Obamacare

Bureauwonks Once Again Fail to Fix America's Health Care System

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Here are some totally random numbers. Let's pretend they mean something!

The bureauwonks blew it this time: Proposed regulations intended to save money by encouraging greater coordination of care amongst health providers have instead been rejected by the organizations that first inspired the idea.

ObamaCare's backers have insisted over and over again that the law helps control health spending through "delivery system reform"—by reorganizing, in other words, how medicine is practiced and paid for. And one of the law's most promising reforms, super-wonks like Medicare director Donald Berwick argued, was the creation of so-called "accountable care organizations" (ACOs), which encourage medical providers to coordinate their efforts in smart networks that many hoped would lead to cheaper, more efficient care. As evidence, they pointed to a few model provider groups like the Mayo Clinic, the Cleveland Clinic, and the Geisinger Health System in Pennsylvania. 

At the end of March, the Obama administration's Department of Health and Human Services released its first draft of the proposed ACO rules: 400-plus pages of regulatory legalese designed to tell doctors, medical administrators, and other health providers exactly how they ought to be coordinating their care and practices in order to appease the the administration's health bureaucrats. So will the new regulations usher in an era of smarter, more coordinated care like we've seen in those model providers networks? Not likely: A number of those care organizations took a look at the rules the Obama administration is proposing to set up and politely said something to the effect of, "No thanks." Mayo, for example, told Congressional Quarterly that there would have to be "substantial revisions" in order for the clinic to think about participating. The Cleveland Clinic has indicated that the proposed rules would put significant barriers in the way of their current (model!) care practices. And a representative from Geisinger said that the organization has "a large number of concerns" with the proposed regs: "A lot of the detail-level work is problematic. It seems to be very prescriptive and restrictive with a fair amount of administrative and regulatory oversight."

It's not the model that's wrong: In an age of complex medicine, coordinated health care may end up being better health care, and possibly even cheaper. The problem isn't with doctors and other proviers coordinating; it's with the federal government telling them how to do it. 

Lots more on ObamaCare's ACOs and why they aren't likely to work here

NEXT: "Why Should Fourth Amendment Protections Be Lessened to Prevent the Destruction of Evidence?"

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  1. Yep. Everyone is running from these regs. I spent the morning polishing up my comments, now running to 6 pages.

    The fundamental problem is that ACOs require you to either (a) reduce your topline revenue from CMS in exchange for CMS giving you a fraction of the amount you just gave up, or (b) giving CMS the increase in your topline revenue.

    Yeah. That’ll work.

    1. R C,

      You’ve noted your involvement in some of this health industry stuff before. Can you say what exactly do you do?

      1. He screws patients for the hospital

        1. do he use KY gel covered by medicare?

      2. Never mind what he does, what would he do to improve costs for patients, and hospital efficiency.

        I dare you to write that article Suderman

      3. Can you say what exactly do you do?

        In-house hospital attorney.

    2. What RC said. We’ve got pages of “We’d really like to want to help”

    3. This is why the description of ACOs as HMOs in drag is inaccurate in a way that’s not to the ACOs advantage – it would be more accurate to call them HMOs without balls. The big advantages for cost control in HMOs is that since the insurer and providers are the same financial entity it never makes sense to run up charges – the ACOs only offer a partial refund, so there will still be cases where it makes sense to stack on high margin procedures. And while they claim they won’t suffer fromt the same consumer happiness issues as HMOs related to restricted networks, the incentives are very strong to keep patients in the ACO’s provider network and for out of network providers to either not take patients from someone else’s network (since they don’t get a slice of the ACO reimbursement) or run up charges on those patients (which now has the advantage of hurting a competitors margins via reduced reimbursements since the ACO is held accountable for the patient’s overall care costs).

      The distortionary impact on care is going to be even greater – the existing incentives to avoid low or negative margin procedures by referring to a specialist who can run higher margin specialized procedures will be increased, since the same financial entity will get money back from avoided low margin procedures and the extra profits from higher margin substitutions. And since it’s going to drive consolidation in the overall healthcare market, reduced competion is going to make it harder to establish market prices for those speciality procedures, making running up the margins easier in negotiations.

      It’s the same ideas the insurance industry came up with in the 90s, but weaker and with extra perverse incentives.

  2. Mayo, for example, told Congressional Quarterly that there would have to be “substantial revisions” in order for the clinic to think about participating.

    Revisions like “Participation is Mandatory”, that kind?

  3. We’re starting to see a pattern here. Since the Supreme Court restored the First Amendment rights of businesses and unions in last year’s Citizens United ruling, Democrats have been searching for a way to claw back control over political speech. The latest bureau to get the memo is the Internal Revenue Service, which may retroactively tax top donors to political advocacy groups.

    In the crossroads, er, cross-hairs, are nonprofit groups that register under section 501(c)(4) of the tax code and spent millions on political advertising in the last election cycle. Big donations to those groups, the agency now says, should have been subject to gift taxes and may be owed retroactively. In a letter to one donor, the IRS noted that it “had received information that you donated cash to . . . an IRC Section 501(c)(4) organization . . . and your contribution should have been reported on your 2008 federal gift tax return.”

    The letters are especially odd since the purpose of the gift tax has traditionally been used in coordination with the estate tax, to prevent people from avoiding the tax by divesting their wealth before they die. Contributions to 501(c)(4)s aren’t a routine death tax avoidance mechanism, and the contributions now under scrutiny are a pittance compared to overall gift tax revenues. So, hmmm, what could be the reason to start asserting the provision now, and only against a handful of high-profile political donors?

    http://online.wsj.com/article/…..on_LEADTop

  4. If I’m going to be told how run things efficiently, I prefer to be told by someone with a track record of doing such. The fed’s track record would exclude them from consideration.

    1. Lawyers who work for the hospital are there to make sure their master makes more money, not less. When efficiency means less money, it will be resisted. Yes, some of the regulation will not make sense in their application but the ones that do will be resisted equally.

      ditto doctors

      1. Lawyers who work for the hospital are there to make sure their master makes more money, not less.

        Not really, no. Financial performance is not part of my portfolio (we have other people for that).

        My job is mostly, in no particular order, (a) making sure nobody goes to jail, (b) making sure we don’t sign anything stupid, (c) meeting potential litigants in the parking lot with baseball bat, and (d) making sure nobody loses their license.

        There’s a little lobbying thrown in occasionally, and oversight of outside counsel, plus some drug diversion since I have a master key for the hospital.

        1. Anyone with any experience around the administration of health care knows that when the government gets involved, efficiency is the opposite of what they do.

          1. (a) making sure nobody goes to jail, because finding the legal angle, or preventing a procedure can save money but your duty is to save $

            (b) making sure we don’t sign anything stupid, that will cost the hospital more $

            (c) meeting potential litigants in the parking lot with baseball bat, and letting them know we will make sure we win because we need to set an example, and not allow precedence, and besides your job is to save the hospital $

            (d) making sure nobody loses their license, because recertification ain’t cheap, and cost the hospital $

            RC, I am sure you are pretty but you are a lawyer for a hospital to make , or save money, and your interest will never be patient care, or making the hospital less $

            1. for a hospital to make , or save money, and your interest will never be patient care,

              Yeah, nothing bumps up the bottom line like a bad reputation and a stack of malpractice judgments.

              1. Interesting that a lawyer doesn’t know about the confidentiality agreement game

                1. I find it unsurprising that you are unaware that all malpractice judgments are public record, and all malpractice judgments and settlements are reported to a federal database.

                  1. Not only that, but if the malpractice insurance company finds it less costly to settle the case, even if the physician did absolutely nothing wrong, it stays on that physician’s record for life. Some physician insurance companies allow the doctor to make that call, but many do not.

                    1. it stays on that physician’s record for life

                      Really?

                  2. Really? Are you saying the info is available in all states, and that the reporting standards are homologous?

                    1. rather|5.18.11 @ 7:36PM|#
                      “Really? Are you saying the info is available in all states, and that the reporting standards are homologous?”

                      Really? Are you saying you are stupid enough not to answer your own question?

                    2. she is setting a trap

      2. Says somebody who obviously knows fuck-all about running a business. Greater efficiency means you can deliver the same product for less cost. If you keep charging the same prices and get more efficient, you make more money.

        So, explain again how being more efficient makes hospitals less money, fucktard?

        1. This is classic
          http://rctlfy.wordpress.com/20…..sics-wins/

          You see Mr. I read about starting a business but I don’t know what the fuck I am talking about in the real world,

          machines cost money, and they will be damned if they don’t use them AMAP, whether the patient needs it or not

          1. What color is the sky on your world, rather?

            1. Two degrees and that’s all you can come up with?

              1. rather|5.18.11 @ 7:47PM|#
                “Two degrees and that’s all you can come up with?”
                Oh, how……………
                infantile.

      3. “Lawyers who work for the hospital are there to make sure their master makes more money, not less. When efficiency means less money, it will be resisted.”

        God forbid businesses hire lawyers to keep track of their contractual obligations and legal liabilities!?

        Who should they hire for that? Electricians? Or are you suggesting that in Libertopia, people won’t have contractual obligations or legal liabilities?

        Honestly, I don’t get it. If you wanted to lash out at somebody, you should probably go after the coders or somebody–but even then!

        God forbid hospitals try to maximize their income–is that what we’re supposed to think? ’cause in Libertopia, businesses won’t try to maximize their income?!

        1. Honestly, I don’t get it. If you wanted to lash out at somebody, you should probably go after the coders or somebody–but even then!

          God forbid hospitals try to maximize their income–is that what we’re supposed to think? ’cause in Libertopia, businesses won’t try to maximize their income?!

          No, you don’t get it. The discussion is in contest of government health care and their demand of efficiency. Yes, businesses are there to make money but should they be able to charge an Inuit more money for the same procedure that they billed the Pacific Islander? IOW, should they run a Dun and Bradstreet to calculate how much they can disencumber your finances?

          Efficiency will lead to transparancy, and less money. Of course, lawyers and doctors will fight it

          1. rather|5.18.11 @ 4:59PM|#
            …”Efficiency will lead to transparancy, and less money. Of course, lawyers and doctors will fight it”

            I’m guessing it possible to load more bullshit in the same number of words, but I’d have to see it.
            Stupid sack of shit.

          2. Yes, businesses are there to make money but should they be able to charge an Inuit more money for the same procedure that they billed the Pacific Islander?

            Yes. Next question?

            1. The Siamese fescennine twins. How lucky can a girl get?

              1. rather|5.18.11 @ 7:44PM|#
                “The Siamese fescennine twins. How lucky can a girl get?”

                Uh, finding a brain cell?

      4. Truly a moronic statement. The only time you do not worry about efficiency is when you can skirt market forces. If a hospital is not worried about efficiency then it is guaranteed to be related to some government regulation.

        In a competitive market you cannot make undue profits. Ofcourse that is what licensing and such pratices are for, to limit the competition. I lack sympathy for the medical community because they have been supportive of the government limiting competition for many years. Now that beast is biting them. Hopefully they will learn their lesson.

      5. “Lawyers who work for the hospital are there to make sure their master makes more money, not less. When efficiency means less money, it will be resisted. Yes, some of the regulation will not make sense in their application but the ones that do will be resisted equally.

        ditto doctors”

        I assume you work for or own an organization that exists for altruistic motives only and doesn’t care at all about making money? I’d start looking for another job now, because you won’t have one for long. Seriously, I don’t care where you work, in some way your job exists because it makes the company money. If you think otherwise you’re deluding yourself. Even government employees provide a “service” which they can point to at tax time as justification for remaining employed.

        By the way, in a business context efficiency results in greater profits, not less. You aren’t talking about efficiency here. If you seriously think 400 pages of legal gibberish is going to make things more efficient, you are too deluded to be taken seriously. In medicine particularly there is a whole lot of paper pushing and jumping through hoops that happens on a daily basis to comply with ludicrous government regulation that has nothing to do with caring for patients. You just don’t have a clue what you’re talking about.

        By the way, demonizing entire groups of people in order to attempt to make some sort of argument is sort of counter-productive. You make yourself look like an intellectual weakling.

        1. The fact that you obviously did not read the whole thread tells me I am dealing with a typical physician.

          Ladies and gentleman, this is why you discuss any prescribed medication with a pharmacist

          1. Way to not respond to any point. It must be like being stark naked in a joust to be you in an argument.

            1. It must be like being stark naked in a joust to be you in an argument.

              Confidence is intimidating; isn’t it

              1. rather|5.18.11 @ 7:50PM|#
                “Confidence is intimidating; isn’t it”

                Dealing with confidence in rank stupidity isn’t intimidating, it’s amusing.
                Wrong place for a semicolon and you left out the question mark, oh confident sack of shit.

                1. sevo, I cannot play with you, for you are too special for me

                  1. sevo, I cannot play with you; for you are too special for me

                    1. ; are a style issue 🙂

                    2. Confidence is intimidating; isn’t it

                      It was not a question. It was tag question 🙂

                    3. rather|5.18.11 @ 9:41PM|#
                      “It was not a question. It was tag question :-)”

                      Yep, sorta like the end of the world come Saturday; stupidity on a stick, with *CONFIDENCE*!

                    4. Get a new stylebook.

            2. No.

              Wrong.

              It does

              I don’t and I’m not

              Irrelevant and off topic

              Not always true. Equipment is cost prohibitive and is often used for financial purposes

              Yes, I am

              I never said it would. Read my challenge up thread.

              I’m aware but medicine danced with the devil, and now they are paying for it

              Yes, I do

              Poor babies; did I fucking hurt someone’s feelings again?

              I’m smart enough to know I am not to smart to stop learning

              1. rather|5.18.11 @ 8:04PM|#
                …”Poor babies; did I fucking hurt someone’s feelings again?”
                No, you confirmed your stupidity. Again.

                “I’m smart enough to know I am not to smart to stop learning”
                Obviously not.

    2. good luck w that water!

      1. You do realize there’s an argument that the CoE flood control and mitigation efforts make flooding worse when it does occur, right?

  5. “As evidence, they pointed to a few model provider groups like the Mayo Clinic…”

    My understanding is that the Mayo Clinic routinely costs less than what nearby clinics and hospitals cost Medicare. Also, I understand that the Mayo Clinic roundly criticized ObamaCare when it was proposed for increasing costs and doing nothing to improve the quality of patient care.

    At some point, you’d think ObamaCare’s backers would stop bringing up the Mayo Clinic. It’s existence, quality and cost are all a functioning, living indictment of ObamaCare.

    If Jean Bart were here, he might say that ObamaCare’s backers should stop before they embarrass themselves further.

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