Thursday’s Healthpopuli post caught my eye – Hospitals’ fiscal health is eroding. More than 50% of hospitals had a negative margin in Q4 2008. Sounds like the hospitals need wellness and disease management programs to address their ailing health just like patients are getting.

The main reason cited in Healthpopuli for the poor fiscal health is that admissions are down. Another oft-cited factor is the proliferation of HDHP (High Deductible Health Plans) where consumers are left with the first $1500, $2000 or even as much as $5000 of their healthcare expenses within a given year. 

It’s easy to place the blame on fewer people coming through the doors, but who knows, maybe we’re getting healthier or just using better judgement about what constitutes a needed procedure. Maybe our wellness and DM programs are working. Insurance companies and self-insured employers should be jumping for joy at the news because that SHOULD translate to lower healthcare expenses for them in the form of fewer claims – at least in the short term. Hospital should be taking a collective sigh of relief that they can finally slow down on adding yet another massive capital building project to meet the ever-increasing demand. That might save them some of their cash and get them closer to being profitable again.

It’s easy to place the blame on consumers not paying their bills, but perhaps it’s an opportunity for hospitals to take a good hard look at their processes and procedures and address ineffiencies. In reporting a negative earnings period, one hospital identified five reasons they were unprofitable, and there is no small amount of irony in the fact that they attributed $200K of their $1.6M shortfall to overruns in their self-insured health plan for the hospital as an employer.

With the average deductible rate topping $1000 for the first time in history and 20% of employers saying they are considering dropping their healthcare plan, it looks as if simply raising the rates at the hospital is not going to be a solution. Demand is already down. Payment is already off. Raising rates will only further stifle demand and higher rates will only result in increased non-payment. Blood will not flow from a stone no matter how deep you cut it.

Just as a physician must not allow themselves to treat the symptom, but instead identify the disease, hospitals find themselves in the same position. The health system as a whole is diseased – from patient, to insurer, to provider to government. As patients, we are being forced to take more responsibility through increased share of the burden of the costs, wellness and disease managemet programs. Insurers have work to do as well (that’s another post). Governement is studying where they need to go. Hospitals need to begin to look at what they can do in terms of equivalent wellness and disease management programs for their facilities. They need to trim the fat. They need to be more efficient. They need to proactively seek out better long-term solutions instead of resorting to quick fixes as the insurance company all too often forces them to do.

The poor fiscal health of hospitals is not the cause, it is the symptom. Time to get the diagnosis right, start treating the disease and not fixate on the symptoms.

And no sooner than I hit the publish button on this post, Jen McCabe Gorman tweets EXACTLY what I’m talking here on Henry Ford Clinic.

Just saw the CNN report on 13 million uninsured 20-somethings in this country. New to the job force and turning down their health insurance.

What are they thinking?!?! Do they believe that they can just go out and buy what they need in terms of medical goods and services on the free market? Good grief! This is America for goodness sakes.

So what are they doing in lieu of buying insurance?

Radical things like minding their health– watching what they eat, working out, bundling up before they go out in the cold, washing their hands (oh, these kids – they’re like modern day hippies shunning the norms of society).

They go to the doctor only when absolutely necessary instead of for every little ache and pain. They go to retail clinics (like Minute Clinic and The Little Clinic) where they know the costs BEFORE they buy (oh my, what are these kids coming to wanting to know the price before they blindly incur the expense). They look things up on the internet (It may be MY chronic disease but shouldn’t the doctor know more about it than me? He treats it, and I only live with it…every single day of my life).

But why should these 13 million have insurance? In case something happens.

Hellooooo – they’re 20-somethings and invincible.

But seriously, why should they? Because it underwrites the rates of the older portion of the population. If they don’t get healthcare, they don’t offset the risk pool – they don’t underwrite the older segment of the population. And we know what that means – our rates will go up because they aren’t contributing monetarily (and taking less out than they put in) as we expect them to do.

But we can still get them. In New Jersey, children can stay on their parents insurance to age 30! Thirty!!!! In many other states it’s only 24 or so.

So now I’ll set aside the sarcasm.

What we are seeing is the revolution. The new generation is taking a stand. We have a product – health insurance – AND THEY ARE NOT BUYING! The business world should get the message here. These folks are going to opt for surgery overseas, retail clinics and internet consults. They are going to cost shop prescriptions and doctors. They are going to demand affordable access to care and they are going to want to know the price AHEAD of time. And they are going to return health insurance to truly being insurance – a safety net for catastrophic situations instead of the all you can eat buffet for $20 we have bad for soooo long – too long.

Do NOT think that it is the sage old regime of healthcare executives and politicos in D.C. who are going to change healthcare. It is the 20-somethings. They alone are able to break out of the old ways of thinking. It has been that way generation after generation. THEY have the new ideas. THEY are taking a more rational approach. They are getting organized and THEY are not content to go along with the system as it has been.

Yes, they are 13 million without health insurance…and growing. THEY will change healthcare.

Congratulations

Congratulations on your continued progress in gaining commitments from insurance companies to step away from the Ingenix Prevailing Healthcare Charges System (the database most health insurers use to determine “usual and customary rates” for out-of-network reimbursement rates). Most individuals inside and outside of the industry recognize the potential conflict of interest as well as the likelihood that what Ingenix defined as “reasonable” was probably less than reasonable by a significant margin.

And Then I Read…

My understanding of your settlement with each insurance Carrier (such as Wellpoint and Aetna) is based on the following excerpt::

…WellPoint will end use of the [Ingenix] database [to determine out-of-network reimbursements] and pay $10 million to help finance the development of a new independent database administered by a not-for-profit group. Cuomo, who reached similar agreements with five other health insurers earlier this year, said that his office hopes to have the new database operational in six months and estimated that the effort will cost about $100 million (Bray, Wall Street Journal, 2/19).

Without question, I applaud your efforts and commitment to create a not-for-profit entity that ensures objective, transparent and reasonable out-of-network insurance pricing. Spot on, sir. But an estimated cost of $100 million?! Good grief, I was caused to pause and try digest such a staggering expense for an informational tool that shouldn’t, nay, couldn’t cost that much.

A Drop In The Bucket

I then came across a New York Times article (2/18/09) entitled “For Uninsured Young Adults, Do-It-Yourself Health Care.  I contemplated the plight of New Yorkers but also people across the nation and noted that Gov. Paterson of New York proposed allowing parents to claim young adults as dependents for insurance purposes up to age 29. Unfortunately, this approach merely supports what I consider “a drop in the bucket“, as the article pointed out…

If Governor Paterson’s proposal is approved, an estimated 80,000 of the 775,000 uninsured young adults across New York State would be covered under their parents’ insurance plans. That would leave hundreds of thousands to continue relying on a scattershot network of improvised and often haphazard health care remedies.

And then the final straw smacked me in the face via yesterday’s (2/24/09) Washington (Associated Press) causing me to draw a deep breath while reading:

A new government report on medical costs paints a stark picture for President Barack Obama, who is expected to call for a health care overhaul in a speech Tuesday night to a joint session of Congress.

Even before lawmakers start debating how care is delivered to the American people, the report shows the economy is making the job of reform harder.

Health care costs will top $8,000 per person this year, consuming an ever-bigger slice of a shrinking economic pie, says the report by the Department of Health and Human Services, due out Tuesday.

As the recession cuts into tax receipts, Medicare’s giant hospital trust fund is running out of cash more rapidly, and could become insolvent as early as 2016, the report said. That’s three years sooner than previously forecast.

Based on current events and the state of our economy … The Offer

I would like to offer the LIVE and fully accessible healthcare consumerism change:healthcare platform, which currently is processing claims from multiple clients as a vastly less expensive, already HIPAA compliant and available TODAY for data connection to the carriers.

In fact, I would also be so bold as to say that we would offer our platform and Carrier integration for $3 million a year OR our annual operating/staff support cost (whichever is less) and we would immediately engage whichever University or not-for-profit entity you prefer for database auditing and oversight purposes.

I am offering you and the carriers an immediately available, already proven and secure platform that is currently used by employers and their employees to save money (30%) on their healthcare expenses and make informed decisions.  I’d rather you and the Carriers leverage our platform at “cost” than to unnecessarily spend $100 million to build something that already exists.  We would be doing this for the public good, but that’s in line with our company values and founding principles!

Why do we care?

I have been holding back on this proposition for several months, but my blood was brought to a “I’ve got to do something now” boiling point due to the February 19th USA Today article by Julie Appleby regarding double-digit premium increases on the individual insurance market (est. at 17 million people):

At a time when more people are forced to buy their own health insurance because of job losses, costs for many individual policies are soaring…

Among this year’s large rate increases on the individual market:

• Anthem Blue Cross in California has notified about 80% of its 800,000 individual policyholders of double-digit increases, many above 30%. Spokesman Ben Singer says rising medical costs are prompting the increases.
• Blue Cross of Michigan is seeking state approval for a 56% increase in individual premiums. Spokesman Andy Hetzel says the company needs to offset losses stemming from state rules making it the sole insurer required to take all applicants.
• Regence Blue Cross Blue Shield of Oregon will raise rates for approximately 10,000 Washington state customers by 27.1% on March 1.

Another Washington insurer, LifeWise, raised rates 17.6% on Jan. 1, according to the Office of the Insurance Commissioner in Washington state…Some insurers say increases this year for individual policies aren’t out of the ordinary. Aetna, for example, says individual policy increases nationwide range from 8% to 22%.

…The average deductible, the amount paid before coverage begins, was nearly $2,000. Family coverage ranged from $219 to $494 a month with an average $2,600 deductible.

Insurers face shrinking enrollment in group plans because employers are shedding jobs. They also have deflated investment portfolios and higher costs as patients use more health services, says a report out last week from ratings agency A.M. Best. Those problems could lead to “higher rate increases than in the past,” says Sally Rosen, a managing senior financial analyst at Best.

Now it would be foolish of me to urge insurers to restrain premium increases. They are merely operating as businesses as any stock shareholder would expect (though I find a great deal of irony regarding these potential increases that will fall on the heels of the government’s COBRA subsidy plan for the recently unemployed). Yet, due to these decisions, there will be an immense welling of pressure on individuals to pay more for their premiums, swallow higher deductibles, and therefore urgently need help to understand and know where EVERY dollar is being spent and what their choices are.

As the tidal-wave of healthcare cost and utilization drowns individuals bearing the full weight of those costs, a dire need is raising it’s ugly head: The need for access to easily understandable negotiated prices for providers and the services they offer, allowing consumers to make informed decisions as well as save money that most of these people do not have. It’s rather simple, we need to enable a more transparent market for purchasing healthcare services. It’s not THE silver bullet, but rather one of many support mechanism that needs to be put into place.

Not a Perfect Solution, but it’s a start…

So there you have it. The wheels have begun rolling forward and what I am offering may seem trivial or naive but at least let us do something that would help you provide people with an easy to use tool at a fraction of the cost… in fact, at OUR cost.  I am offering our platform to support healthcare transparency combined with your choice of University or not-for-profit entity to ensure that out-of-network pricing remains independent and avoids (in your words) “manipulation”… all for $97 million dollars less than you anticipated. And yes, I really do stand behind this offer. Please feel free to contact me or my team to coordinate further discussions about our platform.

Sincerely,

christopher parks

CEO | co-founder
change:healthcare, Inc.

I have learned not to put complete blind faith in my Insurer. I do NOT blindly pay outstanding balances from providers and assume that my Insurer processed the claim properly, and neither should you as this story will show. Even though I’m a pretty savvy healthcare consumer (this IS what I do for a living – understanding the healthcare industry), this one had me confused for while.

My wife took my kids to a Clinic for their flu shots (No, I didn’t go and get mine, and that makes me far less of a person than those of you who did). Flu shots fall under “well care” on our plan, so there is no charge.

But then I got a bill from the clinic, an in-store deal – very convenient (I know, I should have gone too, stop already). The bill must be a glitch I told myself. I decided to wait and see if they figured it out rather than spend time on the phone with them and with my insurer. Then I got a statement for the bill again. Odd, I thought.

And then, I got a nice letter from Insurer asking me to confirm if I had another insurance plan. I procrastinated, was moving residences, etc. and did not answer that letter. I did not make the connection.

Doing something else entirely, I logged in to the online view of my insurance account (which I must say is a weak “silo” view of the information my insurer has). They only had two claims for the past year. That was wrong, I knew. Hmmm. Must’ve logged into the account for our previous policy (still active 2 years after moving off of that plan – can you say “we never update”). Yup. Logged out and logged in with the other username/password combo and suddenly, there are my claims for the year on my current plan.

Only then does it dawn on me. The clinic submitted the claim on the old insurance and did not confirm new insurance, or if they did, they simply accepted that my insurance info was current with them. My previous plan and this plan were with the same Insurer, so it’s an honest mistake.

So now my Insurer has denied the claim on my old insurance plan. The clinic wants their money because the Insurer denied it. Now I’ve got to go and straighten out both of them because my insurer who had BOTH policies is not able to do a simple lookup on my SSN and determine yes, I do have another policy AND LO AND BEHOLD IT’S WITH THEM!! Who’d a thunk since they only have 65% of the entire health insurance business in the state.

It’s only $60 bucks – 2 flu shots at $30 each, but it’s my $60. It’s money they planned on spending in the plan, so it’s paid in. Most folks would have simply assumed that the shots weren’t actually covered and paid the $60.

Thankfully, I called the Clinic’s 1-866 number, and Mona was very helpful and walked through things with me and resubmitted the claims.

Don’t put too much faith in your Insurer.

On January 9th, the Wall Street Journal published an interesting and especially note worthy article titled ‘Alternative’ Medicine Is Mainstream. The article summarizes and outlines simple evidence that diet and exercise are the best “cure” for our most common ailments.

‘Alternative’ medicine, as the authors of this article title it, is what most of us commonly think of as ‘Preventative’ medicine. The way in which we live our daily lives that will help to stave off America’s most common chronic conditions, such as obesity, heart disease, hypertension… I believe, though many of us choose to reject this line of thinking or simply just ignore it, that most of us know this to be true.

The most compelling aspect of the article comes quite a ways into the piece. Studies have shown that America spent more than $100 BILLION in 2006 on coronary bypass and coronary angioplasty procedures. The article continues, “Despite these costs, a randomized controlled trial published in April 2007 in The New England Journal of Medicine found that angioplasties and stents do not prolong life or even prevent heart attacks in stable patients (i.e., 95% of those who receive them).”  They have only been shown to prolong life in less than 3% of the cases. Further to this point, a study followed 30,000 men and women on six continents and found that lifestyle changes could prevent at least 90% of all heart disease.

So what’s the point you ask?  Well the point is that our healthcare system is set up to service and receive payment for disease treatment.  Sickness treatment – that’s it!!  Our government and private insurance companies are currently paying billions of dollars for procedures that are clinically proven to not extend life.  Why have we not begun incentivizing people to be healthy and the system for keeping them healthy?  Why have we not started spending insurance premiums on health and wellness, and as the article mentioned, finding out what “wellness” or “alternative medicine” works best for each individual?

Lifestyle changes are difficult.  I know!! I hit the snooze button this morning instead of getting up and going on the run I planned. I myself am guilty on not making 100% effort. If it were easy, everyone would be fit right?

But this is not the take away.  No more excuses – that’s the take away.  It’s time we start getting healthy.  It’s time to put down all those pills and pick up a gym membership.  The odds are that the gym membership costs less.  Heck, if you are taking a bunch of brand name drugs, you could probably even get a personal trainer, or a life coach, for that price. It’s time we start trying to change the healthcare system and the most tangible way for everyone to contribute is to make a little effort… let’s start getting healthy!

In an article posted by the Wall Street Journal on January 5th – IBM Chief: IT Investment Will Create Jobs -  IBM CEO Samuel Palmisano presented a report to the Obama transition team stating that a $30 billion  investment in computerizing health-care records, expanding broadband access, and improving the electrical grid could create more than 900,000 U.S. jobs. Considering we spent $2.2 trillion on healthcare in 2007, $30 billion almost seems like small change.

So what are the issues here??

Well first and foremost, IT investments are usually intended to reduce the number of employees and increase internal efficiency.  Will those jobs be short-lived once the IT practices become routine?

Second, the article states that there are very little metrics available (basically none) that site how IT  investments affect job creation. So the report is potentially more speculative than factual?

The good news: the breakdown of the government investment highlights that $10 billion invested specifically in electronic health records could create 212,000 jobs. Not bad.

Dr. Stanley Feld, “Top Health Blogger” by Wellsphere, claims that the healthcare reform agenda has already been set by Obama and Daschle.  You can read his post here.  He has some good points regarding reform and the need to involve physicians in the process.  However, his post struck a chord with me when he wrote about everyone believing that doctors are at fault, and that the government is out to change the way that doctors practice medicine.

I feel that most people agree that the quality of care in our system needs to improve.  Some might agree that reimbursement patterns must shift to reward high quality healthcare and wellness.  Few might agree that doctors are going to have to change the way they practice medicine, whether its integrating information technology and electronic medical records, or estabilishing stronger doctor patient relationships.  I would like to hear your opinions…

In the meantime, I wrote a response to Dr. Felds opinion piece.  It is available below:

“Dr. Feld,

I respect your opinion on the involvement of patients AND physicians in healthcare reform and policy. But without reading the by-line, about half way through your piece, I could tell you were an MD incapable of writing an unbiased piece on healthcare reform.

Problem: Unfortunately, not all doctors are out to service the best interests of their patients and some are most concerned with the thickness of their wallets. When I go to the doctor, why can’t he tell me about how much the services will cost?

Problem: We pay doctors only when patients are sick. You don’t make money if you keep me healthy, now do you?

Problem: The average patient does not understand medicine or the CONFUSING healthcare system.

The worst part of it all – is that I would argue that most MDs do not understand the system either. While I agree with you that “Socializing” healthcare is not the appropriate answer to our problem, I whole-heartedly disagree that the government is trying to “FORCE DOCTORS TO CHANGE THE WAY THEY PRACTICE MEDICINE.”

Let’s not equate “changing the way doctors practice medicine” with “changing incentives and reimbursement.” This is about keeping more people healthy and increasing the quality of care delivered. This is about rewarding physicians for delivering high quality care and keeping their patients healthy. This is about asking doctors to do their job efficiently and accurately. If to do this doctors have to change the way they “practice medicine,” then I might argue that they entered medicine for the wrong reason to begin with.
Transparency. Accountability. Competition. – Its time to make some changes in healthcare!”

In the news recently there have been a couple of articles citing some large companies moving their entire workforce to a high deductible health plan (HDHP), as a means of saving money and/or preserving health benefits. The New York Times article “Employers Offering Workers Fewer Health Plans” mentions Nissan – who is moving their entire 15,000 employee North American workforce to a HDHP – and Delta Airlines. If you take a look at the article, both Nissan and Delta Airlines provide their reasons for moving their workforces to HDHPs. Very interesting…

In addition to reasoning, the article also notes that the deductible for an individual will be at least $1,100 and much more than that for family coverage. Nissan’s will be $2,500 per family member, for which the company will deposit up to $1,600 in the family’s HSA.

AHHHHH $1,100 for an individual and $2,500 or more for a family!!!

High deductible health plans, aaccompanied by a health savings accounts (HSAs), are not something to be scared of.  Even though the deductible seems daunting at first, the coverage is typically 100% after the deductible is met.  Your employer should be funding part of the HSA and you can (read: should) contribute pre-tax dollars as well.

Things to think about when moving to a high deductible health plan:

1. If you do not think you will meet your deductible for the year, then you must begin to think about your healthcare differently. Healthcare costs vary between providers.  Pharmacies charge different prices.  Do your research!
2. The way your health expenses impact your pocketbook will certainly change from that of a traditional health plan. Your initial costs will be much higher, but you will still receive an “insurance discount” on care.
3. There are benefits to HDHPs such as preventative care, including immunizations for children, certain cancer screenings and well care for the whole family.

Remember, the most important thing you can do is read your policy. It should simply and specifically outline things that are covered at 100% even before your deductible is met.

And there are websites available, such as www.changehealthcare.com, that help you estimate your healthcare costs before seeing the doctor and even help you track you HSA spending.

I have argued the value of transparency in healthcare many times (note: scroll past Robert’s entries to view mine below)! But I have yet to argue the value of transparency in relation to other aspects of healthcare beyond just cost.

Shame on me!!

A recent article in BusinessWeek highlights Health 2.0 – the emergence of “patients as partners.”  Featured is PatientsLikeMe an online social network with communities specifically for patients with neurological, neuroendocrine, mood, and autoimmune conditions such as MS (multiple sclerosis), ALS (amyotrophic lateral sclerosis), and HIV/AIDS. The site provides comprehensive tools which allow patients to track and document everything from their symptoms and lifestyle, to current medications and other recommended treatment.

What is new and revolutionary about this site??  A lot!!  To members of “Health 2.0″ PatientsLikeMe is leading the way in engaging pateints as partners, “experts” of their care.  But to the media, the idea of patients openly discussing their health and leveraging this information to improve their own care is a “new idea.”

Business Week writes, “PatientsLikeMe and a proliferation of similar startups are building a new business predicated on the belief that the wisdom of crowds of patients will bring insights, solace, and most of all, power.

Power because, as it turns out, patients talking among themselves on a global scale with complete transparency produces all kinds of unexpected results. Drug side effects can be reported to regulators by the patients experiencing them, without waiting for the manufacturers to come forward. Pharmaceutical companies can use social networks to recruit subjects quickly for clinical trials, speeding up the pace of research. For that matter, patients can simply band together and run their own clinical trials, leaving drug companies and physicians out of the loop.”

So what is the value of transparency in relation to your healthcare and health conditions?  Wisdom of the crowds.

As it turns out, your health experiences can help someone else find out about a new drug, about the side affects of a drug they have just been prescribed, or possibly a stretching technique that relieves stress.  The possibilities are endless it seems when conceptualized on a global scale.  Our health systems may be set up differently, but the way in which an individual experiences a drug or symptoms of their condition may be beneficial to others across the globe, regardless of whether they have health insurance or not!

Three cheers to PatientsLikeMe for leading the way… And most importantly, thanks to its many members for being transparent, and recognizing the value!

For more information on patientslikeme amd ways in which they are revolutionizing healthcare visit their website at www.patientslikeme.com or watch their featured spot on CBS Evening News.

Went for the third of the four surgeries for varicose veins in my legs. Tweeted the whole procedure again (see below). And since this procedure was soooo much more graphic, I got the pix and video to go with it. To bring everyone up to speed, the first two surgeries were laser ablation from the front and back of the legs. That sealed off the problem veins. The last two are the actual removal of visible veins which have proven to be painful. The pain was the result of phlebitis. As Dr. Bonau removed the veins, he asked if I had ever had phlebitis. The veins showed signs of it and the pain that I have had would be consistent with that diagnosis.

Fair warning: the pix and vids are pretty graphic. Not for the squeamish. All pix and vids were shot by me personally while they did the work on my legs. The areas were deadened so I felt nothing, but it was still a bit unnerving to watch the doc tugging on my body like he was.

Thanks agin to all of you following along and thanks for the supportive messages before, during and after surgery. A special shout out to @MindofAndre twitter and blogger trailblazer.