Electronic Payment and Healthcare Coupon Books

Coupon Book with Scissors
The way we pay for things is changing rapidly. Apple Pay can be used in millions of stores including at ACE Hardware, Best Buy, Crate and Barrel, Dunkin’ Donuts, KFC, Kohl’s, Macy’s, McDonald’s, PetsMart, Pizza Hut, Staples, Starbucks, Walgreen’s, and Whole Foods. Simply place your Apple Watch or iPhone near the payment terminal and payment is completed. 

In addition to payments at stores, millions of consumers are paying each other, friends and family, and providers of personal services. For example, you can pay a housekeeper, landscaper, painter, or carpenter with your smartphone. Zelle, a digital payments network launched in 2017, is operated by Early Warning Services, a private financial services company owned by Bank of America, BB&T, Capital One, JPMorgan Chase, PNC Bank, US Bank, and Wells Fargo. Fifty other banks are participating. The Zelle service enables consumers to electronically transfer money from their bank account directly to another registered user’s bank account, within the United States, using a mobile device or the website of a participating bank. Money is transferred in minutes with no checks, no envelopes, no stamps, and no fees. According to Reuters, nearly 250 million transactions valued at $75 billion were transferred through Zelle in 2017. Apple Pay, Zelle, and others represent the beginning of a major shift in how we make payments.

Then there is UnitedHealthcare, the largest health insurance provider in America. A UnitedHealthcare unit had been chosen to fix the healthcare.gov website. They are reputed to be a company with the technical expertise to make the health care system run more efficiently. Efficiency is desperately needed in healthcare. How efficient is United Healthcare?

A few months ago, my wife and I changed banks. Our monthly premiums are deducted from our bank accounts, and we made the change online at UnitedHealthcare’s website, probably the worst website I have ever used. A month later we each received a Coupon Payment Book. Yes, a physical paper payment book with printed coupons in it along with 12 envelopes in which to return checks for our monthly premium payments. The last coupon book I can recall was from a bank when I bought my first car in 1967. I cannot remember the last time I wrote a check. This is the digital 21st century, but our nation’s largest healthcare insurance company is using coupon books. They do offer the option of automated deductions, but they hang on to the methods of the past.  

I do not like to make negative statements here about individual companies, but I must say I find UnitedHealthcare more than disappointing. This post is partly a rant, but mostly about a serious issue — the cost of American healthcare. We spend more  than two-and-a-half times as much as most developed countries in the world, including relatively rich European countries like France, Sweden and the United Kingdom. As I detailed in Health Attitude: Unraveling and Solving the Complexities of Healthcare, there are numerous reasons why our healthcare is so expensive, but, in part, higher costs arise because the U.S. has been slow to adopt progressive information and communications technology to improve the administration of healthcare and to reduce waste.

I believe the best solution is for the government — yes, the government has a role — should mandate the industry develop payment standards. Hospitals and doctors must adhere to uniform accounting standards to report their financial performance, but they can use whatever payment and electronic medical record system they want, or chose to use none. There are 250+ EMR vendors and they are less than compatible. Germany has 300+ healthcare insurance companies, but they all must comply with certain standards. One study showed if the United States had the same administrative efficiency as Canada, we would save $300 billion. 

I know a number of my readers favor a single payer system. As I detailed in Health Attitude, I believe we should have national standards for payment and EHRs, but healthcare administration should be done at the state level. New York, Ohio, Florida, and Texas are truly different from one another, and themselves larger than many countries. Healthcare.gov showed us one size does not fit all. We need to adopt standards and encourage the states to develop efficient information technology systems.

Meanwhile, Reuters reported a federal judge ruled the U.S. Justice Department can move ahead with a $1 billion lawsuit against UnitedHealth alleging it used inaccurate data for Medicare Advantage patients to bilk the government.

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The That Syndrome – 2

That Way signJournalists and authors seem to love the word “that”. My pick of the week comes from a cryptocurrency interview posted in the marketplace.org blog. Seven thats in a sentence could be a record.

“The way that bitcoin works is conceptually very simple, which is just that when you make a payment, you tell everybody else on the network that that payment happened, and then they all make a copy of that record that you made that payment.”

Perhaps the following re-do would be easier to read. “The way bitcoin works is conceptually very simple. When you make a payment, you tell everybody else on the network there was a payment, and then they all make a copy of the record showing you made the payment.” 

Both versions are ok, but the re-do reads more smoothly to me. 

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Corrupt Congress

Healthcare Cost

Congress not only indirectly raised the cost of healthcare by not allowing Medicare to negotiate drug prices, but also in at least one case, it raised the cost of drugs through a pinpoint piece of legislation. The New York Times reported a provision buried in the “fiscal cliff” bill passed in January 2013 gave Amgen, the world’s largest biotechnology firm, a two year pass on Medicare’s plan to regulate the cost of Sensipar, a drug used by kidney dialysis patients. The politicians behind the provision were Senators Max Baucus (D-Montana), and Orrin Hatch (R-Utah), both of whom have received contributions from Amgen. The news about the provision’s passing was so positive for Amgen the company communicated the coup to Wall Street analysts. The Times reported the provision is projected to cost Medicare up to $500 million over the two year period.

Last week, it was disclosed CDC Director Brenda Fitzgerald, MD, had made an investment in tobacco company stocks while she was in office. The CDC she headed reported cigarette smoking is responsible for more than 480,000 deaths per year in the United States, including more than 41,000 deaths resulting from secondhand smoke exposure. She was forced to resign, but Congressional members seem to be immune. STAT, a national publication focused on finding and telling compelling stories about health, medicine, and scientific discovery, reported two U.S. senators on the Health, Education, Labor, and Pensions committee had made similar investments. Sen. Patty Murray (D-Wash.), the committee’s ranking Democrat, benefited from a gain on R.J. Reynolds stock bought by her husband. Sen. Orrin Hatch (R-Utah) had purchased Philip Morris International stock worth $15,000-$50,000 in 2012, when he served on the committee.

There is no shame in Congress. STAT research showed about 30 percent of senators and 20 percent of representatives held $68 million in investments in biomedical and health-care companies, or in funds which invested in those industries. STAT reported, “The most common investments in the House were Pfizer, Johnson & Johnson, Merck, and Abbott Laboratories. In the Senate, investors favored Johnson & Johnson, Pfizer, and Merck.” The examples STAT described of multi-million dollar conflicts of interest where congresspersons voted in alignment with their investments reads like a script from a Hollywood thriller.

The need to reign in the out-of-control drug pricing is obvious. The resistance the idea will face in Congress is also obvious. A lobbyist for Public Citizen said he wasn’t surprised at the personal investments of our congressional representatives who are elected to look out for us: “They’ve never seen fit to apply the same conflict of interest law to themselves that they apply to everyone else.”

Read the full story on congressional investment holdings from STAT here. Read more about pharmaceutical industry pricing in Health Attitude: Unraveling and Solving the Complexities of Healthcare.

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Conducting Mozart

ConductorIt was a real treat in St. Augustine last Saturday night when Music Director Gerard Schwarz conducted the Mozart Orchestra New York. They performed Mozart’s great last three symphonies, No’s 39, 40, and 41. The 41st, known as the Jupiter Symphony, is my favorite. Mozart composed this great trilogy in a remarkably short time between June 26 and August 10, 1788. After he completed these, no more followed in the three and a half years which remained of his short 35-year life. It is a mystery why Mozart would be motivated to write three symphonies in such short order with no evidence of a commission for any of them. He died in 1791 as a pauper.

Fifteen years ago, at a charity auction, I won the Golden Baton award entitling me to conduct the Ridgefield Symphony Orchestra. Although I played clarinet in high school and college, I had never conducted. Maestro Sidney Rothstein suggested the first movement of Mozart’s Symphony 25. He taught me a lot in just a few sessions, and he said I was ready to raise the baton and conduct. The live rehearsal broke the ice and showed me it was actually possible to conduct not just an MP3 on the home audio system, but real people — professional musicians. It is the people who make all the difference. The key question for me was whether the musicians would accept me as their temporary maestro. No doubt, the question on their minds was whether I had learned enough about conducting to not embarrass myself and the orchestra, or would they have to stare at the floor for fear my conducting would distract them from playing the music properly.

The Saturday afternoon of the concert day was the last rehearsal, and in preparation, I took my baton once more and did some “armchair conducting” with Mozart. Hours of doing this enabled me to memorize the piece. I watched videos of several famous conductors. The live rehearsal went fine but more importantly I got there a bit early and was able to get to know some of the musicians. The concertmaster told me about her four children, a cellist told me about the music class he teaches, and another cellist told me he had read my blog. Some of the musicians teach tens of hours per week traveling from home to home helping create the next generation of professionals. The orchestra was a highly diverse group of people, and each brought a wealth of cultural and musical experience.

When it came time for the concert, I felt ready. Jeno Herceg Clothier & Formal Wear tailored my tuxedo with tails, Tate Newland had provided a beautiful baton, Sidney had taught me the basics of conducting, and most importantly, the musicians had accepted me as part of their team. I was as ready as I going to be. The musicians had warmed up, the concertmaster came out amidst applause, and tuned the orchestra. Sidney was behind the curtain ready to tap me on the sholder to signal me to the stage. I have been on a stage hundreds of times to make speeches about “The Future Of The Internet”, but never before to be part of such an incredible team of professionals. I gave a small bow to acknowledge the audience, shook hands with the concertmaster, and took my position on the box.

I smiled at the musicians, and they smiled back. We were ready to perform together. As Lawrence Welk said, “a one and a two”, and off we went. We started together and we ended together. It was the most exciting time of my life. The audience seemed happy, but not as happy as me. I took a bow, and then turned and motioned the musicians to stand. After I had turned to take another bow to the audience, I turned back and saw the orchestra applauding me. I felt a lump in my throat and very blessed to have had the opportunity to be a guest conductor.

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Disrupting Healthcare

Healthcare Cost

The State of the Union topics about tax reform, jobs, immigration, and infrastructure are all important, but what about healthcare? Healthcare represents nearly 20% of our economy, people are going bankrupt or dying because of the cost of drugs, basic healthcare is unaffordable for millions, and we are the only developed country in the world which allows direct to consumer drug TV advertising and does not have some form of health insurance for all its citizens.

The last six Presidents of the United States have wanted some variation of universal healthcare for all citizens, but none have succeeded. The pharmaceutical, hospital, health insurance, and related lobbies are spending roughly a billion dollars per year to ensure our Congress does not get any ideas of trying to break the status quo and solve the problems. 

Maybe alternate approaches can help. My friend Steve Klasko, an author and leader of healthcare reform, and President and Chief Executive Officer of Thomas Jefferson University and Jefferson Health in Philadelphia, has a profound thought about this. He says, “Healthcare has to stop waiting for the government to come up with the answers.” On Tuesday, Amazon, Berkshire Hathaway, and JPMorgan announced they are forming a new healthcare company to deliver healthcare to their roughly one million employees.

When the largest retailer, the largest bank, and Warren Buffett decide to take action, the rest of American business leaders will take note and hopefully copy the effort. Warren Buffett said, “The ballooning costs of health care act as a hungry tapeworm on the American economy.” Jeff Bezos was modest in acknowledging how complex healthcare is and how difficult the new approach will be. Offering two-day guaranteed delivery of 100 million products is pretty complex too. I have a lot of confidence the disruption of the new move will be a game changer. Jeff is a profound thinker but is also incredible at keeping his eye on the future. About the new venture, he said, “Success is going to require talented experts, a beginner’s mind, and a long-term orientation.” Brilliant.

I have no doubt the three companies will find a way to create technology to provide simplified, high-quality healthcare for their huge number of employees. On Amazon, one click and you get what you want. In healthcare, there is no place to click. The electronic health records, which should help, are actually making things worse. Amazon has acquired dozens of companies since it began. The new healthcare company will likely do the same, making key acquisitions from among the large number of innovative healthcare startups.

Imagine a healthcare company that ignores the lobbyists, and is not motivated by financial incentives, but rather is motivated to  find the country’s best talent and stop the rise in healthcare costs and, at the same time, improve patient satisfaction and outcomes. I am sure CEOs of many large U.S. companies read about the Amazon move and asked themselves why they didn’t think of this.

One last comment. Although I am optimistic about the news of what the three companies are planning, we must not forget there are millions of people who do not work for one of the three and have no healthcare insurance. If we want a healthy economy, we need to have a healthy workforce.

More on the announcement: Amazon, Berkshire Hathaway and JPMorgan Team Up to Disrupt Health Care


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