The Hidden Costs of the Affordable Care Act

Much has been made of the issues surrounding the Affordable Care Act (Obamacare).  Regardless of your feelings about this dramatic change to healthcare, it has some unintended consequences you probably aren't aware of yet.

Let's do a quick review.  In April 2010, both houses of Congress approved a sweeping change to how healthcare is paid for in this country.  The law had some immediate changes that kicked in (most notably the ramping up of the bureaucracy of instituting the law).  Not surprisingly, most of the congressional leaders in favor of the law either hadn't actually read it, couldn't articulate it or really had no idea how to institute it.  The institution took place and by October 1, 2013 sign-ups were opened to the public.  That portion of the law has been well documented at this point and deadlines were missed and pushed back numerous times.

What hasn't really received the same level of publicity is what the law starts to mean to the healthcare professionals charged with actually providing that care.  Again, there has been quite a bit of conjecture and posturing by both sides.  I am here to share my scary prediction about what is coming.

A smaller part of the ACA is the Sunshine Act.  This act requires every penny (above $10 per occurrence and/or $100/year) to be documented for every healthcare professional with a license.  This means every doctor, nurse, physicians assistant, nurse practitioner, physical therapist etc. is to be assigned their portion of all monies spent by Pharmaceutical Companies, Medical Device Companies, Nursing Home Sales Staff, Hospice Sales Staff, Therapy Service Sales Staff and Health Insurance Companies.

Now I know the first reaction will be negative.  I am sure each of you has been sitting in the waiting room of some physician and seen well dressed men and women walk back behind the closed doors.  Your doctor is late, and you assume it is because that sales rep is keeping your doctor from doing their job. Maybe you are just upset with the cost of your services or pharmaceuticals and you assume that they are just ripping you off.  You have read all the articles that tell you the cost of that pill should be closer to pennies instead of 10's of dollars.  Well as usual Political Dogma to the rescue.

Those well dressed men and women spend on average less than 2 minutes per visit with the doctor.  When they go behind those doors, they go sit in another area also waiting for your chronically late physician.   You just don't see that and assume otherwise.  Those prices you pay at the pharmacy do seem quite high until you recognize what you are paying for is not the actual cost of the that one pill.  You see it takes on average about $1.1 Billion dollars to bring any new product to market.  That is Billion with a B.  Then you need to recognize that 9 out of 10 products never make it to market.  Millions and often Billions are spent on products that never make a penny for the company trying to bring them to the public.  This doesn't account for the costs of marketing the product.  It may seem that the products sell themselves, but that couldn't be further from the truth.  Also, when you see that price on your receipt, that is often the price you would have paid had you not had a discount (insurance, coupon or some other item that really lowers the price).  You pay your $25 and then complain that the drug cost hundreds of dollars.  You didn't pay that much and neither did your insurance company.  This is like the MSRP you see on every other item you buy.  The manufacturer suggests a price, but very few actually pay that price.

Since we have dispelled some of the myths around sales reps and healthcare, lets get to the heart of the problem.  You remember that your physician is always behind with their schedule.  That is because to make the same amount of money (remember just because there is a certain price on your receipt does not mean the doctor gets that amount from your insurance company - they get far less), the doctor is trying to see 30-40 patients per day.  Prior to the late 1970's most physicians could see 10 patients or less per day and make a very good living.  They could spend an hour with you and it really wasn't a problem.  Not anymore.  You get 15 minutes per visit (if you are lucky).  If you need more time or have more issues, then make another appointment so the doctor can get paid for another visit.  It seems silly, but then that is how politicians think.

Beginning in October 2013, all monies spent to gain access or educate these very busy healthcare professionals is going to be allocated and reported to the Federal Government.  The numbers are due by March 2014 (and every quarter thereafter) so that these monies can be placed on a web site accessible to the public.  Yes, that is right, you will be able to see how much your doctor received from those sales people.  This may make you happy to know that someone else is getting what they deserve.  You think doctors make too much already and get special privileges so why should they get even more.  That is a class warfare idea, and it is just wrong.  You should aspire to earn as much as you like and not be torn down because you had the drive and opportunity to do so.

So you say, so what.  The doctor gets embarrassed and maybe they won't spend any time with those drug reps.  They won't get any freebies.  Agreed that is probably what will happen in some cases.  These are the places you should be concerned most about.  You see that same physician that needs to see 40 patients/day just to make the same (or sometimes less) money than they did seeing 20-30 patients just 5 years ago, he or she doesn't have the extra time to learn about new treatments.  They are exhausted when they get home, and they certainly don't want to spend their precious free time reading articles and going to seminars or spending time doing more training.  They want to spend time with their families, they want to go on vacation or even get some sleep.

How do they stay up to date with new treatments, drugs, laws or devices.  They used to get the "Cliff Notes" from these sales reps.  It might encourage them to do some research on their own.  No more my friends.  That will be gone.  They will not see these reps again, and the studies that they used to have abundantly available to them now cost money.  A paper copy of a drug study costs money to print, license and distribute.  Remember everything has value.  So when a rep gives that doctor the study to review on their own time, they have to charge them for it.  The charge is not an exchange of money (yet), but it does get reported to the government and up on that website.  So guess what, no studies get distributed.  One more barrier to that doctor gaining more knowledge since now they will have to start looking on their own (and again who has the time to do that anymore).

Those samples you beg your doctor for, come from those drug companies.  How long until the government starts taxing you or the doctor for them.  They cost money and if your doctor is not learning more about how these drugs can help you, then they start to disappear.  The reps start to disappear as well.  We are not talking about buggy whip producers from the end of the 19th century.  I am not suggesting you keep drug reps around simply because they aren't able to change with the times.  I am just mentioning that without these drug reps you lose a key educational component for healthcare.  You lose the drug reps (and currently that is the most effective method to generate sales), and you start to lose the money for Research and Development that is trying to come up with the treatment for other diseases or better options than are currently available.  Drug companies have tried to replace the sales rep, but nothing short of a face to face discussion has been even remotely successful.  Certainly you shouldn't care, but without new products the Drug Companies slowly fade away.  No new innovations, no new products and no new breakthroughs.

So if you are happy withe every treatment for every disease then you shouldn't care.  If you like generic drugs that work okay and do things well enough then move on.  If on the other hand you believe that a cure for cancer, AIDS and birth defects is out there, they you should care quite a bit.  Remove the personal animus you might have been taught regarding those with more education or who make more money.  This isn't about any of that.

When fear rules decision making, people suffer.  Physicians afraid to be on a "list" make bad medical decisions.  If they can make up the educational deficit great.  How many do you think will do that?  There is an old joke around the medical field.  It goes like this:  What do you call the man or woman who graduates last in their class from medical school?  The answer is: Doctor.  That is right, just like in every other profession some are better than others at their job.  It would be nice to assume that every doctor is amazing and superior to the general population.  They aren't even close.  They are human just like the rest of us, and they make mistakes.  Unfortunately, some flunk out of Veterinary School and become your personal physician.  That is very true and also very sad.

Forget the class warfare tribble you have been force fed by the popular media.  Someone will always make more money than you.  Someone will always be smarter than you.  It is what you do with what you have that is important.  No one has ever made themselves great by showing how small some else is.  This is no exception.  Demand that your physicians remain vigilant.  Tell them you don't care if they are on some list.  You care that you know about all of the options available to treat you.  The good physician has earned their position and should be compensated accordingly.  If your doctor is not on that list, you should be concerned.  This is the litmus test of cutting edge medicine.  You want the doctor willing to try something new instead of continuing with the old simply because they don't know better.

I have attached two videos below.  One speaks about celebrating humanity and our shared achievement (caution there is some cursing, but it is worth a listen).  The other takes on that much ballyhooed notion that taking from the rich will somehow solve all of our problems.  It is entertaining to see this fallacy dispelled.  Remember education is not a short-term undertaking.  You can never just stand still in life.  Either you are moving forward or backward, but you will never be at the same spot because life moves forward with or without you.