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Home→Economic policy→You have to pass the bill…Part 23.

You have to pass the bill…Part 23.

The Gormogons Posted on by

Typically Dr. J. gives his gentle readers one required reading assignment in a post, but serendipitously there were two articles today worth reading regarding everybody’s favorite campaign issue, Obamacare, also known as the albatross around the neck of the economy.

The first comes from National Review Online writer Avik Roy, who also happens to be Mitt Romney’s healthcare campaign advisor. 
He writes describing about the inadequacies of Medicaid, and how it harms the poor that it tries to help.  Patients end up waiting longer for care then the uninsured because they are moved slowly through the process that they get sicker than the uninsured individual who picked a more intermediate threshold to show up in the ER for care. His thesis is that doctors are so underpaid by medicaid that they are loath to take on too many medicaid patients, as it would affect their bottom line, they would go out of business, and they would be unable to help the medicaid patients they are already caring for. For details on payor mixes, and how they affect keeping your doctor’s office open, click here.
He goes on to add Obamacare, because it guts Medicare to the tune of $700 billion dollars, will put the elderly in the same boat as the poor. Their reimbursement rates will be worse than Medicaid. Mr. Roy speculates that the elderly will enjoy the same outcomes as the Medicaid population. He adds that by being one size fits all, it makes insurance more expensive for everybody, especially the poor.

In other words, the people who are struggling the most to gain economic and health security are the ones who will be most harmed by the law. Some will be signed up for Medicaid and consigned to a lifetime of poor health care. Some will gain access to the subsidized exchanges, but will find it harder to gain employment as a result. And those who already have insurance, and are being squeezed by ever-increasing premiums, will be squeezed even harder by the law’s thoughtless blizzard of mandates and regulations.

In two pages, he demolishes Obamacare and explains why it is germaine to our economic future. 
The next article comes from Fox News and is near and dear to Dr. J.’s heart. Obamacare has set its eyes on fining hospitals with high 30-day readmission rates for Medicare patients with COPD, heart attacks, congestive heart failure and a couple of other common diagnoses. Hospitals with high readmission rates will be fined for their performance by Medicare (Big Guv’mint wants its money back).

 For at least the last decade or so, hospitals are largely paid for a diagnosis (DRG), so if you are admitted with a heart attack, the hospital gets paid x amount of dollars. If it is a complicated heart attack, more can be billed, but Medicare is billed for a diagnosis. The benchmark readmission rate in a region might be 19%, so a hospital with a rate of 23% could end up being considered the worst in the region with regard to readmission rates. And readmission rates means to ANY hospital, not just your own, and for any reason.

This is a big deal because great hospitals such as Mass. General, University of Chicago, and Vanderbilt will be hit with penalties. Part of this is because of coding and charting, some of it is because these hospitals do more than their fair share helping the poor and socioeconomically deprived, and because they are tertiary care referral centers who undercode the sickest of the sick. They also have patients that live far away  that making sure these patients gets quick and timely follow up with a doctor (especially one near them outside of the system is tricky. CMS evaluates this on a 3 year running average, so it will make it harder for these great hospitals to dig themselves out of their readmission hole. These hospitals will be paying fines until at least 2014, or 2015.

Furthermore, as hospitals are paid by the diagnosis, rather than services rendered, there is a pressure to discharge patients quickly to open up beds for sick patients waiting for those beds. This hurrying up to discharge makes it challenging for the patients to have the education they need, and to be assured they have the support they need at discharge. Add to it that residents have to be done rounds post call and go home handing off their work, rather than staying until the work is done, and that adds an additional layer of trouble.

In other words, length of stay will necessarily increase in order to insure that the high risk patients for readmission will be better teed up for discharge to avoid a readmission, and what the hospital previously faced as a penalty for readmissions will be transformed to an opportunity cost of less billable days in the hospital. This will make it harder for hospitals to stay open and deliver effective care to patients.

There is an additional paradox to all of this:

“Among patients with heart failure, hospitals that have higher readmission rates actually have lower mortality rates,” said Sunil Kripalani, MD, a professor with Vanderbilt University Medical Center who studies hospital readmissions. “So, which would we rather have — a hospital readmission or a death?”

This statistic is largely because patients with higher readmission rates for heart failure, though challenging, have closer follow up, and hospitalizations occur more frequently to cut problems off at the pass to avoid emergencies.

The patients that have poorer follow up either die at home or come in in cardiogenic shock outside the 30 day window and have a grimmer prognosis.

Either way, Obamacare may not cause cancer like Bain Capital does, but it will people. Just thought we’d share that with y’all.  

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