Please excuse me if this is an inappropriate post to this newsgroup. I'm
an internet newbie. I'm still looking for other newsgroups and would
appreciate any suggestions.

Today's Newsday (Long Island, NY newspaper) has an article by Dr.
Salvatore Caravella: "Health Care: Let Doctors Do the Driving." He is the
president of MDLI Healthcare, a Long Island doctor-run managed-care plan.
A typical paragraph:
The hallmark of these plans is their ability to return a higher percentage
of premium dollars to health care, rather than administration.  For
example, a physician-run plan in the Mohawk Valley upstate spends an
average of 90 cents on every dollar it takes in on patient care.  Compare
that to some of the huge HMO's, which spend a mere 70 cents, with the
balance going to executive salaries profits and other exorbitant overhead
expenses.
Where do I sign up?
--
Thank you.
Russ Weber

=Please excuse me if this is an inappropriate post to this newsgroup. I'm
=an internet newbie. I'm still looking for other newsgroups and would
=appreciate any suggestions.
=
=Today's Newsday (Long Island, NY newspaper) has an article by Dr.
=Salvatore Caravella: "Health Care: Let Doctors Do the Driving." He is the
=president of MDLI Healthcare, a Long Island doctor-run managed-care plan.
=A typical paragraph:
=The hallmark of these plans is their ability to return a higher percentage
=of premium dollars to health care, rather than administration.  For
=example, a physician-run plan in the Mohawk Valley upstate spends an
=average of 90 cents on every dollar it takes in on patient care.  Compare
=that to some of the huge HMO's, which spend a mere 70 cents, with the
=balance going to executive salaries profits and other exorbitant overhead
=expenses.
=Where do I sign up?

Er, before you sign up, you might want somewhat more details on the situation.
Have you considered the fact that "$x on patient care" is, to a large extent,
"$x in doctor's salaries"?  The mere fact that one plan spends more on
"patient care" than another does *NOT* necessarily mean that its patients
actually get more care.  The difference COULD (and you haven't presented any
evidence that it's not) simply be that in a doctor-run managed-care plan, the
salaries of the administrators, since the administrators are doctors, are
accounted for as "dollars spent on patient care," whereas in other plans,
they're a separate accounting item.
---------------------------------------------------------------------------
I  try  very  hard  to say exactly what I mean.  I'd appreciate it if you'd
bear that in mind and not try to "interpret"  my  posts  to  fit  your  own
preconceived notions if I'm posting in a serious thread.  Remember:  If you
throw a strawman into a heated debate, flames are likely to be the result.

Er, before you sign up, you might want somewhat more details on the
situation.
Have you considered the fact that "$x on patient care" is, to a large
extent,
"$x in doctor's salaries"?

REPLY:  Very appropriate.  As a physician in practice for 22 years without
mannaged care, and one who has educated his children and lives a very
frugal lifestyle,  there  WILL  be a problem when the care program sets
the physician salary by how little he does.  Look at Canada and even New
England in the USA.
The management of Acute M.I.  is done with "less resources" in these areas
because of many things.  One of them is the incentive to use LESS  care
for patients.  Note that correct care of a heart attack is not just one
plan.  There are several plans which all may be correct and ACCEPTABLE.
There is usually one which is clearly better.  That may be the most
expensive (balloon, for example) and you can BET  that in a managed care
environment that will be watched.  
    We are right now being "tracked" individually to see how we treat
heart attacks, heart failure, etc.  The insurance companies and managed
care plans will move toward the doctors with the least utilization of
expensive treatment.  THIS IS NOT GOOD FOR YOU.  
    It is amazing how easy it seems for the insurance company to try to
deny care to patients who will die earlier with substandard treatment.
Note the SAME  thing will happen in a doctor run orginization where there
are "X" number dollars and the less treatment, the more left to
distribute.  This is human nature, and cannot be hidden.  Even though we
would individually try to prevent it,  the GROUP  would meet and go over
financial data, and then point out individual doctors who exceeded a
certain spending limit.  If we fight the system, we get replaced.
     signed,   XXXXXX, M.D.

I agree, but would even take it further.  The single payer system goes
further in isolating docs from financial considerations.  Although cost
effectiveness has a role, deciding solely on cost as HMO's do (though
they always deny it) is WRONG.  As a Cardiologist, I would love to see
such a system take hold.

//--------------------------------------------------------------------
// Matt DeCaro

=Er, before you sign up, you might want somewhat more details on the
=situation.
=Have you considered the fact that "$x on patient care" is, to a large
=extent,
="$x in doctor's salaries"?
=
=REPLY:  Very appropriate.  As a physician in practice for 22 years without
=mannaged care, and one who has educated his children and lives a very
=frugal lifestyle,  there  WILL  be a problem when the care program sets
=the physician salary by how little he does.  Look at Canada and even New
=England in the USA.

It would appear that you missed my point:  If you have a physician-run
managed-care program, then what would, in a non-physician-run managed care
program be "administrative salaries" will now be part of "physicians'
salaries."  And, if your accounting setup is such that all of "physicians'
salaries" counts as "patient care," then the physician-run maanged-care program
will have a higher percentage of its income going to "patient care," even
though the amount of actual patient care could be the same in both cases.
The sort of statistics cited are meaningless without a detailed knowledge of
the accounting methods used to derive them.

=    We are right now being "tracked" individually to see how we treat
=heart attacks, heart failure, etc.  The insurance companies and managed
=care plans will move toward the doctors with the least utilization of
=expensive treatment.  THIS IS NOT GOOD FOR YOU.

On the other hand, having a program in which each doctor orders every test
having anything remotely to do with your symptoms that's available, rather than
selectively ordering tests until the problem is tracked down isn't necessarily
good for you either.  If nothing else, doing so raises the premiums that your
insurance company must charge.

=    It is amazing how easy it seems for the insurance company to try to
=deny care to patients who will die earlier with substandard treatment.
=Note the SAME  thing will happen in a doctor run orginization where there
=are "X" number dollars and the less treatment, the more left to
=distribute.

True, though that wasn't the point I was trying to make.
---------------------------------------------------------------------------
I  try  very  hard  to say exactly what I mean.  I'd appreciate it if you'd
bear that in mind and not try to "interpret"  my  posts  to  fit  your  own
preconceived notions if I'm posting in a serious thread.  Remember:  If you
throw a strawman into a heated debate, flames are likely to be the result.

  Though I agree that a doctor run HMO is a better alternative to
curent HMO systems, I believe a superior health care system can
be established through a patient run system...

  The patients will want maximum treatment and will insist on a fair
price....

   The problem with a physician run system is that we have already seen
that many doctors will sacrifice the care of the patients in order to
make an extra buck via their HMO....

   The fact that they joined an HMO and agreed to the terms is in direcct
contradiction to what is best for the patient....

    I have an HMO physician's guide book in front of me now...

    The method physicians are judged by is how care is limited..

this is how physicians are primarily judged for payment by this
particular HMO...

    Focused chart findings, adherence to managed care philosophy (keep
the referrals low, in other words), hospital services, specialty
services,  and emergency department services (isn't this redundant)

   I'm appalled anyone could agree to their criteria for treating
patients....

      It's time we put those companies out of business and
established asystem which really cares for the patients needs!!

         JB

=  Though I agree that a doctor run HMO is a better alternative to
=curent HMO systems, I believe a superior health care system can
=be established through a patient run system...
=
=  The patients will want maximum treatment and will insist on a fair
=price....
=
=
=   The problem with a physician run system is that we have already seen
=that many doctors will sacrifice the care of the patients in order to
=make an extra buck via their HMO....

And the problem with a patient-run system is that the patients often don't know
enough about medicine to make informed decisions.  For example, there was the
fellow who recently posted to this newsgroup inquiring about getting an
angiogram because his father'd died of a heart attack.
---------------------------------------------------------------------------
I  try  very  hard  to say exactly what I mean.  I'd appreciate it if you'd
bear that in mind and not try to "interpret"  my  posts  to  fit  your  own
preconceived notions if I'm posting in a serious thread.  Remember:  If you
throw a strawman into a heated debate, flames are likely to be the result.

    This editorial from the December 21 issue of the New
    England Journal of medicine is very relevant to this
    discussion.  I have a few excerpts from the editorial.
    Please read the full article.  It is a scary but true
    Prophecy of things to come in medicine as the for profit
    organizations aim to increae their profits and stock value.
    Doctors are but mere lackeys of the corporate structure.  

    --------------------------------------------------------

    Our own contracts with one health maintenance or-
    ganization (HMO) state: "Physician shall agree not to
    take any action or make any communication which un-
    dermines or could undermine the confidence of enroll-
    ees, or the public in the HMO" and "Physician shall keep
    the Proprietary Information [payment rates, utilization-
    review procedures, etc.] and this Agreement strictly
    confidential."

      This 2.4 million-member plan spends only 74.4 per-
    cent of its revenues on medical care; $1 million a day
    goes to profits, adding to its $1.2-billion cash reserve
    Its chief executive officer pocketed $20 million in a sin-
    gle year and holds $534 million in company stock.

     One secret to this success is a payment formula that
    binds primary care physicians' interests to the firm's.
    The base capitation payment barely covers office over-
    head.  An internist with 1500 of the plan's patients might
    take home more than $150,000 from bonuses and in-
    centives, or nearly nothing.  ... most (bonuses) reward limiting
    care and boosting the HMO's image and enrollment.
    For instance, for each dollar of emergency care, the
    plan penalizes the doctor up to 50 cents.

    Why these changes?  In a nutshell, previous managed-
    care arrangements did not sufficiently squeeze care or
    expand profits.

       Enter plans that tie doctors' incomes to curtailing
     service.  These plans shift the risk, the cost of office fa-
     cilities, and malpractice liability to the doctors - either
     individually (as in the case of U.S. Healthcare) or by
     means of subcontracts with large groups of physicians.
     At first blush, these new arrangements seem attractive.

      But the financial incentives for physicians are prob-
     lematic.  The new risk-sharing arrangements are not
     simply the inverse of fee for service.  Instead, they are
     the inverse of fee splitting. just as fee splitting allows
     doctors paid on a fee-for-service basis to profit from
     referring patients, so doctors under the new arrange-
     ments can profit from not referring patients.
                ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

     The public's dim view of fee-for-service physicians
     who benefit from their power to refer surfaced in "anti-
     kickback" statutes.  These laws ban paying doctors for
     care they prescribe but do not themselves deliver.  Risk
     sharing   what might be called fee-for-nonreferral
     care - is the mirror image and ethical equivalent of
     these banned practices.  In both instances, secrecy in-
     creases the ethical taint.

    We can already glimpse the next phase.  As fee-for-
    service medicine withers, risk selection by HMOs will
    become a zero-sum game, presaging fierce competition
    among doctors to avoid sick patients.  Already the chief
    of a university hospital reportedly has admonished facul-
    ty: "[We can] no longer tolerate patients with complex
    and expensive-to-treat conditions being encouraged to
    transfer to our group." Doctors who attract sick pa-
    tients ....risk being ostracized from
    plans and even physician groups.  The gulf between clin-
    ical excellence and professional success will widen.

      Might risk-assuming arrangements shield us from di-
    rect corporate pressures and hold at bay managers with-
    out the clinical and social sensibilities of physicians?
    Not likely.  Doctor-managers use the same utilization
    controls as other managers; 61 percent of physician
    groups do not adjust for case mix, or even for patients'
    age, when profiling doctors' costs, thus implicitly en-
    couraging risk selection.

   If 5000 physicians, roughly the number needed to care
   for U.S. Healthcare's patients, invested $100,000 each,
   thcir $500-million stake could not rival that HMO's
   cash on hand, much less the amount in the far deeper
   pockets of Prudential or United HealthCare.  Capital is
   essential to build the regionwide networks demanded
   by large employers and for research and marketing to
   identify and enroll the healthy.  The biggest players can
   extract the best deals from hospitals, laboratories, and
   suppliers and can withstand huge early losses, a cush-
   ion that allows predatory pricing to drive out compet-
   itors.
    The recent marriage of profit making and managed
   care portends momentous changes in medicine.  Virtual-
   ly all sound research on the quality of care provided by
   HMOs has assessed plans with salaried physicians, most
   of them nonprofit, that are now being eclipsed. Only 55 per-
   cent of the plans owned by insurance firms responded to
   the benign survey of Gold et at. despite its sponsorship
   by a congressional commission and endor{*filter*}ts by
   trade associations.  Such firms increasingly own the raw
   data, including even patients' charts, needed for evalua-
   tion.  Will they allow access to potentially damning infor-
   mation?  Insurers' large investments in tobacco-company
   stock give little evidence of social conscience.
     It is hard to be a good doctor.  The ways we are paid
   often distort our clinical and m{*filter*}judgment and sel-
   dom improve it.  Extreme financial incentives invite ex-
   treme distortions.  Yet financial incentives are not nec-
   essary for cost control and are expensive to administer.
   A single-payer system like Canada's limits entrepre-
   neurial rewards and penalties, covers everyone, and
   saves much on bureaucracy and profits.  The public
   budgetary ceilings that constrain costs bring doctors
   and patients into conflict with budget setters (and tax-
   payers), but not with each other.  Salaried practice in
   nonprofit, community-controlled regional plans might
   achieve even better results.
      Until such reforms are carried out, many physicians
   scrambling to preserve their careers will be tempted or
   forced into the corporate embrace.  But if we shun the
   sick or withhold information to benefit ourselves, we con-
   spire in the demise of our profession.  Let us not end up
   like tobacco-company executives, who, repenting their
   sins, find that their contracts forbid confessing them.

  STEFFIE WOOLHANDLER, M.D., M.P.H.
  DAVID U. HIMMELSTEIN, M.D.