After tasting success in domestic markets, it’s ‘Dial Africa’ for Indian telecommunication companies. And it’s not the high-profile, twice-rejected MTN alone that’s attracting Indian firms.
While the government-owned Mahanagar Telephone Nigam Ltd (MTNL) is in advanced discussions for telecom licences in four countries, Bharat Sanchar Nigam Ltd (BSNL) is formulating its strategy to enter the continent.
Adding their bit are the Essar group, Tata Communications and Reliance Communications, all of which have licences for telecom services in African countries and are looking to expand their operations.
Bharti Airtel is negotiating with South Africa-based MTN for a “two way deal” that would allow it to own 49 per cent equity in South African giant MTN.
“We are evaluating a proposal to acquire a company that has licences in four to five countries,” said R.S.P. Sinha, chairman and managing director (CMD), MTNL. “Africa is a lucrative market and we would like to acquire a licence through auction if there is an opportunity.” However, in most countries, licences have been auctioned.
“Funding is not an issue for our Africa expansions,” Sinha said. “We have done all the ground work.” MTNL is presently a service provider in partnership with Tata Communications (formerly VSNL) and Telecommunications Consultants India Ltd (TCIL). “We will enter into Africa on our own,” said Sinha.
MTNL not the only government-owned company eyeing the African market. “We are looking at an expansion in Africa,” said Kuldeep Goyal, CMD, BSNL. “Whenever we find right opportunity we will grab it.”
Essar group has acquired a telecom licence in Uganda. “Africa is an important market for Essar’s telecom business and we are working towards building a strong brand in this market,” said Srinivas iyengar, CEO, Essar Telecom Kenya. “We would be looking at opportunities to establish a pan Africa footprint in future.”
The company plans to offer services in a joint venture with a local company, Kenya Telecom Uganda Ltd. It already has a licence in Kenya and plans to expand in other countries.
“We find African markets promising and have recently hiked our stake in Neotel (of South Africa) to 56 per cent from 26 per cent,” a senior Tata Communications official said. “We view this as a beach head to the rest of the African markets as and when right opportunities arise.”
Why Africa?
“African countries have just started moving on the development path,” said RK Upadhyay, CMD, TCIL. The company has been executing telecom infrastructure projects in Africa for past 20 years and is present in 30 countries. “There is expected to be enormous growth in telecommunications in next five years. Whenever, development takes place in a developing economy, the need for telecom services increases,” Upadhyay said.
“Africa has a low teledensity and high average revenue per user,” said Goyal. This explains why Indian providers want to go to. India has a teledensity (number of telephones for a population of 100) of about 40 per cent. In many African countries the teledensity is below 20 per cent (See table).
Besides, the continent’s average revenue per user is high. Against Rs 250 per month in India, the number in some African countries including is about three times as much.
Reliance has a licence in Uganda for offering mobile, fixed line, Internet, national and international long distance services, in addition to WiMax and Wifi services. It plans to acquire licences in other countries, a senior official said.
Sunday, June 7, 2009
Justices’ panel wanted Punjab judge sacked
The Union government is not allowing the prosecution of a High Court judge suspected of receiving bribes — including whiskey bottles and a mobile phone — and fixing illegal land deals.
But it now emerges that an in-house inquiry committee constituted by the Chief Justice of India has recommended the removal of Justice Nirmal Yadav of the Punjab and Haryana High Court.
A rare, in-house probe by Allahabad High Court Chief Justice HL Gokhale, Gujarat High Court Chief Justice KS Radhakrishnan and Justice Madan B Lokur of the Delhi High Court has “established beyond doubt” that Justice Yadav received Rs 15 lakh in unexplained money, sent by Delhi hotelier Ravinder Singh, according to a thus-far secret 92-page report which is in possession of the Hindustan Times.
The committee gave its report on December 6, 2008. Hindustan Times reported two days ago how in March the Union government refused permission to prosecute Justice Yadav, citing insufficient evidence — and at a time when questions are being raised about the government’s reluctance to intervene and the judiciary’s reluctance to act against its own.
Contacted on Friday, Law Minister Veerappa Moily refused comment, disconnecting the phone. The SC inquiry and CBI inquiries were both initiated by Chief Justice of India (CJI) KG Balakrishnan. Both relied on the same evidence: interrogation of suspects and witnesses, documents and cellphone call details.
Last week this paper also reported how Punjab’s Vigilance Bureau had asked for — but not received permission — to further investigate into the revelations of an officially-sanctioned phone tapping of two private persons in which the names of two other judges of the Punjab and Haryana High Court had figured in connection with a slew of malpractices, including payment of bribes for favourable judgements.
“The misconducts (sic) disclosed against you are serious enough for initiation of proceedings for your removal as Judge of Punjab and Haryana High Court,” said a confidential note issued by CJI and served on Justice Yadav on December 25, 2008.
In response, Justice Yadav started a flurry of communications with the CJI, picking holes in the Committee findings. She raised a number of objections and argued that a SC judge and a Punjab and Haryana High Court judge were at the residence of another High Court judge, who shared a similar-sounding name, Nirmaljit Kaur, where the Rs 15 lakh was wrongly delivered on August 13, 2008.
Justice Yadav based her allegation on a reference in the inquiry committee report which inter-alia says, "...even if there were some judges present at the residence of Justice Nirmaljit Kaur on the evening of August 13, 2008, it has no bearing or relevance to the inquiry.”
Justice Yadav’s implication: the money was meant for these judges, not for her. Her arguments were not supported by the evidence, which point to payoffs from touts.
There has been no further action by the Chief Justice over six months. Justice Yadav was taken off the high court Bench last year, continues to be without judicial work and receives full salary and benefits. Justice Nirmal Yadav initially refused comment. Later, she said: “The matter is with the Chief Justice of India whom I have already submitted my replies.”
The three-judges committee had two tasks:
To determine if the Rs 15 lakh, delivered to the residence of Justice Kaur, was meant for Justice Nirmal Yadav and that it was sent by Delhi hotelier Ravinder Singh through Sanjiv Bansal, then Additional Advocate General of Haryana.
To determine if the Rs 15 lakh was paid by Singh to Justice Yadav on August 14 through Rajeev Gupta, Bansal’s friend.
"Both these allegations have been established beyond any reasonable doubt. These allegations themselves amount to acts unbecoming on the part of Justice Nirmal Yadav,” said the report.
Justice Yadav, the report said, “did not practice the degree of aloofness which was expected of her consistent with the dignity of her office”.
But it now emerges that an in-house inquiry committee constituted by the Chief Justice of India has recommended the removal of Justice Nirmal Yadav of the Punjab and Haryana High Court.
A rare, in-house probe by Allahabad High Court Chief Justice HL Gokhale, Gujarat High Court Chief Justice KS Radhakrishnan and Justice Madan B Lokur of the Delhi High Court has “established beyond doubt” that Justice Yadav received Rs 15 lakh in unexplained money, sent by Delhi hotelier Ravinder Singh, according to a thus-far secret 92-page report which is in possession of the Hindustan Times.
The committee gave its report on December 6, 2008. Hindustan Times reported two days ago how in March the Union government refused permission to prosecute Justice Yadav, citing insufficient evidence — and at a time when questions are being raised about the government’s reluctance to intervene and the judiciary’s reluctance to act against its own.
Contacted on Friday, Law Minister Veerappa Moily refused comment, disconnecting the phone. The SC inquiry and CBI inquiries were both initiated by Chief Justice of India (CJI) KG Balakrishnan. Both relied on the same evidence: interrogation of suspects and witnesses, documents and cellphone call details.
Last week this paper also reported how Punjab’s Vigilance Bureau had asked for — but not received permission — to further investigate into the revelations of an officially-sanctioned phone tapping of two private persons in which the names of two other judges of the Punjab and Haryana High Court had figured in connection with a slew of malpractices, including payment of bribes for favourable judgements.
“The misconducts (sic) disclosed against you are serious enough for initiation of proceedings for your removal as Judge of Punjab and Haryana High Court,” said a confidential note issued by CJI and served on Justice Yadav on December 25, 2008.
In response, Justice Yadav started a flurry of communications with the CJI, picking holes in the Committee findings. She raised a number of objections and argued that a SC judge and a Punjab and Haryana High Court judge were at the residence of another High Court judge, who shared a similar-sounding name, Nirmaljit Kaur, where the Rs 15 lakh was wrongly delivered on August 13, 2008.
Justice Yadav based her allegation on a reference in the inquiry committee report which inter-alia says, "...even if there were some judges present at the residence of Justice Nirmaljit Kaur on the evening of August 13, 2008, it has no bearing or relevance to the inquiry.”
Justice Yadav’s implication: the money was meant for these judges, not for her. Her arguments were not supported by the evidence, which point to payoffs from touts.
There has been no further action by the Chief Justice over six months. Justice Yadav was taken off the high court Bench last year, continues to be without judicial work and receives full salary and benefits. Justice Nirmal Yadav initially refused comment. Later, she said: “The matter is with the Chief Justice of India whom I have already submitted my replies.”
The three-judges committee had two tasks:
To determine if the Rs 15 lakh, delivered to the residence of Justice Kaur, was meant for Justice Nirmal Yadav and that it was sent by Delhi hotelier Ravinder Singh through Sanjiv Bansal, then Additional Advocate General of Haryana.
To determine if the Rs 15 lakh was paid by Singh to Justice Yadav on August 14 through Rajeev Gupta, Bansal’s friend.
"Both these allegations have been established beyond any reasonable doubt. These allegations themselves amount to acts unbecoming on the part of Justice Nirmal Yadav,” said the report.
Justice Yadav, the report said, “did not practice the degree of aloofness which was expected of her consistent with the dignity of her office”.
Health and climate change vie for boost in Congress
Barack Obama may be pressuring Congress as no U.S. president has for decades as he aims to get two big domestic goals passed this year -- reforming health care and fighting global warming.
"It's not impossible to do both, but that would be more than a Congress has ever given a president, maybe since the first First 100 Days," said Brookings Institution senior fellow Stephen Hess, referring to the start of Franklin Roosevelt's "New Deal" presidency in 1933.
A further time constraint may be the pressures imposed by the campaign next year for congressional elections in November when the seats of all 435 U.S. representatives and a third of the 100 senators are up for grabs.
Congress in the past often has shown itself to be unable to handle more than one big issue a year, but Obama and his fellow Democrats, who control the Senate and House of Representatives, see a window of opportunity this year to pass two long-standing Democratic goals.
Expanding health care to the uninsured and reducing pollution associated with climate change would have an economic impact on nearly every consumer and most U.S. companies -- from health insurers and utilities, to oil refineries, ailing automakers, steel manufacturers and small businesses.
Nonetheless, Democratic leaders are giving it a run, placing both initiatives on a fast track -- with or without much Republican support.
"The one that has the highest probability of making it is health care," said Bruce Josten, an executive vice president at the U.S. Chamber of Commerce. He noted a full legislative agenda later this year, including annual spending bills, a Supreme Court confirmation and tax legislation, could crowd out a climate bill debate in the Senate.
Nevertheless, several congressional committees are pushing ahead with their review of the bill that aims to cut industry's carbon dioxide emissions 17 percent by 2020 and 83 percent by 2050 with alternative energy sources and energy efficiencies.
The bill's prospects are strengthened by an unusual coalition of environmentalists, corporations and labor unions that have joined the effort. Obama is trying to sell climate change legislation as much more than doing something good for the environment. "Green" job creation and weaning the country off of foreign oil are his major talking points.
According to several Democratic lawmakers, the White House is already working hard to woo Senate Democratic and Republican moderates who will hold the keys to obtaining the needed 60-vote majority in the 100-member Senate.
In the meantime, environmentalists are heartened that four months into Obama's presidency such wide-ranging legislation is advancing, even with its concessions to some industries.
"If it became law today it would be the most important piece of energy and environmental legislation Congress ever produced," said one activist.
HEALTH CARE IN THE LEAD
Of the two, health care might be the bill that is more likely to reach Obama's desk for enactment by year's end. Both houses of Congress hope to blend their respective bills into a compromise measure by October -- Obama's deadline.
Democratic Senator Edward Kennedy has a major role in drafting the new health care bill as head of the Senate Health, Education, Labor and Pensions Committee. The bill would require individuals and businesses to purchase insurance and prohibit insurance companies from refusing to cover anyone because of health history.
Senate Democratic Leader Harry Reid said for the next five weeks, the Senate's normal three-day work week will be extended to five so a health care reform bill can be passed.
"I want to emphasize what the president said, that health care is an absolute priority," said Representative Chris Van Hollen, a member of the House Democratic leadership, when asked by Reuters about the two bills' prospects. "But we believe we're going to do both" in the House, he added.
In the midst of a deep economic recession and with medical bills contributing to an estimated 60 percent of U.S. personal bankruptcies, providing health care for those without insurance is paramount to Obama.
Fifteen years ago, then-President Bill Clinton tried to keep a campaign pledge to enact universal health care, only to fail miserably. That contributed to significant Democratic losses in the 1994 congressional elections.
Since then, the health care problem has worsened with medical costs escalating and 46 million uninsured. Democrats claim they've learned their lesson about unfulfilled promises.
They still have to find a sound way to pay for expanding health care, a tough job amid staggering U.S. budget deficits.
Republicans keep hammering away at any proposed government-run health insurance. "A government plan could undercut private health plans, forcing people off the health plans they like," Senate Minority Leader Mitch McConnell warned.
Behind the scenes, House Speaker Nancy Pelosi is pressuring her lieutenants to speed up work on the climate change legislation, which won strong backing last month from the politically diverse House Energy and Commerce Committee.
Pelosi hopes to pass this bill in June or July. Even if the legislation were to go no further this year, Obama would have a major accomplishment to tout in December, when world leaders are set to meet in Copenhagen to discuss global warming.
But the legislation likely would result in higher energy bills for American consumers, an especially difficult sell during a recession.
"It's not impossible to do both, but that would be more than a Congress has ever given a president, maybe since the first First 100 Days," said Brookings Institution senior fellow Stephen Hess, referring to the start of Franklin Roosevelt's "New Deal" presidency in 1933.
A further time constraint may be the pressures imposed by the campaign next year for congressional elections in November when the seats of all 435 U.S. representatives and a third of the 100 senators are up for grabs.
Congress in the past often has shown itself to be unable to handle more than one big issue a year, but Obama and his fellow Democrats, who control the Senate and House of Representatives, see a window of opportunity this year to pass two long-standing Democratic goals.
Expanding health care to the uninsured and reducing pollution associated with climate change would have an economic impact on nearly every consumer and most U.S. companies -- from health insurers and utilities, to oil refineries, ailing automakers, steel manufacturers and small businesses.
Nonetheless, Democratic leaders are giving it a run, placing both initiatives on a fast track -- with or without much Republican support.
"The one that has the highest probability of making it is health care," said Bruce Josten, an executive vice president at the U.S. Chamber of Commerce. He noted a full legislative agenda later this year, including annual spending bills, a Supreme Court confirmation and tax legislation, could crowd out a climate bill debate in the Senate.
Nevertheless, several congressional committees are pushing ahead with their review of the bill that aims to cut industry's carbon dioxide emissions 17 percent by 2020 and 83 percent by 2050 with alternative energy sources and energy efficiencies.
The bill's prospects are strengthened by an unusual coalition of environmentalists, corporations and labor unions that have joined the effort. Obama is trying to sell climate change legislation as much more than doing something good for the environment. "Green" job creation and weaning the country off of foreign oil are his major talking points.
According to several Democratic lawmakers, the White House is already working hard to woo Senate Democratic and Republican moderates who will hold the keys to obtaining the needed 60-vote majority in the 100-member Senate.
In the meantime, environmentalists are heartened that four months into Obama's presidency such wide-ranging legislation is advancing, even with its concessions to some industries.
"If it became law today it would be the most important piece of energy and environmental legislation Congress ever produced," said one activist.
HEALTH CARE IN THE LEAD
Of the two, health care might be the bill that is more likely to reach Obama's desk for enactment by year's end. Both houses of Congress hope to blend their respective bills into a compromise measure by October -- Obama's deadline.
Democratic Senator Edward Kennedy has a major role in drafting the new health care bill as head of the Senate Health, Education, Labor and Pensions Committee. The bill would require individuals and businesses to purchase insurance and prohibit insurance companies from refusing to cover anyone because of health history.
Senate Democratic Leader Harry Reid said for the next five weeks, the Senate's normal three-day work week will be extended to five so a health care reform bill can be passed.
"I want to emphasize what the president said, that health care is an absolute priority," said Representative Chris Van Hollen, a member of the House Democratic leadership, when asked by Reuters about the two bills' prospects. "But we believe we're going to do both" in the House, he added.
In the midst of a deep economic recession and with medical bills contributing to an estimated 60 percent of U.S. personal bankruptcies, providing health care for those without insurance is paramount to Obama.
Fifteen years ago, then-President Bill Clinton tried to keep a campaign pledge to enact universal health care, only to fail miserably. That contributed to significant Democratic losses in the 1994 congressional elections.
Since then, the health care problem has worsened with medical costs escalating and 46 million uninsured. Democrats claim they've learned their lesson about unfulfilled promises.
They still have to find a sound way to pay for expanding health care, a tough job amid staggering U.S. budget deficits.
Republicans keep hammering away at any proposed government-run health insurance. "A government plan could undercut private health plans, forcing people off the health plans they like," Senate Minority Leader Mitch McConnell warned.
Behind the scenes, House Speaker Nancy Pelosi is pressuring her lieutenants to speed up work on the climate change legislation, which won strong backing last month from the politically diverse House Energy and Commerce Committee.
Pelosi hopes to pass this bill in June or July. Even if the legislation were to go no further this year, Obama would have a major accomplishment to tout in December, when world leaders are set to meet in Copenhagen to discuss global warming.
But the legislation likely would result in higher energy bills for American consumers, an especially difficult sell during a recession.
China influence to grow faster than most expect: Soros
Financier George Soros said on Sunday that China's global influence is set to grow faster than most people expect, with its isolation from the global financial system and a heavy state role in banking aiding a relatively swift economic recovery.
He reiterated his cautious views regarding the surge in global stock markets, although he said it may have further to go given liquidity in the markets and that many investors are still sitting on the sidelines.
"In many ways, Chinese banking has benefited from being isolated from the rest of the world and is in better shape than the international banking system," he told an audience at Shanghai's Fudan University.
China's extensive capital controls have helped to shield its financial institutions from the worst of the global financial crisis.
"The influence of the state is also greater. So when the government says 'lend', banks lend," Soros added. "This puts China in a better position to recover from the recession and that is in fact what has happened."
New loans by Chinese banks surged to record levels in the first quarter, spurring optimism over recovery prospects for the world's third-largest economy.
POSITIVE FORCE
"China is going to be a positive force in the world and the market, and as a consequence, its power and influence are likely to grow. Personally, I believe it's going to grow faster than most people currently expect," Soros said.
He acknowledged that some doubts remain over China's economic recovery, however, noting data such as a continued fall in electricity consumption.
He also noted that China's aggressive 4 trillion yuan ($586 billion) economic stimulus program, announced last year, had bolstered the economy.
"If that program proves inadequate, it is in a position to apply additional stimulus. China is also in a position to foster a revival of its exports by extending credit and investing abroad," he said.
He reiterated his view that because China's economy is only one-quarter the size of the U.S. economy, it cannot replace the American consumer as the motor of the global economy, so global growth will be slower than in the past.
He sounded a more upbeat note for China's asset markets than for global markets overall, where he remained wary.
"I'm pretty cautious. Even though I've said prices are cheap, I'm not so optimistic as to put all my money into stocks or assets because I think that the outlook is fairly uncertain.
"I do, however, think that the Chinese economy is a promising economy. I think here it is more a matter of finding the right assets rather than saying that I'm not interested in investing." Asked if the recent climb in global stock markets was a bear market rally, he said: "It may have further to go because there is a lot of liquidity, a lot of investors are on the sidelines. If the market keeps on going up, more of them may decide to join in. You never know how far the rally goes."
"But I certainly don't think we are at the beginning of a big bull market worldwide
He reiterated his cautious views regarding the surge in global stock markets, although he said it may have further to go given liquidity in the markets and that many investors are still sitting on the sidelines.
"In many ways, Chinese banking has benefited from being isolated from the rest of the world and is in better shape than the international banking system," he told an audience at Shanghai's Fudan University.
China's extensive capital controls have helped to shield its financial institutions from the worst of the global financial crisis.
"The influence of the state is also greater. So when the government says 'lend', banks lend," Soros added. "This puts China in a better position to recover from the recession and that is in fact what has happened."
New loans by Chinese banks surged to record levels in the first quarter, spurring optimism over recovery prospects for the world's third-largest economy.
POSITIVE FORCE
"China is going to be a positive force in the world and the market, and as a consequence, its power and influence are likely to grow. Personally, I believe it's going to grow faster than most people currently expect," Soros said.
He acknowledged that some doubts remain over China's economic recovery, however, noting data such as a continued fall in electricity consumption.
He also noted that China's aggressive 4 trillion yuan ($586 billion) economic stimulus program, announced last year, had bolstered the economy.
"If that program proves inadequate, it is in a position to apply additional stimulus. China is also in a position to foster a revival of its exports by extending credit and investing abroad," he said.
He reiterated his view that because China's economy is only one-quarter the size of the U.S. economy, it cannot replace the American consumer as the motor of the global economy, so global growth will be slower than in the past.
He sounded a more upbeat note for China's asset markets than for global markets overall, where he remained wary.
"I'm pretty cautious. Even though I've said prices are cheap, I'm not so optimistic as to put all my money into stocks or assets because I think that the outlook is fairly uncertain.
"I do, however, think that the Chinese economy is a promising economy. I think here it is more a matter of finding the right assets rather than saying that I'm not interested in investing." Asked if the recent climb in global stock markets was a bear market rally, he said: "It may have further to go because there is a lot of liquidity, a lot of investors are on the sidelines. If the market keeps on going up, more of them may decide to join in. You never know how far the rally goes."
"But I certainly don't think we are at the beginning of a big bull market worldwide
Big oil watches Iran vote, but investment distant
Iran's presidential election on June 12 may mark a small step toward the return of big oil's cash to the country's energy sector, but it could be years before investment flows freely.
Iran sits on the world's second-largest oil and gas reserves, a mouth-watering prospect for international firms starved of access to Middle East fields. But Tehran has not signed a major deal with a large western oil company for years as political pressure over its nuclear program kept them out.
"If you are an energy company, Iran is too big to ignore," energy consultant Mehdi Varzi said. "You want to get involved. But if your government says no, you simply can't."
U.S. President Barack Obama has said he wants a new relationship with Iran, raising the prospect that U.S. oil firms long banned from working in the country may make a comeback.
"Like many people I am very optimistic and hopeful that we have a possibility of something being resolved there," said Jonathan Whitehead, head of commodity sales and structuring for Barclays Capital in Europe, the Middle East and Africa.
"When that happens, how it happens and whether it opens the door for some of these big hydrocarbon-based projects I'm just not really sure."
There is no guarantee the election would result in progress on the nuclear dispute and to sanctions easing, both required by big oil.
Whether the winner is anti-American incumbent Mahmoud Ahmadinejad or his more moderate key rival, former Prime Minister Mirhossein Mousavi, Iran's nuclear policy is controlled by its supreme leader, Ayatollah Ali Khamenei.
"I can't foresee billions of dollars of investment in Iran from Western companies anytime soon... sanctions removal won't happen overnight, regardless of who is elected president," said Julia Nanay, analyst at consultancy PFC Energy.
"And relations could still get more tense and additional pressure could be applied if there is no progress on nuclear discussions."
The United States has accused Iran of seeking to develop a nuclear weapon, while Tehran says it needs nuclear electricity.
HOLDING GAME
Energy firms have for years played a tricky holding game in Iran, aiming to look keen and yet keep the distance required by home governments.
It hasn't always worked. Iran on Wednesday replaced France's Total (TOTF.PA), which had delayed committing to a multi-billion dollar gas deal, with China's state firm the China National Petroleum Corporation on Wednesday [ID:nDAH335106]
In 2006, Iran stripped Japan's INPEX of most of its 75 percent stake in the Azadegan oilfield for moving too slowly on drilling.
Among the companies waiting for conditions to improve are Royal Dutch Shell (RDSa.L) and Spain's Repsol (REP.MC), which like Total put plans to invest billions in Iran's giant South Pars gas field on hold last year.
Austria's OMV (OMVV.VI) and Norway's StatoilHydro (STL.OL) have oilfield investment schemes on hold.
Sanctions have slowed OPEC-member Iran's oil and gas development and the U.S. also put pressure on banks to make financing difficult.
"It has slowed progress and made it more costly for them...," said Al Troner, managing director of Asia Pacific Energy Consulting. "It makes (Iran) go to partners who don't have the expertise needed to execute some of their projects."
Asian companies have stepped into the vacuum left by Western counterparts. But they lack the technology to develop gas export facilities and some of Iran's trickier fields.
Even state-owned Asian energy companies hungry to secure future energy needs and less concerned about Western political opprobrium have been slow to invest, analysts said.
If the U.S. eased the back-room pressure on banks to steer clear of financing energy projects in Iran, that could help the trickle of cash into the energy sector, said Fereidun Fesharaki, head of FACTS Global Energy, which advises companies on refining and marketing strategies.
"It's going to be a small breather," Fesharaki said. "We will go back to where we were two years ago. So the National Iranian Oil Company can borrow money and their projects can bring some capital in, but there won't be a big turnaround."
Iran sits on the world's second-largest oil and gas reserves, a mouth-watering prospect for international firms starved of access to Middle East fields. But Tehran has not signed a major deal with a large western oil company for years as political pressure over its nuclear program kept them out.
"If you are an energy company, Iran is too big to ignore," energy consultant Mehdi Varzi said. "You want to get involved. But if your government says no, you simply can't."
U.S. President Barack Obama has said he wants a new relationship with Iran, raising the prospect that U.S. oil firms long banned from working in the country may make a comeback.
"Like many people I am very optimistic and hopeful that we have a possibility of something being resolved there," said Jonathan Whitehead, head of commodity sales and structuring for Barclays Capital in Europe, the Middle East and Africa.
"When that happens, how it happens and whether it opens the door for some of these big hydrocarbon-based projects I'm just not really sure."
There is no guarantee the election would result in progress on the nuclear dispute and to sanctions easing, both required by big oil.
Whether the winner is anti-American incumbent Mahmoud Ahmadinejad or his more moderate key rival, former Prime Minister Mirhossein Mousavi, Iran's nuclear policy is controlled by its supreme leader, Ayatollah Ali Khamenei.
"I can't foresee billions of dollars of investment in Iran from Western companies anytime soon... sanctions removal won't happen overnight, regardless of who is elected president," said Julia Nanay, analyst at consultancy PFC Energy.
"And relations could still get more tense and additional pressure could be applied if there is no progress on nuclear discussions."
The United States has accused Iran of seeking to develop a nuclear weapon, while Tehran says it needs nuclear electricity.
HOLDING GAME
Energy firms have for years played a tricky holding game in Iran, aiming to look keen and yet keep the distance required by home governments.
It hasn't always worked. Iran on Wednesday replaced France's Total (TOTF.PA), which had delayed committing to a multi-billion dollar gas deal, with China's state firm the China National Petroleum Corporation on Wednesday [ID:nDAH335106]
In 2006, Iran stripped Japan's INPEX of most of its 75 percent stake in the Azadegan oilfield for moving too slowly on drilling.
Among the companies waiting for conditions to improve are Royal Dutch Shell (RDSa.L) and Spain's Repsol (REP.MC), which like Total put plans to invest billions in Iran's giant South Pars gas field on hold last year.
Austria's OMV (OMVV.VI) and Norway's StatoilHydro (STL.OL) have oilfield investment schemes on hold.
Sanctions have slowed OPEC-member Iran's oil and gas development and the U.S. also put pressure on banks to make financing difficult.
"It has slowed progress and made it more costly for them...," said Al Troner, managing director of Asia Pacific Energy Consulting. "It makes (Iran) go to partners who don't have the expertise needed to execute some of their projects."
Asian companies have stepped into the vacuum left by Western counterparts. But they lack the technology to develop gas export facilities and some of Iran's trickier fields.
Even state-owned Asian energy companies hungry to secure future energy needs and less concerned about Western political opprobrium have been slow to invest, analysts said.
If the U.S. eased the back-room pressure on banks to steer clear of financing energy projects in Iran, that could help the trickle of cash into the energy sector, said Fereidun Fesharaki, head of FACTS Global Energy, which advises companies on refining and marketing strategies.
"It's going to be a small breather," Fesharaki said. "We will go back to where we were two years ago. So the National Iranian Oil Company can borrow money and their projects can bring some capital in, but there won't be a big turnaround."
Pro-Western Bloc Defeats Hezbollah in Lebanon Vote
An American-backed alliance appeared to retain control of the Lebanese Parliament on Sunday in a hotly contested election that had been billed as a showdown between Tehran and Washington for influence in the Middle East.
Preliminary results reported on Lebanese television, showed the alliance, known as the March 14 coalition, had managed to preserve its majority in Parliament. If those results are confirmed, they would represent a significant and unexpected defeat for Hezbollah and its allies, Iran and Syria. Most polls had showed a tight race, but one in which the Hezbollah-led group would win.
The tentative victory might have been aided by nearly unprecedented turnout. The preliminary results showed that about 55 percent of the 3.26 million registered voters cast ballots. Lebanese television reported that the March 14 coalition, a predominantly Sunni, Christian, Druze alliance, held at least 67 seats out of 128 in Parliament.
Though the Hezbollah-led challengers appeared to lose, Hezbollah itself — a Shiite political, social and military organization that is officially regarded by the United States and Israel as a terrorist group — will continue to be one of Lebanon’s most powerful political forces. The biggest disappointment might well have been the retired Gen. Michel Aoun, who appeared to preserve his bloc of seats but left the Christian constituency divided.
The interest in the contest was so high that during the day, people waited up to four hours to vote, many, including the elderly and the infirm, standing in the hot sun and in packed hallways.
Thousands of troops fanned out across this small, fractured nation to keep the peace and stayed in the streets into the night as the results. Despite big crowds at polling places, though, there were few reports of disturbances, Lebanese and election monitoring officials said.
“There is the fate of the country this time,” said Mireille Fiani, 45, as she stood crushed up against a crowd inside a school to cast her vote.
The majority party in Parliament gets to build the next government, and set the direction of national policy. Had the opposition won, for example, there was the expectation that Lebanon would not cooperate with the international tribunal set up to investigate the assassination of Rafik Hariri, the former premier.
Initially it was expected to be a very close race, with political analysts saying that as few as seven seats might have decided the outcome of the contest. Even with the majority expanding its base by a few seats, there was likely still the need, analysts said, to bring the opposition into a national unity government. Lebanon remains a divided and polarized nation that needs stability if for no other reason than to deal with its foreign debt of $50 billion.
Official results were expected on Monday at noon here.
Three groups of election monitors have been deployed, including former President Carter’s organization. But even before the race began, it was marred by charges of unprecedented vote buying. In the most contested districts, there were reports of votes being bought for as much as $2,000, and thousands of expatriates received all-expense-paid trips to Lebanon to vote.
In one district, an ambulance brought hospital patients to the polls to cast ballots.
Lebanon has long been seen as a proxy battlefield for regional and global interests, and so foreign powers from Washington to Tehran have paid close attention. But its politics are also intensely local, with power divided among sect leaders who jealously guard their interests.
On one side is the March 14 coalition, which holds the majority bloc and is led by the Sunni Muslim Future Movement of Saad Hariri, whose father’s assassination in 2005 led to huge protests which forced Syria to withdraw its troops from Lebanon.
On the other side is the March 8 coalition, whose two main members are Hezbollah and the Christian party of Mr. Aoun, the Free Patriotic Movement.
If Hezbollah’s alliance had emerged victorious, it would have represented another step in the evolution of a once parochial Shiite militia that started as a guerrilla force fighting Israeli occupation of the south into a national institution that slowly has defined the identity of the state.
Hezbollah has said that it would work to build what it called a “culture of resistance,” and define the enemy of Lebanon as Israel and the United States. It also said it would make it a high priority to build a strong national military.
Instead, it is the March 14 group that appears to find itself having won greater legitimacy. When Mr. Hariri’s alliance first won in 2005, it did so as part of an alliance with Hezbollah. The two camps broke ties shortly after the election and for years since Hezbollah said that March 14 would not have had the majority if not for its help, and was therefore represented an illegitimate government.
Having won in opposition to Hezbollah would add a boost to the bloc’s legitimacy, political analysts said.
Mr. Aoun, on the other hand, walks away with less than when he entered the race. The Sunni and Shiite communities are largely united behind their respective parties. Mr. Aoun gambled that he would be able to bring the majority of Christian voters with him into the alliance with Hezbollah, and appears to have been rejected by his intended constituents.
That division was played out on Sunday in the election district known as Beirut One, where early results showed that General Aoun’s candidates lost. Soldiers in armored personnel carriers were stationed in the middle of Sassine Square as troops patrolled the sidewalks.
Joseph Khoury, 47, was overseeing an election office for the Lebanese Forces, a former militia turned political organization that is aligned with March 14. He said that victory was essential to preserve Lebanon’s independence. “We don’t want Iran to occupy Lebanon,” he said, relying on what has been described as a scare tactic to drum up votes.
Tony Badr, 22, a Lebanese Forces supporter, said that he was “disappointed,” that “a large Christian party has aligned with Syria and Iran and their agents,” Hezbollah.
But down the road, Christian supporters of Mr. Aoun said that the alliance with Mr. Hariri and his Saudi-backed March 14 group was more dangerous to Christians. “What am I going to tell you, Hezbollah is a party defending Lebanon,” said George Anid. “The Shia have simple hearts like us and they will protect us.”
Preliminary results reported on Lebanese television, showed the alliance, known as the March 14 coalition, had managed to preserve its majority in Parliament. If those results are confirmed, they would represent a significant and unexpected defeat for Hezbollah and its allies, Iran and Syria. Most polls had showed a tight race, but one in which the Hezbollah-led group would win.
The tentative victory might have been aided by nearly unprecedented turnout. The preliminary results showed that about 55 percent of the 3.26 million registered voters cast ballots. Lebanese television reported that the March 14 coalition, a predominantly Sunni, Christian, Druze alliance, held at least 67 seats out of 128 in Parliament.
Though the Hezbollah-led challengers appeared to lose, Hezbollah itself — a Shiite political, social and military organization that is officially regarded by the United States and Israel as a terrorist group — will continue to be one of Lebanon’s most powerful political forces. The biggest disappointment might well have been the retired Gen. Michel Aoun, who appeared to preserve his bloc of seats but left the Christian constituency divided.
The interest in the contest was so high that during the day, people waited up to four hours to vote, many, including the elderly and the infirm, standing in the hot sun and in packed hallways.
Thousands of troops fanned out across this small, fractured nation to keep the peace and stayed in the streets into the night as the results. Despite big crowds at polling places, though, there were few reports of disturbances, Lebanese and election monitoring officials said.
“There is the fate of the country this time,” said Mireille Fiani, 45, as she stood crushed up against a crowd inside a school to cast her vote.
The majority party in Parliament gets to build the next government, and set the direction of national policy. Had the opposition won, for example, there was the expectation that Lebanon would not cooperate with the international tribunal set up to investigate the assassination of Rafik Hariri, the former premier.
Initially it was expected to be a very close race, with political analysts saying that as few as seven seats might have decided the outcome of the contest. Even with the majority expanding its base by a few seats, there was likely still the need, analysts said, to bring the opposition into a national unity government. Lebanon remains a divided and polarized nation that needs stability if for no other reason than to deal with its foreign debt of $50 billion.
Official results were expected on Monday at noon here.
Three groups of election monitors have been deployed, including former President Carter’s organization. But even before the race began, it was marred by charges of unprecedented vote buying. In the most contested districts, there were reports of votes being bought for as much as $2,000, and thousands of expatriates received all-expense-paid trips to Lebanon to vote.
In one district, an ambulance brought hospital patients to the polls to cast ballots.
Lebanon has long been seen as a proxy battlefield for regional and global interests, and so foreign powers from Washington to Tehran have paid close attention. But its politics are also intensely local, with power divided among sect leaders who jealously guard their interests.
On one side is the March 14 coalition, which holds the majority bloc and is led by the Sunni Muslim Future Movement of Saad Hariri, whose father’s assassination in 2005 led to huge protests which forced Syria to withdraw its troops from Lebanon.
On the other side is the March 8 coalition, whose two main members are Hezbollah and the Christian party of Mr. Aoun, the Free Patriotic Movement.
If Hezbollah’s alliance had emerged victorious, it would have represented another step in the evolution of a once parochial Shiite militia that started as a guerrilla force fighting Israeli occupation of the south into a national institution that slowly has defined the identity of the state.
Hezbollah has said that it would work to build what it called a “culture of resistance,” and define the enemy of Lebanon as Israel and the United States. It also said it would make it a high priority to build a strong national military.
Instead, it is the March 14 group that appears to find itself having won greater legitimacy. When Mr. Hariri’s alliance first won in 2005, it did so as part of an alliance with Hezbollah. The two camps broke ties shortly after the election and for years since Hezbollah said that March 14 would not have had the majority if not for its help, and was therefore represented an illegitimate government.
Having won in opposition to Hezbollah would add a boost to the bloc’s legitimacy, political analysts said.
Mr. Aoun, on the other hand, walks away with less than when he entered the race. The Sunni and Shiite communities are largely united behind their respective parties. Mr. Aoun gambled that he would be able to bring the majority of Christian voters with him into the alliance with Hezbollah, and appears to have been rejected by his intended constituents.
That division was played out on Sunday in the election district known as Beirut One, where early results showed that General Aoun’s candidates lost. Soldiers in armored personnel carriers were stationed in the middle of Sassine Square as troops patrolled the sidewalks.
Joseph Khoury, 47, was overseeing an election office for the Lebanese Forces, a former militia turned political organization that is aligned with March 14. He said that victory was essential to preserve Lebanon’s independence. “We don’t want Iran to occupy Lebanon,” he said, relying on what has been described as a scare tactic to drum up votes.
Tony Badr, 22, a Lebanese Forces supporter, said that he was “disappointed,” that “a large Christian party has aligned with Syria and Iran and their agents,” Hezbollah.
But down the road, Christian supporters of Mr. Aoun said that the alliance with Mr. Hariri and his Saudi-backed March 14 group was more dangerous to Christians. “What am I going to tell you, Hezbollah is a party defending Lebanon,” said George Anid. “The Shia have simple hearts like us and they will protect us.”
If All Doctors Had More Time to Listen
WHEN Dr. José Batlle met his 93-year-old patient in her small Bronx apartment, she didn’t have much furniture beyond a small TV, a sofa and a wheelchair. What she did have in abundance were pills — 15 types from a variety of doctors, including a pulmonologist, a cardiologist and a gerontologist. He discovered that some medicines had expired, others were unnecessary and some were dangerous if taken together.
Sitting with his patient and her son, Dr. Batlle cut the number of her medicines to four. He also gave the family his personal cellphone number.
Before coming to see him, the woman had endured several emergency-room visits and hospital stays. With Dr. Batlle, she was able to avoid all of that.
Calling a doctor on his cell? No waiting for an appointment? It’s the type of service that Dr. Batlle tries to offer to all of his 1,500 patients. “I prefer to keep them healthy than treat them when they are sick,” he says.
The efforts of Dr. Batlle and other primary care physicians may get a boost at the federal level. The Obama administration is considering ways to persuade medical students to pursue careers in primary care by raising their pay, and is channeling them to work in underserved rural areas. And the White House has already set aside $2 billion for community health centers through the economic stimulus package.
But more far-reaching health care reform remains an uncertainty, and in the interim a small but growing number of doctors are trying to take matters into their own hands.
By stepping off the big-clinic treadmill, where doctors are sometimes asked to see a different patient every 15 minutes, Dr. Batlle has joined the vanguard of physicians trying to redefine health care. These doctors spend more time with patients, emphasize prevention and education to keep them healthy and can handle many medical problems without referrals to specialists.
In many cases, this kind of care can reduce a patient’s medical bills. That’s more crucial than ever: according to a study published online by the American Journal of Medicine, 60 percent of all bankruptcies in the United States in 2007 were driven by health care costs.
Exact numbers are hard to come by, but doctors involved in this movement, called “patient centered” practices, say its popularity is growing.
“I travel to a lot of medical conferences, and I’m meeting more and more doctors embarking on this path,” said Dr. L. Gordon Moore, who runs IdealMedicalPractices.org, a program to help small practices become more innovative and efficient. The Web site IdealMedicalHome.org has about 800 doctors who post and trade ideas, while more than 700 physicians have adopted methods from HowsYourHealth.org. Many of these doctors see fewer patients per day than they did before.
To make personalized care possible in an era when compensation is often tied to the number of patients they see, doctors use technology to streamline processes and reduce administrative costs. Dr. Batlle, for example, uses online appointment scheduling and manages his medical records electronically. He prescribes medications from his computer and offers virtual visits by phone and e-mail.
It cost Dr. Batlle about $25,000 to buy the technology to make all of this possible, but he estimates that he saves close to $100,000 a year in salaries and billing costs. And he has made enough money to begin renovations on a new office in Washington Heights in Manhattan.
The model seems to be working, according to a 2008 study by Dr. John H. Wasson at Dartmouth Medical School. His research showed that patients in patient-centered practices were more likely to say they were informed about how to manage chronic diseases and got the care they needed, compared with those in a national sample of medical practices. They also were less likely to say they had to wait for an appointment.
“If the goal is to deliver patient care when and how they want and need it, this is the way to go,” Dr. Wasson said.
Of course, even doctors in this movement acknowledge that it is not a panacea for the country’s health care problems. Privacy advocates warn that electronic patient records can be breached, and computer glitches can make patient records inaccessible for hours. Big clinics can be better for people who have several health problems and need easy access to a variety of specialists. Moreover, some doctors may not want to leave a big clinic because they feel they lack the technical or business skills they need — or because a salaried job there may be more stable in this economy.
And while the patient-centered movement is growing, the nation may not be able to afford to have all its primary care doctors reduce the number of patients they see. Across the country, primary care physicians are in short supply, in part because average salaries for family practitioners are the lowest of any medical specialty. According to a 2008 survey of physician salaries by the American Medical Group Association, their average annual salary is $201,555, versus $356,166 for a general surgeon and $614,536 for a neurological surgeon.
“Medical school loans can be so high, you need to be a specialist to pay them back,” Dr. Batlle said. “But our country doesn’t need yet another sleep apnea specialist.”
LILI SACKS, a primary care doctor in Seattle, says she began thinking differently about her work on the day she realized she was beginning each appointment with the words, “Sorry I’m late.”
Scheduled to see as many as 25 patients a day at a large clinic, she lacked the time for thorough examinations and discussions. Because of this, she said, primary care doctors are often forced to order tests and send patients to specialists.
“Could I have helped some people without specialists and tests? Absolutely,” said Dr. Sacks. “Would it have saved the patient and the insurance company both money? Absolutely. Is the system set up for the best care and cost efficiency? Absolutely not.”
Dr. Sacks said she worried that seeing so many patients would lead to errors. Last year, she moved to a clinic that focuses on longer patient appointments, 30 to 60 minutes. This translates to 10 to 12 patients a day. Patients also communicate directly with her by phone or e-mail.
During those longer appointments, Dr. Sacks can perform basic lab tests and simple procedures, so patients see fewer specialists.
“I probably head off a handful of emergency-room visits and hospital stays every month because patients can see me as soon as they have a problem, and I can be thorough rather than rushed,” she said.
One patient who avoided the emergency room was Todd Martin, a store manager in Seattle who went to Dr. Sacks’s clinic on a Saturday.
“I couldn’t stop coughing and was having trouble breathing,” Mr. Martin said. “They were able to see me and give me a chest X-ray.”
Mr. Martin said he spent $40 for the resulting prescription but the rest was covered by a monthly fee he pays Dr. Sacks. “A weekend visit to the E.R. would have easily cost $1,000,” he said.
Dr. Sacks charges patients a direct monthly fee of $54 to $129 based on age, and she doesn’t take insurance. Her office calls its philosophy “direct practice” because it’s a direct contract between doctor and patient. But she advises patients to obtain insurance plans to cover large, unexpected health costs like those to treat cancer or a heart attack.
“We say it’s like having a car and paying for your own oil changes and tuneups, but getting insurance in case you need a big repair,” she said.
Dr. Garrison Bliss, who in 2007 founded the group where Dr. Sacks works, has offered direct-practice services since 1997. He says patients can save 15 to 40 percent of their medical costs by using this model, based on his examination of insurance rates and his belief that good primary care can fill most of a patient’s needs.
Insurance plans that cover every little thing can be very expensive, Dr. Bliss said. He said that a patient who paid an annual fee at his clinic and took out a higher-deductible insurance plan would usually come out ahead, even if the patient’s health needs meant that he or she had to pay the entire deductible.
Dr. Bliss’s office operates with just two administrative employees for seven doctors. He estimates that if he took insurance, one or two administrative workers would be needed per doctor.
Insurance administration costs can take a big bite out of a practice’s revenue. A recent Weill Cornell Medical College study found that a third of the money received by primary care physicians pays for interactions between a doctor’s practice and patients’ health plans.
Patricia Rogers Caroselli, a retired assistant principal who is a patient of Dr. Sacks, dreaded going to her former clinic. “The waiting room was always noisy and crowded,” she said. In the examining room, she felt that she should “get in and out and not waste the doctor’s time with questions,” she said.
In contrast, she said, she appreciates the friendly calm of Dr. Sacks’s new surroundings and the personal attention. “Everyone should have this kind of patient care,” she said.
Dr. Sacks said the financial mechanics of the direct-practice model match her medical goals. When she was compensated based on insurance, she was paid every time she saw a patient. Now, if she can use education and prevention to reduce office visits, she and her patients benefit, she said.
“Having more time to sit with each patient has made me a better doctor,” she said. “I had a disabled patient that I saw for 13 years. Until she came to my new clinic, I never had the time to learn the details of her accident and the resulting complications. I was always treating whatever the immediate concern was.”
TECHNOLOGY has helped many doctors reduce costs. Dr. Batlle says he has been building his arsenal of technology solutions one by one, with “lots of trial and error,” for eight years.
Recently, he saw a 52-year-old patient with hypertension. As he examined the patient, noting blood pressure and other vital signs, he entered the information into his laptop computer to add to the patient’s electronic medical record. He also typed in the codes for billing and insurance.
The patient wondered if he was due for a prescription refill, so Dr. Batlle checked his computer again, found that he was, and hit a button to send the refill request to the pharmacy. As the patient left, Dr. Batlle hit the keyboard to send the bill electronically to the insurance company.
“He’ll even go to the Web to schedule his follow-up appointment,” Dr. Batlle said. “I don’t pay a receptionist to sit and answer phones.”
Dr. Batlle says other doctors could outfit an office for less than the $25,000 he spent on technology.
“Most doctors think they need to hire two receptionists, a billing person and two nurses to run a primary care office,” he said. “But they can learn about these technologies from other doctors, and the software salespeople do some training.”
Some physicians hire consultants to find and install the right equipment. Doctors who want to switch to electronic health records may also receive financial support from the government through the stimulus package.
By using new technology and streamlining processes, small primary care practices can reduce their costs to half of what a typical practice pays, from about 60 percent of income down to 30 percent, Dr. Wasson said. He said that doctors who focus on reducing their costs can see fewer patients without sacrificing income. Dr. Sacks said she and her colleagues didn’t have to take a pay cut when they moved to Dr. Bliss’s practice.
As Congress and the Obama administration begin to focus more closely on health care, some primary care doctors are weighing in. Dr. Bliss, for instance, has been to Washington twice in the last month to share his ideas with legislators. He knows he’s in a debate with powerful voices, especially insurance companies and hospitals. So he and other doctors are encouraging patients to speak up as well.
“We need to bring the patients to the barricades with us,” Dr. Batlle says
Sitting with his patient and her son, Dr. Batlle cut the number of her medicines to four. He also gave the family his personal cellphone number.
Before coming to see him, the woman had endured several emergency-room visits and hospital stays. With Dr. Batlle, she was able to avoid all of that.
Calling a doctor on his cell? No waiting for an appointment? It’s the type of service that Dr. Batlle tries to offer to all of his 1,500 patients. “I prefer to keep them healthy than treat them when they are sick,” he says.
The efforts of Dr. Batlle and other primary care physicians may get a boost at the federal level. The Obama administration is considering ways to persuade medical students to pursue careers in primary care by raising their pay, and is channeling them to work in underserved rural areas. And the White House has already set aside $2 billion for community health centers through the economic stimulus package.
But more far-reaching health care reform remains an uncertainty, and in the interim a small but growing number of doctors are trying to take matters into their own hands.
By stepping off the big-clinic treadmill, where doctors are sometimes asked to see a different patient every 15 minutes, Dr. Batlle has joined the vanguard of physicians trying to redefine health care. These doctors spend more time with patients, emphasize prevention and education to keep them healthy and can handle many medical problems without referrals to specialists.
In many cases, this kind of care can reduce a patient’s medical bills. That’s more crucial than ever: according to a study published online by the American Journal of Medicine, 60 percent of all bankruptcies in the United States in 2007 were driven by health care costs.
Exact numbers are hard to come by, but doctors involved in this movement, called “patient centered” practices, say its popularity is growing.
“I travel to a lot of medical conferences, and I’m meeting more and more doctors embarking on this path,” said Dr. L. Gordon Moore, who runs IdealMedicalPractices.org, a program to help small practices become more innovative and efficient. The Web site IdealMedicalHome.org has about 800 doctors who post and trade ideas, while more than 700 physicians have adopted methods from HowsYourHealth.org. Many of these doctors see fewer patients per day than they did before.
To make personalized care possible in an era when compensation is often tied to the number of patients they see, doctors use technology to streamline processes and reduce administrative costs. Dr. Batlle, for example, uses online appointment scheduling and manages his medical records electronically. He prescribes medications from his computer and offers virtual visits by phone and e-mail.
It cost Dr. Batlle about $25,000 to buy the technology to make all of this possible, but he estimates that he saves close to $100,000 a year in salaries and billing costs. And he has made enough money to begin renovations on a new office in Washington Heights in Manhattan.
The model seems to be working, according to a 2008 study by Dr. John H. Wasson at Dartmouth Medical School. His research showed that patients in patient-centered practices were more likely to say they were informed about how to manage chronic diseases and got the care they needed, compared with those in a national sample of medical practices. They also were less likely to say they had to wait for an appointment.
“If the goal is to deliver patient care when and how they want and need it, this is the way to go,” Dr. Wasson said.
Of course, even doctors in this movement acknowledge that it is not a panacea for the country’s health care problems. Privacy advocates warn that electronic patient records can be breached, and computer glitches can make patient records inaccessible for hours. Big clinics can be better for people who have several health problems and need easy access to a variety of specialists. Moreover, some doctors may not want to leave a big clinic because they feel they lack the technical or business skills they need — or because a salaried job there may be more stable in this economy.
And while the patient-centered movement is growing, the nation may not be able to afford to have all its primary care doctors reduce the number of patients they see. Across the country, primary care physicians are in short supply, in part because average salaries for family practitioners are the lowest of any medical specialty. According to a 2008 survey of physician salaries by the American Medical Group Association, their average annual salary is $201,555, versus $356,166 for a general surgeon and $614,536 for a neurological surgeon.
“Medical school loans can be so high, you need to be a specialist to pay them back,” Dr. Batlle said. “But our country doesn’t need yet another sleep apnea specialist.”
LILI SACKS, a primary care doctor in Seattle, says she began thinking differently about her work on the day she realized she was beginning each appointment with the words, “Sorry I’m late.”
Scheduled to see as many as 25 patients a day at a large clinic, she lacked the time for thorough examinations and discussions. Because of this, she said, primary care doctors are often forced to order tests and send patients to specialists.
“Could I have helped some people without specialists and tests? Absolutely,” said Dr. Sacks. “Would it have saved the patient and the insurance company both money? Absolutely. Is the system set up for the best care and cost efficiency? Absolutely not.”
Dr. Sacks said she worried that seeing so many patients would lead to errors. Last year, she moved to a clinic that focuses on longer patient appointments, 30 to 60 minutes. This translates to 10 to 12 patients a day. Patients also communicate directly with her by phone or e-mail.
During those longer appointments, Dr. Sacks can perform basic lab tests and simple procedures, so patients see fewer specialists.
“I probably head off a handful of emergency-room visits and hospital stays every month because patients can see me as soon as they have a problem, and I can be thorough rather than rushed,” she said.
One patient who avoided the emergency room was Todd Martin, a store manager in Seattle who went to Dr. Sacks’s clinic on a Saturday.
“I couldn’t stop coughing and was having trouble breathing,” Mr. Martin said. “They were able to see me and give me a chest X-ray.”
Mr. Martin said he spent $40 for the resulting prescription but the rest was covered by a monthly fee he pays Dr. Sacks. “A weekend visit to the E.R. would have easily cost $1,000,” he said.
Dr. Sacks charges patients a direct monthly fee of $54 to $129 based on age, and she doesn’t take insurance. Her office calls its philosophy “direct practice” because it’s a direct contract between doctor and patient. But she advises patients to obtain insurance plans to cover large, unexpected health costs like those to treat cancer or a heart attack.
“We say it’s like having a car and paying for your own oil changes and tuneups, but getting insurance in case you need a big repair,” she said.
Dr. Garrison Bliss, who in 2007 founded the group where Dr. Sacks works, has offered direct-practice services since 1997. He says patients can save 15 to 40 percent of their medical costs by using this model, based on his examination of insurance rates and his belief that good primary care can fill most of a patient’s needs.
Insurance plans that cover every little thing can be very expensive, Dr. Bliss said. He said that a patient who paid an annual fee at his clinic and took out a higher-deductible insurance plan would usually come out ahead, even if the patient’s health needs meant that he or she had to pay the entire deductible.
Dr. Bliss’s office operates with just two administrative employees for seven doctors. He estimates that if he took insurance, one or two administrative workers would be needed per doctor.
Insurance administration costs can take a big bite out of a practice’s revenue. A recent Weill Cornell Medical College study found that a third of the money received by primary care physicians pays for interactions between a doctor’s practice and patients’ health plans.
Patricia Rogers Caroselli, a retired assistant principal who is a patient of Dr. Sacks, dreaded going to her former clinic. “The waiting room was always noisy and crowded,” she said. In the examining room, she felt that she should “get in and out and not waste the doctor’s time with questions,” she said.
In contrast, she said, she appreciates the friendly calm of Dr. Sacks’s new surroundings and the personal attention. “Everyone should have this kind of patient care,” she said.
Dr. Sacks said the financial mechanics of the direct-practice model match her medical goals. When she was compensated based on insurance, she was paid every time she saw a patient. Now, if she can use education and prevention to reduce office visits, she and her patients benefit, she said.
“Having more time to sit with each patient has made me a better doctor,” she said. “I had a disabled patient that I saw for 13 years. Until she came to my new clinic, I never had the time to learn the details of her accident and the resulting complications. I was always treating whatever the immediate concern was.”
TECHNOLOGY has helped many doctors reduce costs. Dr. Batlle says he has been building his arsenal of technology solutions one by one, with “lots of trial and error,” for eight years.
Recently, he saw a 52-year-old patient with hypertension. As he examined the patient, noting blood pressure and other vital signs, he entered the information into his laptop computer to add to the patient’s electronic medical record. He also typed in the codes for billing and insurance.
The patient wondered if he was due for a prescription refill, so Dr. Batlle checked his computer again, found that he was, and hit a button to send the refill request to the pharmacy. As the patient left, Dr. Batlle hit the keyboard to send the bill electronically to the insurance company.
“He’ll even go to the Web to schedule his follow-up appointment,” Dr. Batlle said. “I don’t pay a receptionist to sit and answer phones.”
Dr. Batlle says other doctors could outfit an office for less than the $25,000 he spent on technology.
“Most doctors think they need to hire two receptionists, a billing person and two nurses to run a primary care office,” he said. “But they can learn about these technologies from other doctors, and the software salespeople do some training.”
Some physicians hire consultants to find and install the right equipment. Doctors who want to switch to electronic health records may also receive financial support from the government through the stimulus package.
By using new technology and streamlining processes, small primary care practices can reduce their costs to half of what a typical practice pays, from about 60 percent of income down to 30 percent, Dr. Wasson said. He said that doctors who focus on reducing their costs can see fewer patients without sacrificing income. Dr. Sacks said she and her colleagues didn’t have to take a pay cut when they moved to Dr. Bliss’s practice.
As Congress and the Obama administration begin to focus more closely on health care, some primary care doctors are weighing in. Dr. Bliss, for instance, has been to Washington twice in the last month to share his ideas with legislators. He knows he’s in a debate with powerful voices, especially insurance companies and hospitals. So he and other doctors are encouraging patients to speak up as well.
“We need to bring the patients to the barricades with us,” Dr. Batlle says
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