Saturday, April 23, 2016

John Stossel Discovers Health Care Dysfunction, Blames it on "Socialists" - Like Maurice Greenberg (AIG), John Thain (Merrill Lynch), Sanford Weill (Citigroup), and David H Koch?

We have been ranting for a while about the dysfunctionality of the US health care system.  Unfortunately, many people only realize how bad things are when they become patients, when they have bigger things to worry about than complaining.   Furthermore, even if they complain, many patients may not feel they understand enough about what has gone wrong to suggest solutions.

Bad Customer Service at New York Presbyterian

This may not apply when media pundits, especially those with strong ideological views, become patients.  So this week Fox News commentator and well known libertarian John Stossel disclosed his new illness, and vented his opinions about his hospital stay.   Mr Stossel unfortunately developed lung cancer, although he was optimistic about his prognosis: "My doctors tell me my growth was caught early and I'll be fine. Soon I will barely notice that a fifth of my lung is gone."

However, he was not happy about his hospital's customer service:

But as a consumer reporter, I have to say, the hospital's customer service stinks. Doctors keep me waiting for hours, and no one bothers to call or email to say, 'I'm running late.' Few doctors give out their email address. Patients can't communicate using modern technology.

I get X-rays, EKG tests, echocardiograms, blood tests. Are all needed? I doubt it. But no one discusses that with me or mentions the cost.


I fill out long medical history forms by hand and, in the next office, do it again. Same wording: name, address, insurance, etc.


In the intensive care unit, night after night, machines beep, but often no one responds. Nurses say things like 'old machines,' 'bad batteries,' 'we know it's not an emergency.'


Some of my nurses were great -- concerned about my comfort and stress -- but other hospital workers were indifferent.
Unfortunately, long wait times, poor communications, excess paperwork, and misapplied technology are all too familiar problems to those in the health care system.

Moreover, this all was happening at one of the most highly rated US hospitals, 

After all, I'm at New York-Presbyterian Hospital. U.S. News & World Report ranked it No. 1 in New York.

Were "Socialist Bureaucracies" Responsible?

Mr Stossel had his own ideas about the causes of these problems. 

Customer service is sclerotic because hospitals are largely socialist bureaucracies. Instead of answering to consumers, which forces businesses to be nimble, hospitals report to government, lawyers and insurance companies.

Whenever there's a mistake, politicians impose new rules: the Health Insurance Portability and Accountability Act paperwork, patient rights regulations, new layers of bureaucracy...


Leftists say the solution to such problems is government health care. But did they not notice what happened at Veterans Affairs? Bureaucrats let veterans die, waiting for care. When the scandal was exposed, they didn't stop. USA Today reports that the abuse continues. Sometimes the VA's suicide hotline goes to voicemail.

Patients will have a better experience only when more of us spend our own money for care. That's what makes markets work.
A "Socialist Bureaucracy" with a VIP Penthouse?

I am sorry to hear Mr Stossel has lung cancer, and hope that his prognosis is indeed good.  I am a bit surprised that a media celebrity who became a patient found big issues with "customer service" at such a prestigious hospital.  After all, many big hospitals have programs to give special treatment to VIPs (for example, see these posts from 2007 and 2011).

In particular, back in 2012 we posted about the contrast between the VIP services specifically at New York - Presbyterian Hospital and how poor patients are treated there.  Then we quoted from a 21 January, 2012 article from the New York Times focused on the ritzy comforts now provided for wealthy (but perhaps not very sick) patients at the renowned New York Presbyterian/ Weill Cornell Hospital.  It opened,

The feverish patient had spent hours in a crowded emergency room. When she opened her eyes in her Manhattan hospital room last winter, she recalled later, she wondered if she could be hallucinating: 'This is like the Four Seasons — where am I?'

The bed linens were by Frette, Italian purveyors of high-thread-count sheets to popes and princes. The bathroom gleamed with polished marble. Huge windows displayed panoramic East River views. And in the hush of her $2,400 suite, a man in a black vest and tie proffered an elaborate menu and told her, 'I’ll be your butler.'

It was Greenberg 14 South, the elite wing on the new penthouse floor of NewYork-Presbyterian/Weill Cornell hospital. Pampering and décor to rival a grand hotel, if not a Downton Abbey, have long been the hallmark of such 'amenities units,' often hidden behind closed doors at New York’s premier hospitals. But the phenomenon is escalating here and around the country, health care design specialists say, part of an international competition for wealthy patients willing to pay extra, even as the federal government cuts back hospital reimbursement in pursuit of a more universal and affordable American medical system.

Additional amenities include:
A waterfall, a grand piano and the image of a giant orchid grace the soaring ninth floor atrium....

the visitors’ lounge seems to hang over the East River in a glass prow and Ciao Bella gelato is available on demand....

An architect who specializes in designing such luxury facilities for hospitals noted:
'These kinds of patients, they’re paying cash — they’re the best kind of patient to have,' she added. 'Theoretically, it trickles down.'
It appears that someone failed to book Mr Stossel into the penthouse.  Instead, he found out what service was like for the masses.

Perhaps this was why Mr Stossel railed at the "socialist bureaucracies" he perceived as running New York - Presbyterian Hospital.  However, calling the hospital management "socialist" seems - not to put too fine a point on it - wrong.

A "Socialist Bureaucracy" Paying Millions to its CEOs?

First of all, New York Presbyterian is hardly a government agency.  It is a private, non-profit corporation.  Every year as such it files a form 990 with the dread US Internal Revenue Service. (The latest publicly available version is from 2013, here.)  Obviously, US government agencies do not file with the IRS.

In fact, the New York Presbyterian system seems about as far from a federal government agency as one can imagine.

First, its top managers are paid like for-profit corporate executives.  In 2014, we posted about the humongous compensation given to its previous, long-serving CEO, Dr Herbert Pardes, who received multi-million dollar compensation every year through his 2011 retirement, and then continued to receive several million a year from the system in his retirement.  His successor, current CEO Dr Steven Corwin, received $3.6 million in 2012.  (More recent compensation figures are not yet available.)

A "Socialist Bureaucracy" Dominated by Managers, with Stewardship by Top Financial Executives, and one of the Koch Brothers?

The current leadership of New York Presbyterian is dominated by businesspeople, not physicians, nurses, or other health care professionals.  Only 10 of 33 listed senior leaders are health care professionals.  The rest have administrative/ management or legal backgrounds and training.  Many appear to be generic managers, that is, people with background and experience primarily in administration or management, but not in medicine, health care, public health, etc.

The hospital system's board of trustees was and is filled with some of the top business executives in the US, including some finance executives who have been cited as responsible for the global financial collapse/ great recession.

For example, we wrote about Mr Dick Fuld, a trustee until recently.  Mr Fuld was the CEO who presided over the bankruptcy of Lehman Brothers, which heralded the beginning of the great financial crisis/ great recession of 2008 onward.  Mr Fuld seemed to lack the sort of compassionate approach one might expect from someone charged with the stewardship of a big hospital system.  He had once publicly said about those who sold Lehman Brother stock short: "what I really want to do is I want to reach in, rip out their heart, and eat it before they die."

Another recently retired board member was Sanford I Weill, architect of the mergers that created the now federally bailed out Citigroup.  In 2014, we posted about how Mr Weill, contemplating retirement from the board of trustees of Weill Cornell Medical School, one of the two medical schools with primary affiliations with New York Presbyterian, managed to bequeath his board seat to his daughter, Ms Jessica Bibliowicz, also the CEO of a finance firm, National Financial Partners.  Ms Bibliowicz now also seems to have Mr Weill's seat on the New York Presbyterian board. 

Also, still on the board are two top finance CEOs who have been blamed for the global financial collapse.  These are  Maurice R Greenberg of the federally bailed out AIG, and John A Thain, CEO of the nearly collapsed Merrill Lynch (merged into Bank of America).  See this post for more information about their roles in the global financial collapse.

Finally, one other board member is David H Koch, described by Wikipedia

Koch is an influential libertarian. He was the 1980 candidate for Vice President of the United States from the United States Libertarian Party and helped finance the campaign. He founded Citizens for a Sound Economy. He and his brother Charles have donated to political advocacy groups and to political campaigns, almost entirely Republican
With socialists like these ...?   


I do not doubt that John Stossel found the customer service at New York Presbyterian not up to his expectations.  And I actually have no doubt that New York Presbyterian has to operate within a complex health care system in which government bureaucracy plays a large role, and sometimes a counter-productive one.  Furthermore, I have no doubt that the management of New York Presbyterian is very bureaucratic, and this may in part may be a reason for poor customer service, and other failings.

However, to say that the management and governance of the hospital system is "socialist" is dead wrong.  In fact, like many other large health care organizations, the New York Presbyterian system appears to be run largely by "managerialists," that is generic managers who have little experience or background in health care, may have little understanding or sympathy for its values, and approach health care with the same management techniques that might be applied to selling soap powder.  Furthermore, the stewardship of this particular hospital system seems to be largely up to some of the biggest, and loudest "capitalists," and one of the most prominent "libertarians" in the US.

But to someone with a hammer, most problems look like nails.

Maybe Mr Stossel needs to complain to Mr Koch.

In conclusion, I am glad that some of the problems in the dysfunctional US health care system are getting more public attention.  However, now we need to calmly and rationally consider what is causing them and what to do about them without the blinders of ideology or vested interests. 

IMHO, true US health care reform would put the operation of US health care organizations more in the hands of people who have knowledge and experience in health care, and are willing to be accountable to support health care professionals' values.  Furthermore, oversight and stewardship of these organizations should represent the patients and public which the organizations are supposed to serve. 


Less Afraid said...

Great post, minimal to no snark. We all see the problems so on that we are all one body. And how can one argue with healthcare knowledgeable people leading us out of this mess we are all in?

Together, we can get this to work out.

Maybe we as a society are on the verge of beginning to heal healthcare.

InformaticsMD said...

Stossel's comment would have perhaps been appropriate if it expressed that the management was *as ineffective as* and indifferent as a socialist bureaucracy in terms of human interaction. But he should also be made aware that managerialism is a large part of the problem.

Anonymous said...

The indifference arises from the intense attention required by the staff to tend to the demands of the EHR, the defacto patient.

David Z said...

CEOs receive large salaries because they bring in large amounts of donor funds through their contacts. The board members that you mention are/were wealthy and are presumably large donors, especially Mr. Weill of Cornell Weill Medical Center.

In most cases, it is not the patient that is the "customer" of the hospital, but their doctor. It is the doctor (and only indirectly the patient) that the hospital must please otherwise the doctor (within the constraints of insurance) will move on to a different hospital.

This is the case for fee-for-service hospitals like NYP.

Integrated health providers such as Kaiser Permamente which employs their physicians can focus more on pleasing their customers who are generally the employers with their employees and families, eg, patients. This is also true for Mayo and Cleveland Clinic which also employ their doctors.

I presume you know these facts but decided not to state them for some reason.

Roy M. Poses MD said...

David Z, whoever you are --

Some of your "facts" may apply to some hospitals, e.g., that CEOs may be valued primarily for their fund-raising, board members may be chosen primarily for their fund-raising, and hospital management may not consider patients to be their "customers."

But if true, is this any way to run health care?

Hospitals were built to take care of patients. Even modern corporate hospitals' mission statements often may say they put their patients first. Shouldn't they? Board members are supposed to exercise stewardship over hospitals and the patient care are they provide. Are the wealthiest donors most suitable to do this? CEOs may put revenue over all other considerations. Should they?

For examples, see:

I would submit, however, that the days in which hospital managers feel they must please physicians ahead of patients, or please physicians at all, are gone. Most hospitals are run by generic managers, and many are neither patient- nor physician-centric.

Look at:

Anonymous said...

You are correct, I can't speak for the running of most hospitals and should have said regarding most of the larger hospitals/hospital groups in larger cities for example, New York City, Long Island, Boston, (and I presume Chicago, LA, ......).

The CEOs should in theory hire professional managers that are competent at running hospitals and the wealthy board members who are on the board while able to vote, probably defer to the professional managers on operational issues. I could imagine the wealthy board members getting more involved when hospitals merge (eg, NYP and Cornell) or purchase other hospitals (eg, Mt. Sinai NYC purchasing Continuum Health) -- that is when large amount of funding is involved.

As I originally stated, at least in a competitive hospital market, the hospitals must please doctors who are not employees of the hospitals because hospital revenues depend on the patients that the doctors bring to the hospitals. Make a decision that displeases doctors and they'll simply go to a competing hospital (eg, hospital shopping). This would be especially true for neurosurgeons who are relatively rare and bring large revenues to hospitals but it is true of any other doctor who brings revenues to hospitals.

Do you agree with my comments about Kaiser, Mayo, and Cleveland?

Perhaps Mr. Stossel should consider transferring to a doctor at Memorial Sloane Kettering Cancer Center.

Roy M. Poses MD said...

Anonymous of April 26 (perhaps David Z?) -

I agree that in a competitive market, the hospitals may have to please physicians who are seen as big revenue generators, e.g., cardiologists, orthopedic surgeons, etc. Of course, many markets are not competitive, but are dominated by a few big hospital systems. And even "revenue generating" physicians may have a tought time practicing outside of hospital employment in such markets. Further, these days, physicians judged as not likely to produce such revenue may have little to no say about anything, yet what they do may be as vital to patients' outcomes as what other specialities do. Finally, who is revenue generating vs who is not is determined by what some may think are arbitrary decisions on physician payments made by CMS at the behest of the AMA's RUC, and the RUC's members are dominated by currently "revenue producing" physician subspecialists, who may also have significant conflicts of interest (financial relationships with drug/ device/ biotech companies, etc). See:

This is the way things are, but is this the way things should be?

I agree re Kaiser, which operates as a combined insurance/ managed care company and hospital system and physician group. I am not as familiar with how the Mayo and Cleveland Clinics operate.

afraid said...

Anonymous of April 26th and Dr. Poses:
I can't abide a board of directors that defer to managers with no experience caring for patients. At a minimum, the Board is responsible for hiring and overpaying. Boards set up the incentive programs that damage healthcare.

Sorry, they are in charge and can not discharge that responsibility with a claim of "we don't know healthcare well enough". Because if that is true, they should not be Board Members because they simply don't qualify.

It's not a valid excuse for the Board ... IT IS THE PROBLEM.