The musings of a physician who served the community for over six decades
367 Topics
Downtown A discussion about downtown area in Philadelphia and connections from today with its historical past.
West of Broad A collection of articles about the area west of Broad Street, Philadelphia, Pennsylvania.
Delaware (State of) Originally the "lower counties" of Pennsylvania, and thus one of three Quaker colonies founded by William Penn, Delaware has developed its own set of traditions and history.
Religious Philadelphia William Penn wanted a colony with religious freedom. A considerable number, if not the majority, of American religious denominations were founded in this city. The main misconception about religious Philadelphia is that it is Quaker-dominated. But the broader misconception is that it is not Quaker-dominated.
Particular Sights to See:Center City Taxi drivers tell tourists that Center City is a "shining city on a hill". During the Industrial Era, the city almost urbanized out to the county line, and then retreated. Right now, the urban center is surrounded by a semi-deserted ring of former factories.
Philadelphia's Middle Urban Ring Philadelphia grew rapidly for seventy years after the Civil War, then gradually lost population. Skyscrapers drain population upwards, suburbs beckon outwards. The result: a ring around center city, mixed prosperous and dilapidated. Future in doubt.
Historical Motor Excursion North of Philadelphia The narrow waist of New Jersey was the upper border of William Penn's vast land holdings, and the outer edge of Quaker influence. In 1776-77, Lord Howe made this strip the main highway of his attempt to subjugate the Colonies.
Land Tour Around Delaware Bay Start in Philadelphia, take two days to tour around Delaware Bay. Down the New Jersey side to Cape May, ferry over to Lewes, tour up to Dover and New Castle, visit Winterthur, Longwood Gardens, Brandywine Battlefield and art museum, then back to Philadelphia. Try it!
Tourist Trips Around Philadelphia and the Quaker Colonies The states of Pennsylvania, Delaware, and southern New Jersey all belonged to William Penn the Quaker. He was the largest private landholder in American history. Using explicit directions, comprehensive touring of the Quaker Colonies takes seven full days. Local residents would need a couple dozen one-day trips to get up to speed.
Touring Philadelphia's Western Regions Philadelpia County had two hundred farms in 1950, but is now thickly settled in all directions. Western regions along the Schuylkill are still spread out somewhat; with many historic estates.
Up the King's High Way New Jersey has a narrow waistline, with New York harbor at one end, and Delaware Bay on the other. Traffic and history travelled the Kings Highway along this path between New York and Philadelphia.
Arch Street: from Sixth to Second When the large meeting house at Fourth and Arch was built, many Quakers moved their houses to the area. At that time, "North of Market" implied the Quaker region of town.
Up Market Street to Sixth and Walnut Millions of eye patients have been asked to read the passage from Franklin's autobiography, "I walked up Market Street, etc." which is commonly printed on eye-test cards. Here's your chance to do it.
Sixth and Walnut over to Broad and Sansom In 1751, the Pennsylvania Hospital at 8th and Spruce was 'way out in the country. Now it is in the center of a city, but the area still remains dominated by medical institutions.
Montgomery and Bucks Counties The Philadelphia metropolitan region has five Pennsylvania counties, four New Jersey counties, one northern county in the state of Delaware. Here are the four Pennsylvania suburban ones.
Northern Overland Escape Path of the Philadelphia Tories 1 of 1 (16) Grievances provoking the American Revolutionary War left many Philadelphians unprovoked. Loyalists often fled to Canada, especially Kingston, Ontario. Decades later the flow of dissidents reversed, Canadian anti-royalists taking refuge south of the border.
City Hall to Chestnut Hill There are lots of ways to go from City Hall to Chestnut Hill, including the train from Suburban Station, or from 11th and Market. This tour imagines your driving your car out the Ben Franklin Parkway to Kelly Drive, and then up the Wissahickon.
Philadelphia Reflections is a history of the area around Philadelphia, PA
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Philadelphia Revelations
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George R. Fisher, III, M.D.
Obituary
George R. Fisher, III, M.D.
Age: 97 of Philadelphia, formerly of Haddonfield
Dr. George Ross Fisher of Philadelphia died on March 9, 2023, surrounded by his loving family.
Born in 1925 in Erie, Pennsylvania, to two teachers, George and Margaret Fisher, he grew up in Pittsburgh, later attending The Lawrenceville School and Yale University (graduating early because of the war). He was very proud of the fact that he was the only person who ever graduated from Yale with a Bachelor of Science in English Literature. He attended Columbia University’s College of Physicians and Surgeons where he met the love of his life, fellow medical student, and future renowned Philadelphia radiologist Mary Stuart Blakely. While dating, they entertained themselves by dressing up in evening attire and crashing fancy Manhattan weddings. They married in 1950 and were each other’s true loves, mutual admirers, and life partners until Mary Stuart passed away in 2006. A Columbia faculty member wrote of him, “This young man’s personality is way off the beaten track, and cannot be evaluated by the customary methods.”
After training at the Pennsylvania Hospital in Philadelphia where he was Chief Resident in Medicine, and spending a year at the NIH, he opened a practice in Endocrinology on Spruce Street where he practiced for sixty years. He also consulted regularly for the employees of Strawbridge and Clothier as well as the Hospital for the Mentally Retarded at Stockley, Delaware. He was beloved by his patients, his guiding philosophy being the adage, “Listen to your patient – he’s telling you his diagnosis.” His patients also told him their stories which gave him an education in all things Philadelphia, the city he passionately loved and which he went on to chronicle in this online blog. Many of these blogs were adapted into a history-oriented tour book, Philadelphia Revelations: Twenty Tours of the Delaware Valley.
He was a true Renaissance Man, interested in everything and everyone, remembering everything he read or heard in complete detail, and endowed with a penetrating intellect which cut to the heart of whatever was being discussed, whether it be medicine, history, literature, economics, investments, politics, science or even lawn care for his home in Haddonfield, NJ where he and his wife raised their four children. He was an “early adopter.” Memories of his children from the 1960s include being taken to visit his colleagues working on the UNIVAC computer at Penn; the air-mail version of the London Economist on the dining room table; and his work on developing a proprietary medical office software using Fortran. His dedication to patients and to his profession extended to his many years representing Pennsylvania to the American Medical Association.
After retiring from his practice in 2003, he started his pioneering “just-in-time” Ross & Perry publishing company, which printed more than 300 new and reprint titles, ranging from Flight Manual for the SR-71 Blackbird Spy Plane (his best seller!) to Terse Verse, a collection of a hundred mostly humorous haikus. He authored four books. In 2013 at age 88, he ran as a Republican for New Jersey Assemblyman for the 6th district (he lost).
A gregarious extrovert, he loved meeting his fellow Philadelphians well into his nineties at the Shakespeare Society, the Global Interdependence Center, the College of Physicians, the Right Angle Club, the Union League, the Haddonfield 65 Club, and the Franklin Inn. He faithfully attended Quaker Meeting in Haddonfield NJ for over 60 years. Later in life he was fortunate to be joined in his life, travels, and adventures by his dear friend Dr. Janice Gordon.
He passed away peacefully, held in the Light and surrounded by his family as they sang to him and read aloud the love letters that he and his wife penned throughout their courtship. In addition to his children – George, Miriam, Margaret, and Stuart – he leaves his three children-in-law, eight grandchildren, three great-grandchildren, and his younger brother, John.
A memorial service, followed by a reception, will be held at the Friends Meeting in Haddonfield New Jersey on April 1 at one in the afternoon. Memorial contributions may be sent to Haddonfield Friends Meeting, 47 Friends Avenue, Haddonfield, NJ 08033.
CHAPTER ONE: Where Are We,
And How Did We Get There?
--- Teddy Roosevelt started it, but politicians have shorter memories than historians. For practical purposes, Obamacare 2012 is an extension of the Clinton health proposal of 1991, with HMOs deleted, and computers added. It is useful to conjecture Bill Clinton's strategy, which would explain much of the present muddle. If Hillary runs, we could even see it tried for the third time.
2589 Clintoncare and Obamacare: Historical Foreword
1729 Picking Out the Raisins From the Pudding
2670 Welcome to Welfare
1714 Reforming Health Reform, New Jersey Style
2622 Children, Playing With Matches
2602 Text of AFFORDABLE CARE ACT, PL 111-148, March 23, 2010, Renamed HR 3590
https://www.gpo.gov/fdsys/pkg/BILLS-111hr3590enr/pdf/BILLS-111hr3590enr.pdf
2594 The Real Obamacare, Unveiled
2672 Text of Section 1501, renamed Section 5000A: MINIMUM COVERAGE
2639 Text of Section 1251 (H.R. 3590):PRESERVATION OF RIGHT
TO MAINTAIN EXISTING COVERAGE
2673 Proposal: Coordinate Sections 1501 and 1251
2676 Health Care and Education Reconciliation Act of 2010
CHAPTER TWO: The Supreme Court Has Its Say
--- The U.S. Supreme Court had nursed certain Constitutional issues since Franklin Roosevelt's court-packing days, but it was state Attorney Generals who propelled States' Rights into the central Constitutional issue of the first few days of Obamacare. Liberal academics have long flirted with remaking the whole Constitution, and President Obama once taught Constitutional Law. While extreme Liberals nurse Constitutional revision, most Liberal politicians would prefer to split Republican voters with a third party. It is too early to predict which party would suffer.
2624 State and Federal Powers: Historical Review
2250 Obamacare's Constitutionality
2289 Roberts the Second
2592 More Work for the U.S. Supreme Court: Revisit Maricopa
2625 What Can Supreme Court(s) Do About Tort Reform?
2613 ERISA Is Thrust Into the Battle
CHAPTER THREE: Sudden Fiasco Of Electronic Insurance
----At first, it seemed a minor programming problem had temporarily inconvenienced the Electronic Insurance Exchanges. The realization soon emerged that the whole program was sloppy and untested, requiring months of repair, if not the abandonment of Obamacare. If direct marketing gets discredited, it would be a pity. The underlying idea was good and achievable. But this implementation was a disaster.
1288 Money Bags
2603 Electronic Insurance Exchanges
2626 Streamline Health Insurance?
2604 Redesigning Electronic Insurance Exchanges
2611 Phasing In A Direct Premium Payment
2615 Creative Destruction for Health Insurance Companies
CHAPTER FOUR: Small, Quick Proposals to Extend Health Savings Accounts
----Here's our alternative proposal, first devised by John McClaughry and George Ross Fisher in 1980, enacted into Law in 19xx by Bill Archer, and now numbers more clients than Obamacare. It requires publicity more than legislation, but six small technical amendments could rapidly turn an experiment into a national program. It seems to save as much as 30% of premiums, without much disturbance of the healthcare delivery system.
2637 FIRST PROPOSAL, Amending HSAs To Include Tax Sheltering
2573 SECOND PROPOSAL:Spending Accounts into Savings Accounts
2611 THIRD : Phasing In Direct Premium Payments
2584 FOURTH: Investments Pay the Bill: Obstetrics Lengthens Duration, Deductible Reserve is the Kernel.
2607 FIFTH: Having Invested, How Do You Reimburse the Providers of Care?
2630 SIXTH: Indemnity and Service Benefits
2585 Foreword: Children Playing With Matches: Investigating and Debating the Healthcare System
09
2636
2606
CHAPTER FIVE: HSAs, Backwards and Forwards
----The above describes the HSA and how it might be more useful if tweaked a little. This next chapter is a much more grandiose version, expanding the simple idea into a proposal for lifetime health insurance and describing the enormous unsuspected potential. Ninety-year projections are never accurate and require many mid-course corrections. We propose a new institution to monitor and steer it and attempt to describe what might be encountered. The power of compound interest could well pay for most of healthcare, but it is unnecessary to over-reach. Paying for a third of our costs would be accomplishment enough.
2590 Health Insurance Design.
2638 Pay As You Go
2587 Predictions of Future Healthcare Costs: Quis Custodiat Ipsos Custodes?
2628 Average Lifetime Medicare Balance Sheet
2627 Shifting Money Backward in Time: Managing the Transition
2593 Economics of Chronic Disease and Catastrophic Illness
2634 Comments on Diagnosis Related Groups (DRG)
2635 Admonitions: Using the Transition to Lifetime Health Insurance as an Inflation Restraint
2473 An Unending Capacity to Generate New Problems
1734 Healthcare Reform for Lobbyists
2485 Cost Shifting, Reconsidered
2571 Proposed: A Republican and/or Conservative Healthcare Solution
2610
CHAPTER SIX; Reforms More Basic Than Obamacare
----Obamacare is just coverage extension by subsidies. The biggest flaws in our payment system are fifty years old and are the cause of most of the delivery system flaws. Meanwhile, Science is reducing disease costs by reducing disease, for all income brackets. By switching "medical" care into "health" care we keep authorizing new carpetbaggers to bill the insurance. Physicians received 20% of payments in 1980; now it is 7%, half of which is spent on overhead. Nevertheless, compound interest income could reduce costs greatly without changing healthcare. Lifetime insurance (above) could pay for about a third of future costs; direct cost efficiencies could probably save another third, leaving a third to be paid in cash. But don't make it entirely free, unless you want to make it entirely ruined.
2633 Stepping out of the Obamacare Frame
1730 What Obamacare Should Say But Doesn't
2616 The Coonskin Hat
2404 "They Don't Make That, Anymore"
2564 Last Cow in Philadelphia
2112 Paying for Assisted Living
1431 July 4, 1776: Patients in the Pennsylvania Hospital on Independence Day
1733 Obamacare And Its Repair, Executive Summary
2453 What's The Matter With a Conservative Answer?
Once a bill is signed by the President after enactment by both houses of Congress, it is normal procedure for the Executive branch to devise regulations (with the force of law) to implement its intent. Commonly, this process uncovers unintentional flaws in the statute, which is then returned to Congress for "technical" amendments. When there is a politically divided government however, suspicions can be instinctive in the Supreme Court that regulations or technical amendments might be written to conflict with the original will of Congress. Before matters get to that point, however, differences between House and Senate versions must be reconciled, and then identical reconciliations must be agreed by both houses. In the case of the Affordable Care Act, widely differing versions between the two houses were tolerated or even encouraged, but the House version was withdrawn in order to jam through an identical version of the Senate bill in its place. This did avoid the need for reconciliation. However, the maneuver was so hurried it required more than average corner-cutting, and potentially had to accept some un-removable booby traps in the surviving Senate version.
Republican Senator Scott Brown
A situation of this complexity would be difficult under any circumstances. But the Senate required a supermajority of 60 to evade a filibuster of the reconciliation. The Democrats had a bare sixty, including some with deep reservations which could only be pacified by accepting unwelcome provisions. And, it included at least two Senators in poor health. Consequently, differing Obamacare bills had been passed while there was a safe Democratic majority in the House of Representatives, but only one-vote Democratic filibuster control in the Senate. Democratic Senator Edward Kennedy then died, and an elected Republican, Scott Brown, replaced him. With Democratic Senator Richard Byrd in poor health the original plan to cherry-pick a clever administration hybrid out of differing versions in front of the House-Senate conference committee, became unfeasible, if not dangerous. About the only option seemingly available to the Democratic floor leaders was to adopt one version or the other and then achieve consent for an identical bill from the other house. The Senate version was chosen to survive and be forced through the House in a matter of hours, even though almost no Congressman had read it; and this behavior was conducted under full television coverage by C-Span. Television viewers probably did not have enough information to understand why things were being handled so roughly, but it added to a public distaste for the brutal tactics they could readily observe the leadership had been applying. Although it has been useful to blame excessive partisanship for this mess, it would not be difficult to name a dozen majority leaders in the past who might have surmounted such difficulties with more instinctive ease.
Democratic Senator Richard Byrd
The Republicans were given no face-saving consideration in any of these matters and reacted with outrage. The obedient Democrats were humiliated by the public watching their abject subjugation. As one consequence, the November 2112 election administered a heavy defeat to the Democrats, while sending a large contingent of freshmen Republican Congressmen with what they considered to be a strong public mandate to disrupt or even repeal Obamacare. Most of these new Congressmen belonged to the "Tea Party", had little experience with the "inside baseball" of Congress, and found they disliked the environment. Many of them had the inclination to repeal this one Act, followed by resigning from Congress after a single two-year term. Their fury at discovering the legislative straight-jacket they were in, must have contributed greatly to the polarization which was already notable. Naturally, the White House bureaucrats destined to write the Obamacare regulations were watching, dismayed by the prospect of claiming controversial opinions to be the "will of Congress". At this writing, it seems likely at least some regulations will come under consideration by the U.S. Supreme Court, for failing to follow the intent of Congress, for following an unconstitutional intent, or for failing to implement statutory sections of the law at all. Therefore, it would not be surprising to find some regulations which were then written, contained some "booby traps" for the Supreme Court. All of this would seem to predict epic contests between Chief Justice Roberts and President Obama, both of them constitutional strategists.
Meanwhile, many Republicans and some Democrats are calling for the President to postpone implementation, ostensibly until the enrollment computers are fully functional, but really hoping to get past the November 2014 elections. The approaching State of the Union address might have been an opportunity to blow the trumpet of compromise. But Barack Obama has proved to be an unusually stubborn person, and the prospect of facing an opposition majority in Congress does not seem to bother him. If he chooses to tough it out, perhaps we can finally learn exactly what he had in mind for the Law. If it is of any consequence to him, he had managed to get this far without fully revealing what he was trying to achieve. Almost before Senators Kennedy and Byrd died, the Tea Party gained control of the House, and Obama was forced to work his own way out of a hodge-podge.
A major tactical part of this strange interlude grew out of what lawyers and courts call "Standing". The Supreme Court, in particular, is rigid in refusing to hear a case where no one has been injured. Anxious to avoid hypothetical arguments more properly the province of the Legislative Branch, the Court insists on hearing real cases of injury by one party against another. When a new law has not yet been completely implemented, there is likely to be an interval when no one can claim he has been injured by it. That is, no one at all has "Standing". As we will see in a minute, various state governments took the position that the law injured them by invading what the Constitution declared was the province of the several states. And therefore, the states had been injured by the law, even though no insurance policies had been issued. It will be noted the Court's decision in the case confined itself to this argument. Obviously, it reserves the right to take up the case a second time, after millions of people acquire standing, and the Court can choose which argument, by which person with Standing, it chooses to hear.
Although scientific news about healthcare research is mostly pretty good, a storm may be approaching in psychiatry. Not only are that specialty's finances in disarray, but as the rest of the profession steadily conquers its share of diseases, lack of progress in psychiatry becomes more noticeable. Large sums are donated and granted to repair this gap, in a typically American approach to such obstacles. Maybe it is too soon to expect dramatic results. President John Kennedy once learned Thorazine was helping psychotic people go home from state mental hospitals, and put that information alongside the painful cost of maintaining 500,000 rather decrepit beds. Effectively, he closed most of them. It was well-intentioned but too quick. The important thing to notice was how very many psychotic patients there were, and therefore how big a job it entails.
Psychiatry was ruined, first by Freud, and then by the DRG.
Around 1965, the recreational drug scene along with its flower children and colorful activists unexpectedly hit us, trailed by optimistic news reports that heroin really wasn't so bad, LSD might have therapeutic potentials, and marijuana might even be beneficial compared with alcohol. Some of these contentions have been scientifically dismissed, but one discovery was greeted with delight by school children: marijuana was about the same as alcohol, but the smell on the breath didn't give it away. For a while, it was unclear whether drugs made you psychotic or psychotic people were attracted to drugs; it's still not entirely clear.
The city police, who were dragooned into maintaining law and order amidst this commotion, resorted to the only resource they had, which was the local jails. The public agreed, perhaps hoping to scare the miscreant children, and passed laws about speedy trials for drug offenders, mandatory jail sentencing, and mandatory long sentences. The prisons filled up, older prisoners taught newcomers some tricks, and it was not long before the prison systems and the school systems were destabilized. We closed the snake pits and skid rows, all right, but we gave ourselves a drug problem, a prison problem, and a school problem.
The simultaneous development of a problem we had never quite seen before, at least to anything like a similar degree, caused a few reflective people to remember we had always had a large segment who was mentally unstable. It was a tenth of the population, possibly even a fifth. My pristine suburb spends 8% of its budget on "Special" education. Some of this was indeed new. Alzheimer's disease is one of the outgrowths of the advancing longevity we are so proud of. Women who delay having children are especially prone to deliver babies with Down's syndrome of mental retardation. Women are now going to work instead of tending children and aging parents, forcing these patients more into the open. The mechanization of warfare means more rejections for mental inferiority because soldiers need to be smart to be trusted with such weapons. So it's hard to know whether there is more mental disorder than before, or whether it has always been there, and is emerging from the shadows. In any event, we must newly face a very large segment of the population who are unemployable, and as they age, are adrift even from the discipline of regular employment.
The medical profession, preoccupied with its more usual tasks, woke up to this situation in odd little ways. One strange alert we might have noticed was the woeful inability of any medical coding system to define a relationship between psychiatric diagnosis and its treatment. In almost every other sort of condition, the diagnosis alone conveyed a pretty good idea of what the disease would cost; not in psychiatry. That was true within SNOmed and ICDA, the two main diagnostic codes for all fields of medical diagnosis, as futile efforts to squeeze it into DRG were to prove. It is also just as true within DMS (Diagnostic and Statistical Manual of Mental Disorders), the codes the psychiatric profession struggled to devise as a codebook of legitimate psychiatric conditions. It's definitely possible to construct an organized list of psychiatric diagnoses, using numerical codes instead of words. But it defies the imagination of everyone who tries it, to establish any reproducible connection between psychiatric diagnosis codes and the duration, cost or efficacy of treatments. Especially efficacy of treatments, without which little progress can be expected.
In the future, expect to hear less and less about surgery and medicine. Lots of people get sick, but sick with fewer different diseases. Research currently only seems to need to devise four or five cheap effective cures. But with psychiatry, the research is powerfully inhibited by the thick impenetrable skull, the lack of resemblance between the brain's anatomy and its functions, the extreme dangerousness of surgical experimentation, and the lack of any good idea how to connect the brain with the mind. We have a long, and expensive, way to go.
After listening to a description of a Health Savings Account (HSA), the nice Quaker lady exclaimed, "Why, it's just a Christmas Saving Fund for health care!" And so it is. First, you buy a health insurance policy which pays the cost of major illnesses above a fairly high cash deductible. And second, you create a special savings account -- independently and tax-free. That one is to build up the cash deductible, and/or outpatient health expenses below (too small to trigger) the insurance.
Once your savings account has at least reached the deductible level, you are totally covered for major health expenses -- from the first dollar to last, just like Blue Cross used to be, long ago. True, you still must pay small outpatient costs, but passing them through the account reduces their cost by the income tax deduction. We hope you just keep on adding to the account as you are able, tax-free up to $3350 per year ($3400 next year), but the decision is yours alone.
Something significantly extra emerges at the age you become eligible for Medicare. We therefore even suggest a name-change of HSAs, to Health and Retirement Savings Accounts,(HRSA), because any surplus from remaining healthy turns into an Individual Retirement Account (IRA) when you convert to Medicare. For some people, this retirement addition is more important than the health care part. It will all depend on whether your health has been robust, average, or sickly. For most people, it has been robust.
As far as healthcare coverage is concerned, many speeds of differing amounts will reach the same finish line, so the Health Savings Account invites the subscriber to choose the speed he can afford to risk, periodically, to reach the deductible (or even more). In fact, there are incentives at every turn to save more, because some people won't save unless prodded a little. In fact, the average American spends $2000 annually on loan interest, because he can't resist the temptation to buy things.
But you can always delete this particular account's balance for an illness, then restore or exceed it tax-free, if part of the balance does happen to be needed for healthcare. Meanwhile, the account earns tax-free income. It isn't hard to understand, particularly if you read the description twice, but its hidden power may be less obvious. The old Blue Cross system had a "use it or lose it" quality to it, but the Health (and Retirement) Savings Account gives you back anything left over, as an incentive to save for retirement. The first part of this book tries to make clear how important the difference is. (See the table at the bottom of this first section.)
Because both deposits and medical withdrawals are untaxed, the system offers the advantages of both a regular IRA and a Roth IRA, combined. The only disadvantage to overfunding the account is to pay a penalty for non-health expenditures from it before age 65. After the HSA subscriber reaches Medicare eligibility, it all turns into an Individual Retirement Account, which you can spend on anything you please. Since you can't predict what your health will be, the harmless incentive is to keep it overfunded to get more tax abatement, but nevertheless, that's not required.
* * *
That's unique and simple, and all quite true, but it describes only a fraction of the full potential of HSAs, which require the rest of this book to explain. Read the first four short paragraphs again if they seem unclear. Much of their potential wasn't dreamed up by the originators (John McClaughry and me) at all but just tumbled out as patient experimentation and experience accumulated. It's tested, all right. Between fifteen and twenty million Americans already have these accounts. As things turn out, they are not merely attractive to poor people, although that's how they began. The original goal was to help people of average income afford what most people who work for big corporations had been given by their employers for decades, but innovative thinking has gone far beyond that modest beginning.
The Traditional, or Employer-based System. In spite of all the talk about healthcare reform, about half the population still retains the employer-based design, and they passively imagine the employer design only requires tweaking to be perfect. However, it remains relentlessly connected to the kind of job someone has. It begins when you get a job, and ends when you quit that job; that's a difficulty, right there. In employer groups, you don't buy it, your employer buys it and gives it to you as part of your salary, but you need not suppose your pay-packet is as big as it would be without it. The result is, the core of the employer system has become largely funded by tax deductions -- the employee's, (20-30%), and particularly his employer's at a higher rate (40%). The relentlessly rising costs it provokes are not the employee's problem nor his employer's problem; they are the government's borrowing problem and a big one. But the source of its cost inflation is the false appearance it is free. It isn't free. It may well be the main reason America's corporate income tax remains so high, driving our corporations abroad. Otherwise, it suppresses profits, take-home pay, dividends and tax revenue.
Employer-based health insurance is so full of cross-subsidies (both inside and outside the hospital), it would be hard to say who supports what. But clearly, young employees subsidize older ones and may lose out entirely if they change jobs, as they frequently do. Unfortunately, the Affordable Care system uses the same configuration but superimposes income groupings. Unless the Affordable Care Act changes, thirty million people will be specifically excluded from it. While it mandated uniform subsidies, its subsidy designations conflict with existing ones and cause problems which have not been solved in two extensions of the employer insurance mandate. Some subscriber groups match the government subsidy limits fairly well and prospered. But the components in other insurer groups do not happen to match the subsidies well and are threatened with considerable disruption. Stay tuned to hear how this works out.
Overall, the whole system is unbalanced, with the working third of the population struggling to support the non-working two thirds, too young or too old to be working. Thirty years have indeed been added to life expectancy in the past century, so it's hard for anyone to complain about the effectiveness of the American health system, except notice: not getting sick means a longer retirement, requiring more retirement income. Everyone wants to live longer, but few can afford a long vacation after the working years. Employer-based insurance encourages more spending; the illusion of being free encourages wasteful spending because neither the patient nor his employer have much "skin in the game". Its biggest problems grow out of its most attractive features. Everybody hates to admit it, but longer retirement costs are merely deferred, unfunded, healthcare costs, in a new form.
Further Advantages of Health Savings Accounts. Before going further, let's go back and notice what else tumbles out of the simple structure of the HRSA, or Health and Retirement Savings Account, which now becomes our central topic. First of all, it's usually lots cheaper. Sometimes it's hard to prove where the savings originate, probably about 15% from the account itself, and another 15% from the catastrophic (indemnity) health insurance. Eventually, any savings get greatly multiplied by compound interest.
Cost-Savings. The higher the deductible, the smaller the premium, is just mathematics, but it's a big reason this package appeals to financially struggling people. But notice what's obviously also true: the lower the deductible, the higher the premium. Seemingly, it should all come out the same, but in fact, it's cheaper. The HSA (Health Savings Account) started out as a new way to lower premiums temporarily, for people who didn't happen to be sick at that moment. However, if someone becomes sick, the average total of premium plus deductible, in the aggregate, surprisingly often turns out to be lower than regular insurance. That's when we started noticing its hidden features, trying to explain such hidden power. First of all, this approach probably does induce more young people who aren't sick, to buy insurance.
Having larger numbers of young subscribers lowers the average premium for everybody else because healthy youngsters essentially buy protection, not health services. Subscribers acquire some control of the premium price, but it's incomplete and they sense it, depending on insurance design. For the most part, young people overpay for protection. Nowadays, the Affordable Care Act sets mandatory deductibles for all health insurance plans, while ostensibly forcing everybody (except for 30 million embarrassing exceptions) to buy health insurance, too. That's supposedly a way of forcing premiums down, except it upsets people to be forced. And anyway, premiums for what satisfied the Affordable Care Act quickly went up higher(and alarmingly went up faster) than before. The cops and robbers approach didn't save money, probably because all government projects are "one size fits all", responding to the equal protection clause of the Constitution. That's nice, but it can't defy the law of gravity.
In better economic times, appreciable interest income is earned when young healthy people stay healthy for fifty years before they do get sick. Effectively, with an HSA you can pick any residual deductible you want, by taking more risk, or less, for a few early years. As the Christmas Fund builds up to the deductible and beyond, eventually you take no financial health risk at all and begin to take retirement risk. Let's say that again: by partially funding the insurance company's posted deductible, what's left unfunded is setting the true deductible. Most HSRA subscribers eventually fund it all and have no true remaining deductible when they get sick. But a funded deductible has changed the nature of the cost resistance. It now becomes one of protecting your investment, because you are surely going to need it, some time.
The amount of subscriber risk can remain only fuzzily described, whereas insurance companies must pay to the penny, and usually can't accept vague financial risks. This one stretches over too many years to be safe for them to predict, even in bulk numbers. Mismatches are numerous, between income and sickness experience. When you have enough money in the Health (and Retirement) Savings Account to pay a deductible, you essentially have first-dollar coverage. That doesn't exploit the full potential of HSAs, but it's at least one of the things it does. The fact that excess spending is less provoked is proof that a particular issue can be addressed. In addition, almost all modern insurance also has an upper limit to total cash out-of-pocket medical costs, but those limits are higher than the deductible. They were added to cover the remote possibility someone might have more than one illness in a limited time period. This soon gets to be a complicated insurance theory, but it includes a warning: you must know the risk if you are to assume it.
The designers of the Affordable Care Act evidently underestimated the amount of backlogged health maintenance they were assuming, and probably underestimated it by vaguely ascribing it to "pre-existing conditions." All you really need is to read the newspapers to see the Affordable Care Act is very close to getting insurers into financial trouble. (My local Blue Cross organization lost $56 million last year, and the whole industry probably lost a $billion.), thereby eventually passing big trouble on to the public. One of the major sources is an unsophisticated gap between the deductible and the lower limit of out-of-pocket costs. If you take a risk, you must know how much it is, or else who will assume it for you. To base that gap on the insurance company's need for risk limitation is a pretty crude approximation, which in fact presumes the government will assume it. Insurance executives surely knew this; whether the politicians did, is less certain. Obscuring the risk possibly doubles it, as two parties seek to protect themselves.
By contrast, the HSA subscriber does run a small but definable risk during the time the account is building up to the deductible level. He can guess at that risk, which is extremely small for young people, and hopes he won't get very sick for several years. Inevitably, older people have a greater risk because they have worse health. So right now everybody's safety rests on hustling to build up the account as fast as possible. Because it's a pretty good investment, it's a good idea to overfund the account whenever the subscriber has spare funds, just in case. Lots of poor people are too unsophisticated to have bank accounts. That's fine -- just overfund your HSA. Unfortunately, the Administration just applied a penalty for doing that in an unspecified way, a pretty vague if not unenforceable threat. I do suppose someone could get hit by a truck on the way home from buying insurance, but in that situation, the limit for uninsured costs would be the size of the deductible; if deposits had been made to the account, it would be less.
Once the gap is filled, you can change the premium or fill the account up a second time, but many people are often too unfamiliar with the twists and turn to achieve absolutely minimum costs. Rest assured, HSA is a pretty good investment although not a windfall, so unsophisticated people don't have much if anything to lose by overfunding it. Some have suggested the gap can be narrowed by buying life insurance, but cost statistics are not available to evaluate that possible approach. Someday, some enterprising insurance company will offer an automatic re-adjusting feature, but it would add cost. It requires a company to get involved without charging high fees, hoping only for big volume for a reward. Hoping for big volume implies heavy marketing investment; annuities are probably too expensive to serve the purpose.
The Retirement part is more important than the Medical part.
Note: The Standard and Poor 500 index has averaged 6.6% modal net return after inflation, for the past century (1916-2016),
including two major depressions, two World Wars, and innumerable recessions and minor wars.
Eventually, the subscriber will discover more money in his account than he absolutely needs for healthcare (and the sooner he does, the better). Some people will buy a newer car, or a bigger house, send someone to college or pre-pay some future lean year of his own when he is between jobs. If those events describe his entire future, he needs to read no further. For some people, a sudden illness may, however, terminate their planning. For the rest, however, the big problem will be to avoid outliving their retirement income, usually because they remain so healthy, not because they spent their reserves on illness. We all secretly hope the future will be good to us.
In fact, paying for retirement in the future threatens to become such a large problem, it could dwarf illness as a threat for almost anybody. It begins to raise the question of what the main threat facing any particular person, really is. Thirty years of extra longevity are wonderful, but everyone needs a way to pay for them, particularly if they should turn into forty years. Taking the long, long view is what the rest of this book is all about: We seriously propose a solid foundation of Health and Retirement Savings Accounts as a bulwark for just about everyone's far future. Meanwhile, unless someone changes the rules, it's hard to see how very many people could lose money by getting started. The rest of this book shows ways to do still better than that, without getting hurt.
This book will appear in print around the time of the November 2016 presidential election, and therefore have little effect on its outcome. I expect the election to polarize both political parties still further on the Affordable Care Act, sucking all the oxygen out of the room, as the expression goes. It is likely to create a sort of lame-duck situation during November and December, no matter who wins. Therefore, I decided to present a book which superficially seems to have little to say about the Affordable Care Act, in order to grasp the microphone first, about health issues which got ignored by the Affordable Care uproar. Even when discussion seems to focus on the A.C.A., trade-offs are blithely apt to ignore "germane-ness". And thus get to issues which have been debated very little, and pass very quickly. This book primarily attempts to do two things to re-focus attention:
1. To draw attention to the Health Savings Account legislation as a fall-back from almost any deadlock. HSA is already enacted, tested, and distributed. If Congress reaches a deadlock, the HSA is existing law, and anybody in a jam can simply go down the street and buy one. It's simple and cheap to get started, is approximately as inexpensive as any other health insurance, and you can discard it whenever you like. (Naturally, I hope people will keep it.)
It does have a few flaws, which I hope Congress might correct. It unnecessarily limits buyers to people who are employed. That seems purposeless to me, while it prevents minor children from being enrolled, limits the deposit of funds to a fixed amount of their own money, and forces people out of the HSA at age 65. Forcing people to drop it as they acquire Medicare, impairs one of its most important virtues, the incentive to apply unspent money to retirement living, just at the time they are likely to retire. Some people will have other retirement sources and time-tables, and wish to defer use of some or all of them. Getting back to children, permitting deposits at birth would add at least twenty years to the compound interest period available preceding retirement, allowing the retirement fund to grow four times as large. Dropping the age and employment limits would not require more than a few sentences of an amendment, and provide maximum flexibility.
2. We also portray universal Health Savings (and Retirement) funds as potentially "a string holding together a necklace of pearls". To do that requires major legislation, going far beyond emergency stop-gaps for deadlocks. It's potentially a program for health, phased in over a century, and including the possibility of even including ACA. Since one Congress cannot bind a successor, it provides a road map through ten or more changes of political control in Washington, adding or subtracting individual programs which sometimes have little relation with each other. As a matter of fact, if an attachment is voluntary, you can have other parallel programs without attaching them, if you prefer.
By happenstance, reform could start with one "pearl" already in place. By the legislation's automatic transfer to an Individual Retirement Account at the onset of Medicare coverage, every subscriber in effect would immediately possess one of the essential ingredients of a lifetime health and retirement funding system. That even generates coherence, symbolizing prolonged longevity as a result of earlier health care. On the other hand, it implies the present configuration of Medicare is perpetual when it already has a number of features which should be changed. Therefore, it is essential to state at the outset that the string, the HRSA, intends to be kept as simple as possible so that amendment complexity is concentrated into the "pearls" themselves. After doing so, the HSA can remain versatile enough to suffice for newborns, mentally handicapped and billionaires, alike. It might provide healthcare for prisoners in custody as well as the marooned Medicare copayment supplements. Some things wouldn't work and can be dropped without upsetting the whole system. The expression is KISS -- which they tell me means keep it simple, stupid.
The basic structure is to divide health finance into two parts, one for everyday routine expenditures, and the other for bare-bones, cheap, insurance -- for people who are too sick in bed to be bothered with haggling over finances. If there is anything left over at age 65, it can be spent for retirement and serves as a life-long incentive to be frugal about health expenses. It's for everybody, not just some demographic group. If the government chooses to subsidize certain groups, then that becomes an independent topic, sharing a common framework, hanging separately from the necklace as it were. At the moment, it's one serious technical flaw is to imply total control over investment policy lies in the hands of any corporation which manages it, leading eventually to suboptimal investment performance for customers. Also, limiting management to visible fees rather than invisible profit-competition should allow plenty of room for shopping between managers.
Having established the basic framework and pointed out its present main -- but correctable -- flaws (management control of investment, and mandatory management participation in profits), we added two potential pearls to the necklace. One is the two parts (80/20) of Medicare with its finances unified, and the other is to provide health coverage for children up to the age of 25. These are both sensitive topics and may take the protracted debate to get the mechanics right. When these two programs have finally got their books balanced by deciding who pays for what, they are ready for voluntary acceptance into HSAs, and they remain eligible to be tossed out if unexpected problems surface, once we get over any notion of infallibility. Balancing the books may include subsidies, but the subsidies for poor or the handicapped must reasonably result in balanced books. It is intended to be an insurance design, not a subsidy originator. A design, not a budget; the government may subsidize as it pleases without changing the design. The government has a right, even a duty, to provide for those who cannot provide for themselves. But deficit financing is not wise: if you are going to subsidize, subsidize the pearls, not the string. This wouldn't eliminate politics, it merely shifts politics to a less dangerous level.
At that point, we now stop detailed planning and merely list seven more "pearls" which might be added on the same terms. They would be special programs for difficult situations, like prisoners in custody, physically or mentally handicapped to the point of not being self-sufficient, and aliens within our borders. We are told the aggregate of these three groups alone is thirty million people.
When it comes time to negotiate the Affordable Care Act, between twenty and forty million more are eligible to become self-financed "pearls" after the ACA finds a way to balance its books. It is not intended to subsidize other subsidies linked to programs. That's the government's job. Unfortunately, the government has tended to raise prices for people struggling to pay their bills by subsidizing other people who cannot. The consequence is even more people cannot afford their own care, threatening to sink the lifeboat for everybody. If we are to subsidize the health care of some part of the population, let the money come from defense, or agriculture, or infrastructure, not from the quality of healthcare of some other person.
To continue the list, additional pearls for the future are the accumulated debts of fifty years of deficits, and the tax deduction-supported gifts of health insurance from employers to employees. I'd like to see some resolution of the mess left behind by Maricopa Medical Society v. Arizona decision of the Supreme Court. As these problems get worked out to be self-sufficient, they become eligible to become "pearls" as long as it remains clear this proposal is not a cross-subsidy vehicle. At the moment, the ACA shows no signs of adding anything to the HRSAs except more deficits, making solutions more difficult to find. Just because we see no end to problems, shouldn't keep us from getting started. In particular, when the ACA is addressed, out goes the oxygen from the room, diverting attention from anything except expedients. That should not be necessary. All of these problems can be worked on simultaneously.
* * * *
It is now time to identify the financial maneuvers which promise partial success. It isn't true there is only one principle involved, but there is certainly one main one. Almost all of the magic of money creation in this proposal is provided by stretching out the time for income earning. A longer earning period takes advantage of the rock-solid principle of compound interest rising at the end of its investment period. To return to our oft-repeated formula, money earning 7% will double in 10 years, so 2,4, 8, 16 reaches 512x magnification in 90 years. From age 80 to 90 the money grows 128-fold., so an original investment of $100 grows from $25,600 to $51,200 between the ages of 80 and 90 or $2,560 per year for a $100 investment. That is, it's not growing at 7%; during those last 10 years, it's growing at 256%. And it's not magic, it's just math. Furthermore, it's not new. The ancient Greek Aristotle complained about the unfairness of it because he was seeing it as a debtor. So that suggests a related strategy: wherever possible, position citizens as creditors, not as debtors.
What's new about this whole thing is the extension of longevity. In Aristotle's day, it was considered remarkable to live to be forty years old. In our era, life expectancy at birth is moving from 80 toward 90. So today it's not a pipe dream, it's a realistic strategy. But stretching it out automatically comes with problems, too. There's a greater risk, fifty years of extra opportunity for someone to chisel it from you. History is replete with examples of kings who shaved gold coins, financiers who took more profit for themselves than for their investors, central banks who give you back a penny when you invested a dollar a century earlier. If you win a war, you might emerge better off; but if you lose a war you may be more like the seventy million people who died from wars in the past century, an experience which strongly favors having no wars, but otherwise doesn't seem to change things much. This risk/reward ratio strongly suggests we have neglected the necessary precautions required. So the proposals of earlier pages to balance the Medicare budget, etc., carry the risk that something or someone will come along and divert the money to other purposes. And without planning to forestall that, you have not got a workable plan.
That's the thinking underneath the dispersion of control to individual Health Savings Accounts, just as it is the reasoning behind resistance to consolidated systems of control, such as "single payer" systems as presently described by their proponents. They all just make it easier for your trusted agent to steal bigger amounts of money at one time. William Penn, the richest private landholder in recorded Western history, spent his days in debtor's prison because his steward falsely accused him of stealing the money from him. Robert Morris, the financial savior of our nation, likewise went to debtor's prison while the Governor of his state nearly sprained his hand signing over property deeds to himself. When the Federal Reserve was created in 1913, a dollar was a dollar; now it is a penny. Nobody needs to explain what "pay to play" means. So, although we need much more ingenuity in devising safeguards for savers, we need to grit our teeth and allow some people to fail to take their opportunities. Countless teenagers who might have had a comfortable retirement will instead have the opportunity to smash up their red convertible on the way home from college. We absolutely must not deprive them of this risk, out of sympathy for its consequences. There will be plenty of Huns, Goths and Vandals watching what Rome does with its advantages.
* * * *
Suffice it to say a billion dollars will turn anyone's head; Health Savings Accounts are already many times that size in aggregate. Although ownership is dispersed widely, it is only a matter of time before some stockholders organization is formed, ostensibly to protect the interests of HSA owners. There will be an eternal need to suggest tweaks in the law to adjust to new circumstances. There will be a need to monitor the performance of managers, and even to counter the power of regulators. Sneaky little laws will get thrown in the hopper, requiring alarms in the night. Someone who lost money will sue to recover it; someone will have to decide whether to settle or resist in court, ever mindful of precedents being set. Executives will demand extraordinary life-styles; someone will have to decide if their production warrants the rewards. Someone else will have to be fired for incompetence or venality, but he will find many friends to defend him. The methods of selection of the board of directors are vital issues, now and forever in the future. As much as anything, continuous publication of results ("sunlight") is vital to oversight. The directors of the oversight body should have a deep suspicion of the directors of the "pearls" and only limited pathways for promotion between the two. Every time, every single time a dereliction is discovered, the results should be published and morals are drawn. Mr. Giuliani made a name for himself by policing broken windows, and it's still a very sound principle.
There is a financial success, and then there is product quality, which is different. Organizations will undoubtedly be formed to monitor quality, and these will produce measurable monitoring results. An effort should be made to make a meaningful match between these two report cards, with comparable groups having access to each other's data. There should be observers from each discipline on the other's board, and possibly a few voting overlaps. Disparities between rankings in the two evaluations should be explored and evaluated, and at least one annual meeting should be composed of both kinds of boards, devoted to the interaction of cost and quality. This may prove particularly fruitful at moments when scientific advances cause major changes in underlying premises. On another level, dialog should be frequent between research groups like the NIH, to see if research parallels needs..
A particularly interesting comparison might result from contrasting the regions with their 20% copayment partner's performance. They should be very similar, but may not prove to be.
109 Volumes
Philadephia: America's Capital, 1774-1800 The Continental Congress met in Philadelphia from 1774 to 1788. Next, the new republic had its capital here from 1790 to 1800. Thoroughly Quaker Philadelphia was in the center of the founding twenty-five years when, and where, the enduring political institutions of America emerged.
Philadelphia: Decline and Fall (1900-2060) The world's richest industrial city in 1900, was defeated and dejected by 1950. Why? Digby Baltzell blamed it on the Quakers. Others blame the Erie Canal, and Andrew Jackson, or maybe Martin van Buren. Some say the city-county consolidation of 1858. Others blame the unions. We rather favor the decline of family business and the rise of the modern corporation in its place.
Originally the "lower counties" of Pennsylvania, and thus one of three Quaker colonies founded by William Penn, Delaware has developed its own set of traditions and history.
Start in Philadelphia, take two days to tour around Delaware Bay. Down the New Jersey side to Cape May, ferry over to Lewes, tour up to Dover and New Castle, visit Winterthur, Longwood Gardens, Brandywine Battlefield and art museum, then back to Philadelphia. Try it!
Millions of eye patients have been asked to read the passage from Franklin's autobiography, "I walked up Market Street, etc." which is commonly printed on eye-test cards. Here's your chance to do it.
In 1751, the Pennsylvania Hospital at 8th and Spruce was 'way out in the country. Now it is in the center of a city, but the area still remains dominated by medical institutions.
Grievances provoking the American Revolutionary War left many Philadelphians unprovoked. Loyalists often fled to Canada, especially Kingston, Ontario. Decades later the flow of dissidents reversed, Canadian anti-royalists taking refuge south of the border.
