Profits To Die For!

The Affordable Care Act, otherwise known as Obamacare, almost died on the vine from a disease known as "mythical-political drivel" by which it never maintained a majority public trust. As the ACA sputters to become implemented, one of the main drawbacks is that in the infinite wisdom of its crafters, significant medical cost reduction, or control, was not (or could not be) ensured in the grand framework. But you have to give the crafters much credit because they achieved a feat that had failed for over half a century --- even though imperfect and notwithstanding the industrial medical complex's money monopoly who actually had the upper hand in its forming.

 

Steven Brill's Bitter Pill: Why Medical Bills Are Killing Us brings to light the medical complex's drawstrings that bids medical cost in an ever-increasing part of the national GDP, now headed toward 20%.  It is the convolutional yoke, in part, strangling our national economy. Brill, the founder of Court TV, seems to pull no punches, squarely putting blame where it falls. (His introductory video to the article should be found at the bottom of first page.)

If you've looked at a hospital bill (hope you haven't had one), did you understand it, all the little high priced itemizations? Being indecipherable, most people instantly glance to the bottom line, the thousands of dollars on the "Total Due" line. Surprised or not, what other things in life can you think of that you buy without knowing beforehand what the cost will be?

Brill, through the documentation of the many real-life medical bill cases he tracked, helps us understand why medical cost is so high and growing. You can quickly grasp the possibility of an estimated 700,000 people in the U. S. becoming medically bankrupted annually, per a study Harvard Law and Harvard Medical School did. You'll learn how MD Anderson Cancer Center, a nonprofit hospital, makes millions of dollars annually with a 26% profit margin, net profits many large corporations envy. And should I say, would be considered profits to die for? And that's after the CEO and top administrators collect salaries in the millions.

Even though hospital administrators lament that they can't make it on Medicare payment schedules, in many cases it is their sustaining revenue. (Even though Brill doesn't give examples of a financially besieged hospital, no doubt there are those smaller communities which hospitals struggle to keep above deficit line. And here is where some of my respected hospital-associated friends might take exception.) Brill says, "By law, Medicare’s payments approximate a hospital’s cost of providing a service, including overhead, equipment and salaries." But hospitals have something called the "Chargemaster," a grossly inflated pricing schedule. It's kind of what some of us in business used to call "premium billing," you pay on time you get significant discount. However, with the Chargemaster schedule --- premium billing takes on a totally different meaning. It's used to exorbitantly price every "little and big item" from your Tylenol pill - to room and the cat-scan equipment rendering your test.

From the Chargemaster schedule, Medicare, Medicaid, and Insured customers get whopping discounts, either by law or in the case of the medically insured their commercial carrier, such as Aetna, negotiates a much lower price. Those caught without medical coverage, a young person dropped from a parents policy, those who can't afford COBRA at loss of employment, those in poverty, or the insured person whose bill runs over limits of coverage, have to deal with the Chargemaster, generally without an advocate to reduce the price. They are left in an insurmountable financial pit, which many times results in bankruptcy.

Another important point Brill makes is that technology and the lack of competitive market forces have not reduced the cost of expensive medical equipment. Comparatively, most all of the technological improvements for such as TVs, computers, and other appliance over the last several years have decreased in price.

Brill, determines that doctors are not the recipient of excessive profits, nor are insurance companies necessarily a part of the problem. He references our local Spanish owned Grifols plant in Clayton, North Carolina, where human plasma is used to make Flebogamma, a sterilized solution that is intended to boost the immune system. He says, "In Spain, as in the rest of the developed world, Grifols’ profit margins on sales are much lower than they are in the U.S., where it can charge much higher prices. Aware of the leverage that drug companies — especially those with unique lifesaving products — have on the market, most developed countries regulate what drugmakers can charge, limiting them to certain profit margins. In fact, the drugmakers’ securities filings repeatedly warn investors of tighter price controls that could threaten their high margins — though not in the U.S."

Brill ends with suggested solutions, such as taxing 75% on the amount over $750,000 that CEOs of nonprofit hospitals make. But he has little hope that the industrial medical complex's economic-debilitating forces have a chance for corrections needed. Now with the ACA Framework in place, our congress has an opportunity to work together to do the right things in amending and tweaking that framework to improve all it merits, including the essential cost control elements. You think they can do that? Yes, I do, but only with the mind's-eye fixed on ethical behavior,  unrestrained of the industrial medical complex's stronghold.

It's a long article, size of a short book, 59 full pages on attached document, but worthy of your time. Read from the Time's link or as attached herewith. (The highlights and border block-offs are all mine.)