health service managers warned of an "Armageddon scenario" facing NHS finances as they draw up secret plans for swingeing hospital cuts. Senior officials have set "aggressive" targets to reduce the number of patients referred to specialists, or treated in Accident and Emergency departments, while GPs will be asked to cut down on the amount of time spent in consultations.

The plans are being issued as senior managers warned that the NHS is about to face the greatest financial pressures since its inception. They fear that when the current spending round ends in 2011, the impact of an anticipated real terms freeze or cuts – coming as the demands on the NHS of an ageing population increases – will be devastating.

The NHS Confederation, which represents NHS managers, will tell this week's Labour Party conference that the impending challenge is so great that hospital closures and job cuts must be enforced across the country. It comes as two leading think tanks predict a future funding gap of between £20bn and £40bn within six years of 2011. Regional health authorities have ordered hospitals and primary care trusts to draw up plans for cuts worth billions.

In London, NHS trusts have been told to divert more than half of A&E patients, and those seeing specialists, to cheaper "polyclinics" run by groups of GPs. Meanwhile, family doctors will be asked to speed up their consultations, reducing the average time per patient from 12 minutes to eight.

The instructions drawn up by NHS London, and seen by The Sunday Telegraph, order trusts to demonstrate that they can deliver an "aggressive scenario" in response to funding pressures. Under its "affordability assumptions," already controversial plans to reduce the number of patients treated in hospital are given more demanding targets in an attempt to cut costs.

Sixty per cent of activity which now takes place in A&E departments should happen in community clinics within five years, the document says, along with 55 per cent of outpatient treatment. Thirty per cent of outpatient appointments will be stopped altogether. Managers say not all appointments are necessary, though many doctors argue it is impossible to know in advance which patients do not need to be seen. The number of diagnostic tests carried out will be cut by 15 per cent, while the amount of surgery will be reduced by seven per cent.

Although the "polyclinic" model, to reduce demand on hospitals, is supposed to shift more treatment into the community, GPs will be told to reduce their average appointment time by one third, from 12 minutes to eight.

Senior managers in other regions, who will draw up their own plans later this year, said rural communities faced particular pressures, with small maternity and district general hospitals likely to struggle in the funding crisis.

In a speech tonight to the Labour Party conference in Brighton, the NHS Confederation will warn that the service across the country faces unprecedented difficulties, which require "bold and decisive measures". Its policy director Nigel Edwards told The Sunday Telegraph: "The NHS has never experienced a financial challenge of this magnitude or duration in its history". He said improving the operation of the NHS, and treating more patients earlier in primary care, would not be enough to balance the books. Delegates will be told: "Savings only start to become available when we can shut entire buildings, sites and reduce staffing numbers."

The organisation, which represents NHS managers, will also call for "uncomfortable decisions" to be made to limit staff pay. Under a three year deal already agreed, nurses will receive a rise of 2.25 per cent in April. Sir Robert Naylor, chief executive of University College Hospital in London, said pay should be frozen for NHS staff after that point. If it was not, every one per cent pay rise could cost 10,000 job cuts, he said.

The chief executive said that while he supported plans to treat more patients in the community, he was concerned that PCTs were planning to cut back on hospital services before alternatives were put in place. "The investment in those services has to come first or where do the patients go?" he said, criticising "over simplified" analyses which failed to take into account of increasing public demand.

Dr Laurence Buckman, chairman of the British Medical Association's GP committee, described the plans as "desperate and inadequately thought through". Dr Buckman, who works as a GP in London, said targets to reduce outpatient appointments by 30 per cent would put patients at particular risk. He said: "All this means is that those people who are refused a referral to a specialist will be forced to go privately, or go nowhere. This will be difficult for doctors, but patients will be the real victims." While some specialist referrals turn out to be unnecessary, GPs only asked for a specialist opinion when they needed it, Dr Buckman said.

A study by the King's Fund and the Institute for Fiscal Studies forecasts a funding gap of between £20bn and £40bn by 2017, if funding for the NHS receives no increase, or gets a real terms freeze which only keeps pace with inflation. Sue Slipman, director of the Foundation Trust Network, which represents the best hospitals, warned of an "Armageddon scenario" which could unfold without decisive action on pay, and terms and conditions. She said: "There is a trade-off between saving jobs, and pay increases, and in the current climate, protecting jobs needs to be a priority."

Katherine Murphy, from the Patients Association, accused NHS managers of wasting billions on management and repeated organisational restructuring during the boom years of record investment. She said there was no evidence that plans to shift patients into the community would provide safe care. "Elderly patients often require intensive support which often means lots of staff, in hospitals. The need is only going to get greater – these plans look like madness," she said.

A spokesman for NHS London said its documents provided planning scenarios, rather than forecasts, to cope with a changing economic environment. He said the NHS was investing heavily to ensure care was provided in the most appropriate setting. [Blah, blah, blah!]


NHS dental crisis: Can the rot be stopped?

As new figures reveal over 40 per cent of the population has no NHS dentist can a new review finally fix the system once and for all?

Not that long ago we were queuing in the streets for an NHS dentist, with scenes of hundreds of patients camping overnight likened to the January sales. Now, new figures suggest that many of us have given up, and are paying for private treatment or simply going without care if we cannot afford it. Data from the NHS Information Centre released last month shows that only 58.3 per cent of the population saw an NHS dentist in the two years ending March 2009, with the number of complex treatments, such as root canals and crowns, falling dramatically, by 40 and 50 per cent respectively, since 2004.

Ironically, the parlous state of NHS dentistry seems to have been exacerbated by the very attempt to overhaul it – the 2006 dental contract. The new contract was intended to end the old "drill-and-fill" practice whereby dentists were paid for each treatment they carried out, so the more procedures they undertook the higher their earnings. The idea behind the new contract was to encourage dentists to spend more time on preventative work, teaching patients how to care for their own teeth, thereby reducing future treatment.

Dentists are now paid a fixed contract value for the amount of work they do each year. Work is measured in UDAs (units of dental activity). Dentists now essentially have "UDA targets" to meet each year. Under the new contract, their salaries have not been cut as they had been in the early Nineties, which led to an exodus to the private sector. Dentists are free to choose whether to provide NHS or private treatment, or a combination of the two. While many NHS dentists' basic pay is around £90,000 in large practices, but in areas where NHS practitioners are few and far between, they can make a lot more.

Around 400 practices earn up to £300,000 a year, shared among several dentists. Private dentists earn little more – one survey in 2005 by the Health and Social Care Information Centre estimated the gap at no more that £800 a year. Most claimed to have left the NHS due to the pressure of working harder for less money, with less time to spend on each patient.

Local Primary Care Trusts (PCTs) were given responsibility for providing dental care in their areas. It is they who employ dentists, and it means that managers can offer incentives to dentists to work in their area, and thus increase patient access, eradicating once and for all the problem of how to get on an NHS dentist's list.

But, despite these good intentions, the situation appears to have deteriorated further. According to figures from the NHS Information Centre, last year nearly 50 per cent of NHS dentists did not take on any new patients. In addition, 2,000 dentists have left the NHS since 2006. So what has gone so badly wrong?

The flaws are fundamental, says Liberal Democrat health spokesman Norman Lamb. "Many good dentists have become fed up with NHS bureaucracy, voted with their feet, and left the profession. So there is a danger that while not all the NHS dentists left are second rate by any means, we could end up with a two-tier profession."

Lamb believes that the financial disincentive to carry out complex work is so serious it threatens to "de-skill" the profession and that far from encouraging the public to look after their teeth, "there is no incentive for the dentist to do preventative work at all."

The public are not happy, says Dr Anthony Halperin of the Patient's Association."Simple procedures can end up costing the patient more than before, while there is no incentive for dentists to perform complex and time-consuming treatment. Most of all, the overwhelming public complaint is access."

The majority of dentists are unhappy, too. One complained: "If you take on a new patient who has not been to the dentist for a few years, they might need a lot of work, and you are effectively penalised for doing it. Under the new contract, whether a patient needs one filling or 10 fillings, the dentist gets paid the same."

Another said: 'Dentists are unwilling to take on new patients whose teeth are in a poor state. They know they will be paid the same as if they treated a patient who needs very little work. This is very sad for patients. It means that those who are most desperate for treatment are finding it most difficult to get a dentist."

Dr John Milne, chair of the British Dental Association, the professional association and trade union for dentists, adds that many complain that "the target-driven nature of the existing contract has made life difficult". If a PCT has set targets for the number of procedures it expects to be completed, many dentists are left with no time to teach their patients about hygiene.

So what is the answer? Professor Jimmy Steele, Head of the School of Dental Sciences at Newcastle University led the recent independent review of NHS dentistry, which has just published a set of recommendations aimed at redressing the problems of access and receiving appropriate treatment (for patients) and bureaucracy and pay (for dentists). It has been Prof Steele's unenviable task to pick apart the 2006 contract and put it back together, making it work at no extra cost to the taxpayer.

"The 2006 contract was intended to make fundamental changes in thinking. Dentistry had been pretty much unaltered since the birth of the NHS in 1948," he says. "The idea was that the PCT would be able to buy what they wanted on behalf of their patient, making better use of resources. Previously dentists had been able to move around to where they wanted there was no ability to fit services to local needs."

In effect, dentists could set up an NHS practice where they wanted to live, not necessarily where one was needed. "The idea of local commissioning is sensible," he adds. "Access problems should have been addressed in time."

The new contract also aimed to simplify payments. Previously, dentists billed the NHS centrally for any one of 400 different procedures. The more work they did, the more they got paid. "The new system, where contracts are paid on UDAs in three bands is probably too simple," says Prof Steele. "The payment bands are wide and differ depending on where the dentist is located, on their history, sometimes on their negotiating skills."

Dentists earn one UDA (worth between approximately £17 and £40) for a simple procedure such as a check-up, three UDAs (worth about £75 on average) for any number of fillings (in one appointment), or 12 UDAs (worth about £300) for crowns or dentures, in addition to any other treatment.

"The system is open to misuse," says Prof Steele. "It is possible to take one tooth out and make an impression for a denture and then charge 12 UDAs which is clearly not as complex or difficult as root canal work which pays only a quarter of the fee."

Incentives to take on new patients are not having the desired effect. Far from encouraging dentists to see more patients, it has become easier to make a living seeing existing patients more often. One of the biggest problems is taking time to put a mechanism in place for centrally collecting data, so it is difficult to know where and how the system isn't working.

So do we need to start again from scratch? Prof Steele thinks not: "When we carried out the review it became clear that access is improving, but there is a communication problem. The public didn't know how to find an NHS dentist. Meanwhile the PCT claimed that they were running plenty, and that all the public needed to do was ask. The public would then be saying, 'what's a PCT?' Better communication could sort that problem out easily."

Prof Steele is also recommending improvements in payment methods. "We need a blended contract, where a dentist is paid for every person on his list, and also for every treatment he carries out. We don't want people under-treated any more than over-treated. There also needs to be a reward for quality so we need to get data back into the system."

While Prof Steele approves of the scheme of local commissioning, Norman Lamb warns that PCT managers may not be ready. "We need to train them better, a lot of them are far too passive. You do get pockets of excellence but many don't have the skills they need."

Shake-ups, however worthy, cost money, and increased investment is unlikely. Dentistry is threatened by the spectre of financial cuts, as part of cuts in public services, regardless of who wins the next election.

So while the Patients Association has welcomed Prof Steele's review, Dr Halperin, a dental surgeon who does both NHS and private work in central London, says: "We are concerned that because of funding problems, once again there will be no real improvement in the dental contract and subsequently no improvement to the services for our patients."

The biggest challenge says Dr Milne, is to get all political parties to recognise the value of Prof Steele's report. "We need to embrace it; it is our best chance of providing a dental service of which we can all be proud."

Dr Milne is also optimistic: "The number of dentists in training is increasing, but we need to make the NHS an attractive place to work. And dentists who have left will only return if the NHS offers them the chance to treat their patients properly. Some might even be quite excited at the chance."


Australia: Penny-pinching government healthcare system refuses to save seriously ill young woman

Forcing her into expensive but successful private treatment. In their "kind" socialist hearts, they condemned her to death. Now they are in coverup mode and refusing to admit error -- even though she is living proof of their wrong call

THE Department of Human Services has been accused of abandoning a Victorian woman with a brain lesion who survived only because of life-saving surgery interstate. Victorian medicos ruled her condition was inoperable and the DHS has refused to pay $300,000 for the surgery in a private NSW hospital.

Alicia Withington was sent home to die, but the 30-year-old is living proof the Victorian system failed her.

In another twist, the state Opposition has accused the department of hiding documents relating to Health Minister Daniel Andrews' decision not to fund her operation. Details of the case come after a string of controversies involving the DHS, including:

REVELATIONS vulnerable women in state-monitored care homes were trading sex for cigarettes, or being raped.

CLAIMS the DHS was aware of violence in the home of a toddler six months before she died after an assault by her father.

SHOCK details of a man fathering four children with his daughter who he used as a sex slave for 30 years.

Mrs Withington said Victoria's top neurosurgeons refused to operate on her arteriovenous malformations (AVM) - a tangled mass of abnormal blood vessels 12.5cm long in the right side of her brain. "I had a ticking time bomb in my head about to explode and I was told it was too risky to operate," she said. "I feel I was sent home to die at the age of 27."

But Mrs Withington, now 30, who runs a cafe in Ocean Grove with husband Daniel, sought a second opinion. Sydney specialist Prof Michael Morgan agreed it was risky, but operated in March 2008. "No one should have ever said my AVM was inoperable, because here I am today walking, talking and very much alive," Mrs Withington said.

Mrs Withington and other family members have taken out second mortgages on their homes to pay the bill. "The Health Minister, Daniel Andrews, refused to pay it because he said I had gone through the private system in NSW," she said. "It's not like I went to another country." She says the Victorian Government should have funded the operation because it should have recognised it could be successful.

Opposition community services spokeswoman Mary Wooldridge has taken up Mrs Withington's cause, applying under Freedom of Information for documents held by Daniel Andrews and DHS. Officials told her there were no documents held by Mr Andrews' office on Mrs Withington, in correspondence seen by the Sunday Herald Sun. But in a letter obtained by the paper, Mr Andrews discusses with a Labor MP why the Government would not fund Mrs Withington's treatment. A tribunal has ordered the department to answer requests for information.

A spokesman for Mr Andrews said: "It would not be appropriate for the Government to selectively fund private treatments." He said the minister's letter discussing Mrs Withington's plight was not in Mr Andrews' office, but held by the DHS.


Canada's healthcare limitations good for brokers

Richard Baker is known as a critic of the Canadian health care system, but he's the first to acknowledge that it represents a real bargain for those with routine afflictions.

"In Canada, if your wife is pregnant, you have great prenatal care, great postnatal care, and the delivery is free. If you have the flu, your exam is free. If you break a leg, you can go to the emergency ward, and they'll set it immediately," Mr. Baker said. The trouble starts when patients need treatment that isn't so routine. That's where Mr. Baker comes in. A British Columbia medical broker, he takes patients who find themselves on long waiting lists for procedures such as MRIs and surgeries, and connects them with specialists who can handle their cases immediately. Most of the time, his clients wind up in the United States - and business is booming.

"That's what Americans need to know about the Canadian system," Mr. Baker said. "It's not that we have poor-quality health care - the quality is perfectly good. It's that we have poor access to health care."

Mr. Baker, founder of Timely Medical Alternatives, is among the featured speakers at a conference Monday in Vancouver, British Columbia, aimed at exposing weaknesses in the Canadian single-payer system. The event, billed as a one-day fact-finding trip, is sponsored by the Independence Institute, a Colorado-based free-market think tank that has opposed the Obama administration's push for a public option in U.S. health care. "The idea is to look at real human stories about how the public option treats people with serious medical conditions," said Independence Institute President Jon Caldara. "If we're moving toward the public option, we ought to know what it looks like."

Scheduled participants include Cheryl Baxter of Edmonton, Alberta, who wound up traveling to an Oklahoma City hospital for a hip replacement, and Christina Woodkey of Calgary, Alberta, who had her spinal surgery performed by a Montana doctor. Both paid for their procedures out of pocket, at costs of $30,000 and $50,000, rather than wait a year or longer to undergo the same surgeries free of charge in Canada.

In Canada, the public and private sectors have moved to address the long surgical waiting list. In July, Alberta Premier Ed Stelmach acknowledged the increase in wait times for hip and joint surgeries after deep cuts in the province's medical budget, saying the government would soon address the issue, according to CTV News.

Private health care clinics have begun cropping up despite a Canadian law that makes it a criminal offense for a private provider to charge patients for medically necessary procedures. Doctors avoid breaking the law by going through a third party, such as Mr. Baker's company, to collect their fees. "The other way they get around the law is they say, 'This patient has been on a waiting list for three years for hernia or bunion surgery, so it must not be medically necessary,' " Mr. Baker said. "On the other hand, if you have a life-threatening condition such as cancer, you can't be treated in these private centers." Such clinics are increasing in number but still account for less than 1 percent of all surgeries, he said.

Supporters of the Canadian health care system remind naysayers that the majority of Canadians receive prompt, high-quality care at virtually no cost. Their neighbors to the south may opt to avoid treatment if they don't have adequate insurance. Canadian Sen. Grant Mitchell, a Liberal Party member who represents Alberta, spoke in Washington earlier this month to remind U.S. lawmakers of the Canadian system's virtues. "The reality is that our health care system costs less and delivers more, and each and every Canadian has health care coverage, regardless of their wealth or status," Mr. Mitchell said in a statement. "Further, and importantly, it acts as a competitive advantage in international competition for international investment and markets."

For Mr. Caldara of the Independence Institute, the issue goes beyond policy. His 5-year-old son, Chance, has Down syndrome and has undergone eight operations, including open-heart surgery to repair a hole in his heart. Under a Canadian-style system, Mr. Caldara said, Chance likely would have wound up on a waiting list and could still be waiting for life-changing or even life-saving procedures. "This is not about some wonky public-policy issue; this is personal," he said. "This is about saving my son's life."


Congressional liberals seek health-care access for illegals

Fearful that they're losing ground on immigration and health care, a group of House Democrats is pushing back and arguing that any health care bill should extend to all legal immigrants and allow illegal immigrants some access. The Democrats, trying to stiffen their party's spines on the contentious issue, say it's unfair to bar illegal immigrants from paying their own way in a government-sponsored exchange. Legal immigrants, they say, regardless of how long they've been in the United States, should be able to get government-subsidized health care if they meet the other eligibility requirements.

"Legal permanent residents should be able to purchase their plans, and they should also be eligible for subsidies if they need it. Undocumented, if they can afford it, should be able to buy their own private plans. It keeps them out of the emergency room," said Rep. Michael M. Honda, California Democrat and chairman of the Congressional Asian Pacific American Caucus. Mr. Honda was joined by more than 20 of his colleagues in two letters laying out the demands.

Coverage for immigrants is one of the thorniest issues in the health care debate, and one many Democratic leaders would like to avoid. But immigrant rights groups and the Democrats who sent the letters say they have to take a stand now. President Obama has said he does not want health care proposals to cover illegal immigrants. The bill drawn up by Sen. Max Baucus, Montana Democrat and chairman of the Senate Finance Committee, excludes illegal immigrants from his proposed health care exchange.

Mr. Honda and his allies, though, say illegal immigrants should be allowed to pay for insurance if they can afford it, even if it comes through a government-established exchange. As a generally young, healthy part of the population, illegal immigrants could help reduce overall costs for those who buy into health exchange plans, the lawmakers said. The Democrats' letters, however, do not issue ultimatums or threaten to withhold support for the bills if their requests aren't met.

The National Council of La Raza launched its own "flood their voice mail" campaign last week to put pressure on Mr. Baucus to expand coverage in his proposal to include all legal immigrants and to drop verification language in the legislation that would prevent illegal immigrants from obtaining coverage.

Mr. Honda told The Washington Times that he's not pushing for illegal immigrants to gain access to taxpayer-subsidized benefits. "That's an argument that's been done already," he said.

Rep. Steve King, Iowa Republican, said proposals that include government coverage for illegal immigrants leave him incredulous. "If anybody can, with a straight face, advocate that we should provide health insurance for people who broke into our country, broke our law and for the most part are criminals, I don't know where they ever would draw the line," he said. Mr. King, who opposes Democrats' health care plans in general, said illegal immigrant access in legislation "would be a poison pill that would cause health care to go down" to defeat.

Twenty-nine Democrats signed on to the letter on legal immigrants, while 21 signed the letter on covering illegal immigrants. Although the leadership of the Congressional Black Caucus signed the legal-immigrant letter in their capacity as CBC officials, they signed the other letter as individual members of Congress.

Under the 1996 welfare law overhaul, Congress restricted most federal benefits to longtime holders of green cards - those who have been in the country at least five years. But Democrats chipped away at that rule when they reauthorized the State Children's Health Insurance Program earlier this year and allowed states to cover all immigrant children and pregnant women, regardless of how long they've been in the country.

In their letter, the Democrats said health care costs are much lower for legal immigrants than for native citizens. "Immigrants are part of our families, our communities, our economy, and contribute to the fabric of America," they wrote. "It is simply wrong that their taxes would pay for public health insurance programs to which they are not allowed access." [How many pay taxes? Very few]


Max's Mad Mandate

The Baucus health bill will break 50 state budgets via Medicaid

The more we inspect Max Baucus's health-care bill, the worse it looks. Today's howler: One reason it allegedly "pays for itself" over 10 years is because it would break all 50 state budgets by permanently expanding Medicaid, the joint state-federal program for the poor.

Democrats want to use Medicaid to cover everyone up to at least 133% of the federal poverty level, or about $30,000 for a family of four. Starting in 2014, Mr. Baucus plans to spend $287 billion through 2019—or about one-third of ObamaCare's total spending—to add some 11 million new people to the Medicaid rolls.

About 59 million people are on Medicaid today—which means that a decade from now about a quarter of the total population would be on a program originally sold as help for low-income women, children and the disabled. State budgets would explode—by $37 billion, according to the Congressional Budget Office—because they would no longer be allowed to set eligibility in line with their own decisions about taxes and spending. This is the mother—and father and crazy uncle—of unfunded mandates.

This burden would arrive on the heels of an unprecedented state fiscal crisis. As of this month, some 48 states had shortfalls in their 2010 budgets totaling $168 billion—or 24% of total state budgets. The left-wing Center for Budget and Policy Priorities expects total state deficits in 2011 to rise to $180 billion. And this is counting the $87 billion Medicaid bailout in this year's stimulus bill.

While falling revenues are in part to blame, Medicaid is a main culprit, even before caseloads began to surge as joblessness rose. The National Association of State Budget Officers notes that Medicaid spending is on average the second largest component in state budgets at 20.7%—exceeded only slightly by K-12 education (20.9%) and blowing out state universities (10.3%), transportation (8.1%) and prisons (3.4%).

In some states it is far higher—39% in Ohio, 27% in Massachusetts, 25% in Michigan, Rhode Island and Pennsylvania. Forcing states to spend more will crowd out other priorities or result in a wave of tax increases, or both, even as Congress also makes major tax hikes inevitable at the national level.

The National Governors Association is furious about Mr. Baucus's Medicaid expansion, and rightly so, given that governors and their legislatures will get stuck with the bill while losing the leeway to manage or reform their budget-busters. NGA President Jim Douglas of Vermont recently said at the National Press Club that the Baucus plan poses a "tremendous financial liability" and doesn't "respect that no one size fits all at the state level." He added: "Unlike the federal government, states can't print money."

Mr. Baucus hopes to use his printing press to bribe the governors, at least for a time. Currently, the federal government pays about 57 cents out of every dollar the states spend on Medicaid, though the "matching rate" ranges as high as 76% in some states. That would rise to 95%—but only for five years. After that, who knows? It all depends on which budget Congress ends up ruining. Either the states will be slammed, or Washington will extend these extra payments into perpetuity—despite the fact that CBO expects purely federal spending on Medicaid to consume 5% of GDP by 2035 under current law.

As for the poor uninsured, they'll be shunted off into what Democratic backbencher Ron Wyden calls a "caste system." While some people will be eligible for subsidized private health insurance, everyone in the lowest income bracket will be forced into Medicaid, the country's worst insurance program by a long shot. States try to control spending by restricting access to prescription drugs and specialists. About 40% of U.S. physicians won't accept Medicaid at all.

Why? One reason is that Medicaid's price controls are even tighter than Medicare's, which in turn are substantially below private payers. In 2009 or 2010, 29 states will have either reduced or frozen their reimbursement rates to providers. Democrats love Medicaid because is it much cheaper than subsidizing private insurance, but that is true only because of this antimarket brute force. Of course, such coercion will be extended to the rest of the health market under ObamaCare.

The states aren't entirely victims here. Both Republican and Democratic state houses regularly game the Medicaid funding formula —which itself is designed to reward higher spending— to steal more money from national taxpayers. Then when tax collections fall during downturns, budget gaskets blow all over the place. This dynamic helps explain the spectacular budget catastrophes in New York and California. We'd prefer a policy of block grants, which would extricate Washington from state accounting and encourage Governors to spend more responsibly.

That's not going to happen any time soon, but the least Mr. Baucus can do is not make things worse. Instead, his Medicaid expansion is a disaster on every level—like the rest of ObamaCare.


Monday, September 28, 2009

Give market forces room to breathe, and costs will decrease

The dirty little secret is that "Obama-care" isn't about reducing healthcare costs or making coverage more secure. It's about robbing Peter to pay Paul.

How many young and elderly people can we rob to subsidize coverage for the uninsured? How can we leverage the 50% of health spending that government already controls to push payments below costs among the other 50%? How many special interests should we bribe along the way? (Answer: all of them.)

Supporters from President Obama right down to you assure us that consumers will come out ahead. The only losers, you assure us, will be the insurance industry.

The opposite is true: Democrats in Congress are taxing workers to pay off insurance companies. Democratic Sen. Max Baucus (D-Mont.) just proposed $774 billion in subsidies for private insurers. (Somehow, that's supposed to be more moderate than House Democrats' $773 billion in subsidies.)

The outrage at the August town halls came from voters realizing that under Obama-care, they're not Paul -- they're Peter.

"Almost every political pronouncement now emphasizes cost reduction as a central object of healthcare reform," writes Stanford health economist Victor Fuchs. "The policy recommendations that follow, however, frequently aim at cost shifting rather than cost reduction." Cost shifting, Fuchs reminds us, "does nothing to reduce the real cost of care."

Real reform would reduce costs by letting individual consumers control their healthcare dollars and choose their health plans. Eliminating the tax preference for job-based coverage would let workers control the $4,000 to $10,000 of their earnings that employers now control and choose secure coverage that stays with them between jobs. Converting Medicare to a voucher program, with larger vouchers for the poor and the sick, would protect seniors from government rationing.

Consumers will spend that money more wisely than employers or government ever could. They will drive costs down because they will personally reap the rewards.

Real reform would further reduce the cost of coverage by letting workers purchase coverage from other states. As Cal State Northridge economist Shirley Svorny suggests, real reform would also make medical services more affordable by eliminating barriers to competition by nurse practitioners and other mid-level clinicians.

Those two steps would not only increase competition and reduce costs. They would improve many dimensions of quality by helping the Kaiser Permanente model spread to other states. That sounds better than summarily kicking Kaiser out of Medicare Advantage, doesn't it?

Our healthcare sector is a mess. Countless Americans are suffering and dying -- yes, dying -- because well-intentioned government interventions are driving costs higher, blocking innovation and leaving us with insecure coverage.

Yet the greatest strength of America's healthcare sector is that it shows what competition can do when market forces are given room to breathe. What do you say we give market forces a little more breathing room?

But first, let's stop the kleptocrats and kill this insurance-company bailout.


BaucusCare: A NICE Alternative to ObamaCare

Viewed by some as a better alternative to ObamaCare because of its much-touted lack of the controversial Public Option, the Baucus plan may seem, with a little tweaking and fine-tuning, to be a promising route to a possible be-partisan compromise on Health Care Reform.

The Public Option in ObamaCare has given rise to fears of government rationing of Health Services. Could the Baucus Plan now lay them to rest? Clearly not everyone thinks so. One mainstream news commentator has remarked that Republicans in particular were staying away from it, in part because it would make significant cuts to Medicare, hurting Seniors.

Those fears are justified and wildly understated. BaucusCare launches an all-out frontal assault on Medicare and legally sanctions exactly the sort of rationing of health services most feared by those leery of the public option in ObamaCare.

Last week we observed that Comparative Effectiveness Research, which would recommend the provision of health services based on the results of a cost-benefit analysis, inevitably leads to rationing and denial of services. These and similar phrases thus become mere euphemisms for rationing.

Senator Baucus showed awareness of this on June 9th when he quipped before a Brookings Institution-sponsored conference that the phrase “Comparative Effective Research” may just sound a little too ‘ominous’ and suggested substituting a softer expression like “patient-centered outcomes research” in its stead. Or, he jokingly claimed, just call it “Fred.”

According to a December 2007 CBO Paper Entitled “Research on the Comparative Effectiveness of Medical Treatments,” now “under current policy and law, Medicare generally covers any treatment or procedure that has net medical benefits---that is benefits that outweigh the risks of the procedure---regardless of its costs….”(32).

Additionally “Medicare is effectively precluded from taking costs into account when making decisions about coverage” and would need “new legal authority”(29) to do so. The Baucus Plan would give Medicare exactly this authority.

And what it now gives to Medicare it would like to see extended throughout the whole health system. As pointed out in a White Paper outlining the essentials of BaucusCare entitled “Call to Action: Health Reform 2009,” “Many of the proposals in the plan are based in the Medicare program because of its unique ability to lead the way for system-wide changes.”(36)

To carry out the comparative effectiveness research, the Baucus Plan would set up the “Health Care Comparative Effectiveness Research Institute” as an independent entity shielded from Congressional or other government oversight.(56) It would perform functions similar to those of the British National Health Services’s “National Institute for Health and Clinical Excellence (NICE), namely assessing “the full spectrum of clinical interventions, including pharmaceuticals, medical devices, procedures, services and other therapies”(56) and making binding recommendations on its findings intended to guide clinical decisions by specifying a range of approved drugs and procedures. But, the CBO paper observed, “to reduce health care spending, the results of comparative effectiveness analysis would ultimately have to change the behavior of doctors and patients---that is, to get them to use fewer…or less expensive services.”(30)

To force doctors to fall in line behind the Institute’s recommendations, the Baucus Plan would change Medicare’s payment structure from the current fee-for-service [pay-for-reporting] reimbursement system to what it calls a “pay for quality” model(42) because it says the former offers doctors little incentive to work toward quality and efficiency improvements(49). The change would reward physicians for following the Institute’s recommendations and penalize them for not doing so, giving them a significant financial incentive for essentially rationing care.

Now, NICE is mentioned in the CBO paper as, “Perhaps the best known example of an agency that assesses comparative effectiveness….” (6) Yet, it is for others also the best known example of a rationing board, because of its practice of screening drugs and procedures for approval via quality-adjusted life years (QALYs), a decision procedure which decidedly favors the interests of the young over the old. It is for Sarah Palin the very paradigm of a “Death Panel.”

Thus, if you would like to see health care decisions in the US governed by a rationing board similar to that which governs them in the British National Health Service then, for you, BaucusCare is a NICE alternative to ObamaCare!


The second-best solution to health care: Do nothing

The second-best solution for the health-care crisis? Do nothing. Of course, that drives the interventionists crazy. “Do nothing?” they cry! “Don’t you realize that we’re in a crisis? We can’t afford to do nothing!”

What they fail to realize is a fundamental principle about interventionism: It produces more crises. Therefore, any new health-care intervention, whether termed “reform” or “modification” or “improvement” is only going to make things worse than they already are. New interventions will produce new and bigger crises, thereby producing calls for more “reform” in the future.

What ultimately happens is that as the crises and interventions grow in number and intensity, people get so frustrated that they end up supporting a complete government takeover of that particular segment of society. In fact, that’s already happening in the health-care debate.

So, if doing nothing is the second-best solution for the health-care crisis, what’s the best solution?

The answer to that question depends on figuring out the root cause of the problem. In a sense, that task is no different from that which a physician faces when an ailing patient comes to visit him. The doctor examines the patient, arrives at a diagnosis, and issues a prescription. The correct prescription usually depends on a correct diagnosis. Get the diagnosis wrong, and more often than not the prescription will be wrong.

It’s really no different in principle with ailments that afflict the body politic. Get the diagnosis wrong and it’s likely that the prescription will be wrong.

The diagnosis that interventionists have reached in America’s health-care crisis is that the crisis is caused by too much freedom and free enterprise in the heath-care arena. Thus, their prescription is not surprising: Socialism and interventionism.

The problem with this diagnosis, however, is that the diagnosticians fail to account for the critical factor in the ailment of the patient: massive socialism and interventionism in health care in the past. It simply never occurs to these people that those things could be the root cause of what ails the body politic — the root cause of the health-care crisis. To socialists and interventionists, it is inconceivable that socialist and interventionist programs are anything but positive, healthy things for a society. That’s why they consider them the medicine, not the source of the ailment.

That, of course, leads us to an opposing diagnosis — that it’s not freedom and free enterprise that have caused America’s health-care crisis but instead the socialism and interventionism that have infected every aspect of the health-care field.

First, on the demand side of health care you’ve got ever-growing Medicare and Medicaid expenditures, which have placed an enormous upward pressure on health-care costs.

Second, you’ve got massive government regulation of both the medical and insurance industries, adversely impacting both the demand side and supply side of health care.

Third, you’ve got income-tax manipulation that has perverted the market with respect to employer-provided health-care insurance.

Fourth, on the supply side of health care you have occupational-licensure laws, which have strictly limited the supply of health-care providers.

Therein lies the root cause of America’s health-care crisis. Thus, the prescription is obvious: radical surgery by removing all of this cancerous material from the body politic. No reform. Simply an immediately repeal of Medicare, Medicaid, health-care and insurance regulations, and medical licensure. End all government involvement in health care. Given the positive power of the free market and the enormous resiliency of human beings, the body politic will immediately begin recovering.

That is the only solution to America’s health-care crisis. But if Americans cannot bring themselves to rid the body politic of all this socialist and interventionist cancer, then the second-best solution is to do nothing at all. Because infecting the body politic with even more cancer will only make the condition worse.


Health Problems Health Care Can't Fix

President Obama and Michael Moore's inconvenient truth

Maybe President Obama has watched too much "Sicko" because he sure likes to reiterate Michael Moore's bromides. In his joint address of Congress, he said: "We spend one and a half times more per person on health care than any other country, but we aren't any healthier for it."

But as Mr. Obama is fond of saying, that simply is not true.

While Americans may have a lower life expectancy than other affluent countries, the disparity is mainly due to Americans' poor personal health-care practices -- not to any flaw in health-care treatment. "The U.S. actually does a pretty good job of identifying and treating the major diseases. The international comparisons don't show we're in dire straits," says University of Pennsylvania's Dr. Samuel Preston, a researcher who has studied the matter.

The real problem, it turns out, is that Americans are accident-prone, health unconscious slobs. Until the mid-1980s, the U.S. had the highest per capita cigarette consumption in the developed world, and the U.S.'s obesity rate today is more than twice that of Canada and ten times that of Japan. These aren't problems of the health care system (i.e. in the diagnosis and treatment of disease). These are problems of behavior. Adjust that data for the higher U.S. incidence of homicide and obesity, and Americans actually have the highest life expectancy in the developed world.

This is the kind of inconvenient truth that the somewhat lax Mr. Moore is accustomed to overlooking. A svelte gym rat like Mr. Obama should know better.


Death panels coming to Australia

Courtesy of a Leftist government, of course: The same folk who brought you eugenics in the first half of the 20th century. This already happens in England and is much feared by opponents of ObamaCare -- after evil Ezekiel proposed such measures

DYING cancer patients could be weaned off taxpayer-funded drugs as the Federal Government is confronted with spiralling health costs. Health Minister Nicola Roxon wants debate about the moral challenge as the Pharmaceutical Benefits Advisory Committee plans trials to determine when costly drugs become ineffective and should no longer be dispensed.

Talks between the PBAC and oncologists are part of a broader debate on how taxpayer money could be better spent, as doctors brace themselves for a rising tide of cancer patients, an ageing population and growing health expenses.

Ms Roxon is also believed to be talking to doctors and pharmacists about diverting patients to some cheaper generic drugs. It could spark greater competition and save the Government millions of dollars. [But see here]

Ms Roxon argues that relief from cancer drugs in the last months of life should not be underestimated, but says some are not cure-alls. "Would the community support looking at mechanisms to better control the use of these medicines so that they are only used when the evidence shows they are truly effective, balanced by greater investment in palliative care, so we can better meet the needs and preferences of patients at the end of life?" The question recently put to doctors in Sydney comes as PBAC chairman Lloyd Sansom stressed that moves to keep the Pharmaceutical Benefits Scheme sustainable would not impeach or impair patient safety. The PBS costs taxpayers $8 billion a year for more than 3500 subsidised medicines.

Prof Sansom said more information was needed. "We need trials to be done ... to address any advantages in continuing with drugs when the patient (cancer) has progressed. If there is any benefit," he said.

The Australian Medical Association vice-president Steve Hambleton said the issue was sensitive and some doctors had trouble saying "no" to patients. "If you're on your last legs, there's no point in having expensive chemotherapy if there's no clinical benefits," Dr Hambleton said.

But apart from cancer drugs - which can cost taxpayers up to $50,000 a patient - Ms Roxon is asking why doctors dispense expensive, subsidised drugs to patients when cheaper generics are prescribed.

Ms Roxon told The Courier-Mail yesterday the Government had to be smarter in how health dollars were allocated. "The current pharmacy agreement negotiations are very important," she said.


Sunday, September 27, 2009

Fears that NHS switch to cheaper drugs could put millions of British patients at risk of side-effects

Millions of patients could face life-threatening side-effects under a scheme which will swap branded drugs for cheaper versions. More than five million asthma sufferers and up to 500,000 with epilepsy could be hit by the change, while patients with conditions such as Parkinson's, bipolar disorder and hypertension may also be affected.

Pharmacists will be expected to substitute a brand of drug written on a prescription with a generic, cheaper version. For the first time, outside an emergency situation, they will not have to consult with a doctor to change a patient's prescription. The plan is expected to save the NHS up to £70million a year, but critics claim it may end up costing more in treating side-effects unless certain medical conditions are exempt from the rules.

Generic products are developed to cash in when branded drugs lose patent protection. Although generics are meant to be identical, the active ingredients can vary within an agreed percentage and inactive ingredients, such as colourings, may also differ.

In epilepsy even tiny changes in bioavailability - the amount of active medication absorbed into the body - can have serious consequences. NHS guidelines on epilepsy drugs currently warn against changing the brand for individual patients because of 'increased potential for excessive side-effects'.

Doctors claim it is vital the 5.4million asthma sufferers in the UK are protected from having their inhalers automatically switched to cheaper versions. Dr Mike Thomas, chief medical adviser to the Asthma UK charity, said: 'Patients should only be swapped to another inhaler in a face to face consultation with a doctor or nurse. 'Generic substitution means asthma control may be lost and asthma that is not well controlled puts the patient at risk of an attack. 'An opt-out scheme will not be good enough, we need asthma inhalers to be exempt from the regulations.'

And Simon Wigglesworth, deputy chief executive of Epilepsy Action, said a survey of members revealed around 10 per cent had suffered more seizures as a result of changes to their anti-epileptic medication. 'We know people's epilepsy gets worse after their medication changes and seizures are life-threatening,' he said. 'Epilepsy patients should receive the same version of an anti-epileptic drug whenever they get a repeat prescription, from the same manufacturer and the same country of manufacture. 'The only safe way to bring in this scheme is to exempt anti-epileptic medication. 'The financial savings to be made from prescribing generically rather than by brand may not outweigh the cost of extra A&E admissions and hospital stays.'

Other countries with generic substitutions allow doctors to tick a box to indicate that a branded drug must not be changed. Around 86 per cent of NHS prescriptions are already written for generic drugs and Britain has one of the lowest levels of spending on drugs per head of any developed country.

David Fisher, of the Association of the British Pharmaceutical Industry, said savings from using cheaper drugs must go back to the NHS.

A spokesman for the Department of Health said: 'Currently, there is nothing to prevent the prescribing of a particular generic or brand of drug if the prescriber considers it essential for the patient to receive a specific product. Our proposals for implementation of generic substitution will maintain this position.'


Northern Ireland public hospitals cannot afford treatment that patients need

Patients being treated in the Belfast Health Trust will no longer be referred to the private sector for operations because the Trust cannot afford them. Patients throughout NI are often referred to private clinics for knee, hip, heart and cataract operations, helping to reduce waiting lists. The trust's Chief Executive William McKee said the move was temporary but it would impact on waiting times.

The Vice Chair, Eileen Evason, said the health service was "in real trouble". She said: "I don't think we can manage financially. We cannot sustain the service unless we get help and get it soon." The Belfast Trust paid for 7,000 private operations last year and commissioned another 4,000 so far this year.

Mr McKee said: "It doesn't appear, at this stage, we have enough money to meet the activity we were able to do last year." He told BBC Radio Ulster: "This is hopefully a brief pause while we take stock of how much money is available and how much more we can do internally." He admitted that the trust was finding things "very difficult" financially and said hard choices would have to be made.

The Trust needs to save £130m over the next three years. Earlier this week it emerged it may cut 152 beds at two hospitals in the city.


Obamacare: Taxes for Everyone

Now that the various healthcare plans are being reduced to print, the financial details are emerging and with them a fundamental conclusion is becoming evident: The Obama plan is a giant tax increase for much of the American people (not just the rich).

Start with the mandate that falls on those whose welfare is the supposed object of the entire program -- the uninsured. According to the Congressional Budget Office, the average uninsured person or family will have to pay between 15 and 20 percent of his or their total income on health insurance (counting premiums, deductibles and co-payments) before any of the subsidy in the Baucus bill kicks in. Even in the more generous House bill, the tab that the uninsured must pay is very, very high.

Most uninsured would likely be quite happy to avoid paying this much of their income for health insurance. But they will be forced to shell out the money under the program. Others would want catastrophic coverage (which for the young would likely not be too costly) but the Obama program requires comprehensive insurance that is costly to satisfy the government requirement.

Having spent the entire campaign speaking about "affordable" coverage, it turns out the program is not at all affordable, but a massive new tax on the average uninsured American.

Then there is the tax on health insurance premiums that is to finance about a quarter of the subsidy for the uninsured. This tax, billed as only to be levied on "gold-plated" policies, will, in fact, reach down to the average American. The Baucus bill specifies that the tax of 35 percent would be put on all premiums over $8,000 for an individual and on proportionately higher premiums for families. Current estimates are that about one-tenth of the current health insurance policies would be taxable. But the $8,000 premium level that will trigger coverage is not indexed for inflation, let alone for medical inflation, which typically runs twice as high. ObamaCare will take effect in 2013. By then, the percentage of Americans subject to the tax will doubtless expand dramatically. Indeed, this trigger is a new Alternative Minimum Tax waiting to happen. As inflation pushes more and more Americans into tax eligibility, it will become a universal health insurance excise tax of 35 percent. While the tax will be imposed on health insurers and employers, it will, obviously, be passed along to the policyholders.

So if you are insured, you will increasingly have to pay 35 percent more for the privilege. And if you are uninsured, you will have to pay one-fifth of your income in premiums, deductibles and co-payments before any subsidy kicks in.

And then there is the final piece of the puzzle -- the $500 billion cut in Medicare that will pay for the bulk of the subsidy under the bill. We are literally slicing services to the elderly in order to transfer healthcare to others. Obama's claim that only "waste and inefficiency" in Medicare will be cut is, at best, disingenuous. Most of the cuts will be in reimbursement for doctors and hospitals. That will lead to less care, shorter office visits, fewer tests, fewer surgeries and less care. And it will lead to fewer doctors. As a result, a survey by the Investor's Business Daily indicates that 45 percent of all doctors would "consider retiring or closing their practices" if the Obama bill passes. The result will be a greater scarcity of medical services, even as the patient load expands by at least 30 million people.

Each of these fiscal pieces is movable. The left will pressure Obama to increase the subsidy to the uninsured. But that will necessitate raising the Medicare cut borne by the elderly or increasing the tax on health insurance policies -- or adding to the deficit. Any of these options will alienate moderate senators. Balancing these competing priorities only works if the taxpayers don't know what is going on.

If the average middle-income American family realizes that it will have to pay one-third more for health insurance or the uninsured learn that they will have to pay a fifth of their income to get insurance, they will make their dissatisfaction felt by their Democratic senators.

All of which begs the fundamental question: How willing are Democratic congressmen to commit political suicide? Are they willing to lose the elderly and to antagonize the uninsured as the health insurance cops chase them around the block? When does JFK's comment kick in: "Sometimes party loyalty asks too much"?


Don't want Obamacare? Go to jail!

This doesn't happen often enough.

Sen. John Ensign (R-Nev.) received a handwritten note Thursday from Joint Committee on Taxation Chief of Staff Tom Barthold confirming the penalty for failing to pay the up to $1,900 fee for not buying health insurance.

Violators could be charged with a misdemeanor and could face up to a year in jail or a $25,000 penalty, Barthold wrote on JCT letterhead. He signed it "Sincerely, Thomas A. Barthold."

The note was a follow-up to Ensign's questioning at the markup.


Is emergency care a failed market?

In response to my recent article on health-insurance mandates, I received many emails from readers who argued that mandates, as unappealing as they may be, are necessary to prevent market failure in emergency medical services.

Specifically, they argued that there is a "free-rider problem" in emergency care because individuals are currently able to visit the emergency room (ER) without insurance or the means to pay, receive care, and then skip out on the bill. Such free riders force the hospital to either accept the losses or spread the costs to other patients. Therefore, the readers reasoned, there is a market failure in that health insurance is under-demanded and ER care is over-demanded, increasing health care costs and dumping them onto those consumers who do purchase insurance and pay for their visits.

As accurate as this common depiction of the symptom is, however, it misdiagnoses the disease. The free-rider problem in ER care is not a market failure, but a government failure. The Hippocratic Oath notwithstanding, hospitals only accept all patients irrespective of their ability to pay because they are required to by government regulations. These laws, which are in place in countries around the planet, result in a simple welfare scheme whereby the costs of the uninsured are transferred to insured patients. With this reality in mind, it is easy to see that the free-rider problem in ER services is not a market failure, but rather a government failure.

How, then, would truly free-market hospitals handle patients who are now free riders? There is every reason to expect that these uninsured, mostly low-income people would be treated more humanely and with greater dignity than they are in the current quasi-socialist system.

Without government regulations on their payment collection methods, hospitals would be free to offer more flexible prices and payment options, and to negotiate contracts with individual consumers. Those patients with little financial leverage would be able to form creative payment plans, and those without any savings or insurance could even contract to pay for their services with labor.

Furthermore, in a truly free market for medical care, even patients who intentionally try to skip payments and thus dump the costs on others cannot. This is because, in the absence of supposedly compassionate hospital legislation, to admit oneself or someone else to emergency care is to agree to the terms and conditions of service at that hospital — most importantly, to pay for treatment.

Thus, in the libertarian society, checking out without arranging payment would constitute a violation of contract, and therefore these malicious free riders would be held accountable. In the current situation, however, such predatory patients are subsidized by others in the name of social compassion.

Another advantage of contractual enforcement of payment for ER services on the free market is that it removes hospitals from financial responsibility for those patients who are admitted to the ER by another party while incapacitated. Which party will be held responsible for the hospital bill in each case would be decided by negotiation between the two parties and perhaps even by court arbitration. Which party eventually pays is not important for this matter, though; what matters is that the hospital will be paid either way, and that other patients will no longer be stuck with the bill.

Now that we've seen that the free-rider problem does not exist in a free market for medical care, we can address other readers' concern that the profit-driven market process is unsympathetic to the suffering of those patients who are truly unable to pay in any way and can't afford market insurance, but who shouldn't simply be left to suffer.

To argue that the market discards those it regards as undesirable is to both ignore the prevalence of private charity and deny the existence of the entire public-relations industry. Indeed, setting socialist doctrines aside, we can see that affectionate treatment of the poor and downtrodden is actually a very profitable endeavor.

In every market, firms of all sizes expend resources to maintain a positive public image. There are few actions better received by a community than healing and treating their vulnerable and disabled at a discounted or zero price. As such, it is absolutely foolish to believe that hospitals would not take in such customers for treatment.

In fact, if we examine the nature of prices and income differentials closely, we arrive at another instance of destructive government intervention. Price discrimination of almost every form is illegal in almost every market, and health care is certainly no exception.

Price discrimination may feel unfair, but if allowed by law it can lead to much more efficient market outcomes and higher market quantities of all goods and services. Using price discrimination, hospitals would be free to provide additional and cheaper services to low-income consumers without decreasing the price for high-income consumers.

Price discrimination would benefit the hospitals as well, because they would not only increase the quantity of services they perform and add potentially loyal new customers, but would also be able to increase the price of services to their high-income patients without losing their business.

Viewing the converse of this market outcome, then, we can observe that laws against price-fixing necessarily decrease quantities of goods and services, and squeeze marginal consumers out of the market. In the health care market, this means that those who are most in need of low-cost care are forced out of the market in the name of social justice.

In contemplating competition between medical service providers, we can deduce that the market will indeed treat people who are now free riders with dignity, but that those consumers will no longer actually be free riding on others. Instead, they will provide a valuable good to society — namely, the satisfaction that comes with supporting others in their time of need. While it may seem strange to think of this as an economic good, it certainly is, as evidenced by consumers' willingness to forgo other forms of consumption in favor of charity.

While caring for these patients would still redistribute costs to other consumers, it would do so only to the extent that these paying consumers would tolerate it by continuing to purchase care and services. That is to say that consumers' choices between competing hospitals' services would, just as in any market, force those hospitals to provide equilibrium quantities of charitable care.

This efficient market quantity would therefore be determined by the charitable inclinations of insured and higher-income patients. And in a truly libertarian market, which would lack taxes, we can say that these individuals would inarguably be more giving of their own income.

Perhaps the best feature of the free-market process in a libertarian health market is that it would allocate charitable funds to their best use. In our emergency services case, this axiom of market behavior implies that hospitals will spend their charity budgets on the most destitute and impoverished patients.

Whereas government funds are allocated according to political cronyism and electoral opportunism, free-market hospitals will always attempt to maximize the benefit to their public image — nothing more than profit maximization — by providing for those patients who are most in need.


With rigorous examination, we can see that emergency medical services function like any other market, and that the free-rider problem is the result of a government failure. Furthermore, we can safely expect that the free market would treat the most deserving of these free riders more humanely than does the supposedly compassionate central health administration.


Obama’s New Claim That 30 Million 'Cannot' Get Health Insurance Not Supported by Census Bureau

In his Sept. 9 speech to Congress, President Barack Obama unveiled a new claim that 30 million Americans “cannot” get health insurance, but this statistic is not supported by the government's latest definitive data produced by the Census Bureau on Americans lacking health insurance.

In his speech to Congress, Obama said, “There are now more than 30 million American citizens who cannot get coverage” – presumably taking into account conservative critics’ observation that Obama's earlier claims that 46 million Americans lacked health insurance was contradicted by Census Bureau data that indicated that more than 9 million of that number were not in fact U.S. citizens.

In a Sept. 10 blog posting, Office of Management and Budget (OMB) Director Peter Orszag explained the president's new claim that 30 million Americans "cannot" get insurance, saying that the figure was based based on Census Bureau data.

That study, “Income, Poverty, and Health Insurance Coverage in the United States, 2008,” was released Sept. 10 as part of the Annual Social and Economic Supplement (ASEC) to the Current Population Survey (CPS). “With the two different numbers, there has been some confusion as to which is accurate,” Orszag wrote. “Well, both are--and the President’s version is more focused on the relevant target population for health reform since it excludes unauthorized aliens. “The Census report indicates that of the 46 million uninsured individuals, 34 million were native born and 2.8 million naturalized citizens. The report thus shows that there were 36.8 million uninsured U.S. citizens (native born and naturalized) in 2008.”

Orszag explained that Obama was merely playing it safe and using a lower-than-reality figure in his speech. “To be conservative, the President thus stated that ‘more than 30 million American citizens’ cannot get coverage.” While that explanation accounts for why Obama used the figure of “30 million," it does not account for why he claimed those 30 million "cannot" get insurance coverage.

The Census Bureau report cited by Orszag does not contain any data about why people don’t have health insurance. It does not distinguish between people who cannot get health insurance and people who freely decide not to get it. The only question it asks is whether or not a person had health insurance during the previous year. If someone had coverage for part or all of the year, the Census Bureau counted them as “insured”--if they didn’t, they were counted as “uninsured.”

The Census Bureau also says that insurance coverage is often underreported, with people more likely to answer “no” if they are currently without coverage even if they were covered for part of the previous year--meaning they should have answered “yes.” “[H]ealth insurance coverage is underreported in the CPS ASEC for a variety of reasons,” the Census Bureau noted. “For example, some people may report their insurance coverage status at the time of their interview rather than their coverage status during the previous calendar year.”

In fact, a spokesperson in the Census Bureau’s health insurance division told that there is nothing in the health insurance report that has anything to do with why people are uninsured. “There isn’t. The survey that that report is based on, the Current Population Survey, doesn’t ask any questions about why [people lack coverage]. We really don’t ask any questions about why.”


Saturday, September 26, 2009

Australia: Another government hospital doesn't give a damn

WHEN the family of Emilia Chatterjee complained to Gosford Hospital that she had contracted an infection after being left in urine-soaked clothes, the hospital apologised to the 84-year-old and said the issue had been addressed. The only problem was that Mrs Chatterjee was dead.

In a shocking bungle that heaped insult upon injury, the hospital acknowledged that staff had not cleaned rooms as they should have, nor listened to the requests of her daughters, who were forced to maintain a round-the-clock vigil on their mother to ensure she was looked after.

The family said nurses told them that the urine she was left to lie in had given her an infection - one that took her life on August 28, seven weeks after she entered hospital.

Yet when the Central Coast Health Service wrote three weeks later to say the issues had been addressed it was clearly under the impression that the great-grandmother was still alive. "The Nurse Unit Manager has asked that I extend her apologies to you and Mrs Chatterjee for any distress caused as a result of the actions of nursing staff," CCHS divisional manager Andrew Roberts wrote.

Mrs Chatterjee's daughter Giorgina Neilson said the family was horrified at the conditions her mother was in. "The hygienic condition of the hospital was totally unacceptable. We were horrified," she said. "She wasn't being fed, she wasn't being cleaned regularly . . . The hospital did acknowledge, some of the nurses did acknowledge to my sister that it was because she lay in the urine that she got the infection."

Yesterday the State Government was again forced into a grovelling apology. "Central Coast Health general manager Matt Hanrahan extends his sincere apologies on behalf of the health service for the distress experienced by the family of Mrs Chatterjee," it said in a statement. "Mr Hanrahan said that the failure to acknowledge the death of Mrs Chatterjee in correspondence with the family related to concerns regarding her care was regrettable."

The bungle was also a baptism of fire for new Health Minister Carmel Tebbutt, who yesterday ordered a full departmental investigation.


Snowe to Reid: Whats the Rush?

Harry Reid is once again threatening to invoke reconciliation, whereby only 51 instead of 60 votes would be needed to pass the government-run health care proposal, ObamaCare. Apparently, the democratic system is not working fast enough for Reid’s taste. This time, Reid has threatened to eliminate the filibuster should Republicans halt consideration of the bill in committee. “If we can’t work this out to do something within the committee structure, then we’ll be forced to do reconciliation,” he said, calling the tactic a “last resort.”

“Railroading” might be a better term. However, the haste that Senate Democrats want to move on Senator Max Baucus’ public-private insurance “co-ops” proposal —which would provide taxpayer-subsidized health care to 26 million— has Olympia Snowe scratching her head.

As the Senate Finance Committee prepared to vote on a measure that would have required the language of the bill to be posted online prior to a committee vote (which would have given the Congressional Budget Office (CBO) time to properly estimate the cost of the bill) she actually got angry at her Democrat colleagues who refused.

Said Snowe with no small amount of displeasure, "I truly do not understand the skepticism about this request, the reluctance and the reticence. This is about doing our job. If it takes two more weeks, it takes two more weeks. We're talking about trillions of dollars in the final analysis. What is the rush? Is there something happening in two weeks?"

She might justifiably have added the word “bums”—as in, “What’s the bum’s rush?”

According to the CBO, a reliable cost estimate of the bill will not be quantifiable without the final proposed language, as opposed to the conceptual language the committee normally works with. Nonetheless, in a party line vote of 13-10, the committee agreed to only give the CBO the conceptual language, which would likely throw cost estimates off, according to the CBO.

The icing on the cake is Harry Reid’s thuggish threats to Senate Republicans to invoke reconciliation if they do not vote the legislation out of committee—despite the fact that neither they nor Reid has any idea about how much it will actually cost.

In recent weeks, Reid has threatened to use reconciliation repeatedly. At one point, Reid spokesman Jim Manley said, "The White House and the Senate Democratic leadership still prefer a bipartisan bill. However, patience is not unlimited, and we are determined to get something done this year by any legislative means necessary."

Senator Minority Leader Mitch McConnell predicted a public backlash if the bum’s rush tactic were used. He said, “Let me say…budget reconciliation has never been used to structure one-sixth of the American economy. If that option were chosen, there would be a severe, negative, and I think appropriate reaction from the American people… If you thought the American people were upset in August, you haven’t seen how upset they will be if this device is chosen.”

McConnell is not off-track. Some 56 percent of Americans currently oppose Democrats’ health care proposal, according to Rasmussen Reports. If Democrats now choose to eliminate the time-honored filibuster to nationalize the health care system, the consequences will be dire, both for Democrats, and for the country.

The filibuster has been used as a means of giving the minority party in the Senate a voice. It has been an effective tool for slowing down debate and allowing cooler heads to prevail for more than 150 years. Without it, a majority party could rule things like a mob. Which is what Reid apparently intends to do.

Senate Republicans need to answer in kind. They should make a threat of their own to Harry Reid: If he invokes reconciliation on ObamaCare, they will shut down and boycott the Senate altogether. Then the Senate will not work as fast as the Obama-Reid Cabal wants. In fact, it will not work at all. And the nation can heave a great sigh of relief.


Health plan would push millions out of Medicare program

President Obama's repeated pledge that senior citizens would not lose benefits under his proposed cuts to Medicare has been officially contradicted by an independent congressional analyst whose dire prediction could put the latest Senate health proposal in jeopardy.

The $856 billion health care reform bill now being drafted in the Senate Finance Committee would be paid for in part by slashing $125 billion from the Medicare Advantage program, which is used by about 9 million people, or nearly 20 percent of all Medicare recipients.

The cuts would come from the additional benefits Medicare Advantage enrollees receive, Congressional Budget Office Director Doug Elmendorf told the committee, and would amount to reducing those benefits by "a little more than half."

Under Elmendorf's estimates, Medicare Advantage enrollees would receive about $42 monthly in additional benefits in 2019 under the current health care proposal, not the more than $84 in benefits they would get without the cuts.

As a result, Elmendorf said, about 20 percent of Medicare Advantage users, approximately 2.7 million, would drop out of the program and would instead use standard Medicare.

Medicare Advantage refers to the various private health care options available through the government-run Medicare system. Often, Medicare Advantage plans include prescription drug coverage and other benefits. Generally, Medicare Advantage plans feature more benefits and lower co-pays than standard Medicare coverage, but include limitations on which doctors and hospitals a patient can visit. Insurers have warned that premiums may go up for seniors enrolled in Medicare Advantage under President Obama's health care reform proposal. The president has promised seniors will continue to receive the same level of coverage after reform is passed.

"Because the competitive bidding process would reduce the benefits that would be made available, fewer would choose Medicare Advantage and more would choose fee-for-service," which is standard Medicare, Elmendorf said.

One Democrat, Sen. Bill Nelson, of Florida, will offer an amendment to protect Medicare Advantage benefits, and at least one other Senate Democrat may be prepared to vote against the bill if the cuts go through. That could put passage in jeopardy, because no Republicans on the panel are likely to back the plan.

"I have real doubts that Congress ultimately will take as large a cut out of Medicare Advantage," said Joseph Antos, a health care scholar at the free-market American Enterprise Institute. "You are going to take 20 percent of the Medicare population, who are probably more active voters than the average Medicare beneficiary, and tell them that you can't have what you had last year. President Obama is telling you you can't keep what you want."

But without making drastic cuts to Medicare, Democrats are left without enough money to fund the massive reform plan.

"If they don't make the cuts, where are they going to get the $120 billion?" said Bob Laszewski, president of Health Care Policy and Strategy Associates. "There is pretty good agreement about what the benefits of health insurance should be, but where there really isn't agreement is how they are going to pay for it."


Doubling Down on a Flawed Insurance Model

Obama's plan takes the problems of the current system—mandates, runaway spending and more—and makes them worse

"What this plan will do is make the insurance you have work better for you. . . . And here's what you need to know, I will not sign a plan that adds one dime to our deficits—either now or in the future. Period."

So spoke President Barack Obama in his address to Congress earlier this month, for the first time laying out more specific goals for health-care reform. To persuade the American people to support his health reform agenda, the president has made two simple promises. First, his plan will benefit everyone who already has health insurance. Second, his plan will not add to the nation's yawning budget deficit. Both claims are essentially false, and examining them offers economic lessons for reform.

The administration's plan will impose mandates that employers provide coverage, mandates that individuals obtain coverage, and mandates about the form this coverage will have to take. These will remove the freedom to choose one's health-insurance plan, because government, in its effort to correct perceived inequities, will dictate which health-care services must be covered and which health-care providers must be used.

The proposed unprecedented intrusion of government into private markets will have adverse effects on people with insurance in both the short and the long run.

The mandates will lead to large increases in the cost of health insurance for everyone. Research studies have shown that as people become insured, especially under a health plan that offers broad coverage and low copayments, they consume more health-care services. The best estimates indicate that each newly insured person will approximately double his or her health spending.

With 30 million to 40 million newly insured persons under the administration's plan, aggregate health-care demand will increase significantly. But when demand expands prices increase. We estimate that the higher demand will increase health insurance premiums for the typical family plan by about 10%. Because an employer-sponsored family insurance plan cost $12,680 in 2008, this translates into an increase of about $1,200 in the typical annual premium.

The mandates will also have adverse additional longer-run consequences. According to provisions in both House and Senate bills, mandated plans must have low copayments and provide coverage of health-care services that is at least equal in scope to a typical, current employer-sponsored plan. But these are the very flaws that are responsible for high and rising health-care costs, flaws that stem directly from the misguided tax exclusion for and the extensive state regulation of health insurance. By locking in these flaws, the mandates will inhibit precisely the innovation needed to reform U.S. health care. Ultimately, as government seeks to rein in costs, it will curtail access to health-care services by erecting barriers between patient and health-care provider.

The current House and Senate bills will also break the president's second promise—not to add to the deficit. In part because the health insurance that the administration's plan forces people to buy is expensive, the plan proposes to give individuals large financial subsidies to partially offset the cost. The entitlement-based subsidy, combined with the proposed Medicaid expansion, would add between $700 billon and $1.2 trillion to federal spending over the next decade, according to the Congressional Budget Office. The new entitlements would come on top of existing federal health-care entitlements that the government has been neither able to control nor finance.

A portion of the additional spending is to be financed by savings from the existing federal health-care programs. But, thus far, the alleged savings come mainly from cutting future Medicare payment rates. If history is any guide, the savings won't materialize.

For the past 25 years, Congress has repeatedly "cut" payment rates. Yet Medicare's expenditures have continued to outstrip its dedicated revenues. New taxes have been required but revenues still can't keep up with expenses. Recall that in the early 1990s Congress removed the cap on Medicare's taxable wage base. Today, the Medicare Board of Trustees projects that the Hospital Insurance Trust Fund will be bankrupt in eight years.

More important, cutting payment rates is not reform. Ultimately, such price controls will lower the quality of health care and reduce the supply of health services, just as price controls have in every market where they've been tried. Congress's near-exclusive reliance on such cuts is revealing. It is a clear demonstration that the federal government has no idea how to reform its current insolvent health-care programs, much less how to properly design a new one.

Reform will be partly financed by higher taxes. The House bill proposes to raise the highest personal income tax rate by 5.4 percentage points. This is on top of the Obama administration's plan to raise the top rate by another 4.6 percentage points next year. The combined 10-percentage-point increase raises the top income tax rate to 45%—an economic growth-destroying level not seen since the early 1980s. Sen. Max Baucus (D., Mont.) proposes, instead, to tax some health insurance premiums.

In neither bill do higher taxes finance the proposed additional spending. Should the Medicare savings fail to materialize, as we believe they will, the spending in either bill will add more than $100 billion per year in perpetuity to the already soaring national debt.

Returning to President Obama's address: "We did not come to fear the future. We came here to shape it." But shaping needs a well-thought-out plan. To move forward, the country must begin to have two separate debates. The first debate centers on how to improve current health insurance arrangements in order to rein in the epidemic of health spending that too often fails to provide good value for money.

The second debate should center on additional steps to improve access to health care for those who cannot afford it. However, this debate must be separated from the issue of insurance coverage. Many currently insured Americans, no doubt, would be willing to pay some additional amount if extending health insurance coverage actually improved the health of the uninsured.

The hard reality is that there exists little evidence that it does. Helen Levy and David Meltzer, in a 2008 review of research in the Annual Review of Public Health, summarize the overwhelming conclusion of academic research by concluding: "The central question of how health insurance affects health, for whom it matters, and how much, remains largely unanswered at the level of detail needed to inform policy decisions." We must experiment with alternatives, such as further expansions of community health clinics, special assistance for the chronically ill, and other programs that might not supply traditional services but could have a big impact on people's health.

Comprehensive, low-deductible, low-copayment insurance has brought us to where we are today. The administration's plan to expand and lock-in this flawed paradigm will ultimately defeat the goal of making health services more affordable for everyone. Fortunately, there are other options, many of which have appeared on these pages. These include policies that encourage more cost-conscious health-care choices, greater competition among health insurers, and reduce the practice of defensive medicine.

President Obama claims to support these ideas, but the plan he outlined is not consistent with these claims, and neither is the Senate Finance Committee bill. The American people should ask for a second opinion.


Bad Medicine: ObamaCare is hazardous to your health


President Obama addressed Congress two weeks ago on the issue of health care, and on the same day an Associated Press GfK poll showed that the proportion of Americans who strongly approve of the way he is doing his job has fallen from 41% in December to 24% now. And the percentage of people who strongly disapprove of his performance has risen from 6% to 35%.

Those serious declines no doubt have to do with many issues--economic decline, the massive spending increases (enacted and proposed) of $6.5 trillion over the next decade, the coming massive tax increases that are presidential and congressional priorities, and currently most important, the proposed governmental takeover of health care. On that matter, more than 1.3 million people have signed and sent to Congress the Salem Radio Network's Free Our Health Care Now! petition to make sure individuals, not the national government, make their health care decisions. (Disclosure: The petition incorporated information form the National Center for Policy Analysis, of which I am chairman.)

But the Democratic congressional leadership, led by Sen. Max Baucus of Montana, has now offered a bureaucratic, government-intrusive health care proposal. The details change daily as the bill works its way through the Finance Committee, which Mr. Baucus chairs, for there are more than 500 proposed amendments being considered. But the bill would start off by imposing annual fees of $6.7 billion on health insurance companies, $4 billion on medical device producers, $2.3 billion on drug manufacturers and $750 million on clinical laboratories, all of which would surely be passed on to consumers in higher prices. The insurance companies' $6.7 billion fees alone would come to some 60% of the industry's after tax earnings.

And then American families who do not have health insurance--the people the Democrats claim they're trying to help--would be assessed finds of between $750 to $1,900 a year. All this reflects Congress's simple objective: government rather than individual control of our health care.

But America's health care is not doing badly. Indeed a National Center for Policy Analysis study from last March shows how much better we are doing than countries like Canada, Britain, and other European nations that have government health care control:

* Breast-cancer mortality is 52% higher in Germany and 88% higher in Britain than in the U.S.

* Prostate-cancer mortality is 457% higher in Norway and 604% higher in Britain than in the U.S.

* Eighty-nine percent of middle-aged women in the U.S. have had a mammogram, compared with 72% in Canada.

* Fifty-four percent of men in the U.S. have had a prostate-specific antigen test, compared with 16% of Canadian men.

As for the availability of health care, another study shows that 74% of those in the U.S. meet for scheduled doctors appointments within four weeks, while only 42% of British and 40% of Canadians do. Only 10% of Americans wait longer than two months, while 33% of Brits and 42% of Canadians wait that long.

On average, doctors in a survey say neurosurgery should be performed within 5.8 weeks, but in Canada it takes about 31 weeks. And orthopedic surgery should be within 11 weeks, but in Canada it takes 37 weeks. So it is pretty clear that government health-insurance monopoly is dangerously inefficient.

The government-operated Baucus plan would impose big costs on Americans, in terms of both money and freedom..

First there is the original proposal of a 35%--since raised to 40%--excise tax on companies that offer health-care plans that cost more than $8,000 for individuals or $21,000 for families, just to make sure that government can control costs and health care plan contents.

The individuals' cost of the required Baucus health care plans are very high, As The Wall Street Journal pointed out the other day, for a family of four making $42,000 the "government would subsidize 80% of their premium and pay $1,500 to offset cost-sharing," but the family would "still pay $6,000 a year--or 14.3% of their total income." As family incomes slowly rise, so would their health care costs--to 17% or 18% of income. In committee, the subsidies will likely be increased, but the individual's cost will still be too high.

The plan would cut some $500 billion from Medicare and Medicaid, including the excellent Medicare Advantage plan that gives 10 million senior citizens private health-care options. Giving choices to seniors is simply an anathema to government-control believers.

The federal government would also likely follow the lead of states and impose a list of benefits that must be included, even if all patients don't need them. There are now about 2,100 state-based mandates, for such services as acupuncture, wigs, massage therapy and in vitro fertilization.

Finally, Mr. Obama also believes in community rating, a requirement (already existing, in one form or another, in 11 states) that limits the differences in what companies can charge people for their coverage, regardless of their age or medical condition. That means younger, healthy people would pay much more than their care would cost--yet they would pay big fines if they don't take this bad bargain.

So what is a better solution? First, allow everyone to purchase health insurance across state lines (difficult under current law, as you must buy your insurance in your own state), so that they can get the best possible policies at the best possible prices.

Second, individuals should get the same tax break that companies get when they supply health insurance for their employees. All policy payments should be tax deductible, either to the company or the individual.

Third, health insurance should be portable. Companies should help their employees own their own insurance so that it travels with them from job to job, state to state, and is under their control.

Fourth, Congress should enact tort reform so that doctors can do what is best for their patients instead of practicing costly legal defensive medicine.

And finally, let people purchase insurance that meets their needs, rather than requiring intrusive, one-size-fits-all federal government mandates.


Senate considers aiming low on health care

As a deadline to pass a health care bill gets closer with no end in sight to the discord in Congress, some lawmakers want to scrap the proposals that are now on the table and try to pass a much smaller bill. "People feel that it may be very hard to get such a large bill done this year," said Sen. Joe Lieberman, I-Conn., after a closed-door meeting with Senate Democrats.

Lieberman said many Democrats appear "open" to the idea of trying to pass a far less ambitious legislation than the $900 billion plan on the table in the Senate Finance Committee, where lawmakers have lined up more than 500 amendments in an attempt to reshape the bill. "We've never adopted a reform package this large in one legislative act," Lieberman said. "We ought to begin this year putting parts of reform in and then make it better and better as time goes on. More than one senator suggested that as a possibility."

With just weeks remaining on the legislative calendar, both the House and Senate may ultimately have little choice but to take up a smaller bill. In the House, Speaker Nancy Pelosi must merge three similar, $1 trillion bills into one piece of legislation that that can garner the 217 votes needed. But she has no plans of bringing it to the floor yet, which would require twisting the arms of her skittish Democratic moderates and freshmen who have problems with the bill. Instead, Pelosi will wait and see if the Senate can pass a bill and then try to pass House legislation around the same time, a leadership aide said.

But Pelosi may have to wait a while for the Senate. Even after the Senate Finance Committee gets through its giant stack of amendments, Majority Leader Harry Reid, D-Nev., will have to find a way to combine the bill with a much more liberal and partisan health care proposal passed earlier this summer by another committee, and that final product must win the support of all 60 Democratic votes (Massachusetts is likely to soon appoint a Democratic replacement for the late Sen. Edward Kennedy), or alternatively pick support among a few Republicans.

Some Democrats are beginning to think it may be an impossible task. "I suggested that earlier this year we ought to take up something incrementally, because of the challenge," Sen. Ben Nelson, D-Neb., said. Nelson and other Democrats agree that Congress has to pass some kind of health care reform this year, even if it is a much smaller plan. Nelson suggests first passing a bill aimed a bringing down the cost of health care, which many Democrats in the closed-door meeting on Tuesday said is the biggest priority. If a bill is whittled into something smaller, the end product would focus on medical costs.

Reid repeated a warning that he may use a procedural move to pass a health care bill with just 51 votes, which would require breaking up the bill. He cited the need to bring down health care costs as the reason for the urgency. "Too many people waited too long for Congress to rein in skyrocketing costs, and we have to do something about it," Reid said. "That's what the debate's all about."