You Get What You Pay For

Primary care physicians have come under criticism because they have not counseled their patients and encouraged them to execute an advance directive and a medical durable power of attorney.   This is felt to be a factor in the leading to the large percentage of the dollars spent by Medicare in the last year, and especially in the last few days of life.  There is pretty good data that appropriate use of Hospice leads to both a higher patient satisfaction, and lower costs than control groups of patients who do not use hospice in their last months and weeks. So given this why doesn’t every patient come to their physician and demand to discuss end of life issues, and why doesn’t every primary care physician strongly encourage their patients to consider executing an advance directive and a medical durable power of attorney?  It’s really pretty simple.  Our health care reimbursement system gets exactly what it incentivizes.

If a senior patient chooses to make an appointment with their physician at any time other than at their Welcome to Medicare exam (a visit where since 2009 for a modest payment their physician is supposed to do a complete history, physical exam, EKG, discuss end of life issues and give counsel about advance directives and medical durable power of attorney) the patient is faced with paying the copayment and deductible portion of the fee for the visit, and the physician up until the current health care reform has not been able to bill specifically for these services.  This has just been considered a minor detail to lump into a visit for hypertension, diabetes, or whatever else brings the patient to the physician.

It really would be quite simple to vastly increase the number of seniors with completed advance directives and medical DPAs.  Just make it financially advantageous for patients to make this a part of a physician visit periodically, maybe every 5 years or more often if certain new diagnoses are made, and compensate the physician well enough that physicians will bring the subject up during visits.  This could be as simple as making these visits  fully paid for by Medicare (no copay, no deductible) if the visit includes counsel about advance directives and medical DPA, and the patient agrees to executes an advance directive and name someone as their medical DPA within 30 days of the visit.  Also create a billing code to add to these visits such that the physician is paid 25% extra for the visit during which the counseling takes place.  Allow this incentive only for outpatient visits.  Once the patient is at the hospital it’s really too late to effectively accomplish much of the benefit of advance directives and medical DPAs.   If this policy leads to a large majority of Medicare patients maintaining a current advance directive and naming someone as having their medical DPA, it could save big sums of money by avoiding the days in hospital  ICU beds used by families to work through these issues, often without valid input from the patient involved.  It might also increase use of hospice at appropriate times, leading to yet further savings.  In addition it is incentivizing patients and physicians to address these issues before crisis is at hand.  Even if there is no savings, it incentivizes both patients and primary care physicians to tackle this topic early and regularly.

There may be a better way to incentivize patients to execute advance directives and designate a medical DPA, and I’m all for someone thinking of a better way to do this, but most Americans are bright enough and frugal enough to take advantage of financial incentives, and I suspect most primary care physicians are too.

For any interested patients here is a link to a resource for all 50 states for advance directives.

I really dislike the term healthcare reform.  I think our system needs to be changed not reformed.  I assume that I am not the only person who suspects that the recent health care reform act is not going to be the final solution for America’s health care problems.  The cost of healthcare is not really addressed at all, and even if it works better than expected some Americans will not have even catastrophic health care coverage.

This post is really just my first shot at  suggesting a way I think makes sense to address the problem of the large number of uninsured people in America, while at the same time leaving lots of choice and personal responsibility that seems to be needed and a part of the American culture.  I am certain that I have not thought through all of the gritty details, and really don’t profess to have the talent or knowledge to write legislation, but I think this basic tenant might be a starting point.  First my assumptions:

1.  The biggest issue facing Americans who are uninsured is the possibility of personal financial ruin from a major medical condition.
2. Americans want personal choice in choosing a medical plan and providers.
3. American corporations are at a global disadvantage in having to pay for expensive health insurance plans that put their cost of producing goods and services higher than in countries with governmental health insurance.
4. If American’s were more responsible for their health care costs, it is likely that they would take a greater responsibility for how their dollars are spent on healthcare than if they are spending other people’s money.

Next the basic elements of a solution:

1. The federal government provides every American with a catastrophic coverage medical plan.  This would be a very high deductible plan to cover expenses over a chosen amount, say $5000./ family per year. (this number could be different, depending on actuarial and legislative input)  This would be paid for by a national tax of some sort, maybe a combination of a corporate payroll tax and health coverage value added tax, or other individual tax.
2. Individuals and employers could choose to purchase supplemental coverage for themselves or their employers beyond this catastrophic coverage.  Most Americans would want to at least purchase access to a PPO type of network to access discounted fees negotiated between providers of services and insurance plans, much like PPO fees now.  They could also choose to contribute to a HSA account to save/pay towards the deductible or to a supplemental plan to cover some or most of the deductible expenses. There would be no mandated services to be covered in these supplemental plans.  Individuals could choose what services they want to have insured.  This would allow insurance companies to offer plans tailored to the desires and needs of individuals, not the current every willing provider, cover everything for everyone that the many current mandates dictate.  If we ar ready for really big change, this could be for all Americans, and our less affluent elderly and our poor could have some sort of assistance in purchasing supplemental insurance to replace Medicare and Medicaid. 

That’s pretty much it.  Everyone would have catastrophic national health coverage to prevent most Americans from facing the risk of financial ruin from an accident, injury, or illness.  We could all choose to purchase whatever other coverage meets our needs on a open market, without regulated mandatory coverage of any services we might choose not to purchase.

I’m hoping to have this topic be an ongoing forum for discussion.  Comments, better ideas, suggestions for major problems I’ve neglected to address, and the expected outrage that this idea is a step toward socialism, fascism, or some other ism is welcome.  Make comments and join the dialogue.