Healthcare to the Max

Senator Max Baucus, (chairman of the Senate Finance Committee) is proposing legislation to “cover the 47 million uninsured.” 

But …

Neither he nor his staff are offering any cost estimates. The plan proposed by President-Elect Obama during the campaign was estimated to cost about $100 billion a year.  Any savings from healthcare IT (another urgent need) or follow-on biologics (the price differentials from which will look nothing like small molecule generics) are but a glimmer of future hope in the eyes of the OMB.  How are we going to pay for this?  Stock options?

One of Senator Baucus’ recommendations is to reduce healthcare costs is via comparative effectiveness.  In global health policy circles this is generally referred to as “HTA” – Healthcare Technology Assessment.  To physicians and patients in Canada, Great Britain and elsewhere it is generally referred to as “rationing.”  According to Sir Michael Rawlins, chairman of Great Britain’s National Institute for Health and Clinical Excellence (NICE), "Rationing is a necessary evil. We have to do it. There will be losers and winners." Ouch.

In the last session of Congress, Senator Baucus and Senator Conrad introduced the “The Comparative Effectiveness Research Act of 2008 (CERA).” This legislation would create a Health Care Comparative Effectiveness Research Institute.  Comparative effectiveness centralizes clinical decision-making, and replaces the judgment, variation and response of doctors and patients with a handful of Beltway-appointed elites who, despite transparent procedures, impose standards and use methods that are cost-based rather than patient-centric.

It is urgently important to engage early and in a robust manner in this debate.  The philosophy behind comparative effectiveness (using the current blunt, short-term, price-centric tools used in Europe and Canada) is a giant first step towards healthcare rationing and, ultimately, price controls.  This would spell an end to pharmaceutical innovation as we know it – and to what end?

The most likely immediate result of 20^th century cost-effectiveness in a 21^st century world would be the reduction of on-patent reimbursement and, ergo, a physician’s ability to practice medicine according to her patient’s individual therapeutic needs.  That’s the trade-off -- a short-term decrease in a line item (on-patent medications) that represents only 7% of the entire American healthcare spend for the future of healthcare innovation.  It’s a bad choice – a Hobson’s Choice.

It’s a particularly bad choice for the severely ill, commercially-insured population. A recent study published in Health Affairs found that the costs of medical services to this population account for more than 75% of health plan costs. Hospitalization costs accounted for half of this amount. In contrast, medications accounted for just over 20% of health spending for this group, whose annual costs are more than nine times higher than the overall plan population. The authors concluded that medication costs “do not seem to be the driver of health care costs for these members.” And among the 2.5% of members with the highest spending, specialty medicines (defined in this study as "biologic-derived agents that target specific immune processes and proteins”) were used by 45% and accounted for 32% of spending on medicines and just 6.6% of total plan spending.

Que CERA sera. Or as Aldous Huxley said, “Facts do not cease to exist because they are ignored.”

We often talk about “first principles.”  According to Senator Baucus’ website, “The first principle is universal coverage.”  Rhetoric is important here.  “Universal” healthcare means “Government” healthcare. And that certainly doesn’t mean “Free” healthcare. 

And that “47 million uninsured” number really has be addressed honestly. 

What is Senator Baucus’ position on the scores of healthy young people — close to 20 million, by some accounts — who elect not to buy health insurance even though they can afford it? They voluntarily choose not to have health insurance — which is quite different from not being able to get health insurance.  Would they have to pay a penalty to electing not to have health insurance?  President-Elect Obama was asked if his healthcare plan would penalize the decision not to be insured.  He was asked it directly.  And he said “no.”  You can look t up.

Or what about government-paid care for the 10 million uninsured illegal aliens. Every politician calling for “universal care” has been silent on this topic – except to include them in the count.

And what about the 12 million people (half of whom are children) who currently qualify for SCHIP but are not signed up?

These are facts and must be part of the debate.

The good news is that Senator Baucus is a smart and savvy guy, a terrific legislator. – and he really understands healthcare. According to his office, the Senator wants to begin meetings next week with the members (of both parties) of the Finance Committee and the Senate Health, Education, Labor and Pensions Committee – where Senator Kennedy (chairman of the HELP Committee) is expected to play a major role.

There are some things we can all agree on and use as valuable and non-partisan points of departure:

(1) “We cannot address the health care system, and leave a growing portion of the country behind. Though this must be a public and private sector mix.”

(2) “By making prevention the foundation of our health care system, we can spare patients needless suffering. We can avoid the high costs of treating an illness that has been allowed to progress.”

(3) “Health coverage is a shared responsibility and all should contribute.”

Note: These three quotes come directly from Senator Baucus' website.

The one thing we should all be able to agree upon is that there are no easy solutions … America’s SiCKO apologists notwithstanding.