To say we have a “health care system” is laughable; we actually have is a disconnected bunch of stakeholders who all view health care and the financing thereof through their own distinct lens.  There’s a:

• heavy emphasis on profit and personal/corporate gain from individuals and organizations ‘serving’ the health care needs of Americans,
• all subject to direction and oversight by an increasingly overburdened regulatory infrastructure that in turn is
• directed by legislators who are often beholden to those
• folks making a living off the “system”.

Any wonder it’s completely screwed up?

Yet we often lose track of these central challenges when thinking about/developing solutions to problems in health care delivery and financing.  Quoting Chris Brigham, M.D, “Many of the challenges we face in workers’ compensation are the results of flawed processes and wrong incentives – that drive certain behaviors – ultimately harming injured workers and society”.

There are a couple resources that help bring things back into focus.

First is the film, Escape Fire: The Fight to Rescue American Healthcare”  www.escapefiremovie.com This is a terrific documentary of a medical industry – not system – with profit-driven, rather than patient-driven care.  It has played on CNN several times during the past month and is available on ITunes and as a DVD.   Our health care costs are approaching 20% of our gross domestic product. We spend $300 billion on pharmaceutical drugs – almost as much as the rest of the world combined. 65% of Americans are overweight and 75% of healthcare costs are spent on preventable diseases that are the major causes of disability and death in our society. It is inexcusable. 

The second is an insightful article “Chronic Pain: Fundamental Scientific Considerations, Specifically for Legal Claims” by Robert J. Barth, PhD which was the lead article in the January / February 2013 issue of the AMA Guides Newsletter.  Barth’s article is an in-depth discussion of evidence and scientific findings indicating eligibility for compensation is the domi­nant factor for chronic pain claims.

With chronic pain the reef on which the ship of workers comp is increasingly likely to founder, Barth’s piece is well worth the read.  The key sentence – Barth quoting from a speech given by the author of a study on back pain – is this:

“Minor trauma was only associated with serious low back pain in a compensation setting.” [emphasis added]

Barth – “None of the surveyed participants who were NOT eligible for compensation developed serious low back pain after minor trauma.”

And there you have it: unequivocal evidence that there’s a huge amount of “secondary gain” driven medical care.

What does this mean for you?

Anyone who thinks there are simple answers to our health care mess is a simpleton. 

No this is not an April Fools prank. Aetna announcedtoday it will acquire Coventry Healthcare. The transaction is is in cash and stock and is valued at $7.3 billion after accounting for aetna’s assumption of Coventry’s debt.
The deal will give considerable strength in a number of key secondary and tertiary markets particularly in the central Midwest. It also makes Aetna a major power in Part D, strengthens the company’s Medicaid position, and puts Aetna back into the workers comp business.
This last is rather interesting. While Coventry’s workers comp revenues have been pretty much flat for five quarters, it is a big cash generator. However Aerna recently shut down its workers comp business (consisting of a network marketed exclusively thru Coventry) and management of that unit was not interested in the sector.
I’d be surprised if Aetna doesn’t keep their new work comp unit operating; cash is precious as they prepare for a post-2014 world and David Young’s unit has shown itself very good at generating lots and lots of green.
It is quite clear many other operating and administrative operations will see layoffs. Aetna expects $400 million in synergies ie lower costs – and most of that will be in the form of staff reductions.
From the official press release…
Adds growing individual Medicare Advantage business
Substantially increases Medicaid footprint
Improves Aetna’s positioning and reach in Commercial businesses
Adds low-cost product set built on value-based provider networks
Expected to be modestly accretive to Operating EPS in 2013, $0.45 accretive in 2014 and $0.90 accretive in 2015, excluding transaction and integration costs

Steven Colbert’s one of the funnier people/newscasters out there – and his piece on “Debt Panels” [opens video] is terrific.
Colbert helps us understand the role of finance in the emergency medicine department, a role that has grown significantly over the last couple years along with the rise of the number of uninsureds…
Hat tip to Care and Cost for the head’s up.

MRIs used to cost thousands; but today, you can get one for a mere $75 – if you use Groupxx’s coupon (no, I won’t provide a link, that would encourage this behavior).
Today’s virtual in-basket had not one but two notes from colleagues about this fantastic offer, one where you can get an MRI AND a medical consultation, which normally goes for $250, for the tiny sum of $75.
For that, you get “the chance for one of those moments of clarity. We provide you with the opportunity to appreciate and better understand the inner intricacies of parts of your body such as your spine, your joints or your pelvis through an MRI scan.”
Wow, such a deal.
Of course, something could easily appear on that MRI which would lead to more treatment, more bills, and more revenue for the MRI’s owners and the docs doing the “diagnosing”.
Now, I don’t think this is all bad.
Insurers may use these ads as a way to get even lower rates from MRI vendors.
Claims adjusters may want to buy a couple dozen to sock away for that next rash of lower back injuries.
Self-insured employers may even now be getting out their credit cards to reserve a few slots for employees and dependents with undiagnosed musculoskeletal issues.
Isn’t the free market great?
Thanks to Gary Schwitzer and the unnamed colleague for the heads’ up…