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You’ve probably never thought about it. Hopefully you will now. Here is a PDF report just out from the Colorado Hospital Association. It is the worst imaginable job of trying to pass lobbying off as research or policy. Why do we allow a report like this to be written in the name of a non-profit? The report is nothing more than an exercise in creative writing, timed for the start of the legislative session, designed to distract legislators from the truth and to get them to “study” the problem instead of solving it.

The executive summary begins with the history of germ theory and how the transmission of disease was once misunderstood, suggesting that today we misunderstand the drivers of costs in healthcare and, by implication, we should do nothing other than study it. “Studying” a problem is one of the go-to strategies of lobbies.

Lacking any foundation, the report suggests the questions we should be asking — instead of the questions we actually ask. Here’s their list of what we should be looking at (what’s missing comes after):

  1. Colorado’s high cost of living significantly drives health care costs up. 

  2. Something in addition to health care costs is driving insurance premium rates in Colorado. High insurance premiums do not directly correlate with hospital overhead costs, nor with health care expenditures.

  3. Coloradans’ spending on health care and insurance premiums is lower – and growing slower – than the rest of the United States.

  4. Hospital spending is the largest expense “bucket” and it should be. Hospitals care for people when they are the sickest and most other care is provided in other, less expensive places. 

  5. What Colorado hospitals pay for workers, services and equipment is 6th highest in the nation. These expenses are also influenced by Colorado’s high cost of living. Further analysis is required to understand why Colorado’s proportion of non-medical costs is high. 

  6. Communities small and large need their hospitals to be there when they need care, especially when there’s a large-scale event, like a flu outbreak or natural disaster. Hospitals have to plan for those terrible events, and as Colorado’s population grows, hospitals will grow, too. Many Colorado hospitals reported operating at full capacity on multiple occasions in 2018.

What’s missing? Glad you asked. Here’s my list:

  1. Hospitals buying up physician practices then jacking up the price, adding facilities fees, and nickel and diming patients to pad the bills even further.

  2. An increasing lack of competition as the little guys are squeezed out (monopolies, by any other name).

  3. Collusion between hospitals and insurance carriers.

  4. Group Purchasing Organizations.

  5. Fast-rising pharmaceutical and medical device prices.

  6. Executive salaries and bonuses at what are supposed to be non-profit hospitals.

  7. Growing hospital profitability (yes, they are making ever-more money).

  8. And — you guessed it, A COMPLETE LACK OF PRICE TRANSPARENCY that would empower consumers and the broader marketplace to demand efficiency, balance supply and demand, and drive down costs.

Had the CHA done a good job and been even remotely honest, they could have included the six areas they suggested be studied to try and dilute these real reasons. But failure to include ANY of the real drivers of the out-of-control cost of hospital services is such a blatantly obvious (and stupid) strategy that we can only pray it backfires. 

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Happy New Year! I’ve been lying low for the past six months — ever since we had to withdraw the Colorado Ballot Measure due to the success of the healthcare industry’s misinformation campaign. But don’t think that means we’ve not been continuing to press forward. We have. While I can’t share the details of what we’re doing at Broken Healthcare just yet, I can tell you that it’s going to be a very big year for change on the healthcare front.

First, there are two new books that I strongly recommend if you are interested in coming up to speed on how American healthcare really works (and why it doesn’t). The first has been out a few months now and it’s a pretty heady read at over 500 pages, but the authors from the Cato Institute did a fantastic job of truly revealing how the system works in Overcharged. As one friend put it, “it’s time to invoke the RICO statute.” After reading this book, you’ll become convinced that America’s healthcare system resembles organized crime in many ways. Real organized crime is not always like what you see in the movies. Many of the people that work for organized crime syndicates are not really criminals themselves. The same is true in healthcare. It’s the few “mob bosses” that really make the system work the way it does. They are the ones that need to be stopped by policy makers.

The second book is titled The Price We Pay, which won’t be out until April. It’s written by my friend Dr. Marty Makary, a surgeon and professor of public health at Johns Hopkins. Marty’s writing style is very easy to follow and he does an amazing job of revealing much of what goes on behind the scenes in healthcare. Marty was a go-to guy for the Obama Administration and continues to be called upon for his expertise by the current administration. He is a true maverick and his book is at the very top of my list of recommendations.

Marty also appears in a movie I highly recommend. Netflix aired a feature-length movie focused specifically on medical devices and the corrupted system of medical device approval. It’s very well done and I suspect there are many more like it in the works. You can find The Bleeding Edge on Netflix.

Besides these exposés, there are many other signs that this will be a momentous year in healthcare. The press has been feeling emboldened to call out abuses. The Wall Street Journal has done quite a bit of excellent reporting lately. VOX runs outstanding and insightful stories. And many local journalists are exposing what goes on in their community.

New rules and regulations have started to stream from the federal government as well and I suspect that we are all going to benefit from Democrats and Republicans battling to see who can fix healthcare faster. Of course, they could also stand in the way of each other, but I suspect healthcare might be one thing they can come together on if they take the right approach. Time will tell.

So really just writing to let you know that the fight is far from over. There’s a new legislative session starting in Colorado, lots of activity at the Federal level, and the fourth estate is finally starting to do its job on the subject.

I’ll share more detail in the weeks to come.

Change is in the air.

Happy New Year!

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