Our Healthcare System Is Hemorrhaging

Patients concerns about access to physicians showed a significant increase according to polls1. Access difficulty is directly related to the overall shortage of doctors in the specialty of Primary Care (Internal Medicine, Family Practice and Pediatrics). As older doctors are retiring, there are few young Primary Physicians coming out of training to replace them. Congress has made a series of bad decisions that is a major contributing factor to this very serious situation that is decreasing the availability of healthcare, reducing access and dramatically adding to healthcare costs.

Instead of choosing Primary Care, physicians in residency training are going into other specialties such as Cardiology, Gastroenterology, Hematology and Pulmonary Disease because these procedure oriented specialties are reimbursed by Medicare at a much higher rate2. In the past, most patients have been treated by Primary Care Physicians (PCP). The PCP served as the “gatekeeper” for hospitalizing patients and referring them to other specialists as need.

The average Primary Care Physician works over 65 hours a week and is available for emergency night call. They pay for their own office space, office help, medical liability insurance, health insurance, have no paid vacations, or paid sick days. They have to fund their own retirement and pay for their own state mandated education programs. With marked increases in medical liability insurance, many Primary Care Physicians found they did not have enough money to put their children through college! As their costs have gone up Medicare, HMOs, and Insurance companies have not raised reimbursements paid to Primary Care Physicians3. In fact, Medicare scheduled the PCP’s for an 10% reduction in payments, but in the final hours Congress deferred it. Unless Congress intervenes again they will be threatened by a 20% reduction in payments in two years time.

Congress’s unrealistic attitude in writing health legislation has resulted in a shortage of Primary Care Physicians making them an endangered species. Some patients now go to specialists who do more tests and procedures with an increased cost to Medicare and the taxpayers. Others, because they can’t find a doctor are forced to go to emergency rooms of hospitals which are even more expensive.

Primary Care Physicians have a 1 in 8 chance of being mentioned as part of a law suit each year! Even though the PCP may only have just evaluated the patient as being in good health for surgery and had nothing to do with the surgical procedure and if the patient acquired a wound Infection after surgery, the primary care physician may be included with the surgeon in the law suit. This is because trial lawyers can use the doctrine of “joint-and-several liability” when they are looking for another “deep pocket”.

If they settle the case the Primary Care Physician can be hit by increased insurance liability rates. If he has a few cases like this, he can lose his medical liability insurance. This policy punishes the innocent and has to be changed as a part of tort reform.

Because of the constant threat of lawsuits, doctors are forced to practice “defensive” medicine and order many tests and procedures than he would not ordinarily have ordered to evaluate the patient’s condition. This significantly drives up the cost of healthcare and makes buying healthcare insurance much more expensive. There is a point when healthcare gets so expensive that segments of the population decide to take a chance on living without healthcare insurance because they are not currently sick. This has contributed to the estimated 40 million Americans going without health insurance.

If the doctor is named in a law suit the trial lawyer looks for some test that he can find that was not ordered and tries to tell a medically unsophisticated jury that not getting that test contributed to negligence on the part of the doctor. The trial lawyer never asks why the doctor is ordering so many tests or is concerned about how much it costs.

This explains one of the major reasons medical costs are much higher in the United States than anywhere in the world. No other country has an aggressive trial lawyer system which costs taxpayers hundreds of billions each year in increased costs. A number of American trial lawyers reportedly have become billionaires!

The Pacific Research Institute (a not for profit, nonpartisan organization supported by contributions) is the first to do a detailed study quantifying the total cost of tort litigation in our country. They have calculated that the excessive tort costs in the United State due to lawsuit abuse totals $589 billion each year4.

The average person, not involved in any lawsuits pays for lawsuit abuse in many ways, reduced access to healthcare, much higher health insurance premiums and increased Medicare costs. The medicine you take costs much more and some potentially lifesaving medications are not even being developed because the cost of drug development and testing for rare diseases is increased by lawsuit abuse.

New heart pumps, cardiac stents and practically any piece of medical equipment have a dollar amount built into the products by the manufacturer to pay for liability and legal costs. If we took even a part of the estimated total excessive tort cost of $589 billion a year we could potentially supply a low cost basic health insurance to all of the estimated 40 million people who now find it too expensive to have insurance.

About one third of the uninsured represent illegal aliens. Many illegal aliens go to the nearest hospital emergency room where a US federal law requires that anyone coming into the Emergency Room of a hospital must be treated. Most don’t pay for their E.R. care which drives the costs up for other people using the ER. Medicare, Medicaid and private insurance companies don’t help to pay for the “non-payers”. This is putting a great financial burden on hospitals. The hospital has to find money from somewhere to pay their costs. Unfortunately hospital profits are very small. Some hospitals are starting to close their ERs because they no longer can afford to lose money.

The Emergency Room is a very inefficient and expensive place to treat non-emergencies and routine medical problems. If a patient has for example a bad cough, in the emergency room they may wait for hours and receive very expensive care. They could be handled much more effectively by Primary Care Physicians in their office practice at a fraction of the cost5.

There are solutions available to the problem, but Congress is a difficult place to get anything regarding healthcare done. The President of the United States can make suggestions, but ultimately Congress writes the laws and authorizes spending.

No private business would survive if they did planning and implementation of business plans the way Congress conducts its business.

The bills that members of Congress write are constantly changing and both political parties have thousands of special interests they are trying to please. Congress allows “earmarks” to be inserted into bills at the last moment which caters to special interests that spend millions of additional dollars which reduces the amount of money that should be devoted to vital healthcare needs. It is like making a business plan on the back of a napkin and passing it around to over 535 members who makes changes, often with the aid of special interests who have parts of the bill already written and quietly have them inserted into healthcare legislation.

When the final bill is presented it is often so many pages that the members of Congress have no time to read it fully. It is almost impossible to accurately predict the short and long term costs, let alone know the damage from unintended consequences. Congress should take time to study and test legislation before it is implemented into law. No bill should become law without a careful analysis of predicted cost based on previous experience.

One solution is to have proposed healthcare legislation tested in several states who volunteer. Outside accounting firms should be hired to audit the results. Teams representing the medical profession, hospital administrators, healthcare statisticians and the bipartisan representatives of the public should be part of the process. They should find the mistakes, modify it or throw it out if it creates more damage than it helps. The public should know what the final cost of the trial period is compared to what Congress predicted. Is it cost effective or should it be modified? Once it has been shown to result in very significant statistical improvement it should have further gradual implementation. We have to be careful not to destroy the parts of our healthcare system that is giving excellent outcomes to the vast majority of patients.

There can be no expansion of healthcare or meeting the needs of the increasing numbers senior citizens without doctors. The Primary Care Physicians are the foundation of our health care system. The current Congress seems interested in pleasing the trial lawyers who are giving very large contributions to their reelection funds, while ignoring the fact that life blood of our healthcare system is hemorrhaging. That is real malpractice!

1. Gallup Organization Polls Nov 11-14-2007, Health and Healthcare poll with charts showing results of previous polls, using identical questions, dating back to 1999.

2. Harvard Researchers Say Medicare Worsens Primary Care Doctor Shortage Boston Business Journal – by Mark Hollmer July 7, 2008 https://www.bizjournals.com/boston/stories/2008/07/07/daily9.html

3. Primary Care Crisis is Here The Healthcare Blog Front Page, Bob Wachter July 21, 2008, https://www.thehealthcareblog.com/the_health_care_blog/2008/

4. Mcquillan, Abramyan and Archie, Jackpot Justice, The True Cost of America’s Tort System, p.35Pacific Research Institute ISBN-13:978-1-934276-00-06 March 2007 https://liberty.pacificresearch.org//

5. Emergency Room Visits Hits Record High, by Jacob Goldstein, August 6,2008 Wall Street Journal Blog on Health https://blogs.wsj.com/health/2008/08/06/emergency-room-visits-hit-record-high/

Norman Traverse, M.D.
Editor in Chief

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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