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Are poor Medicare recipients drug addicts, or are they selling their drugs on the street?  The stereotype out of the Government Acocunting Office says they are addicts defrauding the government.  Looking at the same study with an open mind, I think it’s just as easy to say they are trying to make ends meet by buying and selling drugs, just like most of the other residents of ghettos and barrios where the 99% live:

In 600 cases revealed in the audit, Medicare beneficiaries received prescriptions from as many as 87 different doctors in the same year indicating, the report said, that the patients shopped around to find as many providers as possible to write prescriptions for drugs in those 14 categories — mostly controlled substances and primarily hydrocodone and oxycodone.

“In these situations, there is heightened concern that these Medicare beneficiaries may be seeking several medical practitioners to support and disguise an addiction,” Kutz told the Senate Homeland Security and Governmental Affairs Subcommittee on Federal Financial Managment, Government Information, Federal Services and International Security on Tuesday.

The people who received multiple prescriptions accounted for $148 million in loss to Medicare, according to the Government Accounting Office, which conducted the audit. GAO believes that most of the “doctor shoppers,” who are disabled or elderly, are addicted to the drugs they’re buying.

I would like to challenge GAO: I would bet otherwise. I bet they are selling their excess drugs on the street to get money to live on. In this nation of haves and have-nots, Medicare is one of the last remaining sources of safety.

I looked this up on the internet. Here’s what Yahoo Answers says is the prevailing rate for oxycontin on the street: “usually the cardinal rule for all recreational pills is a buck a milligram.” In Palm Beach County Florida, where many elderly people live, recreational pain killers go for $8-$10 a pill.

Before we assume the Medicare beneficiaries themselves are the addicts, let’s look at who they are:

One barrier to spotting fraud among Medicare beneficiaries with low incomes is that they are a special group that can switch Medicare plans monthly, making it difficult to spot excessive prescriptions or excessive visits to the doctor, Kutz noted. Traditional Medicare beneficiaries can only switch Medicare plans once a year.

Doesn’t it make more sense that these people, who probably lack other necessities in life, have put their disabilities to work for them in the only way they can — to use them to procure drugs and re-sell them on the street. Of course looking at it that way would mean taking a systemic view of poverty, disability, social problems, and drug addiction. Prescription drug addiction is just as prevalent among the rich as among the poor, only the rich can afford to pay the $10 a pill.

Here at Health 2.0 there is definitely an air of transformation. Several initiatives that I had been following have come to fruition, or at least to critical mass, among them implementation of EMRs and patient communities. MedHelp now has over 12 million visitors a month, while millions of women annually visit the women’s social health site EmpowHER.com

On the electronic medical records side,  physicians have finally begun to implement EMRs in large numbers, because they are now subsidized by ARRA, the stimulus bill (you remember, the one that didn’t work?) to do so. In order to receive $50,000 to deploy an EMR, a physician need only buy one and demonstrate its “meaningful use” in his practice. For this year, to qualify for the Medicaid meaningful use incentive, all you had to do was purchase the software and go live in your practice. In the future, there will be other, more important qualifiers, such as the health outcomes of your patients. But for this year, just buy the product and begin to use it.

As a result, companies like Practice Fusion, which always made its software free, and is a (private) cloud-based platform have begun to grow by leaps and bounds. Founded in 2005, Practice Fusion grew by 400% in 2009 with the passage of ARRA now has 100,000 users and 21,000,000 patient records online. Next year, it is projected to have  100,000,000 records. Its iPhone app will launch soon, and its iPad app is being designed by one of the country’s top designers, who will speak at Practice Fusion’s user conference in November.

As part of an “exclusive” interview  with Practice Fusion’s founder and CEO, Ryan Howard, in which we took a pedicab ride around downtown San Francisco, I found out that within the next few years, users of EMRs like Practice Fusion will be able to choose physicians based on whether they have EMRs and allow the patient to have access to his or her data. After five years of waiting for the market to catch up with his innovation, Ryan has found himself sitting pretty, with open data ready for the new wave.

[ Aside: I also found out that in the early days of the company, Ryan actually took an insurance settlement check for an automobile accident and used it to make payroll instead of having his torn rotator cuff fixed. Yes, he's a hard core entrepreneur]

However, if you are a patient of the VA, of Medicare, or of any other insurer that is part of the Blue Button initiative, you can get your data today, by logging into VA.gov or Medicare.gov and registering online. Once you prove your identity, you will be given an opportunity to use the Blue Button  to download your data as a text file, or view it as a .pdf . You can save the data to your hard drive or send it to a PHR, such as Health Vault.

We appear to have “bent the curve” in health care spending last year; national health spending grew at a historically unprecedented low of  3.9%. That’s including all national health expenditures — private insurance, Medicare and Medicaid, and out-of-pocket expenses.

You would think this was a good thing, right?

But according to Deloitte’s new survey, not necessarily:

• In the United States, three in four (75 percent) consumers say the recent economic slowdown has impacted their health care spending.
• Forty-one percent are more cautious about spending, 20 percent have cut back on spending, and 13 percent say they have reduced their spending considerably.
• Sixty-three percent say their monthly health care spending limits their household’s ability to purchase other essentials, such as housing, groceries, fuel, and education.
• In an effort to save money, 36 percent of prescription medication users say they asked their doctor to prescribe a generic drug instead of a brand name drug.
• One in four (25 percent) U.S. consumers skipped seeing a doctor when sick or injured.

• Consumers believe that hospital costs (68%), lifestyle

choices (62%), and fraud (62%) are major drivers of

overall health care costs. Administrative costs (57%),

prescription drugs (54%), and defensive medicine

(51%) are also commonly cited.

• Over half (51%) of all consumers believe that 50% or

more of health care spending is wasted

• Of those believing that the system is wasteful,

49% feel that money is wasted because

individuals are not taking enough responsibility

for maintaining their own health.

• Consumers also blame redundant paperwork

(55%), defensive medicine (46%), lack of

adherence to evidence-based approaches (40%),

and extreme measures taken at the end of life to

extend life for a short period of time (35%)

Here’s an outline of what Paul Ryan wants to do to Medicare:

• Eligibility Age Increased from age 65 to age 69 1/2.
  Automatic payment reduction – If Medicare payments exceed prior fiscal years’ payments by 145%, providers automatically paid 1% less
  Medicare recipients age 55 and older may be covered by current traditional Medicare at Social Security Retirement Age.
  Younger than 55 not eligible for current traditional Medicare – They will receive a voucher for about $11,000 (adjusted for increased risk) which will be paid directly to the insurer they choose with the balance remaining, if any, to be paid to a Medical Savings Plan (MSA) for “additional health costs”. The voucher will be reduced based on income, so that beneficiaries with income between $80,000 and $200,000 (160,000-400,000 for couples) receive 50%, and beneficiaries with incomes over $200,000 ($400,000 for couples) receive 30%.
  Medical Savings Accounts – Tax-free account for Medicare recipients. Medicare and Medicaid recipients with income less than 100% of the FPL would be eligible for a MSA via Medicare to cover deductibles for the “average Medicare high-deductible health plan”. Those with income of 100-150% of the FPL receive 75% of the full amount.

For those of you reading this who are not on Medicare now, plan on signing over all your assets to insurance companies, hospitals and providers if Ryan’s plan becomes reality. You get a fixed amount to go buy insurance. There are no cost controls. There are no incentives for health insurers to keep costs down. There is only a flat amount that the government will use to “help” you.

If you’re under 55 and become disabled? Voucher.

If you’re the parent of a disabled child? Voucher.

Don’t be fooled by the rationing argument these idiots are trying to use. Rationing happens now, today. This minute. Outcomes-based medicine is not rationing. It’s using funds wisely.

A tax increase would end this debate entirely. An end to the wars would end this debate entirely.

Changing the entire nature of Medicare to a subsidized private insurance system would end our lives. Do not be fooled by Rep. Ryan’s snow job. This is a man whose family depended on Medicare and Social Security in order to get through college so he could argue for taking yours away.

In other contexts, we call that sociopathic behavior.

Those of us who follow both innovation and politics know that most of the budget is not discretionary. The “untouchables” include Medicare, Social Security, and Defense. The “discretionary” includes everything necessary to win the future: education, clean energy, new infrastructure, and high speed transportation.

The President believes we should innovate in those areas. And there is already much innovation happening there. I’ve just read 104 proposals in response to the Arizona Commerce Authority’s Innovation Challenge. They ranged from optics to aerospace, from materials science to education software, from pharmaceutical research to solar energy.

And that’s just in one state. Imagine what’s going on elsewhere.

Of course we should fund that innovation. Much of it is already funded by SBIR grants, the best and nearly sole way of getting technology out of the lab and into a business. SBIR grants can be expanded, perhaps made more inclusive, to fund transportation, innovative infrastructure, and smarter power grids.

But where do we really need innovation? In the  areas of the “untouchables.” Where is the proposal to find a new way to house or feed the elderly that costs less than what we spend now? Where are the innovative end-of-life treatment proposals?

Where are the new ways to deliver healthcare? Why are transformative ways to deliver primary care and run medical offices having so much trouble getting off the ground? Where is the innovation in the insurance industry?

These proposals are out there as well. New forms of communal living and remote monitoring can drive down costs for the sick and the elderly. New negotiation and defense strategies can help cut the defense budget. (In all fairness, the military  has done better at re-tooling for the future than almost any other sector, since DARPA was founded during the signature Sputnik moment of the last generation.)

I am in favor of cutting the expenses of the old (not people, but methodologies), to allow research in the new. Perhaps the next innovation challenge should be for technology to solve social problems. After all, a society that can support its citizens in a healthy, productive manner throughout their lives will win every war, simply by outliving the enemy.

The prize we as an country keep our eyes on should be innovation in how we live as a nation. When we were founded, we we were innovative. How? In the way we governed ourselves. How about some innovation there as well.

Perfect example of kicking the can down the road: the Senate prevented a cut in Medicare payments for doctors during the month of December, so they could kick it down the road to the new Congress without freaking out seniors. They still haven’t figured out they could fix it permanently, and are only going for a one year fix next time, too. How would you like to run a doctor’s office under these conditions?

I ran a medical office for my husband in 1996.  Even then it was a constant battle to figure out what we could afford during constantly changing reimbursements. It was so complicated: what health plans were “worth” participating in, because they all reimbursed differently, in different time periods? What was the right combination of Medicare and private patients? How did you achieve that combination without turning people away who needed diagnosis (my husband was a radiologist)?  My husband’s office lost money every month.

And how do you staff for this constant change?

At that time, it was the private health plans that called the shots and the government that was the payer you fell back on. Now, the source of uncertainty is more and more about the government as it mangles the legislative process on one end, and then subjects providers to Recovery Audit Contractors on the other end. As of this year, not only will every region be audited for overpayments, waste, and abuse of Medicare funds, every state will also have to look at abuse, waste and fraud in Medicaid funds. And if there’s a mistake, the provider will have to dispute the claim or give the money back to the government.

More paperwork. More staff. More records management and claims management. Mor uncertainty Less treatment.

I usually write from the patient perspective, but today I’m reaching back in time for my provider hat, which is not so different from my entrepreneur hat.

You can’t run a small business with employees if you don’t know what the government will do from one day to the next and if you have to give back money you have already collected and probably used. If you have to pay claims specialists, coding specialists, IT specialists, medical records specialists, you can’t pay doctors or even nurse practitioners.

Everyone points to job growth in health care as an opportunity to get us out of the recession. And yet we all know nurses who have been laid off, and doctors who are leaving practice.  Why? Because health care job opportunities aren’t really in providing care; they are in providing support for audits and management of budgets.

Once again I am amazed at how money is misspent in health care, even though mucho technology is out there to cut costs.

Arizona Health-e Connections Summit is a conference/trade show for people interested in linking disparate bits of data into meaningful information for both payers and providers (never mind the patient–she comes last).

Roaming around the trade show floor,  I saw two great examples of health IT misadventures:

In an era where almost everything has an API, a company called Certify Data Systems is selling a literal “black box” to create a “secure handshake” between Cerner’s data, which is in use by enterprise health systems and hospitals, and the  simpler products used by physician practices.  But in the era of OAuth and Facebook Connect, why do we need a black box to bring data from one software application to another? Don’t answer; that was a rhetorical question.

Second example: Intel is demonstrating a device similar to a tablet with a kiosk-like touch screen, meant for the home night stand of the chronically ill.  The device can transmit data from peak flow, blood sugar, or blood pressure monitors back to a doctor’s office, initiate a call to a nurse through a simple command button (Call My Doctor), or a prescription refill through another button (I Have Run Out of Medicine.) This is the opposite of the black box in its user experience.

But it costs about $100 a month to lease, and as a patient you can’t have it unless both your payer and your provider agree, because they are in charge of your records. And who will pay for this if you can’t afford it? Unless it becomes part of the attempt to control costs put forth by the new legislation, it will never get into the market.

On the other hand, it just might, because buried in the bill we all love to hate is a provision that if a doctor admits a patient to the hospital and that patient gets discharged and re-admitted within 30 days, the hospital and the doctor both won’t get paid. So there will be an incentive to monitor those chronically ill patients at home. In addition, the speaker from CMS said that Medicaid and Medicare were looking for expanded definitions of “meaningful use” for health information technology products, and to that end were examining the medical home concept and other drivers of quality and value (effectiveness) rather than mere quantity of services.

Wouldn’t that be cool? I’d love to have the convenience of remote monitoring as a patient, and my absence from my doctor’s office for routine matters of chronic illness (blood pressure monitoring) would free him up to see other, more interesting  patients.

There has been precious little civil discourse around the reent health care legislation, but Victor Trastek, MD, CEO of Mayo Clinic Arizona,  made a distinguished contribution to it when he spoke to the Harvard Business School Club in Phoenix today.

Of course he was speaking to educated people, but it was heartening to hear him say that everyone in the health care equation is going to have to do his/her part to make the new legislation a success, especially physicians, who will have to step up and learn how to collaborate around scarce resources to produce greater value, and patients, who will have to think about behavioral changes. Although some of the guests asked tough (politicized) questions, he refused to diss the new legislation, despite his admission that there’s a 20% cut in Medicare payments to physicians still “hanging out there” while Congress is on recess and that “rationing is what happens if we fail to get everything else right.”

It was all the more heartening because Mayo Clinic is a leading national health care institution, known for its high quality and ability to treat difficult cases.  It is also a leading employer in Arizona.  It contributes $1.45 billion to the Arizona economy, and its facility has 425 physicians and a staff of 4400, dedicated to the three connected areas of medical practice, patient and medical education, and research.

But Arizona, it turns out, makes up only about 10% of Mayo’s revenues. Mayo Clinic the the largest nonprofit health care system in the country, with a multi-specialty integrated model of care for mostly sicker people. Although it does some primary care, most of its physicians are specialists. And its Arizona CEO is a former thoracic surgeon, not a business guy.

Dr. Trastek said the new legislation tries to answer the question that’s troubling everybody: “How do we give good affordable health care?”

Somewhat surprisingly, he went on to say that although payment is a big part of health care, and payment was the biggest thing addressed by the legislation, the biggest responsibility for the new program’s success falls on the patient.

And then he reminded everyone in the room that presidents since Harry Truman had been trying to increase access to health care for Americans. In fact, I learned that the first Medicare card, signed by Lyndon Johnson, went to Harry Truman!

Then came the presentation of reality: Medicare goes to everybody whether they need it or not, and that may have to change. This is called “means testing,” and no one wants to acknowledge that people with more money might have to pay something for Medicare in the future. Especially if the elderly want physicians to keep taking Medicare patients.

One of the funniest parts of the  presentation was a slide Trastek showed of the actual formula Medicare uses to pay physicians. It is such a complex equation that it ran off the right side of the slide, and Dr. Trastek said that wasn’t even the entire formula! That was a very good visual to show the complexity of the program, and why some people feel it’s unmanageable. Dr. Trastek also told us that Congress went home for Easter without deciding whether to cut physician payments or not (presumably Congress doesn’t want to cut payments and lose physician participants, but doesn’t know how find the money to do the pay-go thing), so Medicare has just stopped paying its bills altogether. Imagine trying to run a physician practice caught between the banks who aren’t lending to businesses and Medicare, which is no longer paying timely. Must be a CFO’s nightmare.

In addition, health care inflation is up 30% in last decade , while payments to physicians went down 5%. So it’s no surprise that physicians try to do more. That’s now they make money.

The current method of funding health care has been through a cost shift from the old to the young. But their are too many of us old people, and not enough young.  And many of the young are unemployed.  Or can’t pay the high premiums. One of the biggest parts of the legislation intends to fix all this.

Mayo has its own plan to address these conditions. It is aiming to create value, coordinate care, reform the payment system,  and thus insure everyone. As a result, it pushed hard to have the payment system shifted to value, or outcomes. As a system, it already measures outcomes, has cut costs, and aims for zero defects. Trastek feels it is the physician’s job to help  patients get the best care under the new law.

And speaking of the law: Dr. Trastek admitted that will take months for Mayo to figure out everything that’s in it.  Bottom line, it will cover 30 million more people, of whom 14 million will be on Medicaid, which states will have to find a way to pay for. That’s why fifteen governors are suing to opt out. But opting out doesn’t seem like Mayo’s answer to the problem: Mayo says we have to deal with utilization or we will never fix the system, because utilization will double and triple without control. Dr. Trastek pointed out that Medicare patients now have the right to see a specialist every day if they want to, and in most cases it’s free. And the specialists (he didn’t say this) don’t try to control utilization, because Medicare doesn’t reimburse them enough and they thus have to “make it up in volume.”

The best parts of the program, I think Trastek believes, are pilot programs to pay for value, and the move of the industry to technology (robotic surgery, tele-stroke programs where doctors are virtually present in rural emergency rooms, and electronic medical records). The messiest parts are mandating that well people buy insurance, fixing the primary care doc shortage, getting rid of skyrocketing debt for medical education, and taking care of payment systems that encourage physicians to drop Medicare patients. Some of the innovative things Mayo does include teaching medical students “delivery skills” such as law and journalism, to improve their communication with patients; training through simulation and collaboration; and

After presenting this factual and complicated picture, Trastek came back to what we can do. Again he pointed out that everybody has to do something — physicians can’t sit back this time and not change their practice methods, and patients can’t continue the American lifestyle of “I will do anything I want, and if I break you will fix me so I can go back out and do it again.”  He believes that in the future, patients will be financially incentivized to take better care of themselves, and health systems will have to learn to work together.   And if not, there WILL be rationing. Health care can’t be free.

Standing on a line at the post office yesterday,I overheard two elderly people  having a conversation about the significance of reduced hours at the post office. One remarked that it was an inconvenience and meant the country was going to the dogs.  The other said snidely, “wait until we have Obamacare; we will be a third world country.”

They seemed to feel that any effort to alter the health insurance strategy of the country would negatively affect them — and perhaps it would. The cuts would come out of Medicare Advantage, and from savings of waste and fraud. I don’t belong to Medicare Advantage, because I know it’s a drain on the system and a boon to insurers.  Seniors might lose dental, vision, and preventive care if the reforms pass. I choose to pay for those myself, because they are a minor part of the health care services I use. But perhaps some seniors can’t afford to pay out of pocket at all. Those people still receive baseline services.

So I think it’s about time seniors, who vote in large numbers, stop thinking about themselves and start thinking about what would be left for their children and grandchildren. We don’t just pull up the draw bridge when we have our own piece of the pie. If we do, we’re not a civilized society; we’re not even an aboriginal tribe. Even tribes take care of their own members.

I have two children, a grandchild, and four foster children. My own children have health care, one through her employer. She never uses it because she’s healthy and never meets the deductible. My other child is self-employed, and uses her insurance as little as possible, because she has a very high co-pay. Neither one of them has or uses preventive care benefits, or dental and vision.

My former foster children are now all adult wage-earners, but they’re not as fortunate. None of them have health benefits through an employer. One has a catastrophic policy through his wife’s employer, but with $1000 co-pay neither of them can afford to use the insurance. Another can’t afford her share of the premiums for the policy offered by Starbucks.. One is on Medicaid because her job is part-time and she has no children. Another has been told recently that his company is no longer hiring full time and that he will be kept on as a “temporary” employee — presumably so his company won’t have to pay benefits.

These people are the future. They have no vision, no dental, and no preventive care. And they will be alive much longer than I will.

It’s pretty amusing to me to watch seniors who should have been concerned about preventive care thirty years ago grumble about potentially losing those wellness benefits when they (we) are already at a time in our lives when almost nothing can be prevented. Moreover, seniors stand to gain prescription drug benefits (the closing of the donut hole), which are far more financially significant than a gym membership; a Silver Sneakers program will not turn the tide for us. And yet we are willing to be selfish enough to hang on to every benefit we possibly can, at the expense of those coming after us.

In my own case, I’m happy to share my taxes, my benefits, whatever I have with my children and their children.

I’ve been trying to understand why as a nation, we are so divided about health care reform. You would think every American would be generous enough to think the guy next door deserved decent health care. You would also think we would be embarrassed to have our issues aired in front of all the other developed countries, like our neighbor Canada, who extend protection to their own citizens. (Never mind those socialists in Europe). I mean, the single SuperPower, the country I grew up in, is expected to set a standard for the rest of the world to follow. But in the past year, we have set a standard only for uncivil debate, distortions, lies, half-true talking points, and backroom deals.

Health care reform has ceased to be about health care or reform. Instead, it is now about money, like everything else in the country. That monolith I hear about on C-SPAN every day “the American people,” has taken a collective haircut in wealth over the past few years. No longer to we feel like the richest, most powerful nation in the world. In fact, we feel like China is eating our lunch, the planet is warming or cooling, the Islamic fascists are out to get us, and our children may not even be getting a good education. We feel poor.

No wonder we have retreated into our shells, a nation of turtles. Recent events have scared the pants off us.  Especially events involving money.

We’ve spent the past eighteen months desperately de-leveraging, denying ourselves things we used to take for granted, and trying to climb out of debt. We are in no frame of mind to authorize spending on a single extra family-sized pizza, much less on an “entitlement program” that might raise the deficit, a concept we never discussed in the passed.

How many of us even know the difference between the national debt and the deficit? There is one, you know.

The deficit is the difference between the money Government takes in, called receipts, and what the Government spends, called outlays, each year. Receipts include the money the Government takes in from income, excise and social insurance taxes as well as fees and other income. Outlays include all Federal spending including social security and Medicare benefits along with all other spending ranging from medical research to interest payments on the debt. When there is a deficit, Treasury must borrow the money needed for the government to pay its bills.

The national debt goes up and down, depending on what’s happening in the country. For the last couple of years, because of the downturn, tax receipts have gone down, so the deficits have gone up.  Those accumulated deficits make up the national debt.

When well-run businesses run into a downturn, what do they do?  They don’t just stop taking risk. Often they use the time to invest in the future. The next time the economy turns around, they are well-positioned to grab a leadership position. Not that there’s anything wrong with paying down debt, but  you can’t downsize your way to success. You have to raise revenues.  You have to sell. You have to grow.

If we keep our population healthy and educated, then when the turnaround comes, we can quickly pay off our debt, because the deficits from income tax receipts will go away. We can grow. That will raise revenues.

Not passing health care reform is the flip side of fighting wars on two or three different middle Easts fronts at a time. It’s what we do out of fear. It’s not what we do out of strategy, or leadership, or even our Christian underpinnings.