Wednesday, October 28, 2009

Welcome to the return of the weregild - your life on the healthcare balance sheet

You may not remember it much, but most of those of us who were forced to endure studying the epic poem, Beowulf were introduced to the concept of the weregild. In the 2007 CGI adaptation of Beowulf, apparently the side plot discussing the weregild was cut to make more time for Angelina Jolie's CGI-enhanced, naked, high heel wearing turn as Grendel's mom. Probably a smart decision by the producers in terms of the box office :)

The weregild was literally a "man price" you paid as compensation for killing someone, and there was a price on everyone from the dregs of society all the way for one prescribed for regicide (killing the king). It's a fascinating social compact that was used to try and temper blood feuds with their cycles of repeat violence and revenge. The Roman Catholic church eventually enacted their own version of "tort reform" on the weregild, condemning it and forcing elimination of the practice near the end of the 1st millennium AD.

From Wikipedia's entry,

The standard weregeld for a freeman appears to have been 200 solidi (shillings) in the Migration period, an amount reflected as the basic amount due for the death of a ceorl both in Anglo-Saxon and continental law codes. This fee could however be multiplied according to the social rank of the victim and the circumstances of the crime. For example, the 8th century Lex Alamannorum sets the weregeld for a duke or archbishop at three times the basic value (600 shillings), while the killing of a low ranking cleric was fined with 300, raised to 400 if the cleric was attacked while he was reading mass.

The size of the weregild was largely conditional upon the social rank of the victim. A regular enslaved man (ceorl) was worth 200 shillings in 9th century Mercian law (twyhyndeman), a nobleman was worth 1200 (twelfhyndeman). The law code even mentions the weregeld for a king, at 30000, composed of 15000 for the man, paid to the royal family, and 15000 for the kingship, paid to the people. An archbishop is likewise valued at 15000. The weregild for a Welshman was 110 if he owned at least one hide of land, and 80 if he was landless.

NOTE: For those interested, there's a fascinating catalog of such fines from the Salian Franks (a German dynasty)here, which covers the price of various offences, ranging from stealing your cow to gang raping your wife

Ok Rob, why are you talking about weregilds on Plastic Surgery 101 anyway?

There were several articles about healthcare I read this week that all kind of intersect at the fringe of the debate on healthcare and got me thinking about the equivalent of the modern weregild.

"A Place Where Cancer is the Norm", which describes Houston's MD Anderson cancer center.

"Cancer Society, in Shift, Has Concerns on Screenings" which describes a pullback from the American Cancer Society on just how effective mammograms and prostate cancer screening (via PSA tests) on affecting death from cancer.

"Can 'bundled' payments help slash health costs?" in USA Today

Sunday Night's 60 Minute's piece (click here to view)on more then $60 billion annual loss to Medicare fraud and how the Feds have been inept at policing it.

An article in Oregon's Statesman Journal, "Government Audits Are Hurting Small Business Owners" describing the federal government's Recovery Audit Contractor(RAC) program for Medicare fraud.

The articles on cancer screening and exotic treatments at MD Anderson hospital to me point towards a more strict cost-benefit analysis coming on cancer treatments. The tertiary chemotherapy drugs and adjuvant radiation treatments described are budget busters with very marginal utility in terms of outcomes. The care described in the article, where chemotherapy treatments were literally thrown against the wall to see what sticks, is not a sustainable model. We're going to asking more and more, "How much are 'x' additional months of this cancer patient's life worth?" in order to balance our health care budget. It is unavoidable that we don't end up with some federal utilization committee who's job it will be to tell us what we cannot do in terms of palliative care for cancer or other chronic diseases. Other countries already do this without much controversy, but President Obama won't touch this with a 10 foot pole.

The USA Today article on bundling payments seems unworkable in situations where physicians are not employees of the hospital or system involved. I would not trust a hospital corporation to distribute that money equitably to independent providers once they have it in their coffer. Would I have access to audit a hospital's books to make sure their accounting is accurate? What's the resolution process for disagreements on the balance sheet? Much like insurers, the temptation for them to slow-pedal payments to collect the interest would be impossible for them to resist. Except in certain "closed system" situations (where all MD's are employees)like the Mayo Clinic, the Cleavland Clinic, or the Kaiser network in California, this bundling would be a unacceptable working situation to most physicians.

The 60 Minutes piece on Medicare shows why no one who is familiar with healthcare believes that the federal government can run a single-payer system. They are unable to investigate or follow up on even the most blatant examples of fraud costing hundreds of billions over dollars a decade.

So what do they do instead? They reauthorize the "RAC" program to aim at providers and hospitals for fraud that may be pennies on the dollar compared to the fraud described in the 60 minutes piece. The feds have outsourced the Recovery Audit Contractor (RAC)program to incentivized companies to autopsy medicare billing going back over 3 years by hospitals and providers where any inaccurate billing (using our byzantine CPT system) is assumed fraudulent and due back with interest and penalties. Analysts expect that inaccurate coding underbills at least as often as it overbills, but do you know what these auditors have produced. What do you get however when you incentivize these companies to claim 8-12% of any recovery (but don't reward refunds)? You get 96%+ of these RAC audits finding overbilling only.


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