Consumer Power Report #170

Published March 20, 2009

The news from Washington gets more disturbing by the day. It is interesting that many of President Barack Obama’s most stalwart supporters are becoming his most impassioned critics. Certainly Jim Cramer fits that category, as do several of the medical professors cited in the articles below. These folks tend to be traditional welfare state liberals who support raising taxes to provide assistance to the “less fortunate.”

They didn’t realize that this Congress and this administration would be cut from a whole ‘nother cloth. What is happening in Washington today is nothing short of a Marxist power grab. One small example was reported on in Friday’s Washington Post by Lori Montgomery and Ceci Connolly. They report that House Democrats are working with the White House to deliver an ultimatum to the Republicans– either go along with our health reforms by September or we will use “budget reconciliation” to cut you out altogether.

Budget reconciliation is a Congressional device that requires a simple majority to pass essential budget and tax provisions to keep the government running. It has never been used to cram major policy initiatives and new programs down the throats of the minority. It is profoundly undemocratic and belies the promises of “reaching across the aisle” and bipartisanship.

To use such a device to enact a massive, $2.1 trillion, 10-year, re-write of one-seventh of the national economy that directly affects the life and death of every American is frightening beyond belief. I, for one, have never been more worried about the future of our country.



James Bovard writes in the Washington Times that President Obama said, “We will make the immediate investments necessary to ensure that within five years all of America’s medical records are computerized.” Wow. All medical records within five years? I wonder what odds the Las Vegas bookmakers would give me on that one.

Realistic or not Mr. Bovard figures, “having a massive electronic database will make it far easier for the government to coerce both doctors and patients. This is a peril as bad or worse than the Patriot Act.” He adds, “While the Obama administration is showing the smiley face now, its plan calls for federal penalties for doctors who have not computerized their records by the year 2014.”

He notes that these “interoperable” medical records will include plenty of information on our behavior and our fears, especially if we have ever consulted a psychiatrist. He points out that psychologists were involved with the interrogation of prisoners at Guantanamo and says, “The same peril could face the millions of Americans who received psychological treatment if their records are fed into centralized databases.” This is reminiscent of the story of Winston Smith in Orwell’s 1984, who had a phobia of rats which was used to finally break his spirit.

SOURCE: Washington Times

In The Wall Street Journal Jerome Groopman, MD and Pamela Hartzband, MD, both on the staff of Beth Israel Deaconess Medical in Boston and on faculty at Harvard Medical School, write about “Obama’s $80 Billion Exaggeration.” They point out that the president has said, “his policies would be based on rigorous scientific evidence of benefit,” but his health IT proposal is precisely the opposite.

They write, “The basis for the president’s proposal is a theoretical study published in 2005 by the RAND Corporation [but] in the four years since the report, considerable data have been obtained that undermine their claims.” They call the proposal, “an elegant exercise in wishful thinking.”

They point out some of the negatives of such computerization, including that “once a misdiagnosis enters into the electronic record, it is rapidly and virally propagated, [and] once data are keyed in, they are rarely rechecked with respect to accuracy.” Hence electronic medical records can create errors where there were none before.

The authors offer several studies illustrating these problems and note that much of this was available when the RAND study was published, but the RAND researchers explained, “We choose to interpret reported evidence of negative or no effect of health information technology as likely being attributable to ineffective or not-yet-effective implementation.” So they deliberately disregarded any evidence of negative consequences.

The authors conclude that, though they both supported and voted for Obama, “we need the president to apply real scientific rigor to fix our health care system rather than rely on elegant exercises in wishful thinking.”

SOURCE: Wall Street Journal

And in the Washington Post Stephan Soumerai and Sumit Majumdar write that Obama in making a “Bad Bet on Medical Records.” The first author is a professor at Harvard’s Medical School and the second is at the University of Alberta’s Medical School. They write, “the benefits of health IT have been greatly exaggerated.” Specifically, they say, “Large, randomized controlled studies–the ‘gold standard’ of evidence–in this country and Britain have found that electronic records with computerized decision support did not result in a single improvement in any measure of quality of care for patients with chronic conditions including heart disease and asthma.” And, they add, “Health IT has not been proven to save money.”

Even more worrisome, they write, “evidence suggests that adoption of some computerized systems has not helped but harmed patients. After the Children’s Hospital of Pittsburgh added automated prescribing recommendations to a commercial electronic records system, the institution documented a more than threefold increase in the death rate among child patients. Another leading system contributed to more than 20 different types of medical errors.”

The authors conclude, “Before moving ahead, the administration should first consider conducting well-controlled research on the cost-effectiveness of health IT in office practices, which are the bulk of the U.S. medical system.” But that would require this administration to use evidence-based public policy, something it has proven unwilling to do. After all, why waste a crisis?

SOURCE: Washington Post


I have been wondering about the AMA for some time now. It has been helping to demagogue the issue of the uninsured in order to secure the famous “seat at the table” for the health reform discussions. It has made proposals to kill HSAs by making only insurance premiums tax deductible, and on a sliding scale at that. Insurance premiums would no longer reflect the underlying cost of coverage, but would be set by government dictate at a percentage of the consumer’s income. It has been cozying up to Families USA, the SEIU, and AARP, and ignoring the true friends of medicine and physician autonomy. I have been puzzling over whether this is all driven by some naïve political calculation that hoped to trade off principles in exchange for better payment under Medicare, or if the AMA leadership had really become as socialistic as it seemed.

But now comes current AMA President Nancy Nielsen with a hope that not all is lost. An article by John Commins in HealthLeaders Magazine says, “the nation’s largest physicians’ organization warns that any attempts by the federal government to use evidence-based medicine to dictate how physicians provide individualized care would be a deal breaker.” Dr. Nielsen is quoted as saying, “Government control of the doctor-patient relationship is a no deal. People who think that ‘we just put out a guideline and if you don’t follow it, we will smack you down,’ well, it isn’t that simple because patients aren’t that simple.”

The article notes, “(Peter) Orszag has said that evidence-based medicine could be used as a financial incentive to guide physicians toward cost-effective care.” To which, Dr. Nielsen responds, “Peter is not a physician and we are going to help educate him. He is a good man and a smart man and he has studied a lot about healthcare. He knows that we can do better and we can. We are going to help everyone who needs to understand that sometimes there are reasons why you don’t do what the guidelines say.”

On the other hand, Bill Roper, MD, former head of CMS and the CDC, says, “the public will most assuredly have to make sacrifices in their own health care services to make any meaningful reforms work.” He goes on, “To cover those other approaching 50 million uninsured people means taking something that is currently being spent on you and me and spending it on a person without health insurance. That by any other name is a sacrifice.”

The article goes on, “Roper says evidence-based medicine ‘means we will come up with better information on what works in what setting and that means we will say ‘no’ to your request for knee surgery or x, y, or z procedure.'”

But Dr. Nielsen responds, “We really have to focus on the needs of the patient first and then we will definitely make sure that doctors can stay in practice. The last thing you want as a nation is to do something that is going to so demoralize those clinicians that they would hang it up and leave the practice.”

Well, good. Now that we have the AMA focused on physician autonomy, maybe they will extend that concern to patients, too. Let’s ensure that patients have the right to spend their money on the health care services they prefer, instead of being mandated to buy a government-dictated insurance plan.

SOURCE: HealthLeaders Media


WorkForce Management reports that Utah has enacted a new law that will enable employees to use their employer’s contribution to buy individual coverage. Basing premiums on health status is not allowed but age, area, and place of residence may be factored in. The article states, “the state will provide financial assistance to insurers through a nonprofit reinsurance pool that will be created by the state insurance department.” The law also will have some modest effect on malpractice suits related to ER treatment and will require state contractors to provide health benefits to employees.

SOURCE: Workforce Management

Unsurprisingly, the 9th Circuit Court of Appeals refused to consider the San Francisco law requiring employers in that city to provide health insurance benefits. The decision to not hear the case en banc was written by Judge William Fletcher, the same judge who wrote the original decision that was being appealed. A minority of eight other judges on the court wrote a sharply dissenting opinion, and the issue is sure to go on to the U.S. Supreme Court.

One of the plaintiff’s lawyers, David Bacon, said, “I think that there’s a very dramatic dissent here with eight judges, including Chief Judge Alex Kozinski, and I think the stage is very clearly set for a Supreme Court showdown.” But an attorney for the city said, “I think it’s unlikely that the Supreme Court will take the case.” I wonder if that Las Vegas bookmaker I mentioned above would like to accept a little wager on this one. Not only will the Supremes take it, but they will overturn the 9th in a blink of an eye. This ruling is a complete contradiction of every precedent the Court has ever set on ERISA.

SOURCE: National Law Journal

Michigan is still trying to figure out what to do with its Blues plan. The Detroit Free Press editorializes that “When Blue Cross Blue Shield of Michigan tried to ram through insurance reform during the Michigan Legislature’s lame-duck session last year, lawmakers were right to send the Blues packing.”

It says there are still issues that need to be resolved, but “to date, there’s no bill introduced in either chamber of the Legislature to address the Blues’ troubles.” The Blues have filed for a 56 percent rate increase for its individual policies–that’s right, 56 percent! They argue they need it because they are selling more individual policies and they are required to take all the bad risks. One of the things they proposed last year was a high-risk pool, but the paper is dismissive of that idea without much of an explanation. But it says, “this is far too important an issue to leave to last-minute politicking and emergency legislating.”

SOURCE: Detroit Free Press

Massachusetts continues to muddle through with its health plan in spite of unemployment in that state rising from 4.8 percent to 7 percent in the past three years, according to the Associated Press. “With the Obama administration hoping to expand health care nationally, the fate of Massachusetts’s program is being watched closely,” says the article by Steve LeBlanc. The article quotes KFF’s Drew Altman as saying, “People are going to be watching how it fares in the recession and how resilient it is and whether people will continue to be able to afford health care when they face other economic pressures.”

Apparently, the state covers people collecting unemployment for up to 46 weeks. But that doesn’t help folks like self-employed contractors. The penalty for not having coverage is severe this year, more than $1,000. This is well up from the $219 penalty that was assessed on 60,000 people last year. The AP story says people can get “affordable” coverage through the Connector, but the last time we looked a family could be covered in Connecticut for less than half of what coverage costs through the Connector.

People in the state are beginning to question the wisdom of mandatory coverage during an economic downturn. House Republican leader Brad Jones says, “We need to take a breath and remodel the system for a set of economic circumstances that weren’t foreseen when we were doing health care reform in the first place.”

SOURCE: Associated Press

More Massachusetts
And The New York Times says Massachusetts’s failure to address costs is “challenging.” It says, “government and industry officials agree that the plan will not be sustainable over the next 5 to 10 years if they do not take significant steps to arrest the growth of health spending.” The article says the state spends 33 percent more per person than the national average, which is up from 23 percent more in 1980, and “the task of cost-cutting remains difficult in a state with a long tradition of heavy spending on health care.”

The article goes on to discuss the problem in some detail but concludes with, “to truly change course, the state and federal governments may need to place actual limits on health spending, which could lead to rationing of care.” And it quotes Stuart Altman of Brandeis as saying, “Really controlling costs requires just stopping spending.” Alrighty, then, no problemo!

SOURCE: New York Times


If you haven’t noticed by now, the Left isn’t content simply to win elections and debate public policy. Their modus operandi is to crush all dissent and portray the opposition as not just wrong but evil.

So, when Richard Scott announced he was putting $20 million into a new organization he styled “Conservatives for Patient Rights,” the Left was outraged. Never mind that George Soros, the Commonwealth Fund, Families USA, and labor unions are spending 10 times that much to advance their cause. The idea that even a dime should be spent disagreeing with the Leftists is so offensive, that The Nation magazine immediately characterized Mr. Scott as “Healthcare Enemy No. 1” Why? Because he used to be involved in a for-profit hospital company (Columbia/HCA) and was quoted in The New York Times in 1994 as saying, “What’s happening in Washington is not health care reform. Health care reform is happening in the marketplace.” The article, by the way, is written by Christopher Hayes who is identified as having a wife at the White House Counsel’s office. I hope you have a steel stomach. This fight is going to get ugly.

SOURCE: The Nation

Our friend, Logan Clements, is still trying to raise the money to get his movie, Sick and Sicker, completed. The Indiana Star reports he was recently in Indianapolis talking to the state health underwriters’ chapter. He told the group, “Unlike welfare and other big-government programs, government medicine will not only hit us in the wallet, it will involve us putting our lives in the hands of government bureaucrats. That’s a very scary thought to me.” He is still trying to raise $200,000 to finish the film.

SOURCE: Indianapolis Star

The New York Times reports that some patients are putting off surgery due to the recession, while others are “rushing it” for the same reason. In either case, it must be bad. The article by Kevin Sack says, “Delaying elective procedures can have serious medical consequences, as when a detectable polyp develops into a tumor because a patient skips a colonoscopy.”

On the other hand, it also says, “The trends are far from universal, with some physicians and hospitals saying they have seen little change. Several doctors interviewed reported that some of their patients were deferring procedures while others were accelerating them.” It cites, “Val Arnold, 37, a skin cancer survivor who lives in Holly, Mich., said she chose to have reconstructive surgery on her nose on Feb. 13 because she had been laid off from her job with General Motors and would lose her employer-sponsored insurance on March 1. She would have preferred to wait, so that she would be immediately available if the automaker reactivated her job.”

The piece concludes, “Health experts predict that as the economy worsens, more insured people will begin deferring care because they cannot afford the high deductibles common in the insurance market.” You see, delaying surgery is bad when the patient makes the decision, but it is good when government rations care and everyone has to wait six months like they do in Canada.

SOURCE: New York Times