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Mary Washington Hospital in Fredericksburg, Virginia

Ran into the CFO of Mary Washington at the courthouse in Fredericksburg this morning. Sean T. Barden is his name. Two other executives (I think) were with him. I introduced myself and extended my hand. All I received back was a stare. So I said, “I’d like to shake hands,” and the only response I got was, “no.” Apparently MWH, or at least Mr. Barden, is not prepared to engage in a dialogue yet.

At the court house, all of the cases pending were dropped as was expected. A number of cases scheduled for a few months out were “pulled in” to be dropped in September. We’ll continue to monitor the court’s docket and will show up as needed. But for now, it seems the law suits and wage garnishments will stop. For now…

But it’s not over—of that myself and many members of the legal community in Fredericksburg are quite sure.  There are many people still having their wages garnished based on prior judgments. We’ll be trying to find them, sifting through court records and asking the community to spread the word. We have strong reason to believe that many people were denied their right to due process through improper service, so we’ll be doing what can to vacate old cases and get people refunds.  There’s no statute of limitations on improper service, according to the judge. There might even be a class action law suit in the making. Some local attorneys are getting excited about the possibilities.

It’s important to keep spreading the word in Fredericksburg. It is highly likely that the Hospital will begin outsourcing its collections to collections agencies (one or more). We’re going to make sure those collections agencies have a tough time collecting. As much as we can, we’re going to make the cost of collecting very high, and the amount collected very low. The goal is that no one wants to take on Mary Washington’s debt. We know how to stop collections agencies from collecting. We’ve done it elsewhere with great success. The key is ensuring patients know there’s help out here.

Mr. Barden’s reaction, refusing to so much as shake my hand (his security director was much more polite yesterday) should be a strong indication that that hospital has made no commitment to changing its ways. It’s not lowering its prices; it’s not revisiting its financial assistance policies; and it’s not returning money to the people it’s over-charged.

Yesterday I posted photos listing those who have left MWH in their estate plans. These (below) were  among the other photos I took while at MWH yesterday before being informed that there was a secret policy against taking photos—a policy that was not posted on any sign and that wasn’t written anywhere that could be shown to me. Remember…the “proprietary policy,” just like prices.  These photos show people who have already donated money to the hospital. Many probably will donate again. Perhaps you can help me track them down to let them know there are much better causes they can give their money to.

Patients have no voice in Fredericksburg. The employees we’ve talked to make it sound like they have no voice, either. I have also gotten the sense that the hospital’s board has no voice. Perhaps donors have a voice.

David Silverstein
BrokenHealthcare.org

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Donors to Mary Washington Hospital

Dear friends,

Yesterday, I paid a visit to Mary Washington Hospital in Fredericksburg, VA. Had a nice lunch in the cafeteria—cold burger and fries. I think the cafeteria may be part of their strategy to drum up business—certainly not the healthiest food around. But in total fairness, I find hospital cafeteria food to generally be very unhealthy just about everywhere. Bizarre, I know.

I was doing some work in the cafeteria when a security guard approached me. He asked me if I was the one taking photos in the lobby. I said I was. He told me it was a HIPPA violation and that I couldn’t take photos. That, of course, set off some alarm bells for me so I asked to speak to the security officer. My concern was that if I could see what was on the walls (I was taking photos of donor lists), then so could everyone else. I felt compelled to report it. But alas, the guard’s manager told me it wasn’t a HIPPA violation after all. Phew.

Then I had a chat with some attorneys in town and decided to return to the hospital lobby to see what else I could learn. This time the security director, Calvin Bostic, came to talk to me. He said that people “had an expectation of privacy in the lobby,” so that’s why photos were prohibited. That struck me as odd. People take photos in hospital lobbies all the time. I also explained that I was interested in what was on the walls, not people. The things on the walls were clearly put there for all to see. In particular, there was a list of people who have left Mary Washington Hospital money in their estate plans. Mr. Bostic told me I was perfectly fine to come in with a pen and paper to write down the names, but it was against policy for me to take pictures. I told him I had already taken the pictures—that’s why they approached me in the first place, and that I had already emailed them off to others. He was a very nice guy, by the way. So, together we walked outside and looked at the polices posted on the door. They said that firearms were not permitted. Nor was smoking. But nothing about photos. He said they had lots of policies that were not posted. When I asked if I could have a copy, since he wanted me to abide by the policies, he said, “no.” The policies were “proprietary” he told me. I guess they consider their no-photography policy to be similar to their prices. They’re proprietary. LOL.  So beware—when you enter a hospital lobby you are subject to secret rules that you are not allowed to know about unless someone chooses to tell you the rules after-the-fact. Hmm…

As we continued to talk, Mr. Bostic asked if I was recording our conversation. I told him I wasn’t, but I was. I lied. I record all of my conversations. Virginia is a one-party consent state. I didn’t need his permission to record our conversation. The recording is just for my own personal records anyway, though my understanding of Virginia Law is that I could play them for you if I wanted to. But you’ll have to ask…

People tend to not speak the truth when they know they are being recorded, so when legal, I find recordings to be very useful. I’m also not sure there’s much of an expectation of privacy in a busy hospital lobby, but of course he told me patients did expect privacy in the lobby. Hmm….

But back to what I was interested in on the walls. What I’m most curious about is why people would leave Mary Washington Hospital in their wills in the first place. People really could donate their money more wisely.

Above is the photo I took before learning of the mysterious, proprietary policy. I did agree not to take any more photos…for now, but if you know the names of the people in the photo, please reach out to them and ask them to rethink their donations. I’ll post the names of all of the donors on the donor wall, too. These are just the people who haven’t donated yet. And I invited Mr. Bostic to join me at the Capital Ale House in Fredericksburg, VA. He seems like the kind of guy I’d like to have beer with. There will be a number of local attorneys there, too.

David Silverstein
BrokenHealthcare.org

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Perhaps the biggest victory yet!

While President Trump’s signing of a groundbreaking executive order on Monday was a big win, we just got what might be an even bigger win—at least in the short term.

Late last year I met Dr. Marty Makary, a renowned surgeon and professor of Public Health at Johns Hopkins University. Marty told me about the research he was doing. That research was published this week in JAMA which talks about the incredible problem of hospitals suing patients—primarily poor and lower middleclass patients, for unpaid medical debt that they can never come close to paying because of the absurdly high prices for which they are being billed.

One of the hospitals Marty and his research team focused on was Mary Washington Hospital in Fredericksburg, VA, which sues on the order of 100 patients every month. 

After learning of Marty’s work, Broken Healthcare joined the research team, identified patients, and hired a local attorney to create a pseudo public defender model. The result has been that every time (100%) that we provided a legal defense for a patient, the hospital dropped its law suit.

Then, last week, Marty, myself and the local attorney we hired (Joey Kirchgessner) sent a letter to the CEO and all board members of Mary Washington Hospital. Earlier this week, the Wall Street Journal and NPR both called out the hospital for its predatory billing practices. And then today, the hospital posted what’s below on its website—declaring that it will no longer sue patients for unpaid medical bills. The letter we sent is below as well.

This is a huge victory for the people that were being victimized in this small community, but it’s not a solution to the problem of skyrocketing healthcare prices. That can only be achieved by moving to a fair and competitive market that is created through truly transparent prices. Only then will we start to see the cost of healthcare decline, enabling affordable access for all.

Please applaud Mary Washington’s CEO and Board for responding to the public pressure they were facing. And feel good about how we were able to help hundreds upon hundreds of people’s who’s lives were being destroyed. But also know that this is going on in many other communities all over the United States and that the broader problem is far from solved.

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I have been contacted by many people asking for a full copy of the Executive Order signed by the President yesterday. You can find that official version below, along with a couple of photos.

The battle ain’t over. What the Executive Order does is direct the Secretaries of Health, Labor and the Treasury to write the detailed rules that will get it done. The value of an Order from the President is just that—it’s an order. It removes much of the pressure to compromise with corrupt actors in the healthcare industry that having been telling the President and Congress lies for years. The President is fed up, as are many members of Congress. The industry has, in many ways, become its own worst enemy.  I’ll be staying close to the rule writing in the months to come, doing my best to ensure the rules written are truly effective.

Office of the Press Secretary

FOR IMMEDIATE RELEASE
June 24, 2019

EXECUTIVE
ORDER


– – – – – –

IMPROVING
PRICE AND QUALITY TRANSPARENCY IN AMERICAN HEALTHCARE TO PUT PATIENTS FIRST

By the authority vested
in me as President by the Constitution and the laws of the United States
of America, it is hereby ordered as follows:

     Section 1.  Purpose.  My Administration seeks to enhance the ability of patients to choose the healthcare that is best for them.  To make fully informed decisions about their healthcare, patients must know the price and quality of a good or service in advance.  With the predominant role that third-party payers and Government programs play in the American healthcare system, however, patients often lack both access to useful price and quality information and the incentives to find low-cost, high-quality care.  Opaque pricing structures may benefit powerful special interest groups, such as large hospital systems and insurance companies, but they generally leave patients and taxpayers worse off than would a more transparent system.

    
Pursuant to Executive Order 13813 of October 12, 2017 (Promoting Healthcare
Choice and Competition Across the United States), my Administration issued
a report entitled “Reforming America’s Healthcare System Through Choice
and Competition.”  The report recommends developing price and quality
transparency initiatives to ensure that healthcare patients can make
well-informed decisions about their care.  In particular, the report
describes the characteristics of the most effective price transparency efforts:
 they distinguish between the charges that providers bill and the rates
negotiated between payers and providers; they give patients proper incentives
to seek information about the price of healthcare services; and they provide
useful price comparisons for “shoppable” services (common
services offered by multiple providers through the market, which patients can
research and compare before making informed choices based on price and
quality).

    
Shoppable services make up a significant share of the healthcare market, which
means that increasing transparency among these services will have a broad
effect on increasing competition in the healthcare system as a whole.  One
study, cited by the Council of Economic Advisers in its 2019 Annual Report,
examined a sample of the highest-spending categories of medical cases requiring
inpatient and outpatient care.  Of the categories of medical cases
requiring inpatient care, 73 percent of the 100 highest-spending categories
were shoppable.  Among the categories of medical cases requiring
outpatient care, 90 percent of the 300 highest-spending categories were
shoppable.  Another study demonstrated that the ability of patients to
price-shop imaging services, a particularly fungible and shoppable set of
healthcare services, was associated with a per-service savings of up to
approximately 19 percent.

    
Improving transparency in healthcare will also further protect patients from
harmful practices such as surprise billing, which occurs when patients receive
unexpected bills at highly inflated prices from out-of-network providers they
had no opportunity to select in advance.  On May 9, 2019, I announced
principles to guide efforts to address surprise billing.  The principles
outline how patients scheduling appointments to receive facility-based care
should have access to pricing information related to the providers and services
they may need, and the out-of-pocket costs they may incur.  Having access
to this type of information in advance of care can help patients avoid
excessive charges.

    
Making meaningful price and quality information more broadly available to more
Americans will protect patients and increase competition, innovation, and value
in the healthcare system.

     Sec. 2.  Policy.  It is the policy of the Federal Government to ensure that patients are engaged with their healthcare decisions and have the information requisite for choosing the healthcare they want and need.  The Federal Government aims to eliminate unnecessary barriers to price and quality transparency; to increase the availability of meaningful price and quality information for patients; to enhance patients’ control over their own healthcare resources, including through tax-preferred medical accounts; and to protect patients from surprise medical bills.

     Sec. 3.  Informing Patients About Actual Prices.  (a)  Within 60 days of the date of this order, the Secretary of Health and Human Services shall propose a regulation, consistent with applicable law, to require hospitals to publicly post standard charge information, including charges and information based on negotiated rates and for common or shoppable items and services, in an easy-to-understand, consumer-friendly, and machine-readable format using consensus-based data standards that will meaningfully inform patients’ decision making and allow patients to compare prices across hospitals.  The regulation should require the posting of standard charge information for services, supplies, or fees billed by the hospital or provided by employees of the hospital.  The regulation should also require hospitals to regularly update the posted information and establish a monitoring mechanism for the Secretary to ensure compliance with the posting requirement, as needed.

    
(b)  Within 90 days of the date of this order, the Secretaries of Health
and Human Services, the Treasury, and Labor shall issue an advance notice of
proposed rulemaking, consistent with applicable law, soliciting comment on a
proposal to require healthcare providers, health insurance issuers, and
self-insured group health plans to provide or facilitate access to information
about expected out-of-pocket costs for items or services to patients before
they receive care.

    
(c)  Within 180 days of the date of this order, the Secretary of Health
and Human Services, in consultation with the Attorney General and the Federal
Trade Commission, shall issue a report describing the manners in which the
Federal Government or the private sector are impeding healthcare price and
quality transparency for patients, and providing recommendations for eliminating
these impediments in a way that promotes competition.  The report should
describe why, under current conditions, lower-cost providers generally avoid
healthcare advertising.

     Sec. 4.  Establishing a Health Quality Roadmap.  Within 180 days of the date of this order, the Secretaries of Health and Human Services, Defense, and Veterans Affairs shall develop a Health Quality Roadmap (Roadmap) that aims to align and improve reporting on data and quality measures across Medicare, Medicaid, the Children’s Health Insurance Program, the Health Insurance Marketplace, the Military Health System, and the Veterans Affairs Health System.  The Roadmap shall include a strategy for establishing, adopting, and publishing common quality measurements; aligning inpatient and outpatient measures; and eliminating low-value or counterproductive measures.

     Sec. 5.  Increasing Access to Data to Make Healthcare Information More Transparent and Useful to Patients.  Within 180 days of the date of this order, the Secretary of Health and Human Services, in consultation with the Secretaries of the Treasury, Defense, Labor, and Veterans Affairs, and the Director of the Office of Personnel Management, shall increase access to de-identified claims data from taxpayer-funded healthcare programs and group health plans for researchers, innovators, providers, and entrepreneurs, in a manner that is consistent with applicable law and that ensures patient privacy and security.  Providing access to this data will facilitate the development of tools that empower patients to be better informed as they make decisions related to healthcare goods and services.  Access to this data will also enable researchers and entrepreneurs to locate inefficiencies and opportunities for improvement, such as patterns of performance of medical procedures that are outside the recommended standards of care.  Such data may be derived from the Transformed Medicaid Statistical Information System (T-MSIS) and other sources.  As part of this process, the Secretary of Health and Human Services shall make a list of priority datasets that, if de-identified, could advance the policies set forth by this order, and shall report to the President on proposed plans for future release of these priority datasets and on any barriers to their release.

     Sec. 6.  Empowering Patients by Enhancing Control Over Their Healthcare Resources.  (a)  Within 120 days of the date of this order, the Secretary of the Treasury, to the extent consistent with law, shall issue guidance to expand the ability of patients to select high-deductible health plans that can be used alongside a health savings account, and that cover low-cost preventive care, before the deductible, for medical care that helps maintain health status for individuals with chronic conditions.

    
(b)  Within 180 days of the date of this order, the Secretary of the
Treasury, to the extent consistent with law, shall propose regulations to treat
expenses related to certain types of arrangements, potentially including direct
primary care arrangements and healthcare sharing ministries, as eligible
medical expenses under section 213(d) of title 26, United States Code.

    
(c)  Within 180 days of the date of this order, the Secretary of the
Treasury, to the extent consistent with law, shall issue guidance to increase
the amount of funds that can carry over without penalty at the end of the year
for flexible spending arrangements.

     Sec. 7.  Addressing Surprise Medical Billing.  Within 180 days of the date of this order, the Secretary of Health and Human Services shall submit a report to the President on additional steps my Administration may take to implement the principles on surprise medical billing announced on May 9, 2019.

     Sec. 8.  General Provisions.  (a)  Nothing in this order shall be construed to impair or otherwise affect:

    
     (i)   the authority granted by law to an
executive department or agency, or the head thereof; or

    
     (ii)  the functions of the Director of the Office
of Management and Budget relating to budgetary, administrative, or legislative
proposals.

    
(b)  This order shall be implemented consistent with applicable law and
subject to the availability of appropriations.

    
(c)  This order is not intended to, and does not, create any right or
benefit, substantive or procedural, enforceable at law or in equity by any
party against the United States, its departments, agencies, or entities,
its officers, employees, or agents, or any other person.

                              
DONALD J. TRUMP

 THE
WHITE HOUSE,

  June 24, 2019.

###

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Today, the U.S. Department of Justice issued a warning to the Academy of Motion
Pictures, effectively saying: “Don’t cross the line to further solidify your monopoly!”

The Academy, which produces the
Academy Awards (a.k.a., the Oscars) is contemplating rule changes that would
effectively shut Netflix movies out from Oscar contention, relegating them to
the Emmys as “Made for TV Movies.”

Obviously Hollywood insiders are
trying to protect their turf, and fortunately for all of us, the Justice
Department is totally on top of things, taking pre-emptive action to
prevent the Motion Picture Academy from extending its monopoly over the film
industry.

This should come as a relief to all
of us Americans who thought the Justice Department was asleep at the wheel and
didn’t care about monopolies stifling competition. I was getting particularly
concerned (but am now relieved), since the U.S. Government Accountability Office
just issued a report on the subject. Here’s the first
paragraph from the report:

What
the GAO Found 

Enrollment in private health insurance plans continued to be concentrated among a small number of issuers in 2015 and 2016. In the overall large group market (coverage offered by large employers), small group market (coverage offered by small employers), and individual market (coverage sold directly to individuals), the three largest issuers held 80 percent of the market or more in at least 37 of 51 states. This is similar to what GAO previously reported for 2011 through 2014.

Note: Please do not ask me which GAO official’s 6th grade geography teacher taught them that there are 51 states. We all know what they mean. I think. Puerto Rico? The District of Columbia? Maybe—that would be 52. So, I guess we don’t really know after all.

When a behemoth industry is reduced
to such a small number of competitors and can’t quite be called a “monopoly,”
it starts to resemble Russian oligopolies, which in American parlance is often
referred to as “organized crime.” In Oligopolies, it becomes more profitable
for the small number of competitors to “play the game” than to truly challenge
each other. When an industry grows to 6, 7, 8 or more competitors, success
depends on innovation and efficiency. When reduced to just three, the cost of a
price war exceeds the potential gains. So they play ball, not trying to outdo
each other. This is how organized crime works. When there are two or three, or
even four crime families that control a city’s drug trade, they all play by the
unwritten rules, sticking to their territory and keeping prices consistent.
Only when the 5th, or 6th, or 7th crime
family (or gang, in many cases) enters the market, do they really have to
battle for their territory.

A battle is what we need, because
that’s the nature of markets. When just a few hospital systems or insurance
carriers dominate a market, they play the game. Only when new competitors try
to enter the market do they really get competitive — improving quality and
service, and driving true innovation. That’s missing in American healthcare,
because both providers and payers (insurance carriers) are increasingly
participating as members of an oligopoly, often regional in nature because of
the way healthcare works. In other words, what we’re dealing with can best be
described as the healthcare cartel, and we need the Justice Department to
engage and battle it like any other cartel.

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As the Federal Government
prepares to implement new rules requiring greater price transparency in
healthcare, the healthcare industry’s army of lobbyists is being fully
mobilized.

At the top of the list of arguments against price
transparency is the idea that patients don’t use price information, even when
it’s available to them, because “healthcare is different.” It’s a misleading
argument at best, because we’ve never experienced, or experimented with, a
system of truly transparent pricing in healthcare.

In her blog on the CMS website a few months ago, CMS Administrator
Seema Verma wrote, “You have a right to know the price.” I couldn’t agree more.
The paradox is that once everyone knows the price of something, we don’t really
need to know it anymore. That’s because in real consumer markets, we mostly act
as a collective, not simply as individuals. And as long as prices are
transparent and a small number of us check them, we all benefit. Without
transparent prices, the fact that one party checks prices wouldn’t do anyone
else any good, because we wouldn’t know if we were being charged the same price
as everyone else. But in a system of transparent prices, we’d know. Now, that
doesn’t mean sellers must charge us all the same price, it just means they’re
more likely to. Economists call the phenomenon “price convergence,” the
presence of which is one of the key indicators of whether a market is working.
The complete lack of price convergence in healthcare is the most obvious and
glaring signal that the market simply doesn’t work.

I call the phenomenon of collectively driven markets, “We,
Not Me,” markets.

To understand the phenomenon of “We, Not Me,” in everyday
terms, consider that your local supermarket has about 50,000 uniquely bar-coded
items on its shelves. When we enter the store, we don’t necessarily know what
we’re going to buy, we just know that the price of everything is available, if we care to review it. At the
supermarket, we buy things by the quart, or pound, or piece, or bunch; we buy a
bottle, or a six pack, or a case; we use coupons and loyalty cards; and we know
which supermarkets trend towards luxury items at higher prices and which
provide great bulk discounts. Many of us don’t know the difference between
dried milk and condensed milk, baking soda or baking powder, and we’ve never
heard of most of the cheeses in the cheese aisle. Yet somehow, we still make
good choices without feeling at risk of being ripped off. How can that be? The
answer is that we trust that others
have looked at the prices and that as a result, market forces are at work. In
other words, we act as a collective all of the time, and as individuals just some
of the time. That is the power of markets and how healthcare should (and can) really
work.

Opponents often cite one particular example of where price
transparency won’t work in healthcare: emergency services. After all, if any
situation defies the logic of “shopping around,” it’s when we have a bullet in
our chest, right? Well, not exactly, because if prices were transparent, we
wouldn’t have to worry about whether the prices at any particular ER were egregious
any more than we have to worry about prices at the local supermarket. If prices
were transparent across all participants in the healthcare system, media
outlets like Consumer Reports would study them for us. So, too, would university
students, journalists, government agencies, and countless others. All we need
to know is that prices are transparent enough that if we want to compare prices, we easily can. Many people would. But
if they didn’t have time, or simply didn’t want to, they wouldn’t have to. When
we recognize the power of the collective, it becomes obvious that that the
“shopping around” has been mostly completed before we find ourselves in need of
emergency medical services in the first place.

Because I haven’t found any one particular economic theory
that perfectly describes the phenomenon of “We, Not Me,” I’ve named it the
“Theory of Consumer Proxies.” That is, as consumers, we have many proxies. I
have you, and you have me. We have the media, universities, consumer groups,
and even governments. We all act as proxies for one another, with the seller
never sure who is or is not comparing prices, or when they do it. Buying
healthcare should be easy, it shouldn’t be like buying a used car.

“We, Not Me,” is a force in every transparent consumer
market. There is no reason that healthcare should be exempt from the influence
of the collective consumer, and there’s every reason that it should be. So the
next time you hear a politician, or journalist, or healthcare industry
executive telling you what people will or will not do with access to real
prices in healthcare, just remember that, IT DOESN’T MATTER, because someone
else will have already done it for them.

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Just picked up my car from the shop. It was routine service, though I had told them to replace my brakes because I have almost 50,000 miles on the car and I’m sure it’s time. I don’t like to wait just because I might be able to get a few more months on them since I often have trouble finding time to bring my car in. I’d rather get it out of the way.

Yet despite telling them I was willing to spend hundreds of dollars to replace my brakes, they still didn’t replace them. Why not? Because they insisted I have more than enough life on my brakes to make it to and even past the next service. In this particular car, I routinely use the down-shifting capability, so I guess I’ve successfully stretched the life of my brakes far longer than I have before.

What’s the point? The point is that the auto dealer has earned my trust (not the first time). Even though I’d given them permission to take more of my money, they didn’t. I assumed my brakes would be worn and they knew that. They also know with so many miles on the car, and a customer that believes it’s time to replace the brakes, that they’d never be questioned if they replaced them unnecessarily. They still didn’t. That breeds trust.

In medicine, we often hear that things are too complicated for patients to really judge for themselves. But that misses the point. Right now we don’t have a system we can trust in healthcare. While there are many healthcare providers I do trust—my own doctor, our pediatrician, our dentist and our kids’ dentist—there are many more that we don’t. And even when it comes to the providers we trust, I still don’t trust their business practices and billing offices. They are pushed to do things unnecessarily (like taking my blood pressure or temperature before looking at a discolored toenail or referring us to other doctors in their practice group) even if they don’t believe that is truly the best course of action.

Establishing a healthcare marketplace that we trust is the ultimate goal of transparent pricing. There are other steps that are necessary to accomplish this, but don’t let the healthcare industry fool you by trying to pick apart the way patients will, or will not, use the information they are given. The healthcare lobby would certainly like to convince policymakers that patients won’t really use pricing information, because “it is confusing” or because “healthcare is different.” It is not different.

When I was picking up my car, in addition to an itemized bill (something I was given without having to request it), I also received a copy of the mechanics’ checklist with more than 25 things that they checked on my car and measurements of my brakes and my tire tread. I didn’t have to ask for this, either, and I can tell you that many drivers don’t know what HVAC stands for, when their drive belt should be replaced, or what struts are. It doesn’t seem to confuse them.

When we trust that a market works, we don’t have to scrutinize the price of each and every thing we buy. We have to spot check. We have to have confidence that a small percentage of others have checked. We want to know that consumer websites or the media would call out abuses.

We Americans want a healthcare system we can trust—one in which preventive medical care is as simple as preventive auto care, in which care for an injury is just like care for a banged-up car. It is more than possible—it is essential. Healthcare is only different because we allow it to be. We let an entrenched industry that is profiting from that myth continue to obscure information, to drive prices far higher than they should be, to generate profits that border on obscene, and to engage in the financial abuse of the least fortunate among us.

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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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With a very heavy heart, I announce the death of Colorado Initiative 146: Healthcare Price Transparency.

It could have been. We were on track to complete the signature campaign, but fake news killed it. Let me explain.

The initiative’s death blow was dealt at Colorado’s Democratic Party Central Committee Meeting in which the party voted down a request from Senator Matt Jones to endorse it. The endorsement itself was artfully crafted by Morgan Carroll, Party Chair. The party voted to “take no position”—foretelling its death. Without a Democratic Party endorsement, and with the opposition able to say they voted against endorsing it, it cannot pass in November.

What Happened?
Last week, Democrats surveyed their members. The results suggested an expected unanimous vote in favor of the initiative: 22 members for, zero against, five with questions. The vote was scheduled for Saturday, July 14th. And with that information, the healthcare industry mobilized, using Planned Parenthood and the ACLU to lobby party members. Lobbyists fed information to key Democrats—inflammatory, false, intentionally misleading information—and it spread.

The message sent Friday morning to Democratic Central Committee Members is here (it’s too long to include in this message, but I encourage you to read it). It was posted on Facebook by El Paso County Party Chair Electra Johnson. She knows now this was a mistake and has since removed the post, which should be a strong sign that she doesn’t stand behind it. She has also told me she intended to vote in favor of the ballot measure. But I suppose she doesn’t deserve too much credit for her mea culpa. I don’t believe she’s posted anything about why she removed the post and she also passed on the opportunity to get up and say something at the Committee hearing when members were invited to do so. She could have made the entire difference, but she chose not to. The damage had been done.

By midday Friday, with poison in the water, Matt considered pulling his request for the endorsement. But, understanding how important the measure was for Colorado citizens, he and Morgan stood strong. Why party members chose to trust Planned Parenthood and the ACLU more than Matt and Morgan I will never know, but I applaud them both for not taking the easy way out. I hope they have no regrets. They did the right thing—something we can’t say about many others.

Death by Friendly Fire
Democrats were used and should be outraged. They also need to accept culpability. Had an organization like the NRA done this, Democrats would be livid, speaking of dirty politics and the influence of big business. Will they be silent here, though, since the offenders are traditional Democratic Party partners? Or will they realize their party has been equally corrupted?

Planned Parenthood and the ACLU did the bidding of the healthcare industry. That’s right. Just as the NRA spends 10% of its energy advocating for the 2nd Amendment that it truly believes in, while the rest of its business is power brokering, the same goes for Planned Parenthood and the ACLU. Do we excuse such behavior because these organizations are also capable of doing good work? If we do not demand they replace their boards and executive leadership and turnover a new leaf, then we are accepting their continued distortion of our democracy. Democrats, this one is up to you. Are you going to hold anyone accountable for intentionally misleading you and condemning the American people to living with its current healthcare system?

Trust?
Trust is the operative word. Electra Johnson trusted Jack Teter, Planned Parenthood’s Colorado Political Director. If it were anywhere else in her life, I’d be willing to bet it would spell the end of a relationship. Will she forgive Jack in the interest of politics? Will she remain silent? Or will she become an advocate for the truth? Only time will tell. I took her at her word that she was duped. When we spoke this weekend at the Elizabeth High School meeting place, she told me she had read the measure six times since and didn’t find any of the problems she had written about. She said she intended to vote in favor of the endorsement. In the end, 54 people did vote in favor, but it wasn’t enough to pass.

Ms. Johnson wasn’t the only one who misplaced their trust. The ACLU was apparently making phone calls to Committee members who had placed their trust in the ACLU. I hope they all learned something and that members are inspired to simply not vote in the future if they do not feel qualified to assess something themselves. Having not read the initiative, but having had it “explained” to them by “trustworthy” special interest groups, Democrats voted against it after five minutes of debate and sealed its fate.

In politics, trust is among the most easily violated and quickly abused of all human qualities. Will Democrats punish those who lied to them? I doubt it. If I suggested that Coloradans stop contributing to Planned Parenthood until they change their ways, people would accuse me of being a threat to women’s reproductive rights. People will tell themselves that donating to Planned Parenthood isn’t about politics, continuing the erosion of democracy.

Representative Chris Kennedy was the voice of the opposition. Chris knows the truth. Months ago, he had offered to replace Representative Mike Foote as the sponsor of the legislative version of the bill had Mike be chosen to replace recently resigned Boulder Country DA Stan Garnett. Kennedy spoke against the measure this weekend and personally signed its death warrant by pointing out that six Democratic women had voted against it in the legislature. He didn’t mention that they had been duped in the same way. I’m not sure if the Democrats will post a recording of the meeting. If not, I have one and will get it up shortly. What Mr. Kennedy has done to his own party may not stop him from election in 2018 now that the primaries are over. But the phrase, “Remember 146,” will haunt any future election for Mr. Kennedy. I’m confident he won’t survive another primary. His position and remarks will live on.

Note: please do not confuse Chris Kennedy of House District 23 with the other Chris Kennedy running for State Senate. Do your homework. Punish the right man.

The vote was lost 77 to 54. The healthcare industry was smart. The timing had been carefully planned. It waited until Friday morning to spread misleading information. If we had been given another day to counter the lies, I’m confident it would have passed. But there was no time.

I let Democrats know that the initiative would be dead if they failed to support it. Following the vote, we pulled the plug and sent home circulators from offices all around the state. Tens of thousands of petitions will be destroyed, along with the hopes and dreams of the many volunteers and donors. I do not believe the magnitude of opportunity that was squandered will be understood for several years. Remember 146 every time you open a medical bill that you don’t understand.

Without a Democratic party endorsement, the lies in Ms. Johnson’s Facebook post foreshadowed the Fall media campaign to be funded by the Colorado Hospital Association, the pharmaceutical lobby, and the insurance industry. I’m told $30 million had been committed thus far to convincing Colorado citizens that healthcare price transparency is a bad thing. The failure of Democrats to affirmatively support the measure means the public will listen to that message. Only Democrats could have told that portion of the electorate that these are lies, but this weekend they declined to do so.

To fight back without a Democratic endorsement would have meant going dollar-for-dollar in the media battle. With an endorsement, we would have been able to spend a tenth of that money. A simple message from Democrats would have assured Democratic voters that the opposition’s ads were lies, but they weren’t prepared to do that and we simply can’t afford to continue without their endorsement.

While Republicans were going to be needed to help the public understand that price transparency would lead prices to go down, not up, and that transparency was pro-business, not anti-business, Democrats held the power on the other side of the message—that price transparency is patient protection. They were made to believe the opposite, however, and many were pretty easily convinced that somehow price transparency is a threat. Rep. Chris Kennedy became the spokesman. He was clearly on a mission, despite knowing the facts. He’ll now have no choice but to stand by his position now and the debate will continue. Whenever Chris is prepared for a public debate on the issue, I will be glad to meet him. He won’t do it. It is the ugliest part of politics when organizations like Planned Parenthood and the ACLU, and someone the people trust such as Chris Kennedy, sell their soul.

Remember 146.

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