Amy Finkelstein,a PhD economist from MIT,has "discovered" that people when given a card that lets them buy something cheaper than they could otherwise buy more stuff. Thanks Dr. Michel Accad at the blog, Alert and Oriented,for calling this discovery to my attention.
This link from a news story on the discovery briefly discusses her findings and the mind boggling claim that this finding will change thinking about health care spending. Yeah, it is that old
"demand curves slope downward" thing again. Note: this is not breaking news as her report and news items on it date back to 2007 but I have fallen way behind on my health wonk literature reading.
Here is a quote from the news report:
Already, Finkelstein's analysis is shaking up views across the political spectrum. "This is pathbreaking work," says Joseph R. Antos, a health economist at the conservative American Enterprise Institute. Adds the more liberal MIT economist Jonathan Gruber: "This really changes the whole landscape in the way we think about health economics."
Wow! The economist ( Gruber) who advised in regard to Romney-care and Obamacare seemingly was unaware that people tend to buy more of something when it costs less.
Wow again, path-breaking work.Apparently no one heard or remembered what Milton Friedman had said about the ways people can spend.See here for that concept in Dr.Friedman's own words.The key point here is that when you spend someone else's money on yourself , you are not very careful about how much you spend.
Dr. Finkelstein work supports the notion that health care costs have increased in no small measure because millions of older American have Medicare insurance and they realize that they can get medical services much cheaper than otherwise when they show their card to various health care providers. The fact that some health care wonks thought her findings will change the way people will think about health care policy seems to mean that until now some health care experts believed that demand curves slope upward. Some admirers of Milton Friedman are celebrating the 99th anniversary of his birth. See here. Maybe health care economists might browse through some of his work.Perhaps an econometric demonstration of the absence of a free lunch might be forthcoming.
Addendum: 11/12/14 Minor changes made re style , spelling and one factual error in regard to Dr. Accad's first name.
Monday, August 01, 2011
Thursday, July 28, 2011
Health Care and Education-the new "commanding heights -"Kling and Schult
An interesting and insightful commentary by Arnold Kling and Mick Schult is found in the Summer issue of "National Affairs" and is entitled "The New Commanding Heights".The title is a play on the title of the book by Daniel Yergin and Joseph Stanislaw "entitled "The Commanding Heights:The battle for the world economy". See here for the Kling essay.
The term Commanding Heights was used by Lenin in a 1922 speech in which he refers to the dominate industries in Russia at the time indicating that they would be target of the central control of the communists. He gave up trying to control everything so he decided to control the key industries.These included heavy manufacturing,mining,electric generation and transportation.
Kling and Schult contend that those industries are now largely not controlled by the state in the United States and in western countries generally and while these sectors are important they present data showing they are no longer the major growth sectors in our economy.They argue convincingly that education and health care are the growth sectors in the United States.
History has made it clear that markets work. Market economies lead to prosperity,economic growth and innovation while central planning results in dismal and often tragic failures. Lenin promised to do what capitalism did plus eliminating waste, recessions, and inequality:what was produced was mass starvation and mass murder.
However, the authors warn markets advocates against premature celebration. Their thesis is that in the U.S., both in education and medical care, the new commanding heights, governmental controls are prevalent and growing and if the U.S. is to continues to grow and prosper, we need innovation in these areas? How much innovation occurs in government controlled economic sector?
Many (most?) discussions of the medical economy emphasize the overall
cost" of medical care and its growth ( it is a growth sector) and that it is a bad thing. Two comments are appropriate: 1) often overall costs are conflated with government costs ( i.e. Medicare and Medicaid) with overall costs 2) Costs are only one side of the accounting, one person's costs are another's income stream.
Controlling the amount of money that the government spends on health care or farm subsidies or foreign wars is one thing and is well within legitimate government activity, attempting to limit private spending on healthcare or cosmetics or anything other legal activity is quite something else.So with GDP not snapping back to previous more healthy levels do we really want to decrease activity in one of the two major economic growth centers?
The term Commanding Heights was used by Lenin in a 1922 speech in which he refers to the dominate industries in Russia at the time indicating that they would be target of the central control of the communists. He gave up trying to control everything so he decided to control the key industries.These included heavy manufacturing,mining,electric generation and transportation.
Kling and Schult contend that those industries are now largely not controlled by the state in the United States and in western countries generally and while these sectors are important they present data showing they are no longer the major growth sectors in our economy.They argue convincingly that education and health care are the growth sectors in the United States.
History has made it clear that markets work. Market economies lead to prosperity,economic growth and innovation while central planning results in dismal and often tragic failures. Lenin promised to do what capitalism did plus eliminating waste, recessions, and inequality:what was produced was mass starvation and mass murder.
However, the authors warn markets advocates against premature celebration. Their thesis is that in the U.S., both in education and medical care, the new commanding heights, governmental controls are prevalent and growing and if the U.S. is to continues to grow and prosper, we need innovation in these areas? How much innovation occurs in government controlled economic sector?
Many (most?) discussions of the medical economy emphasize the overall
cost" of medical care and its growth ( it is a growth sector) and that it is a bad thing. Two comments are appropriate: 1) often overall costs are conflated with government costs ( i.e. Medicare and Medicaid) with overall costs 2) Costs are only one side of the accounting, one person's costs are another's income stream.
Controlling the amount of money that the government spends on health care or farm subsidies or foreign wars is one thing and is well within legitimate government activity, attempting to limit private spending on healthcare or cosmetics or anything other legal activity is quite something else.So with GDP not snapping back to previous more healthy levels do we really want to decrease activity in one of the two major economic growth centers?
Wednesday, July 20, 2011
Surprise-economic principles apply to old folks and Medicare costs
See here for a report on some data gathering that should be filed under the heading of "very bloody obvious". The link is to the 7/16/2011 blog entry from Dr. Mark J.Perry which tells us 1)Medicare utilization is about 50% higher than private health insurance utilization and 2) why Medicare patients see their doctor so (too?) much. Hint:it has something to do with spending someone's else money and the law of demand.
Economists are fond of saying "demand curves slope downward" which is their jargony way of saying that people buy more when the prices is lower and less when it is higher. Milton Friedman has been quoted as saying that economics is simple- just remember there is no free lunch and demand curves slope downward.
Economists ,for some obscure reason possibly found deep in the history of their discipline, place the dependent variables on the X-axis and the independent variable on the Y-axis. This is just the reverse of the practice of physicists and engineers and most other people who like to draw graphs. So they place price on the Y axis and quantity demanded on the X axis and thus the demand curves slope downward because folks buy more when the price is cheaper.
Medicare patients "buy" more health care because of the way Medicare works they get a really good deal on the price that CMS allows to be charged. It gets better, Medicare generally pay 80% of a significantly lower "allowed price" and many seniors have supplemental insurance which further amplifies the illusion of a free lunch.So,of course,Medicare users utilize more services and the reason is not that fee-for-service doesn't work. Blaming fee-for-service is the current battle cry on many in Congress and many of the organizations who allegedly represent the practicing physicians.
Some would conflate fee-for-service with free markets in medicine but there has been no free market in medical care for many years now (except for a few markets such as lasik surgery and some plastic surgery and much of alternative medicine) and the Medicare system is characterized by price controls and the demand side characterized by folks buying services with someone else's money,both of which are the products of central planning. What could possibly go wrong with that circumstance?
The list of problems in medical practice are not due to fee-for-service but rather what happens in a nominal fee-for-service setting when there are price controls namely shortages,long waiting lines,poor quality and various other forms of rationing by other than prices.As is often the case, the results of central planning are blamed on that heartless,run-away greed all the way down, free market.And as is also often the case the solution is more central planning,which is what Obama care is all about.
Economists are fond of saying "demand curves slope downward" which is their jargony way of saying that people buy more when the prices is lower and less when it is higher. Milton Friedman has been quoted as saying that economics is simple- just remember there is no free lunch and demand curves slope downward.
Economists ,for some obscure reason possibly found deep in the history of their discipline, place the dependent variables on the X-axis and the independent variable on the Y-axis. This is just the reverse of the practice of physicists and engineers and most other people who like to draw graphs. So they place price on the Y axis and quantity demanded on the X axis and thus the demand curves slope downward because folks buy more when the price is cheaper.
Medicare patients "buy" more health care because of the way Medicare works they get a really good deal on the price that CMS allows to be charged. It gets better, Medicare generally pay 80% of a significantly lower "allowed price" and many seniors have supplemental insurance which further amplifies the illusion of a free lunch.So,of course,Medicare users utilize more services and the reason is not that fee-for-service doesn't work. Blaming fee-for-service is the current battle cry on many in Congress and many of the organizations who allegedly represent the practicing physicians.
Some would conflate fee-for-service with free markets in medicine but there has been no free market in medical care for many years now (except for a few markets such as lasik surgery and some plastic surgery and much of alternative medicine) and the Medicare system is characterized by price controls and the demand side characterized by folks buying services with someone else's money,both of which are the products of central planning. What could possibly go wrong with that circumstance?
The list of problems in medical practice are not due to fee-for-service but rather what happens in a nominal fee-for-service setting when there are price controls namely shortages,long waiting lines,poor quality and various other forms of rationing by other than prices.As is often the case, the results of central planning are blamed on that heartless,run-away greed all the way down, free market.And as is also often the case the solution is more central planning,which is what Obama care is all about.
Thursday, July 14, 2011
More on IPAB and the risk of regulatory capture
See here for a recent report on views of the IPAB.
Particularly interesting were comments of someone who has been there and done things in the setting of a very important and powerful governmental appointed post.
Bruce Vladecks, the former head of CMS under Bill Clinton, had this to say :
"In the short term, it might theoretically work," he said. But the history with other independent regulatory agencies, like the Interstate Commerce Commission and the Civil Aeronautics Board is that over time "the regulated industries tend to capture them; and they tend to do more to protect the regulated industries than they do to protect consumers."
Considering the legislative hurdles that Obamacare put in place for Congress to over ride the edicts of IPAB, capturing IPAB would be prize well worth capturing.
Particularly interesting were comments of someone who has been there and done things in the setting of a very important and powerful governmental appointed post.
Bruce Vladecks, the former head of CMS under Bill Clinton, had this to say :
"In the short term, it might theoretically work," he said. But the history with other independent regulatory agencies, like the Interstate Commerce Commission and the Civil Aeronautics Board is that over time "the regulated industries tend to capture them; and they tend to do more to protect the regulated industries than they do to protect consumers."
Considering the legislative hurdles that Obamacare put in place for Congress to over ride the edicts of IPAB, capturing IPAB would be prize well worth capturing.
Monday, July 11, 2011
What is the moral case for Obamacare?
Is there one at all?This commentary by the economist John Goodman argues there is none. After Dr.Goodman made his case he invited readers to offer such a moral justification.I could find none in the forty reply to his article.
Several commentators ( including spokesmen for the ACP and the AMA ) claimed that Obamacare furthered social justice. So could that be the moral justification for Obamcare?
In regard to social justice Thomas Sowell said the following:
Their passionate arguments for particular results tend to obscure or distract attention from the question of the social processes by which these hoped-for results are to be pursued.
Goodman,in this most recent cited commentary, and in numerous others posting on his blog gives great detail of the various social process set in motion by Obamacare and the numerous apparently unintended consequences
In short, the various elements of this outlandish long bill do just about anything other than the putative hoped-for results which is "affordable , accessible health care for all" and instead offer a mind boggling array of counterproductive results and bizarre inequities and the frightening promise that many more such dystopian outcomes will arise from the hundreds ( more likely thousands) of pages yet to be written by agencies created by Obamacare and the incredible discretionary powers given to the Secretary of HHS.
Perhaps,spokesmen for the medical organizations who champion (yes, they still support it in spite of the increasing evidence that the bill is a very bad idea) can offer a moral justification .
Several commentators ( including spokesmen for the ACP and the AMA ) claimed that Obamacare furthered social justice. So could that be the moral justification for Obamcare?
In regard to social justice Thomas Sowell said the following:
Their passionate arguments for particular results tend to obscure or distract attention from the question of the social processes by which these hoped-for results are to be pursued.
Goodman,in this most recent cited commentary, and in numerous others posting on his blog gives great detail of the various social process set in motion by Obamacare and the numerous apparently unintended consequences
In short, the various elements of this outlandish long bill do just about anything other than the putative hoped-for results which is "affordable , accessible health care for all" and instead offer a mind boggling array of counterproductive results and bizarre inequities and the frightening promise that many more such dystopian outcomes will arise from the hundreds ( more likely thousands) of pages yet to be written by agencies created by Obamacare and the incredible discretionary powers given to the Secretary of HHS.
Perhaps,spokesmen for the medical organizations who champion (yes, they still support it in spite of the increasing evidence that the bill is a very bad idea) can offer a moral justification .
Sunday, July 10, 2011
Meta-analyses-money well spent?
I have blogged more than once ( see here and here )about meta-analyses (MA) and quoted Steve Goodman MD PhD more than once when he said that MAs are just observational studies in which the observed elements are studies. I would add and we just don't know what went on behind the curtain.
They are not super randomized trials as the prefix "meta" might imply but should rightly reside significantly under RCTs in the hierarchy of clinical research methods.
Since the views expressed conform nicely with my biases I was drawn to this commentary by Dr Wes.
They are not super randomized trials as the prefix "meta" might imply but should rightly reside significantly under RCTs in the hierarchy of clinical research methods.
Since the views expressed conform nicely with my biases I was drawn to this commentary by Dr Wes.
Friday, July 08, 2011
"Wise Legislators " pass ACA with IPAB,their "good deed"
Henry J.Aaron,of the Brookings Institute, has written three commentaries in the Perspective section of the NEJM in the last year. He seems to be their go-to guy for IPAB issues.Here is a link to his latest.
He praises Congress for their willingness to "abstain from meddling in matters they are poorly equipped to handle." He seems to be aware of Public Choice theory (he has a PhD in Economics from Harvard) when he talks about the temptation of Congress to spend money for political ends but seems to have missed the point when he apparently assumes that the IPAB panelists would be immune to lobbying efforts.Clearly, he believes it is a good and desirable thing for Congress to delegate its powers to agencies and other bodies- a view somewhat in opposition to how James Madison thought things would work out.
This is in stark contrast with the friend of the court brief that the Pacific Legal Foundation has filed to challenge the constitutionality of the creation of IPAB. See here for their comments on IPAB and a reference link to their brief challenging IPAB.
Aarons likens the creation of IPAB to the creation of the Federal Reserve which was to be an entity not subject to congressional control.
This may not be the best analogy with the increasing efforts of Congress (and not just Ron Paul ) to at least exert some surveillance of what the Fed does.
He praises Congress for their willingness to "abstain from meddling in matters they are poorly equipped to handle." He seems to be aware of Public Choice theory (he has a PhD in Economics from Harvard) when he talks about the temptation of Congress to spend money for political ends but seems to have missed the point when he apparently assumes that the IPAB panelists would be immune to lobbying efforts.Clearly, he believes it is a good and desirable thing for Congress to delegate its powers to agencies and other bodies- a view somewhat in opposition to how James Madison thought things would work out.
This is in stark contrast with the friend of the court brief that the Pacific Legal Foundation has filed to challenge the constitutionality of the creation of IPAB. See here for their comments on IPAB and a reference link to their brief challenging IPAB.
Aarons likens the creation of IPAB to the creation of the Federal Reserve which was to be an entity not subject to congressional control.
This may not be the best analogy with the increasing efforts of Congress (and not just Ron Paul ) to at least exert some surveillance of what the Fed does.
Monday, July 04, 2011
July 4th, all about the right to vote or much more than that?
This commentary from the Coyote Blog is good fourth of July reading.
Warren Meyer,a libertarian entrepreneur and prolific writer, who writes the blog as well as being a contributor to Forbes list three principles more important than the right to vote. Here is the first one he discusses:
"The Rule of Law. For about 99% of human history, political power has been exercised at the unchecked capricious whim of a few individuals. The great innovation of western countries like the US, and before it England and the Netherlands, has been to subjugate the power of government officials to the rule of law. Criminal justice, adjudication of disputes, contracts, etc. all operate based on a set of laws known to all in advance and applying equally to all."
Meyer then points out the obvious contempt for the rule of law with the exemptions to certain provisions of the health care law .
Warren Meyer,a libertarian entrepreneur and prolific writer, who writes the blog as well as being a contributor to Forbes list three principles more important than the right to vote. Here is the first one he discusses:
"The Rule of Law. For about 99% of human history, political power has been exercised at the unchecked capricious whim of a few individuals. The great innovation of western countries like the US, and before it England and the Netherlands, has been to subjugate the power of government officials to the rule of law. Criminal justice, adjudication of disputes, contracts, etc. all operate based on a set of laws known to all in advance and applying equally to all."
Meyer then points out the obvious contempt for the rule of law with the exemptions to certain provisions of the health care law .
Sunday, July 03, 2011
More of the "social justice" fallout from ACA
As more and more inequities and unintended consequences of Obamacare are revealed as we learn more and more about the bill,we can see that the social justice Obamacare advocates (you know who you are )boasted about following its passage is a very strange type of justice.
See here for one of the latest revelations about how basically unfair various aspects of the bill turn out to to be. As the AP article explains two families with same income would pay significantly different health insurance premiums to the exchange based on what type of income they receive.This problem seems to be tied to the definition of income used in the statute.
But it gets even worse, more folks become eligible for Medicaid based on the law's wording.
See here for one of the latest revelations about how basically unfair various aspects of the bill turn out to to be. As the AP article explains two families with same income would pay significantly different health insurance premiums to the exchange based on what type of income they receive.This problem seems to be tied to the definition of income used in the statute.
But it gets even worse, more folks become eligible for Medicaid based on the law's wording.
Medicare's top number-cruncher is warning that up to 3 million middle-class people in households that get at least part of their income from Social Security could suddenly become eligible for nearly free coverage through Medicaid, the federal-state safety net program for the poor. Chief Actuary Richard Fosters says that situation "just doesn't make sense."
The progressive mind set worries about inequality just about everywhere
See here for David Henderson's remarks about a commentary from former white house adviser and Director of OMB and now VP of global banking at Goldman Sachs.Peter Orszag.
Here,Orszag worries that high tech advances will worsen the gap between the rich and poor in longevity. The various (endless?) parameters that can be used to illustrate the fact that the rich and the poor are different is many ways provide much source of professed worry and endless calls to action from the progressives.
His move to Goldman Sacs should do much to insure that he will be at the top of that gap so that any "solution" to this problem must involve raising up the poor and not lowering the rich although his commentary seemed to offer no practical solution to this worrisome gap .
We will never run out of gaps.Market economics is the engine of prosperity and also the engine of inequality according to Milton Friedman.
There is a body of literature and discourse which emphasizes the notion that inequality is a major problem in the western world, as least in the U.S., and the inequality per se is bad and harmful and therefore there should be continuing policy efforts to shrink the gaps. Here is a well reasoned counterargument to that notion.
Here,Orszag worries that high tech advances will worsen the gap between the rich and poor in longevity. The various (endless?) parameters that can be used to illustrate the fact that the rich and the poor are different is many ways provide much source of professed worry and endless calls to action from the progressives.
His move to Goldman Sacs should do much to insure that he will be at the top of that gap so that any "solution" to this problem must involve raising up the poor and not lowering the rich although his commentary seemed to offer no practical solution to this worrisome gap .
We will never run out of gaps.Market economics is the engine of prosperity and also the engine of inequality according to Milton Friedman.
There is a body of literature and discourse which emphasizes the notion that inequality is a major problem in the western world, as least in the U.S., and the inequality per se is bad and harmful and therefore there should be continuing policy efforts to shrink the gaps. Here is a well reasoned counterargument to that notion.
Wednesday, June 22, 2011
Platonic Medicine and the ACA with its IPAB
A recent commentary by one of favorite bloggers,Dr. Robert Centor, spoke favorably about IPAB, one of many,many provisions of ACA.See here.I made a brief reply to his entry. I recalled this earlier blog entry and if Dr.Centor's comment stirs up much furor I want to add this earlier blog post to the kerfuffle.Originally published 6/22/11 and now submitted with little editing.
I had been sketching out some comments about what I was going to call "Platonic Medicine" referring to the "leaders with ideas" who will lead the way to transform medicine based on the underlying premise that "medicine is too complex and important to be left to the individual physician and the individual patient" and therefore it should be controlled and directed by the wise medical elite who will determine the collective utility of a given approach and its value.I have commented before about Don Berwick's advocacy of that view.
However, someone had written something in that regard better than I could.See here.
Hat tip to the Pacific Legal Foundation who filed a friend-of-the-court brief to challenge the constitutionality of IPAB on the grounds of violation of the non-delegation doctrine and for the above mentioned link which alerted me to Jost's frightening comments.
It turns out that an outspoken advocate and supporter of Obamacare,law professor, Timothy Jost has already praised that legislative act in part because of what the IPAB will provide. He said:
A board of “Platonic Guardians” to govern the health care system or some aspects of it. The cost of health care is spinning dangerously out of control…. [O]ur traditional political institutions—Congress and the executive administrative agencies—are too driven by special interest politics and too limited in their expertise and vision to control costs. Enter the Platonic guardians…an impartial, independent board of experts who could make evidence-based policy determinations based purely on the basis of effectiveness and perhaps efficiency.
Incredibly Jost is asserting that this board will be immune to the influence of special interests and will make decisions rationally and in a proper evidence based manner.From what planet will these board member be chosen? Philosopher kings in charge,what could go wrong with that?
The PLF commentary pointed out that a Platonic government was definitely not what the founding fathers had in mind and Jefferson and associates were not big fans of Plato.
In the commentary that I was considering I thought perhaps calling the panel members Platonic Guardians would earn me the accusation of being overly dramatic and hyperbolic, but now we see an IPAB advocate using the same characterization and believing that to be a very good thing.
Dictating the coverage to control the cost for Medicare and Medicaid may not be enough for the medical Platonic elite as is illustrated by this quote from Dr. Robert Berenson:
"we ought to consider setting all payer-rates for providers." He continues "but the country's antigovernment mood renders such a discussion unlikely,at least for now".
I wonder who the "we" is that Berenson references.
Finally, another chilling quote from Mr. Jost:
"In the long run, Congress may not be able to cap Medicare expenditures without addressing private expenditures as well. If the IPAB opens the door to rate setting for all payers,it may well be the most revolutionary innovation of the ACA".
Yeah, it just might be.
Tuesday, June 21, 2011
Why is there a shortage of certain drugs?
When faced with a shortage in some good or services a good first 
guess as to what might be going on is to see if there are price controls at work?
Go here to read a detailed analysis by John Goodman of what factors are at work in the ongoing shortage of over 200 hundred medications. It turns out that at least a contributing factor to the shortage is price controls which are part of a 1992 Federal 340B drug rebate program to certain medical facilities.
Another, perhaps more important governmental factor is at work in the form of the the output controls put in place by the FDA which limits the production of product by drug companies and diminishes their ability to quickly react to market conditions with increased production.
No, price controls are not the entire explanation but government price controls and other regulatory actions impeding market process are playing a role. The situation is more complicated that the two factors mentioned above and some of the other contributing factors are discussed here. But,as the various shortages play out, I'll be it won't be long until we hear that the free market has failed again and more governmental controls are necessary to protect the public.
guess as to what might be going on is to see if there are price controls at work?Go here to read a detailed analysis by John Goodman of what factors are at work in the ongoing shortage of over 200 hundred medications. It turns out that at least a contributing factor to the shortage is price controls which are part of a 1992 Federal 340B drug rebate program to certain medical facilities.
Another, perhaps more important governmental factor is at work in the form of the the output controls put in place by the FDA which limits the production of product by drug companies and diminishes their ability to quickly react to market conditions with increased production.
No, price controls are not the entire explanation but government price controls and other regulatory actions impeding market process are playing a role. The situation is more complicated that the two factors mentioned above and some of the other contributing factors are discussed here. But,as the various shortages play out, I'll be it won't be long until we hear that the free market has failed again and more governmental controls are necessary to protect the public.
Friday, June 17, 2011
Peripheral arterial disease (PAD) and smoking, now there is a real relative risk
While I thought there was little doubt remaining about the relationship between cigarette smoking and PAD, a recent study published in the Annals of Internal Medicine (see here for abstract) provided more convincing data, this time in women. Yes, cigarettes are bad for women's peripheral arteries as well.
This study from the Women's Health Study generated some robust, relative risk numbers.I am not talking about the puny 1.2-1.4 relative risks (RRs) we often see in the typical data dredging articles and certainty not the ridiculous RR of 1.01 (not a typo) that was the alleged increased risk of death from vitamin E use.See here for that silliness.
Here are the age adjusted incidence numbers for symptomatic PAD
0.12 never smoked
0.34 former smoker
0.45 smoked less than 15 cigarettes per day
1.63 smoked greater than 15 cigarettes per day
1.63/0.12 =13.6
You are not likely to see RRs greater 10 from the typical data dredge and the WHS data also demonstrated a dose-response effect.
So, how large should a RR be before one worries about it or seriously believes we may have a causal relationship?
Sackett ,of McMaster EBM fame, asked one of the giants of epidemiology that question. Sir Richard Doll said that if the RR were 20 or greater that would be almost sufficient to indicate causality.Sackett was not quite that cautious and indicated that a RR of greater than 3 was "convincing".
Some courts use a RR greater than 2 to reach the threshold of "more likely than not".This is the current level of proof in most tort cases.
Michale Thun, who at the time was vice-president of epidemiology and Surveillance at the American Cancer Society, said:
With epidemiology you can tell a little thing from a big thing.What's very hard to do it to tell a little thing from nothing at all.
With cigarettes and PAD, we have big thing and we will not likely see battling statisticians debating the data. However, we did see that when Nissen's NEJM article claimed a RR of 1.43 for of Avandia and heart disease and we will likely get to see another again with the current breaking news of a RR around 1.4 with Actos and bladder cancer.
This study from the Women's Health Study generated some robust, relative risk numbers.I am not talking about the puny 1.2-1.4 relative risks (RRs) we often see in the typical data dredging articles and certainty not the ridiculous RR of 1.01 (not a typo) that was the alleged increased risk of death from vitamin E use.See here for that silliness.
Here are the age adjusted incidence numbers for symptomatic PAD
0.12 never smoked
0.34 former smoker
0.45 smoked less than 15 cigarettes per day
1.63 smoked greater than 15 cigarettes per day
1.63/0.12 =13.6
You are not likely to see RRs greater 10 from the typical data dredge and the WHS data also demonstrated a dose-response effect.
So, how large should a RR be before one worries about it or seriously believes we may have a causal relationship?
Sackett ,of McMaster EBM fame, asked one of the giants of epidemiology that question. Sir Richard Doll said that if the RR were 20 or greater that would be almost sufficient to indicate causality.Sackett was not quite that cautious and indicated that a RR of greater than 3 was "convincing".
Some courts use a RR greater than 2 to reach the threshold of "more likely than not".This is the current level of proof in most tort cases.
Michale Thun, who at the time was vice-president of epidemiology and Surveillance at the American Cancer Society, said:
With epidemiology you can tell a little thing from a big thing.What's very hard to do it to tell a little thing from nothing at all.
With cigarettes and PAD, we have big thing and we will not likely see battling statisticians debating the data. However, we did see that when Nissen's NEJM article claimed a RR of 1.43 for of Avandia and heart disease and we will likely get to see another again with the current breaking news of a RR around 1.4 with Actos and bladder cancer.
Tuesday, June 14, 2011
Independent Payment Advisory Board (IPAB)-what could go wrong with that?
The IPAB which was inserted into Obamacare at the last minute without anything approaching proper legislative review and contemplation establishes a 15 member panel appointed by the President which will beginning in 2014 ( if a cost limit trigger is met) have unprecedented power to control medical spending in the country with almost no significant or likely effective congressional oversight.
Now what could possibly be wrong with that?
James Madison had some thoughts about that.He was concerned about what he referred to as "factions' which today would be thought of as special interest groups.Special interest groups have developed a potent skill set to influence government bodies to focus benefits on themselves while the cost are diffused.
In general, the founding fathers of the country has some thoughts about what could be wrong with that sort of entity.They tried to design a government not so that wise leaders could do great good but rather one that would limit the damage done by fools,thugs and would be despots who might(most assuredly would) find their way to influential posts in government.
Their wisdom seemed brushed aside as the view of a benevolent and wise government assumed the default position as it was persistently promoted by a cadre of progressive minded academia intellectuals and high school civics texts which visualized a government that would wisely recognize problems,devise safe and effective solutions and then without special favors execute remedial plans marvelously bereft of significant unintended consequences.
Fortunately, James Buchanan and Gordon Tullock resurrected Madisonian wisdom, enlarged upon it and explicated the theory of public choice which basically asserts that government officials and bureaucrats display the same characteristics as other humans, namely a proclivity to look after their own self interest. They definitely had some thoughts about what could possibly go wrong with something like IPAB.
The economist, George Stigler,who did much to develop the concept of regulatory capture might have some to say about what could go wrong with the IPAB.Governmental agencies and organizations can be subject to the influence of the very groups that they are nominally created to regulate and control .
Mafia dons and wise guys alike know the explanatory value of the "follow the money" and could explain simply what could go wrong with the IPAB.
Big Pharma had supported the passage of ACA but it is hard to believe that their support would have been forthcoming had they realized what IPAB would be.They certainly recognize the danger now.
The American College of Physicians (ACP) also supported Obamacare but now express opposition to the IPAB section "as written".Although (unfortunately in my view) they do not recommend repeal of IPAB but instead want certain changes that would make the entity acceptable.See here for ACP's position which objects to the exemption of hospitals and hospices from IPAB's edicts until 2019,the absence of primary care physicians on the panel,the lack of a mechanisms for significant congressional oversight and for preserving quality while decreasing costs.
So, much can go very,very wrong with IPAB but it gets even worse. Go here to read a recent commentary by George Will which discusses the chilling thought that the IPAB may not be stoppable. It may well be " entrenched".
Entrenchment refers to one legislative body passing a law that contains provisions that prohibit later legislatures from repealing the law.
Can a legislative body really pass a law that contains a wording to prohibit further changes in that law?Is the IMAB really an immutable entity?
Eric Posner discusses it here and, as best I can translate it from the legal dialect academic lawyers speak into everyday English is that the Supreme Court has decided that they cannot allow that but as with anything that might be litigated there are at least as many sides to the issue as there are interests who can loose or gain from a decision and Supreme Courts sometimes change its mind.
It is hard to find a better summation that the one penned by Mr. Will in his above cited recent column:
"The essence of progressivism, and of the administrative state that is progressivism’s project, is this doctrine: Modern society is too complex for popular sovereignty, so government of, by and for supposedly disinterested experts must not perish from the earth. "
And the corollary for progressive medicine is that "medical care is too important and complex to be left to the individual physician and the individual patient."
minor editorial changes and typo correction changes made 8/17/14.
more corrections made 11/29/14
Now what could possibly be wrong with that?
James Madison had some thoughts about that.He was concerned about what he referred to as "factions' which today would be thought of as special interest groups.Special interest groups have developed a potent skill set to influence government bodies to focus benefits on themselves while the cost are diffused.
In general, the founding fathers of the country has some thoughts about what could be wrong with that sort of entity.They tried to design a government not so that wise leaders could do great good but rather one that would limit the damage done by fools,thugs and would be despots who might(most assuredly would) find their way to influential posts in government.
Their wisdom seemed brushed aside as the view of a benevolent and wise government assumed the default position as it was persistently promoted by a cadre of progressive minded academia intellectuals and high school civics texts which visualized a government that would wisely recognize problems,devise safe and effective solutions and then without special favors execute remedial plans marvelously bereft of significant unintended consequences.
Fortunately, James Buchanan and Gordon Tullock resurrected Madisonian wisdom, enlarged upon it and explicated the theory of public choice which basically asserts that government officials and bureaucrats display the same characteristics as other humans, namely a proclivity to look after their own self interest. They definitely had some thoughts about what could possibly go wrong with something like IPAB.
The economist, George Stigler,who did much to develop the concept of regulatory capture might have some to say about what could go wrong with the IPAB.Governmental agencies and organizations can be subject to the influence of the very groups that they are nominally created to regulate and control .
Mafia dons and wise guys alike know the explanatory value of the "follow the money" and could explain simply what could go wrong with the IPAB.
Big Pharma had supported the passage of ACA but it is hard to believe that their support would have been forthcoming had they realized what IPAB would be.They certainly recognize the danger now.
The American College of Physicians (ACP) also supported Obamacare but now express opposition to the IPAB section "as written".Although (unfortunately in my view) they do not recommend repeal of IPAB but instead want certain changes that would make the entity acceptable.See here for ACP's position which objects to the exemption of hospitals and hospices from IPAB's edicts until 2019,the absence of primary care physicians on the panel,the lack of a mechanisms for significant congressional oversight and for preserving quality while decreasing costs.
So, much can go very,very wrong with IPAB but it gets even worse. Go here to read a recent commentary by George Will which discusses the chilling thought that the IPAB may not be stoppable. It may well be " entrenched".
Entrenchment refers to one legislative body passing a law that contains provisions that prohibit later legislatures from repealing the law.
Can a legislative body really pass a law that contains a wording to prohibit further changes in that law?Is the IMAB really an immutable entity?
Eric Posner discusses it here and, as best I can translate it from the legal dialect academic lawyers speak into everyday English is that the Supreme Court has decided that they cannot allow that but as with anything that might be litigated there are at least as many sides to the issue as there are interests who can loose or gain from a decision and Supreme Courts sometimes change its mind.
It is hard to find a better summation that the one penned by Mr. Will in his above cited recent column:
"The essence of progressivism, and of the administrative state that is progressivism’s project, is this doctrine: Modern society is too complex for popular sovereignty, so government of, by and for supposedly disinterested experts must not perish from the earth. "
And the corollary for progressive medicine is that "medical care is too important and complex to be left to the individual physician and the individual patient."
minor editorial changes and typo correction changes made 8/17/14.
more corrections made 11/29/14
Sunday, June 12, 2011
Harvard economist expresses concern over plans for IPAB
When a main-stream, Harvard economist expresses concern about a entity created by the enormous health care bill (ACA,Obamacare) known as the IPAB, it should evoke more wide spread concern about the wide reaching aspects of the legislation.
Professor Greg Mankiw has written with alarm about what a progressive think tank has proposed regarding the IPAB. See here for his commentary but I believe there is more to worry about than a proposal in regard to the IPAB. Mankiw references a proposal by the Liberal Center for American Progress to allow the IPAB to control the expenditures of private health insurance plans not just those expenditures regarding Medicare and Medicaid.
From what I understand the IPAB already has been given that power by Obamacare.
Dr.Richard Fogoros writing in his blog The Covert Rationing Blog explains how the IPAB was created and what it is authorized to do beginning in 2014. His reading of the statute indicates that this presidential appointed panel already has the legislative authority to limit expenditures by private health insurance companies. His analysis also describes how difficult it will be for Congress to over ride the panel's edicts. See here for his comments.
Professor Greg Mankiw has written with alarm about what a progressive think tank has proposed regarding the IPAB. See here for his commentary but I believe there is more to worry about than a proposal in regard to the IPAB. Mankiw references a proposal by the Liberal Center for American Progress to allow the IPAB to control the expenditures of private health insurance plans not just those expenditures regarding Medicare and Medicaid.
From what I understand the IPAB already has been given that power by Obamacare.
Dr.Richard Fogoros writing in his blog The Covert Rationing Blog explains how the IPAB was created and what it is authorized to do beginning in 2014. His reading of the statute indicates that this presidential appointed panel already has the legislative authority to limit expenditures by private health insurance companies. His analysis also describes how difficult it will be for Congress to over ride the panel's edicts. See here for his comments.
Thursday, June 02, 2011
Remember the notion that "more [medical care] is less " and harmful as well -Guess what
Dr. Buz Cooper sticks a dagger in the heart of the non-sense that claims more medical care is harmful and less care is better. See here for his take on the latest study from the Dartmouth group which seems to contradict the mantra they have been selling to the gullible and to the progressive planners for years.
Dr. Cooper sums it up this way:
"Medicare beneficiaries who received more medical care had better outcomes, even when they are sicker. MORE was MORE."
Isn't this what common sense would suggest?
Dr. Cooper sums it up this way:
"Medicare beneficiaries who received more medical care had better outcomes, even when they are sicker. MORE was MORE."
Isn't this what common sense would suggest?
Tuesday, May 31, 2011
Being a (public health) expert means never having to say you are sorry
One of the continuing pleasures of following and sometimes participating in the world of medical blogging is the enjoyment of watching some bloggers who regularly hit things out of the park. I am thinking particularly about DrRich (aka Dr Richard Fogoros of the blog " the covert rationing blog") and his recent commentary about public health efforts that go wrong,sometimes badly so,and how the experts cram their previous advice down the memory hole and go on with their latest recommendations . See here for his latest and then here for an earlier spot-on critique of our public health brothers and their follies .
Public health experts enjoy a decision making advantage over the medical doctor who has to often take aggregate data-such as randomized clinical trials but often less reliable data) and then attempt to apply that to the individual patients sitting in his office.All the public health expert has to do is to look at the aggregate data and base recommendations on that while the practicing physician realizes that lying under the summary statistics are individual patients some of whom may will benefit from the proposed treatment while others are unaffected and still others are harmed. Life in the dealing with real patient trenches is more complicated ,nuanced and reality based than in the offices of the academic public health experts who can base their conclusions and recommendation on the utilitarian imperative .
DrRich talks about public health experts " displaying every ounce of the overblown self-confidence traditionally enjoyed by the expert class operating within our Progressive
institutions "
The public health experts share the following view with " leaders with ideas " who vie for the position of architect in the redoing of American health care :
The basic tenet of what I call the medical progressive is that:
health care is too important (and too complicated) to be left to the individual physician and her patient.
"..to demonstrate to men how little they really know about what they imagine they can design.
This F.A.Hayek's quote was directed to the central planners who believed they could control an economy from a governmental perch and did not need the knowledge derived from competition of a price driven market.The problem of knowing what and how much everyone should and should not eat is of a different sort but Hayek's words can function as a much needed counterpoint to their hubris .
Public health experts enjoy a decision making advantage over the medical doctor who has to often take aggregate data-such as randomized clinical trials but often less reliable data) and then attempt to apply that to the individual patients sitting in his office.All the public health expert has to do is to look at the aggregate data and base recommendations on that while the practicing physician realizes that lying under the summary statistics are individual patients some of whom may will benefit from the proposed treatment while others are unaffected and still others are harmed. Life in the dealing with real patient trenches is more complicated ,nuanced and reality based than in the offices of the academic public health experts who can base their conclusions and recommendation on the utilitarian imperative .
DrRich talks about public health experts " displaying every ounce of the overblown self-confidence traditionally enjoyed by the expert class operating within our Progressive
institutions "
The public health experts share the following view with " leaders with ideas " who vie for the position of architect in the redoing of American health care :
The basic tenet of what I call the medical progressive is that:
health care is too important (and too complicated) to be left to the individual physician and her patient.
"..to demonstrate to men how little they really know about what they imagine they can design.
This F.A.Hayek's quote was directed to the central planners who believed they could control an economy from a governmental perch and did not need the knowledge derived from competition of a price driven market.The problem of knowing what and how much everyone should and should not eat is of a different sort but Hayek's words can function as a much needed counterpoint to their hubris .
Wednesday, May 25, 2011
Is WHO's "World Health report 2000" the worst study ever?
After reading the commentary (see here )by Dr. Scott W. Atlas I would give that publication my vote as the worst or darn close to it. Dr. Atlas is a Senior Fellow at the Hoover Institution and is chief of neuroradiology at the Stanford University Medical Center and has a long list of scientific publications to his credit.
It is amazing how often sound bites from that study are quoted not only by the main stream media but also recited as gospel by medical researchers often in the boiler plate introductions to what otherwise would legitimately pass for a scientific publication.
How many times have we been told that something must be done about the U.S. health care system because although the U.S. spends 16 % of its GDP on health care it ranks 37th (out 191 countries) in something the WHO staffers called "overall performance".
Dr. Atlas said the the WHO publication " ranked countries according to their alignment with a specific political and economic ideal-socialized medicine-and then claimed it was an objective measure of "quality" ".
Quality,which is always a usefully ambiguous concept, was in the view of the report's authors the degree to which a country had distributed wealth and centralized administration of health care.
Atlas explains that 62.5 % of the overall performance index created by the report to rank countries was an assessment of one particular concept of equality and not about health care outcomes at all.
Quoting Dr. Atlas :
In fact, World Health Report 2000 was an intellectual fraud of historic consequence—a profoundly deceptive document that is only marginally a measure of health-care performance at all.
Read Dr. Atlas's commentary for more details of the methods used by the WHO staffers to achieve this propaganda masterpiece. I expect politicians and policy wonks with a particular agenda to quote the WHO's factoids but it is embarrassing to see medical researchers use the bogus material from the report as fillers and appropriately politically correct genuflexions to the notion of social justice in their publications.
It is amazing how often sound bites from that study are quoted not only by the main stream media but also recited as gospel by medical researchers often in the boiler plate introductions to what otherwise would legitimately pass for a scientific publication.
How many times have we been told that something must be done about the U.S. health care system because although the U.S. spends 16 % of its GDP on health care it ranks 37th (out 191 countries) in something the WHO staffers called "overall performance".
Dr. Atlas said the the WHO publication " ranked countries according to their alignment with a specific political and economic ideal-socialized medicine-and then claimed it was an objective measure of "quality" ".
Quality,which is always a usefully ambiguous concept, was in the view of the report's authors the degree to which a country had distributed wealth and centralized administration of health care.
Atlas explains that 62.5 % of the overall performance index created by the report to rank countries was an assessment of one particular concept of equality and not about health care outcomes at all.
Quoting Dr. Atlas :
In fact, World Health Report 2000 was an intellectual fraud of historic consequence—a profoundly deceptive document that is only marginally a measure of health-care performance at all.
Read Dr. Atlas's commentary for more details of the methods used by the WHO staffers to achieve this propaganda masterpiece. I expect politicians and policy wonks with a particular agenda to quote the WHO's factoids but it is embarrassing to see medical researchers use the bogus material from the report as fillers and appropriately politically correct genuflexions to the notion of social justice in their publications.
Sunday, May 22, 2011
Can this really happen in the U.S.?
This commentary is fairly far afield from the areas of my usual writing but the facts are so egregious and frightening that I had to say something. The topic is civil forfeiture. I defer to the excellent commentary on this subject by one of my favorite writers,Dr. Donald Boudreaux who is trained in economics and the law having a PhD in the former and is teaching at George Mason University.See here.
The case he discusses and the subsequent decision of the Supreme Court can fairly be described as mind-boggling , the dictionary definition of which is "intellectually or emotionally overwhelming".
In regard to the case,Bennis versus Michigan,Boudreaux and his co-author, A.C. Pritchard, said in part the following:
[the Supreme Court's decision] allows government to impose huge costs on people never charged with criminal wrongdoing"
Those of us who,probably against all reason,still think that the Supreme Court will overturn Obamacare find little hope that the supremes will do the right thing after one reads their decision in this case.
A slightly positive note is this was a five to four decision by the court and one of the dissents was penned by Justice Kennedy who is generally thought to be the possible swing vote when the health care bill gets to the court. Maybe he will do the right thing again.
The case he discusses and the subsequent decision of the Supreme Court can fairly be described as mind-boggling , the dictionary definition of which is "intellectually or emotionally overwhelming".
In regard to the case,Bennis versus Michigan,Boudreaux and his co-author, A.C. Pritchard, said in part the following:
[the Supreme Court's decision] allows government to impose huge costs on people never charged with criminal wrongdoing"
Those of us who,probably against all reason,still think that the Supreme Court will overturn Obamacare find little hope that the supremes will do the right thing after one reads their decision in this case.
A slightly positive note is this was a five to four decision by the court and one of the dissents was penned by Justice Kennedy who is generally thought to be the possible swing vote when the health care bill gets to the court. Maybe he will do the right thing again.
Monday, May 16, 2011
Will the over crowded ERs generated by Obama care reflect social justice
As the facts continue to flow out of various analyses of Obamacare and we learn that it will not keep the nation from "going bankrupt"and (shockingly) it will actually cost money and that various elements of it have to be postponed or exemptions for certain provisions have to manufactured to avoid voter push back in 20122, advocates are running out of justifications and may have to fall back on their claim of furtherance of social justice.
Some Democratic Senators and several spokesmen for medical organizations risked shoulder injury so exuberant were their efforts at self congratulation when the bill was signed into law.To be able to discern what the results would be in a bill so long, dense and ambiguous regarding details would require analytic ability not yet achieved by any creature who evolved on this earth.In fact, the details of the bill had not yet been written as the particulars were in numerous instances delegated to government entities for rule making some of which were yet to be formed.
Down the road there will be a situation in which this justice will be quite visible.That will play out in the emergency rooms across the country. The rich and the poor alike, those with insurance cards and those without will wait together as increasingly overworked and overstressed ER docs ( and their physician extenders) try and cope with the infusion of 30 plus million more insurance card holders into the health care system. Everyone waiting together to be screened by the NP or PA or as things evoke a NP assistant will give a lovely portrait of the wisdom of the central plan for [almost] everyone having nominal access to medical care but operationally finding little of it.
Social justice typically means redistribution and accordingly to CMS czar Dr. Donald Berwick good medicine must mean redistribution . Easier access to health care will be redistributed and diluted so that everyone gets to wait and wait and everyone's quality of care goes south.
For those of us who hope that having a retainer doc will help, and I think it will, here is a sobering thought and something else to worry about. With more vertical integration of medical care and the latest acclaimed saviors of medicine (the ACOs) becoming prevalent and perhaps dominant, will independent retainer docs even be allowed to admit and treat patients in a hospital or will her patients also end up in the increasingly long lines in the ERAs and the retainer physician unable do anything about it.Is there really anyway to escape from the clutches of Obamacare? Will it all be up to Justice Kennedy? Will it even be possible (i.e. legal) for someone to purchase health care outside of the centrally planned system? If you have not worried about that issue before I suggest you visit this and other commentaries by DrRich.
Here is a commentary from NPR on what ER docs think will happen when millions ( about 34 million) of new folks get an insurance card to show the clerk in the ER. Let us see-increased demand and no significant increase in supply combined with the already in place price controls in Medicare just might mean shortages , long lines, and decreased quality of care.You think.
Some Democratic Senators and several spokesmen for medical organizations risked shoulder injury so exuberant were their efforts at self congratulation when the bill was signed into law.To be able to discern what the results would be in a bill so long, dense and ambiguous regarding details would require analytic ability not yet achieved by any creature who evolved on this earth.In fact, the details of the bill had not yet been written as the particulars were in numerous instances delegated to government entities for rule making some of which were yet to be formed.
Down the road there will be a situation in which this justice will be quite visible.That will play out in the emergency rooms across the country. The rich and the poor alike, those with insurance cards and those without will wait together as increasingly overworked and overstressed ER docs ( and their physician extenders) try and cope with the infusion of 30 plus million more insurance card holders into the health care system. Everyone waiting together to be screened by the NP or PA or as things evoke a NP assistant will give a lovely portrait of the wisdom of the central plan for [almost] everyone having nominal access to medical care but operationally finding little of it.
Social justice typically means redistribution and accordingly to CMS czar Dr. Donald Berwick good medicine must mean redistribution . Easier access to health care will be redistributed and diluted so that everyone gets to wait and wait and everyone's quality of care goes south.
For those of us who hope that having a retainer doc will help, and I think it will, here is a sobering thought and something else to worry about. With more vertical integration of medical care and the latest acclaimed saviors of medicine (the ACOs) becoming prevalent and perhaps dominant, will independent retainer docs even be allowed to admit and treat patients in a hospital or will her patients also end up in the increasingly long lines in the ERAs and the retainer physician unable do anything about it.Is there really anyway to escape from the clutches of Obamacare? Will it all be up to Justice Kennedy? Will it even be possible (i.e. legal) for someone to purchase health care outside of the centrally planned system? If you have not worried about that issue before I suggest you visit this and other commentaries by DrRich.
Here is a commentary from NPR on what ER docs think will happen when millions ( about 34 million) of new folks get an insurance card to show the clerk in the ER. Let us see-increased demand and no significant increase in supply combined with the already in place price controls in Medicare just might mean shortages , long lines, and decreased quality of care.You think.
Subscribe to:
Posts (Atom)