About Steve

Steve is the CEO of Health Tactics, a health care consulting firm. He has been active in the health care industry for over 25 years, having run a California based IPA, been a hospital administrator, worked for several health insurance companies and consulted for medical groups, hospitals, pharmacy benefit managers and clinics. From this breadth of experience, Steve has developed a point of view on what it will take to fix our health care industry. Central to this point of view is the opinion that the individual, i.e. the consumer, must become as self sufficient as possible.

Health Reform: Should maternity care and pediatric coverage be considered “essential benefits” for women and men over 55 years old?

Now that health care reform, often called “Obamacare” will be implemented, one key question focuses on what is covered.  The Department of Health and Human Services (HHS) has recently released a list of “essential benefits”, that is, what must be covered by all plans in order to allow consumers to make fair comparisons.

The list is broken down into 10 categories, one of them being maternity coverage and another being pediatric coverage.

For women and men over 55, this might seem unreasonable.  And we are not just talking about the care that first comes to mind- should complications arise, maternity care brings with it care in a neonatal intensive care unit (NICU), the costs of a perinatologist and the costs of a neonatologist, all of which can be very, very expensive.

Then we get to pediatric coverage, which covers care over an 18 year time horizon, also very expensive.

For those over 55, the decision to have a child is exceedingly remote, if not impossible. And this is not a gender issue- it affects both women and men, and turns the concept of health insurance into one of health care subsidies.  One option is that maternity coverage and pediatric coverage be available as a “rider”, meaning available at an additional cost to those who want it.

So here is the question- should people over 55 be required to purchase maternity coverage? And by extension, should childless adults be required to purchase pediatric coverage?  What do you think?

Health Reform: Should maternity care and pediatric coverage be considered an "essential benefit" for women and men over 55 years old?

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Is it a good thing that some states refuse to implement the health care reform law (Obamacare)?

One of the more significant results of President Obama’s reelection is the impact on the health care reform law- his reelection eliminates the threats to repeal the law on “day one”.  However, some states are actively resisting the law’s implementation.

Specifically, one aspect of the law requires states to set up health care exchanges, where individuals could buy insurance at a competitive price (the exchange does not actually provide the insurance, but determines which insurers can participate).  Many states are refusing to set up the exchange.  One notable example is Texas.  Recently, Texas’ governor Rick Perry refused to implement an exchange in his state.

The Federal government will step in and operate the exchange in states that are unwilling or unprepared to implement an exchange on their own.  The deadline for implementation by the states is January 1, 2014.

So here is the question- how do you feel about states that refuse to implement the health care reform law, even after the Supreme Court decision and the reelection of President Obama?

How do you feel about states that refuse to implement the health care reform law even after the election and Supreme Court decision?

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The settlement of the Medicare lawsuit is a great thing!

The settlement last week of a significant lawsuit against Medicare now opens the door to increased treatments and therapies being provided to patients in their homes, and paid for by Medicare.

The specific change anticipated by the lawsuit involves a requirement that patients have some possibility of “improvement” in order for services to be approved for reimbursement by Medicare.  In the future, the possibility of improvement will no longer be a consideration.

This is long overdue and will change the lives of millions of patients and their families.

First, receiving necessary treatment will slow the pace of decline even if the possibility of actual improvement does not exist.  For people experiencing physical or cognitive impairment, receiving therapeutic services or treatments is at the very least compassionate.  It is also financially wise, which brings us to the second major benefit:

Paying for several months or years of therapy for a loved one can be financially devastating for all but the most wealthy families.  As a result, families experience the wrenching decision of paying for care for an elderly parent versus preparing the children for an advanced education.

It is also beneficial to society as a whole, because when our loved one declines to a certain point, we bring them to the emergency room where they are frequently admitted to the hospital, at a much higher cost, much of which may have been completely preventable.

Granted, some fear an explosion in fraud as providers of various skill levels rush in to provide, and bill for services.  Fair point.  But I for one am optimistic that as we move further into the world of information exchange and both electronic and personal health records, that services can be effectively monitored and that the impact of fraud will be far, far less than the benefit to patients, their families and society as a whole.

What do you think?

Is it a good thing that Medicare will pay for home based services without the requirement that the patient have a possibility of improvement?

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Prepare yourself during 2013- knowledge required!

Now that the Supreme Court has upheld the Affordable Care Act, should we all just sit back and go for the ride? Hardly.

Progress among the states is a patchwork- only 13 states have moved forward setting up health exchanges- a key enabler. An additional 22 states have started planning. The remaining states continue to resist.

What this means is that when 2014 arrives, the states will not all be ready. Your ability to access decent, affordable care will depend very much on where you live.

And so you should be prepared to look out for yourself, to some degree- with knowledge, so talk to your physician and do your own research; with tools, so use a personal health record, know how to research the quality and cost of hospitals and physicians; and have a network, whether it be through a traditional advocacy group, or through an online social network.

As our system changes and improves, we will collectively be much better off. But during the transition, there will be gaps, and we will all need to become more self reliant.

It’s really going to be on us.

Now that the dust has settled somewhat on the recent Supreme Court decision, we are seeing some states dig in and harden their positions against expanding health care coverage.

I truly believe that at the end of all of this, we will have a significant portion of our population who either:

  • continues to lack health coverage,
  • has coverage, but no physicians or hospitals will accept it, or
  • has coverage, but so much is excluded that the financial burden on families continues to be devastating.

And so the path forward, for many, will require:

  • a very high level of personal involvement
  • engagement with an effective support network and/ or advocacy group
  • active use of online research and management tools
  • activism- vote- engage your elected representatives.

Stay tuned, as this blog will comment on each of these issues.


So now the hard work comes- reducing costs.

First, let’s acknowledge the incredible victory in passing and then having confirmed by the Supreme Court the health care reform law.  It’s a great thing that millions will gain access to health insurance.

But this is only the beginning…

First, let’s face it, costs will rise in the short term.  With insurers covering millions who have previously gone without, many with pre-existing conditions, costs will rise.  The real challenge is in reducing costs, not so much of the insurance, but of the basic care services that the insurance must pay for- doctor visits, hospital stays and drugs.

The core problem underlying our runaway costs is that our system is designed, at nearly every stage, to deliver the highest cost service possible, and as many services as possible.  Reasons for this include:

  •             Fee for Service pay structure
  •             Defensive medicine and the fear of litigation
  •             Overcapacity of some service lines (supplier induced demand)
  •             A huge medical complex that can and does influence regulations

Until we focus on costs, and change key structural aspects of the health care industry to support a lower cost model, health care itself, whether accessed through insurance or not, will remain out of reach for many.


Maybe Doctors Can Learn From Lawyers

On May 2, an article was published in the New York Times, titled “Top Judge Makes Free Legal Work Mandatory for Joining State Bar”.  The article describes how more and more people need urgent legal services but cannot afford them.  It goes on to describe the pros and cons of requiring lawyers to provide some free services (pro bono) as a condition for joining the New York State Bar.

We have a similar problem in health care- a large number of people who cannot afford health care services.  And I am not talking about insurance.  I am talking about the doctor and hospital visit.

In health care, we have doctors refusing to see patients because Medicare or Medicaid do not pay enough.  And these patients have nowhere else to turn.  The doctors use the threat of refusal as a key part of their strategy when negotiating for higher reimbursement.

How can we allow this?

In a previous post on this blog, I have proposed that doctors be required to accept Medicare as a condition for receiving or renewing their DEA license (federal level- the DEA license is what allows them to prescribe), and to accept Medicaid as a condition for receiving or renewing their Medical license (State level).

We place physicians on a professional and social pedestal, and their incomes are higher than that of any other profession.  In return, we should require something of them- not grant the right to walk away from persons in need.  Doctors, take a lesson from the lawyers, or lose your protected, lucrative turf!


We (the consumer) are about to get trashed!

I saw three articles that disturbed me last week.  Taken together, they are no less than frightening.  All were printed in the New York Times.

First came an article titled “Insurers alter cost formula- patients pay” (New York Times, April 24).  The main point is that insurers have changed the way in which they reimburse doctors and hospitals.  The reimbursement has gone down, so the patient’s portion has gone up.

The second article, also printed in the New York Times on April 24, is called “Pricing confusion adds to pain at hospitals”.  The main point here is that hospital bills appear to have no rhyme or reason, with the price for the same procedure in the same geographic area varying wildly, sometimes by a factor of ten or more.

Finally, in the New York Times on April 25, “Debt collectors pursue patients in hospitals” describes how employees of a collection firm, “Accretive Health” are actually allowed front line positions in their client hospitals where they can, and do, get right in patient’s faces demanding payment for expected or past services, sometimes before emergency services are provided.

Now put all of this together-

  1. We don’t know what something will cost and may be off by a factor of 10
  2. Whatever it does cost falls more and more on our shoulders to pay
  3. We will subjected to very extreme collection practices, including denial of services, until we pay what we owe.

Now compare this to the experience of citizens of every other advanced country in the world- costs are simply not allowed to come between a person and their need for health care.

We, the consumer, are about to get trashed, and it is time to do something about it! (Stay tuned for future posts).

Should we keep the health reform law? #healthreform #obamacare #supremecourt

Shortly, the Supreme Court will begin deliberating the fate of the health care reform law (Obamacare).   One of the key provisions of the law concerns the individual mandate– the requirement that everyone purchase insurance or face penalties.

I have commented on this particular issue in a previous post.

In addition the the very constitutionality of the law, the Supreme Court will also decide whether the rest of the law will stand if the individual mandate is overturned.  This principle is called “severability”.

So we might wind up with an all or none decision- if the individual mandate goes, so does the requirement that insurers cover those with pre-existing conditions.  So does the prohibition against setting the price of an insurance policy based in part on gender.

So here is my question:  on an all-or-none basis, should we keep the health reform law or repeal it?  What do you think?

On an all-or-nothing basis, how do you feel about the health reform law?

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The Trend Towards Adult Day Care

A recent article in the New York Times describes a trend where elderly patients can be treated through a home based managed care model, rather than in a nursing home.  This model is generally referred to as “adult day care”.

It’s about time!  Why should patients be required to spend their entire existence in a nursing home, at much higher cost, when they can live in their own homes and receive visits from medical professionals and other caregivers?  Moreover, it has long been known that people much prefer to be cared for in their own homes, including during their final days- yes, people prefer to die at home than in an impersonal institution.

The luxury of being treated (and dying) at home has long been reserved for the well-off, who can afford private nurses and all of the related home-based equipment.  The thinking has long been that if the government is paying (Medicaid), then you need to be in an institution.

Too bad that it has taken a financial crisis- state budgets under pressure, led by Medicaid costs- to get state programs to relent and allow people to be cared for in an environment that is less expensive, more comfortable and inherently safer- the home.

A Brief Comment on the Ryan Medicare Plan

Medicare is too expensive and becoming more unsustainable every day.  Congress has also demonstrated that they will bow to special interests before implementing what they have already passed- the so-called “doc fix”, whereby reimbursement cuts to physicians that are already mandated by law are deferred, year after year.

One approach is the Ryan plan, named after Representative Paul Ryan of Wisconsin.  Without delving into the details of the plan, which are debated hotly by very partisan commentators, one great flaw in the plan appears to have escaped comment:

That is, the notion that physicians will compete for patients, thereby reducing costs.

This assumption is deeply flawed for one simple reason- there is a well documented shortage of physicians.  Economics 101, and the basic law of supply and demand, teaches us that if the supply is low, the price is correspondingly high.

Physicians will never have to compete aggressively for patients (the Ryan Plan assumes that they will) as long as there is a shortage of physicians.  Rather, patients will have to chase physicians and endure long wait times to get an appointment.  Physicians will continue to raise fees, not lower them, and they will threaten to stop seeing patients whenever their fees are reduced- hence the “doc fix”, which happens year after year.

If Medicare is changed to a voucher system, as Rep. Ryan proposes, seniors will be at the mercy of physicians, who are in short supply, and who will retain any negotiating leverage as long as there is a shortage of physicians.

Until we are able to address the shortage of physicians (train more and/or allow the greater use of nurse practitioners, midwives, pharmacists and other “physician extenders”), it is wrong to place seniors in this ruinous position.

Health Care Reform and the Mandatory Purchasing of Insurance

Is it right to require people to purchase health insurance?  I have mixed feelings on the subject.

First, I understand the concept of insurance and of “pooled risk”- the notion that the premiums of those whose homes do not burn will be used to pay for damages to the homes that do burn.  And I understand the need for everyone to participate in order for this system to work at its best.

The part where I struggle is when we are delivered to a voracious, for-profit industry like so many lambs to slaughter.  There should be, at the least, a “reasonably priced”, non-profit option (we can discuss what a reasonable price is separately).

When I discuss this with my friends, they invariably point out that auto insurance is mandatory.  To which I reply, “If one does not wish to pay for auto insurance, there is an alternative- it is called Public Transportation.

What alternative exists in the health insurance discussion?  If we choose to not purchase an overpriced product from a for-profit health system, what alternative do we have?  What happened to the “public option”?

So here is where I end up: if a reasonably priced, non-profit alternative exists, I support mandatory coverage.  But if the only option is to pay into an overpriced, for-profit system, then I do not support mandatory coverage.  What do you think?

What are your feelings about mandatory health insurance coverage?

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Should health care be better for the wealthy? What is the proper role of government?

Should health care be subject to and run by the rules of a private, for-profit system?

If you make more money than I do, I agree that you should wear nicer clothes, drive a nicer car and eat in fancier restaurants.  But should your water be any cleaner?  If our homes catch fire, should yours be put out and mine not?  If we are in an accident, should the ambulance arrive for you first?

Just which things should be better for people with more money?

Personally, I do not think health care should be any better for people who are wealthy.  Granted, the wealthy will have private rooms and private assistants, but should the care itself, the medications and the surgeries that are required be any better for the wealthy?  And what is the proper role of government in allocating these resources?  What do you think?

Should health care be better for the wealthy?

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What is the proper role of government in allocating health care resources?

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What happens when the pie is shrinking?

Throughout my entire life, the economic pie in the US has been growing. This has made possible civil rights, women’s rights and a number of safety net programs. Now, we are entering a time when the pie is shrinking, or at least perceived to be shrinking.

When this happens, people are unwilling to share. What used to be “I am doing well, so you can have a little” has become “What I gave you before, well I need that back”.

This is what is driving our nasty and unproductive politics. The question is, “What do we do about it”?

Game theorists look at this as a form of dividing the pain. And there is no universally agreed on definition of fairness, especially when dividing pain.

Where we need to start though, is understanding the situation we are in, and where this tends to lead us if we are unaware- that is, towards selfishness, unreasonableness and conflict.

The pie is perceived to be shrinking. Let’s understand this and manage through it in a way we will look back on and feel proud.

Re-published: Who is responsible for our out-of-control costs?

As we all know, the federal government and nearly every state is facing huge budget gaps. Health care is a large part of every crisis:

  • Medicare is a large part of the federal budget crisis
  • Medicaid is a large part of every state budget crisis

Health insurers are not to blame this time:

  • The Medicare discussion is about Medicare, not Blue Cross, Aetna, Cigna, United or Humana.
  • The Medicaid discussion is about Medicaid, not Blue Cross, Aetna, etc.

The health care reform bill that we recently passed was really health insurance reform- yes, we needed to reform the insurance system.

Since Medicare and Medicaid are not traditional insurers, but still seem to be drowning in costs, the question is, “Where should we focus our reform efforts going forward?” What do you think?

Since the Medicare and Medicaid discussion is not about the insurers, where should we focus our reform efforts going forward? Select all that apply.

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Does this make sense?

Have you ever considered-

Someone is hungry, so they stand outside a restaurant asking for food. Eventually the owners may call the police. Someone is homeless, so they stand outside a hotel or motel asking for a room. Again, the owners may eventually call the police.

Because this person is homeless and hungry, eventually they collapse from exposure and/ or hunger. Now, we have a very expensive hospital bed and a very expensive hospital meal just for them.

Something to think about…

Which of the key health industry players is to blame for the current problems?

Who is to blame?  All major participants have good and bad aspects:


  • The Good:  They bargain provider prices down.  They pay our bills when we get sick .
  • The Bad:  They deny coverage inappropriately.

Pharmaceutical companies:

  • The Good:  They provide medications that heal.  I’d rather take medicine than receive surgery.
  • The Bad:  They overcharge and put drugs on the market that are far more expensive and no more effective than what they replace.


  • The Good:  They provide good, compassionate care.  They save our lives!
  • The Bad:  They put us on a financial treadmill and churn patients to increase their incomes.


  • The Good:  They provide the infrastructure within which healing and recovery take place.
  • The Bad:  They build empires and overbuild in general, driving up costs.  A cath lab in every town?

Device and supply manufacturers:

  • The Good:  They invent and produce live improving and life extending devices, e.g. pacemakers, MRIs.
  • The Bad:  They inappropriately work the system to sell more of their products.

So what does all this mean?  There is no universal “good guy” or universal “bad guy”.  In improving our system, all parties must be looked at carefully, and all parties must accept change!

Should home health care budgets be increased (supported through legislation and payment), decreased or left alone?

An interesting part of the health care discussion concerns home health care.  It is unquestionably less expensive to treat someone at home, particularly someone who needs a lot of nursing care and assistance with eating/ dressing/ bathing.

However, many states, as the grapple with high Medicaid costs, seem to want to reduce funding for home care.  There is also some fraud in the home care sector, as there is throughout the health care industry.

Reducing or eliminating home care services forces patients to seek more expensive in-patient care in hospitals and nursing homes.  Reducing funds for home care seems to be financially short sighted.  So what should we do?  What do you think?

Should funding for home care be increased, decreased or left alone?

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The 7 Stages of Managing Our Health Information

Why did Google pull the plug on Google Health?  Why is consumer adoption generally low across the entire landscape? In my opinion, the consumer has still not embraced the change required for this to happen.  It will happen.  We’re just not there yet.  To explain this, I offer “The 7 Stages of Managing Our Health Information” (adapted from Elisabeth Kubler-Ross’ “The 7 Stages of Grief”).

Stage 1:  “Wait a minute, I have to pay for that now?”

Stage 2: “I can’t afford all of this! I don’t know what to do! I should have lost weight, quit smoking, taken better care of myself!”

Stage 3: “This is outrageous! Can’t we go back to the old way? It’s the government’s fault!  It’s the insurer’s fault!”

Stage 4: “Oh my God, I am so screwed!  Who is going to help me?”

Stage 5: “Maybe I need to do something about this.”

Stage 6: “I seem to remember something about Online Tools and Resources.”

Stage 7: “OK, I’m signed up now.  Let’s do this!”

Note: Progress through this framework is not smoothly linear.  Some jumping back and forth occurs.

In my opinion, consumers are generally in stages 1 through 3.  The light bulb will go on, and business models will become viable, when a large number of consumers get to stage 5.  As I stated, we as a country are not there yet.  But with the coming changes to Medicare and Medicaid, and the ongoing increases in deductibles, copayments and coinsurance, we soon will be.  Stay tuned.

For two very thoughtful, insightful discussions on why Google pulled the plug, see Missy Krasner’s post at “The Health Care Blog”, and Janice McCallum’s post at “Health Content Advisors”.

Finally, I am interested in what you think about consumer readiness.  Please take the following brief poll, using the “7 stages” framework above.  Select up to 3 answers.

In general, at which stage are most consumers when managing their health information? Select up to 3 answers.

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