Archive for the ‘Medicine’ Category.

Bandaging a Finger in New Jersey Shows Rot at Heart of US Healthcare

A NJ teacher cut his finger. After it wasn’t healing properly he visited the ER. No x-ray, MRI or anything more than a bandage, a tetanus shot and some ointment. He didn’t even see a doctor and was instead treated by a nurse practitioner.

He was billed $8,200 for the visit.

He called around and found the going rate at most clinics and hospitals was between $400 and $1000.

I’m not sure which is worse: the $8,200 bill from the ER he went to or the fact that the other hospitals and clinics he contacted charge $400-1000 for the same thing.

The cost of the bandages and sterile supplies was probably a few dollars max. I’ll guess $10 for the tetanus shot.  NPs in NJ probably pull in about $120k with benefits, and that’s on the high side. So if he spent 10 minutes bandaging the patient and another 20 minutes writing up the charge sheet and documenting the visit, we’re looking at $60 for labor. Add in hospital overhead consumed by the patient – everyone he spoke to that helped him in his visit, and the visit likely cost the hospital about $120.

In a free market system we could draw the line there and say, “So how do you justify netting $8000 for the visit?”

But our health care system is nowhere near a free market system.

Consider the fact that hospitals cannot legally turn anyone away due to their inability to pay. I’m not a lawyer and I do believe there are limits to this, but from the hospital’s perspective they can’t have lawyers triaging patients in the ER. So they end up providing free care – free to those who receive it but paid by everyone else.

So we have to add on an “indigent care” tax to that $120. How much do we add? That’s a very good question and one that’s not easily answered, but for fun let’s say $130 – turning the visit into a $250. We’re still a long way from $8,200 but you should begin to get a sense that things aren’t as clear-cut as they should be.

Then there’s the issue of Medicaid. Hospitals have to take it, but the reimbursement costs are notoriously below the cost or providing care. Therefore to keep the hospital profitable (for the few progressives who stumble on this post substitute the phrase “from not going bankrupt” for the “P” word) we need to add the cost of treating the medicaid recipients. How much should that surcharge be? How about $50. So now we’re at $300.

The particular hospital the teacher visited is a for-profit (progressives: substitute the word “evil” here) hospital. At this point the hospital can pretty much charge what it wants, so why not $8,200? When’s the last time you walked into a hospital or doctor’s office and seen a board with a list of services and fees on the wall? That used to be a common site but now it’s almost unheard of. Go into any body shop or auto repair mechanic and you will see signs telling you how much the business charges for labor and for common procedures to your car. Yet when you walk into a doctor’s office or clinic you have no clue to what your treatment will cost even if it’s something minor like bandaging a wound or getting a tetanus shot.

This may make it seem like the doctor is doing her work because she loves it, and that the nurses are taking care of you because that’s just the kind of people that they are. But the doctor has $200k in medical school debt and a mortgage, and the nurse has a kid in day-care that needs to be clothed and fed, and “kindness” doesn’t pay back student loans, mortgages or day-care bills. You are paying a high price for that ignorance but you just don’t know it.

The people who do are the ones without insurance or the under-insured who get hassled by bill collectors, and the few people like the New Jersey teacher who think $8,200 is ridiculous regardless of who pays it.

Americans need to grow up and become responsible for their own care, but that’s the long-term solution. The issue is how do we get there? We can start by mandating transparent pricing wherever medical care is offered. The mere fact this hospital would be forced to put “Bandage a Cut – $8,000” on the wall would likely drive down the costs of the service at that particular institution. Eventually people would become aware of the limitations of their insurance and act accordingly, just as people are aware that they pay more to get their cars fixed at the dealership rather than the local mechanic down the street.

The US healthcare system is such a mess that such a simple solution isn’t going to solve everything. The key is to “do no harm” and make the system worse such as what Obamacare has done.


Ebola – Don’t Panic But Don’t Underestimate The Virus

As someone who is married to a doctor who spends her vacations in Africa treating rural villagers I take Ebola very seriously, especially since quite a few medical personnel have died from the virus. Although this virus has been infecting people since the 1970s we know very little about it. In the past it has burned itself out by pretty much killing everyone who came into contact with it in the African bush. This time around it has made it to the cities, and news stories are circulating that it has left Africa and made it to Europe and perhaps the US.

The crazies are beginning to take notice. Michael Savage has slammed the CDC for bringing two Ebola victims, an American doctor and nurse, to the US for treatment. He asks, “Why have they brought an infected doctor and another patient from the area of contagion to Emory University in the U.S. when these individuals could treated just as well in Africa? Perhaps they are using these two patients as guinea pigs in a trial for a new vaccine from which billions are to be made if successful.”

Evidently Savage has never spent time in an African hospital. I have seen my share, and if your idea of a hospital is an American public high school nurse’s office except with fewer drugs, then you have a pretty good idea of what constitutes the average African hospital. They simply do not have the resources that Emory does. Could we bring Emory over there? Perhaps in a few months sure, but the Americans had hours to live. Was there a risk to bringing them here? Absolutely, but that risk had to be weighed against the likely outcomes for the two Americans. A few weeks ago someone found a stash of old smallpox vials that had been forgotten. We’ve been experimenting with dangerous biological organisms here in the US for decades; it’s not like this is the first time a virus as notorious as Ebola has been brought to US shores. So the risk was miniscule compared to the odds against the two Americans suffering from the virus. In my view it was the right decision. Oh, and Michael, the gist of your argument makes you sound as wackadoodle as the anti-corporate progressives.

Ebola is a frightening virus, but the way forward is to combat the virus with scientific research, not throwing up the walls and cowering in fear. And it certainly isn’t by using one’s favorite whipping boy to stifle a vaccine.


SCOTUS Hobby Lobby Decision Proves Flaw of Employer Based Health Insurance

Although I support the Hobby Lobby decision rendered by the US Supreme Court, the decision merely points to a bigger problem: employer based health insurance. As an IT professional I have frequently switched jobs or worked for myself, and the health insurance coverage available to me is expensive and often non-existent. I have bought health insurance on the individual market exactly as I do with my car insurance, and the fact that the individual market is regulated to death, provides little competition unlike the auto insurance market and is outrageously more expensive is puzzling. I can spend 15 minutes to save 15% on car insurance yet it would take me twice as long to find a provider in my area and determine which insurance products were available to me then cost me twice as much just doesn’t make sense.

Paul Waldman writing for the Washington Post points out that employer based health insurance is rare in the industrialized world and is the result of an accident of history.


The system has its real roots in World War II, when the government imposed wage and price controls. Although there had been some health insurance plans sold through employers before, when companies couldn’t offer increased wages during the war, they began offering health benefits instead. When the IRS ruled that those benefits didn’t count as income and so were tax-free, the momentum toward employer-sponsored insurance was all but unstoppable (the deduction for employer-provided coverage is now the largest tax expenditure in the federal budget, dwarfing even the mortgage interest deduction).


Waldman points out that through employer based health insurance I use pre-tax dollars to pay for the insurance whereas when I buy on the individual market I have to use post-tax dollars. This makes any health insurance I purchase on the individual market more expensive depending on my tax bracket.

Now we have the IRS involved in our health insurance system. What next? The EPA to regulate the amount of carbon dioxide we exhale? The NSA to handle our medical records? How about the VA to handle appointment scheduling?  It seems to me you couldn’t design a worse health insurance system than the one we have today.

So conservatives shouldn’t cheer the Supreme Court’s decision to loudly and liberals should stop freaking out. Instead they should work together to end this crazy legacy of World War 2 so that companies can focus on making money and employees can take care of themselves as they see fit.

Update: Laurie Rice, writing for the Atlas Society, adds this:

(G)overnment involvement in the market is the reason why so many women have to get insurance through their employer in the first place. That government involvement in women’s health means today’s contraception victory is tomorrow’s political bargaining chip, to be traded by people like Kathleen Sebelius. That state power is more inescapable, more inflexible, and more insidious to women’s freedoms than any Hobby Lobby conservative craft store could ever be. Feminists need to embrace free-market capitalism.


Feminists need to embrace free-market capitalism? Given the alliance with Big Government and Leftism I’m not holding my breath.

The Coming Two-Tiered Medical System

Scott W. Atlas, writing at the Wall Street Journal, warns about the coming two-tiered medical system.

About one-third of primary-care physicians and one-fourth of specialists have already completely closed their practices to Medicaid patients. Over 52% of physicians have already limited the access that Medicare patients have to their practices, or are planning to, according to a 2012 survey by Merritt Hawkins for the Physicians Foundation. More doctors than ever already refuse Medicaid and Medicare due to inadequate payments for care, and that trend will only accelerate as government lowers reimbursements.

In order to cut costs insurance plans are narrowing their networks, removing access to the best hospitals in the country (including Barnes Hospital in my hometown.)

For cancer care, the overwhelming majority of America’s best hospitals in the National Comprehensive Cancer Network—including MD Anderson Cancer Center of Houston, New York’s Memorial Sloan-Kettering, Barnes Hospital in St. Louis, and the Seattle Cancer Care Alliance uniting doctors from Fred Hutchinson Cancer Research Center, UW Medicine and Seattle Children’s—are not covered in most of their states’ exchange plans.

Elements of this are already in place. The best paying jobs on physician job boards are “closed practices” run by large companies for their employees, or concierge practices that do not accept insurance.

Meanwhile, concierge practices are increasing rapidly, as patients who can afford it, along with many top doctors, rush to avoid the problems of an increasingly restrictive health system. The American Academy of Private Physicians estimates that there are now about 4,400 concierge physicians, 30% more than last year. In a recent Merritt Hawkins survey, about 7% to 10% of physicians planned to transition to concierge or cash-only practices in the next one to three years. With doctors already spending 22% of their time on nonclinical paperwork, they will find more government intrusion under ObamaCare regulations taking even more time away from patient care.

Moving towards socialized medicine inevitably leads to a two-tiered system. Having lived for 5 years under socialized medicine in Japan, I’ve seen the both tiers, and the quality of care diverged significantly between them to the point where we chose a private hospital for the birth of The Kid. The only question will be whether the quality of care good enough for the vast majority of Americans, or the care will stagnate and decline as the best and brightest health care providers move into the higher-paying private practices and hospitals.

Obamacare Tax Is Here for Individuals Too

Pity the small business. The federal government treats small business owners as cheats and shows them no mercy. Every month small businesses regardless of size must file payroll taxes which include the other 7.5% of each employee’s FICA plus withholding taxes. Every quarter the business also must file estimated taxes for the current fiscal year. Life is simpler for W-2 employees. Most of the work is hidden from them because if the average worker was responsible for carrying his or her share of the burden to comply with local, state and federal regulations, there would be riots in the streets. So instead governments burden the employers who must write it off as the cost of doing business in our society, and workers believe their tax refund is a “gift” from a benevolent government.

Much is being said about Matt Drudge’s “Liberty Tax”, and it’s clear that none of the critics have ever had to file a small business corporate return. If they had they’d understand how taxes are collected in this country and would recognize that Drudge isn’t lying. One issue I haven’t seen mentioned, however, is the individual penalty. Although Congress has raised the issue of delaying the individual penalty for those who opt out of Obamacare, it doesn’t appear likely to pass anytime soon, meaning that the penalty is already in force. We just don’t feel it yet.

Those who opt out, or carry a policy that doesn’t meet Obamacare’s minimum criteria of providing maternity care to men or Viagra to women, should increase their withholding amounts immediately or risk a surprise tax bill next year. How much will the penalty be? Here is an ACA Penalty Calculator that will estimate the amount due next year. For example, if you are filing as single with no dependents and make $75,000 this year, you will pay an additional $649 in 2014 rising to $1,339 next year and $1,725 the year after that (assuming 3% wage growth). Assuming the worker didn’t want to be stuck with that bill and was paid 26 times a year, she’d have to boost her withholding amount by another $25 a check this year, another $26.50 the next, and another $15 in FY2016. Things get complicated real quick with other permutations. Nothing the IRS does is simple, and handling Obamacare penalties is no different.

Most people don’t think about taxes until a few weeks before they are due, so I don’t expect this issue to get much airplay until early next year. But if you don’t have employer-sponsored health care or your plan isn’t qualified, then don’t kid yourself. You’re paying the penalty now.


The Ethics of Altered Time Perception

The Daily Mail has a thought provoking article on the use of drugs and other methods to prolong the sense of time for criminals, making their incarcerations seem longer than their actual sentences. While the article does a fair job of covering the morality of using such drugs on prisoners, it completely ignores uses of the technology for more benign purposes.

Imagine a drug one could take that could make a two day vacation feel like a month. Or prolonging those instants of joy that spontaneously arise in our lives into minutes, hours or perhaps even days. Would any of us not take a drug that would allow us mastery of time, to fight the inexorable rush forward, reducing it to a creep at certain times of our lives? There are moments we want to last forever. Soon there will be an app for that.

The article raises profound concerns about what justice means, and as the technology comes into existence we as a society should consider each of them carefully. But are we prepared at all for the opposite? Could there be a downside to stretching out those joyful moments artificially?

The Painful Implications of Invertebrates Feeling Pain

Do invertebrates feel pain? Evidently some, like crustaceans do. “Brown crabs rubbed and picked at their wound when a claw was removed, as it is in fisheries. At times the prawns and crabs would contort their limbs into awkward positions to reach the injury…”

But the same article says we don’t have to feel guilty when we smash a stink bug. “Even in extreme cases, insects show no evidence of pain. Imagine a praying mantis eating a locust, [Wageningen University professor Hans] Smid says. With its abdomen opened up, the locust will still feed even while being eaten.” Good to know because I’ve become a regular American Psycho when it comes to stink bugs.

So Science has decided that animals as simple as hermit crabs feel pain. Yet we are led to believe that human embryos and fetuses prior to birth do not, and the research that states otherwise remains controversial. This isn’t a philosophical problem for me since I eat animals and oppose laws outlawing abortion in the first trimester. I accept both are murder. But it strikes me as a bit of a conflict when my liberal friends support abortion without restriction yet won’t touch an egg because of the suffering the hen went through making it.

I’ll start taking vegans seriously when I meet one who opposes abortion for the same reason they oppose consuming animal products.

ICD-10: An Acronym Everyone Will Know Soon

Stephen Hayes has a must read article about the coming implementation of new medical coding standards known as ICD-10. I have personally met doctors who promised to retire before these standards go live in October due to their complexity. Perhaps more will quit once they learn about ICD-10’s Kafka-esque logic. For example, code T63813A is “toxic effect of contact with venomous frog, assault, initial encounter.” There is not a single venomous species of frog on the planet at this time. Oh and you can see a doctor several times for the same malady and each can be considered an “initial encounter.” Last I checked a dictionary I’m pretty sure initial had a very strong connotation of “beginning,” because the adjective “subsequent” would be used to describe encounters coming after the initial one. Not according to the geniuses behind ICD-10.

The expectation is that insurers will reject all claims due to “incorrect coding” soon after implementation, forcing the smallest providers out of business. Larger providers are expected to survive. Thinking about this though, I’m not so negative. There are already hospital administration coding specialists. While healthcare providers enter the initial codes, these specialists are used to figure out better ways to code patient treatments and educate the providers on using better codes next time. ICD-10 implementation is guaranteed to thicken this relatively new layer of bureaucracy in the health care system, perhaps by having the health care providers document the patient encounter in a traditional way, leaving the coders to determine the proper ICD-10 code later. Eventually you will have a war between the ICD-10 specialists working for providers and those working for the insurers, including the federal government. As I’ve learned with the business of Medicine or any other extremely complex system, unintended consequences are the norm. It’s way too early to predict complete disaster.

That’s the optimistic view at least, and it’s only optimistic insofar as it decreases the burden on physicians and other providers. It will not save money; that layer of bureaucracy is going to become critical and expensive, meaning that health care costs will rise. Add in the disappearance of small practices who can’t afford to implement ICD-10, and you will have fewer providers competing with each other.

The pessimistic side of course is that providers like my wife will spend even more time on on unpaid documentation than she does now, and I remind her that whatever is free is abused. For example, today she spent an hour looking up formularies and speaking to an insurance company trying to find a patient a drug her patient’s insurance company would pay for. All that time was gratis. She is therefore considering her career options, as I’m sure many providers are. Medicine is a vast field with many different ways to earn a living, and the skills she has developed will serve her well. She loves treating the sick and she still shows the passion that I saw nearly 20 years ago in the African bush when she helped African villagers. But she didn’t go through medical training to spar with desk-jockies and the coding schemes they pulled out of their asses. Everyone’s favorite example? Code V9027XA: “Drowning and submersion due to falling or jumping from burning water-skis, initial encounter.”

Who will not be served well will be the patients of the providers who leave primary care because of ICD-10, on top of the already burdensome documentation requirements, buggy and poorly written EHR software (no fax capability within the system – so the providers have to print out the prescription and carry it over to the fax machine), declining reimbursement rates, and patients who are overmedicated, overweight and over-indulged.

Here’s a tip: Make sure you get sick before the end of the year, and hope you stay healthy afterward.


Free Justina Pelletier

A family from Boston decides to take a trip across the country for a vacation. While in Nebraska their 16 year old son falls ill and is taken to an emergency room. While there a doctor notices that the son is homosexual. When confronted with this news the parents admit that yes, their son is openly gay. What the parents don’t know is that in Nebraska, homosexuality is viewed as a disease that can be cured through behavior modification techniques. The doctor suggests enrolling him in a program to treat his homosexuality. The family refuses. The state’s department of children’s services is called in. By withholding this therapy from their son, the state alleges the parents are abusing their child. The state removes him from their care, slaps a gag order on the family preventing them from discussing the situation with the Press. Later the child is placed in foster care while he undergoes aversion treatment for his homosexuality.

Sound crazy? Well this situation is actually happening to a family, except it’s not in the Midwest, it’s in the liberal Northeast. And the child isn’t gay. She has Mitochondrial Disease – a disease recognized in Europe and the United States with the exception of backwaters like Boston’s Children’s Hospital. In January 2013 she was a happy figure skater. The next month she fell ill while in Massachusetts and was taken to Children’s Hospital where a newly minted doctor denied the existence of Mitochondrial Disease and called in Children’s Services believing the parents were abusing their daughter by treating her for the condition. The State swept in, took the daughter into their care, and have limited her family to only brief supervised visits. They have forced the child psychiatric therapy of dubious scientific validity with disastrous consequences. Just over a year later the girl can’t walk anymore and is stuck in a wheelchair.

Stop for a moment and consider: The family was not refusing medical treatment. In this case the State of Massachusetts is the one refusing medical treatment. When I first saw the headline I thought that maybe they were pulling a Christian Scientist/Jehovah Witness stunt by refusing to allow medical treatment of their daughter. This is not the case with the Pelletiers, who have had several children with the disease, and whose daughter Justina was undergoing treatment at nearby Tufts University. Is Tufts some medieval institution that uses barbaric treatments on its patients? If so, then the Cleveland Clinic is guilty as well. In fact it’s more difficult to find an institution that views the disease as in the patient’s head as Children’s Hospital in Boston apparently does.

This story has been making the rounds of the right wing and libertarian blogospheres but it is also beginning to pop up on the left wing as well as this HuffPo article proves. The more I read I keep thinking there’s got to be more to the story, that something this heinous cannot happen in a modern society. A State refusing medical treatment, especially one supposedly as “progressive” as Massachusetts? This story resonates with people on the Right who are naturally shy of government intervention especially when it comes to family life. For us it’s just one more step towards state control of every detail of our personal lives. But this argument usually arises when a parent refuses a life-saving medical treatment for their child, not when the State is barring the treatment. It should also raise alarm on the Left as well, since the State’s behavior – taking a child away from her family and forcing her to undergo psychiatric therapy – is a reminder of the mental health abuses the Left attacked during the 1960’s and 1970’s that appeared in the movie One Flew Over The Cuckoo’s Nest.

It’s also yet another instance of the State telling a woman what to do with her body. I’m sure if Justina wanted to have an abortion she would be free to decide what to do with her body. So why can’t she have the same freedom to choose another treatment?

It simply does not make any sense from any perspective. The only solution is to Free Justina Now.


What Pro-Life Groups Can Learn From Death Penalty Opponents

NPR ran a story about the difficulty state governments are having acquiring the drugs they need to execute criminals using lethal injection. No American pharmaceutical companies make the drugs, and the EU bans their sale to US authorities because capital punishment is illegal in the EU. The sensible choice would be for states to source the drugs from China, which executes more people than the US and harvests their organs to boot, but currently the quality of the drugs is below standard.

Perhaps the Pro-Life movement could learn from the EU and target the makers of equipment used in abortion. Companies are very sensitive to bad publicity, especially over sales that provide a tiny fraction of their profits, and it wouldn’t take much effort on the part of Pro-Life groups to make it more difficult for abortion clinics to buy or repair equipment.

As for the states, they can get by on firing squads, the gas chamber or the electric chair. Sure the condemned prisoners will suffer more but at least death penalty opponents will be able to sleep at night, at least until the Chinese pharmaceutical companies take over.


The Dollars and Sense of a College Education

If you peruse this website you’ll see I think deeply about many subjects. Two subjects that are dear to my heart are medicine and higher education. Why? The first is obvious: I’m married to a doctor and have a nice perch from which I can view the industry’s operation and development. The second is not so obvious. Although I am a college graduate I have no particular love for my alma mater. In fact when I visited it a few years ago I was surprised by how little a connection I felt on campus. It had changed as I had, but there was something else. I felt that I had been processed, just one of thousands that graduated from the university that by-gone year. It was a very mechanical operation. I paid my money, got my card punched for the required classes I needed, and received a certificate and a handshake at a forgettable ceremony at the end.

Yet I still think about and worry about higher education. I recognize its importance in a free society, which is why I rail against its takeover by leftists and fret over its cost. I also I have a child who will soon be college age, and so I’m mindful about the choices and opportunities higher education offers him.

Medicine and higher education also share one thing in common. Their prices are completely opaque. I recently lost my health insurance as a direct result of  Obamacare, and as I get older I worry more about how long my body can last without seriously breaking down. Take for example a hernia repair. I had one done in 1999 and was similarly under-insured at the time. The price back then was $3,000 and was split 50-50 between my insurer and me. As I begin to prepare the farm for Spring (funny to think about considering I’m waiting to be walloped by a deadly winter storm as I write) I’m moving heavy things around. Every once in a while I get a twang in my lower gut on the opposite side of the repaired hernia and it scares me.

How much would a hernia operation cost me today?

I have absolutely no clue. I can go online and find the price of nearly any car. I can search real estate sites and learn the prices of houses in any neighborhood in North America. I can even find out how much companies charge to clean out my septic tank, but I cannot tell you how much the local hospitals are charging for hernia repair. All I know is that it’s probably going to cost me more than $1,500. Probably a lot more.

Why is this?

Similarly I can look up the cost of tuition at any college or university in North America. In many cases such numbers aren’t easily found, and when they are they really don’t mean much. For one thing the costs don’t include many mandatory fees that one has to pay. They also often don’t provide the cost of living one has to pay to attend. And finally, the tuition figure is a lot like “manufacturer’s suggested retail price.” Hardly anyone pays that number except for wealthy foreign students who tend not to be price sensitive thanks to their parents being members of some kleptocracy in the Third World. In most cases the cost of tuition will be lowered by need-based grants or scholarships.

Other costs are never mentioned. For example opportunity costs. For arguments sake let’s imagine that my son will attend college and graduate in four years. Not only will I have to account for the direct cost of his education such as tuition, fees and books, but I’ll have to include indirect costs like room and board, transportation, food, entertainment, clothing etc. On top of that there’s the cost of lost wages. During those four years he could have worked full time and earned say, $20,000 a year. That’s $80,000 in earnings he’s forfeited and that he will have to make up through better earning power of his degree. If he graduates and earns just $20k a year, then he’s wasted his time and I’ve wasted my money.

But by far the largest unmentioned cost is compound interest. As Einstein once said compound interest is the most powerful force in the Universe, and anyone who’s ever paid back a student loan knows he was right. Every month I cut a check to pay back the Wife’s medical school loans and the balance barely budges, and the reason it doesn’t is compound interest. Students may not understand that when they borrow $10,000 at 5% interest to attend school, they aren’t paying back $10,500 after they graduate. While they are in school that loan is capitalizing, and the interest is compounding so that by the time they pay back that $10,000 loan ten years after graduation they will have paid back $20,000 on top of the $10,000 they borrowed.

So how much does a year of college really cost?

Again, it’s difficult to say. The best I can do is estimate it.

I’ll start with my alma mater, University of California – San Diego which is to education what factory farming is to the poultry business. UCSD off-campus cost including tuition, estimated room, board, transportation is roughly $30,000 for the 2014-15 school year. I’ll assume my kid gets some grants, knocking the cost down to $25,000.

Say I throw in $15,00o leaving him to come up with $10,000. Since he’s a typical teenager, he won’t understand compound interest, so he’ll borrow his $10k and pay it off after he graduates. Because it will take time for him to pay it off, that original $10,000 will become $30,000 by the time he authorizes the last debit to his account for his student loan creditor. Adding in my original $15k means his year at my alma mater will really cost us both $45,000.

To reiterate, that’s the cost for one year at a public school in California based on the following assumptions:

  1. He graduates in 4 years. This is a big if these days. Many kids are taking 6 years or longer. The longer they take, the worse the compound interest on their student loans as the interest on the deferred loans compounds while they are in school.

  2. He gets $5,000 or roughly 17% in need based grants or scholarships. UCSD provides need-based aid to 70% of undergraduates, and some of that includes loans according to an admissions officer at the university I spoke to.

  3. I provide $15,000. That’s more than my entire stay at UCSD cost back in the 1980’s by the way…

  4. He borrows $10,000 and takes 10-15 years to repay it.

One of the dirtiest yet most effective ways to manage one’s time I’ve learned as a per-hour professional contractor is to determine the cost of whatever I’m doing or not doing in terms of a dollars per hour figure. What would it really cost my son to attend an hour long class at UCSD?

UCSD requires 180 units to graduate. So based on our assumptions that’s 45 units per school year of 30 weeks. Dividing the cost of the school year $45,000 by 30 weeks gets us $1,500 per week. In order to maintain our assumptions and finish in 4 years, our student will need to take 15 units per quarter, which translates into 15 classroom hours a week. Dividing the cost per week ($1,500) by classroom hours per week (15) provides us the cost of a classroom hour: $100.

We’ve all heard about dumb classes kids take.  Rutgers University is offering “Polticizing Beyonce” ostensibly to explore race, gender and sexual politics. Assuming Rutgers charges the same as UCSD, I wonder how popular the class would be if students had to peel off a Benjamin each time they entered the classroom. Would they be as willing to explore race, gender, and sexual politics in a classroom for the same price they could explore race, gender, and sexual politics with a moderately priced hooker in private? Granted one doesn’t have to worry about catching an STD by attending class; then again with some of the types I’ve seen on university campuses these days, I’m not so sure about that.

People alter their spending habits when they know what the price of something is and can estimate its value, and the fact that both are hidden from us whenever we consider medicine or higher education should make us stop and ponder “Why?” The free market is a ruthlessly efficient thing. If students had to pay for each class they took when they took it, one could bet that higher education spending would be revolutionized.

Universities would focus on providing better teachers that students would be willing to pay for. They would be forced to cut costs, cutting back on the administrative bloat that inflates the cost of tuition. After all, a typical undergraduate core subject class at UCSD might have as many as 150 students in it. Multiply that number by a $100, and it’s quite likely the adjunct professor teaching the class and the dozen graduate students TA’ing the course see a pittance of that $15,000, the TA’s working for free and the adjunct prof earning about $25/hour. Where did that $14,975 go?

It went several places. To pay down the loan on the new student rec center. To pay off the new training equipment for the track and field team. And on administrators, hordes of administrators, a veritable plague of administrators. As this article shows, a new study finds the number non-academic administrative employees at US colleges and universities has doubled at the same time the number of part-time faculty has grown from a third in 1987 to half of all teachers today. University presidents contend they are doing everything to cut costs, but Richard Vedder, an economist and director at The Center for College Affordability, calls them liars.

“I wouldn’t buy a used car from a university president,” said Vedder. “They’ll say, ‘We’re making moves to cut costs,’ and mention something about energy-efficient lightbulbs, and ignore the new assistant to the assistant to the associate vice provost they just hired.”

Some of my friends have commented that my arguments attack the liberal arts and that I focus too much on STEM courses that provide good job opportunities after graduation. I don’t have a grudge against the liberal arts per se. In fact one of the most useful courses in terms of my career as a systems analyst I ever took was a philosophy course on logic. Some of the English courses were excellent too in terms of value.  Being able to communicate to a broad audience is critical in business these days, yet so many students lack the basic ability of crafting a memo let alone being able to articulate complex subjects to non-technical audiences. If I could go back in time, I would happily peel off a Benjamin to pay for an hour of that logic course. It was worth it to me, and would likely be worth it to others. I’m advocating a system of price transparency and reform that will likely save such classes because the administrators who are waking up to the threat posed by parents like me are scrambling to cut costs by cutting teachers and courses instead of cutting their own jobs. Maybe Politicizing Beyonce is a great course well worth the cost, but the market, those paying for the class, should be given the opportunity to decide its true value.

Nurse Practitioners Aren’t the Solution to the Collapsing American Medical System

Let me begin by stating that my primary care provider is a nurse practitioner, as is my son’s. My mother’s is a physician’s assistant, and she trusts him more than some of her children. But let’s make something very clear: physicians, nurse practitioners and physician assistants are not the same. They do not receive the same training, do not have the same responsibilities and do not treat the same. They all have their role in health care, but you cannot replace one with the other and expect the cost of treatment to go down and quality to remain the same.

And there is no shortage of primary care physicians.

Walter Russell Mead disagrees. He quotes Amelia Thomson-Deveaux’s piece in American Prospect who argues the solution to this shortage is to allow nurse practitioners to practice on their own without supervision of a doctor.

As you know my wife is a primary care physician (PCP) practicing in a rural underserved area. I’m a systems analyst who once ran a non-profit dedicated to fighting Industry’s efforts to flood the market with cheap H1-b and L-1 visa holders from abroad as they decried a “shortage of IT workers.” There was never a shortage of IT workers, just a shortage of those willing to work for the money IT companies wanted to pay.

Why is it that people become irrational when talking about professionals? If the price of something goes up, it means demand outstrips supply. This is a concept we innately understand. We know that the price will remain high until demand weakens, or the high price encourages producers to expand supply. This combination of reduced demand and increased supply inevitably leads to the price of that something declining. It could be natural gas, LCD televisions or salaries.

There is no shortage of primary care physicians. There is a shortage of PCPs willing to work long hours in disadvantaged areas for less money.  I’d love to see where that $189k average PCP salary quoted by Thomson-Deveaux comes from because it sure isn’t paid out here in the Styx. Salaries out here should be higher to encourage docs to come here, and they are somewhat higher than in big metropolitan areas with lots of amenities. But a shortage means salaries are rising, and they should be rising faster out here than elsewhere – but they aren’t. Why not? Because there is no shortage.

The shortage is a myth perpetuated by those who want to manipulate the market to their advantage. Hospitals want nurse practitioners because those in our area are paid $50k per year, roughly 2.5x less than the average PCP salary here, but they bill out at 75% of a PCP. NP associations are working to remove obstacles for allowing NPs to practice unsupervised. That’s fine – as long as physicians aren’t held accountable for their mistakes.

There is a reason a primary care physician goes through 4 years of medical school, followed by 3 years of residency and internship: exposure to a much broader range of conditions and treatment modalities than an NP receives. According to the American Academy of Family Physicians, a family physician receives 21,700 hours of training verses 5,300 for a nurse practitioner. This added training teaches doctors to differentiate between horses and zebras, to know when a condition is presented is either common or uncommon, and to do so without additional tests.

NPs order more tests than physicians, and since those tests are conducted often within their practice or hospital, these tests benefit the providers who pay them. But the cost of that testing is then passed to the insurance company and patient, so they do not benefit from the lower salaries paid to NPs, while the patients suffer the consequences of inexperienced care. Most of the time it won’t matter – remember, I go to an NP  as does my teenage son – but I’m healthy as is he. It would be a different matter if one of us were chronically sick.

KevinMD believes this argument between family physicians and nurse practitioners is a red herring. The problems with primary care go way beyond the threat posed to PCPs by nurse practitioners. He cites statistics showing specialists providing 41% of primary care office visits. He believes this is due to patients skipping the gate-keeping role of the PCP and going directly to the specialist because of the perception that they are more qualified. There is no reason for someone with a cough to see a pulmonologist unless he has been directed there by a primary care physician  first. This only makes sense because a patient does not incur the cost of seeing the specialist beyond the extra few dollars in the co-pay.

Look, everyone knows the medical system in the USA is a disaster. I’ve lived under socialized medicine (the Kid was even born under it), and I’m not instinctively opposed to it the way some are. But we need to be honest about the problems and avoid scapegoats; there is plenty of blame to go around, starting with the patients themselves. But that’s another essay…

What a Survey of 1,400 Sued Doctors Can Tell Us About Health Care Reform

Ever wonder how malpractice lawsuits turn out and what their effects on physicians are? Then click here for a slideshow showing the results of a study of 1,400 physicians who were sued for malpractice. There are several interesting points to take from this survey, including the fact that the majority of plaintiffs, 57%, received no monetary reward. But the one thing that stands out by far should be the advice these doctors give on slide 22:

  • Follow up even when you think you don’t have to.

  • Practice more defensive medicine.

  • Document more often, more thoroughly.

  • Get rid of rude, demanding, noncompliant patients.

Anyone who expects doctors, particularly primary care physicians (who also happen to be the most likely to be sued) to take on the responsibility of lowering health care costs by ordering fewer unnecessary tests and procedures (I’m looking at you Professor Mead) are simply delusional. Doctors do not have any incentive to stop ordering these procedures, quite the opposite. Whenever they rule out a particular test they must consider a bullet-proof and infallible reason why the test is not required in case they have to testify on the Stand to support their decision. In medicine, as in life, there are few situations that can attain such a level of infallibility. A runny nose can indicate a cold or allergy in a hundred thousand cases but it can also can result from a leak of cerebral-spinal fluid into the nasal cavity in rare instances. Should a doctor order the highly invasive – and expensive – test to rule out this leak in the snot-faced six year old kid sniffling in front of her? This is an extreme example of course, but the point stands: why should doctors risk being sued, a type of punishment judging by the emotional toll the survey shows,  for trying to contain costs?

It would seem to me that if you want to reduce unnecessary testing you would address the reasons why they are ordered in the first place, yet this has not been done. While some states have attempted to limit the maximum amount a  plaintiff can be awarded from a successful malpractice suit, none have made laws to make it harder to file them in the first place. The cynic may see the hand of self-interest here, with the lawyers who write the laws the ones also profiting from malpractice lawsuits. After all, scientifically dubious malpractice lawsuits almost elevated former Sen. John Edwards to the White House. But to ask doctors to refrain from ordering unnecessary tests and procedures without legal reform is like asking them to commit professional suicide.

The last item is particularly interesting. Legally doctors in private practice do not have to treat everyone who comes through the door. They can turn down patients for any reason. Once they establish a relationship with a patient they can also terminate that care at any time as long as they do not abandon them, usually by offering to care for them for a period of time when they can establish care with another provider. Many medical system reformers have talked zealously about basing payments to doctors on the success based measures, for example, on how well their diabetes patients’ blood sugar levels are controlled. Every practice has a coterie of diabetes patients who are non-compliant. They come in suffering from associated illnesses and for whatever reason refuse to control their blood sugar levels through exercise and diet, then expect the doctor to fix them. Such outcome based reimbursement schemes will only lead to doctors drafting letters telling these patients to find another provider. But even for doctors who aren’t reimbursed partly based on outcomes, it is in their interest to get rid of these patients who are more likely to complain and perhaps sue them.

Doctors have done a poor job at getting their point across in the health care debate in America. This is partly due to the nature of the profession, which tends to operate in solo or small groups and not think in broader terms the way other professions such as teachers and lawyers have done. It is also due to the corruption of the American Medical Association through years of operation in Washington DC reaching it’s pinnacle in the organization’s support of Obamacare in 2010 against the best interests of its own membership (but in line with the leftist ideology of the organization’s staff). But doctors had better learn quickly because if they don’t their profession will become extinct, and the healthcare of Americans will be even worse than it is today.


Primary Care Physicians: Between A Rock and a Hard Place

I’m the husband of a primary care physician and although I may be biased I’m not stupid. I’m intelligent enough to recognize my own biases and think around them. Besides like everyone else I’m human and consume health care as does my Wife. People seem to forget that every doctor is also a patient at one time or another, and while one might think the White Coat gets you special treatment from other doctors, it doesn’t. For example the Wife had to wait 3 months to see a GI specialist just like her patients do. She refers to this specialist all the time but that didn’t get her special treatment. I was actually annoyed and told her, “But you send this guy revenue. The least he can do is give you a kickback by fitting you into his schedule.” I come from a long line of Democrats, so corruption is in my genes. She said she had to wait like everyone else.

We know health care is a mess in the United States and recognize it’s a complex problem. So whenever someone comes up with a bright, simple solution, or as is often the case the sole blame for the mess, it’s always wrong. Are lawyers and malpractice suits the sole cause of our system’s dysfunction? No.  Inflated doctors salaries? Nope. Greedy health insurance companies? No. The system is so bad now that there is plenty of blame to go around for everyone – and I do mean everyone. The system is so corrupted that if you even touch it you become part of the problem. No one seems to get that.

The esteemed Walter Russell Mead has written extensively about the health care crisis in America but lately has been falling into a trap where he focuses his blame on doctors. Case in point: A recent survey of doctors conducted by the Journal of Medicine that found the vast majority of physicians see themselves as having some responsibility for holding down health costs, but saw themselves as a minor contributor compared to other groups.

“What physicians are trying to tell us is that they don’t see themselves as necessarily any more responsible for health care costs than all of those stakeholders,” said Dr. Jon Tilburt, an associate professor at the Mayo Clinic and the study’s lead author. “They see themselves as a contributor, not a main contributor,” he added.”

Mead takes issue with this statement. “(Doctors) seem (to) overlook the fact that the current system, based on fee-for-service payments, is stacked in favor of the doctors. Health care can probably never be a fully level playing field. But if patients could inform themselves about prices before going through with various tests and treatments, they could contribute to lowering costs by opting out of unnecessary or overly expensive ones.”

Evidently Mead has forgotten the problem caused by insurance. If a patient patient pays only the fraction of the total cost of a procedure through his deductible and co-payment, there is no incentive for him to forgo the procedure. For example, a Medicaid patient comes into the office with a sprained wrist and demands an MRI. The primary care physician may examine the wrist and if she suspects it’s broken, perhaps orders an X-ray. But the patient will not be happy unless she gets an MRI, a procedure whose costs are not borne by the patient  but by the state’s taxpayer (in the case of Medicaid) or other policyholders (if privately insured). Publicly funded insurance schemes like Medicaid and Medicare particularly are ripe for abuse. Patients demand all types of medicines and procedures because they bear so little of the cost. With $3 copays doctors visits for minor ailments such as colds or the ubiquitous “sinus infection” cannot be discouraged, contributing to overuse of the medical system. Dr. Wife has been trying to do her part to stop the overuse of antibiotics, but she has been challenged by patients who insist on getting one even if taking it can cause other problems, believing that they are not getting their money’s worth unless they go home with a pill.

Patients are exhibiting signs of viewing medicine as a service industry, like a restaurant where they can order and eat whatever they want but then aren’t responsible for the bill.  In the case of the MRI, a diagnostic test that wasn’t warranted by the complaint, the woman complained to the staff about the Wife’s refusal to order it, and threatened to badmouth the practice to her friends. Since the Wife is paid according to a system that is based on the number of patients she sees, such a complaint could impact her salary. Such patients aren’t rare, and are increasingly becoming the norm. After diagnosing a patient with a minor stomach ailment the patient told the staff, “$25 and I’m told to eat yogurt.” People aren’t interested in treating their ailments; they are interested in only treatments that are active, invasive and often expensive. Their expectations and concepts of health care are seriously out of whack.

Doctors have known for years that the happiest patients are the ones who get what they want, whether its antibiotics for colds or even pain pills. There’s a scene from an episode of the British comedy “Doc Martin”, a series about a socially inept and rude but brilliantly skilled general practitioner who takes up residence in a small Cornish seaside town, when he visits the local pharmacy and learns the doctor who replaced him prescribed inappropriate treatments to his patients. “You didn’t give me these pills,” one patient says chirps, obviously glad to have a different GP, “But she did.” Dr. Martin answers “You have asthma, and those beta-blockers will kill you.”

Doctors who practice “evidence based medicine” where they do not prescribe or treat unless the illness warrants it aren’t popular with patients who are emboldened by the Internet and commercials telling them to “talk to their doctor” about the latest pharmaceutical wonder drug that doesn’t outperform existing lower-cost generics. Will they be happy with the cheaper generic instead of the pill they see on TV? As long as they are shielded from the full cost of that pill through a low co-pay, it is unlikely.  So should the doctor prescribe the new pill and make the patient happy or the generic and risk an unhappy patient who may not come back or worse, bad mouth him to their friends? Is the customer, or patient, always right? Or should the doctor always give the patient what is in his or her best interest? Most doctors strike a balance between the extremes but as patients see doctors more like waiters in a restaurant and less as health care ally it will be harder for doctors to balance doing the right thing by the patient while making him or her happy, especially when doing so can lead to negative reviews on Yelp! or its medical practitioner equivalent.

Mead is also a fan of cheaper medicine provided by physician assistants and nurse practitioners. These are mid-levels with less training than physicians who in most states must be supervised by doctors. Doctors are not paid for this extra supervision yet are the ones held responsible for any mistakes done by the mid-levels under their supervision. Some health care systems are replacing doctors with these mid-levels, finding mid-levels are able to bill at roughly the same rate as doctors yet cost half as much. Traditionally primary care physicians were viewed as the gate-keepers to specialists and inpatient admissions where the real money was made by hospitals and health care systems, so primary care practices weren’t expected to be profitable. That has changed and primary care practices are expected to be profitable as well maintaining their traditional referral role. Mid-levels are key to that profitability.

But do patients really benefit from the lesser trained mid-level? In the vast majority of cases a mid-level can offer care as good care as a physician.  Since mid-levels are salaried they can spend more time with patients unlike physicians who are on productivity or paid by RVU. Where physicians excel is their additional experience and training for less common illnesses and disease processes. A doctor receives several extra years worth of training to differentiate the sounds of horses and zebras, as the old adage goes about recognizing the difference between common and uncommon disease processes. A nurse practitioner may recognize the sound of horse hoof-beats but does he recognize the sound a zebra’s hooves make? Do mid-levels order more tests than physicians to make up for their lack of training? That is a study I would like to see done, and if true would encourage health care systems to continue to replace physicians with them because extra testing generates even more revenue for hospitals. From a payer’s perspective the overall benefit of the mid-level may be lost through the additional testing costs.

As mid-levels are added to the rosters of practices and hospitals either doctors will have to be compensated for taking on the added oversight and risk (doctors can be sued for malpractice for mistakes made by the mid-level they are supervising), or the system and patient expectations will have to change to accommodate them.

There are very good reasons why medical students vote with their feet and avoid primary care specialties. GPs are earning less and seeing more patients to compete with cheaper nurse practitioners and physician assistants. They are becoming overwhelmed with paperwork, all of it unpaid: employees needing doctor’s notes for time off, requests for electric scooters, treatment justifications from insurance companies who refuse to cover a procedure or medicine, prescription refill requests, lab results and patient notes. Paperwork is free and like anything that is free it gets abused and grows; attempts at taming the paperwork beast like the panacea offered by electronic record system adoption simply lead to even more paperwork. Some systems have cost hospitals nearly a billion dollars EACH to implement, an investment that threatens some with bankruptcy and leads to even more pressure on staff to pack the patients in. Most primary care physicians just want to do what they’ve been trained to do, practice medicine and do what’s right by the patient. Instead they have become unwitting players in a vast economic and social experiment.

There are many intelligent people in the health care debate with many ideas and contrasting positions. The system is so screwed up there is plenty of blame to go around. We need more people like Walter Russell Mead to weigh in on the subject but only if they accept the truism, attributed to Einstein, Churchill and even HL Mencken that for every complex problem there is a simple solution, and it’s wrong.

UPDATE: See this essay for what a survey of 1,400 sued doctors tells us about health care reform.

Obamacare Rate Shock In California

Although I’ve been characterized as a rabid right winger on some topics, by my wife no less, when it comes to health care I’m pretty open minded and non-dogmatic. As recently as 2006 I had advocated for a single-payer system aka “socialized medicine” arguing that health care is similar a public good as fire and police protection. What changed my opinion was the government involvement in the economy in 2008-09 with the default nationalization of General Motors, AIG and a large swathe of the banking industry. While there may be good reason for government involvement in the health care industry, such involvement cannot be done in an environment whereby the government is expanding its reach in other areas. That’s why I have switched my viewpoint towards a more libertarian one whereby the federal government’s power is curtailed throughout society, and that includes in the health care industry.

But I am open to what works. Our son was born under socialized medicine in Japan, and I am familiar with its benefits and drawbacks first-hand. I remain at least in principle more accommodating to the idea than most libertarians and conservatives, as long as it works. We live in a medical system that is the most expensive in the world yet provides middling care, one that provides perverse incentives to participants that work against cost containment and better quality of care, and one with bureaucracies – that’s plural – which go beyond the Byzantine to the Kafkaesque. It’s a system that is loathed by anyone with “skin in the game,” from care givers to care receivers. It’s only the bureaucrats who delight in it and those who benefit monetarily and politically from the current regime. For most the system is collapsing, but slowly and painfully.

Obamacare makes the situation worse, which is why the conspiracy minded have viewed it as a  morphine overdose  that destroys the system and allows its replacement by socialized medicine. Honestly at this point, I’m not sure this would be a bad thing given what I’ve been seeing with Obamacare.

Last week Obamacare supporters were trumpeting cost containment. Evidently they grabbed their tin horns too quickly. It turns out that Californians, particularly the young and healthy that will be forced by law to buy insurance if its not provided by their employers, will face rate hikes as high as 146%. A catastrophic plan for a healthy 25 year old today costs roughly $92/month. After January 1, 2014 the same plan will double to $184/month.  While an extra $92 isn’t a lot to me, I remember the time particularly when I was starting my career with a young family in my late 20’s when it was. That was a week’s worth of groceries back then. Perhaps today’s 20-somethings are wealthier than I was when I was their age, but given the job climate I doubt it.

Perhaps today’s 20-somethings are much more idealistic than I was back in the day and believe Obamacare will work for them, but it seems to me that it is the continued war on the young as the rates are meant to keep costs down for older and wealthier rate payers. When I was their age I went without health insurance; that is not an option for them today.