There are only two elections with national implications in 2013 and one of them isn't very exciting: the gubernatorial contest in New Jersey in which Gov. Chris Christie (R-NJ) will defeat state senator Barbara Buono (D) by a wide margin. The other one, in contrast, has strong implications for 2014 and 2016. Yesterday, at a state convention, Virginia Republicans nominated an extreme conservative, Ken Cuccinelli, as their candidate for governor. Equally conservative candiates were nominated for lieutenant governor (a black minister, E.W. Jackson) and Attorney General (state senator Mark Obenshain). The Democratic nominee is Terry McAuliffe, a long-time Democratic fundraiser, who is about as apolitical as a candidate for elected office can be. He's kind of the mirror image of Karl Rove--he fights very hard to make sure his horse wins the race, but doesn't care so much what the candidate does after he wins. If McAuliffe wins--and current polls mostly put him ahead--he'll have to make choices, of course, but he probably hasn't gotten that far yet.Click here for full story
I'm going to do some writing about discrete probability theory. Probability is an extremely important area of math. We encounter aspects of it every day. It's also a very poorly understood area - it's one that we see abused or just fouled up every day.
I'm going to focus on discrete probability theory. What that means is that we're going to look at things where the space containing the things that we're going to look at contains a countable number of elements. The probability of getting a certain sequence of coin flips, or of getting a certain hand of cards are described by discrete probability theory. On the other hand, the odds of a radioactive isotope decaying at a particular time requires continuous probability theory.
Before getting into the details, there's one important thing to mention. When you're talking about probability, there are two fundamental schools of interpretetation. There are frequentist interpretations, and there are Bayesian interpretations.
In a frequentist interpretation, when you say the probability of an event is 0.6, what you mean is that if you were to perform a series of experiments precisely reproducing the event, then on average, if you did 100 experiments, the event would occur 60 times. In the frequentist interpretation, the probability is an intrinsic property of the event. For a frequentist, it makes sense to say that there is a "real" probability associated with an event.
In a Bayesian interpretation, when you say that the probability of an event is 0.6, what you mean is that based on your current state of knowledge about the event, you have a 60% certainty that the event will occur. In a strict Bayesian interpretation, the event doesn't have any kind of intrinsic probability associated with it. The specific event that you're interested in either will occur, or it won't. There's no real probability involved. What probability measures is how certain you are about whether or not it will occur.
For example, think about flipping a fair coin.
A frequentist would say that you can flip a coin many times, and half of the time, it will land on heads. So the probability of a coin flip landing on the head of the coin is 0.5. A Bayesian would say that the coin will land either on heads or on tails. Since you don't know which, and you have no other information to use to be able to make a better prediction, you can have a certainty of 0.5 that it will land on the head of the coin.
In the real world, I think that most people are really somewhere in between.
I think that all but the most fervent Bayesians do rely on an intuitive notion of the "intrinsic" probability of an event. They may describe it in different terms, but when it comes down to it, they're using the basic frequentist notion. And I don't think that you can find a sane frequentist anywhere who won't use Bayes theorem to update their priors in the face of new information - which is the most fundamental notion in the Bayesian interpretation.
One note before I finish this, and get started on the real meaty posts. In the past, when I've talked about probability, people have started stupid flamewars in the comments. People get downright religious about interpretations of probability. There are religious Bayesians, who think that all frequentists are stupid idiots who should be banished from the field of math; likewise, there are religious frequentists who think that Bayesians are all a crop of arrogant know-it-alls who should be sent to Siberia. I am not going to tolerate any of that nonsense. If you feel that you cannot read posts on probability without going into a diatribe about those stupid frequentists/Bayesians and their deliberately stupid ideas, please go away and don't even read these posts. If you do go into such a diatribe, I will delete your comments without any hesitation.
In the wake of the dramatic events surrounding the discovery of three women including Amanda Berry, being held captive for a decade by a monster, it’s important not to forget another sociopath played a role in this drama. That sociopath is the psychic who told Amanda Berry’s mother that her daughter was dead:
Her mother, Louwana Miller, never gave up hope that the girl known as Mandy was still alive, according to the Cleveland Plain Dealer. The case attracted national attention when Miller went on Montel Williams’s nationally syndicated television show in 2004 and consulted a psychic.
“She’s not alive, honey,” the psychic said. “Your daughter’s not the kind who wouldn’t call.”
After Berry’s mother died in 2006, there were occasional clues in the search for Berry, and police have conducted a number of searches over the years. All proved fruitless — until Monday night, when Berry, Gina DeJesus and Michelle Knight were rescued from the house in Cleveland.
As Ben Goldacre reminds us, that psychic was Sylvia Brown, speaking out of her ass, surely “just for entertainment purposes” when she told Louwana Miller her daughter was dead. As the Wiki shows, her predictions aren’t reliable, and not surprisingly, she has a history of criminal behavior, including indictments and convictions for fraud and grand theft.
Psychics are by definition frauds. They don’t have magic powers. No human has the ability to read minds or see into the future. If you then take money under such known false pretenses that is the definition of fraud. If they truly do think they have magic powers, they should submit themselves to James Randi’s 1 million dollar paranormal challenge to determine if they can perform in a blinded, controlled test (which none of these frauds has ever come close to passing). Not surprisingly, Sylvia Brown has refused, many times, to take this challenge. This is because psychics know they’re frauds. Worse, Brown has even been previously convicted of fraud but sadly not for giving psychic readings. As a criminal, I guess she smartened up since 1992, the question is, why don’t we treat all psychics as criminals all the time? The burden of proof should be on them to prove they have this exceptional ability under controlled circumstances. Until then, we should simply arrest people that take money from others on the basis of such lies.
And the best article on the implications of this, surprisingly, comes from Huffington post authors Young and Kirkham:
The database released on Wednesday by the federal Centers for Medicare and Medicaid Services lays out for the first time and in voluminous detail how much the vast majority of American hospitals charge for the 100 most common inpatient procedures billed to Medicare. The database — which covers claims filed within fiscal year 2011 — spans 163,065 individual charges recorded at 3,337 hospitals located in 306 metropolitan areas.
Within the nation’s largest metropolitan area, the New York City area, a joint replacement runs anywhere between $15,000 and $155,000. At two hospitals in the Los Angeles area, the cost of the same treatment for pneumonia varies by $100,000, according to the database.
We discussed this issue before when it was brought to the public’s attention by Brill’s “Bitter Pill” piece in Time. Hospitals have a wildly-irrational billing scheme that represents a war they are in with payers. However, Brill was wrong to attribute excess costs of US healthcare to the charge master problem, while the HuffPo piece gets this issue right. It’s not a problem for insurance companies, or government, since they don’t pay these bills. It only screws payers without negotiating power or knowledge of how to navigate these bills – the uninsured:
“The charge masters are totally irrational,” Robert Laszewski, a former health insurance company executive who consults for health care companies as president of Alexandria, Va.-based Health Policy and Strategy Associates, wrote in an email to The Huffington Post.
Hospitals used to base prices on health care costs and on the need for profit that would, among other things, enable them to make investments in their facilities, Laszewski explained. “They became the baseline from which the hospitals started,” he wrote. But over time, hospitals raised charges in anticipation of negotiating discounts with private health insurance companies while maintaining their revenue streams, he said.
Prices have continued growing over decades to the point where there is no plausible justification for them, according to Laszewski: “Over the years, the charge masters have become more and more disconnected from reality.”
And since they haven’t been public or shared before now, I suspect each hospital probably has some set of services that appear to be priced excessively compared to their near neighbor. The costs haven’t grown so much from a response to the treatments they provide, so much as the perceived ability to force insurers to pay a larger portion. Each hospital has probably independently evolved a strategy to do this, hence the wide variability in pricing.
The charges are the prices hospitals establish themselves for the services they provide. Although Medicare and Medicaid don’t base their payment rates on these figures, private health insurance companies typically do, which means they usually pay more for the same health care than the government does. That translates into higher premiums for people with insurance. And uninsured people are expected to pay the full list price or a discount from that number, which tends to mean they pay more than anyone else.
When a hospital doesn’t get paid as much as it wants from one source, it tries to make up the difference in other ways, such as billing so-called self-pay patients — almost always the uninsured — for the full list price of a service, said Robert Huckman, a health care expert at Harvard Business School. Even when hospitals agree to huge discounts for patients who can’t pay the bill, those discounts are taken from inflated prices much higher than those the government or private insurance companies pay, he said.
“The charge master is complete nonsense that really doesn’t matter — unless you are an uninsured person and you’re getting these huge bills driving you toward bankruptcy,” Laszewski wrote. “The biggest irony of the U.S. health care system is that only the uninsured — often people who don’t have a lot of money — are the only ones the hospital expects to pay these incredibly inflated list prices!”
Hospitals also inflate charges to raise money for things that aren’t related to treatments, said former Sen. David Durenberger (R-Minn.), who is senior health policy fellow at the University of St. Thomas in Minneapolis.
“The biggest factor by far, in my experience, is what are you trying to cross-subsidize,” he said. Hospitals will increase charges to finance things like technology upgrades and education and research and to compensate for their operational efficiencies, Durenberger said.
We’ve discussed extensively the sources of excess costs in US healthcare. It’s not the chargemaster. It’s excessive administrative costs of private health insurance, excessive drug costs (everything from direct-to-consumer advertising, the fact US citizens are charged more and GWB made it so medicare can’t negotiate for lower drug prices), inefficient delivery (primary care in the ER), redundant delivery, lack of a government-implemented or regulated standardized electronic medical record (EMRs from private companies actually increase costs), defensive medicine, excessive end-of-life care, and excessive reimbursements of procedures and diagnostic testing.
What will this data release mean for health care costs? Probably not much as the hospitals will now just normalize excessive bills to each other, rather than just having their own individually-irrational billing scheme. The charge master is unjust, but it’s not why we pay more for healthcare overall.
There is a solution to the charge master problem though, and it was found in New Jersey. Force hospitals to charge the uninsured what they charge Medicare. It’s that simple. It’s that easy.