Health Care Reform on the Nation's Agenda: Ethical Foundations, Policy Goals, and How to Get There

Robert M. Sade, MD Department of Surgery Institute of Human Values in Health Care Medical University of South Carolina

My talk
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Current trends Problems with 1º social emphasis
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Myths re socialized medicine Dangers of fidelity to society (the state)

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Ethical basis of 1º fidelity to patients Current systemic problems in U.S. Presidential politics: views on health care reform

If you think health care is expensive now, wait until you see what it costs when it’s free. --P.J. O’Rourke

Current Trends in Medicine Favor Social Goals
 VIII.Medical student attitudes  A physician shall, whileH.O. work hours regard ACGME mandated caring for a patient, responsibility to the patient as paramount.  STS data: HOs benefit, pts suffer IX.  A physician shallEthics access to medical care AMA Code of support for all people.

Problems with 1º social emphasis

Myths re National Health Care Services. Under NHCS:
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people have a right to HC all have equal access to HC care given for need, not ability to pay people get higher quality HC administrative costs are lower resources allocated to maximize impact preventive HC is more available racial minorities fare better

JC Goodman, GL Musgrave, DM Herrick. Lives at Risk. Rowman&Littlefield, 2004 SC Pipes. Miracle Cure. Pacific Research Institute, 2004

Problems with 1º social emphasis

Central controlsubversion by self-interest
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spectacular collapse of socialist states produced disaster in U.S. HC financing

Efficient market mechanisms precluded

The Evolution of HC Insurance
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1929: The Baylor Hospital Plan 1932: Blue Cross begun
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exempted from taxes and reserve reqs encouraged ‘front end’ coverage covered services: prepayment, not indemnity IRS: HCI deductible for employers NLRB: HCI noncash benefit, bargaining chip

1940s: Federal policy (wage-price controls)
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The Evolution of HC Insurance

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hospitals--cost-plus physicians--UCR Hospitals:  cost   income employer pays  first dollar coverage physicians set fees w/o market forces tax avoidance for medical expenses  demand   prices

Perverse incentives of cost-plus
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HCI does not spread risks
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Central Problem of HC Financing
When people buy health care, they do not have the perception that they are spending their own money.

National Health Expenditures in Current Dollars (Billions)
2500 2000 1500 1000 500 0 1980 1990 1995 2000 2004 2008

Deloitte & Touche

Health Care Problems
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Unsustainable rise in cost of HC Failed policies  unanticip consequences
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NLRB, IRS, CON, DRG, RVS in M&M, mandated benefits, CMS regs Smothering bureaucr requirements (pub/priv)
Unfunded mandates  Strangulating paperwork  Unwarranted 3rd party intrusions in HC

Diminished access to HC
Uninsured (47M and rising, predicted)  Health disparities

Politics is the art of looking for trouble, finding it everywhere, diagnosing it incorrectly, and applying the wrong remedies. --Groucho Marx

Solving These Problems
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More Command and Control no answer My view:

Common men and women:
competent to live own lives  competent to know own interests and protect them  don’t need externally-imposed presuppositions re interests (one law fits all)

Structure of society should:
reflect needs of most (not least competent)  most important need: space (personal freedom)  provide safety net for most disadvantaged

Markets work well in U.S.; HC no exception

A View of Ethics
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Human beings living things, must maintain life Main tool is intelligence Potentialities (generic-unique) can be actualized Goal: human flourishing
achieved only thru choices and actions of individuals  no instincts, but habits of mind (virtues)

honesty, courage, rationality, justice health, wealth, friendship

specific goals, needs (values)

virtues and values require unique ranking

The Need for Rights

Protect possibility of flourishing

need personal territory: rights (negative)
freedoms of action  guaranteed by government (constitution)  expect errors, allow them (freedom/responsibility)

Central decision makers not free from error)

welfare rights (positive)
impose unchosen obligations  compromise possibility of flourishing

Medical Ethics

Individual virtues  goal of life

flourishing as human being good of the patient
biological-medical good  self-understood good

MD virtues  goal of medicine

MD Virtues Serving the Good(s)

Biological-medical good:
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scientific objectivity maintaining medical competence conscientiousness in applying knowledge/skills respecting pt’s self-determination benevolence in supporting pt’s goals honesty in disclosure

Patient’s perception of his own good:
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Medical Ethics Distinguishing Characteristic

Intimacy and vulnerability of pts
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access to personal secrets access to physical person

Pts must trust that they will not be misused

Trust is and must be the foundation of health care: serving the good of the pt

The Ethical Core of Medicine

The pt’s good is paramount

Effacement of narrow self-interest by MD
financial (fees, incentives, indigent care)  own health (epidemics)  inconveniences for pt’s needs

Obligations of secondary importance:
colleagues, partnerships  corporations  society

Markets and Freedom

Markets: social expression of reason & choice

support right to pursue values for human living

HC: right to seek care, accept or decline tx

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voluntary trade  everyone gains (not zero-sum) mandated terms  unintended effects health: nutrition, exercise, safe driving, hygiene,♬ Q: how money should be spent on health care-no! Q: how money should be spent on all health G&S best positioned: individuals living their own lives

Health ≠ health care (sanit. engineers vs MDs)
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Markets vs Centralized Control Myths

HC market excludes non-players (poor)

true only if charity not considered

MD (75%), private hospitals (60%) not lower in public systems (collective vs individual)

errors and omissions always present

Public institutions benevolent and wise
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politicians not less corrupt than businessmen public choice theory (powerful predictor)
political power used in self-interest  political decision making does not serve whole group

HC System Problems
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Unsustainable rise in cost of HC Smothering bureaucr demands (pub/priv)
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Unfunded mandates Strangulating paperwork Unwarranted 3rd party intrusions in HC Uninsured (47M and rising, predicted) Health disparities

Diminished access to HC
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Solving U.S. HC Problems
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Goal: affordable, safe, quality HC for all Administration’s agenda: empower people
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HSA (2003), need level tax field (employ-er-ee) consumer access accurate information, pricing

prudent buyers (few)   quality,  cost

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provider incentives to compete, innovate, risks safety net: physical, mental, financ vulnerable children (no M-aid,S-CHIP): refundable tax cred community health centers: double in 10 yrs encourage AHPs (Association Health Plans) tort reform (comp injured pts,  quality care)

58 55

20 94



Blendon et al., Health Care in the 2008 Presidential Primaries. NEJM 2007;358:414-422

13 45 46 21

39 13 74 41





23 42

65 22



McCain’s Reform Proposal
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HCI nationwide, not just in-state.  HSA flexibility. HCI through any org or assoc or direct from insur co. Refundable tax credits – $2,500 individual, $5,000 families (incentive to buy health coverage). Veterans use any provider (eg, electronic HC card). Support care delivery variety (eg, walkin clinic, retail store). Develop routes for cheaper generic drugs to enter U.S. market (including safe importation of drugs). Revamp Medicare payment:
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Pay for diagnosis, prevention and care coordination. No pay for preventable medical errors or mismanagement.

Reform Proposal Comparison
Tax subsidies McCain Replace regressive, wasteful subsidies with $2,500 ($5,000) refundable tax credit   ( HSA flexibility) Clinton No repeal, add more subsidies Obama No repeal, add more subsidies  by $500 a year Ideal: first dollar coverage, no HSA, adds $$$$, < Clinton Yes (children only)

Household expense National Cost

Mandated insurance

Access to care

 by $1,000 a year Ideal: first dollar coverage, no HSA, adds $1 trillion over 10 yrs No Yes (but still not universal: 12 million illegal immigra nts uncovered) Use Medicaid/SCHIP  Medicaid/SCHIP to enroll people in (move millions from private plans private broad access to public limited access).

 Medicaid/SCHIP (move millions from private broad access to public limited access).