A short history of Dialysis Availability

[chickenhead]

With all the talk of "death panels", and fear about the government being involved, a history of dialysis in this country might be useful for some perspective.

http://www.washington.edu/research/pathbreakers/1960c.html

The early units weighed about half a ton; they were bulky and could only treat one patient at a time. Babb and colleagues engineered a new system called the "monster" for simultaneous, multi-patient dialysis, in order to increase the number of patients at the UW Hospital and reduce treatment costs. Recalls Scribner: "We were going along pretty well with our four patients at the University and it became patently obvious that if it was ever going to amount to anything, we had to get it out of the ivory tower and out into the community. I was able to convince the Hartford Foundation to give us a grant to demonstrate community feasibility, and we built the little center down in the basement of the nurses' residence next to Swedish Hospital to demonstrate out-of-hospital or so-called outpatient dialysis."

That only a few patients could be treated, and even then at great cost, raised a serious ethical dilemma which in turn set in motion a transformation of the health care system in this country.

First of all, the demand greatly exceeded the capacity to treat patients. And since the treatment cost about $10,000 annually, some means of deciding who would be treated was needed. An anonymous panel of community members was charged with screening applicants and selecting patients for treatment. The highly controversial decision-making process was the subject of an NBC documentary in 1965 entitled "Who Shall Live?" narrated by Edwin Newman. That gothic portrayal showed the faceless black silhouettes of the anonymous committee members against a stark white screen as they deliberated over the merits of each case. Their authority was final and irrevocable.


The early pioneering work in kidney dialysis sparked a change in thinking about accessibility of health care in this country, and is considered by many to mark the beginning of the modern field of bioethics. The event "opened a new era for the ethics of medicine," writes Albert Jonsen, UW professor of biomedical history and ethics. The health care profession faced "an issue that the traditional ethics of medicine had not previously faced and for which it had no ready response."

The ethical debate over "Who Shall Live" crystallized for the nation the basic principle that health care services should not be an exclusive right of the rich and privileged, of the white-collar worker, the breadwinner, or any other selected "profile." The period of the 1960s and 70s saw a shift away from select individuals or panels deciding who shall live based on physical, financial, and other personal merits, and toward the concept of federally subsidizing expensive health care procedures to make life-saving technologies available to anyone who needs them.

"When the U.S. Congress enacted legislation in 1972 which made all patients with end-stage kidney disease eligible for Medicare, they set a precedent that led to Medicare funding of many of the very expensive technology-based treatments such as coronary bypass open heart surgery, and bone marrow transplantation" reflects Scribner. "Now, in 1995, we are in the midst of a great debate in the Congress over what programs to cut back on to save Medicare from bankruptcy. Sadly, it is quite possible that we may end up eventually with some form of rationing system such as that pioneered by the infamous Seattle Life and Death Committee."


In short -- early Medicare expansion came about specifically in response to rationing, to eliminate "death panels" and the like. That is what existed without the government. Medicare eliminated the need for this sort of rationing. This is also why Medicare is so expensive.

[witchdoctor]

I was going to bring up the renal dialysis question as that was one of the essays on a medical ethics test I took as a first year med student. We were given facts about 10 patients and had to choose the 3 to survive and give our reasons.


In a similar vein, Medicare will not pay for heart transplants for people over the age of 65 years old. However most people do not get Medicare until they are 65 years old. The only way to get a transplant from Medicare is to get Medical disability. Kind of a Catch 22.

[robert99]

With all the talk of "death panels", and fear about the government being involved, a history of dialysis in this country might be useful for some perspective.

http://www.washington.edu/research/pathbreakers/1960c.html






In short -- early Medicare expansion came about specifically in response to rationing, to eliminate "death panels" and the like. That is what existed without the government. Medicare eliminated the need for this sort of rationing. This is also why Medicare is so expensive.

Chickenhead,

Thanks for bringing these aspects and the limited transplant availability issues up - very welcome contributions. These are tough matters worthy of more measured, quiet and grown up debate. As medicine advances some "cures" may get ever more expensive but the public expects them all to be provided on the dot. It is unrealistic, but politicians tend to want to ignore this subject. So the earth is promised and people end up disappointed feeling they have been lied to and cheated by "the system".

In UK, we have an independent panel, National Institute for Clinical Excellence to decide on the general ethical principles and treatments that are of sufficient value to fund. Without limitless resources, somehow the system, any and every system, has to make these hard choices.

[chickenhead]

Chickenhead,

Thanks for bringing these aspects and the limited transplant availability issues up - very welcome contributions. These are tough matters worthy of more measured, quiet and grown up debate. As medicine advances some "cures" may get ever more expensive but the public expects them all to be provided on the dot. It is unrealistic, but politicians tend to want to ignore this subject. So the earth is promised and people end up disappointed feeling they have been lied to and cheated by "the system".

In UK, we have an independent panel, National Institute for Clinical Excellence to decide on the general ethical principles and treatments that are of sufficient value to fund. Without limitless resources, somehow the system, any and every system, has to make these hard choices.

From what I understand, we have something like a 30 trillion dollar gap between what our medicare system is going to cost, and what the funding we have earmarked for it is over the coming decades.

This is the fundamental health care debate that we should be having, but we're in no way able to. Either we are going to pay much more in taxes, or elderly people are going to receive less care than they do now. Picking between two bad choices doesn't lend itself well to political debate, people don't want to talk about those kinds of things, they'd rather focus on demonizing their opponents. But there really isn't a third way so far as I see it -- you are either for higher taxes and higher spending (and most likely higher deficits) for health care, or you're for rationed care. Rationed care meaning more people die that could be saved.

I'm sure we'll end up somewhere in the middle, probably closer to the higher tax higher spend end of the spectrum, but I wish the debate about it was more honest and upfront.

[ArlJim78]

not much talk either about the fraud in Medicare. I saw a study that put it at 10% of the cost vs. about 1% in non Medicare. for me any reform that doesn't address fraud and tort reform is not very helpful.

[chickenhead]

not much talk either about the fraud in Medicare. I saw a study that put it at 10% of the cost vs. about 1% in non Medicare. for me any reform that doesn't address fraud and tort reform is not very helpful.

So we're at a $27 trillion dollar gap. What then?

[ddog]

chick,


Another "story" you could focus on to see some REAL wild costs that can run out forever depending on the outcomes are preemies.


Back in the day, and NOT that long ago, i Still recall it from my youth, infants that would be "saved" today were not even attempted back then.

The doc just did what "had to be done" and that was that.

To "save" those that couldn't be saved back then is a monstrous cost.

That cost can run for the life of the child, how ever long that is.

So, are you and everyone else willing to spend whatever it takes, unlimited sums over the course of the episode to "save" and/or prolong the life of a being that would never have lived 20-30 years ago?


If so, you do know that no insurance can cover that and no family of anywhere near normal means can afford the costs.

[NJ Stinks]

On a similar vein, I have a 86 year old uncle. Despite having 2 heart attacks in the last 2 years, he decided he wanted a hip replacement. Understandable since he could barely stand up but also very risky. His heart doctor was against it but finally relented. (My uncle told me he had to sign a ton of paperwork that basically held all associated with the hip replacement blameless if it went bad.)

At the end of March, my uncle had the hip replacement. Two days later he had a another heart attack. The next 4 days he was unconscious and kept alive by machines. He had a living will that said he didn't want to kept alive by machines but the doctors in the hospital told his daughter he had a good chance of recovery. Of course, she listened to the doctors. On the 5th day he was conscious. He then spent about 6 more weeks in the hospital. (He almost died a few times during those 6 weeks). Next he went to a convalescent home for continued around the clock monitoring and therapy. His insurance coverage at the convalescent ran out after a month. Rather than pay the $300 a day himself for the convalescent home, he went home where the therapy sessions continued at his house. Meanwhile his daughter returned home from Arizona to take care of him. (His wife died about 10 years ago.)

Today, he is very weak and struggles to stand. In fact, even with a walker, he has taken some nasty falls. He told me matter-of-factly that he doesn't expect to be around much longer. He also said he doesn't want to live if he can't even drive or play golf.

Obviously, no one thought about rationing health care relating to my uncle. I honestly cannot understand why no one did and I love the guy.

[46zilzal]

The history of a patient on dialysis is not that long. It is a stop gap measure at best. When renal function is that far gone other systems suffer, particular the cardiovascular system.
http://content.nejm.org/cgi/content/full/341/23/1725

[Warren Henry]

The history of a patient on dialysis is not that long. It is a stop gap measure at best. When renal function is that far gone other systems suffer, particular the cardiovascular system.
http://content.nejm.org/cgi/content/full/341/23/1725

I am not sure how your link applies to the intent of the OP in this thread. Did you just take a couple of the words from his title, do a search and post the link for the first study that came up.

You seem to need to impress us with your medical background/experience, yet you don't seem to even understand the context of a thread.

Perhaps you can enlighten us - use small words. :lol:

[lsbets]

Warren,

Do you remember his post in the Genetic Algorithm thread? It was classic.

[witchdoctor]

not much talk either about the fraud in Medicare. I saw a study that put it at 10% of the cost vs. about 1% in non Medicare. for me any reform that doesn't address fraud and tort reform is not very helpful.

Jim
The number you see is probably accurate. Unfortunately, the regulations for billing for Medicare is about 800 pages long and more confusing than the IRS laws. In addition, Medicaid has a complete different set of rules and these are often in conflict with the Medicare rules. Add in the rules for hospital admissions(another 1000 pages) and it is even more convoluted.

Our 11 man practice has an EMR that checks our notes against the various rules and them we have 3 "professional coders" that review each note to make sure the billing is correct before submission to Medicare or insurance. We also hire consultants come in and audit us 2-3 times a year to get a second opinion on how we are doing. We usally are 97-98% accurate although we did drop to 95% one time when Congress changed the rules. So in the government's eyes, we bill fraudulently 2-5% of the time.

As much as I think we need to reform the medical system in this country, the idea of having even more rules to follow makes me sick. I just want to take care of patients.

[46zilzal]

I am not sure how your link applies to the intent of the OP in this thread. Did you just take a couple of the words from his title, do a search and post the link for the first study that came up.

You seem to need to impress us with your medical background/experience, yet you don't seem to even understand the context of a thread.

A lot of people think dialysis is open ended. It is not. End of enlightening converstaion

[Warren Henry]

Warren,

Do you remember his post in the Genetic Algorithm thread? It was classic.
Even when he attempts to defend himself, he misses the point.

Total fool IMHO.

[ddog]

yep. the old bob and weave , shuck and jive duck and dodge, when they(pugs/cons) got nothing to say CHANGE the focus go for the gutter.

[highnote]

The history of a patient on dialysis is not that long. It is a stop gap measure at best. When renal function is that far gone other systems suffer, particular the cardiovascular system.
http://content.nejm.org/cgi/content/full/341/23/1725


46,

Glad you posted this. I don't understand why the others are so critical of this post. I understand exactly the point you were trying to make.

I had the same thought. I've had relatives who went on dialysis. They didn't live long after they started. It seemed to take a toll on their bodies. Maybe it wasn't dialysis that was so hard on them, maybe it was that their bodies were in such poor condition when they began dialysis?

With or without dialysis the term of their life was expected to be short.

[PaceAdvantage]

Hitler also thought it would be wise to rid society of the weak and costly, did he not?

Yes, an extreme example, but applicable to the thread and the discussion. I'm sure I'll simply be relegated to the "right wing shuck and jive" pile by ddog, but the language some are using in this thread immediately conjure these images up in my head.

You know the ol' slippery slope argument...where to draw the line?

Who or what will be the "great decider" when it comes to these kinds of decisions? And if you're on the losing end of the stick, I'm sure you're going to be very happy America instituted this kind of system....:rolleyes:

[Rookies]

Two personal stories, kind of in the middle of this latest segue of the topic.

#1 My 83 year old Mom has Basal Cell Carcinoma. Shes' had 3 bouts since she was 50. About 2 years ago, the best Cancer Surgeons in Toronto huddled with myself, my sister & I to advise that her cancer had returned. The last one lasted 11 hours on the operating table, rather than 3.5. This one would have had to remove her nose and part of her palate.They were ready to proceed with surgery, following work up, in less than a month. After listening to them, we had a series of questions, one of which was the following:

"If she DOESN'T have the surgery, what is her life expectancy?"
"About 5 years" says the surgeon.

"And if she does have it ? "
"The same."

But with constant appointments for prosthesis, much pain and becoming an invalid for a year. No driving- which she still does, no leaving the house.

We came to our collective decision: "No."

#2 On the U.S. side of the border, an 81 year old relative of my better half, was " short of breath" after playing 18 holes of Golf. He was looking for medical intervention as he had rheumatic fever as a kid, that had done some damage to the valves.

His partner pushed to look for the best medical facility in the U.S. to perform the procedure. It is one cited here and would be 1-2 with Mayo as having the highest quality and best care- a world forerunner. And so, away they went and many thousands of dollars later, things went badly- very badly. We just visited and he is not the robust senior I saw 2 years ago in Vegas. He is sinking fast and eating liquids only, afraid to swallow.

I pray for him, especially as he was so good to my wife's Mom & Dad, when their health went south at the begining of the decade.

My solution (tho' none of my biz in this case) would have been: " Play 9 ! "

Sometimes, the best medical solution is none- depending on age, etc.

[chickenhead]

Hitler also thought it would be wise to rid society of the weak and costly, did he not?

Yes, an extreme example, but applicable to the thread and the discussion. I'm sure I'll simply be relegated to the "right wing shuck and jive" pile by ddog, but the language some are using in this thread immediately conjure these images up in my head.

You know the ol' slippery slope argument...where to draw the line?

Who or what will be the "great decider" when it comes to these kinds of decisions? And if you're on the losing end of the stick, I'm sure you're going to be very happy America instituted this kind of system.

So I'll put you down in the unlimited federally funded health care for all those who can't afford it camp. No losing sticks for anyone, no slippery slopes. Just a blissful ride to total bankruptcy. Sounds expensive to me, but what do I know.

See, this is why I ask these things -- I always assumed it was only the Liberals that were for that kind of thing.

[exactaplayer]

Hitler also thought it would be wise to rid society of the weak and costly, did he not?

Yes, an extreme example, but applicable to the thread and the discussion. I'm sure I'll simply be relegated to the "right wing shuck and jive" pile by ddog, but the language some are using in this thread immediately conjure these images up in my head.

You know the ol' slippery slope argument...where to draw the line?

Who or what will be the "great decider" when it comes to these kinds of decisions? And if you're on the losing end of the stick, I'm sure you're going to be very happy America instituted this kind of system....:rolleyes:
Et tu Brute ?
The decision to have medicare pay for end of life consultations was put in the bill by a Georgia Republican. No one is advocating anything different then current conditions. Most folks as they age create living wills or documents pertaining to there care in terminal conditions. ( incurable cancer, massive stroke and so on). Some years back my father went in the hospital for surgery on that aorta thing in your stomach. he was in surgery for a long time and when he came out he was paralyzed from the waist down and his kidneys were no longer functioning. His Doctor told him he would be on dialysis for the rest of his life and in a wheelchair. My dad told the doctor "no thanks, just give me morphine so i can exit peacefully." He stopped living within 24 hours of that decision. These are personal decisions and nothing in the bill changes that.

[Tom]

Hitler also thought it would be wise to rid society of the weak and costly, did he not?



You know where he got that from.....from Obama's political forefathers - the American Progressives, many of whom thought Hitler never went far enough!
One of Barry's czars thinks abortions up to 2 years old are a good thing!
Ties in to the death panels, I would say. You want Gerbils to be your doctor?

[exactaplayer]

Here is a link for a reality check for you folks that are in fear based on the rumors being spread by the insurance industry.
http://www.whitehouse.gov/realitycheck/

[Tom]

Looks like a campaign site to me.
Why should we believe any of them?

Obama has lied repeatedly.....why do believe him now?

Why has he NOT ONCE pointed out specific language in the bill to back up any of his claims?

[Warren Henry]

Here is a link for a reality check for you folks that are in fear based on the rumors being spread by the insurance industry.
http://www.whitehouse.gov/realitycheck/

And you would believe the Whitehouse spin website? Find another (slightly reputable) source.

[NJ Stinks]

And you would believe the Whitehouse spin website? Find another (slightly reputable) source.

You mean sources like the Death Panel duo -Grassley and/or Palin? :rolleyes:

[exactaplayer]

And you would believe the Whitehouse spin website? Find another (slightly reputable) source.
You mean like the Insurance moguls or are you referring to someone like Limbaugh or Beck ?

[Tom]

Grassly and Palin - show who is quoting them as sources???

Rush/Beck - they direct us to sources.......like I said, if Barry is right, when is he going to point us to the specific language that backs him up?

Talk is cheap. Especially from a proven liar.

[PaceAdvantage]

Et tu Brute ?
The decision to have medicare pay for end of life consultations was put in the bill by a Georgia Republican. No one is advocating anything different then current conditions.I'm not talking about end of life consultations. I'm talking about the MINDSET that begins to apply this "who is worthy of what" thinking on a MASS SCALE.

Yes, organ transplant waiting lists are biased towards "more worthy" candidates (for instance, I would think a sick teenager would receive a liver over a 60-year-old chronic alcoholic). But those are rare events in the grand scheme of things.

This proposed new federal health care program would put that kind of thinking into effect on a mass scale and for a lot more "every day" life-ending medical conditions.

[chickenhead]

I'm not talking about end of life consultations. I'm talking about the MINDSET that begins to apply this "who is worthy of what" thinking on a MASS SCALE.

Yes, organ transplant waiting lists are biased towards "more worthy" candidates (for instance, I would think a sick teenager would receive a liver over a 60-year-old chronic alcoholic). But those are rare events in the grand scheme of things.

This is how Medicare works TODAY. Ever heard of it? Government officials decide what is covered and what isn't, based on what. For millions and millions and millions of elderly Americans. All of them, more or less.

It's not a rare event in the grand scheme of things for insurance to cover only certain things -- no matter who is running it. It's one of the most basic, fundamental aspects of any insurance program. None of them are carte blanche, including Medicare, including your insurance program, including any insurance program.

[exactaplayer]

I'm not talking about end of life consultations. I'm talking about the MINDSET that begins to apply this "who is worthy of what" thinking on a MASS SCALE.

Yes, organ transplant waiting lists are biased towards "more worthy" candidates (for instance, I would think a sick teenager would receive a liver over a 60-year-old chronic alcoholic). But those are rare events in the grand scheme of things.

This proposed new federal health care program would put that kind of thinking into effect on a mass scale and for a lot more "every day" life-ending medical conditions.
Ok,
Who is making the decisions now. I recall years back when Mickey Mantle got a liver transplant as an old man who had a drinking problem. Rumors said he was moved up on the list because of his history/wealth/connections or whatever.

[46zilzal]

Ok,
Who is making the decisions now. I recall years back when Mickey Mantle got a liver transplant as an old man who had a drinking problem. Rumors said he was moved up on the list because of his history/wealth/connections or whatever.
Rumors? Fat cats with connections get everything handed to them. RUMOR?? funny stuff

[PaceAdvantage]

This is how Medicare works TODAY. Ever heard of it? Government officials decide what is covered and what isn't, based on what. For millions and millions and millions of elderly Americans. All of them, more or less.Medicare...another well run, cost effective, paying-for-itself government run program?

I think my point still stands, does it not?

[chickenhead]

Medicare...another well run, cost effective, paying-for-itself government run program?

I think my point still stands, does it not?

In some bizzarro world maybe -- you are arguing two completely opposite points. Effectively arguing Medicare should cover more shit (wouldn't want to "ration care" -- and now you say it's too expensive? In the real world, you have to make up your mind.

I'll try to make this as crystal clear as possible.

The BIGGEST mistake this country can make -- the worst possible outcome of this scenario -- is that the government option is TOO GOOD. That is covers TOO MUCH SHIT. All the arguments about rationing, all the arguments spreading Fear and Uncertainity about it being TOO SHITTY, provide the fodder for making it MORE EXPENSIVE.

The best universal system we could possible have for universal coverage, if you just assume that we are going to get one at some point -- would be a high deductible, catastrophic type insurance. In other words, it would be pretty shitty. You would WANT people to have to buy supplemental private insurance. The LAST THING IN THE WORLD you would want -- is for it to be a gold plated, anything goes, we'll pay for whatever you want. Which is precisely what you are arguing for. For Chrissakes you are comparing cost controls to Hitler style Eugenics. Good job!

So everyone should be cognizant of that fact -- all the FUD that's getting spread around, all the hyped of fears of death panels and rationing -- all that does is help along the argument to spend even MORE MONEY, and to make this f'ing thing EVEN MORE expensive.

You seriously want that to be your primary argument against the Democrats...that they aren't spending enough on a social program? What's next, are you going to taunt a hungry bear because he hasn't eaten you yet?

[Tom]

Rumors? Fat cats with connections get everything handed to them. RUMOR?? funny stuff

Evidence?
Facts?
Got any, or is baseless ranting all you have.
(Rhetoric questions!):rolleyes:

[DRIVEWAY]

I'm not talking about end of life consultations. I'm talking about the MINDSET that begins to apply this "who is worthy of what" thinking on a MASS SCALE.

Yes, organ transplant waiting lists are biased towards "more worthy" candidates (for instance, I would think a sick teenager would receive a liver over a 60-year-old chronic alcoholic). But those are rare events in the grand scheme of things.

This proposed new federal health care program would put that kind of thinking into effect on a mass scale and for a lot more "every day" life-ending medical conditions.

Steve Jobs lives in California. He received a liver transplant in Tennesee. Jobs gamed the system.
http://rds.yahoo.com/_ylt=A0geuruum4VKilgAyCNXNyoA;_ylu=X3oDMTB0OGJiZzI yBHNlYwNvdi10b3AEY29sbwNlBHZ0aWQDBHBvcwMx/SIG=1fth32a0r/EXP=1250356526/**http%3a//rc10.overture.com/d/sr/%3fxargs=15KPjg1%252DpSm5amwryrfL3PROuKwFkFgszv%25 5F85tCJR6HdJe8nB7ALxyb6PDnsx4SOVj7w7GnK%252DZ9aEQL %255FL4nfOOGwiPTFaLHOL32JqVk4Y5M6ejWtFFj7Zs8NK2k4R MNHsGZGqyf36PrvCMLdX8P2gav4ICzB2PjqktzM60wuIeF7%25 5FR2FJ%255F7Q2FLJoZk%255F9rxZTVeMgETLdQDdibkyGXBJ0 1z9l8lPv1bS0SeBuS9m4OqVuJUTh9oay4atAEv7Pvm4mbd%252 DL1lMdcaEKFpaBuu0%255FImivf2dA8ZGrBzeYfxUhVHqZMUWD vyxukm7iOyfC7GexE6D2vX52OGjimOR0kEx0xPfupeAfYSih4s HHCMIMXNcSm7HLmDbCQXHpqVhBA35H0CP9A7g3en31jC3DJS5T 2iB8%252E

[Tom]

And that is a reason to tear down the whole HC system?
Why not fix that part of it?

Do you tear down your house when a door sticks?

[exactaplayer]

And that is a reason to tear down the whole HC system?
Why not fix that part of it?

That is exactly what we are trying to do.

[Tom]

No, not at all.
The plan is to re-invent the whole system.

[DRIVEWAY]

And that is a reason to tear down the whole HC system?
Why not fix that part of it?

Do you tear down your house when a door sticks?

Your right. Ninety percent of the solution is defining the problem. However, when it comes to HC people can't agree about the problem.

Organ transplants is just one issue. Hopefully, there's some agreement and improvements will follow. There doesn't appear to be much agreement elsewhere. People on this board have wide ranging views of Medicare.

Those on Medicare are protesting because they think benefits will be cut. Many are against a public option but are on Medicare and in favor of continuing Medicare!!!

Others think Medicare is evil and are against any type of government involvement.

Please tell me where there is middle ground. Then maybe people can define the problem.

To those who are against Medicare and Social Security, I can only wonder what a disaster would follow if those programs were severly cut or curtailed.

Reform will either be scuttled or rammed through the house and senate. There will be no compromises. This shapes up as public option reform or nothing at all.

When people talk about evil, nazi's, death panels, rationing etc. reason has taken a vacation.

Many will be unhappy.

[PaceAdvantage]

In some bizzarro world maybe -- you are arguing two completely opposite points. Effectively arguing Medicare should cover more shit (wouldn't want to "ration care" -- and now you say it's too expensive? In the real world, you have to make up your mind.Medicare shouldn't cover more shit..that's not what I advocate.

I advocate simply less government involvement in these sorts of giant social issues. The gov't, it has been proven time and again, can't run any large social program economically and within reasonable costs. Why give it another chance to screw everything up, this time with the LARGEST program ever conceived?

[DRIVEWAY]

There are 45,000,000 Americans covered under the socialzed medicine called Medicare. The overwhelming majority of these Medicare participants are pleased with their coverage.

The administrative costs for Medicare are 4% compared to an average of 30% with private insurers. Who among you believe that Private Insurance could do a better job than Government Medicare?

[Saratoga_Mike]

There are 45,000,000 Americans covered under the socialzed medicine called Medicare. The overwhelming majority of these Medicare participants are pleased with their coverage.

The administrative costs for Medicare are 4% compared to an average of 30% with private insurers. Who among you believe that Private Insurance could do a better job than Government Medicare?

Get your facts right. If the administrative costs for Wellpoint, United, Humana or Aetna were 30%, they'd be out of business, as their MLRs run in the approximately 80% to 85% range. Let me translate all of this. For each dollar of revenue a United Health takes in, they spend roughly 80 to 85 cents on medical care (paying hospitals, docs, PX, etc). So they're left with 15 to 20 cents b/f covering SG&A. If SG&A totaled 30%, they'd all lose money.

All that said, Medicare has more scale than any of the private plans. Therefore, their administrative costs are lower than the private players* - you just have the magnitude incorrect. *Depending on cost allocations for CMS.

[DRIVEWAY]

Get your facts right. If the administrative costs for Wellpoint, United, Humana or Aetna were 30%, they'd be out of business, as their MLRs run in the approximately 80% to 85% range. Let me translate all of this. For each dollar of revenue a United Health takes in, they spend roughly 80 to 85 cents on medical care (paying hospitals, docs, PX, etc). So they're left with 15 to 20 cents b/f covering SG&A. If SG&A totaled 30%, they'd all lose money.

All that said, Medicare has more scale than any of the private plans. Therefore, their administrative costs are lower than the private players* - you just have the magnitude incorrect. *Depending on cost allocations for CMS.

These companies are into multiple insurance lines. Please direct me to a breakdown of SG&A by line of business. Disability, Life, Casualty, Home and Auto are significantly lower administrative costs. It makes sense that Health Insurance Administrative costs are greater than the overall average.

Are your percentages company wide?

[Saratoga_Mike]

These companies are into multiple insurance lines. Please direct me to a breakdown of SG&A by line of business. Disability, Life, Casualty, Home and Auto are significantly lower administrative costs. It makes sense that Health Insurance Administrative costs are greater than the overall average.

Are your percentages company wide?

I mentioned UNH, HUM, AET and WLP. Let's forget about Aetna b/c the multiple business lines. Let's focus on UNH, WLP and HUM. These three players focus primarily on commercial and Medicare Advantage. The first two also play in the Medicaid market. And I also believe UNH and WLP have very small dental businesses (I'd like to double check that), but they're rounding error to the big picture. So let me pull up the SG&A for these three. I'll use 2008 numbers from sec.gov.

[Saratoga_Mike]

My estimates for 2008 SG&A as a percent of revenue* (as reported--using 2008 10Ks):

UNH 18.1% (that is not trend)
HUM 13.7%
WLP 14.6%

If you normalize SGA at UNH, I suspect you'd land on a 15% number for the three players on average. It just isn't 30%. Trust me, they'd all be out of business at 30%. However, in the insurance business a 2% to 3% scale difference is very significant.

*excludes interest income

[DRIVEWAY]

I mentioned UNH, HUM, AET and WLP. Let's forget about Aetna b/c the multiple business lines. Let's focus on UNH, WLP and HUM. These three players focus primarily on commercial and Medicare Advantage. The first two also play in the Medicaid market. And I also believe UNH and WLP have very small dental businesses (I'd like to double check that), but they're rounding error to the big picture. So let me pull up the SG&A for these three. I'll use 2008 numbers from sec.gov.

There are approximately 1300 companies in the USA in the Health Insurance Business. Some are small companies in just one state. Now the larger companies should have better SG&A percentages than the small and mid-size companies. The law of large numbers insures that.

Additionally, SG&A for medicare and Medicaid should be less than group commercial and individual policies.

The 4% number needs to be compared to commercial group and individual. Also, the gross profit percentage needs to be accounted for. Medicare is non-profit. Then you'll have an apples to apples comparison.

16% --SG&A + Profit% is 4 times Medicare
20% --SG&A + Profit% is 5 times Medicare
30% --SG&A + Profit% is 7.5 times Medicare

It's only a question of how inefficient private Health Insurance vs. Government Health Insurance is. Four, Five or Seven times less efficient.

[Saratoga_Mike]

There are approximately 1300 companies in the USA in the Health Insurance Business. Some are small companies in just one state. Now the larger companies should have better SG&A percentages than the small and mid-size companies. The law of large numbers insures that.

Additionally, SG&A for medicare and Medicaid should be less than group commercial and individual policies.

The 4% number needs to be compared to commercial group and individual. Also, the gross profit percentage needs to be accounted for. Medicare is non-profit. Then you'll have an apples to apples comparison.

16% --SG&A + Profit% is 4 times Medicare
20% --SG&A + Profit% is 5 times Medicare
30% --SG&A + Profit% is 7.5 times Medicare

It's only a question of how inefficient private Health Insurance vs. Government Health Insurance is. Four, Five or Seven times less efficient.

If you look at Amerigroup and Centene, two Medicaid players, in 2006 (prior to their entering the MA market), you'll see their SGA at 13% and 15% of revenue, respectively.

In any case, you stated a 30% number. Why not just admit that was a mistake? We all make mistakes. It doesn't necessarily take away from the substance of your overall argument.

The 4% number depends on how you allocate the cost of running CMS.

I don't follow your 4, 5 and 7.5x argument.

You do realize that private commercial players subsidize Medicare and especially Medicaid rates? And without such subsidies most hospitals would cease to exist.

And you're focused on SG&A. What about controlling costs? Traditional Medicare FFS has no incentive to control costs.

In any case, I still think your scale argument has some merit. I just think your numbers are wrong.

[DRIVEWAY]

If you look at Amerigroup and Centene, two Medicaid players, in 2006 (prior to their entering the MA market), you'll see their SGA at 13% and 15% of revenue, respectively.

In any case, you stated a 30% number. Why not just admit that was a mistake? We all make mistakes. It doesn't necessarily take away from the substance of your overall argument.

The 4% number depends on how you allocate the cost of running CMS.

I don't follow your 4, 5 and 7.5x argument.

You do realize that private commercial players subsidize Medicare and especially Medicaid rates? And without such subsidies most hospitals would cease to exist.

And you're focused on SG&A. What about controlling costs? Traditional Medicare FFS has no incentive to control costs.

In any case, I still think your scale argument has some merit. I just think your numbers are wrong.

Streamlining the administrative nightmare that all Doctors and Hospitals must deal with as a result of 1300 Health Insurance Companies and 10's of thousands of different policies is probably the single easist way of reducing costs. Medicare does that for 45,000,000 people. That's one of it's strengths.
It's administrative costs are a fraction of the typical Health Insurance Company and the cost to administer by Doctors and Hospitals is similarly less burdensome.

Your SG&A costs in your original post were 15-20%. Your second post changes the carriers and drops to 13-15% for Medicaid providors.

Apples to Apples comparisons for commercial group and individual health insurance SG&A is the needed percentage. When you find the answer to be in the neighborhood of 30% industry wide don't be surprised.

[Saratoga_Mike]

Streamlining the administrative nightmare that all Doctors and Hospitals must deal with as a result of 1300 Health Insurance Companies and 10's of thousands of different policies is probably the single easist way of reducing costs. Medicare does that for 45,000,000 people. That's one of it's strengths.
It's administrative costs are a fraction of the typical Health Insurance Company and the cost to administer by Doctors and Hospitals is similarly less burdensome.

Your SG&A costs in your original post were 15-20%. Your second post changes the carriers and drops to 13-15% for Medicaid providors.

Apples to Apples comparisons for commercial group and individual health insurance SG&A is the needed percentage. When you find the answer to be in the neighborhood of 30% industry wide don't be surprised.

And 13% to 15% isn't in the range of "approximately 15% to 20%?" Give me a break. UNH's SG&A was 17.7% in 2002. Got it? That was b/f they entered the Medicare or Medicaid mkt in any meaningful way. You said 30%. You're wrong. Period. You haven't posted one statistic refuting any metric I've cited. And you won't b/c all of my numbers are correct. Just b/c you read something in the New Republic or on moveon.org doesn't make it true. Don't ask me for anymore numbers - I conceded your scale pt was still valid despite your 30% number, but you aren't worth dialoguing with. Good night.

[Tom]

The govt is responsible for many of the high costs of HC. Let us shop all 50 states for our policies and watch the prices drop. Everything else this moron does is urgent and has to be done by Friday...why can't the govt change this rule immediatle and let competition kick in Friday?

It is NOT about HC or anything else but power and control for the gov. Get that in your head. WE do not matter at all, nor our health.

[highnote]

I'm not talking about end of life consultations. I'm talking about the MINDSET that begins to apply this "who is worthy of what" thinking on a MASS SCALE.

Yes, organ transplant waiting lists are biased towards "more worthy" candidates (for instance, I would think a sick teenager would receive a liver over a 60-year-old chronic alcoholic). But those are rare events in the grand scheme of things.

This proposed new federal health care program would put that kind of thinking into effect on a mass scale and for a lot more "every day" life-ending medical conditions.

But what if the sick teenager is sick because he/she tried to knock off a convenience store and killed a cashier, then when trying to escape was involved in a high speed chase and the teenager crashed and severly damaged his/her liver and needed a transplant.

And what if the 60 year old chronic alcoholic has been recovering for 5 years and has not had a drink, has become involved with community service and has donated large sums to charity.

The teenager will need the public assistance to pay for the operation, while money is not an issue for the wealthy 60 year old chronic alcoholic.

Or how about this scenario:

What if the teenager is a perfect angel but poor and will need government assistance to get the transplant and the 60 year old wealthy chronic and NOT yet recovered alcoholic can pay for the transplant him/herself? Then who decides and how?

Should the taxpayer pick up the tab for the poor teenager or should the teenager die? Should the wealthy 60 year old alcoholic jump to the front of the line because he can afford to pay or should someone else, more deserving, get the liver -- even if the taxpayers have to pick up the cost?

Or here's another scenario:

What if the teenager did kill the cashier and did get in a high speed chase and crash and damage his/her liver, but the teenager was just out for a thrill seeking joyride and is really a wealthy heir to a large fortune and can afford the transplant. The 60 year old chronic alcoholic is a sweetheart of a person, who has never done wrong, except for drink too much, but is very poor.

Now who should get the liver?

[robert99]

sweetyjohn,

These are the real hard ethical issues that grown ups have to make decisions upon. The real issues are now totally drowned out and the debate has disintegrated into a shambles. A terrific advert for democracy around the World, I don't think or "Not" as some seem to say.

[Tom]

What has happened is the people woke up told their government to go pond salt. The Big Jerk is baking off his public option today - like he ever really had a plan to begin with - he was obviously lying through his teeth at every opportunity.

What is really go about this is maybe people will finally realize we cannot ever trust our government - ever. We must not feel compelled to give the benefit of the doubt or ever show them any respect unless they earn it. We need to treat them like dogs, make them live in fear of us. Maybe they will remember that this bunch of lying thieves work for us, and we can discard them at our whim whenever we want to.