Healthcare costs -- the Brill article

[Alaska Darin]

Is that a Pavlovian response, or have you actually looked at the defense contractors' financial statements that prove their government connections give them a leg up on the rest of the industrial sector? I'm sure the folks at Grumman agree with your assertion that defense contractors are protected from creative destruction.

I don't think there's any question that defense contractors have a leg up. That doesn't make them immune to bad management or stupid decisions. They're also only as good as their customer, which tells a lot of the story.

[dayman]

Is that a Pavlovian response, or have you actually looked at the defense contractors' financial statements that prove their government connections give them a leg up on the rest of the industrial sector? I'm sure the folks at Grumman agree with your assertion that defense contractors are protected from creative destruction.

 

ex-generals on payrolls and powerful lobbying put them in one of the few categories of industry that can perpetuate their own artificial demand?

Edited March 5, 2013 by SameOldBills

[TPS]

 

Is that a Pavlovian response, or have you actually looked at the defense contractors' financial statements that prove their government connections give them a leg up on the rest of the industrial sector? I'm sure the folks at Grumman agree with your assertion that defense contractors are protected from creative destruction.

It's not a "leg up," it's symbiotic relationship that helps with survival. Mergers and concentrated industries are how capitalism works. Grumman didn't die.

 

In trying to characterize general trends or forces, there are always counter-examples. Like using Latvia as the poster child of austerity's success....

[dayman]

It's not a "leg up," it's symbiotic relationship that helps with survival. Mergers and concentrated industries are how capitalism works. Grumman didn't die.

 

In trying to characterize general trends or forces, there are always counter-examples. Like using Latvia as the poster child of austerity's success....

 

Incoming twitter fight

[Magox]

It's not a "leg up," it's symbiotic relationship that helps with survival. Mergers and concentrated industries are how capitalism works. Grumman didn't die.

 

In trying to characterize general trends or forces, there are always counter-examples. Like using Latvia as the poster child of austerity's success....

Fine, we'll just throw in Lithuania and Estonia while we're at it.

[3rdnlng]

Incoming twitter fight

 

Is that when two twits go at it? Let me be clear, I'm not calling GG a twit.

[GG]

I don't think there's any question that defense contractors have a leg up. That doesn't make them immune to bad management or stupid decisions. They're also only as good as their customer, which tells a lot of the story.

 

They do not have a leg up any more than any other company is answerable to its customer. And you are absolutely correct. Dealing with a dysfunctional customer leads to bad business practices, which leads to weak profits and extreme cases, bankruptcy. Defense contractors are not immune to the basic tenets of business, despite the myths.

 

And now on to :

 

It's not a "leg up," it's symbiotic relationship that helps with survival. Mergers and concentrated industries are how capitalism works. Grumman didn't die.

 

In trying to characterize general trends or forces, there are always counter-examples. Like using Latvia as the poster child of austerity's success....

 

If defense contractors have the power and strength you believe, that would show up in their outsized profits. Yet, Apple and Miscrosoft generate more cash than the entire global defense industry combined. Two companies vs an entire industry that has ungodly powers over capitalism. How does that happen?

 

Grumman didn't die because it recognized it couldn't compete and decided to sell. Otherwise it would have gone bankrupt eventually. And yes, M&A is a big cleansing process of capitalism. So exactly how are defense contractors not exposed to creative destruction? I didn't have to use Grumman. I could have used Morton Thiokol, or Martin Marrietta, or Singer Industries. Or BearingPoint, to show that defense contractors aren't limited to guys who make tanks, planes and rockets. There have been over 1,100 bankruptcies of government contractors since the '80s. I'm sure you're very familiar with Southern California's economic devastation in the early '90s with contractor retrenchment.

 

So, again, show me how defense contractors aren't subject to the same tectonic forces that constantly split capitalism apart and put it back together. You can write back in Latvian. I can understand.

Edited March 5, 2013 by GG

[OCinBuffalo]

did anybody notice the bit about employment opportunities and potential earnings for salesmen for items like mri machines for companies like seimens? these facts are emblematic of the problem to me. americans are effectively led to believe that more is always better even if there isn't evidence to support that contention.

 

if they don';t get more they feel they are being cheated.

I agree.

 

Dopes like you have been advocating for more government since before I was born. And what's worse? When dopes like you get shut down, lose elections, etc., what's the first thing you tell people to get back in power? You tell them they are being cheated, and, if they would only vote for your candidates, they would get more. Well, don't you?

 

Where is the evidence, given 70+ years of "more government is better" FAIL, that supports your contention?

 

Throughout the course of this post. I will examine your lack of evidence and highlight the contradictory evidence.

this is certainly the case for many radiologic studies.. these are profit centers for health systems and they seem happy to do as many studies as they can. doctors often do them out of fear of malpractice cases. in both cases, the root cause is the desire to make money off of the system. and plenty of people are making plenty of money that is not going towards providing effective care. this is where a board of true experts defining national evidence based standards of care would help immensely. unfortunately, the seed has been planted in the minds of the american public that the purpose of such a board would be to limit effective care when it could truly be to provide it more effectively. this, of course, is directly confronting the goals of many in the game: increased profits.

It's not the possible outcomes, which could just as easlly be the exact opposite of what you describe(and denying that is the height of wishful thinking), that make this is a patently stupid idea. It's the fact that said board, once ensconced, has neither checks, nor balances. It's the fact that you can't seem to comprehend why that is a massive, unavoidable, problem we don't need to create, and then attempt to solve. Have you even considered this? What's your mitigation for this? Or, is this a flight of unmitigated idiocy?

no, if you read the article and especially if you listened to brill on pbs , you'd understand that he thinks that the healthcare industry has been at full employment and is making record profits in a recession because very often demand is not discretionary and there's little competition for price. prices are not disclosed to direct individual payers til after the fact. small providers are getting squeezed out by massive "nonprofits" that often are the largest and best paying employers in an area, often with huge top executive salaries. they lobby the govt at levels that dwarf even the military contractors. while private insurers take a cut of healthcare spending amounting to billions, they are losing ground in the power battle with the large systems. the only players having any success at modulating costs recently have been the gov't programs: medicare and medicaid. and this entire ridiculous scenario is uniquely american. because we are the only country that prioritizes profits, at nearly every level of care provision, over actually providing care. yes, that includes malpractice lawyers but also layers and layers of managers and businessmen whose primary purpose it is to maximize profit at every enterprise including insurance. profit taking costs the payers, whether individuals, insurance companies or the government. no matter your opinion on the solution, it's very clear that this system is failing and is unsustainable. with health costs comprising nearly double that of most other developed countries as a proportion of gdp, we cannot compete effectively for costs of products produced with these costs factored in.

How in God's name do you think creating a never-ending fountain of underwriting/revenue that is the "public option" will reduce profit taking or cause anybody to start thinking in terms of "effective care"? If the money will never end, where is the cost cutting? Do you understand business, real business, on any level at all? Has the never ending flow of government cash caused college tuition...to go up, or down?

 

Oh, I know, just put in automatic, arbitrary cuts to reimbursement, right? That will really create a culture amongst providers to cut cost. You aren't telling them to manage anything. How are they supposed to get better at anything, to innovate, to find efficiencies, and increase the efficacy you want...if they know that no matter what they do, it just doesn't matter, their revenue is being set by arbitrary, unthinking, government employee turds whose only care is making the job at their agency easier?

 

Of course, I'm not sure if I should I expect somebody who has no more management experience than a manager of a retail store to understand the management intracies and requirements of a large organization, or even one with 50 employees.

 

So, here's a hint, providers will do what they do now: nothing but B word, and try to find ways to get over on/out of it. There will be no effort towards effectiveness, efificiency, or cost savings. Then, we WILL be rationing health care.

oh, please...estimating how many qualified candidates exist and paying a private company to provide scooters to those recipients for a set fee would require very little in resources while saving huge sums. certified would mean doctors tested on requirements and then providing exams for people that were not their patients. this is just common sense yet you dismiss it out of hand. have a lot of experience in the area, do ya?

See...this is the grand delusion. Or, in other words: communism works great, for the first 6 months.

 

Iinitially this would work. Then, what happens? In no more than 2 years, given what you have written above: The doctor who thinks his patient should get a chair...doesn't, because some faceless doctor bureaucrat says so. And, what's worse? There aren't a whole lot of companies who make chairs, and the ones that do don't make that many, the cost of them is very high, and they break all the time. Your plan = less chairs for more people, and the ones that you can get...suck miserably. Welcome to Cuba!

 

This is the lesson of price fixing and competition elimination. Perhaps you require a lesson in both? I have a book-like post that I will drop on your ass. I just finished it. It's quite effective in explaining why you are an idiot about this issue.

 

If we can agree that the above is idoicy, and that basing any idea on fixed pricing, single suppliers, arbitarty cuts/raises, and goverment "standards" like the MDS, and now the new idiocy: "Meaningful Use", is a planning to fail, then fine.

 

If not, then it's the book for you.

[birdog1960]

I agree.

 

Dopes like you have been advocating for more government since before I was born. And what's worse? When dopes like you get shut down, lose elections, etc., what's the first thing you tell people to get back in power? You tell them they are being cheated, and, if they would only vote for your candidates, they would get more. Well, don't you?

 

Where is the evidence, given 70+ years of "more government is better" FAIL, that supports your contention?

 

Throughout the course of this post. I will examine your lack of evidence and highlight the contradictory evidence.

 

It's not the possible outcomes, which could just as easlly be the exact opposite of what you describe(and denying that is the height of wishful thinking), that make this is a patently stupid idea. It's the fact that said board, once ensconced, has neither checks, nor balances. It's the fact that you can't seem to comprehend why that is a massive, unavoidable, problem we don't need to create, and then attempt to solve. Have you even considered this? What's your mitigation for this? Or, is this a flight of unmitigated idiocy?

 

How in God's name do you think creating a never-ending fountain of underwriting/revenue that is the "public option" will reduce profit taking or cause anybody to start thinking in terms of "effective care"? If the money will never end, where is the cost cutting? Do you understand business, real business, on any level at all? Has the never ending flow of government cash caused college tuition...to go up, or down?

 

Oh, I know, just put in automatic, arbitrary cuts to reimbursement, right? That will really create a culture amongst providers to cut cost. You aren't telling them to manage anything. How are they supposed to get better at anything, to innovate, to find efficiencies, and increase the efficacy you want...if they know that no matter what they do, it just doesn't matter, their revenue is being set by arbitrary, unthinking, government employee turds whose only care is making the job at their agency easier?

 

Of course, I'm not sure if I should I expect somebody who has no more management experience than a manager of a retail store to understand the management intracies and requirements of a large organization, or even one with 50 employees.

 

So, here's a hint, providers will do what they do now: nothing but B word, and try to find ways to get over on/out of it. There will be no effort towards effectiveness, efificiency, or cost savings. Then, we WILL be rationing health care.

 

See...this is the grand delusion. Or, in other words: communism works great, for the first 6 months.

 

Iinitially this would work. Then, what happens? In no more than 2 years, given what you have written above: The doctor who thinks his patient should get a chair...doesn't, because some faceless doctor bureaucrat says so. And, what's worse? There aren't a whole lot of companies who make chairs, and the ones that do don't make that many, the cost of them is very high, and they break all the time. Your plan = less chairs for more people, and the ones that you can get...suck miserably. Welcome to Cuba!

 

This is the lesson of price fixing and competition elimination. Perhaps you require a lesson in both? I have a book-like post that I will drop on your ass. I just finished it. It's quite effective in explaining why you are an idiot about this issue.

 

If we can agree that the above is idoicy, and that basing any idea on fixed pricing, single suppliers, arbitarty cuts/raises, and goverment "standards" like the MDS, and now the new idiocy: "Meaningful Use", is a planning to fail, then fine.

 

If not, then it's the book for you.

so much writing, so little sense...there are examples of similar systems to what i described providing equal or auperior care to populations at half the cost. clearly, it can work. as i said in another thread, just because you can't envision it doesn't mean it can't happen.since we are rapidly moving towards a few huge systems as providers of all healthcare, a likely next step in reimbursement is capitation. the system gets x dollars for all the care provided to y number of patients. this reverses the incentive for overutilization while incentivizing quality through holdbacks for quality measures. same could be done for durable equipment manufacturers and retailers. this isn't reinventing the wheel...it's been done successfully before. i also like the idea of reverse capitsation for doctors. specialists are capitated and primary care doctors are fee for service. this encourages the use of cheaper primary care while discouraging the overuse of specialists.

[meazza]

so much writing, so little sense...there are examples of similar systems to what i described providing equal or auperior care to populations at half the cost. clearly, it can work. as i said in another thread, just because you can't envision it doesn't mean it can't happen.since we are rapidly moving towards a few huge systems as providers of all healthcare, a likely next step in reimbursement is capitation. the system gets x dollars for all the care provided to y number of patients. this reverses the incentive for overutilization while incentivizing quality through holdbacks for quality measures. same could be done for durable equipment manufacturers and retailers. this isn't reinventing the wheel...it's been done successfully before. i also like the idea of reverse capitsation for doctors. specialists are capitated and primary care doctors are fee for service. this encourages the use of cheaper primary care while discouraging the overuse of specialists.

 

You seem surprised.

[TPS]

 

 

They do not have a leg up any more than any other company is answerable to its customer. And you are absolutely correct. Dealing with a dysfunctional customer leads to bad business practices, which leads to weak profits and extreme cases, bankruptcy. Defense contractors are not immune to the basic tenets of business, despite the myths.

 

And now on to :

 

 

 

If defense contractors have the power and strength you believe, that would show up in their outsized profits. Yet, Apple and Miscrosoft generate more cash than the entire global defense industry combined. Two companies vs an entire industry that has ungodly powers over capitalism. How does that happen?

 

Grumman didn't die because it recognized it couldn't compete and decided to sell. Otherwise it would have gone bankrupt eventually. And yes, M&A is a big cleansing process of capitalism. So exactly how are defense contractors not exposed to creative destruction? I didn't have to use Grumman. I could have used Morton Thiokol, or Martin Marrietta, or Singer Industries. Or BearingPoint, to show that defense contractors aren't limited to guys who make tanks, planes and rockets. There have been over 1,100 bankruptcies of government contractors since the '80s. I'm sure you're very familiar with Southern California's economic devastation in the early '90s with contractor retrenchment.

 

So, again, show me how defense contractors aren't subject to the same tectonic forces that constantly split capitalism apart and put it back together. You can write back in Latvian. I can understand.

That was funny.

As AD said, (something like) you can't prevent stupidity from killing a company. I'm not saying they are completely exempt. The "thesis" is that many industries protect themselves from competition through their relationships and influence over politicians and regulators--the revolving door of regulatory agencies. That does not suggest they make exorbitant profits; it's about longevity and generating nice salaries for those at the top. Also, it's not some high-growth industry to be compared to Apple--you could make your comparison with almost any industry. They don't have to make huge profits, they just have to generate a decent ROE.

 

Over the long run, no one is exempt from destroying a company, but large oligopolistic industries are about price control and reducing competition to a minimum. Again, I would argue that the big firms in many industries see regulations as a way to restrain new entrants in their markets. The big firms can afford to meet regs, the little guys can't. Big firms influence legislation. As recent topics here discuss, the farm bill isn't directed at helping small farmers; healthcare firms purchased protection, including big pharma by not allowing Medicare to bargain for discounts; Monsanto's seeds have contaminated non gmo varieties and it's the farmers who have to pay for acts of nature. The list goes on...

 

 

[GG]

That was funny.

As AD said, (something like) you can't prevent stupidity from killing a company. I'm not saying they are completely exempt. The "thesis" is that many industries protect themselves from competition through their relationships and influence over politicians and regulators--the revolving door of regulatory agencies. That does not suggest they make exorbitant profits; it's about longevity and generating nice salaries for those at the top. Also, it's not some high-growth industry to be compared to Apple--you could make your comparison with almost any industry. They don't have to make huge profits, they just have to generate a decent ROE.

 

Over the long run, no one is exempt from destroying a company, but large oligopolistic industries are about price control and reducing competition to a minimum. Again, I would argue that the big firms in many industries see regulations as a way to restrain new entrants in their markets. The big firms can afford to meet regs, the little guys can't. Big firms influence legislation. As recent topics here discuss, the farm bill isn't directed at helping small farmers; healthcare firms purchased protection, including big pharma by not allowing Medicare to bargain for discounts; Monsanto's seeds have contaminated non gmo varieties and it's the farmers who have to pay for acts of nature. The list goes on...

 

So in other words, defense contractors operate like other regulated highly capital intensive industries? But they have an evil soundbite associated with them, so they must be different.

[Doc]

so much writing, so little sense...there are examples of similar systems to what i described providing equal or auperior care to populations at half the cost. clearly, it can work. as i said in another thread, just because you can't envision it doesn't mean it can't happen.since we are rapidly moving towards a few huge systems as providers of all healthcare, a likely next step in reimbursement is capitation. the system gets x dollars for all the care provided to y number of patients. this reverses the incentive for overutilization while incentivizing quality through holdbacks for quality measures. same could be done for durable equipment manufacturers and retailers. this isn't reinventing the wheel...it's been done successfully before. i also like the idea of reverse capitsation for doctors. specialists are capitated and primary care doctors are fee for service. this encourages the use of cheaper primary care while discouraging the overuse of specialists.

Capitation? LMMFAO! Capitation was tried and it failed, birddog. To even suggest it worked, and is the "likely next step" to anything other than the downfall of medicine, is preposterous!

[birdog1960]

Capitation? LMMFAO! Capitation was tried and it failed, birddog. To even suggest it worked, and is the "likely next step" to anything other than the downfall of medicine, is preposterous!

get ready. i've heard it discussed as a fairly likely scenario by folks whose business it is to predict such things. the nonpayment for rehospitalization rule within a month is just the beginning (in itself a form of capitation) much of the problem in the past was the lack of intergrated delivery systems that could provide all care for a patient. that's not much of a problem anymore...and btw, it works pretty well for concierge practices, right now.

 

a quick search revealed this: http://www.kff.org/medicaid/8407.cfm. pretty sure kaiser still works on a capitated model and have been quite successful re outcomes and costs.

Edited March 5, 2013 by birdog1960

[TPS]

 

 

So in other words, defense contractors operate like other regulated highly capital intensive industries? But they have an evil soundbite associated with them, so they must be different.

The difference is that the biggest firms are dependent on the government for their survival. As I started with, those that have over 50% of their sales tied to govt contracts certainly are different from "normal capitalist firms."

[GG]

The difference is that the biggest firms are dependent on the government for their survival. As I started with, those that have over 50% of their sales tied to govt contracts certainly are different from "normal capitalist firms."

 

Baloney. They are no different than any other firms that are highly dependent on a major customer. It's convenient to lump DoD into a single procurement program, while ignoring that the department's biggest budget outlay is for personnel costs. Even the major contractors spread the business around different units. So while contractors may live on the hog if their pet project is the flavor of the month, they certainly run the risk of the entire program running dry in the next upgrade cycle. And if you think that the lobbyists have more sway over which programs get funded vs the congressional porkers, then you're more delusional than I give you credit for.

 

Again, if the business was so lucrative, participants would generate outsized returns, which they don't. To say that all they need is to make a decent ROE, only makes them ordinary capitalists.

[OCinBuffalo]

so much writing, so little sense...there are examples of similar systems to what i described providing equal or auperior care to populations at half the cost. clearly, it can work. as i said in another thread, just because you can't envision it doesn't mean it can't happen.since we are rapidly moving towards a few huge systems as providers of all healthcare, a likely next step in reimbursement is capitation. the system gets x dollars for all the care provided to y number of patients. this reverses the incentive for overutilization while incentivizing quality through holdbacks for quality measures. same could be done for durable equipment manufacturers and retailers. this isn't reinventing the wheel...it's been done successfully before. i also like the idea of reverse capitsation for doctors. specialists are capitated and primary care doctors are fee for service. this encourages the use of cheaper primary care while discouraging the overuse of specialists.

Oh Horseshit Birdog. In order:

 

1. I nailed your ass to the floorboards using your own "it's stupid to say more is better no matter what" words. More government no matter what, is not better. In fact, historically, for the reasonable man, it rarely has left things better than when it found them. You correctly identified that each problem must be taken seperately, and that "more is always better" is simply stupid. You just don't like the fact that your own very valid assertion is being used against you.

 

2. No Birdog. One of your many errors is: not only can I envision the problem correctly, I can also envison your stupid choices in an attempt to solve it, and their efffects, both long term and short term, and what's more? I can envision at least 3 better ways to solve the problem. The trouble for me is...should I spend my time telling you why your capitation idea not only has NEVER worked, but that those that are saying it is are either suffering from an illusion, delusion, or simply don't know WTF they are talking about?

 

Or, should I not waste time on that, and instead, tell you about my 3 better approaches, which will not only work short term, but are change-friendly going forward?

 

It's hard to say, especially on a board where douchebags whine about posts about broad and deep subjects, not being in the form of hot pockets, to wit:

You seem surprised.

Dude, if you can't see why I need to write so much on this topic, then you are retarded as well, and you should STFU, unless you have a better solution for birdog's ignorance/stupidity.

 

Birdog doesn't even understand basic things. It's either explain those basic things, so that we can then move on to explaining the intermediate reasons why he is wrong, or just take the DC_Tom route and call him an idiot, and DC_Tom already has in multiple recent threads.

 

Those are my choices. There aren't any good ones.

[OCinBuffalo]

get ready. i've heard it discussed as a fairly likely scenario by folks whose business it is to predict such things. the nonpayment for rehospitalization rule within a month is just the beginning (in itself a form of capitation) much of the problem in the past was the lack of intergrated delivery systems that could provide all care for a patient. that's not much of a problem anymore...and btw, it works pretty well for concierge practices, right now.

 

a quick search revealed this: http://www.kff.org/medicaid/8407.cfm. pretty sure kaiser still works on a capitated model and have been quite successful re outcomes and costs.

Yeah?

 

Do those predictors of stupidity know how hospitalization, and then, re-hospitilization, works? In terms of the business process? By that I mean the entire process, what the admitting people do, and the data they record, decisions they make, etc., what the nurses do, what the docs do?

 

No, they don't, do they? They know the concept in terms of a dictionary definition, but, not how it actually works. Hence, they don't realize just how easy it will be to get around that rule. How, you ask?

 

Well, birdog, why don't you show us your command of the average hospital's business processes? How would you get around the rule, and make sure that you always got paid? Edit: Sorry, "you" can be: as the private practice physician, as the nursing home, or as the hospital itself, as re-hospitalization could be a problem for any/all 3 at the same time.

 

Tip off: The first solution is so obvious, that if birdog doesn't come up with it he is either a liar or an idiot.

Edited March 5, 2013 by OCinBuffalo

[birdog1960]

Yeah?

 

Do those predictors of stupidity know how hospitalization, and then, re-hospitilization, works? In terms of the business process? By that I mean the entire process, what the admitting people do, and the data they record, decisions they make, etc., what the nurses do, what the docs do?

 

No, they don't, do they? They know the concept in terms of a dictionary definition, but, not how it actually works. Hence, they don't realize just how easy it will be to get around that rule. How, you ask?

 

Well, birdog, why don't you show us your command of the average hospital's business processes? How would you get around the rule, and make sure that you always got paid? Edit: Sorry, "you" can be: as the private practice physician, as the nursing home, or as the hospital itself, as re-hospitalization could be a problem for any/all 3 at the same time.

 

Tip off: The first solution is so obvious, that if birdog doesn't come up with it he is either a liar or an idiot.

the way to address it is rapid f/u after discharge with the pts primary care physician so that he can make sure of improvement, compliance etc. medicare has actually just approved a new code for this. some hospitals have set up clinics for pt after discharge to be seen who don't have primary care docs. they give the visits away in many instances as it's cheaper than a readmission. surprise, surprise - the answer is strong primary care. now, if the answer to "what am i thinking?" includes fraud, then i'm sure i don't know.

[GG]

The difference is that the biggest firms are dependent on the government for their survival. As I started with, those that have over 50% of their sales tied to govt contracts certainly are different from "normal capitalist firms."

 

PS - I'm surprised that you haven't mentioned the one industry where the largest players absolutely benefit from access to government's resources, and where that access is a huge differentiator and reason for survival....