This issue is the last Modern Healthcare will publish in 2005. As usual, we offer readers a look back at the year in our Special Report, beginning on page 26. You will also find the top five stories of the year as chosen by respondents to our online survey. Take a look at the stories and consider how you would have voted. With tsunamis, hurricanes and the threat of a flu pandemic, among other troubles, the year didn't lack for newsworthy events.
When I look back at 2005, one of the themes I detect is of an industry with money-management problems. It's not so much the lack of money, although that definitely is part of the equation for some sectors, but rather the overabundance of it and the craving for it. Hundreds of billions of dollars are deluging healthcare the way Katrina flooded the streets of New Orleans. Yet how all this spending benefits patients is unclear. Money often doesn't reach the places where it's needed the most.
The poster boy for healthcare money obsession in 2005 has to be Richard Scrushy. This man presided over one of the most corrupt enterprises in U.S. history. The government will probably have to build a special wing on a federal penitentiary to house all the HealthSouth chief financial officers and other executives sentenced in the fraud. Scrushy escaped conviction only because he and his spin doctors convinced the jury pool that Richard was just a good ol' Christian boy unaware of what his agents were doing. The acquittal says a lot about American gullibility, but that's another subject. True to form, though, Scrushy got indicted again in 2005 on charges of bribing a former Alabama governor for a state certificate-of-need panel post.
Meanwhile, the not-for-profit sector didn't emerge crowned in glory, either. The legal pressure continued on hospitals accused of beating up financially on the poor and uninsured while sitting on millions accumulated under the protection of tax-exempt status. Congress continued to ask questions about that and the lavish compensation to some top hospital executives. A coalition of not-for-profit experts presented Congress with 120 proposals for improving accountability and transparency. It suggested suspending tax exemptions in the worst cases and holding governing boards accountable for unreasonable CEO pay.
Then there were the insurers who made deals aimed at going from gargantuan to galactic. While billions of dollars move across the table to do these deals and executives pick up bonuses measured in millions of dollars, nothing much changes on the uninsured front. The companies racked up record profits while the uninsured numbers remained flat, and the Census Bureau reported that many were losing job-based coverage. Unionized workers at General Motors didn't lose their insurance, but they agreed to a contract scaling back benefits.
The pay-for-performance movement was a hot topic among readers. We should applaud any scheme that succeeds in improving healthcare quality. But it carries a few ironies. Giving someone more money to do what professional standards say he or she should have done all along strikes me as a little funny. Also, it bears some similarity to contingency fees, in which attorneys are rewarded for successful litigation. This probably is a bad comparison because providers would tell you lawyers are motivated by money, not justice, whereas physicians are motivated by dedication to the patient, not money.
There is plenty of money in healthcare, with more to come. The question is what does the industry do with it? Does it buy more toys for executives and well-heeled providers, or does it improve the health of patients, including those who aren't so privileged? Let's hope that in 2006, those with power choose the latter option.
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