Rounds Online

Well, the President is planning a summit with Republican and Democratic legislators to see if something can be done to salvage healthcare reform. And the legislative reform he is trying to salvage is a peach.  Although the House and Senate bills have not yet been reconciled, it is certain that the landscape of health insurance would change under either version.  But, at the end of the day, we are not really talking about healthcare reform but rather health insurance reform.

The practice of medicine is not likely to change one iota as a result of this legislation.  Not one structural change to the delivery of health services has made it into either bill.  And as with all sweeping social legislation, once the ink drys on a presidential signature, undoing what has been done is an absolute impossibility (see social security, Medicare or Medicaid).  Lets consider what has and has not been accomplished.

The stated goal of the process when it first began was to provide for universal health coverage, affordable health coverage and health coverage that would cost the American taxpayer not one penny more.  Admirable goals.  What a pity that none of the above was achieved.

I’ll have a good deal more to say about this subject in the coming days and weeks.  But for now there are several things to bring to the attention of our elected representatives as they prepare to sit with the president and break bread (and the national treasury).

This legislative train wreck is supposed to be revenue neutral as it relates to the national debt.  Yet adding 41 million new souls to the roles of the insured, many of whom could not afford coverage at any price is going to cost a bundle…a bundle in the neighborhood of a trillion dollars.  Now there are only two ways to cover increased costs…cut expenses elsewhere or raise taxes.

Our politicians have just realized that Medicare has some 300 billion dollars of waste that can be cut.  Now that is interesting.  Considering Medicare was established in 1966 and is now over 33 years old, I wonder why it took so long to realize that there is that much waste and fraud in a government run healthcare program.  And it is even more puzzling why that waste and fraud has not been eliminated before now.  And, for that matter, I thought that government was much more capable of managing healthcare than the private sector.  After all, if the Democrats had their way we would be moving toward a single payer system managed by…you guessed it…the federal government.

Question:  Does anyone really believe that our spineless windbags in Congress are going to cut anything out of Medicare?  Get your head out of the sand (or where ever else you have stuck it) and get real.  It’s a case of the Emperor’s new cloths…someone needs to shout “they ain’t going to do it.”  So that leaves taxes.  And guess who is going to get taxed?  Well, I have some very bad news for you.  It isn’t going to be the rich.  They have very competent legal representation.  They will do just fine.  The politicians will begin moving down the food chain very quickly once the deficit really starts to sore.

For brevity’s sake I am going to stop here and catch my breath.  I’ll leave for another day issues like the absence of tort reform, the absence of any answer to the growing cost of medical education, the critical shortage of primary care physicians, the absence of any incentive for personal responsibility, the absence of any reason why the cost of insurance isn’t going to go up even faster than before and an explanation of how doctors and hospitals are supposed to stay in business when we keep reducing reimbursement and mandating new coverage.

It will be interesting to watch all the players posturing before the camaras. An interesting prop would be to give each a fiddle.

As a very important source of strength and security, cherish public credit. One method of preserving it is, to use it as sparingly as possible; avoiding occasions of expense by cultivating peace, but remembering also that timely disbursements to prepare for danger frequently prevent much greater disbursements to repel it; avoiding likewise the accumulation of debt, not only by shunning occasions of expense, but by vigorous exertions in time of peace to discharge the debts, which unavoidable wars may have occasioned, not ungenerously throwing upon posterity the burthen, which we ourselves ought to bear.  -  GEORGE WASHINGTON, Farewell Address, Sep. 17, 1796

Posted by guest author: Jeff Krug, President, J. Krug and Associates, MD Preferred Financial Advisor

Every year between 600,000 to 1,000,000 health care workers experience needlestick injuries in the United States; this does not account for the injuries that go unreported. Most needlestick injuries involve nursing staff but laboratory staff, physicians, housekeepers, and other health care workers are affected as well.

Needlestick injuries occur whenever a healthcare worker is exposed to a needle or other sharp device. Needlestick injuries depend on the type of design and the devices used and are typically related to certain work practices such as recapping, transferring a body fluid between containers, and failing to properly dispose of used needles in puncture-resistant sharps containers. These needlestick injuries expose healthcare workers to serious diseases and infections and can result in millions of dollars of expenses for the medical facility or hospital for both the physical and the emotional injuries. According to the American Hospital Association, one case of a serious infection by bloodborne pathogens can result in $1 million of employers costs related to testing, follow-up, lost time, and disability payments. The cost of a high-risk exposure is almost $3,000 per injury even when no infection occurs.

In order to address the issue and reduce the number of injuries that healthcare workers receive from needles and other sharp medical objects, OSHA created the bloodborne pathogens standard which has been in effect since 1992. This standard applies to all occupational exposures to blood or other potentially infectious materials. Some requirements include the following:

• A written exposure control plan designed to eliminate or minimize worker exposure to bloodborne pathogens
• Compliance with universal precautions (an infection control principle that treats all human blood and other potentially infectious materials as infectious)
• Engineering controls and work practices to eliminate or minimize worker exposure
• Personal protective equipment (if engineering controls and work practices do not eliminate occupational exposures)
• Prohibition of bending, recapping, or removing contaminated needles and other sharps unless such an act is required by a specific procedure or has no feasible alternative
• Prohibition of shearing or breaking contaminated needles (OSHA defines contaminated as the presence or the reasonably anticipated presence of blood or other potentially infectious materials on an item or surface)
• Free hepatitis B vaccinations offered to workers with occupational exposure to bloodborne pathogens
• Worker training in appropriate engineering controls and work practices
• Post-exposure evaluation and follow-up, including post-exposure prophylaxis when appropriate
Needlestick injuries are an important and continuing cause of exposure to serious and fatal diseases among health care workers. Greater collaborative efforts by all stakeholders are needed to prevent needlestick injuries and the tragic consequences that can result. While prevention is important it is also important to make sure that your organization is covered for the injuries that do occur. Talk with you insurance provider to make sure that your worker’s compensation program covers the costs associated with needlestick and other sharps injuries to combat the expenses your organization incurs with the associated injuries.

* The information in this article was provided by the National Institute for Occupational Safety and Health (www.cdc.gov/niosh). If you have any questions about your coverage please contact J. Krug representative.

As the President and founder of J. Krug & Associates, Jeff has used his industry expertise in creating and maintaining unsurpassed insurance and risk management programs for all of his firm’s clients. His desire has built J. Krug & Associates into a dynamic organization that has set new standards of service excellence within the insurance industry. Phone: 847-818-7502 Email: jkrug@jkrug.com

As the debate rages on over healthcare reform, it’s always interesting to look for the issues that are not being addressed. Congressmen and women and senators of both parties have strong opinions on the wisdom of a publicly funded insurance option. There are even those that support a one-payer system similar to those in countries such as France, Denmark and our neighbor to the north, Canada.

Looking at the system in place in Denmark, one is struck by the apparent success of the single payer system in controlling costs. Denmark has better outcome statistics, lower infant mortality rates and longer life spans while spending considerably less of its countries wealth on healthcare.

What seems to be lost in the comparisons is the significant role that the tort system plays in the apparent success of the program. As public employees, physicians and hospital staff are immune from law suits for malpractice. Physicians do not need to carry malpractice insurance. The savings to the system are significant.

If the democrats are successful in pushing through a healthcare reform package that includes a public option, which at this date seems increasingly less likely, does that mean that doctors and hospitals accepting patients with publicly funded insurance would be immune from law suits?  Would tort reform actually become a be a by-product of Democratic legislation?

To listen to the democrats, such thoughts are heresy. They are as beholding to the legal lobby as the Republicans are to the medical lobby. But can any serious attempt to control the rising costs of healthcare not include some reform to the current tort system? It’s an issue that is being studiously ignored.

When you were a kid do you remember the fun you had filling balloons with water and tossing them at each other? The bigger the balloon the harder it was to handle. If you pushed on one part of the balloon, it bulged in another. Healthcare reform is beginning to behave like an over-filled water balloon.

The Congressional Budget Office estimates that the Senate Finance Committee’s healthcare bill as written would result in a surplus of $81 billion over the next ten years. So, does this mean that we are finally getting control over rising healthcare costs? Hardly…

A key element of reform is the mandate that all individuals – legal US residents – must obtain health insurance. And of course, for those who have none now, that means that they will have to pay to play. Of course if you are an illegal resident of this fine country, you can continue to show up at the emergency room without penalty and without insurance…guess who gets to pay?

And of course with the mandate that all must participate comes the pledge to help those who cannot afford the price of admission. The tab for tax credits and subsidies…somewhere north of $510 billion over ten years. Let’s see, we push on the balloon to the tune of $81 billion in surplus and we bulge with $510 billion subsidies.

It costs about ten times more to get insurance today if you are old than if you are young. The new bill will reduce that ratio to 4:1. Great if you are old and ill…not so great if you are young and healthy. You can bet the insurance companies aren’t going to eat the increased cost of insuring the elderly. Any bets where they will transfer the costs? The government pushes the balloon and it bulges elsewhere.

And if you are a business that provides health insurance for your employees, or if you are an insurance company that offers insurance, or a pharmaceutical company that sells medicine, or if you are a clinical laboratory you are going to be taxed and taxed heavily (somewhere north of $9 billion dollars). They will of course pass the cost on to the consumer.

So, if you were expecting healthcare reform to reduce the size of the balloon, forget it. States will pay more for Medicaid and will raise taxes. Business will pay more taxes and will raise prices. The uninsured will pay to become insured and the subsidies to make that palatable will be covered by the young and the healthy. The more things change the more they stay the same. Bottom line, this is not cost control legislation. This is a good old fashioned political program designed to redistribute wealth.

When Senator’s Charles Grassley and Orin Hatch, both Republicans, asked that CBO Director Douglas Elmendorf be present when the Senate voted on their version of healthcare reform, they were trying to send a signal to the American public that Senators are seriously attempting to understand how legislation will affect the lives of their constituents.” They understand all right. And so do we. This isn’t the first water balloon we have had dropped on our heads.

By: Ivan Hoffman, CFP®, Valeo Financial Advisors

At last, all of your medical training is about to pay off. Perhaps the 16 hour work days won’t go away completely, but at least your pay check will reflect compensation received for services rendered.  No more fresh student loans to sign, no more embarrassing residency stipends that pale beside the pay checks of your friends with a bachelor’s degree.  Your gross monthly income now approaches your annual resident’s salary, and should pave the way to prosperity.  You must now focus on patient care, track to partnership, Medicare and Medicaid paperwork, continuing medical education, and clinical excellence.  Your financial life is about to become much less complicated and far less demanding of your time and attention.  Buying a house, replacing that high-mileage vehicle and paying down a mountain of student loan debt can be managed when the time permits.  Right?

Wrong!

Our experience suggests otherwise. Although, clinical and business issues are critical to developing your career as a physician, you cannot expect your new found revenue stream to take care of your other financial obligations without your attention. It is more important now than ever to establish a strong financial foundation. This is the period in your life to begin taking a proactive stance to solidifying important financial decisions. Fortunately (and unfortunately) for you, there are numerous financial professionals ready and willing to serve. These financial professionals will come in all shapes and sizes. You have probably already met a few of them, but you should be prepared to begin receiving calls, emails and mailings from various types of insurance agents, mortgage brokers, private bankers, financial advisors, stock brokers, realtors, malpractice attorneys and accountants, to name a few.

School is out, but your homework is far from being done. Find out who these people are and ask the hard questions:

1. What is your company known for?

2. What are your credentials?

3. Have you or your firm ever been disciplined for unethical actions?

4. How much will this cost me?

5. What is your incentive? How do you get paid?

6. How often will we talk?

7. Will I talk with you or someone else?

8. Will you provide references?

9. Can you show me an example of an engagement letter / agreement?

Be keenly aware of conflicts of interest. Don’t be the next physician preyed upon by salespeople looking out for their interests instead of yours. Surround yourself with people whose business model centers upon objectivity.  Begin to build a team of trusted advisors. You have earned the right to financial prosperity. Take it upon yourself to be ready for it.

Ivan Hoffman, CFP® is a financial planner at Valeo Financial Advisors, a fee-only financial planning firm servicing clients throughout the U.S. Ivan is also a NAPFA-Registered Financial Advisor (National Association of Personal Financial Advisors), as well as a member of the MD Preferred Financial Advisor Network. He can be reached at 888-488-2536 or idhoffman@valeofinancial.com.

A young professional prepares to buy her first home and presents her mortgage application to the bank. She clearly qualifies for the loan but there is a problem. Her credit report shows over $9,000 in unpaid medical bills! The problem is that they are not her bills. This scenario is playing out more and more frequently as medical identity theft becomes a growing problem.

The FTC estimates that imposters using forged or stolen identity documents to secure medical care account for as much as 3% of identity theft in the U.S. – nearly 250,000 cases each year. And of course this problem affects all the victims of the crime including the doctors, hospitals, insurance companies and the individual.

The FTC has taken action to address the problem. And the impact on doctors can be substantial. A new regulation called the “Red Flags Rule” took effect this past August. Within the medical community, the new rule will require doctor’s offices and hospitals to establish protocols to identify the “red flags” of identity theft. Not only must doctors implement procedures, such as checking photo ID’s, checking for medical record inconsistencies and monitoring fraud alerts from consumer agencies, but they must also detail what they will do if they spot a potential problem.

This unfunded mandate requires “creditors” to implement these new protocols. In the language of the statute creditors are defined as businesses that regularly extend or renew credit. This would include any physician’s office or hospital that accepts insurance or offers a payment plan for services rendered. The AMA and numerous doctors groups argue that grouping physicians with auto dealers and utility companies are misguided and that doctors are not “creditors.”

Despite these protests, doctors can add another layer of paper work to an already overburdened process. As the healthcare debate moves forward, it becomes increasingly difficult to understand how the government can get its arms around a complex problem that hundreds of government agencies make more complex by the day.

Ever been to South Bend Indiana? Lovely Midwest town… Notre Dame University…the Studebaker National Museum. In the summer when the college kids go home, there are no lines at the local Jewel food store or at the downtown stop lights for that matter.

I have a swell idea. Why don’t we turn the healthcare debate over to the citizens of South Bend. Whatever they decide will be binding on the 308,487,535 US citizens who don’t call South Bend their home. Think of how much more streamlined the process would be. There probably aren’t more than a couple of dozen lobbyists who live there. No filibusters, no parliamentary maneuvering, no party lines…just a simple up or down vote. If the yeas have it we get healthcare reform but without all the pork. If the Nays have it we go on with our current system, warts and all.

Absurd you say. Nonsense, undemocratic, heresy! The thought of letting 109,425 citizens decide for the rest of us is simply ludicrous. Well, if the entire population of South Bend actually voted (work with me here) they would equal the total margin of victory that Scott Brown enjoyed in the Massachusetts Senate race that rocked the political world. And the election of a Republican Senator from Massachusetts gives the Grand Old Party the 41st vote they need to block any healthcare reform changes coming out of the conference committee charged with the task of reconciling the Senate and House bills.

That means that if even one sentence, one word, one punctuation mark is changed, the Democrats would need 60 votes again in the Senate. And Republicans are daring them to try it. So, it looks like just shy of 110,000 folks in a smallish East Coast state are going to determine the future of healthcare reform in America. Our democracy is becoming as fragile as a china tea cup (no reference to the Tea Party Coalition intended).

While democracy in the long run is the most stable form of government, in the short run, it is among the most fragile.
Madeleine Albright