If Andy Rooney were covering the current healthcare debate, he might say, "Doncha hate it when people take your campaign promises seriously and expect you to take them seriously, too? Also, doncha hate it even more when people wonder why you wanted $19 billion for healthcare computerization, and yet you refuse to put your own legislation online?"
Yes, those are good questions, going right to the heart of what it is that the Democrats are tying to do with their health care bill. Are they trying to bring openness and transparency to the process, or are they trying to keep it all as secret as possible? And if they want to keep it under wraps, we might ask, "Why?"
Those questions come to mind as I read of a new poll from Rasmussen Reports, headlined, "83% Say Congress Should Post Bills Online For All To Read Before Voting On Them." Yup, an overwhelming 83 percent of Americans think that Congress should post legislation (including, of course, the healthcare bill) online well before voting on it. Indeed, a thumping 64 percent of Americans think that legislation should be online for two weeks before it gets voted on.
That full-disclosure public sentiment is certainly in keeping with the "information wants to be free" ethos of the Information Age, which started to wash over politics, in the form of C-SPAN, debuting way back in 1979. And the Internet has opened up new vistas for disclosure and transparency; Newt Gingrich is a Transparency Hero for driving the process of putting most House proceedings immediately online, via the Thomas system, which the Senate quickly picked up on. But that was 14 years ago, and little has happened since to advance the notion of "sunshine" on Capitol Hill.
Yet it seemed like just yesterday that Barack Obama pledged that all his presidential health care deliberations would be put on C-SPAN. In fact, it was barely more than a year ago--he made that pledge, most recently, on August 21, 2008. He told an audience in Chester, VA: "I'm going to have all the negotiations around a big table. We'll have doctors and nurses and hospital administrators. Insurance companies, drug companies -- they'll get a seat at the table, they just won't be able to buy every chair. But what we will do is, we'll have the negotiations televised on C-SPAN, so that people can see who is making arguments on behalf of their constituents, and who are making arguments on behalf of the drug companies or the insurance companies. And so, that approach, I think is what is going to allow people to stay involved in this process."
That seems clear enough. But of course, it didn't happen.
And it was just last week that Sen. Jim Bunning (R-KY), offered an amendment to the Finance Committee bill calling for, among other things, a three-day period in which the legislation could be posted online. But Bunning's amendment was voted down. Over on the House side, Republicans have a similar idea, but of course, they aren't likely to get very far with the Democratic majority.
Admittedly, both parties have been guilty of trying to keep the "sausage-making" process as veiled as possible.
But with every year, the argument for secrecy attenuates, as a) better information technology makes it easier to fully disclose, and b) that same better info tech makes it virtually inevitably that the secrets will be disclosed anyway.
And secretiveness is doubly ironic for the current Democrats, since not only did their leader, Obama, promise to let everything hang out on TV, but the Obamacare forces have placed great stock on the idea that information technology will help improve health care.
Earlier this year, the "stimulus package," a.k.a. American Recovery and Reinvestment Act, allocated $19 billion for health information technology. There are plenty of good arguments on behalf of health IT (some made at a conference held on Tuesday morning at the US Chamber of Commerce, more on that soon), but one could be forgiven for thinking that the first thing that should be digitalized and "transparent-ized" would be the authorizing legislation of Obamacare. But not so fast.
No doubt the Democrats think that they are playing it smart by doing it the old-fashioned way--behind closed doors. But it's entirely possible that they are outsmarting themselves, because they are in the process of producing a product that the American don't seem to like. This morning I went to a healthcare discussion hosted by Harvard's Shorenstein Center; more soon on that as well. But suffice it to say, for now, that leading academic experts, including Kathleen Hall Jamieson and Robert Blendon were more than a little bearish about the current legislation.
Hmm. Big Democratic majorities back then, high hopes, a bill hatched the traditional way, and then... boom! it blew up when the public got wise to it. And that was before the Net, before Rush Limbaugh and Glenn Beck.
No wonder Politico front-paged a story mulling over who would succeed Harry Reid as Democratic Leader if is defeated for re-election next year.
Healthcare spending could be "the next stage in the evolution of advanced economies." That's a curve-bending, paradigm-shifting opinion from Michael Lind, who once again challenges the conventional wisdom. As we all know, Americans have been told--lectured is probably a better word to use--for decades now that healthcare spending is a problem, not a solution.
But what if that conventional wisdom was wrong? What if the same healthcare that improves and lengthens our lives could also improve our economy? Already is, in fact! Better health and better wealth--a win-win! That's been the Serious Medicine Strategy argument all along, but it's been distinctly in the minority.
Writing in The Financial Times, Lind makes some bold claims: For the real jobs of the future, look to healthcare, education and local public services--particularly healthcare. According to the Bureau of Labor Statistics, healthcare accounts for seven out of the 20 fastest-growing occupations, more than any other category. Home health aides and personal and home-care aides are found both among the fastest-growing job categories and among the occupations with the largest overall job openings in the years ahead.
While employment in manufacturing is declining overall, employment in pharmaceutical and medicine manufacturing in the US is expected to expand. Better yet, the growing healthcare sector is creating jobs for workers at all educational levels, from the highest--physicians and surgeons who need professional degrees--to the lowest--health aides who need only high school qualifications plus brief on-the-job training. The medical-industrial complex is unique among industries in combining the potential for greater research and development, more manufacturing and a growing number of labour-intensive jobs that cannot be offshored.
Lind, of course, is one of the leading policy thinkers in America today. For the better part of two decades, his work has ranged across a wide array of topics, international as well as domestic, but his impact on economic policy has perhaps been his greatest contribution to the current debate. Lind's signature has always been his ability has been to summon up historical parallels, reminding us that more often than not, we have confronted analogous problems in the past. Yes, technology changes, but human nature doesn't change much, and national interest is a constant.
Thus his many books--eight, by my count--have often encouraged Americans to look to their own national history for clues about future national solutions. Indeed, thanks in large part to Lind's efforts, the economic policy ideas of Alexander Hamilton, Henry Clay, and Abraham Lincoln, to name just three great historical figures, have enjoyed a substantial re-evaluation and much-justified revival. At a time when Americans are understandably dissatisfied with the performance of the economy, his work product stands as proof that fresh and valuable thinking can come from the past, as well as the present.
But Lind is not just a historian. He is actively engaged in the great debates of the moment. And so it is particularly interesting that Lind sees healthcare as an economic driver. That is, healthcare is an asset, not a liability. Indeed, Lind's views are provocative because his positive view of healthcare puts him at odds with the prevailing policy orthodoxy, which holds that health care is an expense in urgent need of being curbed.
This article was first published at Fox News' Fox Forum.
In the first part of this two-part piece, I noted that the hot issue-within-an-issue for Washington healthcare wonks is “bending the curve” on healthcare costs--that is, reducing future increases.
Even Barack Obama is talking the “bend” talk. In an interview with The Washington Post in July, the President used the “b-word” no less than 11 times. In this particular passage, he said that he wants to bend the cost curve, not only for government expenditures, but also for private-sector expenditures. “The problem we have in this whole debate is that bending the cost curve, curbing health care inflation, is harder to measure in part because it doesn't just involve government outlays; it also involves what's happening in the private sector.”
But of course, talk of “bending curves” is simply a fancy way of saying “cuts.” As Howard Gleckman observed earlier this year in Business Week, “When it comes to Medicare, ‘bending the curve’ means rationing care.” Got that? And since Obama mentioned private-sector expenditures as well as government expenditures, we can assume that he wants to extend rationing to everyone.
But as I also noted, head-on attempts at “bending the curve” are doomed to failure, at least in a small “d” democratic society. Why? Because poll after poll shows that the American people think they should be getting more treatment, not less. And they vote accordingly, which is why Obamacare is in so much trouble.
So what’s the answer? Are we doomed to ever-escalating healthcare costs because people want more treatment? No. We are so “doomed” only if we see health care and medicine as static and unchanging. But if, instead, we see health care and medicine as dynamic, if we see that the variables of health and medicine can be changed--as when, for example, a new or improved treatment comes along, or even a cure--then it’s possible to see hope for outcomes that are not only cheaper, but better.
And that hope is well-grounded in medical history.
We might consider, to start, the humble headache--although, of course, for those suffering from a migraine, there’s nothing humble about it. In the dark past, and yet not so long ago, some extraordinarily awful “cures” have been attempted; for example, there was trepanation--drilling a hole in one’s head to let the bad stuff out. Needless to say, trepanation was among the many “cures” that didn’t cure very well.
But then in the late 19th century came aspirin. Aspirin was the wonder drug of its day, and to many pain sufferers, it still is. And yet while aspirin was plenty expensive to research and develop in its the 1800s, today it is off-patent and mass-produced, so it’s cheap and abundant.
So what’s the lesson here? The lesson is not to “bend the curve” on ineffective methods for curing headaches--finding cheaper ways to drill holes in heads--but instead, to find effective methods for curing headaches. Effective is better than ineffective. Effective means bending the curve the right way. And over time, the curves of those cures will be “bent upward,” even as new varieties are introduced to the market, so that every niche need is properly serviced.
The same model applies, as well, to historically more lethal diseases. Thanks to the dynamism of science, we didn’t just bend the curve on smallpox, we flattened the curve on smallpox. A malady that was killing millions of people a year into the 1960s, smallpox was officially declared eradicated by the World Health Organization back in 1979. As in, no more. Instead of humans being kaput because of smallpox, the smallpox virus is kaput because of humans. Yet if we hadn’t eradicated smallpox, today we’d still be talking about “bending the curve” on smallpox, which would mean, for example, figuring out ways to squeeze savings from smallpox hospitals. (And of course, we would also be struggling to calculate the economic harm done by the loss of those who were killed and disabled by the disease, although health care bean-counters rarely worry about questions of lost economic output; they focus only on direct healthcare outlays.)
Now let’s take a more current example, a disease wrecking lives today: amyotrophic lateral sclerosis (ALS), also known as Lou Gehrig’s Disease. Every year, 5,000 new cases of ALS are diagnosed; when the diagnosis is made, treatment can easily cost $200,000 a year. Most patients live two to five years after diagnosis, which means that a single case of ALS could easily cost hundreds of thousands of dollars, and on into the millions. So how to bend that curve? Only the hardhearted would say of ALS victims, “Well, they’re going to die soon anyway, so let’s cut back and let them go quickly.” The rest of us would say, “We need to do what we can for these unfortunate people.” And then we would add, “But of course, it would really be great if we could figure out a cure!” Indeed, the best and also cheapest way to deal with ALS is to eliminate ALS, so that it goes the way of smallpox.
That makes sense, doesn’t it? As Robert Frost observed, “The best way out is always through.”
Just on Monday, ALS sufferers, and their families, received some good news. The Food and Drug Administration approved for clinical trial a new treatment produced by Neuralstem Inc., based in Rockville, MD. There’s no way to know how these trials will turn out, but now there’s hope--hope founded in the vast success that Serious Medicine has enjoyed over the centuries.
If we did it with headaches, and we did it with smallpox, then we can eventually do it with ALS--if we keep at it.
The same Robert Frostian best-way-out-is-through logic also applies to medical devices and techniques. Let’s take another example of a medical device that’s so embedded in our thinking that we have forgotten how hard it was to develop: eyeglasses. The idea of using corrective lenses goes back more than a thousand years, to the 9th century; the first wearable eyeglass is thought to date from the 13th century. Yet even rich people were poor back in those days, and so the work of inventors and craftsmen over all those centuries represented, in relative terms, an enormous investment. But thanks to their accumulated good work, eyeglasses today are cheap, and so are contact lenses.
And now we have other eyesight-improving procedures, such as LASIK. As the spelled-out name--laser-assisted in situ keratomileusis--suggests, LASIK is not easy. Or at least it wasn’t easy to invent and to refine. But now that the procedure has been invented and refined, it has become easy--at least easy to pay for. Indeed, it’s now possible to shop for LASIK on eBay. Now that’s bending the curve!
I could cite other examples, too, such as minimally invasive, or laparoscopic, surgery, which is in the process of cost-crashing more and more kinds of surgical procedures.
So this is how we “bend the curve” in a politically and ethically acceptable fashion: We research and develop new approaches, which are faster, cheaper, and best of all, better. The only kind of healthcare cost control that will work over the long run is healthcare improvement. That is to say, Serious Medicine.
Medical history tells us that this is so, and common sense underscores that point as well. So why are the healthcare policy elites talking about “rationing” when they could be talking about improved health and lower costs?
Are you curious about that? Good! Then why not ask your elected official exactly that question at the next town meeting?
UPDATE: News out of Thailand tells of a huge possible breakthrough--a vaccine against AIDS. The vaccine effort, financed by the US government, appears to thwart transmission of the disease in Thai trials. If this finding bears out, it will be huge, knocking out a disease that has killed tens of millions. And that will be another example of cost-curve-breaking, as opposed to just a cost-curve-bending. We need more of those.
Robert Samuelson, the eminently sober and serious-minded columnist for The Washington Post, published a slashing attack on Obamacare this morning, under the headline, "The Health-Care Ego Trip."
Samuelson writes, "What's driving the great health debate of 2009 is not a popular clamor for universal insurance." Then he cites a Wall Street Journal poll showing a 41:39 plurality of Americans are opposed to Obamacare, although he does not cite a new Rasmussen poll showing that Americans oppose Obamacare by a 56:41 margin. So what's the explanation for the persistence of Obamacare advocates (and of Clintoncare advocates before them)? "The underlying driver," Samuelson declares, "is politicians' psychological quest for glory." He continues, quoting Montana's Max Baucus:
"My colleagues, this is our opportunity to make history," Chairman Max Baucus implored last week as the Senate Finance Committee opened consideration of his bill. Politicians, in their most self-important moments, see themselves as instruments of national destiny. They yearn to be remembered as the architects and agents of great social and economic transformations. They want to be at the signing ceremony; they want a pen.
Could it all be this simple? Is politics nothing but a wildly expensive subsidy program for the "ego-price-support" of politicos? The economist James M. Buchanan won the 1986 Nobel Prize in Economics for his "public choice" theory, which holds that politicians and other public officials are entrepreneurs of their own kind; they simply use public money to achieve their own private welfare-maximizing ends. (A quick drive through the Northwest DC demonstrates that plenty of people have lived by the old Beltway adage, "They came to do good, and ended up doing well.")
But Samuelson is making more of a psycho-political point, emphasizing the "greatness" incentive of politicians and policy entrepreneurs, not just their financial incentives. Samuelson is saying that healthcare advocates want the psychological high that comes from doing "great" deeds, even if, upon inspection, those deeds are not so great. And so the rest of us have been warned. Samuelson continues: Ordinary Americans are rightly suspicious of this exercise in collective ego gratification, which has gripped Obama and many of his congressional allies.
To be sure, it's not just healthcare reform that gets politicians giddy. The military also excels at gratifying political egoes. Nobody puts on pomp and circumstance like the brass, and only the Pentagon will honor favored patrons with the naming rights for ships and bases. Thus the opportunity to play civilian master and commander is tempting indeed; that's one reason why we have so many wars. And if we can't have a war, we can at least have the "moral equivalent of war," as Jimmy Carter put it in 1977, echoing William James.
The dilemma, of course, is that healthcare is important. We should encourage our politicians to take constructive steps to improve healthcare, to foster the production of medicine and cures, and to help all of us live long and healthy lives. Those are all wonderful goals, and if politicians get an ego-stroke for helping to achieve them, then in it's a win-win, for both the people and the political class.
But the problem is that it's not so clear that the current crop of political incumbents knows very much about improving health care, to say nothing of medicine and cures. Sure, they have plenty of ideas for spending money and "expanding coverage"--and the most ambitious of them seem possessed by the idea of universalizing coverage into a "single payer" plan--but they all seem preoccupied with health care as a means to an end, not as an end in itself. The means, in this case, is process, and yet the end is more important. The end is better and longer lives for people.
And that preoccupation with means suggests that politicos are easily sidetracked into political projects: If they are Democrats, they are easily seduced into building bureaucracy and protecting trial lawyers; if they are Republicans, they feel compelled to expand the free market, which seems to be defined, in practice, mostly as protecting private insurance companies. Which is to say, neither party seems very interested in actual medical cures. As argued here at Serious Medicine Strategy, if we had more cures, then it would be easy to make health care cheaper, even as it was being made more accessible to people.
It's said that if you are a hammer, the whole world looks like a nail. Or, per Samuelson, if you are a politician with a pen, the whole world looks like a piece of legislation upon which to affix your name. And if that legislation has little to do with actually improving the lives of Americans? If it doesn't actually make anyone healthier? Well, all that is secondary. The main thing is to sign the bill, make a speech, take credit--and hopefully get your name in the history books.
The baleful cycle of political glory-hounding will continue until the voters wise up. But in the meantime, we should at least try to stop politicians from making things worse.
How will President Obama and his healthcare team react to a medical miracle? And how will the Congressional Budget Office score it? If a blind person gets a sight-saving procedure, is that a worthy, even heroic expenditure? Or is it just a bigger medical cost?
These questions go right to the heart of the current debate over healthcare policy, because they remind us that "healthcare policy" is not an end in itself. Healthcare policy is a means to an end. The end is better health for Americans. Better health that Americans can feel, touch, and, in this case, see.
Sharron Kay Thornton, 60, from Smithdale, Miss., blinded by a skin condition, regained sight in one eye after doctors at the University of Miami Miller School of Medicine extracted a tooth (her eyetooth, actually), shaved it down and used it as a base for a plastic lens replacing her cornea.
It was the first time the procedure, modified osteo-odonto-keratoprosthesis, was performed in this country. The surgeon, Dr. Victor L. Perez, said it could help people with severely scarred corneas from chemical or combat injuries.
Now we might ask: How would the Congressional Budget Office "score" these research and medical expenditures that the Times reported on? What's the "fiscal impact" of the blind being able to see?
Should we "bend the curve" by telling Dr. Perez to slow down his efforts? I imagine that Dr. Perez would love to make his procedure cheaper and better and more available to all who need it, but the only way to do achieve such economies of scale is by expanding the procedure and repeating on many more patients, so that the cost of the underlying R&D for "modified osteo-odonto keratoprosthesis"--soon, we can imagine, in the spirit of LASIK, to be acronym-ed into, say, MOOK--is amortized over the widest possible number of beneficiaries, here in the US and around the world. And if this procedure could be spread around the world, it could be an attractive and profitable export, of a kind, for the US.
But we have to get there. And right now, the national policy trend is headed in the other direction.
It's a grim quip that doctors bury their mistakes. Well, it can also be said that bean-counters seek to bury their costs. Even if what looks like a cost to the government is a great gift to another human being.
But sometimes, bean-counters don't bury their costs, they merely blind them.
So back to my original questions: How will Obama and his healthcare team react to a medical miracle? And how will the CBO score it? Only one way to find out.
But my guess is that they will ignore everything in this Times article. Why? Because powerful leaders and experts in Washington DC do "healthcare policy." They don't fool, in any way, with "cures." Especially if those cures might cost more money.
Bloomberg News' Brian Faler writes a smart piece, "Budget Office Misses on Big Bills Cloud Health Debate," which bears examination in the current debate over health care dollar totals. As I wrote here last night, the Congressional Budget Office has great power in the healthcare debate, by virtue of its number production, even though nobody really knows what its numbers mean, or how accurate they are.
In 2003, as Bloomberg notes, CBO estimated that the new Medicare drug benefit would cost $518 billion. Three years later, CBO admitted that it had overestimated the cost by nearly a third--the real price tag was $382 billion.
The issue here isn't bad faith, it's competence at knowing the future, and the future isn't knowable. CBO might be making the best of an impossible situation, but if it's an impossible situation, then the best won't be very good.
And so what are the chances that CBO would ever be able to measure an innovation that "bent the curve" on health care in some way--as in, for example, actually curing a costly disease? CBO might be able to accurately measure the fiscal impact of a rationing scheme, but it probably couldn't, by its own admission, measure the fiscal impact of a breakthrough.
But let Bloomberg's Faler tell the tale his way: CBO’s projections matter because lawmakers are required to use them as they weigh various measures, including the plans to remake the U.S. health-care system. Yet the more sweeping the proposal, the more likely its estimates will miss the mark because on such legislation the agency has the least amount of data, CBO Director Doug Elmendorf said.
“When Congress is considering incremental changes to policies, and especially incremental changes that are similar to ones that have been made before, then there’s a history that we and other analysts can consult,” Elmendorf, 47, said in an interview. With “more dramatic or novel changes in policy, there’s no previous experience to refer to.”
As the nonpartisan agency reviews plans to carry out the most extensive overhaul of the medical-care system in more than four decades, “the range of uncertainty around our estimates of health-reform proposals is very large,” he said.
In other words, if the number-crunching is easy, if it follows a pattern we have seen before, we can do it, says Elmendorf. But if it's complicated and tricky--if it covers new territory--then we'll probably get it wrong, he seems to be saying. Indeed, that's exactly what Elmendorf is saying:
The cost estimates “often depend on projections of economic or political developments that are very hard to foresee,” said Elmendorf, an economist.
And on this score, Elmendorf's predecessor at CBO, Peter Orszag, now at the Office of Management and Budget, seems to agree:
Peter Orszag, the agency’s head until Obama named him director of the White House Office of Management and Budget, agreed that far-reaching legislation tests the limits of CBO projections.
“Any set of analysts, whether they’re at CBO or elsewhere, find it easier to assess marginal changes -- a little tweak here, a little tweak there -- within the bounds of historical experience,” he said in an interview. “It’s harder to evaluate and quantify things that transform systems.”
OK, so the past and current directors of CBO agree that CBO won't get it right if it's complicated.
So what, exactly, is CBO doing? The moral of this story seems clear enough: CBO will account for what it can account for, and it won't account for what it can't account for. Does that help?
The healthcare policy debate in Washington has taken on an extraordinary degree of abstraction, in which numbers--agreed-upon fictions--substitute for disagreeable reality. So as a tangible tonic, one might read this powerful articlein The New York Times, to get a sense of how the debate over health care--and related issues, such as immigration and our national commitment to a safety net--is, in painful fact, a matter of life and death.
But in the meantime, back in DC, the political debate revolves around "hitting the number." That is, delivering a healthcare bill that is "scored" by the Congressional Budget Office to cost less than a trillion dollars--or better yet, less than $800 billion--over ten years. Minimizing federal outlays is a great goal, of course, but the blunt reality is that nobody has any idea what any bill will actually cost over that ten years.
And the methodology used by the CBO has glaring omissions. As noted here at SMS on August 28, the CBO refuses, for example, to "score" savings from prevention. Nor can the CBO score for medical breakthroughs.
I have great respect for Doug Elmendorf, the director of CBO, and for the CBO overall. Over the years, CBO has admirably stood up to purely political attempts to pressure it to produce "rosy scenario" numbers"--including, most recently, pressure from the Obama White House.
But just because CBO is institutionally resolute does not automatically make CBO numerically accurate. As noted here at SMS this morning, the real changes in healthcare cost trends, if there are to be any, will come from new technology, not from the same old bean-counting.
But the lack of linkage to any observable reality has not slowed down anyone in Washington. Why? Because at least the CBO offers something resembling a "metric." CBO numbers might not actually be a metric, but at least they resemble a metric, and that's close enough, apparently, for government work.
And so, for relief from such Alice-in-Potomac-land thinking, we come to the observable reality down in Atlanta, where the entire metro area is home to more than five million folks.
Founded in 1892, Grady has been a linchpin of area health for more than a century; Grady estimates that it has trained, or helped train, a quarter of all the doctors in Georgia. Moreover, Grady boasts the only level I trauma center within 100 miles of metro Atlanta,which is to say there are times when even people who would never wish to set foot in a "community" hospital could find themselves--when they least expect it, and least want it--depending on Grady for their lives.
But of course, the bulk of Grady's clientele is poor--and a lot of them aren't citizens. And so we come to the "peg" for the Times story: Grady's attempt, driven by financial desperation, to close its kidney dialysis unit, which loses millions, mostly because of uncompensated care from the illegal, uninsured, and under-insured:
Hospital officials estimate that two-thirds of the outpatient clinic’s roughly 90 patients are illegal immigrants. They do not qualify for Medicare, which covers dialysis regardless of a patient’s age, and they are excluded in Georgia from Medicaid and other government insurance programs. Legal immigrants face a five-year waiting period before becoming eligible. That leaves Grady to absorb costs of up to $50,000 a year per dialysis patient, some of whom have availed themselves of the thrice-weekly treatments for years.
In further detailing the plight of Grady:
At Grady, about four in 10 patients are uninsured, and an additional 25 percent are insured by Medicaid, which reimburses at rates so low they often do not cover actual costs. As a result, the hospital lost $33.5 million last year, with the dialysis clinic accounting for about $2 million of that total, said Denise R. Williams, the hospital’s executive vice president.
Interestingly, there's no lack of Atlanta-wide civic engagement and generosity in the management of Grady. As the Times notes,
After years of fiscal desperation and management turmoil at Grady, Atlanta business leaders stepped in last year to force a restructuring, from a quasi-governmental authority to a nonprofit corporate board. In response, the Robert W. Woodruff Foundation pledged $200 million over four years to replace dilapidated beds and modernize computers. A $20 million gift from Bernie Marcus, a founder of Home Depot, is helping to update the emergency department, which provides regional trauma services.
But, the Times continues:
The hospital’s operating deficits have continued. Grady’s senior vice president, Matt Gove, estimated that its uncompensated care would grow by $50 million this year, up 25 percent. The new nonprofit board eliminated 150 jobs this year, closed an underused primary care clinic and began charging higher fees to patients who live outside of the two counties that support Grady with direct appropriations.
Now, is all this restructuring a victory for efficient management, or is it a defeat for public health? Time will tell, of course, as will the course of the next medical emergency or epidemic.
But in the meantime, if Washington wanted to help Grady, and all the people it serves, it would a) do what it takes to make sure that the hospital can offer (literally) life-saving services; b) fix extraneous cost-drivers, such as malpractice, c) figure out how to get everyone sufficient health insurance, so that there would be no more uncompensated care; and d) close the border to illegal immigration.
Please note, on that last point, that I didn't say, "close Grady to illegals"; I said "close the border to illegals." As the numbers in the Times story demonstrate, there are enough sick people here in the US to threaten our great health institutions. And a continued influx will spell the continuation of those unsustainable costs.
And, by the way, a continued influx of poor and uninsured illegals will cripple any "health care reform" that might be enacted in Washington. Supporters of Obamacare need to understand the point made by Froma Harrop--quoted earlier this month here at SMS--a robust welfare state cannot co-exist with open borders.
Jeremy Shane, a longtime healthcare watcher, reads The Wall Street Journal and The Washington Post this morning and makes a great point: "The government embraces breaking, not just bending, the cost curve when it comes to subsidizing 'clean' cars, but seems oblivious to the same techno-opportunity when it comes to healthcare."
Indeed. In today's WSJ we learn that the Energy Department is lending half-a-billion dollars to foster the development of electric cars, specifically, "The Karma," to be made by the Al Gore-backed Fisker Automotive, Inc. The Journal's Josh Mitchell and Stephen Power quote Henrik Fisker making a good point: Mr. Fisker says all new technology starts out being expensive. He pointed to flat-screen televisions that once started at $25,000 but are now affordable to the mass market."
Fisker is exactly right. On TV sets, the cost curve wasn't just bent, it was broken--or flattened--by flat screens. And that's what you want: the win-win of a better product at a lower price.
All technology starts out expensive and then, if it works, and is mass produced, it becomes cheaper and cheaper in real terms. It takes a lot of work, and a lot of money, and a lot of trial and error, but mass production, leading to economies of scale, is the proven method, having worked steadily and reliably for the past three centuries or so of the Industrial Revolution.
And the same logic applies to health care. Do you really want to save money on health care? Do you really want to "bend the curve"? Fine. Then help people live longer and better. Find cures to diseases, so people don't get sick. That's the politically sustainable way to break the curve.
And maybe such curve that's what our leaders in Washington have in mind, but there's no real evidence that they are thinking in those terms. Instead, all we hear about is new ways of saying "rationing"; the need to slow the introduction of new technology so as to slow the increase in costs.
Thus we get reworkings of the "Med Fed" idea--the idea of a "Federal Medical Reserve," as a play on the Federal Reserve Board, the nation's monetary overseer. The latest iteration of the idea comes from Dr. William R. Brody, president of the Salk Institute for Biological Studies, writing in The Washington Post today:
So why not let Congress continue to decide how much, in total, it is willing to obligate to Medicare spending each year? Then create an autonomous agency, like the Federal Reserve, to oversee and determine how Medicare dollars should be spent.
Members of this Federal Medicare Reserve would consist of a Board of Governors and a chairman, nominated by the president and confirmed by Congress, who would be charged with defining how the system should operate and how dollars should be allocated. There could also be a series of regional Medicare Reserve Boards that would provide more local oversight over Medicare payments.
It's an interesting idea--if. If the Med Fed were to grapple with the utilization of new technology as a way of bringing costs down, well, that could be good. Of course, it would also be complicated. But if the Med Fed were to take the simpler approach, of simply holding down costs--a.k.a. rationing--well, that would be bad. Disastrous, in fact, including disastrous politically for those who sought to create a Med Fed.
Politicians who vote for a Med Fed thinking that they can hide behind the remoteness of their new creation are kidding themselves. In a Glenn Beck-ed world, the voters will quickly figure out who is responsible for unpopular cuts.
That's the bad news. The good news is that if the politicians, and the policy wonks, could bring themselves to actually deliver better health to people the same Beck-watchers would reward them.
"The U.S. actually does a pretty good job of identifying and treating the major diseases," says Dr. Preston, a demographer at the University of Pennsylvania who is among the leading experts on mortality rates from disease.
Time magazine's Tara Kelly finds that Microsoft's Xbox can be can be repurposed into a life-saving tool. Kelly writes: A computer scientist at the University of Warwick in England has devised a way to use an Xbox 360 to detect heart defects and help prevent heart attacks. The new tool has the potential to revolutionize the medical industry because it is both faster and cheaper than the computer systems that are currently used by scientists to perform complex heart research.
Here are SMS, we are pleased to hear of this news. A computer is a computer, whether it's in a laptop or an airplane or a videogame. And the Xbox is a serious computer. So of course it can help on Serious Medicine. No doubt there are many more applications to be found.
"Flu Nightmare: In Severe Pandemic, Officials Ponder Disconnecting Ventilators From Some Patients." No, that's not a Facebook entry from Sarah "death panels" Palin. Instead, that's the headline put up by the blue-chip investigative outfit, Pro Publica: With scant public input, state and federal officials are pushing ahead with plans that -- during a severe flu outbreak -- would deny use of scarce ventilators by some patients to assure they would be available for patients judged to benefit the most from them.
The plans have been drawn up to give doctors specific guidelines for extreme circumstances, and they include procedures under which patients who weren’t improving would be removed from life support with or without permission of their families.
Pro Publica, helmed by Paul Steiger, the former managing editor of The Wall Street Journal, is funded by private donors, so it is not in the business of sensational headlines to sell papers. So when one of Steiger's team members, Sheri Fink, writes, people should take heed: Many of the draft guidelines, including those drawn up by the Veterans Health Administration, are based in part on a draft plan New York officials posted on a state web site two years ago and subsequently published in an academic journal. The New York protocol, which is still being finalized, also calls for hospitals to withhold ventilators from patients with serious chronic conditions such as kidney failure, cancers that have spread and have a poor prognosis, or "severe, irreversible neurological" conditions that are likely to be deadly.
There's no way to know if any of this will happen, but the Pro Publica report is a window into the triaged future we seem to be heading towards.
For those who say, "It can't happen here," well, maybe it will.
Editor's note: This is the first part of a two-part guest article detailing critical issues surrounding gastroparesis, and pseudo-obstruction, serious illnesses that cause paralysis of the digestive system.
As Michael Smith, a member of the board of directors of G-PACT, the Gastroparesis Patient Association for Cures and Treatments, points out, it's quite likely that research on gastroparesis will spin off research-benefits for sufferers from diabetes, lupus, scleroderma and cystic fibrosis, among other maladies.
Such spinoffs, of course, are part of the familiar "virtuous cycle" pattern of medical research. As Dr. Arthur Axelrad of Canadians for Health Research has pointed out, it was research on cancerous cells that made it possible to better understand how normal cells behave, thus vastly improving the chances that transplanted organs would be accepted by the host tissue.
But just as positive spinoffs are a constant in medical research, so are negative similarities. Mr. Smith's warnings about the deleterious impact of a) government decisionmaking, b) some DC-based advocacy groups, and c) trial lawyers are applicable to virtually every sector of medicine. Sooner or later, all supporters of a Serious Medicine Strategy find themselves in the same boat--so the sooner we all realize that commonality, the better!
Here is Mr. Smith's article, “Serious Medicine for the Paralytic Care of Digestive Tract Paralysis”:
The five million Americans suffering from digestive tract paralysis have been awaiting the revolution in medical technology that transformed the care of diseases such as polio and HIV-AIDS that James Pinkerton discusses at Serious Medicine Strategy.
Unfortunately, patients such as myself have not been invited to participate. This has not been for a lack of pure scientific will or achievement. Researchers dealing with digestive tract paralysis have discovered that the digestive tract has its own brain (the myenteric plexus, feeding off of the spinal column) and nervous system (the enteric nervous system). Researchers like Dr. Michael Gershon of Columbia University have made their life’s work studying and unraveling the massive complexity of this system.
Unfortunately, government agencies, such as the Food and Drug Administration, have ignored these details for decades, in favor of a "big picture" approach that fears the introduction of any risk in the treatment of complex medical conditions, in favor of a suffocating "we know it better" nannyism which I would hope would not be transported into the decisionmaking process of any health payment reform program. This nannyism is fully supported by groups such as Public Citizen, which chase drugs that treat digestive tract paralysis off of the US market--and, by the way, are funded by various class-action law firms throughout the US who seek to sue drug makers who dare to make such drugs out of the market.
What is Digestive Tract Paralysis? When asked, the layperson who has not been touched by one of this condition would assume that the digestive tract simply moves or that it functions off of gravity. A person not touched by this condition would realize that the digestive tract is controlled by an intricate set of nerves and muscles that when damaged by flu, trauma, spinal cord paralysis, cancer, diabetes, lupus, scleroderma or cystic fibrosis, essentially "shorts out" in the same manner as a circuit board struck by lightning. The result, in most people permanent is frankly chaos; unmitigated chest pain, similar to angina, caused by a esophagus that has lost nervous system control, a stomach that twists into uncontrollable spasm from the inability even to properly process the body’s own bacteria, much less food or liquid and a bowel that fails causing a person to poison themselves from the inability to process waste.
Why are the diseases of digestive tract paralysis unknown? Up until the beginning of the 1990’s, there really were no safe, effective treatments for the conditions. Even if you were a gastroenterologist capable of diagnosing digestive tract paralysis, you might not have been comfortable accepting patients with this diagnosis, as the only options you really had to offer were artificial nutrition and ostomy.
The early 90’s saw the development of a number of medications known as “digestive prokinetics”, medicines designed to reset the stalled peristalsis of the digestive tract through the amplification of various neurotransmitters in the gut, such as dopamine, serotonin and acetycholine. Unlike laxatives, these drugs were designed to “smooth out” the electrical rhythm of the gut, not just to purge it, but preserve its proper function. Without proper function, patients eventually not only faced paralysis of the digestive tract, but the after-effects of the situation, liver damage from artificial nutrition pumped through an IV that contained substances that were practically milk, heart damage from having these substances pumped through your cardiovascular system for 12 hours a day and neurologic damage from lack of proper nutrients. In addition, cost should be looked at as well. For patients, the choice between a pill for $45 a month, TPN for $2000 a month and intestinal transplant for $200,000 to $500,000 was an easy one.
Unfortunately, the FDA has never seen the choice in this fashion. FDA never keen on analyzing comparative risk or benefit of various treatments, saw risks in the use of digestive prokinetics that others simply did not see. In the case of Zelnorm, the last digestive prokinetic on the US market (which has the capability of regenerating digestive nerve and muscle tissue), FDA removed from the USA market due to a vague assessment of a 0.1% risk of cardiovascular side effects (i.e.- heart attack or angina), this was despite additional reports that the individuals who had these side effects had pre-existing cardiovascular conditions. With regard to a second prokinetic, Propulsid, Food and Drug removed it from the US market because 70 people suffered a cardiac condition known as prolonged QT syndrome, a condition that could have been diagnosed through the use of EKG. A final prokinetic, Domperidone which helps to restore proper swallowing function in individuals with paralysis never saw the light of day in the US, this despite the fact that its sister drug Reglan remains on the US market, despite the fact that it causes a Parkinson’s Disease like condition in about half of our patients, and unfortunately represents the mainline prokinetic left on the US market. A recent exchange of letters between myself and former FDA Acting Commissioner Dr. Frank Torti highlights our frustrations and our hope for proper, but dashed solutions.
At the crux of the FDA’s inability to properly deal with digestive tract paralysis are two groups and the failure of due process for all stakeholders in the discussion. The Ralph Nader-founded group Public Citizen has been at the forefront of attacking and successfully removing from the US market the digestive prokinetics. They have engaged in the “Jello stuck to the Wall” strategy of attacking all of these medicines for a wide variety of side effects, gallstones, ovarian cysts, etc. until they found a proper side effect to knock the medicines off of the US market. This information would be then fed into two places; the first being Public Citizens for–profit book Good Drugs, Bad Drugs; the second to, various class action law firms who have been successful not only in knocking drugs off of the US market,but in knocking drug company interest away from digestive tract paralysis.
During this period, patients suffering from digestive tract paralysis have seemingly lacked the comparable standing granted to Public Citizen and the class action lawyers. A hearing that was supposed to take place upon the removal of Zelnorm from the US market never take place. An educational session run by one of our sister organizations to educate the FDA on these conditions obviously fell on deaf ears. Attempts to work through Congress to advance awareness have at best been a long uphill climb.
Michael S. Smith, Esq. of New York, New York has had Chronic Intestinal Pseudo-Obstruction for twenty-two years. He is presently director and Counsel to G-PACT (www.g-pact.org), a national 501 (c) (3) non-profit dedicated to supporting the digestive paralysis community while fostering awareness of digestive paralysis and the need for better cures and treatments. He is also a Director of the Digestive Disease National Coalition, a group dedicated to advocating for better cures and treatments for all digestive diseases. If you have any questions or comments about this article, please do not hesitate to email him at MSmith8338@aol.com.
Editor's note: In a second article, coming soon, Mr. Smith will profile G-PACT's proposals for changing system and the obstacles to such change. And once again, I think that readers coming across the spectrum of Serious Medicine issues will see commonalities with their own specific concerns.
"The way it looks right now, people are going to be taxed, or they're going to pay fees, call it what you will, to help the insurance companies to acquire more customers. That's sort of the bottom line right now, without a public option or anything like that... when Karen Ignani, who's a terrific lobbyist, ends up being the main winner for the health insurance industry in this whole thing, that's a sign that this whole thing could fall apart. Mark my words." -- Howard Fineman on MSNBC's "Countdown" tonight.
And then, to underscore liberal discontent with Max Baucus's "mark," guest host Lawrence O'Donnell cited a White House report showing that health insurance company premiums had risen three to five times faster than the rate of inflation. And then he ran a clip of Joe Biden denouncing the insurance companies.
And O'Donnell told Wendell Potter that "This bill is likely to die of its own weight."
This piece was published earlier today at Foxnews' Fox Forum.
“Bending the cost curve” on health care is the hot wonk idea in Washington this year. Everybody in D.C. is talking about it: They want to flatten the upward angle, they say, of health care costs. Of course, as we all know, when they say “bending the cost curve,” they really mean rationing and imposing scarcity.
But what if the Beltway curve-benders are missing the point? The true point of health care, which is, after all healing? What if the real goal is not to bend curves down, or flatten them, but rather to bend them up?
The curves we really want to bend--and bend upward--are health curves. Cost curves are important, and nobody wants them to go up unnecessarily, but the curves that the American people really want to see bent--bent downward--are the curves of sickness and disease. Bend those “disease curves” downward, and the American people, currently deeply skeptical of the whole political crew in Powertown, would rally in support.
We’ve done disease-curve downward-bending before. We’ve bent down the curves for tuberculosis, polio, AIDS, and many other diseases. Is anybody you know suffering from scurvy? Or rickets? Or whooping cough? No? Good--mission accomplished.
The curve of those diseases has been bent downward, going from being huge killers and disablers to comparatively minor afflictions. Polio has virtually disappeared, tuberculosis is a minor problem for the public as a whole, and even AIDS deaths in the U.S. have fallen by more than two-thirds in the last fifteen years. We might pause to think more about AIDS: Just two decades ago, we were told that AIDS had the potential to be a mass plague in America, and yet now, thanks mostly to massive scientific intervention, AIDS has been reduced to a chronic disease, which kills every year just a fraction of the number currently dying from diabetes.
Every life lost is a tragedy, of course, and so there’s much more to be done. But the medical urgency of better health only underscores the moral necessity, as well as the political popularity, of bending death-and-disease curves, down to zero wherever possible.
We Americans think that life is precious. And so we are willing to spend a lot to improve, lengthen, and enhance life. In addition, in the back of our minds, we understand that good health is good economics; healthy people make for more economic output and invention than do sick people. Moreover, if we invent good medicines and treatments here, in this country, we can sell them to the rest of the world, creating jobs and generating economic benefits. In addition, if we wanted to, we could give such medical goods away, for either humanitarian or foreign-policy strategy reasons. What I have called the Serious Medicine Strategy is the ultimate example of “enlightened self-interest.”
It’s this larger view of the moral and economic value of good health that seems to elude the current crop of “experts” in Washington. They seem focused on the “cost” side of the ledger, while they mostly ignore the “benefit” side. If one only focuses on the “cost” side, then it makes sense, for example, to chop away at health care spending--to bend those cost curves downward. And if old people go untreated and die earlier? Well, as in Great Britain (sample headline: “Sentenced to death on the National Health Service”), that’s cheaper isn’t it? Isn’t rationing of health cheaper?
And if young people get sick and die from preventible diseases? Or if veterans cost an “inconvenient” amount of money in V.A. hospitals? Deaths in those categories are losses to both society and the economy--to say nothing of the families--but they could be, and are, seen as savings in the eyes of government bean-counters. Seen only a short time-horizon, the scarcity model is cheaper.
In contrast to the number-crunchings of cost-obsessed bureaucrats, if one looks at the whole of life, including all the benefits of being alive, then one further sees that the benefits of a healthy, happy, and productive people far outweigh the costs.
And by the way, someone should tell elected politicians, who are more sensitive to public opinion than the unelected bureaucrats who do the policy advising and agenda-setting: The folks out there will re-elect only the politicians who seem to be rooting for them to succeed at living long and happy lives.
But in the meantime, at least until the next midterm election, both the political and policy elites are locked into their vision of curve-bending cost containment. Testifying before Congress in June,Christina Romer, chair of the White House Council of Economic Advisers, declared, “In discussing cost containment, I want to focus on slowing the rate of costs. This is the so-called ‘curve-bending’ that can last for decades.” And not to be outdone on curve-bending, Aetna Insurance has created a whole website, entitled “bending the cost curve.com.”
For the most part, political appointees, such as Romer, and insurance companies, such as Aetna, are careful to say that they want to see no loss in the quality of treatment. And if pressed about the prospect of future medical improvements--which might lead to new cures, and a long-term reduction of costs, by making people healthier--they would undoubtedly say, yes, they are for those kinds of improvements. But such talk about medical improvements is strikingly absent from their testimonies and advertisements. And why is that? Because Romer, Aetna, and all the rest are cost reducers, not benefit increasers.
But then Klein, the staunch Obamacare guy, added a revealing sentence in his Post piece, as he mulled over what might worry the White House healthcare policy team: “What if it finds that some brand-new and incredibly expensive treatments are wildly effective? That could raise spending.” [emphasis added] Well, yes, a “wildly effective” treatment could “raise spending.” But here’s a not-so-bold claim: People would love to learn of a great new treatment. The average American would cheer. But Klein’s choice of words reveals much about how Washington elites see the issue of medical innovation; such progress is to be dreaded, not heralded.
Obviously, some curves are meant to be bent, with or without medical breakthroughs. Sometimes less is good. If one is overweight, one should eat less. If one smokes, one should stop. But the politics of nagging and nudging people about their health-styles are tricky, full of human-nature-based boomerangs and backlashes. And as we have seen twice now, during “Clintoncare” in 1993 and now Obamacare in 2009, the politics of cost-curve reduction are toxic.
It’s no secret that fans of the current MedPAC want to see it grow much stronger in its ability to control costs. They hope that MedPAC could become as secretively powerful over health care as the Federal Reserve Board has been secretively powerful over monetary policy. It is better, Obamacare advocates figure, to kick “tough” decisions over to an an un-elected group of obscure experts--and such a plan would be good, of course, for the ongoing employment of the expert class. Indeed, would-be Obama health czar Tom Daschle proposed a “Federal Health Board” last year in his book, Critical: What We Can Do About the Health-Care Crisis. Echoing Daschle, CFRB/PPCBR budget experts made a (very) little joke, calling their strengthening idea “MedPAC on steroids.”
There’s a certain logic in trying to sneak such curve-bending cuts under the political radar, but there’s no logic if the curve-bending stratagem is guaranteed to be “outed” as scarcity and rationing, and thus guaranteed to be voted down. And yet that sort of politically fatal exposure is a certainty in today’s media environment--a world of Glenn Beck and Rush Limbaugh and any number of Internet-based diggers and bloggers.
There is simply no chance that a “MedPAC on steroids” would be effective in its work in a small “d” democratic society. By herself, working from her Facebook page, Sarah “death panels” Palin alone could beat back a MedPAC.
The cost-curve controllers have driven head-on into the trap of what free-market economists call static analysis. What they need is dynamic analysis, which could point the way toward better health and lower costs.
The New Republic's Jonathan Cohn has just debuted a clever new feature in the health care debate, "What would Harry do?" It's a left-of-center look at the health care debate, in which Cohn tabulates the judgment of 13 liberal-left health care experts and asks them to rate, for example, Max Baucus' health care plan.
Harry Truman, of course, first proposed a national health insurance plan in November 1945, less than three months after VJ Day. It was defeated, but Truman's name lives on as a champion of what he called "compulsory social insurance." (Obviously the focus groupers, and their honed and honeyed phrases, never got to Plain Speaking Harry.)
It's a smart choice for Cohn & Co. to use Truman. He is after all, one of our most admired presidents, albeit mostly, these days, for his successful architecture of the politico-military framework that ultimately won the Cold War.
But even fans of Truman might ask: What would the 33rd President really think of what his fellow Democrats are doing on health care?
Although there's no doubt that Truman would have been strongly for national health insurance, one wonders if he would think that it was a good idea for trial lawyers to be looting the system?
As a fan of Truman, I kinda think that Truman would be more likely to "give 'em hell." That is, he would call out the trial lawyers who are putting all through "lawsuit hell," as Newsweek put it six years ago.
He might even agree with Sarah Palin: No health care reform without tort reform. Of course, Truman understood that politics was the art of the possible, and so in the end he might have made some compromise if he concluded that he had to, but he surely would have first called 'em out for the bad and costly things that they were doing.
But don't look for Cohn and The New Republic to start rating health care plans according to the Palin index. They can't even bring themselves to mention the issue of tort reform.
In the meantime, of course, proponents of a Serious Medicine Strategy see little or nothing in the Baucus bill that would actually move America toward curing more diseases.
Serious Medicine is based on the idea that science and technology can "bend the curve" of illness and incapacitation. That is, not just help us "lose cheaper" to disease, but actually to fight back and win. A big part of curve-bending is the application of dynamic analysis--and more to the point, apply a dynamic solution. Don't just accept what Mother Nature has done to us, and maybe figure out how to trim the costs here and there, but instead, reject the idea that we are ordained to get sick and die from a disease that can be cured.
The Serious Medicine Strategy is based on the idea that the American people want us--all of us--to fully mobilize against illness and incapacitation. If we do, if cures come into existence, then Americans stand ready to reward the mobilizers with money, votes, and approbation.
And so I am always intrigued by examples of scientists and associated visionaries who figured out how to achieve profound increases in output, productivity, and effectiveness. It happens all the time: It's called "progress."
A case in point is Norman Borlaug, who bent the curve on agricultural productivity, thus causing "the green revolution" in the Third World, which saved millions, maybe billions, from starvation. For his heroic efforts, Borlaug won wide praise, including the Nobel Peace Prize. Borlaug died last week at 95, having fought the good fight, indeed. As Henry I. Miller wrote today in a tribute in The Washington Times: How successful were Mr. Borlaug's efforts? From 1950 to 1992, the world's grain output rose from 692 million tons produced on 1.70 billion acres of cropland to 1.9 billion tons on 1.73 billion acres of cropland -- an extraordinary increase in yield of more than 150 percent.
A 150 percent increase in productivity? That's nothing in the computer world, where we have been on the steep part of the "S" curve for decades now. But for the most everything else, a 150 percent increase in productivity is pretty darn good. Most sufferers from disease would be happy to know that their chances of survival had increased by 150 percent.
If the late Norman Borlaug could do it, so can others. And if they do, we will shower them with our gratitude.
That's Serious Medicine in action, and it's also an example of Serious Economics (to borrow a phrase from San Diego-based blogger Paul Wilkinson), in the sense that through this contribution, the world economy is contributing to the improvement of the US economy, as well as the world's health. Much more is possible, of course, if we embrace a Serious Medicine Strategy, in which we focus on creating health care "enterprise zones" in the U.S.
In the WaPo this morning, Susan Kinzie does a great job of explaining the stakes: In one of the largest philanthropic donations ever made to a U.S. pediatric hospital, Children's National Medical Center will receive $150 million from the government of Abu Dhabi -- a gift that the hospital hopes to use to dramatically change pediatric surgery.
The donation, which will be announced Wednesday morning, has the potential to transform Children's Hospital, enabling it to hire more than 100 surgeons, researchers and staff members over the next few years, hospital officials said. Its arrival amid a recession has created palpable excitement at the Northwest Washington hospital, which treats thousands of children and performs 15,000 surgeries each year.
The Post piece is also a great reminder that the rest of the world aspires to our Serious Medicine. They want it for themselves, just as we want it for ourselves. And through a combination of enlightened self-interest, entrepreneurship, and national strategy, it should be possible to spread the benefits of Serious Medicine to the world. It is possible, in fact--it's already happening.
Interestingly, and poignantly, the driving force in brokering this $150 donation was Joseph Robert Jr., long a prominent businessman-philanthropist, who has given $25 million himself to Children's. As the Post notes, though, Robert has recently been diagnosed with brain cancer: For Robert, the gift represents a triumph. Recently he received a diagnosis of the same type of brain cancer that afflicted Sen. Edward M. Kennedy (D-Mass.). After giving away millions and raising millions more for charity, he compares his current philanthropic efforts to playing basketball at an arcade.
"I'm trying to get as many scores, put the ball through the hoop as many times as I can with the limited time I have left," he said.
At the hospital Wednesday, when the ambassador, the executives and the doctors gather to talk about how much the institute will change pediatric medicine, Robert said he will be thinking, "What needs to get done next?"
The University of Chicago's Robert Fogel won the Nobel Prize for Economics in 1993. In this piece, published in The American, the magazine of the American Enterprise Institute, Fogel argues that health care is a superior good, and so the percentage of our income that we spend on health care has been rising for centuries. As he sums it up, "For every 1 percent increase in a family’s income, the family wants to increase its expenditures on healthcare by 1.6 percent." Is this a good thing or a bad thing? People can argue, but Fogel thinks it's a good thing: Consequently, there is no need to suppress the demand for healthcare. Expenditures on healthcare are driven by demand, which is spurred by income and by advances in biotechnology that make health interventions increasingly effective. Just as electricity and manufacturing were the industries that stimulated the growth of the rest of the economy at the beginning of the 20th century, healthcare is the growth industry of the 21st century. It is a leading sector, which means that expenditures on healthcare will pull forward a wide array of other industries including manufacturing, education, financial services, communications, and construction.
This is an important point to dwell on, because the conventional wisdom holds just the opposite--that we are spending too much, that we must cut back. But Fogel's point isn't just that spending on health care is justified because people want it, his further point is that the demand for health care is an economic driver for the entire economy. That is, the desire to be healthy--more precisely, the desire to consume goods and services that make us healthier--is something to be treasured, for the sake of the overall general welfare.
But in the meantime, the conventional wisdom is thick upon us. For example, Katherine Hobson, writing in US News this summer, had this to say about health care technology, and thus expenditures: Americans adore technology. We love our iPods, our Kindles, our TiVos, our Xboxes, and our smartphones. So it's no surprise that our high-tech infatuation extends to our medical system, where we zap prostate cancer in multimillion-dollar proton-beam therapy centers, implant defibrillators in chests to shock hearts back to life, use robots to perform surgery, and take detailed pictures of every part of our bodies using constantly advancing imaging technology.
The trouble is, we really can't afford it. Experts say that spending on new health technology—not just fancy machines but also drugs, devices, and procedures—makes up as much as two thirds of the more than 6 percent annual increase in healthcare costs (this year's costs: $2.5 trillion). "It's one of the key reasons why U.S. healthcare is so expensive," says Winifred Hayes, founder and CEO of Hayes Inc., a health technology research and consulting firm. The problem isn't usually the technology itself but rather its use in certain patients where it hasn't been shown to help more than cheaper options do—or at all.
Such criticism of healthcare expenditures is common, of course, but it's ironic coming from US News, which published her critique in the August 2009 issue, which bannered, "America's Best Hospitals: How new technology is transforming medical care." That is, the whole reason that US News put out that particular issue was to trumpet health care issues--and the only reason anybody bought that particular issue. Which is to say, the mere existence of that issue of the magazine is testimony to the economic driving power of health care.
"If you tax something, you get less of it. If you subsidize something, you get more of it." That's wisdom from Milton Friedman, although, of course, grandmothers know the same thing.
So this story in Politico, "Medical-device makers launch a lobbying blitz," caught my eye. In the piece, reporters Chris Frates and Carrie Budoff Brown report that the Senate Finance Committee is eyeing various new taxes on medical equipment. Needless to say, the medical equipment makers are mobilizing to combat this tax threat.
A caveat here: The world of health care financing is murkier than murky. Uncle Sam is more than capable of taxing with one hand and subsidizing with the other, and so I am hesitant to draw any final conclusions about this controversy until I can learn more about what's all at stake.
But at first blush, what's at stake seems very important--much more important, in fact, than the fate of this or that health-insurance provision within Obamacare.
Why so? Because the long term future of health care--and medicine, and cures, and the quality of our lives--is going to be driven by the use of new technology. Such technology (including pharmaceuticals) will not make us healthier, but will save money in the long run, because people will stay healthy/get back to work sooner, and because improving productivity makes costs fall over time. Want proof? Take the polio vaccine. Poof! The disease has all but disappeared in the half-century since Jonas Salk introduced the vaccine.
Yet it would appear that the federal government is seeking to achieve cost-control goals on a much narrower time horizon, and according to a much more limited vision of the American commonweal. The feds seem to be following on the ideas that OMB director Peter Orszag laid out in testimony to the very same Senate Finance Committee last year, when he was still director of the Congressional Budget Office: not only raising revenue through an equipment tax, but also slowing the rate of healthcare spending growth by slowing the growth and utilization of technology.
Here's the exact quote from Orszag: Future increases in spending could be moderated if costly new medical services were adopted more selectively in the future than they have been in the past and if the diffusion of existing costly services was slowed. Although that approach would mean fewer medical services, evidence suggests that savings are possible without a substantial loss of clinical value. Currently, the added clinical bene- fits of new medical services are not always weighed against added costs before those services enter common clinical practice. And newer, more expensive services are sometimes used in cases in which older, cheaper alternatives could offer comparable outcomes for patients.
Once again, one must be careful about leaping to unfair conclusions, based on fragmentary reports. But it's seems reasonable to conclude that healthcare hierarchs in Washington DC are following through on the Orszag idea: slow costs by slowing technological development.
Their plan won't be expressed that way, of course, by the Obama administration. Orszag had a lot more latitude to say what he really thinks at CBO than he does now at OMB. Instead, any determination to whittle away at healthcare technology will be expressed in benign-sounding language about combating inefficiency, and waste, fraud, and abuse--just the President said in his Congressional speech last week.
SMS has a certain bias against new taxes, but SMS really has a bias in favor of new health- and life-giving technology, which will help Americans combat the diseases and afflictions that incapacitating and killing them. And I am confident that the vast majority of Americans--no matter what their view on this tax or that tax--share that pro-living proclivity.
When we think about it, we all realize that such new technology will a) improve the lives of Americans, and b) such technology will grow cheaper over time--that's the natural course of the industrial revolution over the past three centuries, and nothing has changed, or will change. Absent a return to the Dark Ages, the basic rules of economies of scale will always tend to make technology both cheaper and better.
In addition to a) and b) we can add c): The new technology that we generate can then be sold to the world--a world which increasingly has our health profile. That is, heavier on lifestyle-related diseases, and, well, heavier. Result: better health, and more economic activity. A win-win!
This can all happen, unless, of course, we strangle the promise of new technology, in short-sighted pursuit of the shortest of short-term cost-savings.