What does GOP think will come after they sabotage (or repeal) Obamacare?

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Comrade Trump, are you listening?

Just after the election I wrote (Goodbye Obamacare? More like hello single payer!) to lay out my vision of where Republican dysfunction and ideology could ultimately lead. At the time I said:

Trump himself has been at least a liberal and frankly more of a socialist when it comes to health care policy, at least based on his earlier writings. Once he learns that the ideas of the conservatives in Congress won’t produce universal coverage, he may well go back to improving –instead of replacing– Obamacare, moving to a Canadian style single payer system, or opening up Medicare for all, just like Bernie and much more radical than Hillary.

The last six months of Republican flailing on healthcare makes it even more likely that socialism will ultimately come to the US healthcare system. Here’s why:

Americans –and that includes Republicans– now expect insurance to be available without restriction or penalty to those with so-called pre-existing conditions. Everyone wants lower premiums and out-of-pocket costs, and Obamacare opponents are beating up on the ACA for failing to deliver. But nothing the GOP is doing is helping advance these goals. Most of GOP proposals actually undermine these objectives.

Meanwhile, Trump and Congress are creating uncertainty about the exchanges and actively undermining them, e.g., by refusing to enforce the mandate, talking about exchanges failing, and using public money meant for promotion of Obamacare to undermine it.

The Affordable Care Act is a moderate piece of legislations, with free-market concepts like health insurance exchanges that conservatives would like if they looked at them objectively, and which were included in order to generate support from some in the GOP.

But with all the chaos, ill will, and sabotage of Obamacare by the Administration, liberals and centrists are now talking about more radical ideas. In particular, the concept of a single payer health system is now being discussed openly and seriously, something that would not have happened if Congress had done the sensible thing and made improvements to Obamacare.

What happens next? If, for example, repeal without replace goes through, then I think we’ll see single payer come up as a mainstream topic in the 2020 presidential election (assuming we are still holding elections in this country by then).

I also expect that rather than move to a Medicare for all model we may see more talk about Medicaid for all. It’s cheaper, because it pays providers less, and coverage is far more comprehensive. It  could serve as a baseline for universal coverage.

The healthcare morass is keeping Republicans from tackling other legislative priorities that supposedly would be easier to accomplish, such as tax reform –or more likely, straight tax cuts. If you’re an opponent of the GOP agenda, then the extended fight over healthcare is not such a bad thing.

I do worry, though, that as the administration continues to flail from the Russia investigations and lack of legislative success, they will resort to desperate tactics that could have dire consequences. In particular I’m worried that the GOP won’t take seriously the necessity to raise (or better yet, eliminate) the debt ceiling. They may try to tie a lot of unrelated issues, including Obamacare repeal, to this must-pass bill. Once the US is in default, all bets are off.


By healthcare business consultant David E. Williams, president of Health Business Group.

Sorry Fred. It will take more than teamwork to fix GOP healthcare dysfunction

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GOP 2017. What a team!

Why can’t the Republican Congress manage to repeal and replace Obamacare, considering the whole party has campaigned for seven years on the promise to do just that? According to Fred Barnes of the Wall Street Journal the answer is simple: the Republicans are not playing as a team. In Barnes’ reality, if the GOP would only treat politics as the team sport it is they could create “a more free-market healthcare system in which people can buy the insurance they want, not what government requires.” It sounds so beautiful I’m sure everyone will put aside their differences and make it happen!

Alas, with two more Republican Senators coming out against the bill the same day the Op-Ed was published, it doesn’t seem that Mr. Barnes is making much headway.

But Barnes has misunderstood the real causes of Republican disarray on healthcare. For his benefit, here are some:

  • The Affordable Care Act is actually a well thought out, moderate piece of legislation, not a looney left-wing one. It contains a variety of market oriented and conservative principles that were designed to encourage Republicans to vote for it. Major facets include the individual mandate (personal responsibility, supposed to be a conservative idea remember?) and the insurance exchanges/marketplaces, where private insurers compete for business.
  • Despite what Republicans say now, there were numerous attempts to bring them into the fold in 2009 and 2010 and enact a bipartisan law. But Republicans decided to stand uniformly against the ACA, showing that there’s plenty of “teamwork” and discipline available, but only when it comes to saying no.
  • Once Obamacare was in place, Republicans did all they could to undermine it: filing frivolous lawsuits, wiping out the risk corridors, lying about death panels, blocking navigators from doing their work, and voting to repeal the law over and over again, but only when Obama was there to veto it. They’re still at it, trying to destroy the insurance exchanges even though Republicans are in charge.
  • Despite talking about “repeal and replace” they never came up with a serious “replace” approach. Most of the so-called ideas were tired talking points trotted out as though they would make a big difference: selling insurance across state lines, enacting tort reform, and promoting drug re-importation. (This is really where the term “nothing burger” should be employed.) House Speaker Paul Ryan’s undeserved reputation as a big thinker should be fully crushed by now.
  • Congressional Republicans have fallen in line behind a president who knows nothing about healthcare policy, has no idea what’s in the House or Senate bills (assuming he even knows how the legislative branch works) and promised “something terrific” but never has and never will explain what it is.

Congressional Republicans should hit the reset button. They should apologize for how horribly they’ve behaved on healthcare policy, and work with Democrats on common sense improvements to the Affordable Care Act. Instead it sounds like the new idea is just to repeal and then spend another couple years trying to figure out what replacement would be.

Truth is, Republican legislators gave up on governing to become the party of no. It worked pretty well in the short and medium term, bringing with it Congressional majorities, the presidency, and a stolen Supreme Court seat.

Now would be a nice time for the GOP to grow up. Healthcare is a good place to start, and if they put country ahead of party they’ll find plenty of Democrats to cooperate. Personally I’m not betting that will happen.

Meantime, maybe Mr. Barnes will start arguing for teamwork when it comes to raising the debt limit. Rah! Go team!

By healthcare business consultant David E. Williams, president of Health Business Group.

 

 

 

 

Tufts nursing impasse: I’m quoted in the Boston Globe

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Who “wins” in a strike?

The first nursing strike in Boston in three decades is an ugly situation. I feel badly about it, especially for patients and their families who are collateral damage. Even if the quality of care is the same with the replacement nurses, the extra stress and aggravation really are a problem.

I’m quoted on the dispute in today’s front page Boston Globe story (At Tufts Medical Center, pressure to cut costs in a city rich with hospitals). I’m not directly involved with Tufts management or nursing leadership, so I commented on the overall environment in which its occurring.

“I think the root cause is that Tufts has to compete with the other academic medical centers in the city, and they don’t get the same level of reimbursement,” said David E. Williams, a consultant at Health Business Group in Boston. “The disparities of the payments actually cause friction in the labor market.”

The story of unequal payments to Boston area hospitals is not a new one, and people have heard about it so often that they’ve tended to zone out. But this is the first time I can think of that labor relations have taken a public hit as a result, so perhaps it will reinvigorate the debate.

Meanwhile, few of the articles about the strike provide broader context about where nurses fit in to hospital finances. A couple of statistics are worth mentioning:

  • A 2015 study published in the Journal of Nursing Administration (Hospital Nursing Workforce Costs, Wages, Occupational Mix, and Resource Utilizationconcluded that nursing labor accounts for just over 30 percent of total hospital costs. That means nursing costs are central to hospital finances and it explains why Tufts isn’t just giving in in the face of the strike.
  • Nurses in Boston earn six-figure incomes. According to Tufts, its senior nurses (which represent 60 percent of the total staff) “earned an average of $152,000 in 2016.” That’s comparable to what some primary care physicians make.

I hope the dispute is resolved soon, so that the nurses and the rest of the Tufts team can get on with the job of caring for patients. If the strike ends up stimulating a serious debate about inequities in hospital reimbursement, that will be its only silver lining.

By healthcare business consultant David E. Williams, president of Health Business Group.

Medial EarlySign: machine learning for population health (podcast)



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Medial EarlySign analyzes standard EHR data to identify individuals at high risk for disease. The company’s first solution, ColonFlag uses longitudinal blood test data to identify patients who are at high risk for colorectal cancer.

I spoke recently with Medial executive Tomer Amit, who filled me in on the company’s approach and explained why the company has been named a Cool Vendor in AI by Gartner.

  • (0:15) What unmet need are you serving?
  • (1:05) You talk about using data that’s already available. What kind of data?
  • (3:02) When you mention “historical data” are you talking about longitudinal data for an individual patient or aggregated data for a population?
  • (4:18) Why is colorectal cancer an initial focus for the company, with your ColonFlag solution?
  • (5:13) Does ColonFlag replace colonoscopy or encourage someone to get one if they have an indicator that they are at greater risk?
  • (6:38) I see how it could help an individual. Would it actually help at the population level?
  • (7:45) You started in Israel and the EU, which have strong longitudinal medical records. Can the approach be applied in the US where that’s not the case?
  • (10:41) You have run your tests in different places around the world. Does the model differ by population or is there a universal algorithm?
  • (12:10) How do you protect your intellectual property? Once you are out there, are there just rules of thumb people can use instead of working with you?
  • (13:14) What traction have you gained with customers or partners? What industry recognition have you received?
  • (14:45) Are there other domains you are investigating beyond colon cancer? Other data beyond blood tests?
  • (15:58) What’s your 5-10 year vision of what’s possible and what Medial’s role will be?

By healthcare business consultant David E. Williams, president of Health Business Group.

Health Business Group announces leader for its Australia/Asia practice

I’m excited to announce that Dan Segal will join Health Business Group as a principal, leading our practice in the Australia and Asia. The press release is below:

Dan Segal joins Health Business Group

Industry veteran will lead consulting firm’s practice in Australia and Asia
Dan Segal, Principal, Health Business Group
Dan Segal, Principal, Health Business Group

BOSTON – June 20, 2017 – PRLog — Health Business Group a leading strategy consulting boutique advising companies, non-profits and investors in health care services, digital health, pharmaceutical services, and medical devices has appointed Dan Segal as Principal. Mr. Segal will lead Health Business Group’s efforts in Australia and Asia; a major focus will be on supporting overseas clients’ entry and growth in the US market.

Segal was a co-founder of Brain Resource Ltd., a publicly traded neuroscience company, where he served as COO and a board member for the past 15 years. He has extensive experience in commercializing healthcare technologies in the US and globally, including strategic planning, regulatory navigation, clinical trial planning and execution, IT development, ISMS and GCP systems, business development, and reimbursement.

“We are thrilled that Dan has joined our team,” said David E. Williams, president of Health Business Group. “He brings the knowledge, skills, and contacts needed to support Australian and Asian healthcare companies as they navigate the lucrative but complex American market, and he will be a strong addition to our client service teams.”

“I am pleased to be joining the Health Business Group,” said Segal. “They are a highly experienced team that I have known for many years and hold in the utmost regard. Working with a Boston-based firm will provide my clients with strong links into the US healthcare ecosystem that are just not available remotely.”

Segal will divide his time between Australia, Asia and the US, and will work closely with Health Business Group colleagues in Boston, New Jersey and the West Coast.

Earlier in his career, Segal was a Director in the Equities Research Department of Citigroup, where he was highly ranked as a telecommunications and technology sector analyst. He has been a member of the Australian Institute of Chartered Accountants for 30 years and has qualifications in Science and Commerce: Bachelor of Commerce from the University of New South Wales, Bachelor of Science (Honors) from the University of Sydney and a Master of Science (Physics) from the University of New South Wales. He retains an active research interest in connections between physics and the brain and has authored both science and business articles, ranging from personalized medicine and digital health to semiconductor physics.

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About Health Business Group:

Health Business Group http://www.healthbusinessgroup.com is a leading strategy consulting boutique, advising companies, non-profits, and investors in healthcare services, digital health, medical devices, and pharmaceutical services. Our client service professionals average more than 20 years of health care consulting, industry and start-up experience.

Contact
Karen Donovan
(617) 512-4582

Could Medicaid for all be the answer?

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Putting it all together

The Affordable Care Act is a complex law, but for a major piece of legislation that actually made it all the way through a very open legislative process, it’s remarkably coherent. Republicans have tried to sabotage it since before it was passed, and yet it still managed to succeed while a Democratic Administration remained in power. I have predicted in the past that if Republicans actually managed to poison Obamacare that they would come to regret it, because it would lead eventually to the rise of a single payer (i.e., truly socialist) system.

I assumed that the move toward single payer would take a generation to happen and would be driven at the federal level. But Nevada’s quick embrace of Medicaid for everyone surprised me, and it looks like a good option that addressed a lot of tough healthcare financing problems. Even if this Nevada plan ultimately dies on the vine, it provides a template for other states.

Here’s the basic story behind the Nevada Care Plan: Obamacare supporters are worried about what will happen to people who use the exchanges/marketplaces if Trump or Congress is successful in destroying the markets. Trump has been wreaking havoc on the marketplaces by threatening to cut off the subsidies that make premiums and out-of-pocket expenses affordable. The American Health Care Act (AHCA), aka Trumpcare, Ryancare, etc. would be the death knell. As a result, millions of people who get insurance through exchanges today would be out of luck.

A Medicaid for all approach enables people at any income level to buy into Medicaid, paying premiums if their income is too high to qualify under current rules or if they are are otherwise ineligible. Medicaid provides a very comprehensive set of benefits –broader, in some ways, than commercial plans or Medicare. Prescription drugs are covered, and so is nursing home care. Even better for the patient, there are no co-pays or deductibles. Cost per patient is lower than commercial plans or Medicare because Medicaid pays physicians and hospitals rock bottom rates, and by law Medicaid gets the best pricing on drugs.

Interestingly, many of the insurance companies that have succeeded on the exchanges are Medicaid managed care plans like Centene and Molina that have adapted their products to the Obamacare population.

Medicaid for all would not preclude private plans from participating in the market. In fact, its existence could pave the way for a variety of supplemental or upgraded plans that could be purchased by individuals or offered by employers. That approach is similar to what happens in other rich countries like the UK.

In summary, Medicaid for all has some really good features:

  • It bends the cost curve considerably by forcing lower prices on hospitals, physicians and other providers. The main reason healthcare spending is higher in the US than in other rich countries is because unit prices are higher here. In one fell swoop that could be addressed, even if providers aren’t entirely pleased.
  • Drug pricing, which is such a lightning rod, could also be addressed quickly by bringing prices into the Medicaid framework, the one place where they are reasonably well controlled.
  • It would enable everyone who wants to be covered to be covered.
  • It would eliminate the vagaries of the exchanges. No one would need to worry about whether insurance companies would offer plans from year to year.
  • In theory, it could enable states to innovate, assuming that they are given the freedom to modify benefits around the edges.

Admittedly, Medicaid for all might dampen innovation by reducing the financial incentives for the introduction of new drugs and devices and placing more control in the hands of government. But frankly commercial health plans have not done a good job of spurring innovation or cutting costs; few people are likely to shed a tear if their role is reduced.

By healthcare business consultant David E. Williams, president of Health Business Group.

 

GOP ignores the Cadillac already in the garage

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Cadillac taxi?

The Wall Street Journal is a serious newspaper, so I had to laugh when I read GOP Senators weigh taxing employer health-plans. Apparently Senators are thinking about including a new tax in their Obamacare repeal bill in order to raise revenue, improve equity, and reduce the distorted incentives that divert taxable wages into non-taxable healthcare expenses.

We learn from the article that although it’s a solid policy idea and is being considered by many Republicans, “it could be politically risky, since it could expand the impact of GOP health proposals from Medicaid recipients and those who buy insurance on their own to the roughly 177 million people who get coverage through their employers.”

Republicans accused Obamacare opponents of not having read the Affordable Care Act before approving it in 2010. Seven years later it appears Republicans themselves haven’t read the law that they are now trying to overturn. If they did they would discover that Obamacare already includes this provision, an excise tax on high cost employer plans, nicknamed the Cadillac tax.

It’s far from perfect, but it’s not so bad either. It places a steep tax on corporate health spending above a certain high level, thus limiting the impact to the most serious cases, discouraging healthcare inflation, and phasing the tax in gradually.

So rather than wasting time discussing a new approach where consensus will be hard to forge, all the GOP has to do is leave the Cadillac tax in place. While they’re at it they might consider leaving the rest of the Obamacare in place, too, and working to improve the few areas that need a tune-up.

But I read the whole article in the print edition without finding any mention of the Cadillac tax. Someone must have pointed that out to the editor, because the online version tacked on two sentences at the end about it.

As I argued back in February (Can Congress agree on the Cadillac tax?) limiting the tax deductibility of employer sponsored health insurance is a good idea, but is opposed by a huge array of forces on the left and the right. I advocated then and am suggesting now, to leave the Cadillac tax in place.

By healthcare business consultant David E. Williams, president of Health Business Group.