Surgery Center of Oklahoma Blog

Like Dr. Ron Paul and everyone paying the 3% tax on their income for Medicare, I would like to see Medicare abolished.  This cannot be accomplished suddenly, however, as so many people are accustomed to living on the dole and the market would need time to react to this radical change.  I have suggested in a previous blog that one way to get there would be to send this Ponzi scheme to the states for them to deal with as they see fit.  Some in D.C. have suggested that the program continue, but be “means tested.”

I thought of this while at a college football game this weekend.  Having donated to a major university, my family was eligible to purchase seats in the “club level.”  This donation was significant.  I was struck at our first game with how many elderly folks were in the “club level.”  I started wondering how many of them would flinch or gripe about means testing Medicare.  I started thinking that spared the expense of health insurance or health care, they were able to buy these very expensive tickets to the game.  I began to wonder if these elderly folks realized that their grandchildren were actually subsidizing their football habit.  I thought of the grief that Dr. Tom Coburn has been given for even suggesting that means-testing federal entitlements like Medicare should be considered.

Most families are paying $1000-1500/month for traditional health insurance.  Many are not aware that this is the actual expense, as their employer pays a substantial amount of this bill.  This comes right out of the employee’s paycheck, however, one way or another.  This amount of money is more than enough to pay for a donation sufficient to “join the club” at the big university and purchase tickets at the 50 yard line.

Major university football teams and diesel motor home makers are not the only beneficiaries of this distortion of the market made possible by the robbery of the young working folks for the benefit of the older retirees.  The list of beneficiaries of this mal-investment is too long for this blog.

There is no market based insurance product for the elderly.  Medicare has no competitors.  Right now the elderly have no choice but to accept this program, other than to reject all insurance, an option that is scary for all but the extremely wealthy.  I hope the day will come when the elderly demand that this Ponzi scheme stops.  Medicare’s demise won’t  happen any other way, in spite of the efforts of well-meaning folks in D.C.

G. Keith Smith, M.D.

First a geography lesson.  Guthrie, Oklahoma is a quaint little town north of Edmond, Oklahoma.  Edmond is a northern suburb of Oklahoma City.  The initial flight from Oklahoma City was to Edmond.  The later flight for tax and school reasons has been to Guthrie.   Claremore is a suburb of Tulsa to the south (it is also the birthplace of Will Rogers).  Back to these little towns momentarily.

Imagine that two vampires are fighting it out for your blood.  I know.  It’s not Halloween yet but stay with me. This is not like two businesses competing for you because they want your business…competition that you will benefit from….this is for your blood.  You will be drained and worse off, no matter who gets to sink their teeth in to you.  Bottom line:  this is not about you, regardless what sales pitch The Count gives you about the benefits.  That pretty accurately describes the fight between two hospitals for the health business originating from Guthrie, Oklahoma.  It also describes the struggle between two corporate health giants over the south part of Tulsa and nearby Claremore.  This is not the stuff the free market is made of.

Now put yourself in the shoes of the Sisters of Mercy, for a moment.  Extremely profitable business from Guthrie has traditionally come to your hospital in Oklahoma City.  A competing hospital group builds a new facility in North Edmond (just south of Guthrie).  Ouch.  What do you do?  Well, if you have billions of dollars in the bank from years of “not making a profit,” you….ready?….buy Guthrie!  You buy their hospital. You buy their physician clinics.  You buy everything medical you can get your hands on.  You do this because your competitor has a history of setting up clinics and hiring the local doctors and basically draining the medical life out of a small town and hospital before moving on without remorse to the next victim.

The same thing is going on between two giants in Tulsa, with the town of Claremore acting as the host.  Hillcrest Hospital actually bought Southcrest Hospital and installed their one of their competitor’s henchman at the helm as the new administrator!

What do these purchases have in common?  They illustrate the buying power of these “not for profit” barracudas that have fleeced Oklahomans for years.  They illustrate how far these outfits will go to protect their turf.  They represent a “give away” of facilities that have been built or subsidized by taxpayers for years, even decades, to these giant hospital systems.  I wonder if any of the councilmen or county commissioners authorizing these sales will end up on the boards of these big hospitals?

I foresee that these small hospitals will only serve as a short and limited meal for  these blood suckers.  That has certainly been the pattern in Oklahoma.  A giant hospital opens a clinic in a small rural Oklahoma town and, “Presto!” all of the patients end up in Oklahoma City or Tulsa, decimating the previously solvent small town hospital.  Any patient that needs a surgery or procedure that makes money for the mother ship will be transferred to Oklahoma City or Tulsa.  Only the very sick and bed-ridden will be left in these small hospitals, having been essentially transformed into nursing homes.  It will soon be clear that having stripped away and devastated these now un-dead hospitals, they will not be able to continue to exist without the support of the giant corporation.  The big hospitals will then advertise this subsidization as a community service, never acknowledging that this devastation was their goal all along.  Ideally, for the Sisters of Mercy, Guthrie Hospital would close completely, leaving the referral fangs embedded in their community with “wellness” clinics and hired doctors.  Add the electronic medical record scam to this and the people of Guthrie will be more easily controlled and hearded to whatever destination suits the Mercy folks the best.  Same goes for Hillcrest.

Physicians in these smaller communities will experience the “Mercy Mission” first hand.  A local pediatrician actually said she was looking forward to this!  The local doctors will be told that “now that Mercy owns their clinic, that Mercy is the new landlord and here are your new rental rates”…they will be very high, or, Mercy won’t lease space to them at all if they don’t succumb to the “job offer.” ” And, by the way, you can either come to work for Mercy as an employee or we will make sure that all of these referrals for gall bladder or ear surgery go to Oklahoma City.  Oh, one more thing, we aren’t going to pay you enough to make ends meet so you might as well close your practice…we are going to send all of the business that makes us boatloads of money back to the mother ship anyway.”

What does Guthrie’s medical community look like 5 years down the road?  If you said the same as Claremore’s you go to the head of the class!  Small town hospitals have a difficult enough time as it is with their demographic of elderly and poor.  Add these opportunistic neck-biters to the picture and they don’t stand a chance.  Add their hostile physician practice takeovers and you have the answer to why small towns have trouble recruiting and keeping physicians.

G. Keith Smith, M.D.

“The needs of the many outweigh the needs of the few.”  If you are not a Star Trek fan you just need to know that this is what Mr. Spock said to his captain (Jim Kirk) when he volunteered for a suicide mission that would save the rest of the crew.  Back to this shortly.

Years ago I was pressured to release the confidential medical records of patients operated on at our facility.  I didn’t release the records and it got very ugly, but ultimately we prevailed.  During the very threatening discussions a physician who was a hired gun by the folks who wanted these records told me that patient confidentiality was not important if this data collection made a difference in someone else’s life.  I argued that individual rights distinguished our form of government from those that championed the “collective.”  I tried to point out that a possible benefit to one individual doesn’t justify the violation of the rights of another.

He quoted Mr. Spock, as I have above.  I pointed out that Mr. Spock’s actions were those of a volunteer.  ”It is one thing to throw yourself on a grenade to save your foxhole buddies.  It is quite another to be shoved onto the grenade against your will,” I said.  This hired gun still didn’t get it.  We wound up filing a lawsuit against this bunch of fascists and the patients’ data remained secure.

What’s the point of all of this? 

Everyone wants your health information.  Your employer wants it.  The government wants it at the state and federal level.  Private companies are offering chips onto which your health history, allergies and medications can be stored so that you can basically carry a detailed medical record with you at all times. 

My advice is to be very careful who you share your personal health history with.  It is not out of the realm of possibility that governments would subpoena data you have revealed to a private entity.  The consitution-ignoring thugs in D.C. have already done this with cell phone records.  Once your health information becomes digitalized, it is not nearly as secure as it was on a paper record.  Paper medical records are much more difficult to steal and organize into the much desired statistical justification for anything and everything that will be a recommendation from D.C.  It is probably no coincidence that the feds are providing incentives to physicians and faciltiies to convert to digital medical record systems.  Physicians and facilities that do not convert will be singled out for lower payments from Medicare, for instance.  Health information technology businesses have made billions because of these boosts in demand created by our wonderful government that simply were not there before.  Watch for certain congressmen and senators to have high paying positions on the boards of these companies after they leave office. 

Make no mistake.  The individual’s right to privacy with regard to their health records is under full assault and this attack will likely continue for some time, particularly with the disaster of a national health plan looming.

G. Keith Smith, M.D.

You are a banker.  You loan money to people and charge them interest.  If they don’t pay you back you have collateral but still are probably going to lose money.  You figure out that it doesn’t matter anymore whether the borrowers can or will pay you back.  If they can’t pay you back the taxpayers will pay you back.  Are you now more likely to make risky loans?

You want to build a house on the beach on the coast of North Carolina.  No insurance company will cover you for your losses due to hurricanes.  The risk is simply too great.  You figure out that the taxpayers (FEMA) will compensate you for your losses should you sustain damage from a hurricane.  Are you now more likely to build a home at risk?

This socialization of risk is also referred to as moral hazard.  Basically a situation whereby your decisions affect other folks money.  The socialization of risk prevents individuals from responding rationally to actual danger or loss to their property or even their lives.  How many lives have been lost when hurricanes struck homes that would never have been built in the first place, had the individual had to assume all of this property risk himself?  How many bankruptcies or even suicides have happened because people were incentivized and hustled to take out loans they could never repay?

Socializing the risk of disease is a much greater problem.  Don’t we have the welfare medical machine (Medicare/Medicaid) to blame for people continuing to smoke?  Haven’t we “taught” folks that even if they don’t have anything they will receive the state of the art treatment for conditions that are a result of risky behavior?  How much more careful would people be if they knew that the cost of their actions and behavior with regard to their health was on their shoulders alone?  Might there be less reckless driving and venereal disease?  Might people take better care of themselves and eat less and exercise more?

Inevitably, the institutions that embrace this socialization of risk go belly up.  Banks, FEMA, Medicare/Medicaid.  The demand for freebies simply overwhelms the supply.  I suggest that we all get as healthy as we can as soon as we can so we have little or no reliance on the health care system that the thugs in D.C. will try to impose on us, as this socialization of risk will inevitably dictate the rationing of what little, crappy care is available.

G. Keith Smith, M.D.

This is one of my favorite socialist expressions.  Usually it takes the form of “..giving back to the community.”  What the collectivists really mean is “give it back.”  This would be more honest, as socialists believe “it” was never the worker’s/individual’s property/money to begin with.  Socialists believe that it is O.K. for individuals to possess property for short periods of time as long as we realize that this possession doesn’t imply ownership.  We, as individuals, are allowed to keep a portion of our earnings, only to encounter the do-gooder who demands that we should be “giving back.”  This demand is usually reserved for businesses and entrepreneurs that are creating jobs, and through their desire to earn a profit vitalize entire cities or even states.  Yet there is an attitude that they need to “give back” something to the community which, of course, wouldn’t even exist without the efforts of the entrepreneurs victimized by this socialist guilt hustle.

Adam Smith, the Scottish economist, made clear in his treatise, “An Inquiry Into the Cause and Nature of the Wealth of Nations,” that individuals acting in their self interest, engaging in unfettered and mutually beneficial exchange actually increase the wealth and standard of living for everyone in a community.  Businessmen and entrepreneurs that take risks and employ capital in search of a profit or return succeed only if they offer something that people want at an acceptable price.  This willingness to take the initial risk with their private property is the most generous gift a community can receive.  The notion that this same individual should somehow need to assuage the guilt of success by “giving back” is preposterous.

Most big hospitals overdo this “giving back.”  They drop a lot of dough advertising what big “give it backers” they are.  They bring in high-priced celebrities to give tear-jerking talks.  They sponsor all manner of civic and “wellness” efforts.  They buy sponsorships to almost everything.  They purchase loads of advertising from local media.  They build practice facilities for sports franchises.  And all of this while “not making a profit!”

People complain about the high cost of health care but can’t seem to connect the dots here.  Isn’t is obvious that while masquerading as “good corporate citizens,” even “public servants”, these giant hospitals in an attempt  to purchase this image of generosity have revealed the extent to which they have ripped off the community with their overcharging and cost-shifting schemes?  With their “not-for-profit cover,” they don’t even pay taxes!

Having said that, now to the point.  Which business provides more benefit to a community?  One like The Surgery Center of Oklahoma, established with privately risked funds that posts prices online (unlike any other health care business anywhere), or a business that brings in speakers and sponsors sports teams with the loot they’ve grabbed after charging 6-8 times what the Surgery Center of Oklahoma does, for the same service?  Maybe there is a feeling at the big hospitals that having taken so much from communities (much of it through back room deals that shut out competitors) they need to do a lot of “giving back.”

G. Keith Smith, M.D.

Remember Bastiat’s concept of “what is not seen?”  When something gets broken or destroyed, some in the community see this as a stimulus for the economy putting people to work fixing the damage.  Bastiat rightly pointed out that all of this effort and money and time only serves to get back to where you started.  No improvement.  No net gain.  He pointed out that “what was not seen” was what might have been done to improve the overall lot with the money that was spent, had the damage not been done in the first place.  Otherwise burning down an entire city would make sense…just think of the jobs that would create rebuilding it!!  Obviously this is insanity.

Now,   check out this article.  Basically, St. Louis based Sisters of Mercy plans to spend 192 million dollars in Ft. Smith on a hospital.  They plan to spend about 400 million in Arkansas alone.  In a four state area they plan to spend 4.8 billion. Billion! What?  Where did this money come from?  I’ll tell you where it came from.  It is the unholy spawn of the $40 box of Kleenex and $100 aspirin at their hospitals.  I thought they were not-for-profit.  Consider that this outfit has worked extremely hard to destroy the private practice of physicians everywhere they go by aggressive and hostile purchases of private physician practices, most of the time accompanied by legitimate threats of “cutting the doctor out of their network.”   Consider that this outfit has worked hard to insure that they had no competition through political and other means.  Consider that they have arranged reimbursement rates from insurers that are 4 to 6 times that of nearby surgery centers and specialty hospitals they have worked hard to crush with behind the scenes tactics.  Consider that had this outfit been subject to normal competition that every other business must endure, this extraction of billions out of the communities they purportedly serve would never have happened in the first place.

Back to Bastiat.  Someone in the Ft. Smith area must be thinking, “wow…I sure am glad that this hospital system is investing all of this money in health care here.”  ”Look at all of these wonderful buildings!”  ”Look how great all of this investment is for the community!”

I am thinking that this is like a successful bank robber stopping off at a convenience store on the way out of town to buy a coke and some smokes with the loot he has stolen, all the while proclaiming that his purchase was good for the economy.  What might have been done with all of the money paid to this outfit had folks not been fleeced in the first place with this overpriced care?

The billions that these not-for-profit (don’t pay tax) hospitals have acquired over the years, have come from charging exorbitant rates and breaking the backs of hardworking people every day.  When cheaper and better care raised its head, these Mercy-less goons have worked every angle to hamstring competitors, insuring that their racket could continue.  I hope the people in Ft. Smith and other areas where this outfit operates will remember all of the marble and mahogany in these palaces when they see their hospital bill.

Don’t get me wrong.  We need hospitals.  We need for them to be profitable.  For all the community service they claim to do though, they would do a better service to cease extracting billions from the sick.  When the Sisters of Mercy has a bankroll like this it should surprise no one why health care is so expensive in the U.S.:  it has to be in order to support these Mercy-naries.

G. Keith Smith, M.D.

Why does Oklahoma need a health insurance exchange?  Because the feds say so?  I keep reading that our state government officials want no part of a federally designed health insurance exchange, but plan to do one at the state level.  I must be missing something.  This is like a pouting child telling his parent that he is going to take his medicine because he wants to, not because the parent has demanded it.  The result is the same.

Is this the best Oklahoma can do?  Are our state leaders afraid to be more bold with Uncle Sam?  How about,”we not only refuse your money to set up this exchange, but we refuse to set one up.”  ”Go ahead and try to impose one and see what happens.”

The federal government is out of control, led by a pharaoh-like executive.  I think it is time for the states to really push back against these bullies….not just by  joining other states in lawsuits to declare this health care plan unconstitutional (although this is probably warranted).  What is plan B?  What do our state leaders plan to do when the federal courts declare that this federal law has to be obeyed (seriously…they work for the federal government)?  Check out this great article by Walter Williams on whether laws should be obeyed.

The time to lead, not follow, has arrived.  Are our state leaders up to the task?  We’ll see.

G. Keith Smith, M.D.

Public schools’ standardized test data and scores are deleted/changed for no apparent reason.  Schools that were targeted by this data and subsequently punished in some way are now off the hook.  Algebra scores were completely deleted or not included in the report.

New parking meters destined to adorn the streets of downtown Oklahoma City are found out to be notoriously unreliable.  The biggest problem with them is that they exhibit “expired” before they are supposed to.

Does anyone smell a rat?  Could money have changed hands in either of the above situations?  Of course it could have.  What?  You don’t think that someone in local government would do this?

A scooter company faces fraud charges for not delivering scooters that the government paid for or for delivering lesser/cheaper models than those that were paid for.

What is the common denominator?  Government.  Government contracts and deals whether at the federal or the local level are unavoidably political deals.  Government contracts and deals don’t just allow for the institutionalization of fraud and corruption….it is inevitable.

Free markets are the only solution to the defrauding of the consumer.  Are there charlatans in the free market selling snake oil?  Absolutely.  They defraud one individual at a time and these lessons are usually learned the hard way…one individual at a time.  Government corruption occurs on a mass scale, however.  People that have the power to award contracts to meter makers or testing centers can easily profit from back room off-the-books deals and many times do, with multitudes affected by the scam, not individuals.  Word of mouth ruins the reputation of the charlatan after having harmed a few individuals.  Recipients of government contracts can harm thousands after having made off with the millions.  The government official receiving the bribe usually gets away with their heist and wastes no time designing their next conquest.

Is their fraud and abuse in medicine?  Absolutely!  My point is that free markets minimize this activity.  It is the very presence of government involvement in medicine that allows for the wide-scale fraud and corruption to occur.  Do we want more government involvement in the practice of medicine?

G. Keith Smith, M.D.

The Oklahoma State Chamber of Commerce is reconsidering their long policy of supporting the local cartel of liquor wholesalers here in the state.  This group has been incredibly successful in keeping the sale of wine and “high point” beer and spirits from being sold in grocery stores.  A friend of mine who is involved with a large chain of grocery stores in Ohio (he doesn’t do business in Oklahoma because of the prohibition on grocery store liquor sales) has told me that the sale of the wine/liquor in grocery stores is what provides them with the necessary margin to provide more goods and choices in other parts of the store.

As the facts become clear, there is simply no reason to limit these sales to liquor retailers.  Everyone of the scare tactics raised by those who have benefited from this cartelization of liquor sales have been debunked, one by one.  Now our State Chamber has decided that an end to the cartel makes sense.  Why?  To bring Costco and more Whole Food like grocers to the state…to create jobs.  Ending this arrangement will be devastating for the liquor retailers.  Repealing the laws in Oklahoma which are a throwback to prohibition days will drastically reduce the profits of the modern-day bootleggers, the liquor wholesalers.  Ending this cartel will benefit the consumer, not the producer/distributor.

This type of thinking is a dangerous and slippery slope for the folks in the Chamber.  Business and tax policy with the consumer in mind?  Repealing laws that basically provide protection for certain businesses?  This change in thinking could have serious consequences.

Ending the cartels in health care would result in gigantic savings for local companies if they are offering health care as a benefit of employment.  What would Texas do if Oklahoma led the way with innovative health care cartel -busting policy.  What if many of the legal obstacles put up by the insurance commission and insurance-led legislation were to be repealed, opening the way for the consumers of health care, not the providers of the care  (and certainly not the middle men selling the PPO snake oil) to drive the market in the direction it needs to go?

As a physician, I am called and paid to serve patients.  As the medical director of our large surgery center I am called and paid to serve the patients that come to our facility and to provide unparalleled service to the surgeons that work here.  Any laws that “protect” me or my facility from competitors only serve to increase the likelihood that the patients receive care of lessor quality than if I am exposed to competition from other facilities.  Cartels and monopolies exist only because the government at all levels embraces protectionism and writes these laws for a price.

I applaud the Chamber for their efforts to remove the liquor cartel from Oklahoma.  I hope that this economic 180 will extend to other businesses in the community that profit from their “protection” at the expense of those they are supposed to serve.

G. Keith Smith, M.D.

I got to see Tom Coburn in action at yesterday’s Town Hall meeting at Oklahoma City Community College.  One of his “questioners” was a recently retired air force officer who displayed a sense of entitlement that I haven’t seen since I was a resident working in the obstetrics unit at an indigent hospital.  Dr. Coburn was straightforward with him.  Then he was firm.  Then he made an example of him.  This was all very interesting to watch as Dr. Coburn is very articulate and listens well, but also hears what you mean when you speak not just what you say. 

What he heard from this man was, “someone other than me should pay for the health care needs of my whole family and myself for the rest of our lives.”  What Dr. Coburn told him was that the country is bankrupt and the military like everyone else is going to have to give up some of their goodies or our country and children and grandchildren are doomed.  This guy didn’t care.  First he disputed Dr. Coburn’s facts.  This was amusing as the cuts that were being disputed were devised by….Dr. Coburn…the retired soldier (looked like he was about 40 years old) was out of his league.   Second, he played the patriotism card.  Big mistake.  Coburn took him apart.

Here is what I found most interesting, though.  This man was expressing an extreme feeling of entitlement.  What was it he didn’t want to give up?  He pays $250/year for his family’s care.  That’s it.  Dr. Coburn’s plan would have him pay $750/year.  Do you know what that buys for him?  A government policy that pays so poorly that no one in the private practice of medicine will see him.  Worse than Medicare.  Seriously.  That’s what this guy was so adamant about.  That’s like fighting someone to the death over a 1972 Ford Pinto. 

Ignorant.  Entitled.  Arrogant.  Military retirees are writing letters to the editor of our local newspaper consistent with this idiot’s thinking. 

Dr. Coburn has his work cut out for him.

G. Keith Smith, M.D.