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What Doctors and Patients Have to Lose Under ObamaCare

Original post made by Pleasanton Mom, Birdland, on Mar 20, 2010

Obamacare will give the Feds control of surgical decisions. Primary-care doctors who refer patients to specialists will face financial penalties under the plan.


DECEMBER 23, 2009
What Doctors and Patients Have to Lose Under ObamaCare

By SCOTT GOTTLIEB, Wall Street Journal

Democrats are touting the American Medical Association's endorsement of President Obama's health plan. But there's an important reason why the American College of Surgeons and 18 other specialty groups are opposed.

The plan's most tangible efforts to restrain medical costs are through its controls on specialist physicians. Based on the government's premise that they often make wasteful treatment decisions, the health-care legislation in Congress will subject doctors to a mix of financial penalties and regulations to constrain their use of the most costly clinical options. The penalties and regulations are aimed first and foremost at surgeons and the medical devices that they use, largely because that's where the bulk of spending is.

It all starts with the sweeping power that the Senate bill gives to the Centers for Medicare and Medicaid Services. The agency will be given the authority to unilaterally write new rules on when medical devices and drugs can be used, and how they should be priced. In particular, the Obama team wants to give the agency the power to decide when a cheaper medical option will suffice for a given problem and, in turn, when Medicare only has to pay for the least costly alternative.

The government has already sought to acquire this same power administratively. But on Tuesday the Obama Justice department got swatted down by the U.S. Court of Appeals for the D.C. Circuit, in what the judges described in their opinion as an attempt by Mr. Obama's legal team to "end-run around the statute [Medicare]."

Hays v. Sebelius involved a patient who said Medicare unfairly denied her a prescribed treatment for her serious lung disease. Medicare decided instead to pay for a different drug that bureaucrats argued was a suitable but cheaper alternative.

Now the Obama team will use murky provisions embedded in the Senate bill to subtly attain in law those powers they couldn't more artfully acquire in court. In fact, the bill lets Medicare seek almost any restrictive payment authority it wants from a Medicare Commission established for the purposes of cost control.

If Congress believes Medicare has overreached, it has to pass a separate law to explicitly block the agency's newly acquired powers. These provisions are deliberately designed to leverage Congress's inability to act in a timely fashion.

The Senate health-care bill also exempts Medicare's actions from judicial review, taking away the right of patients to sue the government. Unlike existing Medicare coverage laws, patients won't have the ability to appeal any of the decisions of this new Medicare Commission.

Ironically, private health insurers must comply with new patient appeals rights under the Senate bill. The government has exempted itself from the same sort of protections.

Thus Medicare will have the power to control which medical devices surgeons use. But clamping down on expensive procedures also means the agency will need to have authority over the specialists themselves. The organization of doctors into mostly small, disaggregated practices always made it hard for a central bureaucracy to control individual physicians. ObamaCare tries to fix this by putting doctors on the financial hook for their treatment decisions.

Primary-care doctors who refer patients to specialists will face financial penalties under the plan. Doctors will see 5% of their Medicare pay cut when their "aggregated" use of resources is "at or above the 90th percentile of national utilization," according to the chairman's mark of Section 3003 of the bill. Doctors will feel financial pressure to limit referrals to costly specialists like surgeons, since these penalties will put the referring physician on the hook for the cost of the referral and perhaps any resulting procedures.

Next, the plan creates financial incentives for doctors to consolidate their practices. The idea here is that Medicare can more easily apply its regulations to institutions that manage large groups of doctors than it can to individual physicians. So the Obama plan imposes new costs on doctors who remain solo, mostly by increasing their overhead requirements—such as requiring three years of medical records every time a doctor orders routine medical equipment like wheelchairs.

The plan also offers doctors financial carrots if they give up their small practices and consolidate into larger medical groups, or become salaried employees of large institutions such as hospitals or "staff model" medical plans like Kaiser Permanente. One provision, laid out in Section 3022, allows doctors to share with the government any savings to the government they achieve by delivering less care—but only if physicians are part of groups caring for more than 5,000 Medicare patients and "have in place a leadership and management structure, including with regard to clinical and administrative systems."

While these payment reforms are structured as pilot programs in the legislation, this distinction has little practical meaning. Medicare is being given broad authority, for the first time, to roll these demonstration programs out nationally without the need for a second authorization by Congress.

Regulation of medicine has always been a local endeavor, and it's mostly the province of medical journals and professional medical societies to set clinical standards. This is for good reason. Medical practice evolves more quickly than even the underlying technologies that doctors use. This is especially true in surgery, where advances flow from experimentation by good doctors to try different surgical approaches.

The regulation of medical devices and their pricing will also have consequences for patients by discouraging innovation. Most improvements in medical devices come incrementally, with each generation of a device having small but clinically relevant advance over prior versions. This owes to the underlying hardware, which turns on embedded software and microprocessors that themselves undergo constant upgrades.

But if Medicare starts pricing similar devices off one another—a form of the same "reference" pricing schemes used in Europe—manufacturers will start holding back the small changes. Instead, they will introduce new models every four or five years that are sufficiently unique to fall outside of Medicare's pricing scheme. Meanwhile, patients will have lost the benefit of regular improvements and annual upgrades that characterize medical devices today.

The impact of these provisions won't be confined to Medicare. Private insurance sold in the federally regulated "exchanges" will take cues from Medicare, since they're both managed from the same bureaucracy. Medicare will set the standard for medical care across the entire marketplace.

Mr. Obama promised that under his plan people wouldn't have to change their doctors. But it's clear that doctors will be forced to change how they make their medical decisions.

Dr. Gottlieb, an internist and a resident fellow at the American Enterprise Institute, is a former senior official at the Centers for Medicare and Medicaid Services. He is partner to a firm that invests in health-care companies.


Comments (11)

 +   Like this comment
Posted by Please stop sounding so ignorant
a resident of Another Pleasanton neighborhood
on Mar 20, 2010 at 10:29 am

Pleasanton Mom:

If you want to be taken seriously, you should not call it Obamacare. I am an independent and find all those who talk about Obamacare (yes, Rush included) a bunch of ignorant fanatics.

If you want to influence people, the first thing you need to do is stop: calling health care reform Obamacare, stop denying that global warming is real, stop questioning Obama's US citizenship, stop saying you don't want government run healthcare while at the same time defending Medicare (who do you think runs that?)


 +   Like this comment
Posted by Pleasanton Mom
a resident of Birdland
on Mar 20, 2010 at 10:36 am

That wasn't my terminology. It was the actual title of the published article.

Personally, I don't call it Obamacare. I call it what it really is: Government Takeover of Healthcare.


 +   Like this comment
Posted by Please stop sounding so ignorant
a resident of Another Pleasanton neighborhood
on Mar 20, 2010 at 11:06 am

Pleasanton Mom:

But when you post something that talks about Obamacare, you lose credibility even if it not something you wrote.

I do not like the healthcare "reform" and have called my representatives to express my wish that they vote no on it.

However, I think that even if the GOP may have valid points about why this reform is not a smart move and it will hurt rather than help, the way to influence others is to do so with facts.

I looked at Rush's website, and boy, that guy knows who his audience is and how to make money. Unfortunately, the people who actually believe the nonsense Rush talks about are the same people that had a lot to do with Obama being elected. Yes, they are the ones who pressured the GOP into choosing someone like Palin as the VP choice - just to rally the right wing base.

Influence others by sounding smart, not by quoting articles that call healthcare Obamacare.


 +   Like this comment
Posted by RN
a resident of Another Pleasanton neighborhood
on Mar 20, 2010 at 11:10 am

To those who support this bill........

I have dedicated, w/ a real passion, 35 years of my life in health care as a critical care RN. I still work 40hrs/week. This bill is not about health.....not about care. If it was not soooooo sad, I'd love to be around when those of you who support this actually get impacted w/ the consequences of this bill. Not just you, but when you experience how your family (yes the elderly, your parents) are impacted, maybe then you will understand. But perhaps, not. Your ideology obscures the realities we are about to experience.

But I do know this for sure about those who support THIS bill: you will be the first and the loudest complaining to me about the lower standard of care you and your loved ones are receiving. But since me, as your patient advocate and your MD, as the director of your care, will now be working for the government, (vs for you) our jobs, sadly, will become much easier. Your government run health care will now determine your plan of care.

You may say "its that way now w/ the insurance companies. WRONG.

As an RN, my primary job is to advocate for the patient and family. Make sure they get what is considered safe health care.

Who will I go to when this bill passes to assure that you get what you need? The MD? He will have no more authority then that the government grants him. His process will no longer involve critical thinking to serve your best interest, but rather a list of what he is allowed to do.

It will begin gradually, and like all incurable diseases, it will eventually kill the very life of our health care delivery system.

If you think I am exaggerating, just remember "I told you so". If you think I am trying to scare you, then how could I have dedicated 35 yrs of my life going above and beyond to assure good, quality care and now want to scare the very people I have tried to serve. I am only grateful that those 35yrs were spent under the current system.

My RN role to fight your battles to assure good, safe care, will cease to exist and the MD's hands will be tied to authorize what is in the best interest of you or your loved one. You will see fewer diagnostics (or less timely ones). Without a diagnosis,or a timely one, then treatment does not need to be implemented. Enter stage right, ration care.

And to those of you who will complain first and the loudest....... Be prepared now to hear: " Take it up w/ your government run health care NON LICENSED representative. 1-800 etc"

Frankly, the time to help you was now....but it seems too late...you let your ideologue or your politics get in the way.

Now, like any "bad" or "wrong" medicine, you will experience the side effects. Unfortunately, you pulled all of us, the delivers of health care and the receivers of health care, down with you.

RIP


 +   Like this comment
Posted by Please stop sounding so ignorant
a resident of Another Pleasanton neighborhood
on Mar 20, 2010 at 11:23 am

"Who will I go to when this bill passes to assure that you get what you need? The MD? He will have no more authority then that the government grants him. His process will no longer involve critical thinking to serve your best interest, but rather a list of what he is allowed to do."

RN:

There are many problems with the healthcare bill: cost is the main one, but there are other serious problems like what to do about illegals, more taxes to keep Medicare intact, etc.

However, the argument you make is not quite right. Look, even right now my PPO which is a great insurance plan has restrictions. I have to go to an in-network doctor or be subject to out of network fees (which can get pretty big), I have to ask for approval for certain procedures.

Yes, under the government, this would all be lost with the first incompetent person that gets a hold of my file. My point is, the restrictions for healthcare (death panels as some in the GOP refer to them) already exist, but just in a different form.

I do not like the Health care bill, and even if we need some sort of reform, we cannot do it now because the economy is pretty bad and we have too much debt.

Reform needs to be done in a smart way, and it needs to wait until we are no longer in a recession.


 +   Like this comment
Posted by can't believe
a resident of Apperson Ridge
on Mar 20, 2010 at 11:30 am

To pleasanton Mom who says: " stop saying you don't want government run health care while at the same time defending Medicare (who do you think runs that?"

We have seen the consequences of MEDICARE and the VA for that matter. We don't need to CREATE yet another failing GOV RUN program.

I can defend Medicare and at the SAME TIME SAY: DON'T CREATE ANYMORE GOV RUN HEALTH CARE!

chew gum and walk lately?







 +   Like this comment
Posted by RN
a resident of Another Pleasanton neighborhood
on Mar 20, 2010 at 12:22 pm

To Please stop:

I totally agree w/ you on the issues re: cost, illegals, medicare, increment steps to strengthen our health care delivery however re: your statement below I'd like to respond.

Please note my rationale was "right" on for INPATIENT care. The acuity of a patient's health care needs are far more critical IN-HOUSE then they are as an outpatient. And IN-patient is where you are going to see the first big hit to quality.

You said: "I have to go to an in-network doctor or be subject to out of network fees (which can get pretty big), I have to ask for approval for certain procedures."

Yes, as an OUTPATIENT you are the one fighting your own battles. And often that job requires time, effort and an understanding of the benefits and risks associated with getting "certain procedures". Which is why the more you know as the patient, the better it will serve you and your family.

However I'd suspect there are 2nd opinions within your PPO who might assist you w/ that fight. But even if that 2nd opinion failed to secure you what you needed, then yes, YOU might have to pay out of pocket, if in fact you felt certain the procedures were necessary. But at least you would access to that "certain procedure"

Restrictions do exist within our current system. But access to those "procedures" or treatments are still available if one is willing to pay as you noted. Like anything, it has a cost.

This will not be the case w/ this new bill in the long term.

"Restrictions" that exist in its current form may look differently to many. But the process to get those "restrictions" removed simply will not exist, even if you wanted to pay out of pocket. So access, I guarantee you, will get even worse....In-patient first, then outpatient.

PS: Equally a threat to your health care, will be the quality of people going into the health care profession. There is absolutely no doubt in my mind, the brightest and best will not be drawn to the Health profession. This includes Physicians, RNs etc. anyone who needs a LICENSE. You will see, though, an increase in NON LICENSE people (SEIU) trying to compensate. Patient BEWARE.

Good luck and I do wish you good health..



 +   Like this comment
Posted by RN
a resident of Another Pleasanton neighborhood
on Mar 20, 2010 at 1:17 pm

I forgot to mention that the revised draft of the bill which WILL BE VOTED ON TOMORROW has re-introduced the death panels.


 +   Like this comment
Posted by Pleasanton Mom
a resident of Birdland
on Mar 20, 2010 at 2:14 pm

Hi RN,

Death panels are consistent with Socialist Governments. But in the Bill it's called the Federal Coordinating Council for Comparative Effective Research. This new panel was already passed in the $787 Billion Stimulus bill.


 +   Like this comment
Posted by RN
a resident of Another Pleasanton neighborhood
on Mar 20, 2010 at 2:18 pm

The post directly above this was not posted by me.
They" used my "RN" name and cited same "neighborhood"

The person who STOLE my RN "name" wrote this:

"I forgot to mention that the revised draft of the bill which WILL BE VOTED ON TOMORROW has re-introduced the death panels."

Like many in this health care debate, ethics and honesty has seem to slip by the wayside. Integrity even on a a post , is lost.

I did NOT write post : "the revised draft of the bill which WILL BE VOTED ON TOMORROW has re-introduced the death panels."

Like any SAFE RN, I will the 1st to say I have NO IDEA if that statement is accurate .

People do your own homework.

The real RN (not the imposture)




 +   Like this comment
Posted by Cholo
a resident of Livermore
on Mar 20, 2010 at 2:22 pm

I just heard an INSPIRING SPEECH by President Obama and I am confident that the reform is not only the best thing for our country but also for those who are here illegally. FINALLY, health will be available to US residents.

I think that the bill pass on Sunday...tomorrow!

HOORAY!


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