Douglas Perednia - Stop the Bleeding: How to Save Trillions by Overhauling Americas Healthcare Machine

Overhauling Americas Healthcare Machine

Stop the Bleeding and Save Trillions

Douglas. A. Perednia, M.D.

Vice President, Publisher: Tim Moore
Associate Publisher and Director of Marketing: Amy Neidlinger
Executive Editor: Jeanne Glasser
Editorial Assistant: Pamela Boland
Development Editor: Neil Levine
Operations Manager: Gina Kanouse
Senior Marketing Manager: Julie Phifer
Publicity Manager: Laura Czaja
Assistant Marketing Manager: Megan Colvin
Cover Designer: Chuti Prasertsith
Managing Editor: Kristy Hart
Project Editor: Jovana San Nicolas-Shirley
Copy Editor: Seth Kerney
Proofreader: Linda Seifert
Indexer: Lisa Stumpf
Compositor: Nonie Ratcliff
Manufacturing Buyer: Dan Uhrig

2011 by Douglas A. Perednia

Publishing as FT Press
Upper Saddle River, New Jersey 07458

FT Press offers excellent discounts on this book when ordered in quantity for bulk purchases or special sales. For more information, please contact U.S. Corporate and Government Sales, 1-800-382-3419, .

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Printed in the United States of America

First Printing February 2011

ISBN-10: 0-13-217325-5
ISBN-13: 978-0-13-217325-4

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Library of Congress Cataloging-in-Publication Data

Perednia, Douglas A.
Overhauling Americas healthcare machine : stop the bleeding and save trillions /
Douglas Perednia.
p. cm.
Includes bibliographical references.
ISBN-13: 978-0-13-217325-4 (hardback : alk. paper)
ISBN-10: 0-13-217325-5
1. Medical careFinance. I. Title.
RA412.3.P47 2011
338.433621dc22
2010040123

Dedication

For Nancy and Teddy

Contents

Acknowledgments

This book is a distillation of what we now know about fixing American healthcare. It describes the collective experience and thinking of millions of Americans, channeled through personal accounts and conversations, written reports, statistics, economic data and healthcare research. I wish that there were some way to individually thank each of the patients, clinicians, executives, economists, researchers and others who directly and indirectly contributed their time, insights and expertise, but there are far too many. Nevertheless, this book could never have been written without you.

Distilling healthcare is one thing, but surviving the process of getting into print is another. There are some individuals who need to be singled out for special thanks on this score.

First and foremost is my editor, Jeanne Glasser, who took an interest in this book when many others had written off healthcare reform as too complicated, boring, or pass to tackle. The fact that it became even more relevant after the passage of the 2010 Affordable Care Act speaks volumes about her foresight, persuasiveness, and determination. Thanks, Jeanne, and thanks to Alex Johnson and Dr. Bill Bernstein for referring me to you. Drs. Jim Grigsby and Phoebe Barton provided invaluable support and counsel while I was still looking for publisher brave enough to take the plunge. Many thanks are also due to some very smart, busy people who contributed their valuable time to review and comment on the manuscript. These include Drs. Margaret Lancefield, Donald Lindberg, Richard Fogoros and Richard Armstrong, Randy Kasten, Kevin Coltin, David Perednia, and Will Engle. Jovana San Nicolas-Shirley and her colleagues did an excellent job of shepherding me through the production process. Finally, I owe a special debt of gratitude to my family and especially my remarkable spouse. Without your endless patience, encouragement and support, none of this would have ever happened.

About the Author

Douglas A. Perednia, M.D. , graduated from Swarthmore College with a degree in Economics, and obtained his medical degree at Washington University in St. Louis, Missouri. A medical internist and dermatologist, he has spent many years in clinical medicine, in academia as a principal investigator for the National Institutes of Health, with non-profit healthcare organizations, and as a business executive in private industry. A popular speaker and writer, Dr. Perednia often works as a consultant to government, business, and non-profit organizations. In his spare time, he writes for the popular blog The Road to Hellth ( www.roadtohellth.com ), which deals with the interactions between doctors, patients, insurers, government, and the business of medicine.

Part I. The Nature of the Beast

Believe nothing, no matter where you read it or who said it, not even if I have said it, unless it agrees with your own reason and your own common sense.

Buddha

1. Introduction

Courage is what it takes to stand up and speak; courage is also what it takes to sit down and listen. Winston Churchill

Have you ever wondered why everyone talks about spiraling healthcare costs and insurance premiums, but no one ever seems to explain or address their root causes?

Do your eyes glaze over when you hear news reports and politicians talking about healthcare because it seems to be so big and complex that no one could ever understand it?

Have you ever wondered how its possible for the richest country in the world to spend more than $2.5 trillion on healthcare each year, but still not be able to provide coverage to more than 15% (50 million) of its citizens?

Are you concerned that the huge, complex, and open-ended 2010 healthcare reform law signed into law by President Obama didnt really solve anything, and is simply setting the stage for higher costs and more healthcare system upheaval down the road?

If so, this book is for you.

The good news is that while healthcare in America is dysfunctional and complex, its core problems and their solutions can be readily understood by anyone willing to read and make use of a little visual imagery. This is the big difference between the complexity of practicing medicine versus the complexity of the healthcare system . Understanding the practice of medicine requires a relatively detailed understanding of anatomy, biochemistry, pharmacology, physiology, pathophysiology, and a host of other specialized knowledge. In contrast, the healthcare system in the United States (as in any country) is simply a set of business relationships and regulations. Anyone who has purchased a product online is perfectly capable of understanding the process of ordering a laboratory test or submitting an insurance claim. The trick to understanding the whole thing is to not be intimidated and to resist being snowed by special interests who might want to assert that their business requires special expertise before it can become comprehensible.

But why should you or anyone else care about this slow-motion disaster and how to fix it? Two reasons: your money and your life.

Americas existing healthcare strategy is financially unsustainable. Left unchecked, it will continue to consume ever larger amounts of government and personal income. But, it is also medically and socially unsustainable. Government policies are increasingly making medical decisions for both you and your doctor, often with little or no science behind them. Unless our healthcare machine is truly reformed and simplified, we can look forward to being poorer, less healthy, and more rigidly regulated in our personal lives than ever before.

As shows, we already pay more for our healthcare than the citizens of any other country in the worldboth in absolute terms and on a per capita basis.

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