Health Execs – Doing Well by Doing Well by Well-Point

May 18, 2014
Posted by Jay Livingston

When my primary care physician, a wonderful doctor, told me he was retiring, he said, “I just can’t practice medicine anymore the way I want to.” It wasn’t the government or malpractice lawyers. It was the insurance companies. 

This was long before Obamacare.  It was back when President W was telling us that “America has the best health care system in the world”; back when “the best” meant spending twice as much as other developed countries and getting health outcomes that were no better and by some measures worse. (That’s still true). 

Many critics then blamed the insurance companies, whose administrative costs were so much higher than those of public health care, including our own Medicare. Some of that money went to employees whose job it was to increase insurers’ profits by not paying claims.  Back then we learned the word “rescission”  – finding a pretext for cancelling the coverage of people whose medical bills were too high.   Insurance company executives, summoned to Congressional hearings, stood their ground and offered some misleading statistics.

None of the Congressional representatives on the committee asked the execs how much they were getting paid. Maybe they should have.

Health care in the US is a $2.7 trillion dollar business, and today’s Times has an article about who’s getting the big bucks.  Not the doctors, it turns out.  And certainly not the people who have the most contact with sick people - nurses, EMTs, and those further down the chain.  Here’s the chart from the article, with an inset showing those administrative costs. 

(Click on the chart for a larger view.)

As fine print at the top of the chart says, these are just salaries - walking-around money an exec gets for showing up.  The real money is in the options and incentives.

In a deal that is not unusual in the industry, Mark T. Bertolini, the chief executive of Aetna, earned a salary of about $977,000 in 2012 but a total compensation package of over $36 million, the bulk of it from stocks vested and options he exercised that year.

I’m sure that there is some free-market explanation for these payment inequalities, and that all is for the best in this best of all possible health care systems. The anti-Obamacare rhetoric has railed against a “government takeover” of medicine. It is, of course, no such thing. Obama had to remove the “public option”; Republicans prevented the government from fielding a team and getting into the game. Instead, we have had an insurance company takeover of medicine. It’s not the government that’s coming between doctor and patient, it’s the insurance companies. Those dreaded “bureaucrats” aren’t working for the government of the people, by the people, and for the people. They’ve working for Aetna and Well-Point.

Even the doctors now sense that they too are merely working for The Man.

Doctors are beginning to push back: Last month, 75 doctors in northern Wisconsin* [demanded] . . . health reforms . . . requiring that 95 percent of insurance premiums be used on medical care. The movement was ignited when a surgeon, Dr. Hans Rechsteiner, discovered that a brief outpatient appendectomy he had performed for a fee of $1,700 generated over $12,000 in hospital bills, including $6,500 for operating room and recovery room charges.

That $12,000 tab is slightly under the US average. (For more on appendectomy costs, and especially if you remember Madeline, see this earlier post – here.)

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* Northern Wisconsin includes three blue counties (they voted to recall Gov. Walker). The doctors, like the majority of citizens there, may have been contaminated by their proximity to liberal places like Minnesota and Canada.

Durkheim at Commencement

May 16, 2014
Posted by Jay Livingston

All these commencement speakers withdrawing because of student protests.  Condoleezza Rice is the best-known, but in his Times op-ed today (here), Timothy Egan mentions several others. The title on Egan’s piece is “The Commencement Bigots,” but Egan’s name-calling doesn’t end at “bigots.”  There’s “fragile,” (overly) “sensitive,” “strong-arm tactics,” “bully,” and “pressure tactics designed to kill opposing views.” That last one is a bit long for playground shouting, but I guess “poopooheads” wouldn’t pass the Times stylesheet, though “kill” is a nice touch.

Egan concludes:

 the lefty thought police at Smith, Haverford and Rutgers share one thing with the knuckle-dragging hard right in Oklahoma: They’re afraid of hearing something that might spoil a view of the world they’ve already figured out.

Other commentators take the “I’m rubber and you’re glue” approach saying that it’s the speakers who are the cowards. They’re the ones who chickened out. As Egan says, almost in contradiction to his argument about who it is that’s afraid, Rice “canceled after a small knot of protesters pressured the university.” Brave Condi, who stood up to Saddam and other brutal tyrants, unwilling to speak to an audience that might have small knot of protesters. 

Durkheim would have had so much to contribute to this discussion, but alas, he has not been invited to speak.

Commencement is a ritual. It takes place in the realm of the sacred, apart from the everyday, “profane” world of getting and spending, debating and politicking. In the sacred world, we emphasize unity, solidarity, and similarity.  That’s the symbolism of the event.  No individual fashion statements, just everyone wearing the same plain caps and gowns. The stadium or auditorium or whatever is festooned with the school colors, the colors that represent all of us. The message is that we’re all here together, members of the Our Uni* community.  There’s a time and place for provocative, challenging, and divisive speeches, preferably a setting where people can respond and ask questions. Graduation ain’t it. 

We accept this restriction at other rituals. At a funeral, we do not want the eulogist to challenge our positive views of the deceased. At a wedding, surely there are reasons to worry about fault lines in the terrain the couple is standing on, but we don’t want the best man, in his toast, to point out any inconvenient truths. 

Read Egan’s column and note the speakers he selects as some of the best from the recent past – Steve Jobs, David Foster Wallace, Stephen Colbert.  None of these, to judge by the key quotes Egan selects, had a political edge or promoted one side of a controversial issue.  They all offered something that the seniors could admire together, ponder philosophically together, or laugh at together. 

Since rituals are about group solidarity and the symbolism of unity, what the speaker says may be less important than who the speaker is. The university is not just asking someone to make a good speech; it is bestowing an honor. The question is not whether the person should be heard, it’s whether the university should honor that person on behalf of the entire community. As Egan says,

The foreign policy that Rice guided for George W. Bush — two wars on the credit card, making torture a word associated with the United States — was clearly a debacle. Contemporary assessments were not kind, and history will be brutal.

Rutgers students, if they are interested, can read her book or transcripts of her lectures. But surely we can understand why many graduates – maybe even more than a small knot – might not want their graduation ritual to extend her its benediction.

For our graduation speaker this year, the administration chose author James Patterson. 

I have heard some grumbling, especially among faculty in the English department. Their complaints have nothing to do with what Patterson might say. Instead, they are concerned that the school is honoring a writer whose presence would never grace their syllabi. (On a campus discussion forum, one contributor referred to him only as Paperback Writer.)

Of course, there are worse things for graduation than a divisive speaker or an airport paperback author. Egan mentions “broiling sun.” Cold and rain, our fate last year, can be just as bad.

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* In My Freshman Year, Rebekah Nathan (aka Cathy Small) gives her school the pseudonym Any U, echoing its true identity, NAU (Northern Arizona University). My favorite made-up name for a generic school comes from Montclair prof David Galef: U of All People.

“Ida” – Less Is More

May 10, 2014
Posted by Jay Livingston

I saw the movie “Ida” last night.  It’s a beautiful film.  Ken Turan in the LA Times is right.

a film of exceptional artistry whose emotions are as potent and persuasive as its images are indelibly beautiful.

More than that, as I left the theater, I realized how busy, frenetic even, most movies are.  “Most movies” means American movies. “Ida” conveys those potent emotions without any of the gimmicks found in other films.

Poland, 1962.  An 18-year old girl, an orphan, has been raised in an abbey and is now a novitiate about to take her vows. The mother superior tells her to first visit her aunt, her only living relative.  The aunt tells her that her parents were Jews. They were at first sheltered by a Christian family but then killed.  The two women set off in the aunt’s car to find out what happened – where are the parents buried, where did they live, who killed them.

So it’s a road movie. You can imagine how this might play out in a Hollywood film. The bonding of aunt and niece, the reclaiming of the family’s home and property (but only after much conflict, argument, and cleverly planned tactics by this undaunted duo), the girl finally embracing her true Jewish identity and deciding to leave the abbey and rejoin the real world . . . and that handsome musician, let’s not forget him.

Not in “Ida.”  The movie is striking for what it doesn’t have – all those things we so take for granted in films that we don’t notice them until they are absent..

Color.  “Ida” is shot in black-and-white and in the more squarish 4:3 aspect ratio (that’s 1.4 : 1; most films today are 1.8 or 2.4 : 1). The characters are at the bottom of the screen, with all that space at the top. Each shot looks like it might be a photograph in a museum. 

Cutting: Those shots are held longer. The average shot in an American film these days is a couple of seconds. In “Ida,” the camera stays fixed longer, the characters move through the frame. 

Talk: No lengthy discussions or arguments to make the characters’ motives and emotions unmistakable. A transcript of the film would run to only a few pages. Ida herself is especially laconic. And yet we know.

Music: Most films add music to tell you the mood of a scene.  In “Ida,” you hear music only when the characters hear it – the aunt’s Mozart records, the dyed-blonde singer doing cheesy Euro rock -n-roll in a club (the quartet behind her stays after hours and plays Coltrane tunes*).

Action:  Mostly walking and smoking. These are the actions which, in addition to the sparse dialogue, give us a sense of the characters. Even the sex in the sex scene is elided. 

Happy or Uplifting Ending: In American road and buddy films, even when the heroes die – think of the freeze frame endings of “Butch Cassidy” or “Thelma and Louise” – there’s a sense of triumph.  The ending of “Ida” is not ambiguous, as it might have been. But it’s not what audiences steeped in American films would want or expect. (Spoiler etiquette prevents me from giving details.)

Here’s the trailer.  To get a more accurate feel of the film, first mute the sound, then hit the pause button frequently and just look at the composition of the shot.

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* One of those Coltrane tunes, “Equinox,” wasn’t released until 1964. The movie is set in 1962, but who’s counting?

Whose Speech, Which Religion?

May 8, 2014
Posted by Jay Livingston

Does a justice’s view of the First Amendment’s “establishment clause” depend on which religion is being established? 

The First Amendment doesn’t specify any religions as more or less establishable. It just says no establishment.

This week, five conservative justices on the Supreme Court voted to allow a town council in Greece, NY to open their meetings with Christian prayers. These referred to “our Christian faith,” Jesus Christ, and the Resurrection. The justices ruled that these Christian prayers were in perfect accord with the First Amendment.  Needless to say, the five justice majority was all Christain (Catholic in fact). The two Jews and two other Catholics dissented. (The Court has no Protestants.)

 I wonder what the decision would have been if the town had had a Muslim majority that opened each meeting with “There is no god but Allah, and Mohammed is his prophet,” and the local Christians filed the First Amendment suit.

We don’t know, but on Wednesday, the Times (here) published some data from a study by Lee Epstein of decisions on another First Amendment issue – freedom of speech.  In general, the liberal justices were more likely to hold for freedom of speech, conservative justices were for regulation. But the content of the speech mattered. When the speech was conservative, the conservative justices suddenly saw the virtues of civil liberties arguments. The effect also held for the liberal justices but was much weaker.

* p < .05
(Click on the chart for larger view)

Look at Scalia and Thomas (Nino and Silent Clarence). When the speech in question is liberal, they come down on the side of free speech in maybe one case in five.  But when the speech is conservative, they take the speakers’ side in nearly two-thirds of the cases.  They are three times more likely to rule for a conservative speaker than for a liberal speaker. 

The effect for Alito and Roberts is even stronger; they are four or five times more likely to support free speech for conservatives than for liberals. The number of cases is small – 27 and 24, respectively, compared with 104 for Thomas and 161 for Scalia – but the differences are still statistically significant.

As for a comparison with the hypothetical Muslim town council and its prayers, a similar study would be impossible because there is no variation. The religion being established is always Christianity.  Still, given the evidence on speech cases, those five justices might become downright Jeffersonian in their views of church and state. Scalia would don his originalist cape and claim that “no establishment” means just what it says and that this prayer, that just happens to be Islamic, is in violation of the First Amendment. Pay no attention to that Christian prayer we green-lighted in that other case last year.

How might Scalia respond to the evidence of the justice’s bias in speech cases?  Probably the way he responded to evidence of racial bias in death penalty cases – to dismiss it as irrelevant. In McCleskey v. Kemp (1987), he agreed with the argument that social science evidence about Black-White differences in these cases was irrelevant. McCleskey would have to prove bias in his particular case – an impossible hurdle to clear.  Of course, if social science data supported a position that Scalia agreed with, he just might make a belated, if temporary, discovery of the virtues of sociological findings.