Consumer Power Report #132

Published June 20, 2008

This issue is devoted to physicians, especially the bungling of the AMA as it flushes its principles down the toilet to get a “seat at the table.”

A physician in a leadership position from Massachusetts explained to me that they sacrificed the idea of balance billing in private contracts as well as in Medicare in order to get cooperation from AARP on some other issues. I responded with:

With all due respect, if the AMA doesn’t take principled positions, who will? If you hide your principles to avoid offending potential allies, those principles will soon disappear and be forgotten. I would hope that when I go to a doctor, he or she would tell me the truth even if it is something I don’t want to hear. Am I too fat? Should I stop smoking? How long do I have to live? Will my baby be born healthy or does it have Downs? Once I hear the truth I can make a decision on what to do. If you tell me something you know is wrong just to avoid offending me, how can I make a good decision?

If you believe balance billing is a bad thing, you should oppose it, and I would respect you for doing so, even if I might disagree. But if you think it is a good thing, but don’t say so just to avoid irritating others, how can I trust anything you say?

Organized medicine has a special responsibility to speak the truth no matter how powerful its opponents may be. Doctors cannot play the role of political hack. They aren’t very good at it, and it diminishes their profession.

Readers Response

Things are crazy out there. Here are some reports from the field.

From Eric Novak, MD, Arizona Freedom of Choice in Health Care Campaign

I am very excited to be able to say that we have gathered more than enough signatures to qualify for the Arizona ballot in November. We will likely turn in over 330,000 signatures, well over our estimated need of 300,000. As you all know, there will still be many more mountains to climb between now and victory in November. The language is reprinted below. Our website (which will get a redesigned roll out in the beginning of July) is .

The Freedom of Choice in Health Care Act
an amendment to the Arizona Constitution

Because all people should have the right to make decisions about their health care, no law shall be passed that restricts a person’s freedom of choice of private health care systems or private plans of any type. No law shall interfere with a person’s or entity’s right to pay directly for any lawful medical service, nor shall any fine or penalty, of any type, by imposed for choosing to obtain or decline health care coverage or for participation in any particular health care system or plan.

I look forward to everyone’s continued support and enthusiasm for the Initiative as this election season progresses.

From Molly Sandvig, Physician Hospitals of America

It has been confirmed by several sources within the House that late last night the House version of the Supplemental Appropriations Bill was finalized with Administration. The agreed upon version of the bill DOES NOT contain the physician ownership language. The White House and our Congressional champions in the House held firm in support of physician ownership — our industry will no longer be used as a pay-for or offset on the House version. The negotiated bill is expected to be before the House for approval today. At this point, it is not clear whether the Senate will accept the House negotiated language. However, due to Congressional interest in passing this bill very soon, we should know shortly whether the Senate confirms the House’s negotiated package or decides to amend it. As additional information becomes available, I’ll pass it along! Thank you for your hard work on this issue! It is clearly paying off.

From David McKalip, MD, Delegate to the AMA and Chair of the Council on Medical Economics for the Florida Medical Association

Despite the best efforts of many individuals, the AMA just officially declared their final vision for health system reform at the Chicago Annual Meeting that ended today.

1. Tax Credits for those <$50K (58 percent of population) phasing out to zero at some income that will likely end at about 80-100K. ($144 billion wealth transfer)

2. NO (none) tax deductibility or exclusion or any other tax benefit for HSAs, individual purchase of insurance, employer purchased or otherwise (if you’re not “poor” — no tax help).

3. Health insurance Mandates for all.

All of this will be supported by $16.8 million in alarmist and inaccurate propaganda on “47 million uninsured” through November and beyond. It is time to come together and raise the alarm about this to the American People. Getting press on the complete loss of tax benefit should help make their job harder early.

Where Is the AMA These Days?

The Buffalo News writes that new AMA president Nancy Nielsen made “a passionate and forceful call for national health reform” at her acceptance speech at the AMA. Among other things, she said, “I don’t see why we can’t divorce the financing of care from ownership of the insurance.” The article also said, “She also warned government officials to get out f the way while the private sector tries to reform medicine.”

Hooray for both those sentiments — if she means what it sounds like. I wonder, though. The AMA doesn’t sound like it is asking government “to get out of the way,” and a mandate to have health insurance sure doesn’t sound like it is divorcing financing from the ownership of health insurance.” I guess time will tell.

SOURCE: Buffalo News

It appears the AMA has drastically changed the position it outlined on its “Voice for the Uninsured” web site. While I am no great fan of this campaign because it exploits and misrepresents the true condition of the uninsured, the policy prescriptions aren’t at all bad. They include “Three Pillars:”

1. Subsidies for those who most need financial assistance obtaining health insurance.

It points out the regressive nature of the current tax exclusion and says that this is upside down. It calls instead for “tax credits or vouchers (that) should be more generous at lower income levels and should be earmarked for health insurance coverage.”

2. Choice for individuals and families in what health plan to join.

This idea equalizes the advantages of individual and employer group coverage, though the AMA clearly tilts in favor of individual coverage. It says, “If enough people have enough purchasing power insurers will be compelled to offer better, more affordable coverage options.”

3. Fair rules of the game that include protections for high-risk patients and greater individual responsibility.

This principle calls for “streamlined, more uniform health insurance market regulations.” It wants to encourage “market experimentation” while retaining a guarantee that people “will not lose coverage or be singled out for premium hikes due to changes in health status.” It wisely cautions that, “Market regulations intended to protect people who have high health risks typically have backfired, sometimes disastrously, by driving up premiums for younger healthier people and leading them to drop coverage.” On the personal responsibility side, it suggests that people who remain uninsured when they can afford to be covered “should face tax implications.”

I suppose it is possible to get from “face tax implications” to mandatory coverage for all, but it is quite a stretch. But being “more generous” to the lower income doesn’t mean taking the tax break away entirely from the higher-income. In fact such a change of policy would mean an enormous tax increase for many Americans that would be politically disastrous. A better idea would be to transition gradually by starting with equal treatment for everyone. And being “earmarked for health insurance” must include HSAs. Surely the AMA understands the problems with third-party payment for routine expenses.

SOURCE: AMA “Voice for the Uninsured” Campaign

Physicians in the News

The AMA has been busy on a lot of other fronts, as well. It issued its first “report card” on insurance companies this week. According to press reports, it found that “UnitedHealthcare had the lowest rate of contract compliance — 62 percent of medical services billed were paid (by the company), compared with 71 percent for Aetna and 98 percent for Medicare.” The article cites CHCC member Marcy Zwelling, MD as being “so frustrated with the time and cost of making sure she was paid accurately by insurers that she stopped dealing with them.” Of course, it is hard to imagine that Medicare is some paragon of timely payment, but the finding gives fodder to those who would make everyone be on Medicare. Lawrence Casalino, MD, is quoted as saying, “There’s no question that administrative costs for doctors and the country would be a lot lower in a single-payer system.”

SOURCE: Associated Press

The AMA also “established guidelines for medical tourism” according to Joanne Wojcik in Business Insurance. The article notes that 150,000 Americans go abroad every year for medical care. The guidelines deal with such concerns as referring patients only to accredited institutions, compliance with HIPAA in the transfer of medical records, that coverage be provided for follow-up care in the States, and so on. But the article also says that the AMA “plans to introduce model legislation for state lawmakers to consider.” Now that is an odd twist. What does state legislation have to do with foreign travel? And it is disturbing that the very first recourse for the AMA would be to seek legislation in any case.

SOURCE: Business Insurance


Writing in the Dallas News, Dr. Robert Kramer discusses the problem of insurance companies second-guessing his prescription decisions. He writes that he has been practicing medicine for 50 years and he always listened to his patients. “Taking care of my patients wasn’t — and couldn’t be — a cookie cutter exercise. Each patient was unique and required care based on his or her medical history and clinical findings.” In the intervening years he has found increasing pressure from third-party payers to switch to lower cost and less effective prescriptions. He says, “For the sake of everybody’s health we must allow decisions regarding medications to be made by the physician — and only the physician. Insurance companies are not licensed to practice medicine.”

SOURCE: Dallas News

In Jacksonville Florida, the Times-Union writes that Dr. Jeremy Lazarus says by cutting payments to physicians, Medicare is forcing doctors to go part-time, retire early, or go into other professions. All of the fancy campaigns on the uninsured that the AMA is pushing won’t help physicians if third-party payers don’t pay enough to stay in business.

SOURCE: Jacksonville Times-Union


But there can be no more compelling testimony on what physicians are facing than the farewell address by Doctor Ian Bogle, when he stepped down as Chairman of the British Medical Association on June 30, 2003. The speech is really quite poignant because he indicates that physicians in Great Britain made the same mistakes that American physicians are in the process of making.

He says, “I accept, like all of us do, that national standards, quality markers and assessment of individual and team performance are essential in a modern, patient-centered NHS.”

But this acceptance, the desire to get-along-by-going-along, the desire to “have a seat at the table,” is precisely what brought about the bone-crushing regimentation of Medicine he bemoans in the rest of his talk.

He tells a story from when he was a young physician of saving the life of an 7-year old boy with heart failure who had been sent home to die. Dr. Bogle went against the conventional wisdom and gave the lad “four times the recommended adult dose of a powerful diuretic new on the market.” It saved his life, and today he is “a strapping 48-year old with children of his own.” But, Dr. Bogle says, “I wouldn’t take that risk now. I am in no doubt that my career would be on the line if I acted outside accepted protocols for the treatment of certain conditions.”

Doctor Bogle goes on to describe what medicine is like in the UK Today:

Ministers and managers have muscled in on the doctor-patient relationship, and we now have a healthcare system driven not by the needs of individual patients but by spreadsheets and tick boxes.

Clinical decisions have been taken out of clinicians’ hands and the fundamental NHS principle of care based on need and need alone has been superseded by the principle of care based on numbers.

Targets are set nationally without any appreciation of what they might mean for individual doctors sitting in consulting rooms with individual patients.

If you set targets for the treatment of one group, you automatically disadvantage others whose clinical need may in fact be greater.

If you set targets for access to services, you encourage those providing the services to give more thought to throughput of patients than to what is actually wrong with those patients and what their individual treatment needs are.

It is an eloquent statement that should be must-reading for anyone in health policy today. But it must be said that all this was brought on by the naiveté and credulousness of Dr. Bogle and the British Medical Association that persists today. They continue to “accept national standards, quality markers and assessment of individual and team performance.” And that is what enabled the bureaucrats to tell them how to practice medicine. It is the exact same mistake the AMA is making today — sacrifice your principles to “get a seat at the table.”