Obamacare: The Good, The Bad and the Trojan Horse

A bird’s eye view of the medical regulatory landscape since the late 1700s reveals  skirmishes and battles over physician qualifications,  education standards, hospital and physician accreditations, medical ethics, drug and device development  and,  last but not least,  payment mechanisms.  From a distance we also see a steady march toward a centralized bureaucracy administering all aspects of health care– standards, regulations, choices, availability of services, payment methods and more. The latest steps came in  2010, when,  after a contentious battle,  one party of Congress passed the massive Patient Protection and Affordable Care Act, also known as the PPACA, the ACA or Obamacare.

Some good

During the legislative haggling over the ACA, the House Speaker famously said that we had to pass the law to see what was in it and after six years, some things are clear.  We can no longer be denied insurance because of pre-existing conditions and there can be no cap on payments over time.  Some people are buying insurance for the first time because they can receive federal subsidies that make premiums more affordable.  Medicaid has been widely expanded and made available for many whose incomes had made qualification impossible before.  The number of people who are uninsured has fallen back to 13-14% -the best since the 1990s.

Some not so good

The law improves access to healthcare via additions to the labyrinthine system in which costs remain invisible to doctors and patients and the largest profits go to hospitals and insurance companies. For many people, insurance costs and out of pocket deductibles are now higher and choices of doctors and hospitals reduced.  Carrying health insurance is a new legal requirement and our policies must include services we don’t need (such as maternity care).  Breaking the law means paying a tax penalty of up to 1% in the initial years after passage, more in years to come.  And of course there are innumerable rules.

A failure to address costs

Despite clamor for reform because of the outrageous prices attached to medical care, the legislators crafted a law that addresses medical costs only by increasing taxes and threatening funding.  The 2700 page ACA includes new taxes on investment income and on medical devices, fees to be paid by drug companies, new taxes on every Medicare and private insurance company policy, as well as additional policy fees that finance an independent and unaccountable organization dedicated to clinical effectiveness research. Insurance companies must pay fees to sell their policies on the health care exchanges. Half of the law’s estimated $1 trillion cost will come from cuts in Medicare spending, pain not yet felt.

The Trojan Horse

Most noteworthy for those readers concerned about the long term effects of the ACA  is a new agency called the Independent Payment Advisory Board (IPAB), composed of 15 people chosen by the President, serving 6-12 years, but able to stay in their posts indefinitely if the President chooses not to replace them.  The controversy spawned by the stunning powers granted to this board and the fact that the President has yet to appoint any members to it have convinced many that the board will never be functional. Nevertheless, IPAB is a Trojan horse inside the city’s gates.  Should it come to life, the process of herding everyone into a bureaucratically controlled healthcare system will be easy to complete.

Getting around democratic messiness

The Independent Payment Advisory Board is deliberately designed to get around the messiness of democracy and the reluctance of politicians to act responsibly when they risk unpopularity. For instance, for over a decade Congress repeatedly blocked the cuts that current legal formulas demand in Medicare reimbursements to doctors because the cuts were too onerous. They also feared the effects of Medicare cuts on the private sector, where payments are tied to the Medicare schedule. The ACA removes political considerations from efforts to control costs by handing the problem to the IPAB, which then inverts the normal process of legislation and effectively ties the hands of Congress, the President and the courts. IPAB’s recommendations will be presented as completed legislation that must be enacted unchanged unless the President  and three-fifths  of both Senate and House of Representatives reject the proposal and present an one that cuts spending equally. IPAB’s proposals, once implemented, cannot be subject to judicial review.

No oversight

The Board’s proposals are exempt from administrative responsibilities such as citizen review and must be must crafted yearly if projected Medicare expenditures per enrollee are determined to exceed a predetermined figure. Growth projections regularly exceeded the trigger point up until the law was enacted in 2010.  The sudden, unexpected decline in projections since ACA enactment is not understood, but it took the negative spotlight off the advisory board for the time being.

Handing the power of healthcare cost allocation to one, unelected individual

Should Medicare cost projections balloon before the President has appointed IPAB members, the ACA allows the Health and Human Services Secretary to assume the responsibilities of the board – making it possible that one unelected individual could decide how to allocate healthcare resources. The President’s executive discretionary power is forbidden in this situation. He is not allowed to shelve the Secretary’s proposal and must present it to Congress within two days.

Perpetual  life for the IPAB

Congress’s only way to repeal IPAB is to present a bipartisan proposal created between Jan. 1 and Feb. 1, 2017 (about 15 working days in the midst of the start of a new presidency) and then to get the proposal approved by three-fifths of  Senate and House members  by August 15, 2017. If the attempted repeal fails, no Congress may ever again attempt to repeal the Board.  After 2020 Congress may never enact substitutes for the proposals the board makes about healthcare payments.

At present, most people seem less concerned about the potential for unconstitutional government action than about the practicalities of getting insurance under a law that seems here to stay unless it is repealed in toto. While many people might welcome continued movement toward a federally administered healthcare system, they should remember that we already have two. One is the Indian Health Service and the other is the  VA. Both have huge problems.

Health Insurance: How We Became Passengers on a Runaway Train

    Once upon a time, when a man felt unwell or was injured, someone fetched the doctor. The doctor might not have done much for his patient except explain symptoms and urge endurance, but the interaction eased the patient’s worry.  He paid the doctor in money, or maybe chickens, and very often got better because the body is good at fixing itself.  With time doctors gained more knowledge and tools. More treatments became possible.  Along came offices and hospitals and then insurance against the unexpected costs of hospitalization.

The birth of health insurance

After WWII, when wages were frozen, employers attracted workers by offering “hospitalization insurance” as part of an employment package. No one foresaw the chains that came to bind patients to employers and doctors to insurance companies, because no one foresaw the explosion of technology that drove a perpetual escalation of costs. That awaited another well-intentioned idea – a government sponsored system to pay for the health needs of the elderly (Medicare), and later the poor (Medicaid). The infusion of federal money (also known as someone else’s money) into health care spurred medical advances and hospital care in ways never seen before.  Sensing unlimited growth potential, big business came calling and dragged the entire enterprise onto Madison Avenue, labeling it “health care.”  Hospitalization insurance morphed into the medium of transaction for all services rendered.

Out of control

If, in this new medical world, you feel like a faceless passenger on a runaway train, you are not alone. And if you seek out the locomotive, you will find that there is no engineer – just a bunch of firemen madly shoveling coal into the engine.    The firemen are your friends and neighbors.  They work for insurance companies, pharmaceutical and medical device companies, advertising agencies, the media, and the government and, of course, universities, hospitals and clinics. The health care industry is a giant machine employing millions of people and consuming close to 20%  of the gross national product.  (Note: the original version of this column was written in the 90s, when the figure was 12%; when it was published in early 2008, the number was 15%).  Changing direction is no simple matter, but staying the current course seems foolhardy.

The power of invisibility

We fear the costs of health care, we resent the power of insurance companies,  and we are submerged under a tidal wave of scare tactics designed to sell products we don’t understand and have no way to evaluate.  We lack physicians who know us well, and we use emergency rooms and urgent care facilities as family doctors.  Unless we are seeking “non-essential” care, like cosmetic surgery, the transaction of worth in medical encounter – the bill – is mysterious, hidden under an economic invisibility cloak that rivals Harry Potter’s.  While we all know and weigh the costs of life’s other “essentials” such as food and shelter, we are not allowed to make value judgments about medical interventions that grow more numerous by the year.

Invisibility of cost interferes with responsibility on the part of doctor and patient alike in judging the worth of these interventions.   The impulse to “just check things out” is much easier to indulge when little or no money changes hands.  When “insurance pays,” doctors feel fewer qualms about ordering expensive tests, and no urgency about understanding and explaining the arcane statistics behind the studies that prompt the treatment fashions of the day.  Ever-present fear-mongering sells us on the need for diagnostic tests and interventions to treat “risk factors” and patients feel guilty if they have the temerity to question recommendations for life-long drug taking and repetitive screening tests and X-ray exposure.  And in the meantime, medical costs have risen to levels that bear no relationship to the costs of the rest of life,  the arcane language of medicine is so rarefied that the non-medical  “consumer” has no hope of understanding it and must rely on interpretations by the “purveyor,” and all too many of the purveyors have only a rudimentary understanding of the products they pitch.

What is the goal of all the money spent?

As long as we hide costs in the accounting books of insurance companies, we can fritter away one political season after another pretending the “healthcare problem” is just about access to medical care.  We can avoid the tough questions about the goals of health care. Do we want to tie up the bulk of our resources in the last 6 months of life (as happens in Medicare spending), or can we acknowledge that intense intervention at the end of life adds a great deal of distress without any gain? How much do we waste and how much anxiety do we cause with extra tests and rules aimed at keeping lawyers at bay?  As we now begin to watch upcoming generations fail to exceed or even meet the life expectancy of their elders, can we admit that the high tech medical road we’ve chosen may be the wrong one?  That real prevention is better than treatment? That real prevention requires education, patience, consistency and self-discipline more than obsessive searching for disease already present?  That cures of disease come from full understanding of the science involved, not from premature attempts to sell the products of research to as many people as possible?

Resisting manipulation

As you negotiate the jungle of media hype and medical sales pitches, you must resist being manipulated by fear, and regain the trust in your body.  It is not a fragile edifice that will crumble without constant examination and intervention. It is a marvel of engineering that attempts to protect you from what you do to it. It will never be free of minor, self limiting ailments, but it responds well to good care that befits its design for life 40,000 years ago. Be glad modern medicine is there for the catastrophes that cut young life short, and to help with cataracts and hearing aids and artificial joints.  Be relentless in questioning of the need for drugs and procedures, and ask what will happen if you opt not to go ahead. Don’t be steamrolled by statistics – ask for absolute numbers rather than percentages, which tend to make results look more impressive than they actually are.  For instance,  50% reduction may mean that only 1 person instead of 2 out of a thousand died of a given disease after the new treatment.Whatever the statistics, you are an individual and the complication or success either will or will not happen for you.  As you get older, seek doctors who see you as a whole person, not one organ or another.  And remember that life inexorably winds down and ends, no matter what you pay and do. Don’t spend it all worrying about your health.

Wall plaque, author unknown

Life should not be a journey to the grave with the intention of arriving safely in an attractive and well preserved body, but rather skidding in sideways, chocolate in one hand and wine in the other, body thoroughly used up, screaming “WOO HOO what a ride!”  

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