Community For Affordable Health Care
Vol X, No 2, July, 2011
Transforming the $3 Trillion HealthCare Industry into Affordable HealthCare
By Utilizing the $2 Trillion Information Technology Industry
Through innovation by moving from a Vertical to a Horizontal industry
Thus eliminating $1 Trillion wasted
Insuring every American without spending the Extra $1Trillion Projected.
To purchase a copy of
the business plan, become an entrepreneur,
and changed the course of healthcare history, go to the bookstore at
In This Issue:
5. Lean HealthCare: Every industry is getting lean; we no longer have a choice.
The 1st Annual World Health Care Congress Latin America, October, 2011 in
São Paulo, Brazil
The World Health Care Congress (WHCC) convenes the most prestigious forum of global health industry executives and public policy makers. Building on the 8th annual event in the United States, the 7th annual event in Europe and the inaugural Middle East event, we are pleased to announce the 1st Annual World Health Care Congress - Latin America to be held in October, 2011 in São Paulo, Brazil.
This prominent international forum is the only conference in which over 500 leaders from all regions of Latin America will convene to address access, quality and cost issues, including Latin American health ministers, government officials, hospital/health system executives, insurance executives, health technology innovators, pharmaceutical, medical device, and supplier executives.
World Health Care Congress Latin America will address escalating challenges such as improving access to quality care, financing and insurance models for health care, driving innovation in health IT, promoting evidence-based medicine and clinical best practices. World Health Care Congress Latin America will feature a series of plenary keynotes, invitational executive Summits, in-depth working group sessions on emerging issues, as well as substantial business development and networking opportunities.
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A profoundly deceptive document that only marginally measured health-care performance at all.
The World Health Organization’s World Health Report 2000, which ranked the health-care systems of nearly 200 nations, stands as one of the most influential social-science studies in history. For the past decade, it has been the de facto basis for much of the discussion of the health-care system in the United States, routinely cited in public discourse by members of government and policy experts. Its most notorious finding—that the United States ranked a disastrous 37th out of the world’s 191 nations in “overall performance”—provided supporters of President Barack Obama’s transformative health-care legislation with a data-driven argument for swift and drastic reform, particularly in light of the fact that the U.S. spends more on health than any other nation.
In October 2008, candidate Obama used the
study to claim that “29 other countries have a higher life expectancy and 38
other nations have lower infant mortality rates.” On June 15, 2009, as he was
beginning to make the case for his health-care bill, the new president said:
“As I think many of you are aware, for all of this spending, more of our
citizens are uninsured, the quality of our care is often lower, and we aren’t
any healthier. In fact, citizens in some countries that spend substantially
less than we do are actually living longer than we do.” The perfect
encapsulation of the study’s findings and assertions came in a September 9,
2009, editorial in Canada’s leading newspaper, the Globe and Mail:
“With more than 40 million Americans lacking health insurance, another 25
million considered badly underinsured, and life expectancies and infant
mortality rates significantly worse that those of most industrialized Western
nations, the need for change seems obvious and pressing to some, especially
when the United States is spending 16 percent of
In fact, World Health Report 2000 was an intellectual fraud of historic consequence—a profoundly deceptive document that is only marginally a measure of health-care performance at all. The report’s true achievement was to rank countries according to their alignment with a specific political and economic ideal—socialized medicine—and then claim it was an objective measure of “quality.”
WHO researchers divided aspects of health care into subjective categories and tailored the definitions to suit their political aims. They allowed fundamental flaws in methodology, large margins of error in data, and overt bias in data analysis, and then offered conclusions despite enormous gaps in the data they did have. The flaws in the report’s approach, flaws that thoroughly undermine the legitimacy of the WHO rankings, have been repeatedly exposed in peer-reviewed literature by academic experts who have examined the study in detail. Their analysis made clear that the study’s failings were plain from the outset and remain patently obvious today; but they went unnoticed, unmentioned, and unexamined by many because World Health Report 2000 was so politically useful. This object lesson in the ideological misuse of politicized statistics should serve as a cautionary tale for all policymakers and all lay people who are inclined to accept on faith the results reported in studies by prestigious international bodies.
Before WHO released the study, it was commonly accepted that health care in countries with socialized medicine was problematic. But the study showed that countries with nationally centralized health-care systems were the world’s best. As Vincente Navarro noted in 2000 in the highly respected Lancet, countries like Spain and Italy “rarely were considered models of efficiency or effectiveness before” the WHO report. Polls had shown, in fact, that Italy’s citizens were more displeased with their health care than were citizens of any other major European country; the second worst was Spain. But in World Health Report 2000, Italy and Spain were ranked #2 and #7 in the global list of best overall providers.
Most studies of global health care before it concentrated on health-care outcomes. But that was not the approach of the WHO report. It sought not to measure performance but something else. “In the past decade or so there has been a gradual shift of vision towards what WHO calls the ‘new universalism,’” WHO authors wrote, “respecting the ethical principle that it may be necessary and efficient to ration services.”
The report went on to argue, even insist, that “governments need to promote community rating (i.e. each member of the community pays the same premium), a common benefit package and portability of benefits among insurance schemes.” For “middle income countries,” the authors asserted, “the policy route to fair prepaid systems is through strengthening the often substantial, mandatory, income-based and risk-based insurance schemes.” It is a curious version of objective study design and data analysis to assume the validity of a concept like “the new universalism” and then to define policies that implement it as proof of that validity.
The nature of the enterprise came more fully into view with WHO’s introduction and explanation of the five weighted factors that made up its index. Those factors are “Health Level,” which made up 25 percent of “overall care”; “Health Distribution,” which made up another 25 percent; “Responsiveness,” accounting for 12.5 percent; “Responsiveness Distribution,” at 12.5 percent; and “Financial Fairness,” at 25 percent.
The definitions of each factor reveal the ways in which scientific objectivity was a secondary consideration at best. What is “Responsiveness,” for example? WHO defined it in part by calculating a nation’s “respect for persons.” How could it possibly quantify such a subjective notion? It did so through calculations of even more vague subconditions—“respect for dignity,” “confidentiality,” and “autonomy.”
And “respect for persons” constituted only 50 percent of a nation’s overall “responsiveness.” The other half came from calculating the country’s “client orientation.” That vague category was determined in turn by measurements of “prompt attention,” “quality of amenities,” “access to social support networks,” and “choice of provider.”
Scratch the surface a little and you find that “responsiveness” was largely a catchall phrase for the supposedly unequal distribution of health-care resources. “Since poor people may expect less than rich people, and be more satisfied with unresponsive services,” the authors wrote, “measures of responsiveness should correct for these differences.”
Correction, it turns out, was the goal. “The object is not to explain what each country or health system has attained,” the authors declared, “so much as to form an estimate of what should be possible.” They appointed themselves determinants of what “should” be possible “using information from many countries but with a specific value for each country.” This was not so much a matter of assessing care but of determining what care should be in a given country, based on WHO’s own priorities regarding the allocation of national resources. The WHO report went further and judged that “many countries are falling far short of their potential, and most are making inadequate efforts in terms of responsiveness and fairness.”
Consider the discussion of Financial Fairness (which made up 25 percent of a nation’s score). “The way health care is financed is perfectly fair if,” the study declared, “the ratio of total health contribution to total non-food spending is identical for all households, independently of their income, their health status or their use of the health system.” In plain language, higher earners should pay more for health care, period. And people who become sick, even if that illness is due to high-risk behavior, should not pay more. According to WHO, “Financial fairness is best served by more, as well as by more progressive, prepayment in place of out-of-pocket expenditure. And the latter should be small not only in the aggregate but relative to households’ ability to pay.”
This matter-of-fact endorsement of wealth redistribution and centralized administration should have had nothing to do with WHO’s assessment of the actual quality of health care under different systems. But instead, it was used as the definition of quality. For the authors of the study, the policy recommendation preceded the research. Automatically, this pushed capitalist countries that rely more on market incentives to the bottom of the list and rewarded countries that finance health care by centralized government-controlled single-payer systems. In fact, two of the major index factors, Health Distribution and Responsiveness Distribution, did not even measure health care itself. They were both strictly measures of equal distribution of health and equal distribution of health-care delivery.
Perhaps what is most striking about the categories that make up the index is how WHO weighted them. Health Distribution, Responsiveness Distribution, and Financial Fairness added up to 62.5 percent of a country’s health-care score. Thus, almost two-thirds of the study was an assessment of equality. The actual health outcomes of a nation, which logic dictates should be of greatest importance in any health-care index, accounted for only 25 percent of the weighting. In other words, the WHO study was dominated by concerns outside the realm of health care.
Not content with penalizing free-market economies on the fairness front, the WHO study actually held a nation’s health-care system accountable for the behavior of its citizens. “Problems such as tobacco consumption, diet, and unsafe sexual activity must be included in an assessment of health system performance,” WHO declared. But the inclusion of such problems is impossible to justify scientifically. For example, WHO considered tobacco consumption equivalent, as an indicator of medical care, to the treatment of measles: “Avoidable deaths and illness from childbirth, measles, malaria or tobacco consumption can properly be laid” at a nation’s health-care door.”
From a political standpoint, of course, the inclusion of behaviors such as smoking is completely logical. As Samuel H. Preston and Jessica Ho of the University of Pennsylvania observed in a 2009 Population Studies Center working paper, a “health-care system could be performing exceptionally well in identifying and administering treatment for various diseases, but a country could still have poor measured health if personal health-care practices were unusually deleterious.” This takes on additional significance when one considers that the United States has “the highest level of cigarette consumption per capita in the developed world over a 50-year period ending in the mid-80s.”
At its most egregious, the report abandoned the very pretense of assessing health care. WHO ranked the U.S. 42nd in life expectancy. In their book, The Business of Health, Robert L. Ohsfeldt and John E. Schneider of the University of Iowa demonstrated that this finding was a gross misrepresentation. WHO actually included immediate deaths from murder or fatal high-speed motor-vehicle accidents in their assessment, as if an ideal health-care system could turn back time to undo car crashes and prevent homicides. Ohsfeldt and Schneider did their own life-expectancy calculations using nations of the Organisation for Economic Co-operation and Development (OECD). With fatal car crashes and murders included, the U.S. ranked 19 out of 29 in life expectancy; with both removed, the U.S. had the world’s best life-expectancy numbers (see table above).
But even if you dismiss all that, the unreliability of World Health Report 2000 becomes inarguable once you confront the sources of the data used. In the study, WHO acknowledged that it “adjusted scores for overall responsiveness, as well as a measure of fairness based on the informants’ views as to which groups are most often discriminated against in a country’s population and on how large those groups are” [emphasis added]. A second survey of about 1,000 “informants” generated opinions about the relative importance of the factors in the index, which were then used to calculate an overall score.
Judgments about what constituted “high quality” or “low quality” health care, as well as the effect of inequality, were made by people WHO called “key informants.” Astonishingly, WHO provided no details about who these key informants were or how they were selected. According to a 2001 Lancet article by Celia Almeida, half the responders were members of the WHO staff. Many others were people who had gone to the WHO website and were then invited to fill out the questionnaire, a clear invitation to political and ideological manipulation.
Another problem emerges in regard to the references used by the report. Of the cited 32 methodological references, 26 were from internal WHO documents that had not gone through a peer-review process. Moreover, only two were written by people whose names did not appear among the authors of World Health Report 2000. To sum up: the report featured data and studies largely generated inside WHO, with no independent, peer-reviewed verification of the findings. Even these most basic requirements of valid research were not met.
The report’s margin of error is similarly ludicrous in scientific terms. The margin for error in its data falls outside any respectable form of reporting. For example, its data for any given country were “estimated to have an 80 percent probability of falling within the uncertainty interval, with chances of 10 percent each of falling below the low value or above the high one.” Thus, as Whitman noted, in one category—the “overall attainment” index—the U.S. could actually rank anywhere from seventh to 24th. Such a wide variation renders the category itself meaningless and comparisons with other countries invalid.
And then there is the plain fact that much of the necessary data to determine a nation’s health-care performance were simply missing. The WHO report stated that data was used “to calculate measures of attainment for the countries where information could be obtained . . . to estimate values when particular numbers were judged unreliable, and to estimate attainment and performance for all other Member States.”
According to a shocking 2003 Lancet article by Philip Musgrove, who served as editor in chief of part of the WHO study, “the attainment values in WHO’s World Health Report 2000 are spurious.” By his calculation, the WHO “overall attainment index” was actually generated by complete information from only 35 of the 191 countries. Indeed, according to Musgrove, WHO had data from only 56 countries for Health Inequality, a subcategory; from only 30 countries for Responsiveness; and from only 21 countries for Fair Financing. Nonetheless, rankings were “calculated” for all 191 countries.
Musgrove gives specific examples of overtly deficient data that was directly misused by WHO. He stated that “three values obtained from expert informants (for Chile, Mexico, and Sri Lanka) were discarded in favor of imputed (i.e. estimated) values” and that “in two cases, informants gave opinions on one province or state rather than the entire country.” Musgrove wrote to Christopher Murray, WHO’s director of the Global Program on Evidence for Health Policy at the time, on August 30, 2000, about the study’s handling of the missing statistics: “If it doesn’t qualify as manipulating the data, I don’t know what does . . . at the very least, it gravely undermines the claim to be honest with the data and to report what we actually find.”
If World Health Report 2000 had simply been issued and forgotten, it would still be a case study in how to produce a wretched and unreliable piece of social science masquerading as legitimate research. That it served so effectively as a catalyst for unprecedented legislation is evidence of something more disturbing. The executive and legislative branches of the United States government used WHO’s document as an implicit Exhibit A to justify imposing radical changes to America’s health-care system, even in the face of objections from the American people. To blur the line between politics and objective analysis is to do violence to them both.
Despite the compelling studies that undermine this erroneous document, many government officials, policymakers, insurers, and academics have continued to use it to justify their ideology-based agenda, one that seeks centralized, government-run health care. Donald Berwick, later up for the position of Obama’s director of the Center for Medicare & Medicaid, used its questionable data to make a grand case against the U.S. health-care system in 2008: “Even though U.S. health-care expenditures are far higher than those of other developed countries, our results are no better. Despite spending on health care being nearly double that of the next most costly nation, the United States ranks thirty-first among nations on life expectancy, thirty-sixth on infant mortality, twenty-eighth on male healthy life expectancy, and twenty-ninth on female healthy life expectancy.” (This last bit came from updated 2006 WHO data.)
What we have here is a prime example of the misuse of social science and the conversion of statistics from pseudo-data into propaganda. The basic principle, casually referred to as “garbage in, garbage out,” is widely accepted by all researchers as a cautionary dictum. To the authors of World Health Report 2000, it functioned as its opposite—a method to justify a preconceived agenda. The shame is that so many people, including leaders in whom we must repose our trust and whom we expect to make informed decisions based on the best and most complete data, made such blatant use of its patently false and overtly politicized claims.
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remains gridlocked on many important issues but not every politician is afraid
to challenge the unsustainable growth of Medicaid. Consider S. 1031, by U.S.
Senator Tom Coburn.
This measure would increase local control over Medicaid spending and improve the incentives that have led politicians to trap ever more low-income citizens in poverty and the poor access to care that characterizes this top-heavy system.
Medicaid is often described as an “entitlement,” but that is wrongheaded. Medicaid is welfare, targeted at low-income Americans. And Medicaid should be easier to fix, politically, than two other troublesome programs.
The politicians who invented Social Security and Medicare asserted that these programs would be funded by payroll taxes in order to foster the illusion of entitlement. We pay for the benefits in our working years, and the benefits arrive after we’ve retired. It’s all nonsense of course.
The taxes we pay do not go into accounts that belong
to us. Rather, they pay current retirees and fund other government programs.
Nevertheless, it is exceedingly difficult to convince people of the truth that
we have not paid for our Social Security or Medicare. But Medicaid
spending, to which nobody is “entitled,” is now greater than Medicare spending.
This has occurred because Medicaid's funding formula incentivizes the political class to overspend. For every dollar a state politician spends on Medicaid, the federal government pitches in at least one dollar – or even more, as a result of the misnamed “stimulus” of 2009 – via the Federal Medical Assistance Percentage (FMAP). The federal government actually rewards states for making more residents dependent on Medicaid.
S.1031 would transform the federal government’s funding for Medicaid, but it would transform it into a “capped allotment.” This was the model of the successful welfare reform of 1996, which reformed Aid to Families with Dependent Children (AFDC) into Temporary Assistance to Needy Families (TANF).
The number of average monthly recipients dropped from more than 12 million in 1996 to fewer than 4 million in 2008 – and low-income Americans faced better incentives to seek productive work. We have recently experienced a successful example of a reform in this direction.
Rhode Island received a waiver on the last day of the Bush administration that capped its total (state and federal) Medicaid spending at $12.075 billion through 2013. At the current rate, it looks like the actual spending will be about $9.3 billion – with no evidence of reduced access to care. And Rhode Island’s waiver preserved the flawed FMAP.
Coburn’s S.1031 introduces even better incentives, from which all states and taxpayers will benefit. It gives states more control over their program dollars to get rid of waste, fraud, and abuse. It encourages states to make Medicaid providers accountable to the neediest patients in their communities, instead of remote federal bureaucracies. Finally, it will protect taxpayers from politicians’ worst impulses to spend unaccountably.
It is generally recognized that TANF, which passed with bipartisan support, produced positive outcomes. It is long past time to introduce similar reforms to Medicaid. The current stalemate on the debt limit should not prevent Congress from taking up S.1031 at the earliest convenience.
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This new section of Gesundheit! explores individual healthcare systems throughout Europe and analyses the landscape for reform. It begins by looking at the United Kingdom and assesses the National Health Service in light of radical proposals for change by the UK coalition government. Since 1948, patients in the United Kingdom have had free access to the National Health Service (NHS) – a fully public, single payer, universal healthcare system.
Upon its introduction, its chief architect, UK minister of health Aneurin Bevan, argued owerfully that “money ought not to be permitted to stand in the way of obtaining an efficient health service” and thus established the founding principle of the NHS: that it should exist free at the point of use. . .
The NHS is financed through mandatory payroll taxes that are paid by employees, whilst employers also contribute through national insurance payments. All citizens working in the UK are required to make these contributions if they are calculated as earning over a certain level per annum, currently set nationally at around £7,000 upwards for income tax. However, payment of such taxes is not a prerequisite for treatment in the NHS.
In fact, anyone who is a resident in the UK can access NHS services free at the point of use. One of the few exceptions to this, in addition to dental and optometry services outlined above, exists only in England for prescribed pharmaceuticals. English patients in the NHS are sometimes required to pay a fixed co-payment or prescription charge (currently £7.40), although this affects only around 10% of all pharmaceuticals prescribed in the NHS once a host of exemptions are taken into account. . .
In addition to moving commissioning powers to GPs, the planned reforms of the NHS will also introduce the principle that commissioners should be able to buy services from “any willing provider” so as to create greater competition between services. The idea is to facilitate a greater range of accredited providers, including those from the private sector, as opposed to formal tendering processes that can often restrict competition. . .
In truth, the plans to restructure the NHS are far from finalised and the government has recently decided to pause the legislative process, in the face of a wide range of criticism over their plans. In particular, opposition from key health professionals, such as the British Medical Association and the Royal College of Nursing, has created the impression that reforms are being undertaken without bringing key stakeholders onside. Furthermore, the promise to increase health spending in real terms until 2015 will also be difficult to maintain given current fiscal constraints and high inflation, although it is likely that this pledge will be honoured even at the expense of other priorities.
Government medicine does not give timely access to healthcare, it only gives access to a waiting list.
The radical proposals of the UK appear to be without significant vision.
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4. Government Healthcare and Other Entitlements: While the US Gov’t is insolvent, the states aren’t far behind
Next month will be pivotal for most states, as it marks the fiscal year end and is when balanced budgets are due. The states have racked up over $1.8 trillion in taxpayer-supported obligations in large part by underfunding their pension and other post-employment benefits. Yet over the past three years, there still has been a cumulative excess of $400 billion in state budget shortfalls. States have already been forced to raise taxes and cut programs to bridge those gaps.
Next month will also mark the end of the American Recovery and Reinvestment Act's $480 billion in federal stimulus, which has subsidized states through the economic downturn. States have grown more dependent on federal subsidies, relying on them for almost 30% of their budgets.
The condition of state finances threatens the economic recovery. States employ over 19 million Americans, or 15% of the U.S. work force, and state spending accounts for 12% of U.S. gross domestic product. The process of reining in state finances will be painful for us all.
The rapid deterioration of state finances must be addressed immediately. Some dismiss these concerns, because they believe states will be able to grow their way out of these challenges. The reality is that while state revenues have improved, they have done so in part from tax hikes. However, state tax revenues still remain at roughly 2006 levels.
Expenses are near the highest they have ever been due to built-in annual cost escalators that have no correlation to revenue growth (or decline, as has been the case recently). Even as states have made deep cuts in some social programs, their fixed expenses of debt service and the actuarially recommended minimum pension and other retirement payments have skyrocketed. While over the past 10 years state and local government spending has grown by 65%, tax receipts have grown only by 32%.
Off balance sheet debt is the legal obligation of the state to its current and past employees in the form of pension and other retirement benefits. Today, off balance sheet debt totals over $1.3 trillion, as measured by current accounting standards, and it accounts for almost 75% of taxpayer-supported state debt obligations. Only recently have states been under pressure to disclose more information about these liabilities, because it is clear that their debt burdens are grossly understated.
Since January, some of my colleagues focused exclusively on finding the most up-to-date information on ballooning tax-supported state obligations. This meant going to each state and local government's website for current data, which we found was truly opaque and without uniform standards.
What concerned us the most was the fact that fixed debt-service costs are increasingly crowding out state monies for essential services. For example, New Jersey's ratio of total tax-supported state obligations to gross state product is over 30%, and the fixed costs to service those obligations eat up 16% of the total budget. Even these numbers are skewed, because they represent only the bare minimum paid into funding pension and retirement plans. We calculate that if New Jersey were to pay the actuarially recommended contribution, fixed costs would absorb 37% of the budget. New Jersey is not alone.
The real issue here is the enormous over-leveraging of taxpayer-supported obligations at a time when taxpayers are already paying more and receiving less. In the states most affected by skyrocketing debt and fiscal imbalances, social services continue to be cut the most. Taxpayers have the ultimate voting right—with their feet. Corporations are relocating, or at a minimum moving large portions of their businesses to more tax-friendly states.
Boeing is in the political cross-hairs as it is trying to set up a facility in the more business-friendly state of South Carolina, away from its current hub of Washington. California legislators recently went to Texas to learn best practices as a result of a rising tide of businesses that are building operations outside of their state. Over time, individuals will migrate to more tax-friendly states as well, and job seekers will follow corporations.
Fortunately, many governors are addressing their state's structural deficits head on. Unfortunately, there is a lack of collective appreciation for how painful this process will be. Defaults in a variety of forms by states and municipalities are already happening and more are inevitable. Taxpayers have borne the initial brunt of these defaults by paying higher taxes in exchange for lower social services. And state and local government employees are having to renegotiate labor contracts that they once believed were sacrosanct.
Municipal bond holders will experience their own form of contract renegotiation in the form of debt restructurings at the local level. These are just the facts. The sooner we accept them, the sooner we can get state finances back on track, and a real U.S. economic recovery underway.
Ms. Whitney is CEO of Meredith Whitney Advisory Group LLC.
Government is not the solution to our problems, government is the problem.
- Ronald Reagan
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5. Lean HealthCare: Every industry is getting lean; we no longer have a choice.
David J. Gibson, M.D.
Director, Clearway Health Solutions
You may have missed reading a thought provoking article from Thomas Freedman in the NYT yesterday. The article entitled Average Is Over (see attached below), is particularly relevant as it relates to the political debate that is evolving with a trajectory that is progressively being divorced from reality. All the politicians are promising jobs, jobs, jobs. Obama wants more government spending to bring back jobs as demonstrated in his SOTU speech last night. The Republicans are promising that the market will return jobs if the government is downsized and taxes are lowered. What happens when both are proven to be wrong which will become evident soon after the election later this year? It is not a pretty picture to contemplate.
The following are a couple of excerpts from Freedman’s article:
“In the 10 years ending in 2009, [U.S.] factories shed workers so fast that they erased almost all the gains of the previous 70 years; roughly one out of every three manufacturing jobs — about 6 million in total — disappeared.”
Most of the current job creation is now focused in the relative low paying and previously non-exportable service sector. Hospitality jobs such as waiters and waitresses are an example. Now, these jobs can be exported to the IT sector. Consider the following”
Last April, Annie Lowrey of Slate wrote about a start-up called “E la Carte” that is out to shrink the need for waiters and waitresses: The company “has produced a kind of souped-up iPad that lets you order and pay right at your table. The brainchild of a bunch of M.I.T. engineers, the nifty invention, known as the Presto, might be found at a restaurant near you soon. ... You select what you want to eat and add items to a cart. Depending on the restaurant’s preferences, the console could show you nutritional information, ingredients lists and photographs. You can make special requests, like ‘dressing on the side’ or ‘quintuple bacon.’ When you’re done, the order zings over to the kitchen, and the Presto tells you how long it will take for your items to come out. ... Bored with your companions? Play games on the machine. When you’re through with your meal, you pay on the console, splitting the bill item by item if you wish and paying however you want. And you can have your receipt e-mailed to you. ... Each console goes for $100 per month. If a restaurant serves meals eight hours a day, seven days a week, it works out to 42 cents per hour per table — making the Presto cheaper than even the very cheapest waiter.”
This is relevant within the context of our unleashing market forces within the health care sector of the economy. Informed consumers, as has been demonstrated in every other sector of the economy, will predictably reform the industry and drive creative destruction that has been avoided in the past for all the reasons we have previously discussed. The provider cost per unit of service will be quickly reduced in order to compete in a competitive market. The use of IT to increase productivity will become an imperative. The resulting loss of HC jobs and the reduction in compensation will be an assault on one of the last relatively affluent job option within today’s U.S. economy.
This message is not intended to argue against our introducing available market consumer forces into the HC industry. This will occur with or without our involvement. Rather, I am speculating on the collateral unintended effect that this fundamental shift in the industry’s structure and organization will have on the general economy.
David J. Gibson, M.D.
Clearway Health Solutions
AVERAGE IS OVER
By THOMAS L. FRIEDMAN, NYT | January 24, 2012
In an essay, entitled “Making It in America,” in the latest issue of The Atlantic, the author Adam Davidson relates a joke from cotton country about just how much a modern textile mill has been automated: The average mill has only two employees today, “a man and a dog. The man is there to feed the dog, and the dog is there to keep the man away from the machines.”
Davidson’s article is one of a number of pieces that have recently appeared making the point that the reason we have such stubbornly high unemployment and sagging middle-class incomes today is largely because of the big drop in demand because of the Great Recession, but it is also because of the quantum advances in both globalization and the information technology revolution, which are more rapidly than ever replacing labor with machines or foreign workers.
In the past, workers with average skills, doing an average job, could earn an average lifestyle. But, today, average is officially over. Being average just won’t earn you what it used to. It can’t when so many more employers have so much more access to so much more above average cheap foreign labor, cheap robotics, cheap software, cheap automation and cheap genius. Therefore, everyone needs to find their extra — their unique value contribution that makes them stand out in whatever is their field of employment. Average is over. . .
What the iPad won’t do in an above average way a Chinese worker will. Consider this paragraph from Sunday’s terrific article in The Times by Charles Duhigg and Keith Bradsher about why Apple does so much of its manufacturing in China: “Apple had redesigned the iPhone’s screen at the last minute, forcing an assembly-line overhaul. New screens began arriving at the [Chinese] plant near midnight. A foreman immediately roused 8,000 workers inside the company’s dormitories, according to the executive. Each employee was given a biscuit and a cup of tea, guided to a workstation and within half an hour started a 12-hour shift fitting glass screens into beveled frames. Within 96 hours, the plant was producing over 10,000 iPhones a day. ‘The speed and flexibility is breathtaking,’ the executive said. ‘There’s no American plant that can match that.’ ” . . .
The Future of Health Care Has to Be Lean, Efficient and Personal.
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Occupy Wall Street
By Dr. Thomas Sowell
The current Occupy Wall Street movement is the best illustration to date of what President Barack Obama's America looks like. It is an America where the lawless, unaccomplished, ignorant and incompetent rule. It is an America where those who have sacrificed nothing pillage and destroy the lives of those who have sacrificed greatly.
It is an America where history is rewritten to honor dictators, murderers and thieves. It is an America where violence, racism, hatred, class warfare and murder are all promoted as acceptable means of overturning the American civil society.
It is an America where humans have been degraded to the level of animals: defecating in public, having sex in public, devoid of basic hygiene.
It is an America where the basic tenets of a civil society, including faith, family, a free press and individual rights, have been rejected.
It is an America where our founding documents have been shredded and, with them, every person's guaranteed liberties.
It is an America where, ultimately, great suffering will come to the American people, but the rulers like Obama, Michelle Obama, Harry Reid, Nancy Pelosi, Barney Frank, Chris Dodd, Joe Biden, Jesse Jackson, Louis Farrakhan, liberal college professors, union bosses and other loyal liberal/Communist Party members will live in opulent splendor.
It is the America that Obama and the Democratic Party have created with the willing assistance of the American media, Hollywood, unions, universities, the Communist Party of America, the Black Panthers and numerous anti-American foreign entities.
Barack Obama has brought more destruction upon this country in four years than any other event in the history of our nation, but it is just the beginning of what he and his comrades are capable of.
The Occupy Wall Street movement is just another step in their plan for the annihilation of America.
"Socialism, in general, has a record of failure so blatant that only an intellectual could ignore or evade it."
Thanks to Dr. Loofbourow for bringing this to our attention. 11-13-11
Regulations under Obama will worsen not only Freedom, but Quality of HealthCare.
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New Whispers of Perry 2012 Bid for the White House
But over the past two weeks, political advisers and friends say, Mr. Perry has changed his tune on a possible presidential campaign. In private conversations, they say, the three-term governor said he worries that the current GOP contenders have yet to stir real excitement within the party and may struggle when facing President Barack Obama.
In these conversations, the governor has emphasized his own track record in bringing jobs to Texas, which has created more jobs than any other state in recent years. That success, he has told supporters, would position him well in an election that will likely pivot on jobs.
The conversations add detail on Mr. Perry's thinking. He generated political buzz two weeks ago when he told reporters he planned to "think about" a presidential run after the Memorial Day weekend. He added, with a smile, "But I think about a lot of things."
In these conversations, the governor has emphasized his own track record in bringing jobs to Texas, which has created more jobs than any other state in recent years. That success, he has told supporters, would position him well in an election that will likely pivot on jobs.
The conversations add detail on Mr. Perry's thinking. He generated political buzz two weeks ago when he told reporters he planned to "think about" a presidential run after the Memorial Day weekend. He added, with a smile, "But I think about a lot of things." . . .
At the same time, Mr. Perry, 61 years old, is making a number of national appearances this month, including an address next week to an annual dinner of the New York Republican Party. Last week he announced an August summit in Houston and invited all the nation's governors to attend. He described the event as a "day of prayer and fasting" focused on "the healing of our country."
A former Air Force pilot, Mr. Perry served six years in the Texas state legislature before becoming the state agriculture commissioner. He was lieutenant governor for one year before taking over as governor when his predecessor, George W. Bush, became president in 2001.
Mr. Perry has recently built a base among tea-party groups and conservatives by hammering on state's rights and attacking the Obama administration for its health-care overhaul and interventions in the economy. This year, he backed an array of measures appealing to social conservatives, including a requirement that all women considering an abortion have a sonogram first. . .
Mr. Perry's record has brought him raves from the likes of Rush Limbaugh, who told his national radio audience last month that if Mr. Perry jumps in, "it's a brand-new day, and it starts all over again."
Few dispute that assessment. "There is no question if he got in the race he would change the dynamic very quickly," said Henry Barbour, a prominent GOP operative and nephew of Mississippi GOP Gov. Haley Barbour. "He is central casting, he can raise the money, and he has deep ties with the grass-roots." . . .
Read the entire article on Rick Perry in the WSJ, subscription is required . . .
What the Governors are Telling Congress?
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5 steps to consider for making the most of Telehealth
Michelle McNickle | Web Content Producer | January 20, 2012
Telehealth services offer substantial opportunities for healthcare cost savings, as well as a proven effectiveness with improving patient care, particularly in rural areas. However, to get the most bang for the buck, there is still much work that needs to be done.
“With the widespread adoption of EMRs, digital health records provide physicians/clinicians with the remote monitoring capabilities to communicate with their patients,” said Fred Pennic, founder of HIT Consultant and senior advisor at Aspen Advisors.
This remote access to care saves time and money by allowing physicians to work with more patients and by cutting out travel expenses for people in rural areas — many of whom find travel to be a financial and physical hardship.
Pennic believes there are some key endeavors that need to take place for the full positive effects of telehealth medicine to be felt. He offers this food for thought: Read food for thought. . .
1. Establish an incentive-based program. According to Pennic, sustainable funding is vital to the successful, widespread adoption of telehealth. “Creating more incentive-based programs or grants will provide agencies and other organizations with the funding necessary to overcome the start-up costs associated with implementing such initiatives,” he said. Recent research has proven the potential cost savings of such initiatives can be substantial, making the case for incentive-based programs to get telehealth initiatives up and running that much stronger. For example, after evaluating a telehealth program, researchers at Stanford University, found spending reductions of approximately 7.7 percent to 13.3 percent, or $312 to $542 per person per quarter.
2. Develop the infrastructure. “Having adequate infrastructures [in place] to support these initiatives are imperative,” said Pennic. Infrastructure is the “heart of telehealth,” he said, and includes investing in equipment such as fiber optics, broadband/wireless coverage, video, computer, voice and imaging.
3. Improve telehealth reimbursements. As it stands legislatively, said Pennic, there’s no universal reimbursement policy among public and private sectors governing the reimbursement of telehealth services — something he believes is imperative to its widespread adoption and success. “Current payment for telemedicine services, such as offsite reading of medical images, includes Medicaid, Medicare, employers and private insurers,” he said. “However, payment is limited for interactive consultations and chronic-care patients.”
[See also: Telehealth services make business sense.]
4. Foster user acceptance and confidence in telehealth. “Perhaps the greatest challenge in telehealth is increasing the user acceptance of technology, for both clinicians and patients who aren’t tech savvy,” said Pennic. Ideally, he said, successful telehealth programs must be able to easily integrate the telehealth process into healthcare and patient environments seamlessly. And although we know the federal Medicare program for seniors and disabled Americans doesn’t currently reimburse for telehealth and home monitoring services, a recent article is saying that could quickly change due to the upswing and acceptance of telehealth programs In fact, according to Dr. Joseph Kvedar, director of the Center for Connected Health at Partners Healthcare in Boston, the future is “quite bright” for payment and reimbursement programs. Statics have proven telehealth’s effectiveness, the article states, with confidence in its ability to reduce readmission rates growing.
5. Allocate resources and time. In addition to meeting technology requirements, said Pennic, successful telehealth programs must have the proper allocated resources and time necessary to ensure its widespread adoption. “People and processes are the key components to effective telehealth utilization,” he said. Agreeing with Pennic is Laurence C. Baker, PhD, a professor of health research and policy at Stanford. After studying a Healthy Buddy telehealth program, which was used by Medicare patients in the Northwest, he found two main aspects played most into its success: the first being the “tight” integration of information and care management, and the second was the device itself, which was patient-friendly and easy to use.
Follow Michelle McNickle on Twitter, @Michelle_writes
The research from HPUSA has elucidated some important clinical statistics to control health care costs. This data is hard to obtain and cannot be automated. It is labor intensive. At this point it is clinical: one on one. When we see large expenditures in health care, we try to determine if the patient is a candidate to be included in our series. We then indulge in a frank discussion of his or her responses to the questions concerning percentage co-payment and its effect on the patient’s utilization of health care benefits.
Health care can be stratified into a number of logical tiers. The most expensive and highly sophisticated care is in the traditional acute care hospital. We came up with a 10 percent co-payment of the hospital costs as being the best number that did not preclude needed care and was able to allow for needed hospital care. With a 10 percent co-payment, the patient policed his hospital cost better than any oversight institution saving up to 40 percent of usual costs.
The traditional hospital is like the
mainframe computer industry of the third quarter of the twentieth century. It
became a costly and unmanageable structure. It was salvaged by the competition
of the PC industry which made the mainframe industry adapt before essentially
The free standing urgent care centers and the surgi-centers are similar to the PC industry causing a restructuring of health care. For purposes of making health care affordable, which in turn will make health insurance affordable, out research indicates that a 20 percent co-payment for these centers was the best number that did not preclude needed care and was not too large so as to prevent needed care.
Hospitals reacted immediately and forcefully by purchasing these centers or building competing surge-centers. In fact the surgeons that owned a surgi-center near our office were told by the hospital that they would like to purchase their surgi-center or they would build a competing surgi-center across the street from them. The surgeons obviously cashed in their investment and re-established a new surgi-center not nearby any hospitals and are operating successfully.
This continues the migration from the vertically integrated healthcare structure to the horizontal competitive healthcare structure. This will occur over time and there is nothing that hospitals can do to stop this restructuring.
. . . the triple play of the internet, entrepreneurship, and individual capitalism is an unstoppable force around the world, and that Individual Capitalism is the force that will shape the 21st Century.—Entrepreneur Country Manifesto.
Medicine and Liberty - Network of Liberty Oriented
Doctors, www.MedLib.ch/, Alphonse Crespo, MD,
Executive Director and Founder
Medicine & Liberty (MedLib) is an independent physician network founded in 2007, dedicated to the study and advocacy of liberty, ethics & market in medical services.
- We support professional autonomy for doctors and liberty of choice for patients
- We uphold the Hippocratic covenant that forbids action harmful to the patient
- We defend responsible medical practice and access to therapeutic innovation free from
- We work towards a deeper understanding of the role and importance of liberty & market in
MedLib is part of a wide movement of ideas that defends
- the self-ownership principle & the property rights of individuals on the products of their
physical and intellectual work
- free markets, free enterprise and strict limits to the role of the State
Reason Foundation: http://reason.com/about: Reason and Reason Online are editorially independent publications of the Reason Foundation, a
national, non-profit research and educational organization.
Reason is the monthly print magazine of "free minds and free markets." It covers politics, culture, and ideas through a provocative mix of news, analysis, commentary, and reviews. Reason provides a refreshing alternative to right-wing and left-wing opinion magazines by making a principled case for liberty and individual choice in all areas of human activity.
Reason Online is updated daily with articles and columns on current development in politics and culture. . It also contains the full text of past issues of the print edition of Reason. Reason Online is entirely free.
· Entrepreneur-Country. Julie Meyer, CEO of Ariadne Capital, (Sorry about the nepotism, but her message is important) recently launched Entrepreneur Country. Read their manifesto for information: 3. The bigger the State grows, the weaker the people become - big government creates dependency . . . 5. No real, sustainable wealth creation through entrepreneurship ever owed its success to government . . . 11. The triple play of the internet, entrepreneurship, and individual capitalism is an unstoppable force around the world, and that Individual Capitalism is the force that will shape the 21st Century . . . Read the entire manifesto . . .
· Americans for Tax Reform, www.atr.org/, Grover Norquist, President, keeps us apprised of the Cost of Government Day® Report, Calendar Year 2008. Cost of Government Day (COGD) is the date of the calendar year on which the average American worker has earned enough gross income to pay off his or her share of spending and regulatory burdens imposed by government on the federal, state and local levels. Cost of Government Day for 2008 was July 16th, a four-day increase above last year's revised date of July 10th. With July 16th as the COGD, working people must toil on average 197 days out of the year just to meet all the costs imposed by government. In other words, the cost of government consumes 53.9 percent of national income. If we were to put health care into the public trough, the additional 18 percent would allow the government to control 70 percent or nearly three-fourths of our productivity and destroy our health care in the process. We would have almost no discretionary income.
· National Taxpayer's Union, www.ntu.org/main/, Duane Parde, President, keeps us apprised of all the taxation challenges our elected officials are trying to foist on us throughout the United States. To find the organization in your state that's trying to keep sanity in our taxation system, click on your state at www.ntu.org/main/groups.php. August 13 you can working for yourself. It takes nearly 8 months of hard work for every American to pay for the cost of government. Read more . . .
Since 1984, Citizens Against Government Waste has been the resource that policymakers, media, and the taxpaying public rely on for the bottom line behind today's headlines. Waste News is the first stop for reporters covering government spending. Members of the Media visit our media page to sign up for email updates or to set up interviews with CAGW policy experts.
· Evolving Excellence—Lean Enterprise Leadership. Kevin Meyer, CEO of Superfactory, (Sorry about the nepotism, but his message is important) has started a newsletter which impacts health care in many aspects. Join his evolving excellence blog . . . Excellence is every physician’s middle name and thus a natural affiliation for all of us. This month read his The Customer is the Boss at FAVI “I came in the day after I became CEO, and gathered the people. I told them tomorrow when you come to work, you do not work for me or for a boss. You work for your customer. I don’t pay you. They do. . . . You do what is needed for the customer.” And with that single stroke, he eliminated the central control: personnel, product development, purchasing…all gone. Looks like something we should import into our hospitals. I believe every RN, given the opportunity, could manage her ward of patients or customers in similar lean and efficient fashion.
· Ayn Rand, a Philosophy for Living on Earth, www.aynrand.org/site/PageServer, is a veritable storehouse of common sense economics to help us live on earth. To review the current series of Op-Ed articles, some of which you and I may disagree on, go to www.aynrand.org/site/PageServer?pagename=media_opeds
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Each year our nation’s outstanding high school students are studied to see what makes them outstanding. This year Who’s Who conducted a study of their parents in an effort to discover what made these young people standout students . . . Two thousand parents were surveyed, and most had inspired their children with the imperatives of good education, work and respect for authority. In a word, today’s star students come from “old-fashioned” homes. Old-fashioned only in that they reflect hard work, self-reliance, respect for family and community—in a phrase: “family values.” –Paul Harvey 1992
A FEW bullets were enough. But the shots that killed Osama bin Laden in the dead of night on May 2nd in a fortified compound not far from Islamabad came after 15 years of dogged pursuit, two long wars in Iraq and Afghanistan, well over $1 trillion of spending and around150,000 deaths. It is a heavy reckoning for one man’s life. . .
Mr bin Laden matters because he swept up a ragbag of local grievances into a brand of intoxicating and violent jihad with worldwide pretensions. His vision, however impractical, of purging Islam and establishing a single Islamic caliphate appealed to Muslims disgusted by the venality of their own elites. His means of bringing it about embraced an orgy of murder and martyrdom partly directed against the “Crusader” West, particularly America. Sad to say, that also appealed to many Muslims for a while. And the whole package was decked with the riches-to-rags story of Mr bin Laden himself—a man who had given up power and wealth in Saudi Arabia, lived simply and seemed almost charmed in his capacity to defy the mightiest army in history (see Obituary).
Terrorists dream of setting the agenda, and in two ways Mr bin Laden succeeded beyond imagination. For many people, especially non-Muslims, the central place he reserved for violence tainted the whole of Islam. Even as Westerners came to fear bloodthirsty and barbaric Muslims, Muslims deplored degenerate and imperialist Christians. Mr bin Laden’s brand of hatred thrived on both those grotesque stereotypes.
And by framing the fight as a clash of civilisations, he could draw the West into a global war on terror. The attacks of September 11th 2001 tipped America and the West into a fight that exacted a terrible price in blood and treasure. At home, America has diverted vast resources into a security bureaucracy. Abroad, it has been distracted from the historic challenge that American power faces in Asia. . .
Today, we have a memorable reminder of the sad fact that freedom means different things to different people. Today is the anniversary of the beginning of the Battle of Gettysburg in 1863, a battle memorable both for the bravery and dedication of those who fought it and for its role as a turning point in the Civil War. The Battle of Gettysburg, as Abraham Lincoln said a few months later, must be remembered so that from its honored dead “we take increased devotion to that cause for which they gave the last full measure of Devotion.” In the largest sense, that case was, again as Lincoln said, “that government of the people, by the people, for the people shall not perish from the earth.”
Medicare went into effect in the United States on this date in 1966. Many well-to-do seniors paid for their private health insurance for some years and finally succumb to become enslaved to the government for their most personal privacy. In 1970, my father finally gave up paying his Blue Cross/Blue Shield and White Cross policies premiums and sadly just had Medicare. He felt sad for his adopted country that his parents sought freedom from the Father of government social insurance, German Chancellor Otto von Bismarck in 1866. As with any entitlement, there is never an objective appraisal of what alternatives would have kept our nation from enslaving themselves, our children and our grandchildren. Charles Ponzi, Bernard Ebbers, Enron, Lou Pearlman, Ivan Boesky, Michael Millikin, Dr. Bill McGuire, Bernard Madoff, ($65 billion), PG & E, and others were mere pikers compared to the grandiose Ponzi schemes that Roosevelt, and Johnson pulled off in 1933 and 1966. It took Reagan and 30 years to reverse the process of living on our children and grandchildren’s future. Will it take another 30 years to survive the current administration’s Ponzi Scheme of $ trillions that will outdo Roosevelt & Johnson combined and also enslave us? Or will we fade into the history of human misery, ourselves being subject to the devastations perpetrated by Kings, Emperors, Dictators, Czars, and other Ruthless Rulers. We could fade into slavery by not even firing a shot or giving serious resistance. What a tragedy as a result of becoming so comfortable with our freedom that we failed to understand the daily risks. Will we become so comfortable with our enslavement, like the people of Russia when Communism was overthrown? Some of them actually wished for the return of the dictator who told them when and where to buy their daily bread, even if it was only once a week. Starvation was more comfortable and secure to them than freedom.
Remember: Chancellor Otto von Bismarck, the father of socialized medicine in Germany, recognized in 1861 that a government gained loyalty by making its citizens dependent on the state by social insurance. Thus socialized medicine, or any single payer initiative, was born for the benefit of the state and of a contemptuous disregard for people's welfare.
Thus we must also remember that ObamaCare has nothing to do with appropriate healthcare; it was similarly projected to gain loyalty by making American citizens dependent on the government and eliminating their choice and chance in improving their welfare or quality of healthcare. Socialists know that once people are enslaved, freedom seems too risky to pursue.