How often do you go to the doctor? If you are like me you don’t go often because it is inconvenient and expensive. Health issues tend to pile up. When something comes along for which I really need immediate treatment, I make an appointment and I go. Now, the national average cost for a visit to the doctor’s office is about $65. That, however, does not tell the whole story. If I go in for a sore throat and I am seeking an antibiotic, I also do a “health care dump”. “Doc I have a sore throat, but there is more. My elbow hurts, I have a mole on my arm I would like you to look at, allergy season is coming and I need a new antihistamine, and I am about out of my asthma medication.” My doctor listens intently and taps away on this little electronic note pad. He then diagnoses and prescribes something for each of my illnesses. Each malady is an International Classification of Disease (ICD). Each prescription is a Common Procedural Terminology (CPT). For every CPT, the doctor is reimbursed. So, when I go in for my sore throat which should cost me $65, I walk out of there with a bill for $300! This leads me to my second observation. Insurance co-pays are going away in all but the most “cadillac” of insurance plans. The co-pay will be replaced by higher deductibles. For most people the significance of this is lost, but when you combine the “health care dump” to the end of co-pays, you get a very significant monetary event. Before, I paid $15 to $25 for my co-pay and I could tell the doctor everything that was bothering me. I would do so because it was convenient and because I was making the best use of my co-pay. The insurance company paid the remaining $285 for the CPTs. Now, if I have failed to exceed my deductible, I have to pay the entire $300. It shifts the cost burden away from the insurance company and on to the consumer. In some ways, this is a good thing. It forces the consumer of medical services to shop for a better deal in health care. However, it could mean that I opt not to have the doctor help me with my elbow or take a look at the mole. Maybe I do without the asthma treatment, which, during an asthma attack, can put tremendous strain on my heart. No, the best solution is not to eliminate care, but to find a more cost effective delivery system. Many telemedicine offerings will do the entire “health care dump” for a flat fee. Viva la consumer!!!!
Archive for the ‘Health Care Costs’ Category
How Many Things are Wrong with You??
Wednesday, February 24th, 2010What is Capitation?
Friday, February 19th, 2010In U.S. health services, capitation refers to a fixed “per capita” amount that is paid to a hospital, clinic or doctor for each person served. It is the basis for the Health Maintenance Organization (HMO). You collect a flat fee to cover a certain number of lives and you hope that you have collected enough to do the job. In fact, you hope you have collected enough to do the job and still have some left over for profit. I will try to tie all of these health models together in a future blog.
Preexisting Conditions II.
Friday, February 19th, 2010Today’s Wall St Journal has a follow up article to the WellPoint attack. It gives an example of what happens when you prohibit insurers from denying coverage due to preexisting conditions. The state of Michigan has a 1980 law on the books requiring nonprofit insurers to accept all applicants. Last year, Blue Cross Blue Shield of Michigan lost $280 million prompting them to ask for a 56% rate increase. Gee, who could have seen that coming???
I wrecked my car, can I get it insured?
Thursday, February 18th, 2010No sorry. You have to buy the insurance before the car is wrecked. The same is true for buying homeowners insurance after the fire. The wrecked car and the burnt house have what are called “preexisting conditions”. If the car insurance company agreed to fix uninsured cars after the wreck, they would go broke. Does anyone actually doubt this??? Yet, in Washington, they say health insurers are evil for refusing to insure after the fact for preexisting health issues. The original plan was to have a mandate for all Americans to purchase health insurance. That made sense. There would be no conditions that exist prior to owning health insurance because everyone would already own it. The insurance companies, seeing an opportunity to sell policies to the uninsured signed on. Now, the mandate is either dead, or the penalty too weak to enforce the mandate. So the insurance companies are out and we’re back to, “I wrecked my car, can I get it insured?”
“Just Say No To Health-Care Summitt” WSJ 2/17/10
Wednesday, February 17th, 2010Great editorial from Betsy McCaughey in today’s opinion section. She is the Chairman of the Committee to Reduce Infection Deaths. Lots of good points but the best one is this: 40%. In fiscal 2009 total government spending (fed, state and local) exceeded 40% of GDP. It is the first time that has happened since WWII. You can’t get economic growth if government is confiscating that much of the economy’s production. “Americans don’t want to solve every social problem at the expense of their freedom to choose how to spend their own money.”
EHR, Electronic Health Records
Tuesday, February 16th, 2010Here is an interesting article on EHR from a major health insurance company. http://coventryhealthcare.com/emerging-issues/PersonalHealthInformation/index.htm
Health care on CNBC this morning
Tuesday, February 16th, 2010Today David M. Walker from the Peter G. Peterson Foundation was on Squawk Box on CNBC this morning. The foundation is a leading entity in the fight to maintain fiscal sustainability of the United States. Walker rightly pointed out that our success, if not our very survival, will be based on our ability to continue to grow our economy. A large piece of the puzzle is health care. The U.S. spends 17% of Gross Domestic Product (GDP) on health care while the rest of the industrialized world spends about 9% of GDP. That is a huge disadvantage in our global competitiveness and in our ability to attract capital to this country. Our challenge is to contain costs without restricting access or rationing care.
Past Wall St Journal editorial
Saturday, February 13th, 2010About a month or so back I read an editorial in the Wall St Journal that really shed some light on the health care debate. It was written by a freelance writer in New York and it discussed the impact the bill would have on his personal health decisions. He pointed out that the bill had a mandate to purchase full coverage. For him as a single person in New York the purchase price of a full policy with all of the required coverage would run about $13k per year. Currently, he carried only a catastrophic coverage policy that cost about $2k per year. He figured that left him with $11k per year to cover all of his incidental medical expenses and if he stayed under that limit, he was ahead of the game. He rightly pointed out that this was his health plan, he liked it and that President Obama had repeatedly assured him that if he liked it, he would get to keep it. Unfortunately, that is not the case. The bill would force him to join the insurance pool precisely to utilize his $11k to subsidize others who had no insurance. While I was reading this editorial, it occured to me the efficacy of his plan. The AMA created something called Common Procedural Terminology or CPT codes. It has created a procedural based system. Every procedure has a CPT code and reinbursement is based on the code. The codes effectively dictate what is repaid to the physician. The practice of medicine becomes one long list of procedures. The more procedures, the more repayment. Doctor compensation is not results based, it is procedures based.
Modernizing health care delivery
Thursday, January 21st, 2010For those that remember Watergate, you may recall the quote from Woodward and Bernstein’s source, Deep Throat: “Follow the money”. Like so many other things in our society, much can be revealed by following the economic trail and motivations that the system provides. Let’s take one simple example.
Perhaps you have had a sore throat before. You call your primary care physician and he can get you an appointment- next Thursday. His calendar is already full, and this makes sense because he is economically enticed to see as many patients as possible during a work day. Your next stop is the Urgent Care center. This avenue is available immediately, but when you arrive, the wait time is 4 hours. They tell you 2 hours at the desk, but we all know how that goes. (more…)
Hot off the press!
Friday, January 15th, 2010January 15, 2010 / The Association of American Medical Colleges has estimated that due to population growth, aging and other factors, the country is facing a potential shortage of 159,000 primary care physicians by 2025. Telemedicine technologies help scarce healthcare professionals reach the widest patient population most efficiently. This number rose from earlier projections of a 40,000 shortage by 2020. Unfortunately, that’s about the time I’m really going to need to see my doctor.