Introduction to Health Care Torts - DR
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Transcript Introduction to Health Care Torts - DR
History and Evolution of Medical Care
Institutions
Professor Edward P. Richards
LSU Law Center
http://biotech.law.lsu.edu/
Key Issues
Scientific medicine is about 120 years old
Technology based medicine is less than 60 years old
Doctors are not scientists and many do not practice
scientific medicine.
Modern medicine is shaped by its history
Health care finance shapes medical care
Special interests undermine cost-effective care
Financial tinkering destabilizes primary health care
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Critical Dates in Medicine
1400s
Birth of Hospitals
Places where nuns took care of the dying
No medical care – against the Church’s teachings
No sanitation – assured you would die
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Early 16th Century
Paracelsus
Transition From Alchemy
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Mid 16th Century
Andreas Vesalius
Accurate Anatomy
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Early 17th Century
William Harvey
Blood Circulation – the body is dynamic, not
static
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1800
Edward Jenner
Smallpox and the notion of vaccination
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1846
William Morton - Ether Anesthesia
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1849
Semmelweis
Childbed Fever and sanitation
Scientific Method
Controlled Studies
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1854
John Snow
Proved Cholera Is Waterborne
Basis of the public sanitation movement
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1860-1880s - Development of the Germ
Theory
Louis Pasteur
Simple Germ Theory
Vaccination For Rabies
Pasteurization to kill bacteria in milk
Joseph Lister
Antisepsis – surgeons should wash their hands and
everything else, then use disinfectants
Koch
Modern Germ Theory
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Sanitation Movement - Modern Public
Health: 1850s - 1900s
Lead by the Shattuck Report on Sanitation in
Boston - 1850
Waste water disposal
Drinking water treatment
Pasteurization of milk
Food sanitation
The Jungle - 1905
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The Business of Medicine in the 1800s
Physicians are Solo Practitioners
Most Make Little Money
Have Limited Respect
No bar to entry to profession
Most medical schools are diploma mills
Limited or no licensing requirements
Cannot make capital investments
Training
Medical equipment and staff
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Transition to Modern Medicine and
Surgery
Surgery Starts to Work in the 1880s
Surgery Can Be Precise - Anesthesia
Patients Do Not Get Infected - Antisepsis
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Effect on Licensing and Education
Once there are objective differences (people live)
between qualified and unqualified docs, people care
You can make more money with better training
You can make more money with better equipment and
facilities
Effective Medicine Drives Licensing
Licensing Limits Competition
Physicians Start to Make Money
Allows capital expenditures
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The Tipping Point - 1910
About 1910, going to the doctor, and particularly
the hospital, shifted from being more dangerous
than avoiding them to increasing your chance of
survival.
Flexner Report - standardized medical education
and shaped the modern training system
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Legal Limits on Physician Practice
Organization - 1920s
Corporate practice of medicine
Physicians working for non-physicians
Concerns about professional judgment
Cases from 1920 read like the headlines
Banned in most states
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Impact of Corporate Bans on Institutional
Practice in Most States
Physicians do not work for non-governmental hospitals
Independent contractors governed by medical staff
bylaws
Sham of “buying” practices
Not as much of a factor in LA
Charade of captive physician groups
Managed care companies contact with group
Group enforces managed care company’s rules
Physicians can be as ruthless as anyone
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From L'Hotel-Dieu to High Tech
The Evolution of Hospitals
From Nuns to MBAs
Reformation of Hospitals
Paralleled Changes in the Medical Profession
Began in the 1880s
Shift From Religious to Secular
Began in the Midwest and West
Not As Many Established Religious Hospitals
Today, Religious Orders Still Control A Majority of
Hospitals
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Technology in Hospitals - The Advantage
of Hospital Care over Home Care
Driven by antisepsis - homes were safer before
antisepsis
Started With Surgery
Medical Laboratories
Bacteriology
Microanatomy
Radiology
Services and Sanitation Attract Patients
Internal Medicine
Obstetrics Patients
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Post WW II Technology
Ventilators (Polio)
Electronic Monitors
Intensive Care
Hospitals Shift From Hotel Services to Technology
Oriented Nursing
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Post World War II Medicine
Conquering Microbial Diseases
Vaccines
Antibiotics
Chronic Diseases
Better Drugs
Better Studies
Childhood Leukemia
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Effect of Medical Science on Hospital Care
1930s
Few effective treatments means no cures other than
surgery
Long stays, hospitals act as nursing homes
Care is nursing and palliative
Post-1960s
Many effective treatments
Much shorter stays - expansion of nursing homes
Most care is technological
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Changes in Hospital Financial Models
Pre-1970s
Mostly Charitable
Built on donations, not debt or bonds
Reduced operating costs and pressure on occupancy
Post 1970s
Debt
Stock market - pressure for performance
Huge pressure on occupancy and profitability
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Joint Commission on Accreditation of
Hospitals
1950s
American College of Surgeons and American Hospital
Association
Now Joint Commission (on Accreditation of Anything
that Makes Money in Health Care)
Split The Power In Hospitals
Medical Staff Controls Medical Staff
Administrators Control Everything Else
Enforced By Accreditation
Depends on Medicare/Medicare waiver
Seldom pulls accreditation
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Contemporary Hospital Organization
Classic Corporate Organizations
CEO
Board of Trustees Has Final Authority
Part of Conglomerate
Medical Staff Committees
Tied To Corporation by Bylaws
Headed by Medical Director
Raises Conflict of Interest/Antitrust Issues
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Medical Staff Bylaws
Contract Between Physicians and Hospital
Not Like the Bylaws of a Business
Selection Criteria
Contractual Due Process For Termination
Negotiated Between Medical Staff and Hospital
Board
Limits corporate control as compared to
employee models
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Break
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Introduction to Medical Care Economics
From the Blues to Managed Care
Paying for Medical Care
Pre-WW II
Mostly Private Pay
Some Employer Provided - Kaiser
WW II
Price Controls
Post WW II
Health Insurance As Benefit
Private Insurance
The Blues
Medicare/Medicaid
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Blue Cross - Blue Shield
Developed by Docs and Hospitals
Sold to Teachers
Assure Access
Assure Payment
Reimbursement Policy
Pay Whatever Was Charged
Subsidize the Rural Areas
Subsidized Over-bedding and Over Treatment
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Federal Programs
Social Security Income and Disability
1930s
Lifted the elderly out of poverty
Provided disability insurance for workers
The disability is quite a big and valuable program
and pays for a lot of medical care
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Hill-Burton
Post-WWII
Funded construction of community hospitals
Had community service requirements, but those
have all expired
Created the US emphasis on hospital based care
Spent from the 1970s to the 1990s reducing
hospital beds to control costs
Excess beds or Surge Capacity?
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The Great Society
Medicare
Old People
Certain disabled people
Medicaid
Poor People
Nursing Homes
About 40% of medical dollars
Fought by the AMA
Made Docs Rich
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No Good Old Days for Patients
Gaming the System under Fee For Service
Right to Die As Example
Cannot Just Open the Checkbook
Greed Is Not Good in Medical Care
Fee for Service Drives Unnecessary Care
Hospitals Have to Care More About Money Than
Patients
Rich Docs Are Not Always Better Docs
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Federal Interventions
Feds Pay About 45% of Health Care
Other Plans Follow the Feds
Usual and Customary Charges for Docs
Based on the Community
Adjusted for the Docs Previous Charges
Complex
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Hospital Costs
Big dollars are in the hospital charges
Docs only get 20-25% of the health care budget
Hospitals get a lot of the rest
Drugs are an increasing share
Fee for service drove unnecessary care
Open-end reimbursement drove high prices
Hospitals did not even know what things cost
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Diagnosis Related Groups - DRGs - 1983
Watershed in Health Care Reimbursement
Prospective Payment (Capitation)
Based on Admitting Diagnosis
Fixed Payment
Some Adjustments
Encouraged health insurers to also manage
physician care
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Making Money Under DRGs
Fewer Tests and Procedures
Complete Reversal of Prior Reimbursement
No Bump for ICU
Reduce Length of Stay
Dropped About 20% at Once, continued to drop
Ideal Is Out the Door, Dead or Alive
Patients Discharged Much Sicker
Which Was Right, Then or Now?
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Federal Laws Enabling Managed Care for
Docs
Federal HMO Act in the 1970s
Preempted State Laws Banning Prepaid Care
ERISA
Passed to allow labor unions to negotiate national
health plans with big employers
Preempts state regulation of certain self-insured
health plans
Gave self-insured plans an edge and drove most
employers to them
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Managed Care Organizations - MCOs
Insurance Plans That Control Patient Care
Includes the Old Alphabet Soup
HMOs
PPOs
IPAs
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Two Major Variables
Employer or Contractor
Do the docs work for the plan or a captive group?
Do the docs contract with many plans, treating
patients based on different plan benefits?
Open or Closed
Do the docs treat only patients from a single plan or a
mix of plans?
Why do these matter?
Leverage on the doc's decisions
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Direct Controls on Costs by the Plan
Pay Less for Services
Use Market Power to Bargain
Control Access Points
Limit Hospital Stays
Limit Tests, Procedures, and Referrals
Direct Control of Access
Pre-approval
Tell the Docs What to Do
Most Honest
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Indirect Controls
Capitation
CRF--Consultation and Referral Funds
Withhold and Incentive Pools
Stop-loss and Reinsurance
Total Capitation
Economic Credentialing
Dumb Down Services
Free Ride on Other Plans or the Government
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The Cost of Medical Care in the United
States
Health As % of GNP Has More than Doubled in 50
Years
It is 20%-50% Higher Than Europe
Their Health Statistics Are Just As Good
Do They Know Something We Don't?
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U.S. Has A Lower Life Expectancy than
Most Other Industrialized Countries
Taken as a major criticism of the US system
Is life expectancy really the right measure?
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Life Expectancy Is Not Health
Bias
Weighted Toward the Young
One Baby Is Worth Several Grannies
Only Life Counts
Discounts Quality of Life
Nursing Home Is As Good As the Ski Slopes
Masks Aging Population
Masks Improved Health
A Good Measure for Developing Countries
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What Complicates Health in the US?
We Have 3rd World Public Health
Ineffective Prenatal Care
Poor Immunization Practices
Limited Access to preventive and routine care
Teen Pregnancy
Prematurity
Poor Parenting
Developed World Leader in AIDS
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Non-medical Issues
The Problem of the Poor
Poor Education
Poor Health Habits
Cannot Afford Prevention
Geography
Too Many Isolated Areas
Expensive to Deliver Care
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How has the Health Care Umbrella been
Expanded?
Sin to Sickness
Alcoholism
Drug Abuse
Miscatagorization
Nursing Homes - housing?
Vanity Surgery - life style?
Should Compare Total Social Welfare Budget with
Europe
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The Core Problem
Public health and primary care does not work well
Chronic diseases can be mitigated, but not
cured or prevented
Shifts care to expensive technology and drugs
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Second Order Demographics
People live longer because of medical care and
public health
More old people
More people with chronic illness do not die
Old people need more
Total cost goes up
Health is much more expensive than death
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Impact of Governmental and Private Plan
Economics and Special Interests on Care
High tech care has the strongest interest groups
Providers and suppliers have a lot of money
Patient advocacy groups are easy to capture
Captures every more of the budget
Primary care, prevention, and public health
Not sexy
Big savings are low tech, long term
Not a good news story
Providers do not have the money to fight
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Specialty Hospital Example
Pros
Complex care is safer when regionalized
Better care at lower prices
Cons
Do not money losing services
Do not take uninsured patients
Shift the most valuable patients from community hospitals
No EMTALA requirements if no ER
Dramatically increase unnecessary surgery
No limits on construction in LA
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Patient Directed Care Example
Patients will spend their own money and will thus make
better decisions
What is their knowledge base?
Can you really learn what you need on the WWW?
How will this play out for preventive care?
What is the incentive for providers?
Feel good drugs?
Antibiotics?
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Health Care Reform
Who will lose?
Who will win?
How will we pay for expanding access?
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First Shot in the War Against Reform:
Comparative Effectiveness Research
Pharma and their supporters say it will interfere
with your doc's right to make the best decision for
you
Question - how can he make that decision with no
comparative effectiveness data?
What is Pharma really worried about?
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