Should cost be a deciding factor?  “These are awkward discussions”, said Dr. Allen Lichter.

We value life and we say that we will do all that is necessary but the reality is that cost must be considered.  In the insurance and medical world there is a value decision that must be made; value being measured in quality adjusted life years. QALY is not something any of us want to think about but it is a topic that this country has not yet had a national discussion on.  As universal health coverage is begun to be implemented this is a discussion that must be had. Cost must always be considered. 

If you are uninsured or under insured then these decisions are very hard - as the article states - treatment could mean bankrupting the family.  It would all be worth it if the cancer were cured and put into remission but if all it does is add a few short painful miserable months of added life; is it really worth the pain trauma and cost?  This is the QALY dilemma.

You might want to ask your physician’s office what they are charging  for the drugs they plan on giving you.  The Medicare drug pricing list is a public document and you might want to compare the difference between the charge and the average sale price of the drug.

Institute for Technology Assessment QALY

Example of an QALY for implanted defibrillator’s.

Original press article

Senator Clinton, on March 28^th, said that she would set family premiums for universal health care at 10% of your income.  Data supplied by the America’s Health Insurance Plans (AHIA) was used and showed that the average family premium was $5,799, close to the median family income of $58,526.

I hope that this is a poorly written summary of Senator Clinton’s speech because the data does not support the comments.  AHIA does not even show these numbers on their own website.  I hope that Senator Clinton’s staff and advisor’s know how much a family really pays for health coverage.

The amount quoted in the press release is closer to what a worker pays AFTER the employer pays.

The Kaiser Family Foundation shows the average family premium is between $10,000 to $12,500 annually.

In Georgia the family premium is around $10,300 in 2005.

The media family income reported by the US Census in 2005 is higher than the number quoted by AHIA.

If this is not enough Linda Blumberg, with the Urban Institute has an article in Health Affairs Web Exclusives, Volume 26, Numbers 4 -6, titled ‘Setting a Standard of Affordability for Health Insurance Coverage‘.   

Exhibit 1 Premium payments as percentage of income for family coverage was split out by income as a percentage of poverty.  Those with incomes over 300% of poverty paid 5 - 10% of their incomes for family coverage.  Those under 300% paid between 14 and 26% of their incomes.  The median for all families was 9.6%. 

The other issues raised by Ms. Blumberg was the out of pocket expenses incurred by these families.  The mean out of pocket percentage was 16.7%; ranging from 7 - 13% for those over 300% of poverty and 20 - to 35% for those under 300%. 

Do not put your faith in what statistics say until you have carefully considered what they do not say.  ~William W. Watt.

In 1965 Ralph Nader published "Unsafe at any Speed".  In 1965 there were 47,089 automobile fatalities with government estimates that the total could reach 100,000 by 1975.  Most people remember the Corvair but the book went into much more detail about automobile safety.  Congress passed the Motor Vehicle Safety Act of 1966 and things changed.  Automobile fatalities in 2005 were around 43,500  and there are many more vehicles on the road today than in 1965. 

In 2000 the Institute of Medicine published "To Err is Human", a study on the safety of the US health care system with the estimate that at least 98,000 patients die each year of preventable hospital errors.  In 2004 Health Grades placed the number at 195,000 patients annually.  It is estimated that about 100,000 of these patients died from hospital acquired infections.  In December 2004 HCA conducted its own study and found and prevented over 183,000 medication errors in their own facilities.

In the December 17th edition of Modern Healthcare is an article titled Hospital Acquired Revenue.  The subtitle states "infections can actually help a hospital boost its bottom line." 

The reaction to Nader in 1965 was quick, severe and effective. The reaction to IOM has been  slow, lukewarm, and feeble. 

I do not want to say that things have not happened because they have.  Leapfrog and the Institute of Health’s 5 million lives campaign are excellent examples but the point I am trying to make is that we are having the same discussions today about hospital infections and preventable deaths as we were in 1965 about automobile deaths.  They are both bad but we are talking about 3 times as many deaths in hospitals than in automobiles.  Why is it taking so long to change?

Payment reform is an answer, use of computer order systems is an answer, stricter adherence to protocols is an answer, public reporting is an answer, so is Medicare’s new policies, and Never Events are also the answer. 

More on the book "Unsafe at any Speed" just click here.

Chart of automobile fatalities click here.

Information on the 1966 Motor Vehicle Safety Act click here.

HCA internal study information is here.

SBG has a policy of supporting hospitals and not contracting with physician owned surgery centers.  This has been a big issue over the last few years.  More and more physicians have been opening centers; labs, imaging, surgery, and a whole assortment of revenue enhancing and revenue generating services.

It is a two edged sword.  Let’s explore the two edges.

For a community like Savannah we need vibrant healthy hospitals, hospitals need revenue.  If the physicians continue to siphon off the low risk healthy paying insured patients then the hospitals will be left with high risk complicated uninsured patients.   

Hospitals need to be aware, and I have told them this before, surgery centers are a threat to them.  When compared to hospitals the through put for centers is higher, complication rates are lower, and patient satisfaction is higher.  As surgery centers become more mature, as they get their certifications, as the physicians learn how to contract and price their services, it will make it extremely difficult for plans and employers not to contract with surgery centers. 

One solutions is partnering; the physicians and the hospital operating a joint center.  This is filled with its own set of problems and much has been written about this subject. 

I do not believe this new regulation will go into effect soon.  The Legislature needs to work out their internal rules first.  Eventually this may be decided by the Georgia Supreme Court.  We will have watch and see.

Savannah Morning News Vox Populi November 5, 2007

 "A licensed doctor ordered diabetic testing for a friend of mine and Medicaid refused to pay for it.  Medicaid can determine whether a person needs treatment?  Medicaid has become so heavenly minded that they have become no earthly good."

My first reaction is one of horror and this cannot be true.  The sad fact is that I hear these stories all the time.  Lets look at my second reaction.

This is a second hand account.  I would really need to ask the patient what happened. I would also have to talk to the physician.  Medicaid is in a big push right now (along with Medicare and a large number of other insurance companies and employers) to increase the number of diabetic testing being done.  A diabetic should have a lab blood test (Hemoglobin A1C) every three months; a fasting blood sugar test four times a year.  So the comment that Medicaid refused seems to be exactly opposite of what my experience is.

Okay - so Medicaid refused to pay for it.  Medicaid would only know about the test after if was done.  As with most insurance companies they only find out about things being done when a claims is submitted for payment.  There are exceptions where you must call the insurance company before you get the service (precertification sometimes called utilization review) but that is for high cost services. Blood tests are not normally precertified.  So was the test done?

This is where a patient needs to have an advocate; someone to go with them to the physicians office.  The advocate can hear what is being said, see what is being done, and make sure the patient understands the physicians instructions.  Advocates are really a must for older patients or those patients with impairments. 

What did this friend do to get this situation fixed? The physicians office in this Vox Populi, what did they do to help the patient?  What was the final outcome?  Did the patient misunderstand something? We may never really know but I hope they do get the care they need. 

There are other blogs that are related to my SBG blog that you may want to include in your reading.

HHS Secretary Mike Levitt’s Blog http://secretarysblog.hhs.gov/ 

Thomas Jefferson University Health Policy blog being blogged by Dr. Nash who is eager to converse with us about all the latest health policy news.

http://departmentofhealthpolicy.blogspot.com/

Hello Savannah.  Gary Rost here, Director of Savannah Business Group on Health, or as it is commonly known - SBG. I have decided to start a blog that expresses my opinions and thoughts about all things health related (maybe health administration is a better description) especially patient experiences, health plan issues, providers issues, quality. 

Quality!  The unknown virtually unmeasured part of the value based purchasing equation.  Value is the sum of the cost plus the quality. V = C + Q.  Too many employers purchase health plans on the cost and then complain they experience rate increases.  There is a large learning curve yet to be overcome.

Anyway - I look forward to blogging and hope you enjoy reading my blog or at least think about what I blog about.