From Finance to Science: The Coming Paradigm Shift in Healthcare
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To everything, there is a season. A season for healthcare finance, and a season for medical science. And now, we are seeing a turn of the seasons, from the former to the latter--from finance to science. Why? Because, to borrow a phrase, there is no alternative. Today we are seeing all healthcare-finance schemes, right and left, puddle into each other, into an ever-more expensive muddle; eventually people will realize that if people are sick, they are expensive--and so disease should be the focus, far more than insurance.

The headline in Monday's Washington Post tells the tale: "Romney would keep key parts of health-care reform." As Mitt Romney said Sunday on NBC's "Meet the Press," he wants to repeal Obamacare, except for the parts that he likes:

Well, I'm not getting rid of all of health care reform. Of course there are a number of things that I like in health care reform that I'm going to put in place. One is to make sure that those with pre-existing conditions can get coverage. Two is to assure that the marketplace allows for individuals to have policies that cover their family up to whatever age they might like.

Considerable confusion has ensued. If those two insurance provisions--each one its own kind of mandate on the insurance companies--are preserved in place, then the private insurance market becomes non-viable in the event that the better-known third mandate, the personal mandate, is repealed. Thus in the event that Romney were to win this November, the insurance industry can be counted on to join with the new president in preserving selected parts of Obamacare. That is, if Romney would be fighting for the preservation of the pre-existing conditions mandate and the family mandate, the insurance companies would, in turn, be fighting for the preservation of the personal mandate.

Faced with this prospect, the right is, by various turns, professedly worried and professedly not worried. Meanwhile, the left is having its fun accusing Romney of flipping and flopping. But the bottom line can be put most simply: An Associated Press headline reads, "Romney shifts toward center, says he'd keep parts of Obama's health plan."

To the extent that Romney is moving to the center--and taking Paul Ryan with him--that will probably help the GOP's chances this November. However, the new 45th President would then face the challenge of reducing spending while holding Medicare spending harmless. After all, Paul Ryan's "Road Map" plan calls for the protection of Medicare, as is, over the next ten years; that's two years longer than the Romney presidency, under the best-case scenario. Indeed, The Case of the Purloined $716 Billion seems to have been solved by both parties pledging not to "raid" Medicare. Meanwhile, of course, Alzheimer's Disease alone is on its way to a trillion-dollar-a-year cost by mid-century, mocking all attempts to control costs by the use of financialist tools.

To put it bluntly, in a democratic society in which the elderly can vote, market forces and management forces are likely to prove less powerful than "disease forces." Or, to put it even more bluntly, 10 lbs. of sickness is, well, 10 lbs. of sickness, no matter how it is financed or accounted for--it simply won't all fit into a 5 lbs. bag.

It's no wonder, therefore, that national healthcare expenditures are projected to rise 7.5 percent in 2013. The basic reason is simple: until we figure out how to replace vast amounts of low-productivity labor with high-productivity technology, it's inevitable that healthcare costs will continue to rise.

And so while plenty of worthwhile targets for federal budget-cutting can always be found, the dollar totals for such cuts, even if they are achieved, would be relatively small. Yes, Medicare fraud is a big potential target, but the history of anti-fraud efforts is discouraging, in large part because millions of elderly people, most of them sick with something, tend not be receptive to any discussion of budget cuts; people don't trust the budget-cutters, and crafty politicians--many of them backed by the fraudsters themselves--are eager to play to that mistrust.

So perhaps one way to prove to the elderly, and to others, that Medicare reform is not synonymous with cuts is to do just that--show that there's more to Medicare reform than cuts. If no cuts to Medicare are coming, anyway, for ten years, why not use the coming decade to earn some good-will with oldsters by focusing on their immediate health problems, as opposed to our overall long-term fiscal problems?

Yes, let's move the center of gravity of health, from financial bean-counting to medical discovery-making. That would improve the health not only of seniors, but also of all of us--and heathy people, of course, are cheaper than ill people.

In fact, deadly diseases are coming into costly prospect. The West Nile Virus and the latest Hantavirus are killing people. For the moment, the authorities seem to be concentrating on spraying, but over time, it will dawn on the public that it would be better to eradicate the bugs rather than fumigate the general population. And in India, public-health authorities are confronting something new: "totally drug-resistant tuberculosis." So we might ask: If any of those diseases were to break loose in the US, what would happen then? Whose budget projections would have any validity at all? And who would care about who has health insurance or not? Enlightened self-interest, as well as compassion, would require the hospitalizing/quarantining of everyone afflicted--costs be damned.

After all, as everyone in the field knows, we've had a primitive form of national health insurance since 1986, in the form of EMTALA, which guarantees "coverage" to everyone who can get himself or herself to a hospital emergency room--and nobody is talking about repealing that law.

Indeed, when a medical crunch comes, authorities can be counted on to waive healthcare costs. In a society that is both televised and compassionate, the money will always come from somewhere.

So are we stuck? Trapped in fiscal mire forever? No, not at all. Because we can, in fact, walk and chew gum at the same time. That is, we can pay our existing bills, and also figure out to how to reduce future costs by curing present-day illnesses. Yes, such an effort would be a big change; it would mean focusing on science, and science-related issues, such as research money, patent reform, FDA streamlining, and so on. Still, when a way forward is blocked, for reasons we have seen, it's important to find a new way forward.

Let's start with Democrats. Dr. Elaine Kamarck of Harvard's Kennedy School, a veteran of the Clinton-Gore White House and current member of the Democratic National Committee, recently wrote in The Daily Beast that it's time to "switch the paradigm" on healthcare. That is, as she put it, we should "have the government focus on curing diseases that cost so much to treat." Kamarck concluded, "Voters will support federal dollars to cure the diseases that cost us so much. What they will not support, after all this time, is a fundamental change to Medicare."

To be sure, there are plenty of experts still championing fundamental changes to Medicare--defined as financial changes--but Kamarck has a point: The voters, by a pretty big margin, don't agree with those experts. And as we have been reminded just in the past month of presidential campaigning, the voters have a way of "bending the curve" of politicians' wills, persuading pols to agree, after all, to keep Medicare as it is.

Another Democrat. US Rep. Rob Andrews of New Jersey, published an opinion piece in The Wall Street Journal last week, under the headline, "An Apollo Program Against Disease." Andrews' piece was part of a symposium on Democratic advice to President Obama in the event that he wins a second term, but it was good advice for all of us:

We are at our best when we focus on great purposes that transform society and transcend politics--uniting the nation and expanding settlement through the construction of a transcontinental railroad, defeating Nazism, and reaching new celestial heights through the Apollo program.

In a second term, President Obama should focus on a similar great purpose: championing cures for the destructive diseases--including dementia, cancer, diabetes and HIV/AIDS--that have tragically taken the lives of countless friends and neighbors.

Three elements essential for success are present. First, even with the scant resources we have devoted to cures, scientists have constructed some of the key building blocks for breakthroughs, such as the Harvard-Columbia work on the tau protein and its role in the development of Alzheimer's. Second, it is now very inexpensive to obtain vast amounts of working capital at historically low interest rates. Finally, public support for a "cures project" is exceptionally strong among people of all ideologies and backgrounds--independents, Democrats and Republicans.

The mechanics and specifics of how to raise, finance and allocate the funds for cures would need fleshing out. However, before we paralyze ourselves in disputes over the means, a re-elected President Obama should call us together to fulfill a compelling moral purpose, strengthen our lagging economy with a cascade of new industries, companies and jobs, and dramatically improve our fiscal position.

Again, here indeed is a JFK-like vision for medical science--the sort of vision that could rally the American people in a big way.

Meanwhile, over on the right, earlier this month I wrote a piece for The American Conservative entitled "The GOP's Alzheimer's Opportunity." The piece lamented the "crash" of Serious Medicine over the last few decades then lauded the prominence afforded to Alzheimer's research--along with other kinds of research--in the 2012 Republican Platform, and, finally, suggested that the real opportunity was for Romney:

So here could be Mitt Romney's big opportunity: opening up his image, and opening up the election, by embracing a big positive vision for healthcare-that is, better science, not just better finance.

Even Romney's fiercest detractors have to concede that he would be effective at organizing an imaginative public-private consortium, in the manner of the Olympics, on Alzheimer's-that is, calling in moguls, medical experts, pharma corporations, maybe even an international partner or two.

And of course, Romney could attempt the same elixir-one part enterprise zone, one part X-Prize, one part corporate, and, yes, one part government-for other maladies, too. What American, for example, wouldn't salute a serious effort to heal wounded warriors of traumatic brain injuries?

Medical progress offers something that few politicians are offering today: hope. Barack Obama had it four years ago, and he has lost it since. Romney does not have it now, but he could have it if he wanted it. Paradoxical as it seems, the hope that Romney needs today could be found in that most depressing of topics-Alzheimer's.

Okay, that's just one opinion. But interestingly, my article was tweeted out by US Rep. Michele Bachmann (R-Minn.).

Any time Democrat Andrews (Americans for Democratic Action 2010 rating--latest available--90 percent; American Conservative Union lifetime rating, 14 percent) and Republican Bachmann (ADA 2010 rating 5 percent; ACU lifetime rating, 99 percent) can agree on something, that's a hopeful sign that medical progress is possible.

If we want to save money, and save lives, we have to focus on science, not finance. Finance can't affect health directly. By contrast, science can affect health directly, and that, in turn, can affect finance. And so that's why we need a lot more science, because it makes everything cheaper, including health.

After all, as we have seen, there is no alternative.

1 Comment

Want to cut Medical costs?
Stop doctors from practicing "lawyers" medicine, the doctor's defense against potential malpractice .... aka unnecessary tests to protect and drive up a doctor's billing per hour. Cap malpractice awards! Millions awarded wont replace a priceless parent. National Licensing & Arbitration Boards could rid bad practitioners from medicine. (NYSE has an Arb Board).
Why can't health insurance companies compete across state lines? Pols afraid they will get a smaller 'Bag of Donuts' from them because of greater competition?
Yes, instituting such resulting short term savings would enable us to divert more monies towards cures.
So with a new Congress, Washington can sew it up & complete their health care operation by November 2013's elections. Whether we abolish or circumcise Obamacare, it is time .... long overdue, for a change to our Serious Medicine Strategy.
This was a beautiful column Mr. Pinkerton.

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