Over the past 40 years, the age distribution of the U.S. population has gradually shifted upwards. According to the 2010 census, one in eight Americans is now over the age of 65, and one in three is older than 50. Most of this shift can be attributed to the aging of the Baby Boomers, who vastly outnumber current birth rates.

Women comprise the majority of this aging group because they typically outlive their male counterparts. Since many of these women were never part of the workforce and have limited financial resources, they are particularly vulnerable when it comes to the rising costs of health care. More and more elderly are forced to continue working due to financial strain. The current health care system—with its focus on curative care—is not equipped to handle the coming challenges of this aging population.

A greater emphasis on care giving will be needed to adapt to these changing demographics. As it is, the purpose of most medical care is curing illness. But what about the many elderly who suffer from incurable, chronic illnesses? What about the people who would rather live out the rest of their lives in peace rather than suffer through expensive and unpleasant medical procedures that would only prolong their life for perhaps a few more months? This area is currently neglected because caring for dying patients is not only depressing, but it also isn’t profitable. But as this population continues to age, the demand for caregivers and doctors specializing in geriatrics who can administer quality palliative or hospice care is expected to increase dramatically. Instead of trying to prevent death for the chronically-ill elderly, maybe we should instead focus on helping them come to terms with death and enjoy what life they still have left.

The elderly face the dilemma of a shortage of geriatric and palliative trained physicians. Unfortunately, the geriatrics subspecialty is the lowest paid, which has deterred physicians from pursuing training in this field. With the cost of medical school debt, physicians cannot afford a career in geriatric care. Aside from low compensation, Medicare doctor reimbursements do not cover the cost of patient treatment. With the aging Baby Boomer population and a lack of incentive for physicians to practice geriatric medicine, a lot of people will not be able to receive the care they need.

Sources:

http://www.medicareresources.org/blog/2010/12/15/shortage-of-geriatric-doctors/

It’s all over the news. Experts have been announcing for some time now that the recession is over and the U.S. economy is showing signs of recovery. Unfortunately, the medical industry is still dealing with the lingering, adverse effects caused by the recession. Survey data reveals that patients continue to delay or forego medical care under tight family budgets. This is resulting in 70 percent of hospitals reporting fewer patient visits and elective procedures. In addition, nearly nine in ten hospitals reported an increase in care, for which no payment was received. A high percentage of hospitals have been unable to revert to prerecession operating models. There are 89 percent of hospitals continuing to work with reduced staff and 98 percent have been unable to reinstate previously cut services and programs. The reduction in income has left hospitals in a difficult position, as they strive to provide the best care possible to patients and retain highly qualified physicians and administrative staff. Further, recruitment budgets suffer in a time where physicians are desperately needed in communities across America. It is not clear when the medical industry will begin its own recovery from this trend, but in the meantime, healthcare professionals in various disciplines are doing their best to meet the needs of their communities with the resources available.

Negotiating a clear and fair compensation contract with a physician can be a difficult thing to navigate, due to numerous laws and regulations that surround such a contract. Not least of these are the Stark laws, which ensure that a physicians compensation cannot be tied to referral of medicare patients. There are also CMS compliance program regulations for hospitals and pharmaceutical companies which ensure that payments are not extracted for unnecessary or repeated procedures.

CMS stated recently that “the general rule of thumb is that any remuneration flowing between hospitals and physicians should be at fair market value for actual and necessary items furnished or services rendered based upon an arm’s-length transaction”.

Fair market value itself has no proper definition in the scope of health care, but it will generally depend on the location of the organization doing the hiring, the physician’s particular abilities, and their area of specialty. The most important term in this opinion is “actual and necessary items furnished or services rendered”. This is expressly to avoid unnecessary billing practices that bring up the cost of healthcare for everyone.

Recently, CMS approved a variable bonus arrangement for physicians working in an organization where the bonus was granted upon meeting quality targets. In a recent advisory opinion, the OIG signaled that incentives may be used when related to work performed, as long as their documentation is clear. Variable bonus programs have been in play for some time now in many different organizations which employ physicians, mostly accompanied by a salary.

Organizations have been standardizing physician contracts for some time. This is generally necessary because of the legal implications involved, and each request for changes to the contract must be analyzed legally before moving ahead with the hiring process, in light of all of the complexities involved. It is certain that most physicians have moved beyond the contractor model to being employed by a particular organization, where their compensation is now tied to performance.

Specialists are quietly under fire in the new proposed health care bill. In it, the most highly paid doctors are asked to take a 5% pay cut, which is even more formidable than it sounds since Medicare dollars are worth 83 cents on the private dollar. When these figures are collated, it amounts to a pay cut of roughly 20% for specialists under the new health care bill.

The devil is in the details. According to a recent article in the Wall Street Journal:

    “Beginning in 2015, Medicare would rank doctors against their peers based on how much they cost the program—and then automatically cut all payments by 5% to anyone who falls into the 90th percentile or above.”  The War on Specialists, WSJ October 6th, 2009

This formula automatically penalizes specialists, as it is they that will invariably fall into the 90th percentile of that formula. Specialists become specialists for a variety of reasons, not least of which is the potential for a higher income. If their wages are stripped towards parity with general practitioners, will specialists still want to be specialists?

The common theory running through the health care bill is that the high costs of specialists will be defrayed if patients have better and more frequent access to general practitioners. However, the above formula simply penalizes specialists for doing what they do disregarding any other measures that have been put in place.

In addition, the health care plan goes after diagnostic tests. Echocardiograms and catheterizations have been reduced by 42% and 24% respectively. These diagnostic tests are vital to understanding what is going on with patients and their discouragement through the health care bill is a misplaced effort to trim costs. Cancer doctors are hit especially hard through slices to the CT and MRI pie, both of which are vital tools in cancer diagnosis and treatment. Payments for antitumor radiation therapy will fall off by up to 44%.

While the cuts referenced don’t actually cut any spending, they definitely shift the money from one area to another. In its quest to make the specialist less of a driving force to the patient than the general practitioner, the health care bill is cutting too close to the bone where specialists and their diagnostic equipment are concerned.

The Senate Finance Committee will be voting October 13 on its overhaul to the health care bill. The newest incarnation of the bill has a price tag of $893 billion. The bill was drafted by the Commitee Chairman, Max Baucaus (D- Montana). It is expected to pass, but not without some “nay” votes from some Democrats, who object to it based on differences over how to expand coverage.

The bill has been changed substantively since its inception, with a provision included to exempt all Americans over 65 among others. The bill will basically require all Americans to have some form of health insurance, similar to the current requirement to have car insurance. The main concern of the opposition is that younger taxpayers have to shell out an abundance of new taxes in order to pay for the plan.

The package introduced by the bill will expand coverage to over 94% of Americans. All Republicans are expected to vote against it except perhaps Rep. Olympia Snowe of Maine. The final committee vote will bring the bill out of committee and onto the senate floor within two weeks of a pass in committee.

For more see the Washington Post.

When we think of medical discoveries, most of us think back to the early twentieth century to discoveries like penicillin and the polio vaccine. We should be giving credit to the more recent breakthroughs in medicine; the problem is nobody really knows what they are.

For decades, the U.S. healthcare system was the envy of the entire world. Not coincidentally, there was far less government involvement in medicine during this time. America had the finest doctors and hospitals, patients enjoyed high quality, affordable medical care, and thousands of private charities provided health services for the poor. Doctors focused on treating patients, without the red tape and threat of lawsuits that plague the profession today. Most Americans paid cash for basic services, and had insurance only for major illnesses and accidents. This meant both doctors and patients had an incentive to keep costs down, as the patient was directly responsible for payment, rather than an HMO or government program.

We should remember that HMOs did not arise because of free-market demand, but rather because of government mandates. The HMO Act of 1973 requires all but the smallest employers to offer their employees HMO coverage, and the tax code allows businesses – but not individuals – to deduct the cost of health insurance premiums. The result is the illogical coupling of employment and health insurance, which often leaves the unemployed without needed catastrophic coverage.

Ron Paul, excerpted from Examiner Article

Upon reading this, we thought we should explore both “the old days” of healthcare referred to by Paul and also how other countries handle their health care. We start part one of this series with exploring how other countries handle their health care.

Many second and third world countries operate on a cash basis for any doctor and healthcare related visits. In Venezula, a vacationing family had to have emergency health care for their son after he had a seizure that was caused by an ear infection. After two hospital visits and ambulance rides, with multiple tests at both facilities, the bill came out to only $685.00. While this obviously isn’t comparable to prices in the US due to the lower cost of everything in a second world country, it is interesting to explore their system. Costs are kept down because doctors are required to donate three days a week of their time, something that would be unenforceable in the States but the idea is worth exploring. What if everyone in the medical industry donated an hour a week? How much money could we all save then?

In Canada, instead of paying private health insurance, Canadians pay more taxes to the government than we do. Income tax in Canada ranges from 24% to 46%, depending on your tax bracket. Most Canadians fall into the 24%-32% tax rates. The government, in turn, pays for all health care except for prescriptions and dental. Emergency dental procedures are covered, as are drugs given on an emergency hospital visit. Canadian doctors do not donate any time to the government, although they are less well-paid than their colleagues in the US and as a result there is a marked “brain drain” of doctors from Canada to the US. In contrast, in the US in 2008 companies paid an average of $12,700 per worker for health care premiums. Employees are often asked to kick in for premiums as well, and not all costs are usually covered in all plans. This means that running a company in the US is much more expensive than doing business in Canada or any other country. There have been a number of claims in the US media lately that Canadian healthcare is deplorable, but the only real down side is a wait time of 4 weeks for a specialist and longer for non-emergency surgeries. Most Canadians are happy to wait since the price is right.

In Sweden, the state pays 95% of medical costs, with the patient paying a nominal cost for examination on each visit. In addition, if a patient is declared ill, the patient is paid a percentage of their daily wage from the second day for the first 14 days by the employer, and after that by the state until they are declared fit.

In Nepal, the state subsidizes health care so that each resident pays about 70% of health care costs in cash on each visit.

Japan has an interesting system. Since 1973, all seniors have been covered for their health care. Everyone else is governed through a universal health care insurance system with fees set by a government committee. You must be enrolled in an insurance company if you are a resident of Japan. This is very similar to the two-tier insurance system that President Obama is putting forward, minus of course the free health care for seniors. 

There are lessons to be learned here from all countries. In the case of Nepal, partial subsidy keeps costs down significantly. In Venezuela, payment is still solicited, but doctors donate a good portion of their time to ensure that the system works. Japan has managed to provide free health care for its seniors and runs a state-sponsored health insurance program, all for the low cost of 6% of their GDP, much lower than Canada’s 10% of their GDP for providing free health care for everyone.

It could be argued that the most sensible avenue to health care reform is to examine what works and what doesn’t in each country in order to put together a system that works well for everyone. For companies, health care organizations, and of course patients.

In a preliminary trial, a drug developed by Roche and Plexxikon Inc. has shrunk advanced melanoma tumors by 30%, even in cases where it has spread to other areas. The drug works through blocking cellular mutation in BRAF, a cellular pathway that occurs in 60% of melanomas and 8% of all solid tumors.

Results from the Phase 1 trial were released at the meeting of the American Society of Clinical Oncology in Orlando. The drug is currently known as PLX4032 and the trials were conducted through the University of Pennsylvania. Dr Keith Flaherty, the trial’s lead investigator, stated that ‘PLX4032 has shown both tumour shrinkage and delay in tumour progression in patients whose tumours harbour a BRAF mutation, as well as improved quality of life for symptomatic patients’.

Melanoma is one of the deadliest forms of skin cancer and treatment options have been limited to traditional methods of cancer care until now. This is huge news for those who may develop advanced melanoma in the future; some participants went as long as six months without symptoms because of the drug.

Quality ratings for hospitals come in two flavors – professional and public. As can be expected, the professional quality ratings are the ones that can be trusted, but they are not as easy to access as the public rating systems. Public rating systems can be skewed towards a positive outcome by advertising, or skewed towards a negative outcome due to one complaint. Professional rating systems are often fairly done through industry reports and surveys, and thus can be more trusted. Patients should be discouraged from using internet healthcare rating systems, even if they are favorable towards your organization. What then are the professional quality ratings that you can trust, and how do they work?

The first thing to note is that even hospital quality rankings that are considered top in the industry can be considered flawed when placed under a microscope, such as the rankings of the US News and World Report, a frequent go-to guide for hospital rankings. These reports are generally meant to be overall rankings and may not take into account representative samples or all statistics that are available. In the end, there is no one way to denote “the best” hospital for a certain surgical procedure. Most hospitals and medical professionals are created equal and while some surgeons and physicians may be considered subject matter experts, there is no guarantee that this expertise will translate into better patient care.

The US News and World Report uses the four following criteria to rank hospitals:

1. Having intensive care units staffed by specially trained doctors

2. Having computerized order-entry systems for medications and other orders with error-prevention measures

3. Performing procedures such as cardiac catheterization and caring for certain high-risk neonatal conditions4. Having practices such as those designed to control hospital-related infections and cut down on medication and treatment errors.

While these are lofty goals, what about overall patient satisfaction surveys, or other criteria that medical professionals and patients alike can start rattling off? The reason is simple – these four are really the only universally measurable criteria for most organizations. Until there is a better source of information, such as the new EHR’s that the Obama administration wants to see in place, the US News and World Report is the best source for quality ratings of health care organizations.