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July 19, 2005

POLICY/POLTICS: Why Hillarycare failed...and what we need to learn from that failure

This is the continuation of an article I've threatened THCB readers with for some time about what in my view really happened the last time we got serious about health care reform.  And in it there are lessons for what we should do when the opportunity next comes up. (It's also really long, so for the first time over here I've continued it "below the fold")

There are lots of versions about what killed the 1993-4 health care reform effort.  Hillary Clinton has now decided that the problem was the lack of incrementalism in her plan.  Last week the New York Times said that since becoming a Senator:

She has deliberately avoided the major mistake she made as first lady, namely trying to sell an ambitious plan to a public with no appetite for radical change. <SNIP>. She summed up her approach in the first floor speech she delivered in the Senate about four years ago, when she unveiled a series of relatively modest health care initiatives. "I learned some valuable lessons about the legislative process, the importance of bipartisan cooperation and the wisdom of taking small steps to get a big job done," she said, referring to the 1994 defeat of her health care plan.

On the other hand, some people are still claiming victory for the plan's defeat even if they were at most modest bit players.  Here's what one fawning bio says about former New York Lt Governor Betsy McCaughey

A 35-year-old senior fellow named Elizabeth McCaughey...wrote an article for The New Republic on what she discovered in a close reading of the 1,431-page document containing the Clinton Health Care Plan: Namely, that it would put every citizen in a single government-operated HMO. That one article shot down the entire blimp, and Betsy McCaughey became a 35-year-old Cinderella. One of the richest men in America chose her as his wife, and George Pataki made her lieutenant governor of New York.

Ignoring the fact that McCaughey spent her time thereafter putting poor New Yorkers into those HMOs she so despised, and then went off the deep end en route to divorce from Pataki, the rich guy, and reality (not necessarily in that order), it's not really true that one article in The New Republic can be quite that influential. (Sorry Jon!).  Even if the overly geeky Clintonistas in the White House did feel that they had to come out with a point by point rebuttal. And anyway, the article only came out in January 1994 by which time the die was more or less cast the other way. Again we have to look elsewhere for the explanation.

If you want to go back and spend a few minutes wallowing in the era of trial balloons and secret task forces, there's a very interesting time line of the whole process on the NPR website, as well as a briefer information over at the Clinton Health Plan Wikipedia site. It seems like there was a moment when it could have succeeded, and indeed there may well have been. What has been missing from the whole discussion over multiple blogs over the last couple of months has been the understanding that there's a real world outside Washington and that sometimes (but not too often) what's going on there has an impact inside the beltway.

The debate over health care had been building for quite a while by the time of the 1992 election even though it wasn't a big factor in the Clinton victory. Harris Wofford had won a Senate seat in 1991 in Pennsylvania with some slogan about the right of every American to go to a doctor. And the debate was being picked up amongst the SCLM elite, with the NY times having several articles about it. In fact my only ever mention on the front (or any other page) of the NY Times (as the third banana author of a piece on Japanese health care) came in very late 1992. That was one of many tiny indications that the discussion about what was wrong with American health care which had been brewing in academia for some time, was starting to come to the notice of the politicos.

So why was that debate becoming politically important? The answer was recession and middle-class insecurity. The recession of 1991-2 was brief but deep and somewhat local (centered around Los Angeles -- remember "Falling Down"?)....and it was the first time that a significant number of white collar workers were asked to pay towards their health benefits. It was also the second time that heath care costs rapidly went up much faster than economic growth (the first time was in the Reagan recession of the early 1980s) which woke up employers, and it was the first time that Americans were being put into managed care plans by their employers. But by far the most important factor was the fear that no job meant no health insurance.  And even though the recession in fact was over by the end of the election season, the carry-over effect of the "no job = no health care" fear went on into 1993.

Clinton was not elected to change the health care system -- the slogan was "It's the economy, stupid!". But rational wonk that he was, when he started to look at the economy and the rate of growth of the health care sector, he realized that he had found the biggest problem, and he set out to fix it. But he wasn't really a wonk about health care, and neither was Hillary. So after the election they decided that they had to study the problem first and then come up with a solution. As a more recent opportunist politician would say, Beeg mistake!

Instead what was important was the opportunity given to the reformer crowd by the recession. Harris has asked questions about Americans' attitude to the health care system since 1982. They published a historical retrospective a couple of years back which I urge you to read if you only click on one link in this post. The proportion saying that the system needed to be completely rebuilt (the most negative of 3 choices) went from 19% in 1987 to 24% in 1989 (via a weirdly high 29% in 1988) to 42% in 1991. There's always a big group in the middle looking for "fundamental change", but the fact that 42% were looking for a complete rebuilding meant that there was an appetite for something real to be done.  But of course there was only so much of a window, and as the economy picked up by 1993 the number was down to the mid-30%s where it basically stayed until the boom of the 1990s took health care off the radar and it fell to hover around 30% and below.  (Note of course the 30% is still a pretty high number and a much higher "base of dissatisfaction" to start from when we have the next debate).

While they should have been petrified about the gradual reduction in concern around the "no job = no health care" issue, Hillary and Ira Magaziner basically ignored 15 years worth of study about what was wrong with the health care system and spent 4-6 months fact-finding. Clinton's address to Congress about health care, the most important issue of his Presidency not involving interns and blue dresses, was not until  September 23, 1993--Nine full months after he came to office . (That was the speech when the wrong one was loaded into the teleprompter, but he aced it anyway)

While there was some optimism in the immediate aftermath of the speech, nothing got done and politically everything was going to pot. Paul Starr, the Princeton professor who ended up being the ideological parent of the Clinton plan published his version of reality in an article called called What Happened to Health Care Reform?. In the middle of that article he got somewhere near to the truth

With unemployment down, Americans were worrying less about their jobs and health coverage and more about crime. As health care inflation eased primarily because inflation was generally under control, businesses worried less about health care cost containment and more about the political implications of an expansion of government authority. Under these conditions, the ideological and interest-group opponents of reform were able to change the subject. Instead of health care, the focus of debate became government, which was a debate we were sure to lose.

It didn't help that the Clinton's taskforce had mystified and excluded even potential allies.  For example the whole thing was supposed to be an employer mandate based on managed competition a la Enthoven. Sara Singer in Enthoven's office told me that by putting Medicaid into the Regional Health Alliances, the Clinton plan would kill the employer risk pool and become de facto single payer. I didn't see too much wrong with that as a policy but it was enough for Enthoven to declare that all 1400 plus pages of the plan should be ripped up. So without the ideological father of managed competition, it's not surprising the the Jackson Hole Group and the employers they carried with them wouldn't sign on. And, of course, because of the employer mandate the small employers (including the doctors) and smaller insurers were always going to be opposed, hence the Harry and Louise campaign of late 1993. When it came out around that time that they were going to pay for the plan by cutting Medicare and Medicaid reimbursements, they lost the doctors and providers, and it was all over bar the shouting.

By December 1993 Harvard pollster Bob Blendon was telling the corporate clients we worked with that the only way to save the plan was for Bill to sack Hillary and Ira, and like the Palestinian-Israeli peace process (remember that?) he should take a few trusted Senators to a Norwegian hotel and let them come up with a whole new bill. Magaziner and Hillary continued to press forward, but the meeting in the Norwegian Hotel never came about.

Of course the delays and all the other scandals like Whitewater, Vince Foster, and the various fluffed appointments and nannygates -- not to mention the stress of getting the budget passed in 1993, took away attention from the health care reform initiative. But the key point was that a plan as detailed as that coming out of the task force was never going to be more than a first offer, and that it never needed all that time in preparation. or all that detail.  Clinton's six simple principles for health reform, that he announced in the September speech, would have sufficed in February 1, 2003. By the time he tried to bargain away universal coverage in mid-2004 it was too little too late.

Compare and contrast with how a real political operative got stuff done. Here's a description of the Medicare Act passage, also passed with a Democratic President, House and Senate.

This act was signed into law by President Lyndon Johnson on July 30, 1965, in Independence, MO. It established Medicare, a health insurance program for the elderly, and Medicaid, a health insurance program for the poor.

In 1965, the passage of the Social Security Act Amendments, popularly known as Medicare, resulted in a basic program of hospital insurance for persons aged 65 and older, and a supplementary medical insurance program to aid the elderly in paying doctor bills and other health care bills. It was funded by a tax on the earnings of employees, matched by contributions by employers, and was well received. In the first three years of the program, nearly 20 million beneficiaries enrolled in it.

Debate over the program actually began two decades earlier when President Harry S. Truman sent a message to Congress asking for legislation establishing a national health insurance plan. At that time, vocal opponents warned of the dangers of “socialized medicine.” By the end of the Truman’s administration, he had backed off from a plan of universal coverage, but administrators in the Social Security system and others began to focus on the idea of a program aimed at insuring Social Security beneficiaries whose numbers and needs were growing.

Between 1960 and 1965, the health coverage debate was a front burner issue in Congress, with dozens of proposals introduced and testimonies given by representatives of major organizations, including the American Hospital Association, the American Medical Association, and the AFL-CIO. After Congress passed the legislation in the summer of 1965, President Lyndon Johnson decided to sign the bill with former President Truman at the Truman Presidential Library in Independence, MO, in order to recognize Truman’s early effort to establish a national health insurance program.

What that doesn't tell you is the three key aspects of the Medicare and Medicaid Act; 1) It explicitly bought off the AMA by telling them that Doctors could keep billing at UCR rates and would not be interfered with by the government. 2) It explicitly gave the Blues plans a role in processing Medicare claims, one which they still by and large have, and 3) most important, look at the date. The whole bill was done and dusted less than 6 months after the new Congress was sworn in. So the potential opponents were bought off, and then it was pushed through fast before they realized what was hitting them.

Now Johnson had advantages. He had won a landslide; he had more Democratic Senators on his side (although many were very conservative); he didn't have to worry about the deficit and thus could afford to buy off his industry opponents, who of course were much weaker than they were 30 years later, and he wasn't going for universal insurance for everyone (just the most expensive ones). And of course he lied about the cost (Note that that worked for Bush in 2003 too!). But one lesson at least is, if you want to get something done, make it simple and get it done fast before opponents can get it together to stop you. So don't be too fussed about the details so long as it works for your overall principles.

I remember going to the American Association of Health Services Researchers meeting in DC in 1993, and I, like everyone else, thought that the Clintons were going to get something passed.  How naive.  But I do remember one speaker saying that he remembered when it failed last time (1973), because everyone second best option then was to "do nothing".  He hoped that we had a better second option.  We didn't.

Instead the option was to trust the market. if I had a nickel for every health executive who told me that market reform was happening and that meant we didn't need government reform, then I'd probably have had two bucks by the end of 1994. But as soon as the "market" (i.e. doctors and hospitals) realized what "market reform" meant they started squealing for government protection.  That put the Republicans in a bind that they've yet to get out of. We used to call it "The market is working but managed care sucks",  as exemplified by Republican M. Stanton Evans in The National Review in this 1998 article. Of course nothing that came out of the period of market "reform" was that different to the mechanisms for cost control in the Clinton plan -- aggressive managed care plan pricing and Medicare cuts.

The memory of this foul-up may not be enough to matter.  Even if employers and the public can't afford the bill for health care, and even if providers fear that no reform may be worse that reform they have a stake in, it still may be impossible to do. In an article called The Great Health Care Debate of 1993-4 Derek Bok essentially argued that health care reform can't be done. as it's just too damn political. He also intriguingly noted that the Clinton plan was very popular in 1994 until it was associated with that name.  So politics trumped policy in a triumph of Limbaugh over logic.  And if you remember the vitriol over the very moderate Clintons from the newly loud right in the early 1990s maybe nothing would ever have worked. And we are no less polarized today.

But there are some positive points.  If you look at Harris polls taken nearly more than a decade apart, philosophically as a nation we are still in favor of universal health care access. (Below are the 2003 results)

By 75% to 21% (including a 66% to 30% majority of Republicans), most people agree that "people who are unemployed or poor should be able to get the same amount and quality of medical services as people who have good jobs and are paying substantial taxes".

By 69% to 27% (including a 63% to 32% majority of Republicans), most people disagree that "it’s fair that people who pay more in taxes (or in health insurance premiums) should be able to get better medical care than those who pay little or nothing."

In fact despite 15 years of arrant egotism and conservatism this whole series also shows that we've only become slightly meaner since 1991. And in principle we as a nation want to move to universal health care. So I think that at some point reform can and probably will be done, particularly as all the pressures of 1991-3 are worse now.

But we unquestionably need to take advantage of the opportunity that the failure of the system is presenting us with. Especially the new equation that "a job doesn't not equal health care access". We need to get the debate into gear about how the system isn't working for most Americans, and how "that means YOU!" for what's left of the middle class. Particularly the white, male, southern, middle class.

The main lesson of HillaryCare is that when the right moment comes along politically we need to get whatever form of universal reform can be agreed on shoved quickly through the Congress. Make no mistake, universal insurance is a big bang and a necessary big bang.  Getting it through will be a hell of a confluence of opportunity and tactics.  Once we get it done, then we have a while to worry about sorting out the system to the purists' satisfaction later.

So will you all still please stop arguing about what it should look like!

July 19, 2005 in Policy/Politics | Permalink

Comments

When you get cranked on a topic like this, Matt, you really do a superb job. Someday you might even think about doing this for a living.

If I have any complaint - and I really don't - its that universal coverage is the yin that must have a yang of retooling the health care enterprise to manage cost and quality. Our group thinks of this in 5 major areas: 1) standardized performance measures throughout the continuum, 2) compatible (interoperable) IT, 3) evidence-based medicine and management, 4) pre- and post-market technology assessment/surveillance, and 5) paying for outcomes rather than services.

If we don't link these two issues - establishing a floor of coverage for everyone in the country so that every presenting patient is associated with funding for at least basic care and managing cost - the explosion in cost will continue to consume all our money.

That said, there are some terrifically valuable lessons here, especially in terms of moving swiftly and with a clear and understandable message.

Posted by: Brian Klepper | Jul 19, 2005 8:37:23 AM

And don't forget the problem of Weasel Words:
http://www.weaselwords.com.au/index3.htm

Posted by: gadfly | Jul 19, 2005 11:08:35 AM

Great perspective, very real-world and informed by larger trends in the economy and public opinion.

I'm interested in the shout of exasperation that ends your post: "So will you all still please stop arguing about what it should look like!" I too am tired of ideologues fencing back and forth and excommunicating one another from the true church of universal health coverage because somebody advocates a model with some unacceptable feature. And I agree with your argument that Hillary labored way too long to produce an absurdly overdetailed and unsellable plan.

Still, your post actually seems to argue that the Health Security Act failed in part because of specific decisions made as to the nature of the model, e.g., including Medicaid enrollees in the risk pool and cutting Medicare and medicaid reimbursement.

My impression up until that last line was that you were saying that we should indeed sweat over the model, but not the details. Perhaps you could clarify, since many health policy geeks are preparing to confess their sins and throw away their Collected Volumes of the Jackson Hole Group Deliberations With Endnotes, Multiple Regression Tables and Observations on Caribou Seen From the Picture Window.

Posted by: TomHilliard | Jul 19, 2005 8:39:30 PM

Overdose Of Socialism

Lucky that President Clinton and Hillary wrote a book explaining "their" ideas about American health care. Republicans simply read from the Clinton's book and took the House of Representatives.

President Bush on the other hand passed HSAs without any public discussion.

Hillary will never be President because there is too much video of her looking bad, with Donna Shalala, trying to sell Socialized Medicine.

Code Blue: Hillary's Presidential Hopes

Posted by: Ron Greiner | Jul 20, 2005 5:21:40 AM

//passed HSAs without any public discussion.//

No public discussion is a good thing?

Posted by: gadfly | Jul 20, 2005 11:32:03 AM

//No public discussion is a good thing?//

This time it was.

Posted by: Ron Greiner | Jul 20, 2005 2:15:22 PM

//This time it was.//

That's just about the scariest thing I've ever heard.

Posted by: gadfly | Jul 20, 2005 2:28:26 PM

C'mon guys you dont think that all your chat here abut HSAs isn't public discussion?

Meanwhile I do agree with Ron. We will continue to have no serous health reform until such time as when the big bad voodoo daddy of "Socialized medicine" looks worse to the American public than the alternative. So the alternative will have to look pretty bad...but it's getting there!

Posted by: Matthew Holt | Jul 20, 2005 3:49:35 PM

//no serous health reform until such time as when the big bad voodoo daddy of "Socialized medicine" looks worse to the American public than the alternative. //

Matt, I reread this several times, and I'm not following it. Are you saying that socialized medicine currently looks better to the American public than the alternative? I thought there was no better way to kill a discussion on health care than to bring up socialized medicine.

Of course I'm in favor of at least partially socialized medicine, so maybe the grass is always greener...

Posted by: gadfly | Jul 20, 2005 5:38:52 PM

oops, I meant "better" of course

Posted by: Matthew Holt | Jul 21, 2005 10:57:59 AM

Newt and Hillary are in love.

Hillary now accepts vouchers in Medicaid for the purchase of insurance in the free and open market.

Read it here http://www.washingtonpost.com/wp-dyn/content/article/2005/07/21/AR2005072102272.html?nav=rss_nation

Posted by: Ron Greiner | Jul 22, 2005 7:46:48 AM

There is a great book about the politics of that debate called "The System : The American Way of Politics at the Breaking Point" co written by David Broder. I think it is a great primer of how congress "works"

Posted by: Matt | Aug 12, 2005 7:29:03 AM

I agree that the system needs to be reformed. But the great lesson of Hillarycare is that the providers (AMA) and insurers (AHIP) must be co-opted,as was done in the passage of Medicare. Which is to say that the free market, for-profit, capitalist aspects of the system must be preserved.

Covering the uninsured will require means testing for any new program as well as Medicare. One method to generate revenue to cover the uninsured might be a tax on health insurance. Another might be a law ala state auto insurance mandates requiring everyone above a certain income to purchase health insurance. This would need to be coupled with prohibition of denial of coverage of preexisting conditions and the like.

Uninsured isn't synonymous with uncared for, so these steps would simply make the implicit subsidies in the current non-system explicit. Importantly, they would remove the perceived and real financial barriers that incent the uninsured to forego inexpensive routine care that results in expensive emergency treatment.

Instead what we have in Congress now is a socialist fantasy--HR 477--supported by an outfit called Healthcare NOW or something like that which essentially calls for mandatory conversion of for-profit hospital chains and health plans to non-profit status, pharmaceutical price controls, criminilizationn of private health insurance, and the like. Reformers need to find an American way, not a European/Canadian style revolution.

Posted by: Terry Nugent | Aug 12, 2005 9:17:03 PM

Great article.
As someone who works at a pro-market-reform healthcare organization, I'm becoming more convinced that socialized medicine is inevitable, to some extent.
Here's why - and correct me if I'm wrong:
#1 - Technology is outpacing access. Who cares if there's a "robotic nano-super-procedure" to take out my gall bladder, if I don't have basic access to care.
#2 - People want to simplify their lives. Nobody wants to deal with market-based reforms like tax credits; especially people who a)don't pay taxes OR b)can't understand English. Beltway wonks do not understand this phenomenon. Car insurance is one hassle - nobody wants another one.
#3 - Doctors are giving up on the theory that market driven healthcare creates a more innovative system. They're seeing too much money go to unneeded drugs and high-profit insurers... and less go to safety net hospitals, clinics and... well... themselves.
Please critique my response. I'm a one-year veteran in healthcare.

Posted by: Nate Osburn | Aug 29, 2005 6:54:49 AM

Really interesting stuff. Appears to be a great overview of the Clinton h/c debacle, something I admittedly did not follow as closely as I should have at the time. So I am belatedly trying to catch up.

On another note, the HTML code for the link to the PBS timeline is a little out of whack. It seems that there is a misplaced closing tag somewhere in there.

Posted by: JD | Nov 10, 2005 6:47:43 AM

These posts (with the exception of Terry Nugent's) on the fate of President Clinton's health reform proposal remind me of the debate itself: a false choice between socialized medicine and letting broken markets run amok. As a Congressional staffer who led the effort to draft the original managed competition bill in Congress in 1991, let me relate a conversation between my boss, Rep. Michael Andrews and Rep. Jim McDermott, a congressional support of a Canadian, single-payer system, that neatly sums what happened.

As the Clinton bill went to press, McDermott told Andrews, the Clinton bill may look like your bill, but it will be what I want. The Clinton bill was indeed a government-run health care system because the government controlled the prices. That approach had the effect of uniting the health care industry against it while the industry was split on the idea of managed competition.

Few remember now that the nation's mostly Democratic governors and large employers both supported managed competition. That might have been enough political clout to take advantage of the split in the health care industry. Of course, we'll never know.

But we can avoid the mistakes of the past by not repeating them. The government's role shouldn't be to run health care nor expect the market to solve the problem. Government's role should be to set to the conditions that enable everyone to secure coverage and make responsible choices.

Most Democrats today have it right on getting to universal coverage. They support some version of the Federal Employees Health Benefits program, which gives members of Congress and federal workers a broad set of choices. The Republicans meanwhile have bet the farm on a cost control strategy using health savings accounts that will take us only so far, as Matthew Holt as pointed out elsewhere in his blog. The opening for Democrats is to come up with a cost control strategy that addresses health care costs for the sickest patients because that's where the real waste and large potential savings lie.

I'm not sure what the solution is, but there's lots of interesting stuff happening. For example, King County (Seattle area) Executive Ron Simms has launched the Puget Sound Health Alliance. It intends to deploy systematically and system-wide all the cost restrain tools presently available: chronic disease management, pay-for-performance, evidence-based medicine, practice guidelines, information technology, patient incentives for responsible choices, etc. This kind of leadership can and should be replicated throughout the country.


Posted by: David Kendall | Dec 8, 2005 2:03:42 PM

There seems to be a constant oversight as to what really killed Hillary's plan. She brought together a large group of people to help develop the plan. If I recall, among her group of dozens were one or two physicians, and no people at all who were providing full-time direct patient care! Since everyone other than clinician and patient is simply a middleman, and can easily be disposed of without any harm to the system, her plan was doomed from the outset. To develop a successful plan requires, first, agreement from direct clinical care personnel that the plan will do no harm to patients and will be fiscally prudent (for them). Then it requires acceptance from patients. After that has been achieved, the middlemen (e.g. hospitals, insurers, etc.) can be approached. It doesn't matter what a bigwig at a state medical alliance or journal editor says (even though they may be MDs - and if they're not, they really don't typically have a clue) unless an average small town 80°/week family practice doc signs off on a given plan.

Posted by: Stuart Gitlow MD | Jan 4, 2006 7:53:52 AM

Very informative post and comments. Would like to hear more on how paying for outcomes rather than services works.

Posted by: Emilie | Apr 12, 2006 12:17:53 PM

THis is insane how dare u post this bullshit.... shame on you and go to hell!

Posted by: budda | Jun 5, 2006 1:29:35 PM

Wow Budda, impressive analysis.

Perhaps you should get a job in DC ...

Posted by: john | Jul 22, 2006 6:56:07 AM

As I've blogged time and again, Clinton's health care plan failed because it offered something to every interest group but patients and payers. Voters saw the plan as a scheme to entrap them in a huge government program that was designed to give Democrats the ability and power to use the health care system to buy votes for generations.

So the voters were smarter than the wonks and the politicians who will never forgive them for their wisdom. If Clinton's plan had become reality, Iraq would be number 10 on the list of political issues facing voters in November 2006.

Posted by: Donald E.L. Johnson | Aug 28, 2006 6:18:31 PM

"Voters saw the plan as a scheme to entrap them in a huge government program that was designed to give Democrats the ability and power to use the health care system to buy votes for generations."

No, you pervert the facts and make extrapolations according to your own bias.

That's called opinion.

And unless you reside in a parallel universe and have simply stopped in to inform us of how the other "study" concluded, you should adopt a bit more humility in your thought processes and little less "genius."

Posted by: Mark Stambovsky | Oct 13, 2006 11:44:45 AM

Hillarycare failed for one reason, and one reason only: money. Over $100 million dollars per year transferring from for-profit health care interests to the pockets of politicians worked exactly as intended.

Posted by: Jack E. Lohman | Oct 19, 2006 6:50:35 AM

Well.....I'm a nurse practitioner in Oklahoma. I have set up a practice that is both affordable and profitable. We are 4 Nurse Practitioners. We see cash, check, credit card patients as well as Medicare and Medicaid. We do NOT accept any private insurance. They are a rip off to both the patient and the health care system. The only one really making money is the insurance industry.

We see between 45 and 60 patients everyday in 1200 square foot office with only 4 exam rooms. And nobody spends more than 10-15 minutes in our pleasant and inviting waiting room.

For our cash, check, credit card patients we charge what Medicaid of Oklahoma pays (about $45.00 per visit). Every patient pays BEFORE they are seen. My grocer won't let me bring a steak home, eat it and then decide if I'll pay for it or not...so I don't play that game at our office. Studies show that sending out monthly statements to patients costs on average between $5.00 and $7.50 per statement in employee costs, stationary costs and postage.

My office manager spends 4 hours per WEEK filing the Medicaid and Medicare claims. We get paid the following week. If we took commercial insurance that time would climb and we'd have to charge more to compensate for the employee we'd need to file and follow the claims.

We are totally electronic and have been from the first. We don't have ANY space dedicated to charts and chart racks. Although we have almost 5000 active patients, last year we used 2.5 cases of paper for the whole year.

I decided since doing business the way the doctors are doing it wasn't working, that I, as a nurse practitioner had the opportunity to try something different for a change. Well, Will Rogers I'm sure is proud of our successful venture. After 18 months we were making a profit which has grown every month after that. October 3 was the third anniversary of our business.

Although I'm sure Will Rogers would be proud of our Oklahoma effort, Hillary would not. In fact, I sent her my website address and wrote her an email about our model for changing health care. She (or someone who works for her) responded that Hillary didn't have time to look at anything anyone is doing outside the state of New York. She only deals directly with her constiuents issues. Well, if she runs in '08 I can guarantee I'll offer to my friends and family recommendations for people who just might care about all Americans...even the poor and uninsured in Oklahoma.

I just hope the doctors of central Oklahoma continue to play life with their heads in the sand.....I'll just take the profits of low cost healthcare and put them in the bank.

Posted by: Glenda Clemens | Oct 19, 2006 9:44:02 PM

Way to go, girl!
But, do you not, as an NP, have to practice under the wing of a physician in Oklahoma?
How are his/her costs computed?
Or, do you simply refer the patient?

Be well.

Posted by: Mark Stambovsky | Oct 29, 2006 4:41:12 AM

Brian Klepper said:
"If I have any complaint - and I really don't - its that universal coverage is the yin that must have a yang of retooling the health care enterprise to manage cost and quality."

Of course, if we simply fixed the cost and quality first, we might find we don't need universal coverage after all. But then that would defeat the whole purpose of breaking the health care system in the first place, wouldn't it?

Posted by: cpurick | Nov 13, 2006 7:37:03 PM

It is a pipe dream to believe that cost can be "managed" in a for-profit system of healthcare.
When the primary reason for existence is the accumulation of profit all other considerations--however obvious--will be forever pressured to maintain legitimacy.
Quality is maintained by adhering to evidence-based practices, certification, continuing education, and access to the entire p[opulation. Costs are managed by deleting middle men, establishing fair reimbursements, salaries, a first-rate network of primary care centers to prevent most of what we now incur because of no preventative care, and fair taxes to support what many believe is at least the promise of good health.

Of course, personal accountability and responsibility MUST be an expectation. Personal abuse must not be passively encouraged by repeated care. That's a tough one, though, to reconcile. For too many have grown to expect care at any cost, for any reason, however futile, irresponsible, or clinically wasteful.

"...if we simply fixed the cost and quality first, we might find we don't need universal coverage..."
Universal care is the only logical and responsible system to adopt if one believes we all deserve the basics in life. This country is astoundingly rich(or had been before this administration)and can implement such a system amongst the entire population should it decide to do so.
The potential momentum is here but the Bucket-O'-Courage meter has been flashing "e" for quite a while.

Posted by: Mark Stambovsky | Nov 24, 2006 7:21:55 AM

I have worked in the healthcare delivery business for the past 15 years. Throughout this period, I have advocated socialized medicine. It makes sense and has been successful in containing costs in other industrialized countries. The problem is how you sell it to the American public. They only understand the negative rhetoric like rationing care. It is a patent fact that a properly executed social system would slow medical inflation.

Posted by: Layton Lang | Nov 28, 2006 10:11:25 AM

I read your rather bloated blog on why the Clinton health care initiative failed in 1994. While it is rather long and no doubt well researched, the reason for the failure could be summed up in the fact that the democrats couldn't get together on it while the republicans were united in their opposition. No matter how good of an idea would be coming from the democrats, Newt Gingrich and the republicans he brought into congress in 1994 would trash it.

I read the text of the Clinton health care plan and no where in it was any type of government single payor or other type of "socialized medicine" ever mentioned except as a default should the private health insurance infrastructure fail. Right now, we are much closer to that private health insurance infrastructure collapsing than we were back in 1994.

The republicans were very well funded and ran those obnoxious and misleading "Harry and Louise" commercials designed to scare the American public away from the Clinton plan. It worked, Americans became scared that the Clinton plan would "have bean coutners and government bureaucrats making decisionn on health care, not doctors". Instead, we wound up with bean counters and bureaucrats employed by health insurance companies and HMOs making health care decisions.

The gist of the Clinton plan was a heavy reliance on managed care and purchasing cooperatives among employers and individuals. The major government involvement was to make sure that everyone would be covered. There was a mandate that if an employer wasn't sponsoring a group health insurance plan for their employees, then they would be forced to pay into a fund so those uninsured could afford coverage. Guess what - a repubican governor of Massachusetts has enacted pretty much the same thing.

The Clinton plan was also heavy on tax credits and using the tax code to encourage people to purchase health insurance on the open market. Now we have a conservative republican president floating out the same idea.

"Incrementalism" seems like an invented word. In fact incremental change does not work and there is the law of unintended consequences working. A prime example of the failure of "incrementalism" is the HIPAA law enacted in 1996 with the intention of eliminating "job lock" where a person is locked into a job because they would not be able to get health insurance if they changed jobs. Remember the "P" in HIPAA stands for portability. However the framers of the HIPAA law forgot that the major reason people are uninsured is that they cannot afford health insurance.

The end result of HIPAA is that through pricing, it is very difficult for an employer group with some unhealthy members to change insurers because other insurers will price them out of the market. In order to convert to an individual policy under HIPAA, the red tape is very cumbersome and intimidating. Then the cost of insurance is in the ionosphere. Last year a 55 year old female that I knew was looking at obtaining an individual health insurance policy through HIPAA after exhausting COBRA. She had a number of pre-existing conditions so HIPAA was her only route. The premium for a HIPAA policy with the only company writing HIPAA policies in the state (OH) had a $1500 deductible and cost her more than her total income per month. Needless to say she joined the ranks of the uninsured.

"Incrementalism" creates a new set of problems while not really solving the problem it was intended to solve. I liken "incremental change" as re-arranging the deck chairs on the Titanic after the ship had struck the iceberg believeing that the ship was unsinkable. We may as well face it the employment based health insurance system inthe United States is sinking.

Posted by: Lee Kamps | Mar 8, 2007 12:06:48 PM

Matt, you are absolutely correct that we need to collectively back a good proposal that brings all citizens under the tent of coverage and access, when the time is ripe, and not kill the good by seeking the perfect. With regard to cost and quality management, until we commit to covering all, and take a first swing at controlling costs, we will not commit to more quality control as an industry or nation. It was not until the dreaded HMO struck fear into hearts about quality that health care as an industry actually took a serious look at the quality issues. I believe the same will be true in the next big cycle of change. We cannot start all the components at once, or we will stall.

Posted by: Don Thieman, M.D. | Aug 29, 2007 1:57:19 PM

My 2c on this incendiary issue from abroad - I am now based in India, having relocated here from the US - is that the ONLY way there could be viable reform of Healthcare is by looking at them a la carte - ie, piece by piece, item by item. No pol has the patience or the personal payoff in visibility and gratitude of the nation (not to speak of other, less honorable, gains) in today's world.

The fact of the matter is the sector has too many well entrenched interests that are huge and whose stakes are egregiously mind boggling. It is foolhardy to think such interests would stand by and countenance drastic and definite threat to, or erosion of, their stakes in the market. The way out, as exemplified by President Johnson's Medicare Act, is to chip away at ostensibly small (note the word ostensibly) pieces and reform them. I would therefore add one more reason to Matt's: it was not just the speed of action, it was the presumably innocuous nature of the reforms.

Jay

Posted by: Jay Srinivasan | Jun 10, 2008 10:40:25 PM

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