Healthcare Reform – What are we Talking About?, A Controversial Conversation with Phelps Memorial’s Keith Safian

Irvington, Tarrytown, Sleepy Hollow and every other community across the United States are joined at the hip when it comes to the Healthcare issue. Healthcare transcends race, creed, socio-economics and political affiliations.

imagesIn short, Healthcare, or the lack thereof, affects every living soul.

Keith Safian, President and CEO of Phelps Memorial Hospital Center, has collected and interpreted a significant amount of information on our current nationwide Healthcare system. The findings question the need for sweeping change – particularly by the Federal government whose track record in oversight and management is justifiably suspect.

While Westchester County has seen a decline in hospital services through department cutbacks (Dobbs Ferry Hospital), large budgetary shortfalls (Westchester Medical Center) and, in extreme cases, closures (United Hospital in Port Chester and St. Agnes Hospital in White Plains), Phelps Memorial has not only grown but it has been profitable for eighteen out of the last nineteen years. In 2008, the hospital recorded its highest revenue ever of $165,377,000. That success can be attributed in large part to Safian’s stewardship. The reasons for the Hospital Center’s success are, in and of themselves, a complete story. For the sake of this article, we will focus on Mr. Safian’s factual account of the current Healthcare System and then conclude with alternatives for greater efficiency and reduced costs—end goals everyone agrees are desperately needed.

If one compares “operating margins” for New York hospitals, the figures reveal the Empire State ranks near the bottom of all the States with only Nevada being worse. “If there is no margin, there is no mission. Excellent healthcare costs money,” Safian noted. How that healthcare money is spent, and with what kind of results, is the jumping off point for this article and its controversial tone.

Take “limitless care” which by definition is expensive. Citing the New England Journal of Medicine, healthcare costs for preterm infants were $18.1 billion in 2003. The annual societal economic cost (medical, educational, lost productivity) of preterm births was at least $26.2 billion in 2005. Of the smallest premature babies, 80 percent have impairment of some type and 41 percent of the extremely premature group have severe or moderate mental impairment at six years of age. “We as healthcare providers do everything we can to keep people alive. We are trained to do that. The United States also treats patients that other countries do not,” Safian said. In his own life, he told his wife’s obstetrician that if their child were born with a severe abnormality, to let nature take its course and to let their baby die rather than put it on a respirator to keep it alive against insurmountable odds. It was a quality of life issue for the baby and the entire Safian family. As for an alternative to limitless care, Safian said, “Let’s see if there is a panel of experts from across the country who can agree on where the cutoff shifts from limitless to limited care. If they’re able to do that, they can hand the government one solution to lowering healthcare costs. It’s a tough bullet to bite but it’s a way that we can address not only costs but quality of life issues and the severe impact on families,” he said.

Turning from the very young to the old, Keith Safian produced an article written in a widely-read and respected national publication. “The article tells you how you can hide your house from Medicaid so that Mom can get into a nursing home and the children can inherit the house.

The rest of us then pay for this woman’s nursing home costs. These kinds of legal abuses drive up healthcare costs when people with assets should use them for their nursing home care. I think that this should not be something the legal profession endorses or the state tolerates. If you have assets, they should go towards your nursing home care and when those assets run out, then there’s Medicaid. This is one of the examples that drive up Medicaid costs—when people are able to pay for their nursing home care and don’t. My point on this issue is that these legal loopholes should be closed,” Safian said. (Medicaid is a health program for eligible individuals and families with low incomes and resources. It is jointly funded by state and federal government, and is managed by each state. With the aging of the Baby Boomer population, the fastest growing aspect of Medicaid is nursing home coverage.)

Another controversial issue for reducing healthcare costs is the limiting of coverage under Medicare. (Medicare is a social insurance program administered by the United States government. It provides coverage to people who are 65 years of age and older, or to those who meet other specific criteria.) For cancer patients, chemotherapy can cost up to $100,000 per patient per year and over 20 percent of Medicare patients fall into this

category. In the last month of life, 43 percent of patients receive chemotherapy in the United States while 20% of patients receive chemotherapy in the last two weeks of their lives. “We are giving chemotherapy to people who have virtually no chance of benefitting from it. Why do we do it? Because that’s what the patient wants. In the United States, whatever the patient wants we give them. There is a huge price tag for that,” Safian said.

” Besides the cost, patients really suffer from the side effects of chemotherapy in the last stages of their lives,” he added.

For Safian, setting a national criteria on limiting Medicare and Medicaid coverage for the terminally ill must be considered. He supported the claim by citing the fact that the United States has the highest rate of new treatment in the world for ESRD (end stage renal disease). The treatment, known as hemodialysis, is used as an artificial replacement for lost kidney function. “There are 300,000 dialysis patients in the United States. Our country accepts twice as many patients as Europe does where the treatment of ESRD is rationed by age, gender and co-morbidity,” Safian said. Costs for ESRD rose to $23 billion in 2006 with hemodialysis costs amounting to $71,889 per year per patient. “These patients have to go three times a week for treatments that go on for hours. They have a very poor quality of life but, without it, they will die,” he noted. Increasing organ donation is one answer to ESRD. Once again, the bitter pill of limiting coverage for those who are terminally ill is the other alternative.

Shifting away from patient care and towards the administrative side of the healthcare system, both tort reform and insurance companies need to be addressed. Tort reform refers to proposed changes in the justice system to reduce litigation and/or compensation awards. It is a highly volatile political issue and those who support it want to place limits on the ability to file claims, and cap the awards for damages. “At Phelps, we pay $160,000 per year in malpractice premiums for an obstetrician and that’s for a doctor with no medical malpractice claims. Is that good use of healthcare dollars?” Safian asked. Excessive litigation in healthcare adds $124 billion to expenditures. “We need to put a cap on pain and suffering awards,” Safian said. As for insurance companies, he was quick to point out that they receive healthcare dollars but provide no healthcare. “$230 billion in healthcare spending nationally is devoted to insurance administration. Administration consumes 31 percent of U.S. health spending,” Safian stated. Administrative costs are four times higher with private for-profit healthcare providers as compared to Medicare. Safian’s call to action on this issue is to let employers buy Medicare for their employees. He believes insurance companies like Blue Cross and many others would quickly lower premiums and their administrative expenses if they had to compete against a national plan. For Keith Safian, the United States Healthcare System has been maligned and he can readily cite multiple examples of its benefit and worth to those it serves. He believes that the American consumer may be the biggest enemy of the Healthcare industry with their insatiable appetite for greater and greater treatment demands. He also realizes that federal government’s attempt to institute a new healthcare bureaucracy is not the answer. According to him, mechanisms exist within the current healthcare system to reduce costs and to increase the quality of life of those served. He is in favor of primary care for middle class people who have lost their insurance. He cites a host of programs locally that serve the indigent population. Phelps Memorial has partnered with these programs to provide medical services to those patients who cannot afford to pay. He knows that serving the underserved is possible on a larger scale. Lastly, he highly recommends that residents write and email their elected officials on county, state and federal levels. “The mechanisms for change within the current healthcare system exist. It’s up to the people to let their lawmakers know that. No one has more influence with politicians than their constituents. This is not a party issue. It is a fundamental issue. Everyone should have health coverage and, if they don’t have it through their job, they should be able to buy it based on their ability to pay for it. But again, I would say let’s stick with the existing government programs,” he concluded.


Let Them Hear From You

Listed below are the names, addresses and email addresses of your elected officials.

New York State Senate
Hon. Vincent L. Leibell
40th Senate District
Phone: 914-245-6230
Towns: Buchanan, Crompond, Croton-on-Hudson, Ossining, Peekskill, Verplanck

Hon. Andrea Stewart-Cousins
35th Senate District
Phone: 914-771-4190
Fax: 914-771-6045
scousins@senate.state.ny.us
Towns: Ardsley-on-Hudson,
Briarcliff Manor, Dobbs Ferry, Elmsford, Irvington,
Pleasantville, Tarrytown, Sleepy
Hollow, Hastings-on-Hudson

Hon. Suzi Oppenheimer
37th Senate District
Phone: 914-934-5250
oppenhei@senate.state.ny.us
Towns: Briarcliff Manor,
Maryknoll, Millwood, Ossining

New York State Congress
Hon. John Hall
19th Congressional District
Phone: 845-225-3641
johnhall.house.gov/emailjohn.asp
Towns: Buchanan, Crompond, Croton-on Hudson, Peekskill, Verplanck

Hon. Nita M. Lowey
18th Congressional District
Phone: 914-428-1707
Towns: Briarcliff Manor, Dobbs Ferry, Elmsford, Irvington, Maryknoll, Millwood, Pleasantville, Tarrytown, Sleepy Hollow, Hastings-on-Hudson

Hon. Eliot L. Engel
17th Congressional District
Phone: 914-699-4100
www.house.gov/writerep/
Towns: Ardsley on Hudson, Dobbs Ferry, Irvington,
Tarrytown, Sleepy Hollow,
Hastings-on-Hudson

New York State Assembly
Hon. Richard L. Brodsky
92nd Assembly District
Phone: 914-345-0432
brodskr@assembly.state.ny.us
Towns: Ardsley-on Hudson,
Briarcliff Manor, Dobbs Ferry, Elmsford, Irvington, Pleasantville, Tarrytown, Sleepy Hollow, Hastings-on-Hudson

Hon. Adam Bradley
89th Assembly District
Phone: 914-686-7335
bradlea@assembly.state.ny.us
Towns: Briarcliff Manor,
Croton-on-Hudson, Maryknoll,
Millwood, Ossining,
Pleasantville

Hon. Sandy Galef
90th Assembly District
Phone: 914-941-1111
galefs@assembly.state.ny.us
Towns: Briarcliff Manor, Buchanan, Crompond, Croton- on Hudson, Ossining, Peekskill, Pleasantville, Verplanck

Hon. Greg Ball
99th Assembly District
Phone: 845-279-5301
ballg@assembly.state.ny.us
Towns: Croton-on-Hudson,
Ossining

Hon. Mike Spano
93rd Assembly District
Phone: 914-779-8805
spanom@assembly.state.ny.us
Towns: Hastings-on-Hudson

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About the Author: Robert Bonvento