Tuesday, April 2, 2019

What the hell do we have to lose?

If you live or work in Washington DC, your number one health care question is how do I (or my meal ticket people) win the next election. If you live or work in Caruthersville MO, chances are that your most pressing health care question is how do I (or my immediate family members) get a hold of some insulin this month. Theoretically speaking, in a healthy democracy, the answers to both questions would be one and the same. In America, in the year 2019, this is no longer the case.

The Washington jetsetters most aligned with the Caruthersville culture (whatever that means), will pop up on your TV screen promising at least fifty insulin shops on Main Street, all competing for your insulin business, until insulin prices plummet to gas station coffee levels. Not to be outdone, the opposing Washington faction, will promise you free insulin for life, and to sweeten the deal, they will throw in free college for your semi-literate children who couldn’t pass a college entrance exam with a gun to their head. They will also promise free childcare for your grandkids, so just in case your daughter does not make it into that free college and does not become an astrophysicist as planned, she can still pursue her Walmart career.

We are being hoodwinked. We are being robbed. We are being disrespected and infantilized. Stealing our votes has become easier than stealing candy from babies. There are more of us by orders of magnitude than there are of them. They certainly have better and bigger weapons. They are better trained and better organized and have better discipline. We also have collaborators in our midst, who are difficult to spot. Let’s face it, in every conceivable way, Washington DC and its sprawling appurtenances have become what the Court of St. James was to our forefathers.

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Health care is complicated because it has so many degrees of freedom, few of which we can reliably identify. Some degrees of freedom are yet to be discovered, others look independent, but are not, and vice versa. Furthermore, the boundaries of what we call the health care system are ill-defined and in a perpetual state of flux. At our current state of knowledge, deterministic theories of health care systems are not possible, i.e. you cannot infer past states or future developments of the health care system based on its current state, which is why both health care historians and “futurists” consistently fail to produce any valuable insights, let alone solutions.

Option One

The first and most common strategy for changing complex systems is to essentially ignore the complexity, zero in on one’s pet peeve, kick it hard in the shins, and hope for the best. That’s what LBJ did in 1965 and that’s what President Obama did in 2010. One was wildly successful, the other less so. Why? Both LBJ and Obama identified a segment of the population driven into misery and poverty for lack of affordable medical care and passed legislation to have the government assume financial responsibility for their medical care, to various degrees. Both LBJ and Obama faced militant opposition to their proposals. Both had to compromise and twist arms to make it happen.

However, the health care system wasn’t nearly as complex when LBJ acted on it. As luck would have it, LBJ was able to separate a piece of the system from the whole in a relatively clean way and move on that piece and that piece alone. It would take half a century for the ripple effects of LBJ’s kick in the shins to reach all other parts of health care, for better or for worse. By the time Obama got his shot, the health care system became almost impossible to detangle. Almost. Instead of working hard to carve out his pet peeve from the bigger mess, expose its shins, and deliver a blow, President Obama chose to kick the whole system softly in multiple spots, hoping the change will materialize only where intended. It did not.

Obamacare’s main thrust was to provide health insurance to the 45 million Americans who were then uninsured, mostly because they couldn’t afford to buy insurance. If that’s all Obamacare endeavored to do, it would have probably been a resounding success. Instead, Obamacare chose to partially address the uninsured problem directly, while simultaneously attempting to lower the overall costs of health care, so the unaddressed portions of the problem will address themselves. It was too much intervention for the system to absorb at once, particularly since the underlying philosophy was old, unimaginative and empirically proven to be morally and operationally bankrupt.

At the very core of Obamacare is Richard Nixon’s (or rather Edgar Kaiser’s) notion that health care is best when throngs of people, devoid of agency, submit themselves to medical decisions of expert organizations whose job is to minimize the costs of health care. This idea is why we are told that the job of doctors is to “keep” people healthy and be “stewards” of scarce resources, why we need a health system instead of a “sickness” system, and why Obamacare mandated preventive care to be “free” across all health care. This idea is why most Medicaid, large chunks of Medicare and the Obamacare exchanges were surrendered to “managed care” and “accountable” organizations, why fee-for-service is incessantly vilified, and why massive medical surveillance by computers has been instituted.  And this idea is why independently minded private practices had to be demolished.

Remember those vaguely defined degrees of freedom? It turns out some of them had to do with pricing. You want free preventive care? Sure, no problem, just pay a higher deductible. You don’t want to pay a fee for each service? Oh well, then pay a hell of a lot more for each “bundle”. You want a “health” system? Perfect, just pay more for “sickness”. You want billion-dollar precision surveillance of the herd? Easy peasy, just pay more for everything. You don’t like how things turned out? Too bad, because while you were busy pontificating, we all merged ourselves into too-big-to-push-around “health” entities, so take it or leave it, see if we care.

Option Two

The health system we have today is very different than the one we had when Obamacare became law. It has bigger teeth, sharper claws and spectacularly buff muscles, and its grip on our lives has tightened significantly. You can’t close your eyes and click your heels to go back to pre-Obamacare times. You may be able to strip twenty million people of the lousy health insurance they now have, but you can't “repeal” the mergers and acquisitions of the last nine years, you can’t resurrect thousands upon thousands of small practices and pharmacies, and you can’t rip out trillion dollars of computerized surveillance. You can certainly indulge in fantasies of shooting it dead with your Medicare for All silver bullet, but the post-Obamacare health system is no fictional werewolf. It’s a very real animal. You can certainly wound it, but nothing is more dangerous than a wounded beast.

The only way forward is to do what Obamacare should have done, albeit under much more difficult circumstances. You still have around 30 million people with no health insurance, and over 100 million who are underinsured because they can’t afford the new deductibles. You also have small limited opportunities to lower expenditures on certain health related items such as prescription drugs and extra payments to hospitals. You also have a slew of Federal regulations and administrative programs that make everything a bit more expensive, with no added benefits to either buyers or sellers of medical services. Before you do anything though, you must overcome a very painful mental hurdle. Medical care is and will remain very expensive for the foreseeable future, and that’s okay.

We don’t know how to cure Alzheimer’s. We don’t know how to cure diabetes, kidney disease, heart disease and most cancers. These things make medical care expensive. Five percent of Americans use fifty percent of health care funds every year. Fifteen million people use around one million dollars each, in any given year. If these very sick people didn’t exist, or if medicine had nothing to offer them, health care would be affordable for everybody else. Alternatively, if medicine had a fully restorative cure for these and other afflictions, health care would be dirt cheap and life would be much better for everybody. Science will do its thing eventually, and nudging it won’t hurt either, but for now, we need to bite the bullet and pay up.

First, we spend lavishly:
  • Expand Medicaid to 200% Federal Poverty Level (FPL). The Obamacare Medicaid expansion was up to 138% FPL. Where did they come up with that number? The FPL is a joke. No person can live on $6.245 an hour when working full time, which is equivalent to the FPL. Expand Medicaid a little bit more (yes, I just said expand Medicaid).
  • Get rid of the individual market for health insurance. Create locally managed group plans for counties or whatever geographical measures make sense in a given area. Let those groups shop for health insurance just like employers do. This will put to rest all the “preexisting conditions” sound and fury.
  • Subsidize these group plans so nobody pays more than a certain percent of their income and establish parity with current employer sponsored insurance. Yes, it is going to cost money, probably more than Obamacare, but it won’t break the bank.
Now let’s save a few pennies:
  • Do the prescription drugs thing. Don’t reimport from Canada, thus taking advantage of “Socialized” medicine, while badmouthing it with gusto. Grow a pair and take on the drug cartels. If the President can threaten China with tariffs, Mexico with shutting down all trade moving through the border, the EU with dismantling NATO, and North Korea with nuclear annihilation, he can certainly negotiate a better deal for America with a bunch of pharmaceutical sleaze balls, no?
  • Get rid of the “free” preventive care and allow direct primary care, and any cash services that are priced lower than plan negotiated fees, to count against deductibles.
  • Speaking of deductibles, cap those nationally at ten percent of premiums.
  • Incentivize competition in physician services, and discourage shady referral schemes, by paying independent small practices, more than hospitals for the same service. Look at this as a form of reparations for past discrimination.
  • Get rid of all Medicare and Medicaid funded “initiatives” that have no clear purpose or return on investment and disallow anything that is not a direct payment to a medical professional, facility or supplier, from being included in health insurers’ medical loss ratios.
  • Require all sellers of health insurance to submit to yearly value-based performance evaluations and publish the results. This is not about clinical quality. It’s about quality of service, and value-based is the proper term here (for a change).
There is obviously more, a lot more, that we could do, but these are my pet peeves. Other people will have their own. If we keep it simple, and if we are careful when detaching little pieces from the tangled mess that is our health care system, we should be fine. The folks in Caruthersville MO will be getting plenty of insulin, and the wise men and women brave enough to take this or a similar route to solving the health care conundrum, will get reelected in a landslide. The alternative is that in a pointless battle against Obamacare, those who defend the Obamacare status-quo will win in that landslide (regardless of Medicare for All empty promises), because starving people will not trade the piece of stale bread in their hand, for promises of champagne and caviar due to arrive in two years or so, if all goes well.

The President’s political instinct was correct. Health care must be addressed in a positive and generous manner at this exact moment in time, or the party will be over sooner than anticipated (pun intended). Those who advise the President to postpone the discussion are not serving him or the nation well. These are the same people who pushed the stingy and cruel Paul Ryan agenda that brought the house down last year (pun fully intended).

The truth is that right now, nobody in Washington DC has a realistic solution for health care, so why not try something different? What do you have to lose? I mean, seriously... What the hell do you have to lose?

Tuesday, March 12, 2019

Disquisition on Medicare for All

Medicare for all Americans is on the table now. Think about it. The not-in-our-lifetime utopian vision of every progressive liberal, complete with dancing rainbows and unicorns, is now within reach. Alternatively, the socialized medicine Trojan Horse that will turn these United States into a toilet-paper free Venezuela is now before Congress. There are over half a dozen bills in Congress, introduced by serious people with serious intentions, proposing some version of government administered universal health insurance in America.

Whichever ideological camp you’re in, it is a profound disgrace that in America today many people cannot afford basic medical care, as profound a disgrace as having veterans sleeping on sidewalks, as profound a disgrace as having one in five children living in poverty, as profound a disgrace as having Americans going to bed hungry. This was not supposed to happen in our “shining city upon a hill whose beacon light guides freedom-loving people everywhere”. It just wasn’t supposed to be this way in a country founded on the inalienable right to pursue happiness. Regardless of why it happened, whose fault it is, or how to “fix” it, America was not supposed to be this way. It just wasn’t.
"We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America."
Our union is as far removed from perfection as it was in the years leading to the events of April 12, 1861. Whether you obsess over political affairs or social issues, our justice system seems to be established on very shaky and uneven ground. Domestic tranquility must have been some sort of eighteenth century inside joke. Our welfare is anything but general, the much-admired blessings of liberty seem to accrue to the few who do very little to secure them, and things don’t look any better for our children and grandchildren. We can debate the fine legal points, the Articles and the Amendments, but there is no question in my mind that we are failing miserably in at least five out of the six stated goals of our Constitution.

What do all these polemics have to do with “fixing” health care, you may ask. Health care is not a standalone issue. It cannot be debated, let alone “fixed”, in a political, historical and moral vacuum. Our health care woes are one manifestation of a much larger systemic failure of American society. The “concentration of power” in fewer and fewer hands is a calamity that was foreseen by a bitter, desperate man as he lay dying, and promptly ignored by many generations since, including our own. John C. Calhoun stared into his self-inflicted perdition and we stared back at him from the flames.
“At this stage, principles and policy would lose all influence in the elections; and cunning, falsehood, deception, slander, fraud, and gross appeals to the appetites of the lowest and most worthless portions of the community, would take the place of sound reason and wise debate. After these have thoroughly debased and corrupted the community, and all the arts and devices of party have been exhausted, the government would vibrate between the two factions (for such will parties have become) at each successive election … These vibrations would continue until confusion, corruption, disorder, and anarchy, would lead to an appeal to force”.
The tragedy at this point is that we, as an “E Pluribus Unum”, cannot rationally analyze, let alone agree on, either the nature or the cause for our failure to thrive, and as long as that remains the case, we will not be able to “fix” health care, or anything else for that matter. But perhaps there is still some room for discussion at the edges of Armageddon…

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One glaring commonality between all Medicare for All proposals is that they are neither Medicare nor for all. Nobody is proposing to make Medicare available to all Americans, which is rather strange if you think about it. The battle cries of Medicare for All, the ubiquitous #Medicare4All hashtags, are pure propaganda. The proposed plans range from letting a few more poor people buy into Medicaid (not Medicare) to the Cadillac plans of Bernie Sanders, John Conyers and the brand new bill introduced by Pramila Jayapal, including prescription drugs, dental, vision and long-term care, with no premiums, no deductibles and no copays, given free to all citizens, regardless of financial status. In addition to the official bills introduced in Congress, there are lengthy proposals from policy groups touting their superiority and/or soundness compared to all other Medicare for All arrangements. The opposing faction is peculiarly devoid of grand ideas.

The problem with grand ideas though is that, by definition, they must rest on a multitude of assumptions and some assumptions are better than others. You can assume for example, that breaking an egg on a hot surface will get you breakfast. It’s been done trillions of times and therefore one can say that this is a pretty safe assumption, maybe even a fact. You can then be tempted to assume that putting a hot rod through an egg will yield the same results, since the egg is broken and in contact with a hot surface. Now obviously, the hot rod is just a first step, and after extensive tinkering you have a brand-new type of frying pan with an electronic egg breaker embedded in the middle. It costs ten times as much as the frying pan you trashed and it’s only good for eggs, but it does break the eggs, something you never knew was a problem. Oh, and it only makes scrambled eggs, so you save time on complex cognitive tasks.

Obamacare sounded pretty good before it morphed into a pugilistic contest between bureaucracies. Berniecare, sounds pretty good too. I mean what’s there not to like? All health care is free, and we don’t have to pay more than we are paying now for health care. We may even need to pay less, in aggregate. And the payments will be more justly distributed across the population. And every single person, no matter how privileged, will have the same exact glorious health care. Heck I’ve been arguing for a system like that myself. For those interested, I am also arguing for peace on Earth, prosperity, health and happiness to you and your loved ones.

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Despite what hot-headed reformers are trying to tell you, American health care is not worse or scarcer than it is in other developed nations. It is better and more plentiful. The sole problem with health care in this country is that it is not affordable for most Americans. What does “not affordable” mean though? Does it mean that health care prices are too high? Does it mean that we don’t choose our care wisely? Or does it mean that people are too poor? The answer is of course yes and no on all counts. Furthermore, “fixing” any one of the above problems will likely exacerbate the others. Nobody knew health care could be so complicated, obviously, but it is.

Real GDP per household (2.2 persons) stands around $120,000. Median income per household is half as much. We currently spend on average $24,000 per household per year on health care. If every household got a fairer share of GDP, perhaps health care would be less “not affordable”, but even in the most egalitarian scenario, health care would still be a huge financial burden. Medicare for All seeks to shift the health care burden from individual households to the nation. When the nation is faced with burdens of this type, it either goes into debt or cuts budgets. Debt of this magnitude spells bankruptcy down the road, and budget cutting translates into Rationing. Pick your poison.

But maybe we can ration wisely. Maybe we can replace volume with value. Maybe. Either way, when volumes for one service line go down, another service line seems to miraculously become more popular. If we force all service lines to cut down on volume, prices per unit will inexplicably start soaring to keep the topline steady. Then how about combining nationalized health care financing with price controls, as all Medicare for All bills are suggesting? After all, this is working well for Medicare, no? Yes, it is working for Medicare, because hospitals and doctors can charge the difference to private insurers. If there are no private insurers, hospitals and doctors will need to cut their costs. How do most firms cut costs? By letting employees go and/or reducing their salaries.

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Over 16 million Americans are currently working in the health care industry. If you want to cut that mythical 30% that is presumably waste, I can guarantee in writing that before one wasted piece of paper is eliminated, 6 million people will be out of work. In all fairness, a couple of the more radical Medicare for All proposals include income replacement and “retraining” for a few hundred thousand health insurance industry workers envisioned to be displaced, which amounts to a few drops in the disaster bucket. Such massive unemployment will wipe out entire communities, not to mention the stock market, pensions, retirement savings, tax revenues, and safety net budgets. It may also deal the long overdue coup de grâce to the struggling American middle class.

In a service economy, which is what all progressive minds are glorifying now, if you cut spending on services, you shrink the economy, with all attendant consequences. And no, having more money in your pocket to buy more crap from China does not improve the situation one bit. The supreme irony is that when we add the resultant financial aid for those who will lose their health care jobs, and the many more affected by the ripples of our trimmer health care expenses, we will end up precisely where we started, if we’re lucky, which is not very likely. The point here is not to bash Medicare for All plans. The point is to highlight the magnitude of what is discussed. By comparison to Medicare for All bills, Obamacare was just minor tinkering, and look where it got us.

There are only four countries in the world, including our own, that have a GDP greater than our annual health care expenditure. Restructuring health care in America is like restructuring the entire economy of, say, France or the United Kingdom, and then some. The United States is the third most populous country after China and India and has the greatest influx of new immigrants each year. Pointing to how great the Singapore model is working, or how quickly Taiwan transformed its health care system is, forgive me, laughable. If we learn one thing from the Obamacare escapade, it should be that in health care, nothing, absolutely nothing, scales as predicted on paper.

Finally, as hard as it may be for you these days, please remember that smart people, with yards of skin in this game, may disagree with your preferred solution, not because they are greedy, not because they hate poor people, not because they can’t do the math, not because they are evil, and not because they are deplorable or crazed Marxists. So, please, get off your soapbox (I certainly did), look reality in the face without fear or prejudice, start listening to ideas that make you uncomfortable, and understand that pontificating about Medicare for All is as useful as bloviating about free-markets.

Wednesday, February 20, 2019

The Bonfires of Health Care

Let’s burn health insurance down. Greedy corporate bastards should burn. Big Pharma and big hospitals should probably burn too. You know who else is really, really, bad? Wall Street. Let’s burn the banks. And let’s burn Big Tech and the entire Silicon Valley cartel. Let’s also burn Big Agribusiness that’s making us fat and sick. And let’s burn the Oil companies that are destroying the planet, and let’s burn the automakers too. Heck, let’s burn all the globalist billionaires and while at it, let’s burn the White House. Let’s have a cathartic bonfire of all things we passionately hate.

The “scorched earth” military strategy was tried and found true time after time throughout recorded history. Unfortunately, the Geneva Convention banned this useful practice a few decades ago. Not to worry though, the aficionados of all burning things discovered a modern version of the same: the “scorched economy”. Like General Sherman marching resolutely to the sea, the warriors against all things evil are marching from election to election on what will hopefully soon be the ashes of the Great American Economy, and from those ashes the brotherly, egalitarian and perfect in every way, Phoenix shall rise. We simply cannot allow democracy to die in darkness. Hence, we will light the most magnificent bonfire the world has ever seen, and democracy will die in a glorious blaze second only to the Sun itself.

Health care is one fifth of the American Economy, and it is a highly combustible mixture of money, disease, pain, suffering, death, greed, lust, inequality, exploitation, theft, and even murder, along with every other sin known to mankind. It is a good place to start our illuminating destruction of evil. Health insurance companies cannot be allowed to exist. Pharmaceutical corporations must all die, and yes, hospitals should all be shuttered down. Heck, even doctors should be wiped off the face of the earth.

Our government, where we all come together to do good, should provide care to the sick, and preferably health to the healthy. Our government, by the people for the people, should invent new ways to prevent and cure disease. Health care should be given in the comfort of one’s home by artificially intelligent machines. Doctors and hospitals, like walls, are immoral 14th century implements, that can be easily replaced by moral technology, such as drones, sensors and other electronic “things”. Once nobody gets paid to do health care, because government, and because, you know, “technology”, health care will obviously be free. Problem solved. Move on.

To paraphrase Susan Sontag (mostly because one cannot write anything today without some reference to the Third Reich), 10 percent of any population is irrational, no matter what, and 10 percent is rational, no matter what, and the remaining 80 percent can be moved in either direction. In our case, the irrational 10 percent is alternately running for some elected office or serving on expert TV panels on everything, from fighting ISIS to fighting cancer, largely based on ability to quickly skim through Wikipedia articles. And when Medicare for All is deemed necessary to avert climate change, according to a recently introduced House resolution, one is forced to wonder if a Dodo Bird in Every Pot will be the winning electioneering slogan of our times.

Health care according to many well-intentioned people should be a “Right”. Americans have many such Rights enshrined in our Constitution, and the Right to health care seems to fit the bill. We have the Right to free speech for example. Is my Right to free speech exercised the same as, say, Jeff Bezos’s Right to free speech? We all have the Right to Assistance of Counsel if accused of a crime. Is an assignment to a public defender, the same as being able to hire Alan Dershovitz? We have a Right to not be assessed excessive bail. Do you have any idea how many people languish in jails for lack of $50 to post bail? Declaring health care to be a Right is a cheap and very cruel form of demagoguery.

What if health care is not a Constitutional Right, but just a right to a free public service, like say K-12 education? American public education has the largest cost per capita, middling outcomes, rampant systemic inequality, underqualified and underpaid teachers, and a constant stream of flailing Federal initiatives to have no child left behind. Lots of “tech” though, in every failing, illiterate classroom, and more added every day, except in the posh schools of the rich. That’s what a free public service looks like when the foundation is broken. There is little reason to believe that free public health care will be different, once the evil private sector goes up in flames.

Here’s an interesting thought. Would you be surprised to learn that employer sponsored commercial health insurance is the most egalitarian health insurance system around? Do you know why? Because the “decision makers” are required to live within the decisions they make. Unlike salaries and taxation, when it comes to health insurance, the big powerful CEO gets the same exact plan that his secretary gets. Their interests are perfectly aligned in this case. Compare that to free public services, like health care and education, where decision makers are in no way obligated to live inside the “comprehensive” solutions inflicted on everybody else. Think about that. There may be a clue here on how to go about fixing many things in this country.

Once you are safely in orbit around the Washington DC swamp, you will never again have to send you children and grandchildren to a public school, never again have to shop for health insurance, never have to use public transportation, never have to worry about rent, utilities or anything else the “American people” worry about day and night. All the problems you pretend to solve are theoretical. Other people’s problems. Sure, you may be a very good person, genuinely wanting to bestow medical care on all Americans, but it’s not like your little kid is at risk of dying because you can’t afford an asthma inhaler. Theoretical problems tend to generate theoretical solutions. Theoretical solutions seldom work in practice.

Setting everything and everyone on fire and watching it all burn in a semi-religious exorcism of all that is and has been evil in America, is not the same as having your own plump derrière baptized by the flames.
We who are about to be sacrificed in your self-aggrandizing arsonist rituals, categorically refuse to fuel the bonfires of your fake revolution.