Friday, October 8, 2010

Rationing is bad, bad, bad...

(photo courtesy of

Highly successful businessman and founder of Staples, Tom Stemberg, made some interesting comments recently regarding the United States health care system.  The Boston Herald, from which this post is drawn, recently wrote about this here.

According to Mr. Stemberg:
I think we have to confront a very unfortunate reality in this country: We’re doing a tremendous amount of elective surgery on people for whom that election probably is no longer affordable.

If a citizen is 80 years old and wants to have elective surgery, knee surgery to pick an example, because they think an artificial knee will help them walk the golf course better, they should have every right to do it, but they should be paying for it. The national government should not be paying for those kinds of things
We used to have an active and vibrant and moderately successful phenomenon in this country called managed care.  Providers were paid a capitated (usually severity adjusted) monthly payment to take care of an entire covered population's health care needs.  Because additional cost savings could be derived by "carving out" specific categories of care (it all began with mental health services, then pharmacy benefits were next, followed by diagnostics, and then...) and businesses didn't want to restrict (er, ration) care to employees, it all fell apart.  There was a public backlash against managed care as being overly restrictive and perennially penny pinching and so, that phenomenon gave way to a return to fee-for-service health care. 

During the recent health care debate, mere suggestions that empowered governmental (or even private) bodies would review and make recommendations regarding coverage options and treatment protocols raised cries of "rationing" and "death panels" and so many of the most restrictive components of the bill were pared back.  Let's face it: we just don't like rationing... or anything that even remotely smacks of it.

Unfortunately, while the expansion of coverage provisions go into effect right away, health reform legislation has the cost control provisions being phased in over time.  Some provisions call for changes in how providers are paid, setting up quality-based payment mechanisms and new accountable care organizations designed to capture the full and global payment to cover services for a defined population... much as capitation was designed to do in the former system.  As has been discussed here, we'll need to make sure we understand and avoid the pitfalls of the past as we build the next system.

Now back to Mr. Stemberg.  I wonder how his comments cited above will play to a population totally and completely unwilling to entertain any system that even remotely involves rationing.  It could be argued, particularly if you're the 80 year old golfer he mentions but who can't afford a new knee, that a loss of Medicare coverage for said joint replacement surgery is going to feel a lot like rationing... particularly since you can get that knee covered today.

For the health care provider community, which is perceived as being largely inefficient and, in some cases, profoundly greedy, the cost cutting measures of health reform legislation need to be about more than an endless stream of straight reimbursement cuts.  Many of us have driven ourselves hard to become lean and no one would accuse the organization I work for as being greedy.  Just the same though, we're expecting nearly 5 percent cuts each year for the next several.  Those are cuts we know we can't sustain.

No rationing.  Full coverage for everybody.  Unrestricted access to every provider.

It just won't add up.


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