A Tipping Point with Ominous Implications is Fast Approaching!

Note to the reader: This article is an updated version of one that was posted shortly after my blog “Education, Hope, and the American Dream” was created and at a time when the blog’s readership was minimal.
Because I believe it is even more timely now than it was then, it is being re-posted with modifications.

As you read these words, it is vital that you realize that the United States of America, the richest and most powerful nation in the world, is fast approaching a tipping point that will irrevocably alter the reality in which we live.

As a result of decisions we have made as a nation, since the end of World War II, a society of second class citizens has emerged. These Americans are not full participants in the American dream. Many of these men and women have effectively become disenfranchised and why should we be surprised by this.

These are Americans who have not been well-served by our systems of public education; have little or no access to quality healthcare for their families, Obamacare notwithstanding; and, if they are employed at all, they have low paying jobs with no eligibility for healthcare benefits and no opportunities for advancement. These are Americans who have given up on the American Dream for themselves and their families. They have succumbed to a self-perpetuating cycle of powerlessness and hopelessness.

Although the demographics of this group spans the full spectrum of the American population, African-American, Hispanic-American and other minorities are over-represented. For blacks and other minorities, the sense of disenfranchisement is compounded by their lack of faith that the American justice system will treat them justly.

Mainstream Americans resent the dependency of this segment of our population every bit as much as these men, women, and children resent their lack of access to the American Dream. For a huge portion of this population the American Dream is nothing more than a failed promise.

The bitterness and resentment on both sides of the invisible barriers that separate us as a people are enhanced by the racism and discrimination that permeate our society. How ironic is it that the election of our nation’s first African-American president has proven that racism in America is alive and well.

That there is an equally large and fast-growing population of retirees who are checking out of the game at an age from which they are likely to live another quarter of a century, adds greatly to this burden. It does not matter that these retiring men and women have worked hard for their entire lives to earn their Social Security, Medicare and pensions. These facts do not change the economic dynamics that make this population a burden to the Americans in the middle who must work harder to pay the bills.

Fortunately, many of these men and women have invested well and their money is working for us even if they are not. We are only beginning to understand, however, how this aging population will begin to overwhelm an already inadequate healthcare system over the next two decades.

Add the weight of the disenfranchised and the burden is fast approaching a tipping point after which our national misfortune will accelerate and we will all begin to feel both hopeless and powerless.

The Republican Party, driven by the strong conservative dogma of the tea party movement, is choosing to ignore the needs of Mitt Romney’s imfamous “47 percent” and focus only on the needs of the middle class and, even more so, the corporate elite. These political leaders believe they can turn back the clock to a time when the white man ruled the roost and when values seemed clearer.

The Democratic Party continues to pursue its traditional liberal agenda that has become equally ineffectual.

In the meantime, China, Europe, Japan, India, and other developing nations are challenging our supremacy in the international marketplace; Al Qaeda and ISIS are seeking to spread terror to weaken “the evil empire;” and, Mother Nature is meting out the consequences of global warning.

We cannot continue to trudge down the dry and dusty paths of 20th Century political dogma, conventional wisdom, or business as usual. Somehow we must pull the disenfranchised back into the game as full and equal citizens, as believers in the American dream, and as partners in rising to the challenges of this new century. We need to do this not out of altruism, however compelling the argument, rather because we desperately need the committed participation of every single able-bodied American.

We must demand that our elected representatives cease their paralyzing bickering and begin working together in what is a conflict of historical proportions in which the very survival of our nation and way of life are at an unprecedented level risk.

We desperately need new leadership with fresh ideas to respond to these extraordinary challenges of this young Twenty-First Century and we do not have so much as a single nanosecond to spare.

I invite you to follow this blog, “Education, Hope, and the American Dream,” in which I offer innovative solutions to the problems we face as a society.

I also invite you to read my four books.

1. The Difference Is You: Power Through Positive Leadership, in which I offer the reader powerful principles that enable individual men and women to change the world around them;

2. Radical Surgery: Reconstructing the American Health Care System, that offers a way to provide universal healthcare and prescription drugs to the American people without socialized medicine;

3. Reinventing Education, Hope, and the American Dream: The Challenge for Twenty-First Century America, in which I offer a blueprint for reinventing the educational process to one that focuses on teachers and students working toward success, absent the risk of failure; and

4. Light and Transient Causes, a novel that tells a story of what could happen if we lose faith in the principles of democracy and with one another.

The Wide Disparity of Pricing for Healthcare Services is Just a Taste of the Problems Yet to Come

This past week, ABC News reported on the practice of the Northside Hospital System in Atlanta of charging outrageous prices for their services. They cited the bill of one patient where they did a line by line analysis of charges. What they found were many examples of line items for which the patient was charged exorbitant prices for things that the hospital could purchase through its suppliers for a tiny fraction of the cost. One of the most glaring examples was a pill for which the patient was charged several hundred dollars in spite of the fact that the hospital could purchase it for less than a nickel.

Hospitals across the country engage in such pricing strategies, to one degree or another, in order to make up for losses as a result of low reimbursement rates by health insurance, managed care companies, Medicare, and Medicaid and also as the result of the cost of doing business in a dysfunctional system.

This practice is considered a strategy of necessity by providers of many healthcare services simply because that is the way the fee-for-service, zero-sum billing game has evolved. Payers establish reimbursement rates that enable them to stay in business, which means making a profit. And, do not be confused by hospitals that claim to be not-for-profit for even these providers must be able make money if they want to stay in business. The only differences are the uses of the profits and the bank accounts into which the dollars must inevitably be deposited.

Every billable medical or hospital procedure results in high-stakes competition to determine where those dollars will end up. Health insurance, managed care companies and other payers set reimbursement rates and also make providers jump through hoops as part of the claims processing strategy to look for any reason to justify denial of the claim. This forces providers to develop coding and billing strategies to optimize their revenue generation and also requires them to file and refile claims. It is a zero-sum game in which there are winners and losers in the competition for each and every healthcare dollar, not counting the patients who almost always are losers in the billing game.

What charges are not reimbursed by the various third-party payers are then billed to patients. Some of the money is eventually collected and much of it must be written off. Families burdened by outrageous medical and hospital bills is the single greatest cause for most of our nation’s personal bankruptcies. The write-offs necessitate new and more innovative charging and billing strategies. It is a vicious circle that drives up the cost of care enormously. Although we have seen some improvement, in recent years, in the rate of increase of aggregate healthcare costs, for at least two full generation the rates of increase have been substantially higher than the Consumer Price Index (CPI). There have been many years when the rate of increase has been double- or triple the rate of the CPI. Higher costs require providers to increase prices, which requires insurers to increase premiums on a merry-go-round that is anything but merry to the patients.

When we think about the number of healthcare dollars that never end up in the hands of providers of actual medical, hospital, or ancillary care, it can be a staggering amount. The insurance, managed care, and government payers always underestimate the percentage of dollars that are allocated to the administration process relative to those spent on direct care to patients. That cost is not just the cost of doing business for the private and public payers (which for the private payers must include profits) it also includes every dollar spent by providers for the purpose of coding, billing, claims processing, and management of receivables.

It truly is an outrageous process but it is the inevitable companion to the practice of fee-for-service (FFS) medicine in a market driven by health insurers and other third-party payers and processors.

The process is so complex that, in spite of claims on the part of health insurance and managed companies to the contrary, there is no accountability. Incompetent and inefficient providers pay no penalty for their poor performance and both the best and the worst providers survive no matter what the level of patient satisfaction.

Free market forces, in the true sense of the concept simply do not function in healthcare.

The biggest problems in healthcare in America, whether speaking of quality, cost, or access are the inevitable outcomes of a system driven by health insurance, Managed, care and other third-party providers; both public or private.

That Obamacare or, more correctly, the Affordable Care Act, (or more appropriately the Affordable Health Insurance Act) commits us to a health-insurance driven market is a recipe for continuing and escalating disaster. The motivation of Obama and the members of congress who finally chose to act was admirable if misguided. We have tried to fix a system driven by forces that even our smartest people seem unable to comprehend with a solution that can only aggravate an already tragic reality.

It is, truly, a national embarrassment that so many citizens of what we consider to be the richest and most powerful nation in the history of the world must deal with illness and injury of themselves and their families without access to what we also describe as the highest quality healthcare on the planet.

What makes the situation most ludicrous is that it is our stubbornness and our prejudices that keep us from embracing a solution that will provide comprehensive healthcare and prescription drugs to every single American man, woman, and child, without relying on socialized medicine, at a cost that will save the American people trillions of dollars.

My book, Radical Surgery: Reconstructing the American Health Care System, lays out a healthcare plan that will give us everything we need, at a reasonable cost, without any of the things that the American people seem to fear, pathologically.

Don’t believe me? Check it out!

ObamaCare Approval Rating Continues to Fall

Over the last few months there have seen and heard numerous reports that the public’s approval rating for ObamaCare, more appropriately referred to as the Affordable Care Act, has been falling steadily and now rests well below forty percent.

This should come as no surprise. Attempting to fix the American healthcare system by relying on the health insurance industry is like trying to fix Congress by making it easier for people to get re-elected.

The best we can say about the Affordable Care Act is that it was a nice try but one that was doomed to fail because its design was driven more by political considerations than by an understanding of how the healthcare system actually works. All ObamaCare really accomplished was to add another layer of complexity to a system that was already unimaginably complicated.

Until we are ready to acknowledge that health insurance is one of the biggest reasons why our healthcare system fails and, of course, that human beings actually deserve medical care when they are ill or injured, our tinkering with the healthcare system will only make it worse.
Focus on health insurance, if you will. Imagine for just a moment that we all could agree that there ought to be a way to see that all men, women, and children have access to health care when they need it.

Now, think about what health insurance actually does. The health insurance industry restricts access to care to only those people who are covered by a health insurance policy and it limits care to only those services that are specifically covered by that policy.
Assuming, again, that we want everyone to have access to healthcare, why would we be willing to pay the health insurance industry hundreds of billions of dollars to restrict care to a special few individuals and to limit care to only services that have been specifically identified?

And, yes, I’ve heard the argument that we over-estimate the amount of money siphoned off by the health insurance industry. Just the opposite is true. We grossly underestimate the degree to which the health insurance industry contributes to the rising cost of healthcare. The cost of health insurance is not just the result of that portion of our premium dollars that are retained by the health insurance industry after payment of claims to providers.

The cost of health insurance also includes every dollar that is spent by doctors, hospitals, nursing homes, out-patient surgery centers, rehab facilities, lab and imaging centers, home health care providers, and hospice providers to manage the process of filing insurance claims and fighting to get the paid what they are rightly owed.

We could also add the expenditures by employers as they manage the process of selecting health insurance or managed care providers, managing the enrollment process, and mediating grievances when their employees are unfairly reimbursed for care.

And, we could factor in how much the health insurance industry pays to influence legislators. And then, of course, there is Medicare and Medicaid.

If we could recoup every healthcare dollar expended by people like you and me, and also by our employers, that does not end up in the hands of actual providers of care we could afford to provide comprehensive healthcare and prescription drugs to every American man, woman, and child.

And, if you want “to hear the rest of the story,” as Paul Harvey used to say, take a look at my book, Radical Surgery: Reconstructing the American Health Care System Continue reading

Act Now and Save $15 Trillion ($15,000,000,000,000)

Let us forget, for just a moment, the debate about the Affordable Care Act or, as most of us would call it, the Obamacare Act, and focus, instead, on the issue of providing universal healthcare (translated to mean comprehensive healthcare for all American citizens and legal aliens).
No matter how we feel about Obamacare, we certainly would agree that the Affordable Care Act will not provide access to healthcare for every single American. The absolute most the Affordable Care Act will do is to make it easier for more Americans to purchase health insurance coverage. There also seem to be few illusions that Obamacare is going to cost less than what healthcare in America cost before implementation of the Affordable Care Act. Many will suggest that it will, in fact, cost more than what we have spent in years past.
The real question we should be asking, however, is “why are we unable to provide comprehensive healthcare and prescription drugs to every single American Citizen and legal alien?” In other words, why are we unable to provide universal healthcare?
For the moment, I want to forget about all of the altruistic reasons as to why the richest and most powerful nation in the world should have a healthcare system that meets the needs of all Americans, like virtually every other developed nation? I want to forget about these things because no one really seems to care.
We seem more concerned with rejecting the concept of socialized medicine than we care about all of the men, women, and children in the United States who are unable to gain access to and afford the medical care they require.
The fact is that the vast majority of Americans are unable to distinguish between the concepts of universal healthcare and socialized medicine. These to concepts are, in the minds of these people, synonymous. I suggest to you that it is this inability to differentiate the concept of universal healthcare and socialized medicine that is at the root of the entire problems with the American healthcare system.
Since no one seems to care about the suffering that so many Americans are made to endure, let us focus on the one issue about which everyone seems to care and that is the cost of health care in America.
From 2001 through 2011, the total annual healthcare expenditures of the U.S. grew from $1.2 Trillion to $2.8 Trillion. This represents an average increase of 8.8 percent per year. If that trend continues from 2012 to 2022, our annual healthcare expenditures will increase from $2.8 Trillion in 2011 to just under $7.1 Trillion in 2022. For the eleven calendar-year period from the end of 2011 until the end of 2022, we will have spent just under $56 Trillion on healthcare. Mind boggling, is it not?
In 2001, I wrote a book entitled, Radical Surgery: Reconstructing the American Health Care System, in which I proposed a healthcare solution that would provide universal healthcare without socialized medicine. In other words, I wrote that we could provide comprehensive healthcare and prescription drugs to all Americans and legal aliens without relying on government. Let me say it differently in order to alleviate any confusion. I proposed a way in which we could give every American access to whatever healthcare they required but that would involve neither federal nor state government in the healthcare delivery or decision-making process.
One of the features of this new system was a mechanism that would allow us to control the increases in the cost of care so that costs would rise no faster than increases in the Consumer Price Index (CPI). At that time I projected that the CPI would grow at a rate of 5 percent per year. At that rate, I suggested that healthcare expenditures would have risen to $1.86 Trillion by 2010. Had we been able to hold the increase in annual healthcare costs to 5 percent per year we would have saved an aggregate amount of $3 Trillion over the ten year period. Pretty significant savings, wouldn’t you say?
In fact, the actuall CPI growth during that same period was an average of 2.7 percent per year. Had we been able to control the rise in healthcare expenditures to actual inflation rates, costs would have grown only to $1.55 Trillion resulting in an aggregate savings over the decade of just under $4.5 Trillion. Even more impressive, don’t you think.
Now, let us assume that the actual rate of increase in healthcare costs between now and 2022 would remain the same as the previous ten year period (8.8 percent). In that case healthcare costs will rise to a staggering $7.086 Trillion by the end of 2022.
If, however, we were to implement the healthcare proposal presented in Radical Surgery: Reconstructing the American Health Care System, and inflation would continue to increase at the rate of 2.7 percent per year as it did over the last decade, our annual healthcare expenditures would rise to only $3.9 Trillion. Under this scenario, the aggregate saving in healthcare costs over the ten year period from 2013 to 2022, compared with the projected 8.8 percent per year increase, would be $14.9 Trillion dollars.
Forget altruism, just give me the money!
The question for the reader is a simple one. Can the American people afford to spend an extra $15 Trillion over the next decade for a healthcare system that will continue to leave a significant percentage of the American population with inadequate access to healthcare?