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Health Business Consultant David E. Williams looks at Medicare.

What’s to be done? I don’t have a comprehensive solution, but here are a couple of ideas that are too radical even to be considered right now, never mind put into place:

These “radical” ideas might put you to sleep because they are pretty tame compared to what I’d like to do. In fact, they seem anything but radical:

Means Testing: Make sure the person getting Medicare isn’t sitting on money they should be using to pay for their own health care. (This would be a great job for me… a few more weeks at the Physicians Neck and Back Clinic, and I’ll be able to hold old people upside down by their ankles and shake coins out)

Balance Billing: This means that hospitals charge what they wish with the stipulation that they must charge all patients the same. They are allowed to bill for the balance. That is, they can charge Medicare patients more than what Medicare will reimburse and bill them for it. I didn’t realize this, but THIS IS A HUGE CONTROVERSY…. because what a terrible thing to present someone with a bill for a service provided.
In some states, “balance billing” is synonymous with fraud:

The Medicare Balance Billing Program works to protect Medicare beneficiaries from being billed by health care practitioners for amounts beyond those approved by Medicare. The program investigates complaints and takes action against those practitioners who violate the law.

Get the popcorn.

This week, conservatives and liberals will face off on a question that has divided the Senate—and united the House:

* Should Medicare slash the fees that it pays physicians, across the board, by more than 10 percent?
* Or should it try to save money by trimming the subsidy that it now shells out to private insurers who offer Medicare Advantage? (Medicare pays private insurers 13 to 17 percent more than it would lay out if the government program cared for seniors directly. In theory, patients receive extra benefits that equal the bonus, though skeptics say insurers are simply pocketing extra profits. )

The battle began, in earnest, on Tuesday, June 24, when the House voted 355-59 to block a 10.6 percent pay cut for physicians which was scheduled to kick in on July 1.

In a stunning bi-partisan vote, the House decided to raise the money Medicare needs another way—by ending the private fee-for-service version of Medicare Advantage by 2011. (For Medicare, this is the most expensive version of Medicare Advantage: it costs the program 17 percent more than traditional Medicare, and as I wrote in December, insurers are not providing the quality of care that the Medicare Payment Advisory Commission (MedPac) expected. According to the Washington Post, the legislation could result in $14 billion less for insurers over five years.

Seems like a pretty good solution. Trim the fat… but

President Bush has already said that he will veto any bill that touches the insurers’ subsidy. With that in mind, liberals and conservatives in the Senate Finance Committee didn’t even wait for a House vote: they worked out a bi-partisan compromise that would freeze 2009 physicians’ payments and make no changes to Medicare Advantage.

Someone elegantly framed the debate as being between insurance companies and an angry coalition of seniors and their doctors. This should be a cool little skirmish, but the bigger battle is between seniors and today’s children.
The story behind all this is that Medicare is going broke and people are looking for ways to fix it without pissing off masses of constituents. The insurer’s subsidy seems like the least protected meat and that will probably go first. The story behind THAT is that the default fix turns out to be covert rationing. Make the system so full of mysterious bottlenecks and shortages that seniors won’t even be able to put the problem into words, much less punish the engineers that invented it. Every so often, a vote like the one in the house will shine a bright light on one small part of the mystery and send everyone running for cover, as they are now.
Dr. Rich says, “It turns out that this incomprehensible physician reimbursement system was set on its current path by one simple desire: to force doctors to covertly ration healthcare.”
he goes on to say:

This is all to say that the real issue is not so much with the government or with the private insurers. Whatever travesties these entities perpetrate simply follows from the job we’ve all given them, which is, to ration our healthcare covertly. Covert rationing is rationing by whatever means you can get away with, and so utterly requires head fakes, misdirection, systematized inefficiencies, complexity, delusion (of self and others) and flat out lies. These things simply cannot be accomplished in a system characterized by transparency and smooth efficiency.

If he is right, then we are witnessing a grand experiment to see if a free society can fool itself into saving money on health care.

Certainly, we all should contact our representatives, but I’m not sure what to say when I do.

NPR : Alan Greenspan interviewed by Terry Gross. It is worth a listen.

He has this to say about entitlements:

The real problem is not now, it is our utter lack of attention or failure to even want to confront the very substantial problems for financing Medicare especially in the years ahead and I must regrettably say that is true both for Republicans and Democrats. I’m listening to the debates amongst those who are seeking the presidency and nobody is recognizing what every technician has been telling all of the politicians that this issue has got to be addressed. If we don’t its going to create very serious fiscal problems for the country. It’s not the current data that is so critical. It is, basically, the failure to address the future.

He goes on to state that there is no way to solve the fiscal problems only by raising taxes and that services will have to be cut and if we are going to do that it is important that we communicate that fact immediately to the retirees making plans based on expected support from Medicare. He predicts that upper income groups will find themselves paying 100% of their medical costs.

From Wall Street Journal: “in an effort to help consumers compare the price and quality of health care, the Bush administration is posting how much Medicare pays hospitals for 30 common procedures such as heart operations and hip and knee replacements”

but:

“Medicare generally pays a flat rate to hospitals within geographic areas, and it’s unclear how the new information will help individuals navigate the complex hospital payment systems.”

Still, it’s great to have the information, the direct link to which is here. It is in the form of a 1.3 Megabyte Excel file. I see some possibility for mash-ups with Google Maps.

The CMS site is a rich source of information about the financial scam we are perpetrating on our kids if you can stomach it.

I was moved by the Engines of our Ingenuity piece I heard this morning: Shaping Death

And death has, in part, grown wild through the very tools with which medical science tries to domesticate it: an irony that would not be lost on Hamlet’s creator.