Special Report

Obama’s Rationing Man

President Obama's nominee to run Medicare and Medicaid has declared his love for Britain's health care system. Literally.

By 5.13.10

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While much of Washington is focused on President Obama's Supreme Court pick, Republicans are gearing up for a confirmation battle over another Obama nominee who promises to put health care back in the spotlight.

At issue is Obama's choice to head the Centers for Medicare and Medicaid Services, Donald Berwick, a Harvard professor with a self-professed love affair with Britain's socialized health care system. In his writings and speeches, Berwick has defended government rationing and advocated centralized budget caps on health care spending.

"Cynics beware, I am romantic about the (British) National Health Service; I love it," Berwick said in a July 2008 speech at England's Wembley stadium. "All I need to do to rediscover the romance is to look at health care in my own country."

While Berwick would not have the authority to impose a British health care system on the United States in one fell swoop, as head of CMS, he would be running both Medicare and Medicaid. Given that the two programs alone account for more than one out of every three dollars spent on health care in America (all government programs combined account for 47 percent), private players tend to follow CMS's lead. Berwick himself has made this point.

"(G)overnment is an extraordinarily important player in the American health care scene, and it has inescapable duties with respect to improvement of care, or we're not going to get improved care," he said in a January 2005 interview with Health Affairs. "Government remains a major purchaser.… So as CMS goes and as Medicaid goes, so goes the system."

There are two basic visions for how to contain the growth of health care spending. The free market approach would give individuals control over their health care dollars, with the idea that it would encourage more shopping that will drive down costs and increase quality as has happened in every other aspect of the consumer-based economy. But the other approach, employed by nations such as Britain, is to have the government ration care to meet a global budget.

President Obama rejected the market-based approach, and sought to drastically expand insurance coverage while reducing health care costs. But according to a report by CMS's chief actuary, the new law will actually increase health care costs. That leaves rationing of care based on a bureaucratic notion of the common good as the remaining option for containing skyrocketing spending, and it's an outcome that Berwick himself once predicted would be necessary to achieve universal coverage.

"(T)he Holy Grail of universal coverage in the United States may remain out of reach unless, through rational collective action overriding some individual self-interest, we can reduce per capita costs," Berwick wrote in an article for Health Affairs he co-authored in 2008.

He went on to write that, "The hallmarks of proper financial management in a system… are government policies, purchasing contracts, or market mechanisms that lead to a cap on total spending, with strictly limited year-on-year growth targets."

On a number of occasions, Berwick has praised Britain's National Institute for Clinical Excellence (NICE), a body of experts that advises the government-run health care system on how to allocate medical spending based on cost-benefit analysis. Among other decisions, they have ruled against the use of cancer-treating drugs and put a dollar value on the final six months of human life.

"NICE is extremely effective and a conscientious, valuable, and -- importantly -- knowledge-building system," Berwick said in an interview last June in Biotechnology Healthcare. "The fact that it's a bogeyman in this country is a political fact, not a technical one."

The national health care law that President Obama signed in March will greatly expand the role of CMS by adding an estimated 15 million beneficiaries to Medicaid. In addition, the law contains a number of initiatives, to be spearheaded by the Secretary of Health and Human Services in conjunction with the head of CMS, to provide incentive-based pay to doctors and hospitals based on performance. This builds on the comparative effectiveness research provision of last year's economic stimulus package. While none of these measures will have the same sway as NICE does in Britain, taken together, they will move America in a NICE-like direction, especially with Berwick at the helm.

In 2003, Berwick signed on to an open letter in Health Affairs, called "Paying for Performance: Medicare Should Lead." (Among his co-signers was Nancy-Ann DeParle, the current White House health care czar.) "Our recommendation-to the executive branch; to Congress; to employers and health plans; and to hospitals, physicians, nurses, and other health professionals -- is that payment for performance should become a top national priority and that Medicare payments should lead in this effort, with an immediate priority for hospital care," the letter read. It went on to say that the CMS administrator's successors must continue to show "aggressiveness and commitment" to the cause, noting that, "A major initiative by Medicare to pay for performance can be expected to stimulate similar efforts by private payers…"

The idea of paying doctors and hospitals for delivering better quality health care and of offering guidance on best practices seems benign enough. As the letter put it, "Quality is not an issue for partisanship." The problem arises when government bureaucrats or expert panels are in the position of judging quality, performance, and best practices which get applied across a broad and diverse population.

As cardiologist Sandeep Jauhar argued in a September 2008 New York Times op-ed, pay for performance initiatives can cause unintended consequences such as doctors overprescribing certain medications that are deemed effective and carry bonuses. He also recounted how an initiative in the early 1990s to give report cards to doctors performing coronary bypass surgery prompted doctors to cherry pick patients to avoid the most severely ill cases that could jeopardize their grades.

The problem with any uniform medical guidance is that what's good for the "average" patient may not be right for any given patient.

The irony in all of this is that Berwick, at times, has eloquently argued for what he called an "extremist" patient-centered approach to health care, in which hospitals wouldn't restrict visiting hours or force patients to wear gowns. As he said in a speech to the American Board of Internal Medicine in 2008 of the experience of a patient at a hospital: "That's what scares me: to be made helpless before my time, to be made ignorant when I want to know, to be made to sit when I wish to stand, to be alone when I need to hold my wife's hand, to eat what I do not wish to eat, to be named what I do not wish to be named, to be told when I wish to be asked, to be awoken when I wish to sleep."

Yet the term "patient-centered" is typically used by supporters of a free market approach to health care who argue for more individual choice and consumer empowerment. It's hard to think of a health care system in the world that dehumanizes patients more than Berwick's beloved British system.

In March 2009, a report found that up to 1,200 died as a result of "appalling standards of care" at just one hospital in Britain's NHS. The Telegraph reported that "patients (were) left for hours in soiled bedclothes.…" In addition, "Patients described one ward as a 'war zone' and said people were often left in Stafford's A&E (Accident and Emergency) for hours covered in blood and without pain relief, even though they had serious injuries. Others were left without food or drink, leading some to reportedly drink from vases when thirsty."

In November, another report estimated that up to 400 patients a year died at two other hospitals, with similar conditions that included, according to the Telegraph, "lack of basic nursing skills, curtains spattered with blood on wards, mould in vital equipment and patients being left in A&E for up to ten hours."

During the health care debate, Obama dismissed any attempt by Republicans to liken his vision to the British system. But Berwick's nomination, which will have to be approved by the Senate, provides Republicans with ample fodder to make the connection.

On Wednesday night, Sen. Minority Leader Mitch McConnell took to the floor for a half-hour along with fellow Republican Sens. Pat Roberts and John Barrasso to rip into Berwick's positions, in what could be seen as the opening salvo in the nomination battle.

"Many of us are alarmed by the nominee's focus on the British health care system," McConnell said, and criticized Berwick for "applauding a system where care is denied, delayed, or rationed."

McConnell also suggested that Obama intentionally delayed the Berwick appointment until after the passage of the health care law, because announcing his CMS pick during the debate would have confirmed Republican charges that Democrats were intent on rationing care.

Berwick will have to first pass muster with the Finance Committee, which oversees Medicare and Medicaid. A hearing has yet to be scheduled.

Though the nomination of Elena Kagan to the Supreme Court is likely to garner more attention, the Berwick pick could produce more fireworks. In Berwick's case,  there's a long paper trail detailing his disturbing views on a wide range of matters relevant to the position he's seeking.

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About the Author

Philip Klein is The American Spectator's Washington correspondent. You can follow him on Twitter at: http://twitter.com/Philipaklein