I arrived this morning in the office at 8:50 a.m. to find Glenda, my office manager, buried in charts.  She had been there since 6:30, simultaneously arranging referrals that had been requested the day before, making sure that we had properly completed the detailed forms required by the Child Health and Disability Prevention Program that helps pay for the preventive care provided to some of our poorer patients, and listening to the voice mail from pharmacies to get the medication refill requests in order for me before the day begins in earnest. 

Glenda is a great asset to the practice.  An extraordinarily hardworking mother of two, four days a week she commutes with her husband from an outlying suburb to the office, arriving early to avoid the rush hour gridlock and get some of her work done before the phones start ringing. Having been with me for about ten years, she knows the ins and outs of dealing with all the health plans-- which ones require paper referrals, which use the Internet, which force her to hang on the phone waiting for an okay.  Only Medicare is easy; all we have to do is provide a patient with the name and phone number of the consultant.  MediCal, the California Medicaid program for certain categories of poor people, works the same way in our county but it is a bit more complicated.  Not all the consultants we regularly use accept MediCal referrals so the list of available consultants is limited. Glenda is playing what I think of as a game of "keep away" we play in our office.  The providers, knowing medicine but not the details of each health plan, send administrative work to the staff; Glenda and the rest put their stamp on the process and return the charts back to the doctors.  Eventually the game pauses, but right now Glenda is "losing" with over fifty charts on her desk.

My office, a small practice which I own and staff, has grown over the nearly 20 years I've been practicing family medicine in the San Francisco suburb of Burlingame.  At first I worked alone, delivering babies, assisting at surgery, rounding on my hospitalized patients, but always spending most of my time seeing patients in my office across the street from the hospital.  Over time, in order to make sure that I could take vacation and to spread the overhead, the practice has grown and now we are a group of five part time physicians and two nurse practitioners supported by seven full and part time staff.  I am in the office four days a week but have managed to work it out so that I am in by nine and out by three or four most days.  The other providers work a similar amount or less.  Some have other jobs which fill out their schedule.  All but two of us have children and share parenting responsibilities with our spouses.  Except for me all the providers are women.  Family medicine, in our community at least, has been moving in that direction.  Women still tend to be the second earner in many families and so more seem to be willing to accept the relatively low salaries family medicine offers and are interested in flexible hours so they can spend more time with their families.

Shortly after I arrive and begin to call back patients who've left messages overnight Glenda comes by with a small stack of charts that have been giving her trouble.  A couple require a short letter from me changing the "diagnosis code" I used when completing a lab order form.  Some insurance companies, it turns out, do not pay for preventive screening tests, so when I ordered a cholesterol or a prostate cancer screening test at the time of a physical, the test would not be covered under a patient's insurance policy.  Fortunately, the lab often catches these slips and notifies us so I can correct the "error".  For better or worse, the two patients' whose charts she brings today have elevated cholesterol levels, so I feel honest indicating that fact in the letter, knowing that the insurance company will not balk at payment.

In our office we work with two outside labs which between them are contracted with nearly all the insurance companies we deal with.  The hospital-run lab is the most convenient, and we are required to use it for about half of our patients.  The other lab must be used by a small fraction of patients. Medicare patients and those with certain PPO insurances, can go to the lab of their choice but choosing one lab rather than another may result in a much larger bill for some patients.  We have a special deal with one lab where we have a list with prices far lower than they charge the insurance companies or the patients when they bill them directly.  That way, when we order a test that we know may not be covered by an insurance policy or if we have an uninsured patient, we can collect the discounted price up front and then the lab will bill us rather than the patient.

Unfortunately, one of the charts Glenda brings presents a little nightmare. Bridget Hanley (her name and the names of all patients in this essay have been changed and the details of medical conditions slightly altered to protect privacy) sent in her 21 year old daughter a few months ago for a routine physical.  During the course of the evaluation, a few tests were ordered.... a Pap smear, some S.T.D. tests, a cholesterol test, and two hormone tests.  Unfortunately, because her insurance had changed, the wrong lab was used and Ms. Hanley got a bill for over $1000.  That is a lot of money to the Hanley family and she is rightly annoyed.  I am too: at the insurance system, at the lab's outrageous markups (if we had used our "special deal" the charges would have been only about $200), and at Ms. Hanley.  "Isn't it her responsibility to know which lab her insurance requires her to use?" I think, upset that she was annoyed at me for this mess.  Nevertheless, I sit down and send my second email to the lab director pleading for her intervention in seeking a reduction in charges.

The private health care insurance system which we deal with every day is an insidious bureaucratic monster.  The morass of more than 1300 insurance carriers in this country introduces an administrative mess beyond belief.  In our small office of essentially two full time equivalent providers, seven full time support staff are needed to cope with the complexities introduced by this system. I am quite certain that the wasted effort this system creates is so great that if we had a unified system of health care I could see 10-20% more patients - with two fewer staff.  Looked at from another direction, at least 10-20% of my current income is wasted on insurance bureaucracy which benefits no one.   

By 9 a.m., the receptionist, Alba, has come in.  She is the newest member of our staff, brought in only last month when our primary receptionist, Evelyn, became ill,  requiring extended medical leave for breast cancer treatment at the same time as another staff member was scheduled to be out for maternity leave.  So the office is operating a bit understaffed these days.  Fortunately, Evelyn's health insurance is through her husband's large employer. He works as an animal care technician for a public university medical center.  As long as he works they are covered.  I try not to think what would happen should budget cutbacks lead him to lose his job.  The prospect is frightening for her, for her family of four, and for our office.  I certainly would feel obliged to add her to our office health insurance program should this occur.  But would the insurance company accept her?  What would happen to our premiums? Even assuming no rate increase, adding her to our policy would amount to about a six dollar an hour raise.  And what about coverage for her family?

 The receptionist job requires her to verify each patient's insurance status, checking lists, looking on-line, and calling for approvals as she confirms insurance eligibility and documents changes.  Missing an insurance change can have costly implications for both patients and our practice.  Between changes in jobs and employers changing insurance plans to save a few dollars in premiums, there is a surprising amount of "churn" among health insurance carriers.  For Alba, learning the details of this part of her new job has been a challenge.

Three medical assistants spend hours daily communicating with patients about medication refills and calling or faxing pharmacies.  Most insurance companies allow patients to collect only a one month supply of medication at their local pharmacies (three months if patients can figure out how to manage a mail order program).  The rule makes financial sense for insurance companies.  Why should one company pay for a year's supply of medication if a patient may well switch insurance companies or lose their coverage after one month? Unfortunately, the rule doesn't make sense for patients.  Studies show that compliance with chronic medications is abysmally low, in part because of rules like this.

The churn in insurance coverage as people move, change jobs, or suffer economic hardships which lead them to cut back on expenses introduces a huge set of problems for our little office, and wasteful costs for the medical system.  Easily half of the new patients we see explain their search for a new doctor (no small task in a community where primary care providers are retiring in far greater numbers than they are starting out) as the result of an insurance change.  So we often "reinvent the wheel", setting up a new chart, getting to know a patient, revising medications, reviewing old medical records, helping those with complex medical issues reestablish with new consultants.  The economic implications for the system are obvious. 

A serious related economic issue for our office sprang up this year.  My associate decided that she was feeling a bit overwhelmed by her patient load and so decided to close her practice to new patients.  This is a more complex and consequential process than it seems. Contracts with insurance providers often require an open practice or establish tiers of reimbursement based upon whether a practice is open or closed.  Further, in closing a practice, a wheel begins turning so that the closure is indicated in published listings and on line resources.  This process can be slow and then difficult to reverse.  Years ago I had closed my practice for similar reasons.  When volume dropped, I attempted to re-open.  Some insurance directories, however, lagged in updating these changes for years, leading to much frustration and some degree of financial hardship.

When my associate decided to close her practice, we settled upon closing only to those patients "provided" through our local independent provider association, an organization which manages insurance company contracts for doctors in our area and with which we have a good working relationship.  Gradually, over the course of a year her patient panel from this source dwindled from 1200 to 800 patients.  At that point, feeling the pinch of lost income to the practice, I asked her to reopen her panel.  We are largely paid by capitation, "per member per month" from these providers so this source of income had dropped by about one third.  She was shocked and appalled by the request.  Despite the closure of the practice and the substantial loss of income, her workload had declined only slightly.  How had this happened?

What we had experienced through this closure was the shock of "adverse selection".  By closing her practice to new patients, my associate lost from her capitation list those patients who bounce in and out of insurance, often healthy or more mobile people who don't have regular need to see a doctor.  With capitation, a private insurance innovation, you payment is based upon the number of patients assigned to a doctor rather than upon the nature of the care required.  She was left with a group of patients who tended to be the ones who see her more regularly.  Hence, less income, same work.     

Of course, this process is something that private insurance companies play in reverse.  A great deal of insurance company money is spent attempting to avoid patients who could actually require medical services.  Underwriting, the process of selecting which individuals and business clients to insure and varying charges based upon assumptions of how much those clients will use their insurance is the backbone of the insurance industry.  Marketing, the process of selling insurance, has become a primary tool of this process.  Has there ever been an insurance company advertisement that encourages patients with serious chronic illnesses to sign up?  Instead, television ads depict elderly men walking on the golf course.  The idea is to create a "favorable risk selection", patients signing up for health insurance who are unlikely to use it; leaving  those who need it to some government-provided "safety net" or left to fend for themselves, uninsured.

My first patient of the morning is Uluake Tonga.  His English is not great, but we can get along.  We have known each other for nearly 20 years. Like most of my Tongan patients (there is a surprisingly large group of this nationality in this part of the San Francisco Bay Area) he comes with a family member who can help him translate.  His history is complex, as are his medical needs.  Briefly, he has diabetes and most of its complications.  Mr. Tonga has never been good at working with the medical system. A hard working airline food preparer at the San Francisco airport, he had for years denied his diabetes.  He believed in some natural medications and failed to see me very often.  I've long suspected that the expense of conventional medication was part of the issue.  He had insurance of the sort that required him to pay a significant deductible every year and when I took over his care from his previous doctor I noted that his chart had "sent to collections" stamped on it more than once.

Mr. Tonga first faced his diabetes in a serious manner when he was hospitalized for a vision threatening fungal infection.  Soon afterwards, because of  layoffs in the airline industry, he was without insurance and decided to return to Tonga for a few years.  Medical care in Tonga is free and while in the South Pacific he did get care for his diabetes and his blood sugar was finally controlled. Nonetheless Mr. Tonga returned with progressive disease.  Now, with kidney failure requiring dialysis, he is better about compliance with his care.  Maybe it is because the gravity of his disease is too much to ignore, but I suspect a lot has to do with the fact that his kidney failure now entitles him to Medicare benefits.

Medicare and its cousin, the Veterans' Administration health system, contrast markedly with the bureaucratic inefficiency and buck passing of the private health insurance system. These systems, which share the fundamental features of centralized funding and near universal enrollment of the populations they serve, have shown that they can provide better quality care and higher satisfaction at a substantially lower cost than the private health system. Within these systems there are no resources spent on achieving a favorable risk selection, marketing, underwriting, investor relations; nor are there corporate profits.  As a health care provider, when I deal with Medicare I operate within a clear cut set of rules that applies to all my patients, making referrals, prescriptions, etc. easy to accomplish.  

When I see Mr. Tonga, or any of a multitude of other patients whose care has been compromised by the complexities, gaps in coverage, or the increasing unaffordability of private health insurance I wonder about alternatives.  Increasingly, I have discussed these alternatives with my patients.  During the course of an office visit or speaking to a patient over the phone problems which relate to the inadequacies of the health care system often arise.  In a typical day there might be four or five opportunities to discuss issues related to health care reform with my patients.  Yet despite the number of different health care financing reform proposals that are bandied about these days virtually all of my patients gravitate towards the same approach:  a simple and comprehensive health care plan paid for through taxes and provided through the network of private providers with whom they are familiar.

From my end, as a physician and small business owner, eliminating the multitudes of rules, the files of thick contracts, the variations in co-payments, deductibles, and  formularies, no longer needing to tell patients that they can't see the provider I'd recommend because their insurance doesn't allow it, seems like a dream come true.  I want to be confident that my employees have access to quality medical care, that I won't have to be out shopping for a new plan next month, and that I won't have to choose between a raise or medical benefits for my medical assistant's newborn when she returns from maternity leave this winter.

But how do we get this done?  It doesn't take much thinking to realize that the only proposal that makes sense to get what is needed is a single payer plan, a Medicare-For-All.  Other proposals, health savings accounts, consumer directed health care, managed competition, employer mandates, individual mandates or variations on these themes all promise benefits but suffer from failing to have the potential to achieve true universal coverage and from being hugely expensive because of their reliance upon private health insurance. While some of these variants have been subject to experimentation in the United States (the Massachusetts plan, most notably) only a single payer approach has been shown, in both the U.S. (Medicare) and abroad (throughout Europe and Canada) to actually work.   

A publicly financed decentralized system of private health care that is not tied to employment or "category" could eliminate the waste in the bureaucratic private health care system and eliminate the multitude of compartmentalized public and private systems which currently pay for segmented components of health care.  Imagine!! No need for Medicaid, MediCal, CHDP, SCHIP; a reduced scope for worker's compensation insurance, medical liability insurance, and automobile insurance; human resource departments downsized.....the list goes on and on. Essentially an improved Medicare for all this reform would eliminate the distinction between health care for the poor and health care for the rich and reduce the confusion, waste, and annoyance which my office staff and I face in dealing with so many different health insurers.

Something is missing in our political debate over medical care.  Over and over again I've heard people in power or those writing about the issue support the logic of the argument for single payer reform and then dismiss it without much consideration.  Barack Obama has supported this change in theory, but adds that we have to begin from where we are.  Jacob Hacker, the Yale and Berkeley political historian, seems resigned to the observation that fundamental change is just too hard.  His Healthcare For America proposal reaches towards a single payer system but undermines its cost-savings and universality by keeping a huge role for private insurance.  David Cutler, the Harvard professor most often linked with the Obama for President campaign, digs for hope that incremental changes in the health care delivery system will work and argues that the "Obama plan" that preserves insurance company waste and allows for continued corporate risk selection won't require too much of a tax increase. 

A telling comment came from a member of the President's Council on Bioethics, during their review of the ethics of health care reform proposals.  After commenting favorably on the powerful arguments with which he had been presented he demurred that these were "arguments that we are entirely incompetent to evaluate".  Another commissioner supported the notion of single payer reform but wondered, "if it's not realistic in this country."   Even among advocates on the progressive side of the political spectrum there is a resigned assumption that single payer is somehow just too much of a change for our country to accept.

From my perspective in the trenches of primary care and small business, however, I can see no other way forward.  For my well-insured patients, a switch to single payer will hardly alter the face of the health care system they currently experience.  But it will reduce everyone's level of economic and health insecurity.  None will need to worry if something is covered.  There will be no more holding on to unsatisfactory jobs simply to keep insured.  The process of paying for care will be simplified.

 As a small business owner, I won't have to worry either.  Some tax will be paid, a payroll tax, a value added tax, whatever[1].  But there will be no need to agonize over the question of which plan to choose and no more health insurance expense.  As I look at my office budget, the $36,144 that I currently spend on employee health insurance[2] is less than the $44,498.97 that I calculate would be owed under a tax of the magnitude contemplated by authors of single payer reforms. But when I add in reduced insurance-generated paperwork, reduced billing costs[3], and an increase in my own efficiency, this sounds like a reasonable deal for me as an employer - even without considering the improved care it would give to my patients and the increased mobility it would give to my employees who might seek to improve their lives by changing jobs.

From where, then, does the political and academic reluctance to embrace single payer reform derive?  There would be losers, of course, and this generates some focused opposition.  The health insurance business would be essentially eliminated, perhaps surviving as a remnant to serve as a data collection and money disbursement system.  Pharmaceutical companies and medical device manufacturers might feel the pinch of tough negotiations from a central purchasing center.  But the interests of patients and health care providers of all sorts are sufficiently aligned that having a single payer should not prevent us from getting the health care that we need.  Certainly the experience of other developed nations with national health insurance supports this conclusion.

The last great attempt at achieving a major overhaul of our national health insurance system-- the Clinton administration's reform effort-- foundered for many reasons: It was developed among a group of interested parties, largely outside of the public eye, creating the impression that it was beholden to "special interests".  The plan was immensely complex and required the creation of new agencies to oversee the program which could be portrayed as "big brother"-like control.  This, together with provisions that employers must purchase private insurance for employees raised fears about potential costs.  Small business owners who have increasingly avoided purchasing health insurance for employees perceived themselves to be losers, while already insured employees in larger businesses feared the specter of managed competition and the reform proposal's focus upon cost control would result in lower quality and reduced choice.

            Now, circumstances are different.  The crisis has deepened, with a greater proportion of our gross domestic product going to support health care and insurance expenses, more uninsured, vastly more underinsured, patients feeling the pinch of health care plans with greater individual financial responsibilities, and providers increasingly frustrated by the complexities of dealing with the private health care system.  The reality of a Democratic administration with substantial Democratic majorities in Congress can finally provide a political environment where hope leads to action and action leads to change.

            Politics, and political change, has been described as the art of the possible.  But what is possible only comes about when those who believe in the need for change act upon that belief.  Possibilities can be created.  Hope can lead to change.

A Chance to Begin From Scratch:

How Obama Can Fix The Economy and The Health Care System At The Same Time

Aaron M. Roland, M.D.

In the face of an economic crisis unprecedented in more than half a century, pundits are asking how President-elect Obama will alter his ambitious proposals.  The implication is that economic hardship must lead to scaling back or even abandonment of the change upon which he had based his campaign.  

            Certainly, in the face of changing conditions, the new President will have to reconsider his plans.  But in the case of health care, the crisis may have an unexpected effect. It may allow Obama move beyond his modest proposals to something far more comprehensive.

Obama's existing health care proposals argue for tightly regulating insurance companies, expanding employer-based health insurance, and opening the Federal employee health program to all.  But by even the most optimistic estimates this complex plan will lead to coverage of only about 50% of the uninsured and will entail a cost of up to $1 trillion over the next ten years.  In a world of $700 billion dollar bailouts, this may not sound like much, but in an economic environment where need is widespread, alternatives should be considered.

            As recently as August the President-elect voiced his support for an alternative. "If I were designing a system from scratch," he offered, "I would probably go ahead with a single-payer system."  The rationale for this idea is simple.  The private insurance based health care system has become a bureaucratic nightmare of buck-passing and profiteering.  It is rife with waste that has nothing to do with providing quality health care.  By eliminating that waste we've solved the problem.

Now, only 65% of private health insurance premiums are spent on health care. Instead, insurance company executives earn hundreds of millions of dollars while corporate marketing departments spend fortunes selling insurance to the healthy just as their utilization departments resist paying for the care of those who become ill.

On the other hand, Medicare, with centralized funding and near universal enrollment of the population it serves, provides better quality care and higher satisfaction at a substantially lower cost. Medicare's bureaucracy takes up only 3% of its funding.  No surprise, as there is nothing spent on avoiding care for the sick, marketing, or corporate profits.

The economic crisis offers the new President the opportunity most other reformers have not had--the chance to begin, as he has said, "from scratch."  The American people have voiced an overwhelming desire for change.  We have come to understand that business as usual isn't always good business and that the business models that private systems create don't always work in the public interest.  And we've learned we need to pay attention to our money.

As a doctor in the trenches of primary care, I can see no other way forward.  For my well-insured patients, a switch to Medicare for all will hardly alter the face of the health care system they currently experience.  But it will reduce everyone's level of economic and health insecurity.  None will need to worry about what is covered.  None will need to cling to unsatisfactory jobs simply to keep insured.  The process of paying for care will be simplified.

This is not socialized medicine, but a plan for public finance of our diversified private health care system. An improved Medicare for all offers relief from the waste in the bureaucratic private health care system.  It can eliminate a multitude of public and private programs which currently pay for segmented components of health care, eliminate the distinction between health care for the poor and for the rich, and reduce the confusion, waste, and annoyance which providers and patients face in dealing with the 1300 insurance companies which litter the existing health care landscape

Politics, and political change, has been described as the art of the possible.  Remarkably, the crises we face have made the seemingly impossible happen.  We have a new President, a man who has inspired our hope.  Let him begin from scratch. Let crisis and hope lead to real change.

Copyright November 5, 2008

Aaron Roland is a family physician practicing in Burlingame, California and clinical associate professor at U.C.S.F.