Kicking the Can (15 page)

“Health care is an honorable profession. Physicians are compassionate, capable, and hardworking—but they pay attention to financial incentives, and they have
the intellectual horsepower and resources to adapt quickly,” Lowsley said.

“Fifteen-all.”

Vogel hit a smashing serve. Lowsley was able to put his racket on the ball, but Drummond hit down on the ball and it flew into the net.

“Drummond, you stink,” Vogel said.

Drummond wiped the perspiration from his upper lip. Baturina and Jiang were laughing.

“Drummond, you play like stinky girl,” Jiang yelled.

Drummond, Lowsley, Gupta, and Vogel took a break from the match and walked over to the edge of the court. They sat down on two benches next to the circular table where Jiang and Baturina were seated. Drummond wiped his face with a towel and wrapped it around his neck.

“Physicians and hospitals have been paid a fee when a service is provided. Financial gain from fee-for-service reimbursement incents volume. The more procedures and office visits performed, the more revenue is generated. According to OECD, health care workers in this country are paid a fifty percent premium compared to health care workers in other countries. We don’t have to resolve the payment scheme dilemma. We transfer the problem to ACOs by insisting on global budgets. My prediction is ACOs will continue to transition physicians to salaried positions, with modest incentives tied to patient visits,” Lowsley said.

“I looked up the business codes for health care businesses. Gupta, you can use these codes to access the tax returns on file with the Internal Revenue Service. I also have access to the Physician Practice Management
Association’s Cost Surveys—it’s a subscription service,” Drummond said.

“Drummond, why don’t we let Wonder Woman and Superman duke it out? We’re making asses of ourselves,” Gupta said.

55

S
heryl Vogel took a seat at Drummond’s table—a morning ritual.

“Did you watch the press conference last night?” Vogel asked.

“No.”

“It’s available on the congressional website…worth viewing. It was an exclusive interview with Haines—Bennett was suspiciously absent. Those two are normally inseparable.”

Vogel stabbed a piece of fresh pineapple and popped it in her mouth, followed by a spoonful of strawberry yogurt and granola.

“Haines intends to give weekly updates…Committee’s been working for seven days now, he claims fourteen-hour days, and they’re making good progress.”

“Did he provide details?”

“He said they’ve agreed in principle to a framework of one dollar in health care spending cuts for every four dollars in revenue increases,” Vogel said.

“It will concentrate a war chest in the hands of a few politicians!”

“You guessed it—crony capitalism at its finest. The super committee doesn’t need congressional approval…earmarks for their favorite states?”

“What a waste—it will be the death knell for US competitiveness. President Cannon’s suspicions were right on,” Drummond said.

“After Haines’s press conference finished, they interviewed Dr. Janet Duncan, the new HHS director. She offered a much different perspective. She showed the same OECD graph that you and Lowsley put up—the US as an outlier. In her opinion, as a practicing physician and medical director for twenty years, the solution wasn’t to throw more money at the problem. She referenced four articles, all from different health care experts, who’ve corroborated a third of all US health care expenditures are a waste. She also showed a graphic that compared US quality measures versus the OECD mean, and in many instances, our quality was substandard. It was a very effective message. Haines and Bennett won’t get a ‘free pass’ with Duncan around.”

56

C
live Donald sat across from Speaker Bennett. The interior of Donald’s jet black Sikorsky S-76B helicopter was posh—camel leather seats and wool carpeting. It was a glorious evening for a flight over Manhattan. The sleek craft lifted off the helipad of Donald Tower. The cabin pitched forward and banked softly to the left for a loop around Liberty.

“What’s on your mind, Speaker? You asked for the meet.”

“A private, Nobel-style competition is going to come across as a ‘star chamber.’ Americans will perceive it as a gimmick to pick something that already matches the undisclosed preferences of the competition sponsor. Whatever health care reforms your judges pick will be DOA in Congress, because we can easily shoot it down. President Cannon has the same problem. It can’t be an executive office commission either, for the exact same reason.”

Donald was peering out the window of his Sikorsky, feigning little interest in Bennett’s dogma.

“My sources tell me Cannon’s HHS director is working on a website—hush-hush. Cannon’s smart, he knows an open, crowd-sourced competition done on
the
whitehouse.gov
website, the same way as President Obama’s administration did with their petition website where anybody could submit any petition they like and the public votes on it, is his best tactic to checkmate my super committee. That way, whatever idea wins, no matter how radical, automatically comes with the stamp of approval of the American People-with-a-capital-P. My Congress can try to shoot it down, but when they do, Cannon need only repeat ad nauseam, ‘this is the solution chosen by the American People themselves, who elected me to lead this nation, and to whom I swore my service.’ He can hammer on the idea that Congress, elected to represent the states and the people, is going directly against those people if they reject the idea. The people will love it. His ratings will go through the roof; Congress’s will tank even further. Eventually, they’ll cave rather than lose their jobs and personal power.”

Bennett stopped talking to view the skyline. Donald believed the silence was intended to make his statements more impactful.

“Health care is a complex industry. Americans can choose the health care system they want, but they’ll need help from policy experts to understand the best options. Cannon’s best bet would be to have several options prepackaged and posted on the White House website. That way the American people can vote on the options and pick the winner.”

The helicopter turned north past the Empire State Building, past Central Park, past Yankee Stadium, making a wide turn to the east then turning south back toward Donald Tower.

“Donald, why not take the millions you pledged toward a third-party candidate in your press conference and invest in your own public service career? I can’t imagine a better candidate for governor of New York. Personally, I think you would be unbeatable with the right political connections…particularly, if you were to join forces with the super committee. Why not align your competition with the committee’s efforts and ride the wave of popular momentum when we solve America’s greatest economic threat?”

57

O
n Saturdays between 6:05 a.m. and 6:50 a.m., Dr. Janet Duncan’s routine was to leave her house and jog a four-mile loop. This morning it was a route near her home in an upscale DC suburb in Virginia. They kept their home in Minneapolis, and she and her husband alternated flying back and forth every other weekend. Ken Duncan had flown to DC the weekend before. At 6:22 a.m., she left the house. The neighborhood was still sleepy. She was a mile and a half into her run when she first noticed the bird out of her peripheral vision. It came from behind and to her right, passing inches from her ear, before veering right and disappearing behind a Mockernut Hickory tree. She didn’t think too much of it, until it happened again, less than a block away from the initial incident.

Davis was in a white van with two associates, two miles from Duncan. The van was nondescript, except for the unusual antennae array mounted to the rooftop. They were creeping along at less than twenty miles per hour on a street parallel to Duncan. Monitors displayed video streaming real time from two cameras. Davis had witnessed the bird swoop down on Duncan from the video monitor in the van. On closer examination, it was not a
bird at all; it was an unmanned aerial vehicle made to look like a hummingbird, and one of Davis’s associates was operating the drone with a sophisticated controller that resembled what RC-airplane enthusiasts used.

Davis was a believer in the benefits of technology—force multiplier—leveraging technology to replace people. He often quoted from the documentary
Rise of the Machines
, aired by NOVA: “If it was dirty, dangerous, or dull, employ a drone to do the work.”

Originally designed to be a surveillance platform, “bad actors,” had quickly discovered more intrusive applications.

Davis had devised a system that combined surveillance with offensive capability, and he was testing his creation this morning. Duncan had stopped jogging and was now standing still. Buzzing around her, like Tinkerbelle, the hummingbird captured her complete attention, hovering two feet above, just out of reach. She was looking up, mesmerized. The hummingbird was emitting a thread-size beam of light that first showed on Duncan’s running singlet before moving up her shoulder and disappearing underneath her chin, and it was now pinpointed on the carotid artery in her neck. She could not have seen the quad-rotor on autopilot, its titanium blades spinning at eight thousand revolutions per minute, traveling at forty-two miles per hour, locked onto the target by laser-guided GPS. She would have heard the buzz, a beehive rumble, comparable to a formula-one race car engine, just before impact.

Duncan reached to grab her neck with her right hand, but she lost her balance, falling to the grass. She
attempted to scream, but the only sound Davis heard was gurgling and the hum of the drone’s wings as it hovered above Duncan recording the lethal attack. The wound resembled the gash left by a boa knife with serrated blade. Duncan lay in agony, blood continuing to pump out the severed artery in her neck until she bled out. The video feed had been shunted to Bennett’s smartphone, where he watched the events unfold real time.

The white van accelerated. The crew needed to retrieve the drones. Davis and his associates discussed the names of killer drones bantered about on NOVA’s program as they sped to recover GPG’s latest weaponry. Davis’s killing masterpiece was named “Necktie.”

The police would later rule the homicide a “random act of violence,” possibly gang related. Dr. Duncan’s stint as HHS director lasted four months and eight days. The deputy director took over her position.

58

P
eter Lowsley selected another cue stick and rolled it across the felt to make sure it was true. He picked up the blue chalk cube and struck the end of the cue stick repeatedly, like lighting a wooden match.

“Drummond, your premise—a high fixed-cost cost structure spurs volume—is a revelation in health care research…doesn’t exist in the literature to my knowledge. Something a CPA would pick up on.”

“I estimate forty to sixty percent of hospital and physician costs don’t vary with changes in patient and procedure volume. Profits are sensitive to changes in volume in high fixed-cost industries.” Lowsley drew the stick back until the tip was nigh an inch from his chalked finger and then stabbed the cue ball, releasing enough kinetic energy to explode the triangular pattern into a starburst, propelling balls in all directions. The orange 5-ball dropped into the side pocket.

“I’m solids.”

“Your hospital example is demonstrative—there’s tremendous pressure to fill beds ‘at the margin,’ because of the financial risk-reward ratio. Incremental volume is low-hanging fruit.”

Lowsley banked the 7-ball into the corner pocket and continued to circle the table, scouting his next shot.

“Coupled with the fact hospital reimbursements have been set by Medicare Cost Reports, and voilà—an explanation for mammoth hospital campuses. Medicare’s reimbursement scheme encourages continued expansion.”

Lowsley sank the 9-ball in the corner pocket but failed to put enough English on the cue to avoid scratching. He spotted the 9-ball on the table and handed the cue ball to Drummond.

“The average census among community hospitals according to the American Hospital Association is less than seventy percent—on any given day, only seven of ten beds are filled. A hospital with forty percent fixed costs can reduce its total costs by ten percent and double its profits if it operated at ninety-five percent capacity. Excess capacity is expensive. The potential savings are significant if capacity can be removed from the system.”

Drummond lined up the cue on the 1-ball and drilled it into the corner pocket.

“The airlines used ‘bankruptcy and consolidation’ to remove capacity to increase loads, and the industry’s now profitable after decades of losses—but there’s no precedent for hospital bankruptcies.”

“Not yet.”

“If we can compress the significant variation in Medicare surgical payments between high-cost and lost-cost hospitals that’s well documented in the medical literature and force the industry to jettison excess capacity, the savings to the system will be huge. We transition from
‘filling the beds’ mentality to keeping patients out of the hospital; it’s the largest piece of the health care pie.”

“Best of three?”

“I’ll make a notation for Gupta to access Medicare Cost Reports and the hospital cost surveys on file with the states’ Offices of the Insurance Commissioner,” Drummond said as he reracked the balls for another game.

59

C
hris Drummond and Peter Lowsley had hyped the afternoon session. Even Dain was present for what was dubbed the ‘Futuristic Health Care Informatics’ unveiling.

“Gupta is a gifted technologist. He has a penchant for adapting existing technologies to new markets and applications. We asked him to envision a health care system where data is ubiquitous and stored in a health history unique to each patient. Without further ado our technology imagineer.”

Everybody clapped, except Jiang, who so far appeared not to have forgiven Gupta for the fart phone incident.