Trump’s Healthcare Transparency Round 2

President Trump’s second go–round with healthcare pricing marks the first time I can recall a consistent effort on his part to achieve a goal in the face of opposition. Something sadly lacking in the immigration fight.

Daryl Cagle, caglecartoons.com

January was his first attempt. The Department of Health and Human Services required hospitals to begin posting ‘Chargemaster’ rates for medical procedures on their websites. The goal was to give consumers access to price information on medical procedures that had been negotiated with the government.

The Chargemaster is a typical government conspiracy against the taxpayer. It’s so complicated only industry insiders and federal employees have even a remote chance of grasping any useful information. It lists every possible treatment a customer can be subjected to, broken down into individual components.

Trying to estimate what it would cost to deliver a baby is like determining the cost of a new car by adding up the price of every individual part contained in the car. Even worse, those prices don’t reflect lower negotiated prices. That level of complexity and irrelevance still wasn’t good enough for the Uriah Heeps inhabiting hospital executive suites.

The regulation specified Chargemaster prices had to be published in a “computer friendly” format, so some of these parasites published the data in a format only a computer could understand. NBC found,”…[hospitals] made their prices available as JSON or XML documents, file formats more often used by programmers and data analysts than consumers.”

Back to the drawing board.

This time Trump signed an executive order directing bureaucrats to write a regulation requiring hospitals to post prices including “standard charge information, including charges and information based on negotiated rates and for common or shoppable items.”

That vagueness is what bothers me. What qualifies as a “shoppable item.” Is a bandaid shoppable, while a tonsillectomy isn’t? Knowing the price difference between a bandaid at MegaCare and CVS is not going to be useful, while knowing the difference between the cost of hysterectomy (I’m trying to be inclusive) at Catholic Charity Hospital and Pagan Price–Fixer Hospital is.

How much usable information consumers gain from Trump’s executive order really depends on whether or not the bureaucrat writing the regulation plans to go to work for a hospital or insurance company after he leaves government ‘service.’

Even that ominous prospect for consumers is too uncertain a variable for the Healthcare Industrial Complex. According to them any knowledge is a dangerous thing in the hands of a civilian. Rick Pollack, a professional liar for the American Hospital Association, claimed during an interview with Modern Health Care, “Publicly posting privately negotiated rates could, in fact, undermine the competitive forces of private market dynamics, and result in increased prices.”

My challenge to readers is to add the word ‘cars’ or ‘new homes’ to that sentence and try not to laugh.

The other disquieting news is that price disclosure could be interpreted to mean out–of–pocket cost for the patient. High health insurance deductibles sometimes provide a perverse incentive. Some potential patients may choose the highest out–of–pocket expense to satisfy all his  deductible and make the rest of that year’s care “free.”

Making a dent in healthcare costs requires a two–pronged approach that provides information to consumers and an incentive to price compare.

Simply require hospitals to post the lowest turnkey prices for the 25 most common surgical procedures; the 25 most common outpatient procedures and the 25 most common tests. The government should know what it’s paying for, so generating this list is easy.

Second, give consumers an incentive to choose a lower price by sharing the saving with him. For instance, charges for a knee replacement vary from $32,500 to $22,700.

Instead of pocketing the $9,800 saved by choosing the lower cost option, encourage insurance companies to share by applying ten percent of the savings to the patient’s deductible for that year. The patient would pay ten percent of the procedure ($2,270) and the insurance company would apply ten percent of the savings ($980) and their deductible for the year would be satisfied.

To ensure this wasn’t a one–time–only cost–conscious decision by the consumer, the insurer could continue to apply ten percent of procedure savings to future deductibles.

My proposal is simple, clean and understandable and it will work to lower healthcare costs. This is why there is no chance swamp bureaucrats will follow my advice.

Instead I fear we will still be stuck in a situation Sen. Angus King (I–ME) aptly described to the Wall Street Journal, “I know of no other business [healthcare] where you have no idea what something’s going to cost, and you can’t find out even if you ask.”

Sen. Mike Braun’s Backwards Healthcare Reform

Two years too late a senator has finally taken a tentative step toward increasing competition in the healthcare market, lowering insurance costs and removing the dead hand of Obamacare from the nation’s throat. It’s partial implementation of a plan I’ve advocated, but it repeats my mistake and unfortunately adds a new one.

Rick McKee, The Augusta Chronicle, GA

It’s unfair to blame Sen. Mike Braun (R–IN) for being late since he wasn’t in the Senate when Republicans frittered away Obamacare repeal. The problem is his bill attacks cost from the wrong end.

Braun’s plan is called the True Price Act. As he told Breitbart.com, his plan “would require insurers to disclose the negotiated price for each medical service covered by a person’s insurance plan and any cost-sharing amounts (co-pays or deductibles)…The bill would require the prices to be posted on the insurer’s website and in paper form.”

That’s backwards because the insurance companies can’t predict what hospitals charge for a procedure because charges vary according to the rapacity of the facility. Braun says he wants to reverse concentration in the health insurance market by “by making it transparent and competitive, letting the best providers survive.”

His bill would only encourage concentration and limit consumer choice because the only way an insurance company can be certain of a procedure’s cost is if the insurer limits coverage to hospitals it controls or with which it has negotiated an agreement.

The People’s Republic of Maryland proves my point. The Maryland Health Care Commission has a limited program that compares turnkey prices for common procedures affecting patients who are either women, old or both. It found Sinai Hospital charges $32,500 for a knee replacement, while UMD Medical Center at Easton charges over one–third less at $22,700, with fewer readmissions from complications. 

Braun would accomplish more by requiring hospitals that accept federal money to post turnkey charges and forget the insurance companies.

Then Braun repeats my initial mistake and ignores consumer motivation. Most medical shoppers, like whiskey drinkers, tend to associate high cost with high quality, when that isn’t the case. For a patient with a $3,000 deductible it makes both economic and status sense to choose the more expensive hospital. Ten percent co–pay on the costlier procedure wipes out his deductible and the rest of his health care that year is ‘free’!

A better solution is for the feds to encourage insurance companies to give the patient an incentive to be a comparison shopper by sharing the savings when he chooses a less expensive option. Instead of pocketing the $9,800 saved by paying for the knee replacement at UMD Easton, the insurance company could share by applying ten percent of the savings to the patient’s deductible for that year.

The patient would pay ten percent of the procedure ($2,270) and the insurance company would apply ten percent of the savings ($980) and his deductible for the year would be satisfied.

To ensure this wasn’t a one–time–only cost–conscious decision by the patient, the insurer could continue to apply 10 percent of procedure savings for the rest of the year to the patient’s deductible in outlying years.

This is good for the company because it reduces customer churn by giving the patient a reason not to change policies and the customer saves money on future annual deductibles.

Braun is right that cost transparency will encourage competition, but the place to start isn’t with the middlemen. It’s with the hospitals that generate the cost. Currently the consumer has severely limited options when buying insurance. It’s either the price set by the socialized premium mavens at Obamacare. Convert to Christianity and join a cost–sharing plan. Or join millions of uninsured illegals crowding the emergency room.

Sen. Braun would do better to allow insurance companies to offer coverage options and sell across state lines without crony capitalist interference from the various legislatures.

Combine that with price transparency for hospitals and incentives for procedure shopping on the part of patients and healthcare prices will finally start to go down.

The next step will be selling freedom of choice to the public and talking panicked Republicans off the ledge. But that’s another column entirely.

Hospitals Guard Prices Like the CIA Guards Secrets

Way back in 2017, before we were on the Road to Nuremberg With Donald Trump, the Washington Post was outraged that hospitals were trying to make a profit. Like most stories involving reporters, economics and healthcare it was both wildly inaccurate and agenda–driven.

Adam Zyglis The Buffalo News NY

The story’s one useful service was it introduced the public to the slightly ominous term “Chargemaster.” At first glance, the term “Chargemaster” might be mistaken for the cause of the so–called epidemic of “mass incarceration.” A fiendish device district attorneys use to jail minorities captured during the government’s regular sweeps in low–income areas.

Even for those who haven’t been to jail, the term has unsavory associations bringing to mind arrogant, price–gouging, monopolies who look upon customers as rubes to be exploited. (Ticketmaster, come on down!)

In reality, the “Chargemaster” has more to do with pricing than policing. Theoretically, it’s a complete listing of all the services and procedures a hospital provides patients, followed by the cost for each item.

What the consumer doesn’t know is the price listed after any procedure is as hyperbolic as an entree description on a Trump restaurant menu. The cost paid by Medicare or a health insurance company often bears little relation to what’s listed on the Chargemaster. Just as the window sticker on a new car is only a starting place in the negotiation.

The US healthcare market is currently designed to guarantee high prices, encourage waste and discourage price shopping. That’s because consumers can get a binding estimate on building a house, but they can’t get any kind of estimate on removing a gall bladder. Requiring hospitals to post the Chargemaster on the web is supposed to give consumers this vital information, but in truth all it will give most of them is a headache.

I predict it will be easier to read the privacy agreement for Facebook victims than it is to comprehend the Chargemaster. If it were up to hospital administrators consumers wouldn’t even be able to find out what it cost to park until they tried to exit the lot. Instead of a simple procedure equals cost equation, the consumer will no doubt have to assemble the procedure himself, which is just how the hospitals want to keep it.

Maryland made a tentative effort to lift the cost veil. The Maryland Health Care Commission has a website with the inane name of “Wear the Cost,” which sounds like the surgery bill will be tattooed on your backside. Instead, it compares turnkey prices for common procedures affecting patients who are either women, old or both.

Consumers who fit within that medical straightjacket can finally see what hip replacement, knee replacement, hysterectomy and vaginal delivery prices are at 21 different hospitals. Unfortunately, hospital patients, like whiskey drinkers, tend to associate high cost with high quality. That’s not necessarily true as the medical complication and readmission rates for the procedures at various hospitals demonstrates.

Patients can have high–quality care for lower cost if they will only do their research among these limited options.

The feds need to build on the Chargemaster unveiling by demanding all hospitals that accept federal money post binding prices on the web for the 25 most common surgical procedures; the 25 most common outpatient procedures and the 25 most common tests. The listed, turnkey charges must also match the best price offered insurance companies.

That’s half the battle. The other half is getting the consumer to act on the information. In Maryland Sinai Hospital charges $32,500 for a knee replacement, while UMD Medical Center at Easton charges over one–third less at $22,700, with fewer readmissions. If the patient has a $3,000 deductible and the co–pay is 10 percent, many would still choose the more expensive Sinai because it wipes out their deductible and all the rest that year’s healthcare is ‘free’!

Smart insurance companies would give the patient an incentive to be a smart shopper by sharing the savings. Instead of pocketing the $9,800 saved by paying for the knee replacement at UMD Easton, the insurance company could share by applying ten percent of the savings to the patient’s deductible for that year.

The patient would pay ten percent of the procedure ($2,270) and the insurance company would apply ten percent of the savings ($980) and their deductible for the year would be satisfied. To ensure this wasn’t a one–time–only cost–conscious decision by the consumer, the insurer could continue to apply ten percent of procedure savings to future deductibles. This is good for the company because it reduces customer churn by giving the patient a reason not to change policies and the customer saves money on future deductibles.

That’s an ideal situation. What we have is Confusionmaster and that’s probably where the feds will call it quits.

How Dare Catholic Hospitals Protect the Unborn!

FiveThirtyEight.com is an Opposition Media website that assures us of its superiority and authority: “FiveThirtyEight uses statistical analysis — hard numbers — to tell compelling stories about elections, politics, sports, science, economics and culture.”

What that glowing description leaves out is that FiveThirtyEight reporters also use bias and selective ‘facts’ to color how they report their “hard numbers.”

Rick McKee The Augusta Chronicle, GA

And speaking of firmness, the website appears to have a bone of contention with Catholic hospitals in the US.

Even we low–information Trump voters know there is an “opioid crisis” in rural America. It’s so bad that even normally disdained rural whites are getting sympathetic news coverage. Simultaneously, there’s another rural crisis that affects everyone in the boondocks, druggies and deplorables alike. As drugs move in, hospitals are moving out. For–profit hospitals leave because low incomes and low population density make it difficult to justify operating a hospital in the hinterlands.

When small town hospitals close it leaves residents without healthcare options. Below is a sampling of relevant headlines:

A Hospital Crisis Is Killing Rural Communities. This State Is ‘Ground Zero.’

Hospital Closings Likely to Increase

Nearly 700 rural hospitals at risk of closing

After that one would think any organization keeping rural hospitals open would be the beneficiary of praise and congratulated for their compassion for rural Americans. But not so fast. That thinking might get one fired at FiveThirtyEight.

Anna Maria Barry–Jester and Amelia Thomson–DeVeaux (beware of reporters bearing hyphens) examined one organization that still operates rural hospitals and found it wanting, and even worse, religious. “In a growing number of communities around the country, especially in rural areas, patients and physicians have access to just one hospital. And in more and more places, that hospital is Catholic.”

Now I can understand if the hospital was operated by Mormons it might be tough to get a cup of coffee in the cafeteria, but what could be wrong with Catholics? After all, the word ‘hospital’ comes to us from the Knights Hospitaller, an order dating back to the Crusades.

The danger is evidently intrinsic to being a Catholic. “What happens when you need or want a standard medical service, but the hospital won’t provide it?”

A hospital that won’t provide “standard medical service”? That does sound ominous.

I know Catholic doctrine considers homosexual practice a sin, but that shouldn’t rule out a colonoscopy. Passing out drunk is frowned upon, too, but I don’t think anesthesia is banned. Suicide is certainly a no–no, but I’ve never read of a Catholic hospital forcing those who attempt self–murder to visit a Satanist for treatment.

So what are these “standard medical services”?

The “hard numbers” reporters explain, “…abortion, birth control, vasectomies, tubal ligations, some types of end–of–life care, emergency contraception and procedures related to gender transition can all be off-limits if your local hospital happens to be Catholic.”

Translation: If you want an abortion, assisted suicide or to have your body vandalized so you can claim to be a woman (or man) when you’re not, a Catholic hospital is not a good place to go for an estimate.

The other “standard” procedures relate to birth control and even those in the grip of the strongest passion can pop into Walmart for stopgap measures, until they make their way to the big city.

As Becket Adams, who found the story, pointed out, “Remember, this is an article is about Catholic hospitals servicing poor and isolated rural areas where other medical organizations don’t or can’t operate.”

One would think the left would be celebrating Catholic’s commitment to the rural poor isolated by the closure of evil profit–making hospitals. Instead the hyphen twins twist facts to make Catholic hospitals look malign.

In Cook County, not a rural area, the Pope’s practitioners are made to appear sinister because Medicaid patients were enrolled “in a plan where Catholic hospitals made up a bigger share of in-network facilities with labor and delivery departments than the share they accounted for in Cook County as a whole.”

What they don’t tell readers is why. That’s because Catholic hospitals will accept any Medicaid patients, while many for–profit hospitals won’t accept the same patients because the reimbursement rates are very low and the checks come very slow. Catholic hospitals are ‘over represented’ because the for–profit hospitals wanted out.

Instead of the praise Catholic hospitals deserve for continuing to serve the poor and isolated, these religious institutions are pilloried in the media because Catholics refuse to provide an altar for the left’s sacrament of abortion and its celebration of sexual license and dysfunction.

In spite of the FiveThirtyEight criticism, I imagine that even rural atheists are glad they have a hospital, in spite of the fact it’s run by Catholics.

Ryan’s Obamacare Lite Is Another Travesty & Betrayal

Freshman Rep. Moira Walsh had an unusual explanation for some of the bad lawmaking in her state capital during an interview on Rhode Island’s WPRO, “It’s the drinking that blows my mind. You cannot operate a motor vehicle when you’ve had two beers but you can make laws that effect people’s lives forever when you’re half in the bag?

Too bad Moira isn’t in Congress. Booze would be a more acceptable explanation for Paul Ryan’s Obamacare replacement bill than the truth, which is this bill is a betrayal of conservatives seven years in the making.

As the Heritage Foundation points out this slap in the face protects the Democrat base that got free or heavily subsidized coverage at the expense of the GOP base that earns the money to pay for Democrat’s discount insurance.

As I’ve pointed out to friends in the past the price of an Obamacare policy isn’t bad if you remember your premium is buying two policies: One for your family and another for the moochers.

Ryan evidently believes Republican meddling in the health insurance market is such a big improvement over Democrat meddling that he’ll rule for decades. The truth is the base didn’t vote to swap incompetent meddlers we don’t know for incompetents we do know.

Our mistake was believing the lie that once Republicans controlled all three branches of government they would repeal Obamacare.

My doubts began when “repeal” was amended to “repeal and replace.” Why replace Obamacare’s socialized medicine with the Republican’s Obamacare Lite?

A simple return to the situation that existed before the passage of Obamacare could mean a reduction of up to 30 percent in the cost of insurance premiums and the return of the missing doctors. That alone should be enough win re–election.

The insurance market circa 2008 will cause problems in the dependency class that doesn’t like their handouts interrupted. But I have news for Ryan and his RINO gang — they don’t vote for you anyway. Your voters are the people this bill continues to burden.

Ryan and the rest of his brain trust would rather betray the voters who supported them than risk headlines from the Opposition Media about taking free insurance away.

Ryan’s bill fails in three major areas.

First it does nothing to increase competition in the insurance market. Insurance companies still can’t sell nationwide, the “lines around states” Trump mentioned in the debate. This change alone would lower prices because companies would compete against each other. That’s why you can afford homeowner’s insurance and you can’t afford health insurance.

Second it does nothing to lower prices because the onerous and expensive coverage requirements for every policy are still included. If the consumer wants to buy a policy that covers him from Q-tip to transplant, fine he can pay for it. But if all he wants is major medical, he should be able to make that choice.

Finally it penalizes Republican states that didn’t expand Medicaid and rewards Democrat states that ran up a tab on Uncle Sam. The bill promises this will be phased out in the future, but we’re supposed to believe a Republican Congress that won’t boot 25–year–olds off daddy’s policy today will find the backbone to cut Medicaid tomorrow?

This debate isn’t really about health insurance and discussing it in those terms lets leftists set the parameters. This debate is about personal liberty. The liberty, as an adult, to make your own decisions regarding the future.

Government isn’t the national airbag saving the impudent and foolish from the consequences of their own stupidity. This only encourages more irresponsibility among the demographic whose only long–term commitment is a tattoo.

Healthcare isn’t a right. You don’t have the right to make someone go to medical school, graduate and then treat you for a price you think is reasonable, any more than you have a right to make the barber cut your hair.

I hope there are enough conservatives in the House to defeat Ryan’s disingenuous travesty. Because if they don’t it, means Obama won.

It’s obvious only difference between Nancy Pelosi as Speaker of the House and Paul Ryan is velocity. The train just moves slower and the conductor’s assurances are less believable under Ryan, but the final destination is still Greece.

Passage of this bill will raise a very pertinent question for conservatives: Why do you have a stronger belief in conservative principles and the power of the free market than the politicians who get your vote?

Why should we pretend anymore?

My suggestion next November is vote for the politician who promises to give away the most; at least he’s not a hypocrite. Maximize benefits now and hope the money doesn’t run out until after you’re dead.

Should the Feds Start Price–Fixing Hospital Charges?

The Washington Post headlined an alarming story that accused hospitals of trying to make a profit: “Fifty hospitals in the United States are charging uninsured consumers more than 10 times the actual cost of patient care…”

Gerard Anderson, one of the study’s authors, comments, “…consumers are paying for this when hospitals charge 10 times what they should. What other industry can you think of that marks up the price of their product by 1,000 percent and remains in business?”

Bottled water comes to mind along with women’s shoes, illegal drugs, cosmetics and Comcast.

The entire study displays an almost total lack of understanding of how any market works. The solution to the problem is more information and that’s something government can encourage.

Details in my Newsmax.com column:

http://www.newsmax.com/MichaelShannon/Healthcare-Reform/2015/06/12/id/650307/

Congressional Obamacare Hypocrisy: They Get the Subsidy, Taxpayers Get the Bill

Sen. David Vitter (R–LA) is in lonely fight against Congressional Obamacare hypocrisy.

Republicans claim to be against Obamacare, yet many protect their staff, along with their health plans, from the same federal meddling, cost and inconvenience taxpayers must suffer. One expects that from Democrats but it’s infuriating from Republicans.

Vitter has been trying to end this shuffle for more than two years.

Now there may be hope that Vitter will succeed with a little help from you over the Christmas and New Year holidays.

Complete details in my Newsmax column at:

http://www.newsmax.com/MichaelShannon/Congress-Staff-Taxpayers-Vitter/2014/12/12/id/612685/

Veterans Are the Healthcare Canary in a Coal Mine

JeffDarcy VA scandalBetween today and June 6th’s 70th anniversary of the D–Day landing I want you to find a veteran and talk to him. This doesn’t mean cornering some unsuspecting vet and ambushing him with the latest insipid leftist cliché: ‘Thank you for your service,’ which manages to be both pretentious and condescending.

(However, it is an improvement over the left’s former greeting for vets: ‘How many babies did you kill today?’ But it’s still rote trivialization.)

Ideally your vet should be a veteran of either the Korean Conflict or the Vietnam War. Not because the fighting was far enough in the past be non–controversial, but because this vet has had plenty of time to experience the tender mercies of the Veterans Administration health care system.

And that system should be the main topic of conversation, because if the left has its way, everyone will experience this type of health care under the coming Obamacare regime. Don’t make the mistake — encouraged by the cheerleading mainstream media — of believing the VA is a problem unto itself and has no relation to civilian health care and certainly no relevance to the future of Obamacare.

That is spin and it is completely untrue. The VA hospital system is essentially the pilot program for Obamacare. It’s been a single–payer system from the beginning and single–payer is the ultimate goal for Obamacare. The VA system was designed to accommodate a smaller subset of the population and it was immune to competition from the private sector. Think of it as the United States Postal Service with syringes.

The theory is after the bugs have been worked out of the pilot program, then a benevolent government can expand it to accommodate the entire country. Unfortunately with leftist big government, when a pilot program fails the verdict is always the failure was due to a lack of resources. The cure is to take the same program, bulk it up with taxpayer dollar injections and make it mandatory for the entire country.

So the VA is very relevant to Obamacare

Our veterans have been used as guinea pigs since 1930 when the VA was founded. One would think 84 years is long enough to get the kinks worked out of the program, but one would be wrong. VA hospital horror stories have been a staple of government scandal coverage for years.

If you fall for the ‘it’s just the VA and won’t affect civilians’ cover story then you are believing what the Obama administration wants you to believe. The goal of the White House is to keep the VA scandal bottled up in a silo off to one side. Obama wants you to think it’s just a rogue VA hospital in Arizona that cooked the books.

But it’s not just Arizona. It’s Florida, it’s West Virginia, it’s Missouri, it’s all over the country. And the problem can’t be solved because there is no real penalty for failure and no competitive pressure to excel. And the same government that runs the VA will soon be running Obamacare if the left can expand it into a single–payer system.

My family has it’s own story of an encounter with the Oklahoma – Texas VA administration. One of my uncles — a WWII veteran — fell ill and went to the VA for treatment in the 50’s. The good doctors said he had suffered a nervous breakdown and they hospitalized him in the mental wing.

Today suffering a nervous breakdown means you are forever immune to negative job performance reviews and the Angel of Downsizing will probably pass over you, too.  But in the 50’s a mental problem was the kiss of death.

My uncle lost his career, his wife and his future. He was in and out of VA hospitals for two decades trying to find a cure so he could reassemble the shards of what had been a normal life. And then one fine day he got a new VA doctor. This doctor announced that my uncle had never had any mental problems and that all his difficulties had been caused by an undiagnosed and untreated brain tumor that had been growing in his skull since the first time he saw the inside of a VA hospital.

So my uncle went home to the bedroom he’d inhabited in my grandmother’s house since he lost everything he held dear. And he thought about his life. And he thought about what he had lost. And he carefully took a blanket off his bed, went over to the gas space heater, sat down on the floor, covered his head with the blanket and turned on the gas.

So my family knows all about VA medical care and we want no part of it.

These poor vets were promised first–class health care in return for going to war. Instead they received secret waiting lists, bureaucrat cover-ups, buck passing and incompetent care.

On the other hand the rest of us, that haven’t gone to war, have been promised we could keep our doctor and our insurance.

So find a veteran and ask him how the government keeps its promises.

The continual problems of the VA health care system are what the rest of the country will face if Obamacare isn’t stopped in its tracks. Government can’t run a smaller health care network and it certainly can’t run universal health care.

Our veterans have been the canary in the health care coalmine for decades, but Uncle Sam just keeps replacing the dead canaries with new ones.