So, what does it all cost? Part One

Medical billing in the United States is, to put it charitably, a mess. So, although this surgery was two months + ago, and you'd think all the bills would be in by now, they're not, so we're going to have to take this in stages. Here's what we have so far:

According to Blue Cross's Statements of Benefits, providers, hospitals, therapists and pharmacies have "charged" a total of $122,601.44. (This is not the final total. I don't have all the bills yet.) This is what we may call the "list price." No one knows where this number comes from, including the people providing it. The hospital bill in particular ($112,317.60) is a complete fantasy. Hospitals themselves don't know what their services "cost," nor is this important to them (or anyone else). The "list price" is paid by those of the uninsured who do not file in bankruptcy. Almost no one actually pays this price.

Of this total amount so far, Blue Cross disallowed $70,686.35 and paid $49,009.51, leaving the net due, again, so far, at $4,180.11. (My numbers might be off $20 or so, I'm numerically challenged.) Of this I have paid, so far, $1,261.50. Two bills represented by the Blue Cross information forms, the bill from the hospital and the bill for the walker, have not yet arrived.

I am saying "so far" because I am not convinced that all the bills have yet arrived. In particular, I have a bill from the surgeon, but the price is so low that I'm certain that this is not the "real" bill.

A number of thoughts occur me here. First, there is the never-never-land quality of all these numbers. These prices are not arrived at in the same way that cars, say, are priced. Cars are priced, roughly, by calculating the cost of manufacture and adding to that the cost of transport and the cost of selling, including dealer costs, plus profit in some measure to all concerned.

Human services cannot be "priced out" in this fashion. What does it "cost" a surgeon to operate? Well, doesn't he or she amortize all those years of training and study, the cost of maintaining an office, and add to that whatever he or she thinks the market will bear? That's certainly how I bill my time. Hospital costs are even more complex, because, as a result of a number of factors, a lot of people who use hospitals pay nothing, or the government pays very little for them, and the rest of the costs of operation must be spread among the rest of us. This is, of course, a hidden tax.

It is not my understanding that hospitals in this country are gold mines, generating huge profits. Rather the contrary. Doctors are not getting rich either, not any more.

More details on health care reform. Sort of

From an article in the NYTimes:

• Mr. Obama would, for example, require drug companies to give bigger discounts, or rebates, to Medicaid, the health program for low-income people.

  Drug makers now must provide Medicaid with a discount equal to at least 15.1 percent of the average manufacturer price for a brand-name product. Mr. Obama wants to require discounts of at least 22.1 percent. Pharmaceutical companies have resisted such proposals in the past. (No. Surely not.)

• Mr. Obama said he would save $176 billion over 10 years by cutting Medicare payments to health insurance companies that provide comprehensive care to more than 10 million of the 44 million Medicare beneficiaries.

  Medicare pays private insurers an average of 14 percent more than it would cost to care for the same people in the traditional fee-for-service Medicare program. “It’s time to stop this waste,” the White House said.

  Karen M. Ignagni, president of America’s Health Insurance Plans, a trade group, denounced the proposal. (Another surprise.)

• The president also proposed cutting Medicare payments to hospitals that re-admit a large proportion of patients within 30 days after they are discharged. Such re-admissions sometimes indicate that hospitals provided poor care or did not properly coordinate care.

  Under the proposal, hospitals would receive “bundled payments” that cover not only their own services, but also any care provided by nursing homes and home health agencies in the month after patients left the hospital. (What? No one's objecting?)

• Mr. Obama also proposed squeezing $37 billion out of the payments to home health agencies over the next decade.

  William A. Dombi, vice president of the National Association for Home Care and Hospice, a trade group, said this proposal would directly affect frail, sick older people.

  “Patients would lose access to care very quickly,” Mr. Dombi said. “Over 70 percent of all home health agencies would be operating in the red.” (Yet another predictable response.)

• Doctors praised one aspect of Mr. Obama’s budget. He assumes that Congress will protect doctors from cuts in Medicare payments scheduled to occur under current law — cuts of 21 percent in 2010 and about 5 percent in each of the next few years.

  “We are very pleased,” said Dr. Nancy H. Nielsen, president of the American Medical Association. “All previous budgets assumed cuts in doctor payments.” (Predictable yet again)

Everyone so far is running true to form, protecting their particular special interest. We can expect to see a great deal more of this, of course. It's this kind of thing that has always defeated health care reform.

But I'm wondering if it's wise to proceed thus, in piecemeal fashion. Don't we need an overall plan which could be convincingly sold to all players, where everyone could see a benefit to the whole, not just a loss to themselves?

New budget

The Obama administration released a new proposed budget today which includes a $634 billion fund for health care reform. See the article in the Washington Post.

I'm less interested in where this money is coming from (increased taxes on high earners, reduced payments to insurers, hospitals, doctors and drug manufacturers) than in just exactly what it will be spent on. Since the United States already spends far more per capita on health care than any other nation (and gets less for it) I'm wondering why we need to spend even more, and on what exactly.

The Post says: "By first identifying a large pot of money to underwrite health-care reform -- before laying out a proposal on who would be covered or how -- Obama hopes to draw Congress to the bargaining table to tackle the details of a comprehensive plan. The strategy is largely intended to avoid the mistakes of the Clinton administration, which crafted an extensive proposal in secret for many months before delivering the finished product to lawmakers, who quickly rejected it.

" 'We aim to get to universal coverage,' administration budget aide Keith Fontenot told health-care activists last night. Obama is 'open to any ideas people want to put forward. He wants to work openly with the Congress in a very inclusive process.'

"Virtually every major player in the health-care sector will find something to object to in Obama's plan, an intentional decision made in the hope that 'a little bit of pain' will be offset by the appeal of insuring millions more people, said one White House adviser."

This sounds shrewd, if somewhat cagey. (Maybe those two are the same.)

Here's a little more information, again from the Post: "If the budget is approved by Congress, drug companies will be required to increase the rebate they pay on medications sold to Medicaid patients from 15 percent to 21 percent. The proposal, which would raise $19.5 billion over 10 years, is likely to spark strong opposition from the industry, which has argued that the current rebate cuts into profits.

"Wealthy senior citizens would also be asked to pay higher premiums for Medicare drug coverage, similar to the higher premiums they now pay for physician visits, according to the Obama blueprint.

"The budget figures also represent significant shifts in how the United States will pay for medical care.

"For example, experts have identified hospital readmissions -- especially for elderly patients -- as a sign of poor care and unnecessary expense. About 18 percent of Medicare patients are readmitted to the hospital within 30 days of an original visit. The new approach would establish flat fees for the first hospitalization and 30 days of follow-up, sometimes done by separate facilities. Hospitals or clinics with high readmission rates could be paid less."

It's hard to tell from the article whether reforms such as that described in the last paragraph are actually in the new budget, or are just ideas that someone is tossing around. What is clear is that the budget identifies the proposed sources of the money much more specifically than its destination.

Perhaps spending more money isn't such a bad idea, given that I'm hearing that many of the health care systems in Europe are currently in financial trouble, or will be very soon. We may all, including the Europeans, have to spend more money on health care than we are currently.

Health care reform? Let's hope.

For that same reason, we must also address the crushing cost of health care.

This is a cost that now causes a bankruptcy in America every thirty seconds. By the end of the year, it could cause 1.5 million Americans to lose their homes. In the last eight years, premiums have grown four times faster than wages. And in each of these years, one million more Americans have lost their health insurance. It is one of the major reasons why small businesses close their doors and corporations ship jobs overseas. And it's one of the largest and fastest-growing parts of our budget.

Given these facts, we can no longer afford to put health care reform on hold.

Already, we have done more to advance the cause of health care reform in the last thirty days than we have in the last decade. When it was days old, this Congress passed a law to provide and protect health insurance for eleven million American children whose parents work full-time. Our recovery plan will invest in electronic health records and new technology that will reduce errors, bring down costs, ensure privacy, and save lives. It will launch a new effort to conquer a disease that has touched the life of nearly every American by seeking a cure for cancer in our time. And it makes the largest investment ever in preventive care, because that is one of the best ways to keep our people healthy and our costs under control.

This budget builds on these reforms. It includes an historic commitment to comprehensive health care reform -- a down-payment on the principle that we must have quality, affordable health care for every American. It's a commitment that's paid for in part by efficiencies in our system that are long overdue. And it's a step we must take if we hope to bring down our deficit in the years to come.

Now, there will be many different opinions and ideas about how to achieve reform, and that is why I'm bringing together businesses and workers, doctors and health care providers, Democrats and Republicans to begin work on this issue next week.

I suffer no illusions that this will be an easy process. It will be hard. But I also know that nearly a century after Teddy Roosevelt first called for reform, the cost of our health care has weighed down our economy and the conscience of our nation long enough. So let there be no doubt: health care reform cannot wait, it must not wait, and it will not wait another year.

- President Obama, last night, to Congress

Kind of light on specifics, but this was an inspirational speech, not a particularly substantive one.

From this I derive the following:

1. [The new budget, which no one has seen yet] includes an historic commitment to comprehensive health care reform -- a down-payment on the principle that we must have quality, affordable health care for every American. "Commitment." This would be what? It sounds like it's somewhat short of actually taking action on the problem. On the other hand "we must have quality, affordable health care for every American" is certainly going in the right direction.
2. Our recovery plan will invest in electronic health records and new technology that will reduce errors, bring down costs, ensure privacy, and save lives. I used to oppose electronic health records, but after filling out three different "history" forms for my recent surgery (one for the general practitioner, one for the surgeon and one for the hospital), on inconsistent forms, none of which, I am convinced, were read by anybody, I've changed my mind. Everyone knows that the least reliable way to collect health information is self-reporting. People lie, to be blunt. A coherent, accessible actual history would be much more useful, and in all probability save lives. Not to mention money. Ask yourself. Do you want the guy who's going to cut into you, not to mention the guy who's going to put you to "sleep" under heavy sedation, to have the real facts, such as we can know them, about your body and your health history?
   
3. It's a commitment that's paid for in part by efficiencies in our system that are long overdue. You think we pay too much for health care? I do. Review previous posts. Why can France produce superior results for half of what we spend per capita? Hum? Can we flush out inefficiencies? Time will tell.
4. Now, there will be many different opinions and ideas about how to achieve reform, and that is why I'm bringing together businesses and workers, doctors and health care providers, Democrats and Republicans to begin work on this issue next week. The allusion to radically differing ideas is well taken. (And the Republicans, as well as a lot of people who are apparently profiting by the current "system," so far as I can tell, do not want reform at all.) That's the gloomy statement. The optimistic statement is next week.
5. So let there be no doubt: health care reform cannot wait, it must not wait, and it will not wait another year. That's the best part. The idea that we have to fix this not some vague time in the future, but now.
   

What happens if I get well too soon?

I went to my first meeting with "Steve," my physical therapist, yesterday.

Of course I've been getting PT the whole time, first at home, and then, last week, an "evaluation" by the supervisor at the local hospital's therapy shop. All these people told me that I was getting well at a surprisingly fast rate, measured by the range of motion in the new knee. I can walk up and down stairs alternating legs (unlike my previous one-step-at-a-time pace like a two-year-old), I can use the stationery bicycle. And so forth.

Steve seemed disconcerted by all this. I shouldn't "overdo," according to him. All I can think is that he's assuming that my rapid progress is the result of pushing too hard on the exercises. Actually, I'm just doing what I was told, and I'm at something of a loss to explain the speed of recovery.

On the other hand, I'm not inclined to look this particular gift horse in the mouth.

As for being painful, rehab is not as yet living up to its ferociously bad advance billing. Steve does a nice massage, but neither Steve nor the exercises are particularly painful. For those of you who haven't had this surgery, the exercises are like yoga, where you're stretching to loosen up a joint. You get to the point of a stretch, but if it hurts you're going too far.

Everyone said to me, "Take the pain pills, do the exercises," and I'm on Vicodin during the days (having downshifted from Percocet) and I'm doing the exercises.

I found Steve rather discouraging on the whole. I need to remember that he can say whatever he wants, but as a practical matter he can't really retard my recovery (even if I'm sensing that, rather illogically, he'd like to). Perhaps he's just feeling unnecessary.

My magpie gets loose in Pescadero

My younger daughter says that I "shop like a magpie," by which she means that when in a store I am quite apt to say, Oh look that thing over there glitters, let's go see!

After that I am quite liable to buy whatever it is.

In Pescadero there is a wonderful gift shop almost next to the bar. The shop is called "Made in Pescadero," and has lovely handmade furniture, wood-kiln-fired pottery and artist-made jewelry. I'm no longer in the furniture-acquisition business (rather, I need to get rid of some), but jewelry and pottery are different.

Besides, jewelry glitters.

The first week we went over there I was still on crutches, but not so disabled as to be insensitive to the attractions of the Good Stuff. Last weekend I was carrying (but not using) a cane, and even more able to shop.

It's surprising how much buying things cheers me up.

Obama signs kids' health insurance bill

See the story from the AP.

"The bill calls for spending an additional $32.8 billion on the State Children's Health Insurance Program, known as SCHIP, which now enrolls an estimated 7 million children. Lawmakers generated that revenue by raising the federal tobacco tax."

The bill will add 4 million additional children to SCHIP.

The Republicans, of course, opposed it. "[T]hey argued that Democrats were taking the program beyond its original intent and were encouraging states to cover middle-class families who otherwise could get private insurance.

" 'This debate is about, do we want a children's health insurance program that covers every child in America with state and federal dollars regardless of their ability to pay?' said Rep. Joe Barton, R-Texas. 'Do we want to freeze out the private sector for health insurance?' "

Oh dear, the poor health insurance companies! Doesn't this make you want to cry? And who are these "middle-class families who otherwise could get private insurance?" What planet is Mr. Barton living on?

Oh I know. He's living on Planet The-Federal-Government-Pays-For-All-My-Health-Care, just like all the other members of congress. (Do we want a congressperson's health insurance program that covers every member of congress with federal dollars regardless of their ability to pay? Of course we do.)

" 'We fulfill one of the highest responsibilities that we have, to ensure the health and well-being of our nation's children,' the president said before a cheering audience of families, lawmakers and interest groups. 'Providing coverage to 11 million children is a downpayment on my commitment to cover every single American.' "

A small downpayment. But any progress is progress.