Medical Costs Transparency: As Clear as Peanut Butter

October 23, 2019 No Comments

By Marilyn M. Singleton, MD, JD

What if purchasing medical products and services were like buying peanut butter? Grocery stores have several brands and varieties: smooth, chunky, old-fashioned, natural, organic, no added sugar, reduced fat, no-stir, and pre-mixed with jelly with clearly marked prices ranging from $1.75 for the store’s generic brand to $7 for the over-priced Yuppie brand. After carefully examining the labels, our shopper chose a 16-ounce, $5 jar of no-added-sugar peanut butter. She paid the cashier $5 for the peanut butter and went home.

If our shoppers were transported to the universe of medical billing with the $5 jar of peanut butter, the shopper with Medicare would pay $1.00 but her grandchild will be presented with a bill for $4. When the shopper with private health insurance attempts to pay, the cashier becomes unglued. The shopper cannot say whether she met her deductible or has a co-payment, and whether the brand of peanut butter is approved by the network. She really wants the peanut butter so she grabs the generic from the shelf and pays the $1.75. Our privately insured shopper was pleasantly surprised at the generic’s good taste and healthful ingredients, her wallet was happy for the cost savings, and she was glad not to have the middleman hassle.

Comparison shopping is one pillar of bringing sanity to the high cost of medical care, but the opacity of the pricing system for medical costs limits the value of posting list prices to encourage lower costs through shaming, competition, and choice. In addition to research and development, manufacturing, and distribution costs, drug costs are affected by additional layers of middlemen: pharmacy benefit managers (PBMs) and insurers. Using a “trade secret” process, PBMs negotiate discounts and rebates for private and government insurers. The money saved is supposed to go back to the government (taxpayers) or to insurers to lower premiums or otherwise benefit patients. PBMs typically are paid by a percentage of the rebate or discount off the list price. The higher the price, the bigger the rebate. Thus, the rebate system gives an incentive to raise list prices rather than placing the lowest-priced drug on the insurer’s formulary. (This same system is used by Group Purchasing Organizations (GPOs) for hospital product purchases.)

An analysis of the effect of California’s 2-year old drug price transparency law illustrates the complexity of pricing. Despite being compelled to post list prices, pharmaceutical companies raised the list price for wholesalers by a median of 25.8 percent but the data did not indicate the “price” that consumers actually paid. Moreover, with medical services and products the simple What the Market Will Bear (WTMWB) pricing method works because either the medication is essential (e.g., Epi-Pen®), has no alternative, is in short supply, or the medical consumer is not paying directly for the services.

Similarly, publishing hospital the charge description master (“chargemaster”). i.e., the standard industry price does not give consumers enough information to make a rational choice regarding elective medical services. The data necessary to make price comparisons depends on an individual’s circumstances. More relevant than the chargemaster price, a self-pay patient needs to know the lowest possible cash price. A patient with health insurance must know (1) whether the hospital is in the insurance network, (2) the price negotiated between the health care provider and insurer (including Medicare), (3) the amount and method of calculating cost-sharing, (4) the amount Medicare or other insurer will pay for services performed in a physician’s office in contrast to the hospital which tags on a “facility fee.”

Transparency is one tool for lowering costs through choice. As one of many studies on hospital consolidation noted, “The Sky’s the Limit” on prices where there is lack of competition. But the difficulties of achieving useful price transparency must not be a cue for the government to initiate bureaucratic band-aids. As we have seen with Obamacare, forcing insurers to pay more of the costs leads to higher premiums, deductibles, and/or co-pays.

Nor should the government impose price caps. President Nixon’s 1971 wage and price freeze brought product shortages—which we are already facing with certain drugs, including anesthetics and chemotherapy agents. If the government sticks to enforcing anti-trust laws, a competitive market will thrive. The court house door anti-trust settlement by Northern California’s Sutter Health sends a message to big hospital chains to stop using their market share to inflate prices or require insurers to join their networks on an all-or-nothing basis to prevent insurers from negotiating lower prices at individual hospitals.

If we can get to the point of direct exchange of money for goods and services and reserve health insurance for major expenses, we can see costs decrease just as we have seen with the Surgery Center of Oklahoma over the last 10 years.

Bio: Dr. Singleton is a board-certified anesthesiologist. She is Immediate Past President of the Association of American Physicians and Surgeons (AAPS). She graduated from Stanford and earned her MD at UCSF Medical School. Dr. Singleton completed 2 years of Surgery residency at UCSF, then her Anesthesia residency at Harvard’s Beth Israel Hospital. While still working in the operating room, she attended UC Berkeley Law School, focusing on constitutional law and administrative law. She interned at the National Health Law Project and practiced insurance and health law. She teaches classes in the recognition of elder abuse and constitutional law for non-lawyers.

Culture & Society, Health Policy, Healthcare Reform, Medicare, Medicine, Socialized Medicine

The Medical Care Wheel of Misfortune

September 24, 2019 No Comments

By Marilyn M. Singleton, MD, JD

You finally get your dream and are selected to be a contestant on Wheel of Fortune. You get to see Pat Sajak and Vanna White! You win a vacation to some country that you don’t really want to see. You cannot get the cash equivalent. You have to take 10 days off of work to take the free vacation you did not want. You discover that you have to pay the tax on the free vacation.

Or you win a free car. You have a perfectly functioning 3-year-old car. The free car was not really the car you would have selected. You accepted it because it was free. Then you see that you have to pay tax on the list price of the free car. You also discover that the collision insurance and Department of Motor Vehicles registration for the free car are significantly higher than for the car you currently own.

These are examples of why nothing is “free.” This applies to medical care as well. You may have to see the “health care provider” the government program or private insurer makes available to you. You don’t particularly want to see a nurse, but that’s the way the cookie crumbles with free health care. Oh well, you convince yourself that it’s okay because, just like that car on the game show, it was free.

Here’s a new spin on “free.” Yes, your medical care should be free – free from the restraints of government control. Free from the government rules that have raised the price of insurance premiums. The Affordable Care Act mandated ten essential benefits that all insurance plans must include free of out-of-pocket charges to patients. Of course, this does not include the initial out-of-pocket charge: the insurance premium. Insurance premiums shot up over the post-ACA year because the insurance plan has to cover conditions that the insured persons may not even encounter in their own lives. A glaring example is obstetrics coverage in a menopausal female. Preventive and wellness visits are also labelled as free.

Moreover, a recent AMA study revealed that over the last four years the competition in the commercial insurance market has decreased. In over 50 percent of metropolitan areas, representing about 73 million persons, one insurer has half of the market. The more concentrated the market, the higher the premiums.

Remember that free car? We all know and readily accept that car insurance does not pay for the gas and basic maintenance. So why should maintenance medical care be covered by insurance? Car insurance would be unaffordable for most car owners if it paid for gas, oil changes, new mufflers, radios, and batteries. Most states require drivers to have car insurance. If people can’t afford the insurance, they lose the benefit of owning a car.

Similarly, if you lose your health due to long waits or delayed diagnosis because the CT scan was not authorized or poor medication response because you had to take the formulary drug that was not the doctor’s first drug choice for you, the care is not free, but very costly.

The underlying message of free “health care” is disempowering. The message is that we are incapable of taking care of ourselves. Empowerment is having control over our own lives. First, we take charge of our own health by thinking about the choices we make. We choose to not smoke, overindulge in food or drink, or engage in foolhardy behaviors. Second, we decide what is important for our own health. If you do not want insurance coverage for obstetrics or fertility treatment because you are 50 years old and do not want children, there should be a less expensive insurance product available to you. Third, we need to be free to choose our own doctor as well as the treatment the doctor—not the invisible third-party payer—recommends.

The promised free health care would increase the payroll taxes on all workers, even if that worker does not want that particular brand of free medical care. The next time you hear that medical care is free, just think about that “free” car that is the wrong color, is too small, has uncomfortable seats, inadequate headroom, and overall is not what you really want.

Culture & Society, Health Policy, Healthcare Reform, Law, Medicare, Medicine, Op-eds, Socialized Medicine

The Healthcare Revolution: More Choices, Not More Taxes

December 20, 2018 No Comments

By Marilyn M. Singleton, MD, JD

Paris is in flames over a fuel tax increase that would pile 30 cents onto the $7.06 per gallon price paid by citizens whose average monthly salary is $2,753.This burdensome “carbon tax” on the middle class is intended to help meet Europe’s commitment to reduce carbon dioxide emissions and thereby halt global warming or climate change. It appears that the 21^st century French Revolution has begun. This time, Brussels is sending in tanks to protect the new elite and its agenda.

Back in the states, some well-heeled, presumably well-intentioned Medicare-for-All advocates from California, New York, and New Jersey are grousing about how “Trump took away my homeowners tax deduction!” The Tax Cuts and Jobs Act now caps the previously unlimited federal tax itemized deductions for the combined state, local and property taxes at $10,000. The portion of a mortgage on which interest can be deducted is limited to $750,000, down from the current limit of $1 million.

Folks with million-dollar homes who continue to vote for legislators who impose high state taxes to finance their pet social programs are less sympathetic than the French Yellow Vests—especially when these same elitists want to take away the “crumbs” from the 80 percent of taxpayers who are receiving some relief from the near doubling of the standard deduction.

But everyone will face still more taxes to fund Medicare-for-All. Bernie Sanders’s financing plan would “limit tax deductions for the wealthy,” defined as $250,000 per household. Sanders also proposes eliminating health savings accounts (HSAs), which allow patients to take charge of their own care. And it won’t stop there—or at the equivalent of 30 cents per gallon.

It’s not just the taxes: it’s the loss of the freedom to choose. The M4A bills prohibit virtually all private health insurance. M4A promises “free” access to “willing healthcare providers”—but robs us of choice. Even existing Medicare offers 11 supplemental insurance programs with options for different premium structures. Purchasers can decide to pay a little more now for a stable premium price as they age, or pay quite a bit less and anticipate the age-related increase over the years. But, you say there would be no premiums with M4A. Wrong. The “premiums” are increased taxes. And taxes are not optional. You must obey.

We should take a cue from the French (minus the fires and looting). We need a middle-class medical care revolt against the elitists and politicians who think more government through high taxes is The Answer while ignoring community solutions. For example, We Do Better, a humanitarian movement, seeks out solutions to social problems based not on a particular political ideology or lobbyist’s effort, but on what works. In Southern California eight Clinica Mi Pueblo (CMP) clinics accept only cash, have transparent pricing on their website, and their services cost less than half of the price set by third parties. Where the average charge for an X-ray is between $260 and $460, CMP charges only $80. Utah’s Maliheh Free Clinic (MFC) serves low income and uninsured residents who are ineligible for Medicare, Medicaid, or any government subsidized healthcare. The MFC provided free healthcare to more than 15,000 patients in 2016 at an average cost of only $56 per patient, and 95% of donations to MFC go to providing medical services. New Jersey’s Zarephath Health Center is a volunteer-run and funded facility for patients who cannot find care “in the system.” Here it costs $15 to see a patient, versus $160-$280 at the Federally Qualified Health Center down the street.

Another increasingly popular model is direct primary care (DPC). Here, patients pay a monthly subscription fee to the practice (between $40 and $100 depending on age and family size), which covers all primary care services, certain laboratory tests, and at-cost pharmaceuticals at as much as 15 times less than the price at the pharmacy. The personal relationship with a physician enhances the care to patients with chronic conditions, reducing costly hospitalizations. Catastrophic insurance can cover major medical expenses. St. Luke’s Family Practice in Modesto, California is a DPC non-profit organization. Here, “benefactors” pay the fees for the “recipients” – those who cannot afford the fees.

Then there are many health care sharing ministries where members engage in voluntary sharing of costs for its members’ health needs. One such model, the Christian Healthcare Ministries (CHM), has plans that cost half as much as ACA Marketplace plans. It has more than 279,000 members, and has covered more than $1 billion in medical bills since 1981.

Americans want authority over our own lives. Our innovative spirit and generosity have created and will continue to create ways to deliver medical care to the most people without sacrificing choice—and at a more affordable cost.

Dr. Singleton is a board-certified anesthesiologist. She is also a Board-of-Directors member and President of the Association of American Physicians and Surgeons (AAPS). She graduated from Stanford and earned her MD at UCSF Medical School. Dr. Singleton completed 2 years of Surgery residency at UCSF, then her Anesthesia residency at Harvard’s Beth Israel Hospital. While still working in the operating room, she attended UC Berkeley Law School, focusing on constitutional law and administrative law. She interned at the National Health Law Project and practiced insurance and health law. She teaches classes in the recognition of elder abuse and constitutional law for non-lawyers.

Culture & Society, Health Policy, Healthcare Reform, Law, Medicare, Socialized Medicine, Uncategorized

Mission Possible: Saving Freedom in Medical Care

August 17, 2018 No Comments

by Marilyn M. Singleton, MD, JD

In the original Mission: Impossible series, against all odds, through brilliant strategizing the good guys thwart stealth communist plots to undermine democracies. In trying to provide affordable, quality, personalized medical care, independent physicians face seemingly insurmountable obstacles: digging out from under piles of electronic paperwork, breaking free of third-party red tape, dodging hospital buyouts, and shielding patients from data mining and privacy intrusions.

But the biggest obstacle to great medical care is the socialist brigade rallying around Medicare for All, the proposed federally financed program that boasts no premiums, deductibles or copays, and medical, dental, vision and hearing benefits. What could possibly go wrong? As they say, show me the money. The Congressional Budget Office estimates the federal government will spend about $1 trillion on healthcare programs in 2018. A detailed Mercatus Center analysis concluded that Medicare-for-All would add $32.6 trillion to federal expenditures during its first 10 years.

Currently, payroll taxes and income tax on Social Security benefits fund Medicare’s Part A Hospital Insurance Trust Fund. The Centers for Medicare and Medicaid (CMS) estimates this fund will be depleted in 2026. General tax revenues and beneficiary premiums fund medical services coverage (Part B). Medicare for All would be financed by current Medicare funds – minus the insurance premiums – and would be supplemented by the ever-popular “taxing the rich.” Beware: the definition of “the rich” will be ratcheted down to encompass more taxpayers.

Then there is the coercive nature of Medicare. A beneficiary’s opting out of Medicare Part A means forfeiting all past and future Social Security benefits. Medicare for All makes it clear that no straying from the herd is allowed: neither private insurers nor employers can offer insurance that competes with the government.

Fortunately, more choices are becoming available for potential patients. The House of Representatives recently passed two packages of expansions of Health Savings Accounts (HSAs) (H.R. 6199, H.R. 6311). To name a few benefits, the contribution limit for an HSA nearly doubled to $6,650 for individuals and to $13,300 for families. HSAs would be allowed to pay for direct primary care (DPC) monthly fees. Best yet, anyone would be able to purchase a lower-premium catastrophic plan — removing the ACA’s under age 30 restriction. And purchasers of “bronze” and catastrophic (“copper”) plans would be able to contribute to an HSA.

Improving HSAs is not a trivial goal. HSAs are portable. HSA contributions reduce taxable income, money in the account grows tax-free, and money can be withdrawn tax-free to cover qualified medical expenses. The Employee Benefits Institute estimates that a person saving in an HSA for 40 years, assuming a 2.5% return, could accumulate up to $360,000.

The Executive Branch acted on CMS’s report that lower-cost alternatives were necessary given the rising premiums responsible for the decline in the purchase of unsubsidized ACA plans. The Administration created new rules for short-term limited duration (STLD) insurance policies, which are not bound by the ACA’s restrictive mandates.

STLD plans, defined by the Obama administration as less than three-months duration, can be up to 12 months duration and can include an option for guaranteed renewal up to 36 months. Californians may be out of luck if the proposed consumer protection legislation prohibiting STLD policies makes it to the governor’s desk.

According to CMS, in the fourth quarter of 2016 the average monthly premium for individuals for a STLD policy was approximately $124, compared with $393 for an unsubsidized ACA-compliant plan with comparable $5,000 deductibles. That is an annual savings of $3,228. Even adding $50 per month for a direct primary care practice, an individual saves $2,628 a year. With DPC, all primary care services, including chronic disease management and access to low-priced commonly used medications are included in the upfront price.

The HSA bills and the new STLD rules are an antidote to the erosion of our freedom to contract under the guise of protecting us from “junk” insurance. Medicare-for-All is not the cure for health care ills. Once the central planners lure the masses into dependence on “free” stuff, abuse of power ensues. Voluntary participation by physicians becomes mandatory. When the money tree withers, the non-negotiable provider payments are slashed, and services to patients are rationed.

To mitigate the unacceptable, sometimes fatal wait times in the Veterans Administration health system a bipartisan Congress looked to the backbone of great medicine: private practice physicians. Independent medical practices will lead the way to achieving great affordable medical care through competition and consumer choice.

Dr. Marilyn M. Singleton, MD, JD is a board-certified anesthesiologist and member of the Association of American Physicians and Surgeons (AAPS).

Dr. Marilyn Singleton ran for Congress in California’s 13th District in 2012, fighting to give its 700,000 citizens the right to control their own lives.

While still working in the operating room, Dr. Marilyn Singleton attended UC Berkeley Law School, focusing on constitutional law and administrative law. She also interned at the National Health Law Program and has practiced both insurance and health law.

Dr. Marilyn Singleton has taught specialized classes dealing with issues such as the recognition of elder abuse and constitutional law for non-lawyers. She also speaks out about her concerns with Obamacare, the apology law and death panels.

Congressional candidate Dr. Marilyn Singleton presented her views on challenging the political elite to physicians at the Association of American Physicians and Surgeons annual meeting in 2012.

Follow Dr. Marilyn Singleton on Twitter @MSingletonMDJD

More info about Dr. Marilyn Singleton

Culture & Society, Doctors, Health Policy, Media & Press, Medical Ethics, Medicine, Op-eds, Politics

The Courage to Trust Medical Care to Patients and Physicians

August 17, 2018 No Comments

by Marilyn M. Singleton, MD, JD

The days of trusting your legislators to have your best interests at heart are in the rear view mirror. Apparently, their main interest is parroting the buzzwords of the moment to get elected and then being too busy banking lobbying money to listen to the voters. Our legislators have become spectators who wait for the perfect moment to pounce on their political “enemy” and then go on cable news shows to boast about it.

The “us against them” attitude, punctuated by hyperbolic, apocalyptic rhetoric closes the door to finding solutions. Our interests would be better served by having town hall meetings where voters could state their concerns, air their differences, and learn what legislators are doing about their issues. Caution: meetings at 9 a.m. on Wednesday when paid activists are guaranteed to outflank the working general public are prohibited.

There are strong differences of opinion on how to attain a healthy citizenry. Educating potential patients about what drives up medical care expenditures can start the conversation. Well-informed patients would demand solutions based not on corporate interests or government or political agendas, but on a fair, competitive market that maximizes choices and achieves lower costs.

Eight years of the Affordable Care Act have borne out Congressional Budget Office predictions that abandoning basic principles of insurance—which compensates only for events beyond the insured’s control and is priced according to the degree of risk—would lead to higher and higher premiums, fewer participating insurers, and unsustainable government expenditures to subsidize insurance premiums. The data in three recent Centers for Medicare and Medicaid reports on ACA exchanges show “individual market erosion and increasing taxpayer liability.” The average monthly premium for coverage purchased through the exchanges rose 27 percent in 2018, and federal premium subsidies increased 39 percent from 2017 to 2018.

A less frequently discussed cost driver is the disturbing trend of private doctors’ offices being scooped up by hospitals, health insurance companies, and venture capital groups. Prices tend to rise when health systems merge, because of decreased competition. And not only do hospitals and health systems generally charge more than private physicians’ offices, the government compounds this problem by paying more to hospitals than independent offices for the same service. A review of 2015 Medicare payments showed that Medicare paid $1.6 billion more for basic visits at hospital outpatient clinics than for visits to private offices. Patients are the biggest losers: they paid $400 million more out of pocket and had their tax dollars wasted. The study also found hospital-employed physicians’ practice patterns in cardiology, orthopedic, and gastroenterology services led to a 27 percent increase in Medicare costs. This translated to a 21 percent increase in out-of-pocket costs for patients.

Similarly, a U.C. Berkeley School of Public Health study of consolidation of California’s hospital, physician, and insurance markets from 2010 to 2016 concluded “highly concentrated markets are associated with higher prices for a number of hospital and physician services and Affordable Care Act (ACA) premiums.” In consolidated markets (defined by the Federal Trade Commission’s Horizontal Merger Guidelines), prices for inpatient procedures were 79 percent higher and outpatient physician prices ranged from 35 percent to 63 percent higher (depending on the physician specialty) than less concentrated markets.

Big medicine and third-party financing are taking the cost curve in the wrong direction. This speaks to the urgency of encouraging cash friendly practices that bypass insurance and direct primary care (DPC) practices. With DPC, all primary care services and access to low-priced commonly used medications are included in an affordable upfront price. Importantly, DPC’s time-intensive and individualized management of chronic diseases decreases hospital admissions, paring down Medicare’s $17 billion spent on avoidable readmissions.

Why corporations want to marginalize private practice seems clear; the government’s motive is open to debate. Surveys consistently find that patients overwhelmingly want “personalized provider interactions.” Thus, herding patients into government-directed programs is not the solution. One core problem with government systems is their reliance on the goodwill of politicians. As President Ford said, “a government big enough to give you everything you want is a government big enough to take everything you have.”

It’s time for Congress to scrutinize anti-competitive health system mergers. It’s time to bring to the floor over a dozen bills to expand and improve Health Savings Accounts (HSAs) to give patients more control over all facets of their medical care.

Congress, the clock is ticking on this legislative session. Stand up for patients. Or did the dog eat your courage?

Dr. Marilyn M. Singleton, MD, JD is a board-certified anesthesiologist and member of the Association of American Physicians and Surgeons (AAPS).

Dr. Marilyn Singleton ran for Congress in California’s 13th District in 2012, fighting to give its 700,000 citizens the right to control their own lives.

Congressional candidate Dr. Marilyn Singleton presented her views on challenging the political elite to physicians at the Association of American Physicians and Surgeons annual meeting in 2012.

Follow Dr. Marilyn Singleton on Twitter @MSingletonMDJD

More info about Dr. Marilyn Singleton

Culture & Society, Doctors, Health Policy, Healthcare Reform, Medical Ethics, Medicine, Socialized Medicine

Medical Care in 2018: Ring Out the Broken Promises and Bring In Solutions

January 9, 2018 1 Comment

By Marilyn M. Singleton, M.D., J.D.

The U.S. “health care system” continues to be a costly behemoth. Health care costs were the number one financial concern for 17 percent of families in 2017—the same level as it was in 2007 pre-Affordable Care Act era. And only 18 percent of those polled said the Affordable Care Act helped their family.

The ACA did not work as promised.

“If you like your health care plan, you can keep it.” Unfortunately, health insurance companies canceled plans for 4.7 million people. Many insureds chose to have inexpensive, limited plans to cover major expenses. These plans however were not ACA-compliant as they did not contain the mandated 10 “essential health benefits” with no copays or deductibles. While many of these required “benefits” are medically useful, many (e.g., pediatric vision and oral care, maternity care, breast cancer genetic screening, mammograms, and female contraception) are superfluous for childless unmarried men.

“I’ll also bring Democrats and Republicans together to provide every single American with affordable, available health care that reduces health care costs by $2,500 per family.” Kumbaya? The ACA was passed in the dark of night with only Democrat votes. Affordable? Overall costs to the consumer have risen dramatically.

In 2008, the cost of the average employer-sponsored family plan was $12,680, with an employee share of $3,354. The 2016 cost topped out at $18,142 with a $5,277 employee cost. In the individual market, the biggest losers are those who earn a little too much to qualify for federal premium subsidies, particularly the self-employed in their 50s and 60s. For a bronze-level plan with a health savings account, a three-person family can pay $15,000 a year in premiums and paid out-of-pocket for the first $6,550 of medical expenses for each family member.

Moreover, many insurers have requested—and will likely receive—double-digit premium increases for 2018. Nationally, the increases between 2017 and 2018 for unsubsidized premiums for the lowest-cost bronze plan averaged 17 percent, the lowest-cost silver plan averaged 32 percent, and the lowest-cost gold plan averaged18 percent.

“We’ll start by increasing competition in the insurance industry.” That was a colossal failure. Overall, the number of insurers in the individual market has decreased since 2014. In 2017 UnitedHealth Group eliminated ACA Exchange plans in 31 of 34 states and Aetna remains in only four states. Humana and Aetna plan to exit all ACA Exchanges in 2018.

Agreed, some Americans gained health coverage. Medicaid and the Children’s Health Insurance Program (CHIP) accounted for 14.5 million of the 20 million of newly covered. The 2014 cost per non-disabled adult and child enrollee was $3,955 and $2,602, respectively. Some 27.5 million people remain uninsured with cost cited as the main problem.

Further, being “covered” was meant to keep emergency departments (EDs) from being used as an alternative to primary care. But according to the federal Agency for Healthcare Research and Quality (AHRQ), the number of emergency department visits covered by Medicaid increased by 66.4 percent between 2006 and 2014, outpacing population growth by a factor of two, making Medicaid the leading payer for ED visits.

These data tell us we must have a serious conversation, not intellectually lazy political slogans, like “Repeal and Replace!” Instead of ruminating about how to modify the government’s involvement in medical care, Congress and policymakers should ask how can we take better care of more patients and be open to all suggestions.

One successful model is direct primary care (DPC) mainly seen in solo and small medical practices. Here, patients pay a monthly fee (generally ranging $75 to $150) directly to the physician’s office for 24/7 access, and in many cases, basic labs and medications, and steep discounts on radiology and pathology services. Also growing are direct pay specialty and surgical practices where the fees for the operating room, surgeon, and anesthesiologist are included in one low price. And yes, many of these practices (even in California) offer sliding scales and charity care without running afoul of rigid federal regulations.

With DPC, patients spend more quality time with their doctors and physicians can shed the administrative burdens of government programs and insurance companies and treat patients according to their best judgment. A testament to the success of this model is the University of Michigan offering such a program this spring. Hopefully, the big boys won’t ruin a good thing.

ObamaCare’s individual mandate is dead. It’s time to use our healthcare dollars wisely and pay for the medical care, not the middlemen.

Dr. Marilyn M. Singleton, MD, JD is a board-certified anesthesiologist and member of the Association of American Physicians and Surgeons (AAPS).

Dr. Marilyn Singleton ran for Congress in California’s 13th District in 2012, fighting to give its 700,000 citizens the right to control their own lives.

Congressional candidate Dr. Marilyn Singleton presented her views on challenging the political elite to physicians at the Association of American Physicians and Surgeons annual meeting in 2012.

Follow Dr. Marilyn Singleton on Twitter @MSingletonMDJD

More info about Dr. Marilyn Singleton

Doctors, Health Policy, Healthcare Reform, Medicine

The Surprise in California’s Medical Bill Law

November 3, 2016 No Comments

by Marilyn M. Singleton, M.D., J.D.

These days, in order to keep costs down the vast majority of insurance plans use the model that limits the hospitals or physicians from whom patients can get medical services. The “covered services” are determined by the insurer. The plans involve contracts between the insurer and the patient, and the insurer and the “health care providers.” The parties agree upon and know in advance who must pay for medical care—with the amount to be determined by the insurer.

The insurer develops its “provider network” by negotiating discounted prices with hospitals, laboratories, radiology facilities, and physicians. The value to the service providers and physicians is that in exchange for reduced fees, they might have an increased volume of patients.

On the patient’s end, the incentive for using the network personnel is the “discounted” price. After receiving in-network medical treatment, the patient expects to pay out of pocket any co-payment or co-insurance fee, and any deductible that the plan requires. If the patient uses out-of-network services, the insurer generally imposes higher cost sharing. Also, the out-of-network provider can bill the patient the difference between the customary or “market” rate and the in-network contracted rate for the same service or procedure (“balance billing”).

One downside to the networks is that patients may not have access to the care they need because some hospitals lack sufficient in-network hospital-based specialists. Because hospitals fill the gaps with out-of-network physicians, a patient could unknowingly receive care from an out-of-network physician or service at an in-network facility.

No one—particularly your physician—wants to see patients suffer financially. California’s newly-minted solution to “surprise medical bills” is Assembly Bill 72. Under this law, if a plan’s patient obtains medical care at an in-network facility but receives treatment or services from a non-contracted out-of-network provider, the patient would only pay for such services as if they were in-network. (This is already the case for some emergency services.)

Problem solved—no surprise bill.

It’s also no surprise that yet again insurers get the brass ring. Insurers can pay the non-contracted out-of-network physician the same amount they pay the physician on contract with the insurer. And if the doctors don’t like the payment, they can go to arbitration at their expense to seek their usual fee. It is a remedy in name only as the legal costs would outweigh any benefit.

Note: AAPS has filed suit to stop AB 72. Details at http://StopAB72.com

Dr. Singleton is a board-certified anesthesiologist and Association of American Physicians and Surgeons (AAPS) Board member. She graduated from Stanford and earned her MD at UCSF Medical School. Dr. Singleton completed 2 years of Surgery residency at UCSF, then her Anesthesia residency at Harvard’s Beth Israel Hospital. While still working in the operating room, she attended UC Berkeley Law School, focusing on constitutional law and administrative law. She interned at the National Health Law Project and practiced insurance and health law. She teaches classes in the recognition of elder abuse and constitutional law for non-lawyers.

Culture & Society, Health Policy, Healthcare Reform, Medicare, Medicine, Op-eds

Obama the Emperor Has No Clue

August 12, 2013 No Comments

The Emperor Has No Clue

By Marilyn M. Singleton, M.D., J.D.,

When President Obama hawks the wonders of the misnamed Patient Protection and Affordable Care Act, I’m reminded of those “As Seen on TV” products.

True believers ridiculed critics of the Independent Payment Advisory Board and its unchecked power to ration health care. They were impressed by the $575 billion cut to Medicare, although lower payments lead physicians to accept fewer Medicare patients. They cheered because 11 million Americans will be added to the Medicaid rolls over the next ten years.

While Medicaid looks like is a good deal with its low co-pays, provider payments are so low that only one-third of physicians accept new Medicaid patients.

True believers scoffed at claims of loss of privacy. After the NSA snooping revelations, a Pew survey revealed that 70 percent of Americans believe the government is using data for purposes other than fighting terrorism.

Not only could unethical employees misuse health and financial information, the health “Data Hub” can be shared among seven federal agencies for ill-defined “routine uses.” According to a former HHS general counsel, the federal government’s computer program for insurance exchanges lacks privacy safeguards and could expose applicants to identity theft.

President Obama has repeatedly promised that “if you like your health care plan, you can keep it.” Even his Praetorian Guard has now defected. The National Treasury Employees Union—which represents the IRS folks who are ultimately in charge of ObamaCare—does not want its members to be “pushed out” of the Federal Employees Health Benefits Program and into the insurance exchanges.

Candidate Obama promised: “If you already have health insurance, the only thing that will change for you under this plan is that you will spend less on premiums.” Au contraire. Insurance premiums have risen an average of 30 percent since ObamaCare’s enactment. In Orange County, California, premiums for a 25-year-old in good health will rise by 95 percent.

Insurance will cost less for the lucky 26 million Americans who are eligible for health insurance exchange subsidies that can pay more than half the cost of policies. Subsidies—paid directly to insurance companies—are available for those with incomes from 138% ($15,415 for individuals; $29,326 for a family of four) to 400% ($45,960 for individuals; $94,200 for a family of four) of the poverty level.

The ACA was to have employers report whether they were offering employees “affordable” care. Now with the employer mandate delayed, exchanges may accept applicants’ statements that they qualify for subsidies without further verification.

Another wrinkle in the program could limit access to care. If enrollees pay one month’s premium, exchanges must provide a grace period of three consecutive months during which coverage cannot be terminated. However, insurers are only required to pay claims during the first 30 days of the grace period.

Thus, patients with valid insurance cards in hand can seek treatment at a doctor’s office on day 31 through 90 of the grace period. When the physician in good faith submits a claim to the insurer, the claim can be denied. Although the physician can bill the patient, realistically, many patients simply will not pay.

Chalk up another win for the insurance industry, which has off-loaded two-thirds of the risk of nonpayment onto physicians.

ObamaCare ignores human nature. Despite the claimed efforts to have patients adopt behaviors that help control costs, two recent studies in the journal Health Affairs demonstrate that people do not change merely because you tell them to.

Uninsured and Medicaid patients reported that they preferred care in an emergency room to a doctor’s office. For Medicaid patients the financial cost of an ER visit and the physician’s office were similar, but the ER was more convenient. The uninsured reported the cost of office care was higher because of additional testing or specialist visits.

Another study revealed that a majority of patients didn’t want costs to enter into their medical decisions. Some participants even chose expensive care “out of spite” because of antagonism toward their insurance company.

Hucksterism cannot overcome reality. Government efforts at mass control are doomed.

Successful reform requires innovation, maximization of personal engagement with medical treatment, and minimization of third party involvement. ObamaCare does the opposite.

Dr. Marilyn M. Singleton, MD, JD is a board-certified anesthesiologist and member of the Association of American Physicians and Surgeons (AAPS).

Dr. Marilyn Singleton ran for Congress in California’s 13th District in 2012, fighting to give its 700,000 citizens the right to control their own lives.

Congressional candidate Dr. Marilyn Singleton presented her views on challenging the political elite to physicians at the Association of American Physicians and Surgeons annual meeting in 2012.

Follow Dr. Marilyn Singleton on Twitter @MSingletonMDJD

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