Category: US/World Health Care Policy

The Myth of the Medical-Device Tax – NYTimes.com

 

Not only can the medical-device industry easily afford the tax without compromising innovation, but the industry’s enormous profits are a result of anticompetitive practices that themselves drive up medical-device costs unnecessarily. The tax is a distraction from reforms to the industry that are urgently needed to lower health care costs.

The medical-device industry faces virtually no price competition. Because of confidentiality agreements that manufacturers require hospitals to sign, the prices of the devices are cloaked in secrecy. This lack of transparency impedes hospitals from sharing price information and thus knowing whether they are getting a good deal.

Even worse, manufacturers often maintain personal relationships (sometimes involving financial payments like consulting fees) with physicians who choose the medical devices that their hospitals purchase, creating a conflict of interest. Physicians often don’t even know the costs of the devices, and individual physicians often choose devices on their own, which weakens a hospital’s ability to bargain for volume discounts.

Such anticompetitive practices help generate a wide variation in the prices of medical devices — and contribute to higher prices in general. For example, the Government Accountability Office found that prices for cardiac implantable medical devices in the United States vary by several thousand dollars. And even the lowest-priced devices in the United States are expensive compared with those in other developed countries. According to the consulting firm McKinsey & Company, the United States spends about 50 percent more than expected on the top five medical devices, compared with Europe and Japan. McKinsey calculates that this amounts to $26 billion in excessive spending each year. Medicare, private health insurers and patients end up paying these inflated prices.

Excessive prices fuel enormous profits — profits that dwarf both the medical-device tax and the industry’s investments in research and development. Consider the device division of Johnson & Johnson, which in 2012 had an operating profit of $7.2 billion. By the company’s own estimate, the device tax would amount to at most $300 million, and its investment in research and development amounts to only $1.7 billion.

The Myth of the Medical-Device Tax – NYTimes.com

High health care costs: It’s all in the pricing – The Washington Post

High health care costs: It’s all in the pricing – The Washington Post: Ezra Klein

…the International Federation of Health Plans — a global insurance trade association that includes more than 100 insurers in 25 countries — released more direct evidence. It surveyed its members on the prices paid for 23 medical services and products in different countries, asking after everything from a routine doctor’s visit to a dose of Lipitor to coronary bypass surgery. And in 22 of 23 cases, Americans are paying higher prices than residents of other developed countries. Usually, we’re paying quite a bit more. The exception is cataract surgery, which appears to be costlier in Switzerland, though cheaper everywhere else.

The PDF of the PowerPoint (of the trailer of the film…) from IFHP is here.

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25 Best Global Healthcare Rankings

Interesting web site with all these links on International comparative health care. 

25 Best Global Healthcare Rankings: Healthcare Infographics

These interesting infographics help you visualize various healthcare rankings, and can help you see just where your country of residence sits.

  1. Global Health-Care Snapshot: Presents a ranking of countries by how much they spend as a percent of GDP. Includes comparisons of costs in 1980 and in 2006 so that you can see where health care costs have grown the most. Includes helpful information on how people are insured in developed countries, and tabs that illustrate life expectancy and infant mortality.
  2. Health Care Expenditures: An International Comparison: This infographic ranks different expenditures on healthcare by country. Expenditures considered include nursing homes, administration, medications, hospitals and more. An interesting way to break down healthcare costs.
  3. U.S. Healthcare Quality: Get a look at how countries are ranked in terms of health care quality. This infographic looks at different factors related to quality, and ranks different countries.

There are lots more…
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Physician Incomes Internationale

Responding to my post about doctors stepping up for health reform over at FireDogLake, wigwam linked to a couple great pieces from the NY Times. ( I have a Google Alert on “physicians salaries incomes,” so I don’t know how I missed them, but, here they are now.)

In order, Uwe Reinhardt pointed out in a post about Rationing Doctors’ Pay

When Medicare reduces its payments to doctors, it rations money to them. It does not directly ration the health care the doctors might render patients.

If physicians refuse to treat patients at the lower fees, it is they who ration health care, even if the incentive to do so came from Medicare.

While I doubt that the payments to radiologists and cardiologists actually will be cut by 21 percent soon — more on that next time — let us suppose it were so. Would there then be “few radiologists and cardiologists working” after such a fee cut?

Presumably, the afflicted physicians would withhold their services only from Medicare and Medicaid patients, assuming that private insurers pay more. But
could most radiologists and cardiologists actually earn an adequate livelihood only from privately insured patients? I have my doubts.

Like everyone else, radiologists and cardiologists certainly can claim to be sorely underpaid relative to the extraordinarily high compensation of bankers and corporate executives, which appears to have little correlation with contributions to society. But relative to their colleagues in internal medicine, pediatrics and family practice, radiologists and cardiologists actually are very well paid.

…

So even if Medicare cut fees of radiologists and cardiologists by 21 percent, the income of these specialists would still exceed that of their colleagues in primary care by 60 percent or more.

…

The only question then is whether such fee increases [for primary care] will come at the expense of taxpayers or from other parts of the health care sector, perhaps even the more highly paid medical specialties, including radiology and cardiology. That is a political call.

Reading through just a few of the comments revealed this gem:

As someone who is training to be a radiologist, I have mixed feelings about what you’re saying. While you are correct that Radiologists and Cardiologists do make more than primary care physicians, there is also a reason for that. Specifically, it is that when primary care physicians can’t figure something out, who do they turn to? SPECIALISTS. We train for MUCH longer than primary care docs (often times greater than twice as long) and this is the reason that we are paid more per RVU. We also have more responsibility; in fact, the levels of responsibility are worlds apart. While a primary care doctor can always turn to a specialist for help, we have no one to turn to… The buck stops with us, we are the final authority.

Wow. Sounds like our friend suffering amongst us “less skilled physicians” from last year.

Subsequently, CATHERINE RAMPELL cracked open the Congressional Research Service’s analysis of the OECD database to find out “How Much Do Doctors in Other Countries Make?”

As a country’s wealth rises, so should doctors’ pay. But even accounting for this trend, the United States pays doctors more than its wealth would predict.

According to this model, the 2007 report says, “The U.S. position above the trendline indicates that specialists are paid approximately $50,000 more than would be predicted by the high U.S. GDP. General practitioners are paid roughly $30,000 more than the U.S. GDP would predict, and nurses are paid $8,000 more.”

But it’s important to keep in mind, the report notes, that health care professionals in other O.E.C.D. countries pay much less (if anything) for their medical educations than do their American counterparts. In other words, doctors and nurses in the rest of the industrialized world start their medical careers with much less student loan debt compared to medical graduates in the United States.

Rampell also links to the MGMA report on American physician income, which you may find either eye opening or eye popping.

T.R. Reid: Can We Really Fix U.S. Health Care?

From the Commonwealth Club of California Podcast is here.

Friday, September 18, 2009, 12:34:52 PM

T.R. Reid, Correspondent, The Washington Post; Commentator, National Public Radio; Author, The Healing of America: A Global Quest for Better, Cheaper, and Fairer Health Care

For 100 years, U.S. presidents have unsuccessfully strived to provide universal health coverage. When LBJ created Medicare in 1965, he thought the program would gradually be extended – to people over 60, then 55, then 45, etc., so that everybody would have government health insurance by 2000. Decades later, the Clinton plan failed. George W. Bush created Medicare Part D. Barack Obama says we have the best chance ever this year to fix our health-care system. Is he right? Reid weighs in and reveals what we can learn from health-care models across the globe.

This program was recorded in front of a live audience at The Commonwealth Club in San Francisco on September 14, 2009.

A very good listen. Excellent tid bits about health promotion in Britain, insights into the minds of Canadians and more!

The Health Care System Under French National Health Insurance: Lessons for Health Reform in the United States — Rodwin 93 (1): 31 — American Journal of Public Health

The Health Care System Under French National Health Insurance: Lessons for Health Reform in the United States — Rodwin 93 (1): 31 — American Journal of Public Health:

Keepin’ it real. Every system comes with trade-offs…

THE FRENCH HEALTH CARE system has achieved sudden notoriety since it was ranked No. 1 by the World Health Organization in 2000.1 Although the methodology used by this assessment has been criticized in the Journal and elsewhere,2–5 indicators of overall satisfaction and health status support the view that France’s health care system, while not the best according to these criteria, is impressive and deserves attention by anyone interested in rekindling health care reform in the United States (Table 1). French politicians have defended their health system as an ideal synthesis of solidarity and liberalism (a term understood in much of Europe to mean market-based economic systems), lying between Britain’s ‘nationalized’ health service, where there is too much rationing, and the United States’ ‘competitive’ system, where too many people have no health insurance. This view, however, is tempered by more sober analysts who argue that excessive centralization of decisionmaking and chronic deficits incurred by French national health insurance (NHI) require significant reform.

The Most Outrageous U.S. Lies About Global Healthcare | Foreign Policy

The Most Outrageous U.S. Lies About Global Healthcare Foreign Policy

As the U.S. Congress this summer holds its first serious health-care reform debate since the Clinton era, the resulting public furor has featured increasingly overheated claims about everything from so-called “death panels” to the supposed prowess of America’s homegrown medicine. Many of the most wildly inaccurate statements have been directed abroad — sometimes at the United States’ closest allies, such as Britain and Canada, and often at the best health-care systems in the world.

The lies rebutted include:

1. Stephen Hawking and Ted Kennedy would be doomed outside the US.
2. Canadians come to the US for urgent care.
3. All European health care systems are single payer.
4. Canada and Britain restrict health care choices.
5. The US has The Best Healthcare In The World. (TM)

TR Reid Busts International Health Care Myths

This was in my Pittsburgh Post-Gazette, but also in other papers as well. TR Reid, of PBS “Sick Around the World” has done the leg work and homework to become perhaps the most knowledgable journalist in the world on internation health care.

As Americans search for the cure to what ails our health-care system, we’ve overlooked an invaluable source of ideas and solutions: the rest of the world. All the other industrialized democracies have faced problems like ours, yet they’ve found ways to cover everybody — and still spend far less than we do.

I’ve traveled the world from Oslo to Osaka to see how other developed democracies provide health care. Instead of dismissing these models as ‘socialist,’ we could adapt their solutions to fix our problems. To do that, we first have to dispel a few myths about health care abroad:

Myth 1: It’s all socialized medicine out there.
Not so.

Read on about myths 2-5:

MYTH 2: Overseas, care is rationed through limited choices or long lines.
MYTH 3: Foreign health-care systems are inefficient, bloated bureaucracies.
MYTH 4: Cost controls stifle innovation.
MYTH 5: Health insurance has to be cruel.

What do other countries do? – Kansas City Star

What do other countries do? – Kansas City Star:

“In Britain, famously, they wait.

“To replace a hip, for instance, means months before surgery.

“Spaniards and Italians have single-payer health care systems, but they leave it to the cities and villages, not the capitals, to run things. The Greeks demand all medical bills be covered by universal insurance, but let doctors hit up patients for more.

“The Swiss are required to buy health insurance, and virtually all do.
Health care systems around the world vary like cuisine, reflecting customs and history. Some ingredients travel better than others.”

Bravo to writer Scott Canon of the KC Star for doing a piece on international health care systems.

I quibble with some of it, particularly the first line, and wrote Canon about it:

Thanks, Mr. Canon for your piece “A Universal Pain”, which appeared in my Pittsburgh Post-Gazette today. This kind of reporting is in very short supply and should be front and center in our ongoing discussions on health care, not relegated to the disparaging remarks hurled at Canada by conservatives.

But, I am curious about where you got some of your information. Some seems more up to date than mine, and some less so.

The most glaring one is in the first paragraph regarding waiting times in the UK. Here is more recent news:
http://cmhmd.blogspot.com/2009/05/exclusive-nhs-hospital-waiting-times.html

Further, there are countries with universal health care unlike us, but without significant waiting times, and with better quality outcomes than our own (and I know you praised Germany’s system, which is my favorite model):
http://cmhmd.blogspot.com/2009/05/oecd-waiting-times-study-executive.html

A final point, although health care is pushing budgets to the brink internationally, it is very important to remind the public that increasing expenditure from 8 or 9 or 10% of GDP by one or two percent, compared to our 17 or 18 or 19% in our system is a big difference.

Snapshots: Health Care Spending in the United States and OECD Countries – Kaiser Family Foundation

Snapshots: Health Care Spending in the United States and OECD Countries – Kaiser Family Foundation:

“Health spending is rising faster than incomes in most developed countries, which raises questions about how these countries will pay for future health care needs. The issue may be particularly acute in the United States, which not only spends much more per capita on health care than any other country, but which also has had one of the fastest growth rates in health spending among developed countries. Despite this higher level of spending, the United States does not achieve better outcomes on many important health measures. This paper uses information from the Organisation for Economic Co-operation and Development (OECD)1 to compare the level and growth rate of health care spending in the United States with other OECD countries. In an increasingly competitive international economy, policymakers in the United States will need to be aware of how the health spending and spending growth in the United States compares to that of other nations.”