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Health Wonk Review May 4 (actually May 8) edition

My regular job took precedence over getting HWR out on time last week – apologies to those of you who have been sitting at your keyboards waiting eagerly for the latest edition to once again enter the bitstream.
This edition’s submissions range from the near-global to the very specific; they do share a common thread of (mostly) deep insight. So, enough from me and on to the musings of the health wonk-o-sphere…

Universal coverage – the topic du jour
There were a string of related posts at several blogs that touched on universal coverage. Here’s a few of the more salient entries.
Michael Cannon opines that universal coverage may not be truly universal if patients still have limited access to treatment. MIchael suggests the desire for universal coverage should be balanced against the experience of other nations, citing anecdotal and statistical evidence about waiting times for certain procedures.
Also entering the fray was Kate Steadman, who is leaving the blogosphere for actual employment…at least for now. Here’s hoping Kate rethinks her decision to disappear inside the Beltway…
Kate, who’s research diligence makes us old-timers wonder how the young are so much smarter and better than we were at that age, digs into the statistics behind Michael’s post, comparing Americans accessing Canadian health care resources with Canadians accessing American resources. Her conclusion – less than 0.1% of Canadians are seeking care in the US, while 8% of Americans have bought drugs from Canada.
Jon Cohn’s contribution makes the fact-based (subtle pun intended) argument that the “waiting times”, “rationing” and “access” issues are, well, non-existent.
Politics, Policy and Economics
Boy, there is some great stuff here. Off we go…
HWR co-founder Matthew Holt has linked some of the recent trends in health insurance at riting at politico site Spot-on… Matthew ties the news that employer-based health insurance is declining rapidly for working folks in the bottom 60% of income to improvements in big health plans’ medical loss ratios, and then notes that these same plans appear to be advocating universal insurance.
While United Health CEO Bill McGuire et al are talking, governments are doing something about universal coverage. Massachusetts’ recent move to force universal coverage may have a few problems, but Leif Wellington Haase believes the good far outweighs the bad. Lief points out that other states, notably Maine and Illinois (as well as Tennessee) have all adopted legislation designed to increase health insurance coverage.
David Williams’ insightful entry makes the case that guaranteed issue is not anti-competitive at all, as it inspires and enables entrepreneurial activity, the basis for capitalism and the free market. A nod and a wink to David for expanding the discussion beyond the single dimension to recognize that health care, and where you get it, has a direct and dramatic influence on economic activity.
Dmitriy Kruglyak’s contribution lays out his thinking on market failure and insurance failure, and calls for transparency, appropriate risk pooling, and mandating open access networks.
Dr. Roy Poses associates the market domination of the big health plans with executive compensation, and makes the trenchant observation that if UnitedHealthGroup’s mission is in part to make health care affordable, it would make sense not to pay CEO Bill McGuire over a billion dollars. Roy’s post makes for a great segue to…
The incentives of publicly-traded for-profit health plans are contrasted with those of publicly-funded not-for-profit health plans by Jonathan Cohn. Jonathan notes that although Aetna’s profits were up 3%, Wall Street hammered its stock because the health plan was paying more for its members health care than it was the previous quarter. He notes the very real conflict between a for-profit health plan’s need to drive shareholder wealth and the public good of providing health care.
Carol Kirshner at Driving in Traffic has entered into the consumerism debate, positing that like it or not consumer-directed health care is coming, and suggesting that all stakeholders start thinking about how to deal with her new reality.
I spent a bit of keyboard time pointing out that (among the myriad reasons) consumerism will not solve the health care cost problem is the fact that most health care spending is by people who spend way more than their deductible and thus have no incentive to watch their pennies.
Trapier Michael’s entry also focuses on consumerism and its downstream effects; while noting that consumerism will not solve the health care cost/coverage conundrum, Trapper actually agrees with Matthew Holt (!) and is encouraged by consumerism’s potential to encourage hospital pricing transparency and new health care delivery options.
The Health Insurance Marketplace Modernization Act (also known as the AHP bill) has raised Graham Walker’s ire; the future physician is irate at the bill’s elimination of state mandates for preventive care. (I’ve taken issue with a basis for and potential consequency of the Act; It assumes there exists a number of competitive markets for health insurance and that this bill will enhance that current market condition; and the Act will likely increase the number of uninsured due to adverse selection and risk underwriting.)
Finally, no HWR Politics Policy and Economics chapter would be complete without a post on Part D. This edition’s entry is from Henry Stern, who contrasts statements about Part D subscribers’ satisfaction rates with the observation that most of the eligibles have not signed up for the drug coverage. Henry also puzzles over AARP’s apparent change of heart re the Feds negotiating with big pharma…
Business of Healthcare
Thanks to Rita Schwab for bringing us back to day to day matters with her post on “telework” in health care. Rita has done the research and lays out a strong case for enabling/expanding telecommuting in health care organizations.
Jason Shafrin, one of my favorite health care economists, explains why he believes reducing FDA restrictions on and the complexities of the drug development and approval process will not reduce consumers’ costs. Jason makes the point that drug pricing is based not on cost but on maximizing profits by leveraging consumer demand.
And boy is big pharma good at leveraging demand. To illustrate, the winner of the most esoteric award for this week’s edition goes to Martin Andersen for his post contrasting the marketing spin around drug Zyprexa with the reality of its very marginal effectiveness.
I’ve long been trumpeting the need for providers to base “outcomes” on the functionality of their patients. Jon Coppelman at Workers’ Comp Insider provides insights into what causes “disability“, noting that it’s up to physicians to get people back to work. (and I’d argue it’s up to payers to make sure they do…)
Posts that don’t fit anywhere in particular
Marcus Newberry’s perspective on the condition of good health has evolved over his years as a physician.
Kevin Keith’s Sufficient Scruples blog wades into the miasma that is the Terri Schiavo case (a decidedly unpleasant journey) to suggest that the continued screaming from all sides means we have learned little from this disaster.
And that’s all folks, until Jack Mason at HealthNex again upgrades your inbox with the eighth edition of Health Wonk Review.

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Joe Paduda is the principal of Health Strategy Associates



A national consulting firm specializing in managed care for workers’ compensation, group health and auto, and health care cost containment. We serve insurers, employers and health care providers.



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