Healthcare Reform needs a Llama Herder

I'm disappointed. Not disappointed like when you get rejected from a graduate program where you spent a solid 4 months completing their application and you promptly open a bottle of whiskey disappointed. More like the disappointment when I realized that my junior high wrestling coach was a terrible coach. He brought me into the sport and gave me the Most Improved Wrestler Award. However, in high school, I realized that all he did was yell to give someone a half nelson. When we gave attitude to other coaches, they would threaten to have him coach our matches.

I'm disappointed because I saw another health care reform post from physicians that says they want things to be like they were in the 1950's. It was from Sermo.com, a social media site that is for physicians with 11,000 contributors.

Before I get into the details of the post, I'm reminded of my encounter with a physician at a rural hospital. I had just started working in hospital administration, was touring the hospital, and a physician approached me. We did introductions and he asked me what I would do if physicians unionized and we had to make all kinds of changes. I responded that we would listen to every single demand and probably make every single change. However, that would never happen because physicians are too inependent and too split along specialties and practice setting to ever form a union. The physician admitted that I was right and it would be easier to herd llamas than physicians. Llamas are even harder to herd than cats since you can't pick them up and they get mad and bite if you annoy them too much.

There are inspiring physician leaders in health care reform, like Atul Gawande, Don Berwick and Mark McClellen who have put forth good initiatives that address the core issues of health care reform such as 10 steps to better health care in the NY Times that focuses on coordination, collaboration of care, and use of electronic medical records. However, other physician organizations have not followed their lead. As a result, I'm still disappointed.

Instead, the Sermo.com offered the Physician Appeal (my response is in bullet points below):

1. Reducing unnecessary tests and procedures through tort and malpractice reform.

I agree that malpractice is out of hand but there is no data that it is the principle and main driver of costs and quality in our health care system. Texas enacted strict torte reform 3 years ago and it didn't change the cost trend. Probably because 7,000 physicians have moved to Texas which has contributed to high medical costs.

This is a similar argument that most companies make to protect themselves from law suits. We could argue that unnecessary law suits are a bad thing that for the purpose of this discussions, physicians should have no more or no less liability protection than anyone else.

Again, the main question to ask is, has torte reform in 21 states, lowered medical costs? The answer is no, it has not. Malpractice insurance premiums have dropped but not medical costs. It is more noise than a serious driver as it probably accounts for less than 2% of the rise in health care costs.

2. Allowing doctors to spend more time taking care of patients by making billing more transparent and streamlined (creating an alternative to CPT codes).

I interpret this as doctors don't like 15 minutes visits, coding, and figuring out insurance claim forms. This billing information is used for a lot of research so it does have value. However, there are a few simple options already available that physicians have not completely embraced.

One option is capitation. A physician is given 85% of the heat insurance premium and uses that for the patients medical care. If the patient never gets sick, they keep it. This is an old HMO concept that physicians have previously rejected.

Another option is risk share. This is an easier form of capitation where the providers will get a share of the profits left over from the insurance premium. They could lose some money if they don't manage care but only to a point. For example, a doctor would be paid a base rate of $115 per unit. If they manage care really badly, it would go no lower than $100 per unit. If they manage care really well, it could be as much as $180 per units.

Some physicians will accept those options but most like to paid per unit because they control their income better by doing more units. However, the principle can be met in today's environment if the insurance company is fair with the payment arrangements. This doesn't have to be anything new.

3. Insurance reform to ensure that physicians are making medical decisions with their patients, not insurance company administrators.

Insurance administrators make decisions about what physicians will get paid to do or not paid to do but the ultimately medical decision is with the physician and the patient. Let's separate the payment from the actual medical decision.

When physicians make medical decisions that follows evidence-based guidelines, there is rarely a problem. Insurance companies use their claims data, national guidelines, and Medicare guidelines. When insurance companies behave badly and don't, they tend to get national press and that behavior is corrected.

Administrators get involved with physicians' medical decisions because there is a lot of unexplained variation in those decisions. Government and insurance administrators also have access this data that physicians do not have. One health plan noted that based on national research and data, expected C-section rates for all pregnancies was something like 35%. However, their claims data showed huge variations within the local practice. Payment became based on being slightly above the national rate and the rate of C-section for their contracted providers changed dramatically. So, it's not necessarily a bad thing when insurance administrators get involved in payment decisions.

4. Revising the methods used for calculating reimbursements so that there will be enough qualified physicians to provide patient care.

Generally, specialists get paid $250,000/year (as high as $500,000 for some), and primary care physicians get paid $150,000/year. Option include: 1) Every physician could get paid the same regardless of specialty or 2) lower specialists payment and increase primary care payment.

I interpret this as stop underpaying primary care which is true. However, if the increase in primary care isn't offset somewhere, we'll just have a more expensive system. Given what specialists get paid, there's plenty of money to be shifted.

In summary, I read these principles as leave us alone and pay us better. Now I agree that physicians face an almost unfair amount of scrutiny but this is not exactly a transformative vision of health care.

This is my second post railing physicians for regressive visions of health care. Although it may seem like I have some issue with physicians or some bitterness that I didn't go to medical school, some of my best friends are physicians! In fact, I went climbing with a physician today and not only did he not drop me but he agrees with my post.

Physicians are smart, well-trained, and can be good at using data to change their decisions. That's why it continues to disappoint me that they have not seized leadership of health care reform. Hospitals, health plans, and the pharmaceutical industry have all negotiated arrangements. However, physician groups and the American Medical Association continue to produce proposals to say leave us alone and maybe pay us a little better while you're at it.