The Medical Industrial Complex

Journalist and Health Care Advocate Maggie Mahar has a new book and documentary out titled "Money-Driven Medicine: The Real Reason Health Care Costs So Much" and the documentary is starting to shake up some of the current debate about Health Care in America.

Here's some excerpts from the movie, which was featured on Bill Moyer's PBS show last week. She spends some of the film talking with doctors and others in Nashville, which is home to a large number of medical corporate headquarters. Here's some excerpts from Mahar's documentary:

"Maggie Mahar: One time Dr. Donald Berwick called a hospital in Texas and said, "We've heard you have a very good procedure for treating a particular disease. We'd like to learn more about your protocol so other hospitals can use it." And the hospital said, "We can't tell you that. It's a competitive advantage in our market that we're better at treating this disease and it is very lucrative. So this is proprietary information."

Dr. Donald Berwick: We believe in markets, right? Isn't that the American way? Well, markets mean competition. Isn't that the American way? Competition makes things come out right. Well, what does that mean in health care? More hospitals so they compete with each other. More doctors compete with each other. More pharmaceutical companies. We set up war. Wait a minute, let's talk about the patient. The patient doesn't need a war.

Maggie Mahar: The patient isn't the center of a collaboration. The patient is the victim of a competition. There's a saying in Swahili, "When…" I can't remember this one… "When the elephants fight the grass is trampled." The patient is essentially the grass.

Dr. Clifton Meador: Somebody says, "Nobody in Nashville makes anything. We just do stuff and people send us money." I've been told they never had a recession in the history of the place. This is music row. Every one of these houses is now a recording studio. There's Love Monkey Music, Flashville, Sharp Objects Music, Seasac, whatever that is. This is the heart of "music city" USA.

Here's what a nurse told me. "Tell patients to remove the foil from a suppository before insertion."

Maggie Mahar: Clifton Meador has had many careers. He's been an author, a family doctor, an epidemiologist, a health care administrator and the youngest ever Dean of the University of Alabama Medical School. Over the years, he's watched the business of health care turn into a driving force in the US economy. Much of it headquartered in Nashville.

Dr. Clifton Meador: This is Marilyn Way. Marilyn Way is a center road of Marilyn Farms. Marilyn Farms is a huge complex. The predominant business in here is health care corporations of one sort or another. This goes on and on for over a mile here and this is not called for-profit hospital row, or anything like that, but this, this is the equivalent of the music row that we went down for the recording industry.

Dr. Clifton Meador: This is titled "The Nashville Health Care Industry, The Family Tree 2006." Every little square here is a health care business industry or spin-off. We have 3 mother corporations here: HCA, which is the Hospital Corporation of America, spun off all of these. Hospital Affiliates, which is a spin-off of HCA, spun off all of these. And Health Trust, which is a spin of Hospital Affiliates and HCA, spun off all of these. So this is a massive, industrial health complex that's headquartered here in Nashville.

Maggie Mahar: After World War II, while other countries let their government begin to intervene in health care to make sure everyone got care, to regulate it to make sure it was good care, in this country doctors very, very strongly opposed any government involvement or anyone being involved in telling a doctor what to do. After Medicare was passed in 1965, elderly patients were getting far more care than they had been before then.

Then that's when our industrial medical complex, I would say, took off. By the early 70s, there were so much money involved that suddenly people began to say, "You know what? Medicine is too important to be managed by doctors. We all know doctors are bad managers. What we need are businessmen managing health care." And that's when health care went from being physician centered and controlled, to a large degree, by doctors to being controlled by the corporation and the CEOs of those corporations.

And, over time, more and more the CEO of the Hospital would not even be somebody with a MD. He would be somebody with a MBA. And CEOs bent on growth, bent on higher quarterly earnings, quarter after quarter, and year after year, are always pushing for more sales, more revenues, more and more and more. It produces more. But more may not be better for our health."

You can see and read more about "Money-Driven Health Care" here.

And while there is an intense and rising anger among some about the evils of a government medical program like Medicare, surveys show patients are actually happy with the program (via Health Beat):

"Medicare is the second largest health care payer in America, trailing only Medicaid. The program is very popular with its enrollees, with polls showing a higher level of satisfaction than with private insurance.

Medicare is less popular with hospitals.

Opponents of health care reform in general and of a strong public option in particular often cite hospital dissatisfaction with Medicare as a reason why the reform programs won’t work. They report that evidence suggests that overall Medicare pays hospitals less than what it costs them to provide care. Private insurers pay more, and by “cost-shifting,” hospitals use these payments to make up the losses on Medicare. Opponents worry that if a public option linked to or modeled on Medicare becomes the dominant payer for people under 65, hospitals will go broke without the “subsidy” from private insurers, and the health system will be destroyed. Data collected by hospital groups and the insurance industry suggests that this is unlikely to happen.

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First, according to the American Hospital Association itself, 42% of hospitals make a profit on Medicare overall.

In the remaining hospitals, most Medicare patients are profitable. Losses on Medicare patients are related to a minority of patients who need much more care than average because of longer stays, more complications, and underlying health problems. Since the profits on most Medicare patients are small, large losses on this small number of outliers can drive overall payments below costs.In looking at any data on payments, it is very important to distinguish between Medicare and Medicaid. Payments by Medicaid – the government plan for the poor—are significantly lower. On average, Medicaid pays 72% of what Medicare pays for the same service. Those who oppose any government plan often lump Medicaid and Medicare reimbursements together to argue that Medicare grossly underpays providers. There is no question that Medicaid needs significant revision. Medicaid reimbursements should be hiked; payments to states should cover states’ costs. The House health care bill takes a step in that direction by mandating that Medicaid reimbursement for primary care must be raised to equal Medicare payments, and by providing direct funding to cover that raise and to cover new patients enrolled as a result of reform.

However, it is true that while many hospitals actually make an overall profit on Medicare patients, at the other end of the spectrum some hospitals lose more than average.One reason for some disparities is that Medicare payments to hospitals are not uniform throughout the country. In some areas, Medicare pays far more than in other areas. The differences can be quite large, with the highest paid hospitals collecting twice as much as the lowest paid. In some cases, this variation contributes to losses and has led to political controversy. “Blue Dog Democrats,” whose predominantly rural constituencies contain many of the low payment areas, are especially concerned.

As usual, this is more complicated than partisans would like us to think. Many rural hospitals in Blue Dog districts actually enjoy better than average Medicare margins, partly because of special adjustments to payments specifically for rural hospitals. Critics suggest that much of the focus on hospital payments was at least partially orchestrated by the Blue Cross plans to try to kill the public sector insurance option that progressive Democrats say we need to keep private insurers “honest”—and to give Americans choices.

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"The other big question regarding Medicare reimbursements to hospitals is whether hospitals are spending their money in appropriate ways. Everyone agrees that hospitals need to spend the money necessary to provide high quality care. However, many hospitals spend a great deal of money that is not directly related to patient care. More and more hospitals have invested large amounts in décor and esthetics, creating marble lobbies and hallways, building large patient rooms with features that mimic expensive hotel rooms, purchasing art installations, and so on. These amenities do not contribute to patient care. A visit to most European hospitals or to most VA hospitals illustrates that excellent care can be obtained in hospitals considerably less elaborate than many “flagship” hospitals. A few years ago I had the experience of visiting a friend who was a surgeon for Kaiser in the Bay Area. When I first saw his hospital, I was startled – it looked a lot more like a Motel 6 than a Four Seasons. Kaiser is a prospective payment system, so that when the money is gone there is no more. Kaiser also has to compete, at least partly on price, with other HMO’s and insurers in its market. That obviously results in closer attention to what is essential and what is not. However, the results attained at the hospital were excellent – according to the Dartmouth Data, better than at some of the “marble palaces” they compete with.

Salaries for hospital administrators have risen sharply in the last twenty years, with many hospital CEO’s now making seven figure salaries (and a few making eight figures,) and with lower ranked administrators paid proportional amounts. This makes its own contribution to costs.

Hospitals often invest large amounts of money in pleasing doctors who will bring them profitable patients. Many hospitals have overbuilt their angiography and OR capacity to make OR’s and angiography suites available at times when doctors prefer to operate, rather than distributing use through the day. OR’s are sometimes built to fit the personal demands of a surgeon, with side by side OR’s for other surgeons. An OR might be used only by a single surgery group or even a single surgeon and stand vacant when they are not operating. Angiography suites and their staffs might be jammed with work from eight AM to noon, but be shut down while the doctors tend their office practices, or take time off, in the afternoon.

Hospital units are customized to please doctors in other ways. Special parking garages for physicians, expensive meeting and dining facilities, and so on are all set up to attract the “right” doctors.

In the last few years, hospital advertising has exploded. In many cities you cannot drive very far, read the newspaper, or watch TV very long without seeing expensive ads for hospitals. Despite the recession, in 2008 total advertising spending by U.S. hospitals increased to more than two and one half times what hospitals paid for ads in 2001. The costs of these ads are added into hospital overhead—in other words, the charge for your appendectomy includes the cost for the ads. Ironically, this type of advertising is often the hallmark of “overbuilding.” When hospitals wind up with excess capacity, they are then forced to compete aggressively to fill the added beds. This gives costs a double whammy, first incorporating the costs of overbuilding, then absorbing the costs of advertising dictated by the overbuilding.
There is also a well documented hospital “arms race” going on in many markets. Hospitals vie to buy the latest and most impressive equipment, regardless of utilization or cost effectiveness. Relatively new and still useful equipment is discarded because of the perception that something is better. A two year old CT scanner may be replaced because a newer and shinier model is available. In a sense, this is a form of advertising aimed at both physicians and patients, trying to sell the notion that the hospital is the best and most modern.

All of this adds significantly to hospital costs without providing any real health benefit to patients."

And The Winners Are ....

As I posted previously, I've been running a contest in honor of this humble but lovable blog's birthday, and now I am happy to announce that two readers have each won a set of six movie posters from Turner Classic Movies -- I'm contacting them both and the winners are Michael Alvis and Ann Lloyd. Congratulations!!!

And my great thanks to all who entered, to TCM, and to each and every reader who takes the time to enjoy the rich, aromatic blend always offered in this Cup of Joe.

And here's to year number FIVE!!!

Local Blogger Says Health Care Is No Debate - It's A Matter of Life or Death

For a woman named Beth, a single mother of two, the so-called Health Care debate is not about politics of the Right or the Left, or the endless chatter on talk radio and television. For her, it is a matter of life and death.

Beth penned an letter to the East Tennessee blog OpenPen saluting them for their coverage of the debate and of her vital questions:

"Dear Editor,

I’m writing you, in part, to commend you for your fair and objective coverage of health care reform and town hall meetings. I’d also like to urge other media outlets and, more importantly, people to also be fair and objective in discussing health care reform. Though, for some people, especially pundits and politicians, health care reform is a vehicle for political posturing or personal bias. For millions of others it is a matter of personal health. And for far too many, like me, it is a matter of literal life or death.

My name is Beth. I am a divorced single mother of two wonderful children, ages 5 & 7. 3 ½ years ago I fell gravely ill to rare and potentially deadly, but treatable, disease called, Takayasu’s Arteritis. The rarity of my disease and severity of it’s debilitating symptoms led to me being misdiagnosed for the first 2 years of my illness. It is difficult to fully explain Takayasu’s Arteritis and its symptoms, in short form. But, in laymen’s terms, at 26 years old I have the vascular corrosion, bone density loss, joint inflammation and chronic fatigue of a person 60 years my senior.

Likewise, I am also susceptible to heart attacks and strokes. It takes a daily regimen of highly toxic and very expensive prescriptions to regulate my disease. But even the treatment of my disease begets a series of daunting side-effects, including, but unfortunately not limited to, hypertension, extreme weight gain, skin thinning/bruising, hair loss, lymph node tumors, cataracts and skin cancer. The symptoms of my treatment are often as painful and debilitating as my disease itself. But, for (and with) the love of my beautiful daughter and son, I willingly submit myself to whatever it takes to be here for (and with) them.

It is in this spirit of self-sacrifice and survival that I have been rendered financially ruined, due to medical debt. I am stranded in an all too familiar conundrum for uninsured/underinsured patients: Either pay for prescriptions and treatment or living expenses, gas and food. I’ve always been a hard worker, averaging 70 hour weeks as a restaurant general manager. But maintaining the rigors of my job accelerated the symptoms of my sickness. My doctors notified me that continuing to work would jeopardize my chances of recovery and possibly lead to premature death.

Subsequently, I could no longer hold employment. Which meant I lost what health insurance I did have through my job. I initially qualified for TennCare; but was ultimately denied, due to a cluster of state guidelines and regulations. Moreover, because I have a pre-existing condition, no private insurance company will insure me. Effectively, I have been shut out of every feasible resource on a state and private level. Without a federal ‘public option‘, I will quickly descend from shut out to shut down, literally.

With a ‘public option’ I would be able to purchase an insurance plan that would not only provide adequate treatment, but allow me to purchase my prescriptions at a much more attainable cost than the current overwhelming prices (which I can no longer afford). It pains me to see the ‘public option’ be battered about in consideration of only the ‘option’ (resources) aspect of the term, but not the ‘public’ (people) part. And isn’t that what this whole debate is about? The people? Is the primary focus of health care reform to save money or save lives? I understand that it’s not a strictly either or proposition. There is a give and take. But ‘how much money are we willing to give’ seems a much more reasonable and humane question than ‘how many lives does it take before health care reform is a must‘.

Personally, I went form an upwardly mobile, gainfully employed, tax paying citizen to a patient who will likely never have good credit again, nor a bank account/savings, a house or any significant possessions or assets of worth to leave to my children… an especially heartbreaking dilemma considering my faltering health and uncertain treatment resources. I want to leave them something more than medical debt, antagonistic bill collectors and a jaded sense of being let down by a system I’d so willingly paid into when my health provided me the ability to do so.

This is no way for a young mother to live or die in America. This is no way for anyone to live or die in the richest country in the world and most successful democracy ever established. There is no shortage of hyperbole, partisan rhetoric and political propagandizing now polluting the health care reform discussions in the mainstream media, blogosphere and town halls. My plea will likely not influence those who most voraciously feed off cacophony to be more responsible or constructive in the dissent or support of health care reform. But to anyone who is willing to adhere to reason, I ask you, please stop shouting. Yelling a lie does not make it anymore truthful. And the truth is no less true in a whisper.

Blogger Southern Female Lawyer also posted a video on YouTube of her recent Town Hall conversation with 1st District Congressman Dr. Phil Roe:



Some background on what Rep. Roe referred to as an "Associated Health Plan":

"The big problem is that AHPs would be allowed to operate outside of the requirements of the state’s health insurance law and so create two separate and very different markets for health insurance. One would be made up of AHPs, each of which would be rated on its own experience and operate outside the requirements and protections of the current small employer health insurance law. The second would consist of all other small businesses and individuals, whose experience would continue to be merged. The effect will be to pull lower cost and better risk employers into AHPs, leaving higher cost and higher risk groups and all individuals in the merged market, with higher premiums.

Morristown City Admin Forgives and Other Stories Hiding Out

Here's a brief round-up of new and blog reports which stand out to me - some are stories which should get more attention, and perhaps some should grab your attention with some intensity:

MORRISTOWN FIRES CITY ADMINISTRATOR WHO OFFERS FORGIVENESS FOR BEING FIRED:


"City Administrator Jim Crumley was "honored" at a reception at the City Center on August 18. At the council meeting that followed, Mayor Barile, Crumley's most ardent supporter, gave him a plaque and Crumley then gave his farewell speech to the assembled council and public. It was a whopper! He thanked the council and the staff for accepting his leadership and then said that there are issues of leadership in the current council.

Crumley added: "I forgive you all for the mistakes in judgment that you have made."

ALSO at that meeting, the City Council said they had no idea the city was pushing forward with expansion plans for their Industrial Park with the response of "we had no idea", saying:

"Sublett added that the Industrial Board is interested in an Exit 6 as well. He mentioned that the city owns no property there. Why is an exit needed there? Most of the property being looked at is in Jefferson County. Sublett closed by saying that he'd like to know if the council "has a clue" about what is going on at the Industrial Board. No one responded, but after a long silence, Mayor Barile said: "The Industrial Board is always looking to bring in new jobs."

Sublett replied: "You already have 600 acres out there. The City is already 77 Million in debt. How are you going to buy more property? Who's going to fund that?"

No member of the council spoke. If they knew anything about discussions about purchasing property in Jefferson County and two next exits, councilmembers and the Mayor were not talking. Finally, Barile thanked Mr. Sublett and said: "I will talk with the Industrial Board and see what is happening."

She may do it, but I would suggest that no one holds his or her breath while waiting for Barile to find out and actually report to the council and to the public about what is going on at the Industrial Board in regard to purchasing property in Jefferson County or pushing for two new exits on I-81.

Hopefully, Mayor Barile has not signed any "confidentiality" agreement with the Industrial Board or others--like Jefferson County Mayor Alan Palmieri did--where she has agreed to keep public business a secret from the public. [Jefferson Countians found out that their Mayor, Alan Palmieri, and two county commissioners signed confidentiality agreements with Norfolk-Southern railroad and thus agreed to keep information about public business a secret. Word got out in Jefferson County, but only after word leaked out that discussion and conduct of public business was taking place behind closed doors. Someone needs to get an understanding of what the meaning of "public business" is and what the Tennessee Open Meetings Act is about. Of course, Hamblen County has its own problems abiding with the Open Meetings Act. Here and here.]


CHATTANOOGA SUSPECT SHOT 49 TIMES BY POLICE, FEDERAL SUIT FILED:

The police are calling it "suicide by cop" as a distraught and armed man stood on his porch at home in July. The Chattanooga Times Free reports there were 53 shots fired over the course of three full volley of shots:

"The family of a man shot multiple times by six Chattanooga police officers claims the officers were not adequately trained in use-of-force policy and created an "atmosphere of illegal and unconstitutional behavior" in "deliberate indifference and reckless disregard" for the public welfare, a federal court lawsuit states.

Alonzo Heyward, 32, died July 18 with 43 bullet wounds in his body.

Mr. Heyward's parents, James and Margie Marine, filed suit last week, seeking compensatory and punitive damages, attorney fees and a judgment that the police department's policies, practices and customs are illegal and unconstitutional, according to the suit.

The lawsuit is filed on behalf of Mr. Heyward's beneficiaries, including Neka Wells and Tanisha Johnson -- the mothers of his children.

It names as defendants the City of Chattanooga, the city police department and the six officers involved in the shooting: Lauren Bacha, Deborah Dennison, Zachery Moody, George Romero, William Salyers and Bryan Wood.

"The defendants have a policy, practice or custom of allowing its officers to use deadly, excessive and/or unreasonable force without fear of discipline creating an atmosphere where such behavior is accepted, condoned, tolerated, acquiesced, approved and ratified in reckless disregard and deliberate indifference to the welfare to the public at large, including Mr. Heyward," according to the suit."

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"The lawsuit alleges that Mr. Heyward kept his rifle pointed at himself at all times and did not say or do anything that would have made the officers fear for their lives. The suit also says that the officers fired in three separate volleys totaling 59 shots and, after the initial barrage, fired again "suddenly and without warning." (report via the Chatanooga Times Free Press)

CUMBERLAND COUNTY RESIDENTS SUE TVA OVER COAL ASH DUMP, BUSINESS ADDS ANOTHER LAWSUIT:

Life On Swan Pond reports: "But now comes the news that the old coal mine at the top of the hill will become a mammoth dump site for TVA's enormous stockpiles of coal ash.

"Well, for what? TVA has 2,000 to 3,000 acres of their own," Brundage said.

Brundage and 16 other neighbors are suing the county mayor and county commission under the Jackson Law, a law that says elected bodies must consider eight things before making a decision including property values and safety.

The people who live on Smith Mountain Road said both of those will be ruined.

The lawsuit alleges Mayor Brock Hill told residents it was a done deal two full weeks before the first public hearing. The residents were also led to believe, they say, that the dumping would end after three years, but it's now open-ended.

ALSO the Knoxville News Sentinel notes more legal problems for TVA and their catastrophic coal ash spill:

"The lawsuit alleges that the spill caused elevated levels of lead, thallium, arsenic and other heavy metal toxins in the river water, affecting recreation on Watts Bar Lake and other areas downstream. It claims the situation has caused property values in the 90-acre Lakefront Estates to decrease and has diminished the appeal of water recreation at the development.

Because of the spill, TVA so far has been the target of seven federal lawsuits involving hundreds of property owners and four class action suits, but this appears to be the first lawsuit filed by a commercial operation claiming damages.

The lawsuit cites TVA reports as well as a review of the ash spill by TVA's Inspector General to claim that TVA did not take proper measures to prevent the spill.

"As a result of TVA's conduct described herein, Plaintiffs have lost the sale of multiple lots, the development has diminished in value, the recreational amenities afforded by the development have been substantially affected and the whole development and its purpose herein described, has been unreasonably interfered with by TVA as a result of the spill," according to the lawsuit.

REPUBLICANS TO GATHER AT ANGRY VOTER PROTEST AGAINST GOVERNMENT:

The event is scheduled for Labor Day - a holiday created by government - and will be attended by numerous elected Republican officer holders (and some currently not in office or seeking higher office. The KPT reports:

"Event organizers are billing the Tea Party-style rally as a “nonpartisan peaceful protest giving local citizens the opportunity to voice their anger over tax rates and deficit spending. This Rally, they say, will focus on “government excess” and two pieces of legislation being debated by Congress — the so-called cap-and-trade bill and health care reform.

“This is not an (President Barack) Obama bash. We want to protest anybody of any party who would dare to spend trillions of our dollars without even reading the bill,” rally organizer Brit Buehrig said in an e-mailed release.

Speakers at the event are expected to include U.S. Rep. Phil Roe, former U.S. Rep. David Davis, Lt. Gov. Ron Ramsey and state Reps. Tony Shipley, R-Kingsport, and Matthew Hill, R-Jonesborough. All are Republicans.

Buehrig said the event is “above party affiliation.”

Note that the U.S, Dept. of Labor terms the holiday as: "the first Monday in September, is a creation of the labor movement and is dedicated to the social and economic achievements of American workers. It constitutes a yearly national tribute to the contributions workers have made to the strength, prosperity, and well-being of our country."

Meanwhile, at KnoxViews, hysterics and rumors are reaching a full-blown crescendo of howls from the ill-informed and the downright lying prompters of The Dangerously Strange:

"A Republican candidate for Governor of Idaho joked about getting license to hunt President Obama. He later said everyone should have known he was joking because Idaho doesn't have jurisdiction over hunting in D.C.

A Baptist preacher in Arizona gave a sermon in which he prayed for the death of President Obama and his family. A member of his congregation showed up at an Obama health care rally toting an assault rifle and a handgun.

The Secret Service detained a man carrying a "Death to Obama" sign at a town hall meeting in Maryland.