Health Business Blog

Health care business consultant and policy expert David E. Williams share his views

Cap on Medicare drug benefits proposed

A week ago I predicted major pressure on the Medicare drug benefit by the 2006 election cycle. It may be coming sooner. According to Modern Healthcare:

Two Republican senators introduced a bill that would limit the cost of the Medicare prescription drug benefit to $395 billion over 10 years, the initial Congressional Budget Office estimate for 2004 to 2013…The bill, sponsored by Sens. Lindsey Graham (S.C.) and Jeff Sessions (Ala.), would establish annual spending caps and require that the benefit be reduced if its cost exceeded the annual limit.

Sam’s Club edging into health insurance market

Wal-Mart’s Sam’s Club unit and a UnitedHealth subsidiary will offer a discount program that covers a variety of health-care related services including dental, laser eye surgery, chiropractic care, acupuncture, weight loss, and fitness club membership.

Sam’s Club members pay $9 per month to access the program, which relies on aggregating customers to get discounts from providers. This program isn’t especially significant or innovative by itself, but I like the idea of a very consumer oriented company getting into the space.

Americans are terrifically savvy consumers of all kinds of goods and services. We recognize value and quality and punish retailers and suppliers that don’t deliver. But the healthcare system is structured in a way that doesn’t allow consumers to apply their shopping smarts. It’s time for that to change.

Health Savings Accounts (HSAs) and physician report cards are baby steps in that direction. Let’s hope retailers like Sam’s Club can accelerate the process.

Responses to air ambulance story

There are some interesting letters to the editor of the Wall Street Journal defending the use of air ambulances. (See Air ambulances: costly, dangerous, slow?)

They key points are:

  • ER physicians, scared of liability, are overreacting and sending even minor cases to specialty centers. (This echoes the comment from a Health business blog reader.)
  • When a rural community transports a patient a long distance in a ground ambulance, they put their own community at risk by losing their ambulance for most of the day
  • Once a patient is stabilized, sending them by fixed wing aircraft over a long distance is more comfortable than riding in a bumpy ambulance

However, a physician I know offered another argument against air ambulance use in trauma cases:

Due to noise in the helicopter and the close quarters, helicopter based paramedics are far less able to treat their patients en route than their colleagues in ground ambulances.

Double coverage for the old, none for the young

Senator John Kerry is championing a bill to encourage states to ensure universal healthcare coverage for youths up to age 21, according to the Boston Globe. The bill would amend Medicaid and offer extra funding to states that provide coverage. Republicans are offering strong opposition.

It’s curious that there is such support for universal, non-means tested coverage for older people (Medicare) while even means tested coverage for youth is controversial. Many Medicare recipients already have access to retiree health benefits from their employers, although that’s changing thanks to Medicare’s generosity. I’d rather see Medicare be means tested and Medicaid (for youth) not.

Maybe we should stop calling it “compliance”

As pay for performance plans for physicians become more popular, there is an increasing focus on the gap between what doctors “order” and what patients do. Patients following doctors’ orders are considered to be “compliant,” and those who don’t are “noncompliant.”

Terms like “orders” and “compliance” put too much burden on patients. (It reminds me of how utility monopolies use the term “ratepayers” rather than customers.)

A family physician cited in today’s Wall St. Journal has started to follow up with patients after their visits.

[She] learned to her dismay that many didn’t fill prescriptions or stopped taking medications because of side effects. She now puts all instructions for patients in writing, calls a few days after a visit to make sure they understood and checks with pharmacies to see if prescriptions have been filled.

She’s starting to address the real issues of poor physician/patient communication and follow up, although she’s doing it in a very labor intensive way rather than using a productivity tool such as RelayHealth.

Patients do need to take more responsibility for their own health and engage more effectively with their physicians, but let’s not call it compliance.