President Obama continues to bring feelings to a fact fight. He pontificates that mandated universal health care will control health care costs and is good for a failing economy. Yet, he lived in Hawaii which has failed at mandated universal health care coverage making one wonder, just how bad was his cocaine usage?
In 1994, First Lady Hillary Rodham Clinton declared, “The only place that has achieved nearly universal coverage and has less of a cost burden on its system is Hawaii.” The Clinton administration was so impressed with Hawaii, it got Congress to fund the QUEST program for the 2% uninsured most of whom were suffering from expensive chronic problems that private insurers avoid. Unfortunately, Ms. Clinton’s words contrast with the inconvenient facts because Hawaii’s employer mandate had a significant “cost burden” on small businesses and consequently on the uninsured. Since 1993, Hawaii has not been able to control premium inflation and in 2002 the uninsured levels in Hawaii were reported to be 9.7 percent. The small business problems have existed since the 1990 economic recovery evidenced by Hawaii’s 49th ranking in income growth, 43rd ranking in employment growth rate, the worst business bankruptcy rate and new business growth ranked 48th.
Massachusetts's universal health proponents felt mandating health insurance would cut premium costs 35-45% because the healthy 18-35 population would be contributing with minimal claims and the newly insured poor would forego ERs for cheaper access to primary care. Again, the inconvenient facts have struck liberal land and premiums are growing 7-13% annually and the insured poor are still using the ER rather than a primary care physician at a high rate.
Maine's Dirigo Health based its universal health success on eliminating "charity and bad debt" with a state run insurer not seeking profits or employing high salaried executives. It had one of the nation's "25 Most Powerful Women In Health Care" leading the effort but Dirigo Health has failed to insure the 135,000 it promised, has restricted enrollment, can not controlled costs and insures less than 9000 individuals.
These failed efforts at universal health care are the inconvenient facts that the Democratic Party, President Obama, the New York and Washington media quietly ignore. Not until health care reform focuses on reversing the costs projectory by inspiring the health care delivery system to be in the constant pursuit of excellence will health insurance premiums be affordable. And government mandating affordability through price controls and mandates is the fastest projectory to hyper inflation in health care.
Friday, November 20, 2009
Thursday, October 8, 2009
Health Care Reform Needs Democrats To Be Smarter Than A Fifth Grader
If a dog owner reduced a dog's daily ration one ounce every time the dog pooped or peeped outdoors but when the dog pooped or peeped indoors, he added a treat to the daily ration, there would be a lot of "waste" in the house. This is exactly what government health care programs have been encouraging for decades.
President Obama's own economic advisers reported in June 2009 (page 14) that government health care programs do not pay for quality care or value, but do pay for poor quality. Today, Democrats are blaming all the "waste" in government on everyone but government's perverse incentives for causing the 30-40 percent "waste" in health care. A fifth grader would know that paying health care providers for excellence and never preventable failure would take the "waste" out of health care. Instead, the Democratic Party and the President are about to take "waste" to a higher level by giving the federal government more tax and control power that will accelerate the perverse incentives and implement stealth taxes that will mask the real cost of a government controlled health care delivery system. If you think the status quo is wasteful and chaotic today, wait until five years of ObamaCare on government steroids has past.
President Obama's own economic advisers reported in June 2009 (page 14) that government health care programs do not pay for quality care or value, but do pay for poor quality. Today, Democrats are blaming all the "waste" in government on everyone but government's perverse incentives for causing the 30-40 percent "waste" in health care. A fifth grader would know that paying health care providers for excellence and never preventable failure would take the "waste" out of health care. Instead, the Democratic Party and the President are about to take "waste" to a higher level by giving the federal government more tax and control power that will accelerate the perverse incentives and implement stealth taxes that will mask the real cost of a government controlled health care delivery system. If you think the status quo is wasteful and chaotic today, wait until five years of ObamaCare on government steroids has past.
Thursday, September 10, 2009
Decade Old Concept Drives Dallas, Texas Health Care Reform...Maybe
While ObamaCare seeks a strategy for health care reform, Dallas is moving towards what I call a community integrated delivery system (CIDS) to curb inflation. A decade old concept based on Steven Covey’s maturity continuum, CIDS applies these characteristics to health care entities progressing from dependence (what you can do for me), to independence (what I can do for you) to interdependence (what we can do together). CIDS hypothesizes that a true paradigm shift in health care would occur when a coalition of physicians, community leaders, consumers, insurers, hospitals, etc., like Dallas is presently assembling, collaborate to evolve their role in the health care delivery system from dependency to interdependency.
Grand Junction, Colorado without a matrix like CIDS made news with the lowest cost per Medicare patient in the nation while achieving quality outcomes. The achievement reflected years of physicians, at the behest of a major health plan, reaching the independent stage by collaborating to manage patient outcomes. A CIDS model would have been more inclusive giving Grand Junction a greater opportunity to reaching the interdependent stage and the political power to address government’s perverse reimbursement system that underpays excellence and rewards failure.
In contrasts, McAllen, Texas the nation’s highest costs per Medicare patient in the third most expensive state represents the dependency stage. Its health care providers have been described as clueless in seeing the big picture, quick to blame forces around them, convinced they are providing necessary and essential care but the evidence says they pursue revenue “for me” and not excellence “for you.”
If the Dallas coalition lowers costs just 22%, it will equal the national average strengthening its role as a regional health care provider while cutting a major cost in their economy; a win/win for everyone. If they reach the interdependent stage, Dallas will be the nation's high value model for free market health care reform facilitated by the community not controlled by a central government entity.
Grand Junction, Colorado without a matrix like CIDS made news with the lowest cost per Medicare patient in the nation while achieving quality outcomes. The achievement reflected years of physicians, at the behest of a major health plan, reaching the independent stage by collaborating to manage patient outcomes. A CIDS model would have been more inclusive giving Grand Junction a greater opportunity to reaching the interdependent stage and the political power to address government’s perverse reimbursement system that underpays excellence and rewards failure.
In contrasts, McAllen, Texas the nation’s highest costs per Medicare patient in the third most expensive state represents the dependency stage. Its health care providers have been described as clueless in seeing the big picture, quick to blame forces around them, convinced they are providing necessary and essential care but the evidence says they pursue revenue “for me” and not excellence “for you.”
If the Dallas coalition lowers costs just 22%, it will equal the national average strengthening its role as a regional health care provider while cutting a major cost in their economy; a win/win for everyone. If they reach the interdependent stage, Dallas will be the nation's high value model for free market health care reform facilitated by the community not controlled by a central government entity.
Friday, August 14, 2009
ObamaCare Allows Easy Wrong To Trump Harder Right
President Obama wants to eliminate health care waste by expanding the present cause of waste through a public option: squeezing provider payments. He calls this taking the “harder right over the easier wrong.” Reform is supposed to improve or correct what is corrupt or defective which is government’s squeezing provider payment system. Described by the Executive Office of the President Council of Economic Advisers (CEA) as not rewarding higher quality and value, but does reward poor quality. In other words, government underpays excellence and uses the savings to pay for failure. A fifth grader would call this the “easier wrong” and reverse the incentives. But somehow a common sense solution is lost on the Democrats that divert blame to market failures and provider inefficiencies as the cause of the nation’s health care crisis.
Squeezing has been in place since 1983 when the Center for Medicare and Medicaid Services (CMS) introduced diagnosis related groups (DRGs) hoping revenue pain wou ld encourage efficiency gains. Even with the addition of the Medicare Payment Advisory Commission (MedPAC) pain-for-efficiency-gain strategies are failing evidenced by Medicare’s projected bankruptcy in 2019. Not deterred by these failures, the federal government wants more control over individual health care not unlike the long term care industry.
The long term care industry is the second most regulated of all industries. For decades, government injected “best practice” and preventive care mandates, squeezed provider payments, imprisonment and fines legislation, annual and unannounced inspections, hot lines for patient abuse, web sites for provider comparison etc. to control costs and quality. Even daily sleeping, eating, smoking, drinking, weight, medication, recreation, etc patterns are regulated. In theory, it is the political left’s utopia presently driving health care reform. In reality it has been a regulated failure because providers are driven to be compliant with mediocrity rather than inspired to pursue excellence.
The “harder right” is to understand how squeezing has corrupted operational efficiencies and then how to inspire the constant pursuit of excellence in operational efficiencies, the rails quality travels to excellence in patient and financial outcomes. Squeezing is never efficient because it limits the costs of inputs without evaluating the processes that impact patient outcomes which adds preventable costs. Whereas pursuing excellence in operational efficiencies eliminates waste in inputs while continuously evaluating processes to assure outcomes are not compromised adding wasteful costs.
When CMS placed a value on squeezing payments with no equal value on outcomes, most providers adopted the same perverse value system. The focus was surviving the squeeze by cutting inputs including patient care staffs. This created conditions for preventable medical errors cited as inefficiencies in the CEA June 2009 report and major contributors to the quality chasm identified by the Institute of Medicine in 1999.
On May 3, 2001, Janet M. Corrigan of the National Quality Forum before a U.S. Senate committee stated, “I want to emphasize that errors are seldom due to carelessness or lack of trying hard enough on the part of health care professionals. More commonly, errors are caused by faulty systems, processes, and conditions that lead people to make mistakes.” Ms. Corrigan describes the organized chaos caused by government squeezing. Few transcend this perverse value system the “hard right” way and there lays the problem and the solution.
Intermountain Healthcare in Utah in 2003 made news for being punished by Medicare $700 per patient when pursuing excellence while being nicely rewarded for failing. Intermountain’s res ponse reflects what all health systems do to survive the punishment of squeezed payments: inflate charges paid by private insurers. What each does with the recouped funds separates efficient from inefficient behavior cited by the CEA.
Enlightened leadership, like Intermountain, takes the less traveled path of investing subsidies into the constant pursuit of operational efficiencies resulting in costs 33% less than national averages while achieving a quality driven culture. Mayo Clinic also takes the enlightened path saving 25% while being the second most quality driven health care system in the U.S. Yet, Mayo has cautioned the “easy wrong” way of universal squeezing would eliminate private insurer subsidies and the nation’s best providers. Is anyone listening with the courage to act?
Unenlightened leadership uses subsidies to reward the status quo’s insatiable cost of operational inefficiencies which is never sufficient making new revenue sources a constant pursuit. These sources can be high cost, low-value treatments or care in the least cost-effective manner cited by the CEA as inefficient. By diverting blame on these symptoms of squeezing, the CEA allows the president to hail squeezing as the solution.
Unfortunately, the inefficient status quo quickly shrinks these margins forcing leadership to be on the continuous pursuit for new high margin services rather than operational efficiencies. The CEA calls this “a strong financial incentive to compete on the basis of technology adoption rather than price.” When in reality, it is not competition that always benefits the community, but rather a perverted twist to competition where providers race to be first with a new high margin service to cover their costs of inefficiencies and squeezing losses.
If CMS had focused on patient outcomes in 1983, it would have implemented a payment system that paid for excellence and never preventable medical errors while utilizing best practices in operational efficiencies as a basis to developing payment schedules. This would have given providers the financial resources and incentive to be innovative in the constant pursuit of operational efficiencies leading to a quality driven culture with minimal waste.
If reform inspired providers rather than making it harder to pursue the operational efficiencies levels of Intermountain and Mayo, the nation would save $625-$825 billion of the $2.5 trillion spent annually allowing health care reform to be measurable, sustainable, universal, and self-funding with no new taxes or rationing.
In 2006, North Carolina Medicaid reversed its perverse payment system and paid all physicians more for excell ence and inspired health care professionals saved the state 11% over 2005 when physician payments were squeezed. The American Academy of Family Physicians reported that this pay-now-save-immediately policy gave physicians the financial resources to better manage and coordinate patient care on an ongoing basis resulting in fewer ER visits and hospitalizations reducing unnecessary medical costs. Immediate savings, inspired physicians, improved patient access; are not these reform goals?
Adam Smith, moral philosopher and free market theorist, hypothesized that the “invisible hand” of “self-interest promotes the interest of society only when the producer responds to the needs of the customer.” When Mayo and Intermountain’s act of “self-interest” is to serve society with excellent care and government squeezing makes it financially destructive jeopardizing the needs of the patient; then government is perverting the “invisible hand” theory and is responsible for a failed health care market. Not the providers who are forced to accept squeezing and “competing” private insurers that are forced to accept provider losses from government squeezing that the Democrats w hat us to believe.
The “easier wrong” is a public option universally squeezing payments the primary cause of an inefficient, quality challenged health care delivery system. The “hard right” is to increase best providers by paying health care professionals for excellence and never preventable failure so they have the resources and incentives to be in the constant pursuit of the most efficient, delivery of quality, universal, integrated care. The “harder right” inspires providers to sacrifice waste to pay the way and the “easier wrong” sacrifices patient care and provider freedom while increasing taxes. Which will Congress choose?
Squeezing has been in place since 1983 when the Center for Medicare and Medicaid Services (CMS) introduced diagnosis related groups (DRGs) hoping revenue pain wou ld encourage efficiency gains. Even with the addition of the Medicare Payment Advisory Commission (MedPAC) pain-for-efficiency-gain strategies are failing evidenced by Medicare’s projected bankruptcy in 2019. Not deterred by these failures, the federal government wants more control over individual health care not unlike the long term care industry.
The long term care industry is the second most regulated of all industries. For decades, government injected “best practice” and preventive care mandates, squeezed provider payments, imprisonment and fines legislation, annual and unannounced inspections, hot lines for patient abuse, web sites for provider comparison etc. to control costs and quality. Even daily sleeping, eating, smoking, drinking, weight, medication, recreation, etc patterns are regulated. In theory, it is the political left’s utopia presently driving health care reform. In reality it has been a regulated failure because providers are driven to be compliant with mediocrity rather than inspired to pursue excellence.
The “harder right” is to understand how squeezing has corrupted operational efficiencies and then how to inspire the constant pursuit of excellence in operational efficiencies, the rails quality travels to excellence in patient and financial outcomes. Squeezing is never efficient because it limits the costs of inputs without evaluating the processes that impact patient outcomes which adds preventable costs. Whereas pursuing excellence in operational efficiencies eliminates waste in inputs while continuously evaluating processes to assure outcomes are not compromised adding wasteful costs.
When CMS placed a value on squeezing payments with no equal value on outcomes, most providers adopted the same perverse value system. The focus was surviving the squeeze by cutting inputs including patient care staffs. This created conditions for preventable medical errors cited as inefficiencies in the CEA June 2009 report and major contributors to the quality chasm identified by the Institute of Medicine in 1999.
On May 3, 2001, Janet M. Corrigan of the National Quality Forum before a U.S. Senate committee stated, “I want to emphasize that errors are seldom due to carelessness or lack of trying hard enough on the part of health care professionals. More commonly, errors are caused by faulty systems, processes, and conditions that lead people to make mistakes.” Ms. Corrigan describes the organized chaos caused by government squeezing. Few transcend this perverse value system the “hard right” way and there lays the problem and the solution.
Intermountain Healthcare in Utah in 2003 made news for being punished by Medicare $700 per patient when pursuing excellence while being nicely rewarded for failing. Intermountain’s res ponse reflects what all health systems do to survive the punishment of squeezed payments: inflate charges paid by private insurers. What each does with the recouped funds separates efficient from inefficient behavior cited by the CEA.
Enlightened leadership, like Intermountain, takes the less traveled path of investing subsidies into the constant pursuit of operational efficiencies resulting in costs 33% less than national averages while achieving a quality driven culture. Mayo Clinic also takes the enlightened path saving 25% while being the second most quality driven health care system in the U.S. Yet, Mayo has cautioned the “easy wrong” way of universal squeezing would eliminate private insurer subsidies and the nation’s best providers. Is anyone listening with the courage to act?
Unenlightened leadership uses subsidies to reward the status quo’s insatiable cost of operational inefficiencies which is never sufficient making new revenue sources a constant pursuit. These sources can be high cost, low-value treatments or care in the least cost-effective manner cited by the CEA as inefficient. By diverting blame on these symptoms of squeezing, the CEA allows the president to hail squeezing as the solution.
Unfortunately, the inefficient status quo quickly shrinks these margins forcing leadership to be on the continuous pursuit for new high margin services rather than operational efficiencies. The CEA calls this “a strong financial incentive to compete on the basis of technology adoption rather than price.” When in reality, it is not competition that always benefits the community, but rather a perverted twist to competition where providers race to be first with a new high margin service to cover their costs of inefficiencies and squeezing losses.
If CMS had focused on patient outcomes in 1983, it would have implemented a payment system that paid for excellence and never preventable medical errors while utilizing best practices in operational efficiencies as a basis to developing payment schedules. This would have given providers the financial resources and incentive to be innovative in the constant pursuit of operational efficiencies leading to a quality driven culture with minimal waste.
If reform inspired providers rather than making it harder to pursue the operational efficiencies levels of Intermountain and Mayo, the nation would save $625-$825 billion of the $2.5 trillion spent annually allowing health care reform to be measurable, sustainable, universal, and self-funding with no new taxes or rationing.
In 2006, North Carolina Medicaid reversed its perverse payment system and paid all physicians more for excell ence and inspired health care professionals saved the state 11% over 2005 when physician payments were squeezed. The American Academy of Family Physicians reported that this pay-now-save-immediately policy gave physicians the financial resources to better manage and coordinate patient care on an ongoing basis resulting in fewer ER visits and hospitalizations reducing unnecessary medical costs. Immediate savings, inspired physicians, improved patient access; are not these reform goals?
Adam Smith, moral philosopher and free market theorist, hypothesized that the “invisible hand” of “self-interest promotes the interest of society only when the producer responds to the needs of the customer.” When Mayo and Intermountain’s act of “self-interest” is to serve society with excellent care and government squeezing makes it financially destructive jeopardizing the needs of the patient; then government is perverting the “invisible hand” theory and is responsible for a failed health care market. Not the providers who are forced to accept squeezing and “competing” private insurers that are forced to accept provider losses from government squeezing that the Democrats w hat us to believe.
The “easier wrong” is a public option universally squeezing payments the primary cause of an inefficient, quality challenged health care delivery system. The “hard right” is to increase best providers by paying health care professionals for excellence and never preventable failure so they have the resources and incentives to be in the constant pursuit of the most efficient, delivery of quality, universal, integrated care. The “harder right” inspires providers to sacrifice waste to pay the way and the “easier wrong” sacrifices patient care and provider freedom while increasing taxes. Which will Congress choose?
Thursday, May 14, 2009
2005 Prediction That Maine's Dirigo Health Would Fail
The predictable failure of Maine's effort at universal care will be the same for ObamaCare if it fails to inspire the health care delivery system. We know from history that Medicare purchasing power is more apt to expire a hospital or medical practice than inspire health care professionals. The following article addressed the fate of Maine's failing Dirigo Health program
Dirigo Health: 'dead program spending'
04/22/2005 By R Daniel King, Times Record Contributor
Dirigo Health is sadly a "dead program spending." The executive director of the Governor's Office of Health Policy and Finance recently reminded us that the "Legislature enacted Dirigo Health to reduce our health care costs, improve quality and increase access to coverage." Yet none of the strategies the office has chosen has any remarkable history achieving these goals.
The office does not acknowledge it rewards failure in quality and efficiency, so quality and cost will continue to deteriorate. DirigoChoice enrollment increases are offset by mandated decreases in MaineCare enrollment, adding to bad debt and charity. The office failed to inspire the hospital industry with old control and fear tactics and now will attempt to transform the entire industry from Augusta, the ultimate strategy of hope, regardless of "time and diligence."
Rewarding failure by paying for operational inefficiencies and preventable clinical errors is the root cause of the organized chaos we call a health care delivery system. This reimbursement methodology contradicts the volumes of scripted quality and costs regulations and penalties the government hopes will control and instill fear in providers to avoid inefficiencies and preventable errors. Paying for failure is why growth in health care costs outpaces inflation. What incentive does a provider have to focus on eliminating inefficiencies and preventable clinical errors when they pay? Government's commitment to these contradictory tactics has made providers as much the victim as they are the culprit.
It is like watching the dysfunctional families on the TV shows Nanny 911 and SuperNanny. The parents (government) believe they are good parents and are doing all the right things but the kids (providers) just don't respond with the appropriate behavior. After some trail and error, a heart to heart with the Nanny and some tears, the parents become committed to new strategies. The parents transform first, and then the children improve their behavior. It is the same for health care. Government, insurers and the governor's office will have to transform its reimbursement methodology and attitude towards providers before providers will have an incentive to change behavior.
The National Committee for Quality Assurance labeled the current systems of reimbursement as "neutral on the issues of bad quality, which actually - often inadvertently - pays more for it." The Juran Institute Inc. has projected that rewarding failure, which could have been prevented, represents 30 percent of the nation's total health care costs. In 2003, that represented $1,389 per Mainer or more than $12,000 per uninsured Mainer!
What are 21 st century win/win strategies a health care Nanny might suggest?
- Stop paying for failure. Create a reimbursement methodology that gives providers the incentive to be in the constant pursuit of excellence and the financial means to avoid failure.
- Stop the need to cross-subsidize where one underpaid service needs a financial lifeline from an overpaid service.
- Stop Medicare and Medicaid from recouping payments for failure with 15 percent and 30 percent discounts respectively, which are added on top of the cost of failure the rest of us pay.
- Stop refusing physicians and hospitals certificates of need if they can demonstrate new heights in quality at lower costs. And the list of "stops" and "create" is endless if we have the courage to think outside the box.
Sounds scary because conventional thinking views the world of health care as flat; and without regulatory barriers of fear and control, providers would fall. But the opposite is true. We see it every day in every industry except health care, government and education, the only three industries controlled by government and universally rewarded for failure.
If we created a reimbursement methodology that instills accountability, freedom and the financial resources to explore new frontiers in quality outcomes and costs, then the health care industry, not government, will create an organizational culture that will support affordable universal health care. Until the Governor's Office of Health Policy and Finance develops 21st century strategies that effectively will challenge the status quo, Dirigo Health and DirgoChoice will remain just two "dead programs spending."
R. Daniel King of Topsham was the president/chairman of MEDQIC Inc., a large medical group in St. Louis, Mo. He periodically was contracted to do crisis management for health care institutions with very serious patient care problems and/or financial issues. He says that during this period he learned that inspired employees can make extraordinary transformations in patient care when they know leadership cares through words and actions.
Dirigo Health: 'dead program spending'
04/22/2005 By R Daniel King, Times Record Contributor
Dirigo Health is sadly a "dead program spending." The executive director of the Governor's Office of Health Policy and Finance recently reminded us that the "Legislature enacted Dirigo Health to reduce our health care costs, improve quality and increase access to coverage." Yet none of the strategies the office has chosen has any remarkable history achieving these goals.
The office does not acknowledge it rewards failure in quality and efficiency, so quality and cost will continue to deteriorate. DirigoChoice enrollment increases are offset by mandated decreases in MaineCare enrollment, adding to bad debt and charity. The office failed to inspire the hospital industry with old control and fear tactics and now will attempt to transform the entire industry from Augusta, the ultimate strategy of hope, regardless of "time and diligence."
Rewarding failure by paying for operational inefficiencies and preventable clinical errors is the root cause of the organized chaos we call a health care delivery system. This reimbursement methodology contradicts the volumes of scripted quality and costs regulations and penalties the government hopes will control and instill fear in providers to avoid inefficiencies and preventable errors. Paying for failure is why growth in health care costs outpaces inflation. What incentive does a provider have to focus on eliminating inefficiencies and preventable clinical errors when they pay? Government's commitment to these contradictory tactics has made providers as much the victim as they are the culprit.
It is like watching the dysfunctional families on the TV shows Nanny 911 and SuperNanny. The parents (government) believe they are good parents and are doing all the right things but the kids (providers) just don't respond with the appropriate behavior. After some trail and error, a heart to heart with the Nanny and some tears, the parents become committed to new strategies. The parents transform first, and then the children improve their behavior. It is the same for health care. Government, insurers and the governor's office will have to transform its reimbursement methodology and attitude towards providers before providers will have an incentive to change behavior.
The National Committee for Quality Assurance labeled the current systems of reimbursement as "neutral on the issues of bad quality, which actually - often inadvertently - pays more for it." The Juran Institute Inc. has projected that rewarding failure, which could have been prevented, represents 30 percent of the nation's total health care costs. In 2003, that represented $1,389 per Mainer or more than $12,000 per uninsured Mainer!
What are 21 st century win/win strategies a health care Nanny might suggest?
- Stop paying for failure. Create a reimbursement methodology that gives providers the incentive to be in the constant pursuit of excellence and the financial means to avoid failure.
- Stop the need to cross-subsidize where one underpaid service needs a financial lifeline from an overpaid service.
- Stop Medicare and Medicaid from recouping payments for failure with 15 percent and 30 percent discounts respectively, which are added on top of the cost of failure the rest of us pay.
- Stop refusing physicians and hospitals certificates of need if they can demonstrate new heights in quality at lower costs. And the list of "stops" and "create" is endless if we have the courage to think outside the box.
Sounds scary because conventional thinking views the world of health care as flat; and without regulatory barriers of fear and control, providers would fall. But the opposite is true. We see it every day in every industry except health care, government and education, the only three industries controlled by government and universally rewarded for failure.
If we created a reimbursement methodology that instills accountability, freedom and the financial resources to explore new frontiers in quality outcomes and costs, then the health care industry, not government, will create an organizational culture that will support affordable universal health care. Until the Governor's Office of Health Policy and Finance develops 21st century strategies that effectively will challenge the status quo, Dirigo Health and DirgoChoice will remain just two "dead programs spending."
R. Daniel King of Topsham was the president/chairman of MEDQIC Inc., a large medical group in St. Louis, Mo. He periodically was contracted to do crisis management for health care institutions with very serious patient care problems and/or financial issues. He says that during this period he learned that inspired employees can make extraordinary transformations in patient care when they know leadership cares through words and actions.
Thursday, May 7, 2009
Pursuing Excellence In Efficiencies Trumps Medicare-Purchasing Power
Universal access to affordable care starts with operational efficiencies the rails quality travels to achieve excellence in patient and financial outcomes. Without operational efficiencies, quality outcomes are a crap shoot which is why the US has the best and worst health care.
The constant pursuit of efficiencies forces leadership to be engaged in patient care and financial processes and the rewards are what they value: money. Only a few find value in patient outcomes, otherwise the industry would not be quality challenged. The cultural impact of inspiring excellence in efficiencies transfers to patient outcomes like a contagious disease. This is why this blog advocates paying for excellence and not failure which gives providers the financial resources to pursue efficiencies which will have a direct impact in lowering preventable medical errors IMMEDIATELY.
You can not achieve excellence in efficiencies without leadership inspiring employees and supporting each with continuous education, effective communication, and the most current information timely delivered so each can effectively focus on the needs of the patient in an environment driven by accountability and innovation. Two that approach this strategy are Intermountain Healthcare and Mayo Clinic.
Research by Dartmouth Medical School suggested that if all Americans accessed care from Intermountain and Mayo, the nation’s $2.7 trillion health care bill would be cut 33 and 25 percent with NO rationing while saving $890 billion and $675 billion respectively. It only takes $215 billion in savings to pay for an individual private insurance policy for every uninsured American leaving billions in savings and an unbelievable boost to US businesses.
Presently, Medicare and Medicaid utilize purchasing power to underpay excellence which hospitals and physicians recoup through inflated charges paid by private insurers. These subsidies according to two studies inflate premiums 11 to 13 percent, maybe more, giving the perception Medicare efficient; private insurers inefficient. It is this myth that makes many Americans think a Medicare-like program for the masses is a solution. But, Mayo’s chief executive has stated that a universal Medicare-like program would eliminate these subsidies and, “your very best providers will go out of business.” Health care reform should be focused on increasing “best providers,” not exterminating them.
It is interesting how government advocates that health care professionals learn from best practices, but government does not seem inclined to learn how “best providers” achieve quality outcomes at 25-33 percent savings and no rationing. It is this kind of inconsistency that consistently defines the Obama Administration's attempt to nationalize industries that government manipulation has perverted: health care, education and mortgage banking.
The constant pursuit of efficiencies forces leadership to be engaged in patient care and financial processes and the rewards are what they value: money. Only a few find value in patient outcomes, otherwise the industry would not be quality challenged. The cultural impact of inspiring excellence in efficiencies transfers to patient outcomes like a contagious disease. This is why this blog advocates paying for excellence and not failure which gives providers the financial resources to pursue efficiencies which will have a direct impact in lowering preventable medical errors IMMEDIATELY.
You can not achieve excellence in efficiencies without leadership inspiring employees and supporting each with continuous education, effective communication, and the most current information timely delivered so each can effectively focus on the needs of the patient in an environment driven by accountability and innovation. Two that approach this strategy are Intermountain Healthcare and Mayo Clinic.
Research by Dartmouth Medical School suggested that if all Americans accessed care from Intermountain and Mayo, the nation’s $2.7 trillion health care bill would be cut 33 and 25 percent with NO rationing while saving $890 billion and $675 billion respectively. It only takes $215 billion in savings to pay for an individual private insurance policy for every uninsured American leaving billions in savings and an unbelievable boost to US businesses.
Presently, Medicare and Medicaid utilize purchasing power to underpay excellence which hospitals and physicians recoup through inflated charges paid by private insurers. These subsidies according to two studies inflate premiums 11 to 13 percent, maybe more, giving the perception Medicare efficient; private insurers inefficient. It is this myth that makes many Americans think a Medicare-like program for the masses is a solution. But, Mayo’s chief executive has stated that a universal Medicare-like program would eliminate these subsidies and, “your very best providers will go out of business.” Health care reform should be focused on increasing “best providers,” not exterminating them.
It is interesting how government advocates that health care professionals learn from best practices, but government does not seem inclined to learn how “best providers” achieve quality outcomes at 25-33 percent savings and no rationing. It is this kind of inconsistency that consistently defines the Obama Administration's attempt to nationalize industries that government manipulation has perverted: health care, education and mortgage banking.
Wednesday, May 6, 2009
President Obama Moving US Towards YugoCare
In April, lawmakers and experts focused on sweeping changes to Medicare declaring it should become the “test lab for making the entire health care system less wasteful.” Sen. Max Baucus, D-Mont, the Finance Committee chairmen heading this share your feelings meeting declared, “Medicare is going to be the driver to achieve quality reforms.” Health care is wasteful and quality challenged because of Medicare purchasing power and win/lose strategies. Sen. Bauscus's committee is delusional if it thinks larger injections of the virus, Medicare, is the cure. As this blog has argued previously, if Medicare rewards operation inefficiencies and preventable medical errors, then expect growth in wastefulness and deterioration in quality.
Historically, Medicare focuses on price controls and shifting costs to private insurers at the sacrifice of patient outcomes. Remember the 1999 Institute of Medicine report that declared the nation’s hospitals kill 98,000 patients annually due to preventable errors. The same data reviewed by HealthGrades upped the estimate to 200,000 preventable deaths. It took ten years and two million preventable deaths before Medicare on October 1, 2008 took action against preventable medical errors. That is if you call Medicare’s policy to not pay for one hundredth of one percent of the cost of preventable medical errors action.
When Congress talks of wasteful spending, it does not mean operational inefficiencies. It means paying less for more which is exactly what the proposed (FY) 2010 Inpatient Prospective Payment System (IPPS) plans to do for hospitals. IPPS gives advocates of a government single payer system an insight to how Medicare gives an increase of 2.1% to hospitals then takes 1.9% back through a phased-in documentation and coding adjustment (DCA) with no regard whether revenue cuts will impact patient outcomes.
It is my anticipation that this anti-free market Congress thinks that more price controls inflicted on all health care suppliers and physicians who happen to be in politically incorrect specialties or products will be the strategy for eliminating “waste.” This strategy brought the world the Yugo automobile which was a socialistic government's attempt to set prices so Yugoslavia could achieve universal automobile ownership. Sound familiar. The Yugo’s use of price controls failed because it was cheap to buy but unaffordable to maintain. Meanwhile, Toyota was pursuing a strategy to inspire employees to be in the constant pursuit of excellence giving it world dominance in affordable, reliable automobiles. Inspired humans will always trump command/control governments.
The disdain the Obama administration has for free markets drives it to pursue the Yugo strategy of price control pain moving the US health care system to YugoCare. This will result in great costs and human suffering. It will take extraordinary failure before the country will adopt the cheaper, quicker, self-sustaining strategy of paying for excellence and never failure in a manner that inspires health care professionals to be in the constant pursuit of excellence. Remember, Adam Smith's free market concept grew from government controlled economies that caused massive famine.
Historically, Medicare focuses on price controls and shifting costs to private insurers at the sacrifice of patient outcomes. Remember the 1999 Institute of Medicine report that declared the nation’s hospitals kill 98,000 patients annually due to preventable errors. The same data reviewed by HealthGrades upped the estimate to 200,000 preventable deaths. It took ten years and two million preventable deaths before Medicare on October 1, 2008 took action against preventable medical errors. That is if you call Medicare’s policy to not pay for one hundredth of one percent of the cost of preventable medical errors action.
When Congress talks of wasteful spending, it does not mean operational inefficiencies. It means paying less for more which is exactly what the proposed (FY) 2010 Inpatient Prospective Payment System (IPPS) plans to do for hospitals. IPPS gives advocates of a government single payer system an insight to how Medicare gives an increase of 2.1% to hospitals then takes 1.9% back through a phased-in documentation and coding adjustment (DCA) with no regard whether revenue cuts will impact patient outcomes.
It is my anticipation that this anti-free market Congress thinks that more price controls inflicted on all health care suppliers and physicians who happen to be in politically incorrect specialties or products will be the strategy for eliminating “waste.” This strategy brought the world the Yugo automobile which was a socialistic government's attempt to set prices so Yugoslavia could achieve universal automobile ownership. Sound familiar. The Yugo’s use of price controls failed because it was cheap to buy but unaffordable to maintain. Meanwhile, Toyota was pursuing a strategy to inspire employees to be in the constant pursuit of excellence giving it world dominance in affordable, reliable automobiles. Inspired humans will always trump command/control governments.
The disdain the Obama administration has for free markets drives it to pursue the Yugo strategy of price control pain moving the US health care system to YugoCare. This will result in great costs and human suffering. It will take extraordinary failure before the country will adopt the cheaper, quicker, self-sustaining strategy of paying for excellence and never failure in a manner that inspires health care professionals to be in the constant pursuit of excellence. Remember, Adam Smith's free market concept grew from government controlled economies that caused massive famine.
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