Progress in covering low- and moderate-income populations falters

Posted by on Thursday, May 26, 2016

This entry is from Dr. McCanne's Quote of the Day, a daily health policy update on the single-payer health care reform movement. The QotD is archived on PNHP's website.

Americans’ Experiences with ACA Marketplace and Medicaid Coverage: Access to Care and Satisfaction

By Sara R. Collins, Munira Gunja, Michelle M. Doty, Sophie Beutel
The Commonwealth Fund, May 25, 2016 

Abstract

The fourth wave of the Commonwealth Fund Affordable Care Act Tracking Survey, February–April 2016, finds at the close of the third open enrollment period that the working-age adult uninsured rate stands at 12.7 percent, statistically unchanged from 2015 but significantly lower than 2014 and 2013. Uninsured rates in the past three years have fallen most steeply for low-income adults though remain higher compared to wealthier adults. ACA marketplace and Medicaid coverage is helping to end long bouts without insurance, bridge gaps when employer insurance is lost, and improve access to health care. Sixty-one percent of enrollees who had used their insurance to get care said they would not have been able to afford or access it prior to enrolling. Doctor availability and appointment wait times are similar to those reported by insured Americans overall. Majorities with marketplace or Medicaid coverage continue to be satisfied with their insurance.

Exhibit 2: Uninsured Rates Among Low-Income Adults Have Fallen the Most But Remain Substantially Higher Than Those For Adults with Higher Incomes

People with low and moderate incomes — the population targeted in particular by the ACA’s reforms — had the highest uninsured rates prior to the law’s enactment and subsequently have experienced the greatest gains in coverage by far. But after declining steeply in 2014, uninsured rates for adults with incomes below 138 percent of the federal poverty level ($16,243 for an individual and $33,465 for a family of four) have remained about the same. Similarly, uninsured rates for those with incomes between 138 percent and 249 percent of poverty ($29,425 for an individual and $60,625 for a family of four) had fallen by half by 2015 but remain nearly the same this year. Consequently, low- and moderate-income adults are uninsured at rates as much as 10 times higher as those for adults with higher incomes.

Conclusion and Policy Implications

After falling sharply in 2014 upon rollout of the ACA’s major coverage expansions, the uninsured rate for U.S. working-age adults has been declining at a slower pace. The chasm in insurance coverage between lower- and higher-income adults remains troubling. We will explore the possible reasons for this in a forthcoming brief.

In each year since the coverage expansions, our survey findings have indicated that overall enrollment has been propelled by people who were previously uninsured — a year or longer for the vast majority. Consistent with other national surveys and Congressional Budget Office analyses, enrollment has not been driven by people shifting out of employer coverage: the share of adults insured through an employer has declined only slightly since 2013. The survey findings do suggest that for people who lose their job-based health benefits, the expanded insurance options may be helping to bridge the coverage gap.

http://www.commonwealthfund.org/publications/issue-briefs/2016/may/ACA-tracking-survey-access-to-care-and-satisfaction

The Affordable Care Act (ACA) has been effective in reducing the numbers of uninsured, particularly amongst low-income adults. Although that is good news, we should be alarmed that “low- and moderate-income adults are uninsured at rates as much as 10 times higher as those for adults with higher incomes,” and that there has been little improvement in enrollment for these lower income levels since the initial steep decline in 2014.

When ACA was constructed, it was decided that the employer-sponsored plans should be left largely alone to continue to fulfill the role of covering the majority of middle- and higher-income individuals and families. The greatest need was for the uninsured low-income and uninsured moderate-income sectors of the population. Thus two of the more important design features of ACA were to expand Medicaid for low-income individuals and to offer income-indexed tax credits and subsidies for private plans offered through the ACA exchanges (Marketplace).

How successful has the plan to cover those with greater financial needs been? As stated, uninsurance for those with low and moderate incomes has stabilized at a rate 10 times higher than those with higher incomes. Except for an initial surge, ACA has failed to achieve the goal of covering these more vulnerable populations.

They would have all been covered under a single payer system. Not only that, the ACA model of reform is the most expensive model of all, yet falls miserably short in universality, efficiency and equity. The least expensive comprehensive models of reform that would have actually achieved these goals are single payer Medicare for all or a government owned and operated national health service.

Although “socialism” has become less of a pejorative in the United States, the majority of residents would prefer the social insurance model of Medicare for all rather than socialized medicine through a national health service model. Now that ACA has been demonstrated to be an over-priced failure, we should move on with establishing an Improved Medicare for All.

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Here’s what CEOs think of candidates’ healthcare ideas

Posted by on Tuesday, May 24, 2016

This entry is from Dr. McCanne's Quote of the Day, a daily health policy update on the single-payer health care reform movement. The QotD is archived on PNHP's website.

By Shannon Muchmore
Modern Healthcare, May 21, 2016

The CEO Power Panel includes 110 top leaders of hospitals, insurance companies, physician groups, trade associations and other not-for-profit advocacy groups. The second-quarter survey on policy options that the next president and Congress might address attracted 86 respondents, a 78% response rate.

Future of ACA

Do you support Congress and the next president in:

Repealing and replacing the Affordable Care Act?

2.3% – Yes
67.4% – No
29.1% – It depends on the details
1.2% – No opinion

Expanding the ACA’s subsidized private insurance plan system to achieve universal coverage?

34.9% – Yes
15.1% – No
48.8% – It depends on the details
1.2% – No opinion

Scrapping private insurance in favor of expanding an enhanced Medicare to cover the entire population (single payer)?

9.3% – Yes
61.6% – No
29.1% – It depends on the details

Other insurance issues

Allowing private insurers to sell individual and family policies across state lines under national rules that preempt state rules?

52.3% – Yes
20.9% – No
24.4% – It depends on the details
2.3% – No opinion

Expanding the use of health savings accounts to pay premiums and meet costs under high-deductible plans?

74.4% – Yes
11.6% – No
12.8% – It depends on the details
1.2% – No opinion

Creating subsidized high-risk pools to cover people with preexisting conditions?

43.0% – Yes
16.3% – No
36.1% – It depends on the details
4.7% – No opinion

Medicare

Raising Medicare eligibility to age 67?

54.7% – Yes
23.3% – No
22.1% – It depends on the details

Expanding means testing within Medicare, such as higher co-pays or reduced benefits for high-income seniors?

50.0% – Yes
18.6% – No
30.2% – It depends on the details
1.2% – No opinion

Moving to a universal Medicare Advantage system with a means-tested defined contribution (premium support) for seniors?

28.2% – Yes
20.0% – No
48.2% – It depends on the details
3.5% – No opinion

Gradually expanding Medicare to cover everyone over age 55 who doesn’t have private insurance?

21.4% – Yes
48.8% – No
28.6% – It depends on the details
1.2% – No opinion

Delivery system reform

Taking aggressive measures to curb rising prescription drug prices such as allowing imports and authorizing the CMS to negotiate prices?

70.6% – Yes
9.4% – No
20.0% – It depends on the details

Repealing delivery system reforms such as value-based payment, accountable care organizations and the use of quality measures included in the Affordable Care Act?

3.5% – Yes
83.5% – No
11.8% – It depends on the details
1.2% – No opinion

http://www.modernhealthcare.com/article/20160521/MAGAZINE/305219938/healthcare-ceos-reject-veering-sharply-from-acas-path

This poll of selected “top leaders of hospitals, insurance companies, physician groups, trade associations and other not-for-profit advocacy groups” can give us a rough idea of where the executive leadership of the health care industry stands today on health care reform. A few conclusions:

* These CEOs strongly support the Affordable Care Act (ACA). That is not surprising since these vested stakeholders were part of the process that created the legislation..

* They are uncertain on whether or not the private insurance plans should be expanded to achieve universal coverage, although one-third would agree with they should be. The majority may be concerned about the potential of being required to cover care for those with greater health care needs (adverse selection) without being able to transfer risk elsewhere..

* Over 60 percent oppose replacement of private plans with a single payer enhanced Medicare for all and another 30 percent say that it depends on the details. Only 9 percent support single payer outright. This suggests that ACA was indeed designed with these stakeholders in mind, rather than for the patients..

* At least three-fourths support health savings accounts, tacitly supporting high deductible health plans that are a source of financial hardship for far too many individuals who have health care needs..

* At least half support selling insurance across state lines even though that is not practical because of problems such as building new provider networks in other states..

* Close to half support creating subsidized high-risk pools to cover people with preexisting conditions, even though the experience with state high-risk pools has been very disappointing. They are too expensive so benefits have been too meager. Besides they have been unable to cover most eligible individuals in spite of the need..

* Over half support raising Medicare eligibility age to 67, cutting back on coverage when we need to do is increase it instead..

* They would expand means-testing of Medicare, risking support of higher income individuals for the program..

* Somewhat surprisingly there is less support for Medicare vouchers for private plans (premium support), but perhaps that is due to the fact that the premium support strategy is designed to eventually reduce government payments for Medicare. After half of a century, Medicare is here to stay, and the stakeholders do recognize the need for adequate government funds to support the program..

* Only one-fifth support allowing individuals the option of enrolling in Medicare at age 55. Half are clearly opposed. They do not want to displace employer-sponsored plans presumably because they pay higher rates than does Medicare..

* By far the strongest support is for “delivery system reforms such as value-based payment, accountable care organizations and the use of quality measures included in the Affordable Care Act.” Evidence to date with these “value over volume” proposals has been disappointing, demonstrating little savings and negligible impact on quality. One possible reason they may be popular for CEOs is that their companies have learned to game the system to collect the rewards offered by these programs.

It is likely that most of these CEOs are relatively conservative politically since they predominantly support policies advanced by the “repeal and replace” Republicans, even though they do support ACA. They also strongly oppose Medicare for all single payer in spite of it being supported by a majority of Americans. Some of the policies they support would make access and affordability worse for patients, yet these policies can be self-serving for their own entities.

This survey of health industry CEOs leads me to the conclusion that the wrong people were sitting at the table when ACA was designed. For our redo, we need people at the table who represent patients rather than the health industries. A system that takes care of patients automatically takes care of legitimate stakeholders, but the reverse has not been true. It’s time to change. Single payer.

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Woolhandler and Himmelstein respond to Urban Institute’s doubling down on errors

Posted by on Monday, May 23, 2016

This entry is from Dr. McCanne's Quote of the Day, a daily health policy update on the single-payer health care reform movement. The QotD is archived on PNHP's website.

Response to Criticisms of Our Analysis of the Sanders Health Care Reform Plan

By Linda J. Blumberg, John Holahan, Lisa Clemans-Cope, Matthew Buettgens
Urban Institute, May 18, 2016

Abstract

The Sanders campaign and David Himmelstein and Steffie Woolhandler reacted with sharp criticisms to our recent report, The Sanders Single-Payer Health Care Plan: The Effect on National Health Expenditures and Federal and Private Spending. In this brief, we discuss our key assumptions in these areas of disagreement and highlight ways in which we may have actually underestimated overall costs of the Sanders proposal. By and large our assumptions are laid out thoroughly in the original paper, but here we use them to address the specific statements made by the campaign.

Conclusion

All cost estimates of new programs carry some uncertainty, but ours are based in the best empirical literature and data, methodological expertise, and a deep knowledge of the health care system. We believe we have made conservative assumptions with regard to this proposed plan, but it is possible we have somewhat overestimated administrative costs and underestimated long-term care and assorted other costs; we acknowledge this, of course. However, using reasoned analysis based upon empirical research and in-depth knowledge of the US health care system, there is no way to avoid the conclusion that the Sanders plan, while achieving universal coverage, would massively increase federal spending and require much larger tax increases than he has proposed.

http://www.urban.org/research/publication/response-criticisms-our-analysis-sanders-health-care-reform-plan

***

Doubling Down on Errors: Urban Institute Defends Its Ridiculously High Single Payer Cost Estimates

By Steffie Woolhandler and David Himmelstein
The Huffington Post, May 22, 2016

Last week we posted a critique of the Urban Institute’s (UI) absurdly biased report that claimed Sen. Bernie Sanders’ proposal for single-payer health reform would cause a massive increase in health spending. Now, the report’s authors have issued a 12-page rejoinder to our criticism. But that response is riddled with distortions, misinterpretations and glaring factual errors. Moreover, they now make it clear that they didn’t even try to estimate the costs of Sanders’ (or our) single-payer proposals. Instead, they made up their own reform proposal and costed that out.

Our critique identified three main problems with the UI’s projection that implementing single payer would boost total health spending by $519 billion in 2017. First, UI ignored about 75 percent of the administrative savings that single-payer reform would achieve. Second, it substantially underestimated single payer’s savings on prescription drugs. And finally, it posited an absurdly large increase in the utilization of health care under single payer, far more than could possibly be provided by the current supply of doctors and hospitals.

Below, we briefly discuss the UI’s response to those criticisms, and the facts of the matter.

1. Administrative savings, Part 1: The original UI report projected that single payer could cut insurance overhead from the current 9.5 percent of health spending ($341 billion) to 6 percent ($215 billion). As they now admit, they were modeling a compromised single-payer system, in which private managed care insurers like UnitedHealthcare would continue to play a major role, as they do in the Medicare Advantage program. (Neither we nor Sanders have suggested such a continued role for private insurers.) We pointed out that Canada’s single-payer system runs for 1.8 percent overhead (a figure they impugn, but which is taken directly from Canada’s official health statistics), and is similar to the overhead in the traditional Medicare program. Reducing our insurance overhead to the Canadian level would mean cutting it to “only” $65 billion. There’s no reason to believe we can’t be as efficient as Canada if we, like Canada, proscribe participation by private insurers.

The UI rejoinder argues that “it would be inadvisable to cut administrative costs so much that important functions could not be carried out effectively under a new system. Such functions include rate setting for many different providers of different types facing different costs across the country; quality control over care provision; development, review, and revision of regulations; oversight for fraudulent activity; provider oversight and enforcement of standards; bill payment to providers; consumer services; and more.” Of course traditional Medicare (and Canada) are already doing all of those things, and the UI response gives no reason why $65 billion can’t do the job.

2. Administrative savings, Part 2: The original UI estimate projected that single-payer reform wouldn’t realize any savings on the vast amounts hospitals and doctors currently spend on billing and paperwork. Yet, Sanders’ (and our) proposals would enormously simplify this billing and paperwork. We noted that reliable studies published in the most respected medical and policy journals have documented these provider administrative savings, and that numerous single-payer estimates by the Congressional Budget Office, the Government Accountability Office and private consultants have all assumed that these savings would occur.

In response, our UI colleagues continue to project zero administrative savings for providers, but say: “We agree that administrative costs would fall, but we do not agree they would be close to zero as HW [Himmelstein and Woolhandler] assert.” Actually, we never asserted any such thing. We wrote that “U.S. hospitals spend one-quarter of their total budgets on billing and administration, more than twice as much as hospitals spend in single-payer systems like Canada’s or Scotland’s. Similarly, U.S. physicians, who must bill hundreds of different insurance plans with varying payment and coverage rules, spend two to three times as much as our Canadian colleagues on billing.” Our estimate that cutting U.S. providers’ administrative costs to Canadian levels would save about $2.57 trillion over 10 years was based on this well-established (and peer-reviewed) data.

3. Drug prices: The latest UI piece restated their conviction that a U.S. single-payer system could get only half the discounts that single-payer systems in other nations have gotten from drug companies (and would actually raise drug prices for patients currently on Medicaid). They continue to offer no reason why the discounts would be so small. Moreover, they now claim that Himmelstein and Woolhandler “argue incorrectly that we ignored savings from paying less for prescription drugs.” In fact we didn’t ignore their estimated savings, but said they should be two-fold higher than the 25 percent they projected.

4. Utilization of care, Part 1: The original UI report estimated that single-payer reform would cause a $519 billion increase in health spending in 2017, even accounting for some savings on administration and drugs. But we noted that there just aren’t enough hospital beds or doctors to meet the huge surge in visits and hospitalizations they predict. To back up our claim we cited data from Canada (when its single-payer reform was implemented) and the U.S. (when Medicare and Medicaid were implemented). These data document that no, or very modest increases in society-wide use of care, occurred, and that instead care shifted from the rich and healthy to the sick and poor.

In response, the UI rejoinder says: “Contrary to HW’s [Himmelstein and Woolhandler’s] claim in their article, health care use and spending for the elderly population did increase substantially once the Medicare program was implemented in 1965.” Here (as in their claim about our statement on providers’ administrative costs) they have misquoted us. We wrote that “between 1964 (before Medicare) and 1966 (the year when Medicare was fully functioning) there was absolutely no increase in the total number of doctor visits,” and that “the same thing happened in hospitals.” While we are well aware that utilization by the elderly and the poor went up after Medicare and Medicaid were implemented, the point is that there was a compensatory, slight reduction in utilization by other Americans, reflecting the limitations imposed by the existing supply of hospital beds and doctors (most of whom were already working full time).

Here’s the actual data on the number of doctor visits per person (not just the elderly) before and after Medicare/Medicaid:

(Table in original article – link below)

And here’s the actual data on the total number of hospitalizations:

(Table in orignal article – link below)

In sum, we were correct in stating that the overall utilization of care showed no surge.

5. Utilization of care, Part 2: We noted in our critique that the lack of a surge in overall utilization in Canada, or with the start-up of Medicare/Medicaid, reflected a shift of care, with the newly insured poor and sick patients getting more of the care they needed, and the healthy and wealthy getting less elective and unnecessary care.

The UI rejoinder disputes that such a shift could occur. “HW [Himmelstein and Woolhandler] indicate that use would increase for the newly insured but would decrease by a similar amount for those already covered as physicians cease unnecessary services for those otherwise covered and perform additional necessary care for those otherwise uninsured. This assumption is faulty for two major reasons. First, no uniform definition of what is necessary and unnecessary exists in medical care; if such a definition existed, insurers would stop paying for all unnecessary care under our current health system. Second, there is absolutely no reason to believe that higher-income, currently insured individuals would lower their use of care under provider supply constraints.”

Their puzzlement displays a lack of familiarity with the considerable literature on variability in the utilization of care between different areas in the U.S., as well as the actual practice of medicine. John Wennberg and colleagues long ago observed that the number of surgical operations in a community showed only modest correlation with needs of the population, but was strongly correlated (r=.64) with the supply of surgeons.

As any doctor knows, doctors play a large role in regulating the amount of care they deliver. If we have no free appointment slots for the next month we’re likely to put off seeing our healthy patients a bit longer. Gastroenterologists often perform unnecessary screening colonoscopies. That’s not something many patients would demand. Indeed, the Aday paper referenced (to support a different point) in the UI rejoinder makes exactly our point: “After Medicare and Medicaid were introduced, providers may have begun to ration the number of visits by the ‘well-to-do’ to accommodate the influx of low-income patients with newly acquired purchasing power and a backlog of unmet need.”

In sum, there’s considerable evidence that doctor routinely adjust the utilization of care by their patients, and that when many additional people gain coverage, doctors shift care to this newly insured group, and compensate by reducing unneeded care for the wealthy and healthy.

6. What system was the UI analyzing? The UI researchers claimed to be estimating the budgetary impact of Sen. Sanders’ proposal. Yet now they tell us, “To be politically acceptable, compromises would have to be made, and those compromises are reflected in our assumptions.” In other words, their estimates are not actually based on the reform that Sanders (or we) have recommended. Instead they assume that the insurance and drug companies are too powerful to really rein in.

Overall, the UI response misrepresents key elements of our critique, and fails to address the erroneous assumptions that underlay their original analysis. Single-payer systems elsewhere provide more and better care at a lower price than we pay. The administrative bloat of our market-driven payment system accounts for much of the difference. While we recognize that a transition to a true single-payer system faces stiff political headwinds, it’s medically and economically feasible. And as Sen. Sanders has shown, political climates can be changed.

Drs. Woolhandler and Himmelstein are internists in the South Bronx, professors at the City University of New York School of Public Health at Hunter College, and lecturers in medicine at Harvard Medical School. The opinions expressed do not necessarily reflect those institutions’.

http://www.huffingtonpost.com/steffie-woolhandler/urban-institute-errors-single-payer-costs_b_10100836.html

The media continue to cite the flawed Urban Institute analysis of the costs of single payer while ignoring the actual facts as presented by David Himmelstein and Steffie Woolhandler. Yet the Urban Institute authors twice have felt compelled to answer the Himmelstein/Woolhandler criticism of their analysis. Woolhandler and Himmelstein respond here to Urban’s doubling down of errors in their second response.

The fundamental fact remains: “Single-payer systems elsewhere provide more and better care at a lower price than we pay.” The $3 trillion we are already spending on health care is enough to finance a comprehensive single-payer system here in the United States.

Shifting more health care spending to the federal budget is not a flaw of single payer, as Urban implies, but actually a benefit because it makes the funding more equitable and efficient.

We need to hold the media to the truth – the full truth.

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Growing dissatisfaction with higher premiums and greater cost-sharing

Posted by on Friday, May 20, 2016

This entry is from Dr. McCanne's Quote of the Day, a daily health policy update on the single-payer health care reform movement. The QotD is archived on PNHP's website.

Survey of Non-Group Health Insurance Enrollees, Wave 3

By Liz Hamel, Jamie Firth, Larry Levitt, Gary Claxton, and Mollyann Brodie
Kaiser Family Foundation, May 20, 2016

This survey is the third in a series that seeks to shed light on the experiences and opinions of those purchasing their own health insurance in the non-group market.

A somewhat higher share of non-group enrollees now report being in plans with high deductibles than did so in 2015. In the current survey, about half (49 percent) of those with ACA-compliant non-group coverage say their plan has an annual individual deductible of at least $1,500 or a family deductible of at least $3,000, up from just over a third (36 percent) last year. Those with Marketplace plans are somewhat less likely to report having a high deductible (46 percent, compared with 61 percent of those in ACA-compliant non-Marketplace plans), likely because many Marketplace enrollees qualify for cost-sharing subsidies that lower their deductible.

Health plan ratings and satisfaction with coverage

Similar to the trend in overall plan ratings, the current survey finds those with ACA-compliant non-group plans are less likely than in previous years to say their coverage is an “excellent” or “good” value for what they pay for it. Just over half (54 percent) now rate the value of their coverage as “only fair” or “poor” (up from 42 percent in 2015 and 39 percent in 2014). Those with employer-sponsored coverage, who generally pay a lower portion of their premium, are more likely than those with non-group coverage to see their plan as at least a “good” value for the money, but the share of this group saying the value is “only fair” or “poor” has also increased, from 28 percent in 2014 to 40 percent in 2016.

A majority of enrollees also say they are satisfied with their plan’s premium (54 percent of all those in ACA-compliant plans and 59 percent of those in Marketplace plans), and about half say the same about their deductible (50 percent of ACA-compliant enrollees and 51 percent of Marketplace enrollees). However, satisfaction with premiums and deductibles has declined since 2014. Nearly half now say they are dissatisfied with their plan’s annual deductible (47 percent among all those ACA-compliant plans and 46 percent in Marketplace plans), and four in ten are dissatisfied with their monthly premium (43 percent and 40 percent, respectively).

Each of these trends toward more negative ratings of non-group coverage may be related to the fact that more enrollees now report being in high-deductible plans (as noted above, 49 percent of those with ACA-compliant plans now have a high-deductible plan, up from 36 percent in 2015). The latest survey finds that those with high-deductible plans give their coverage lower ratings overall and are less likely than their counterparts in lower-deductible plans to say they are satisfied not only with their deductible, but also with their copays and premiums.

Financial protection of health insurance

About half (51 percent) of non-group enrollees with ACA-compliant plans say they feel well-protected by their health insurance; however, the share saying they feel vulnerable to high medical bills has risen over the past two years, from 36 percent in 2014 to 45 percent in the current survey. Again, it’s notable that while those with employer coverage are more likely than non-group enrollees with ACA-compliant plans to say they feel well-protected, this group has also seen a similar increase in the share saying they feel vulnerable (from 26 percent in 2014 to 36 percent today).

Half (50 percent) of those with ACA-compliant plans say it is difficult for them to afford the out-of-pocket health care costs not covered by insurance, and a similar share (46 percent) say it’s difficult to afford their monthly premiums (nearly identical to the 45 percent who said so in 2014). A similar percentage (51 percent) says it is difficult for them to afford paying off debt, while a much larger share (71 percent) reports difficulty saving money for retirement, education, and other purposes. Ranking lower in terms of difficulty, a third (33 percent) say they find it difficult to afford basic necessities like food, housing, and utilities.

Not surprisingly, those whose plans have higher deductibles are more likely than those with lower deductibles to say it is difficult for them to afford their out-of-pocket health care costs (58 percent versus 43 percent). This is despite the fact that those with high-deductible plans report higher incomes on average than those whose plans have lower deductibles.

Plan utilization and reported problems

Among those who’ve had ACA-compliant non-group coverage for at least a year, many report having problems with their plans. Most commonly, just over a third (36 percent) say their plan paid less than they expected for a bill, about a quarter (26 percent) say their plan wouldn’t cover or required a very expensive copay for a drug prescribed by their doctor, one in five (21 percent) say they were surprised to find their plan wouldn’t pay anything for care they thought was covered, and a similar share (20 percent) say that a particular doctor they wanted to see wasn’t covered by their plan.

Those who are heavier utilizers of health insurance are more likely than their counterparts to report some of these problems, including their plan paying less than they expected for a bill (47 percent versus 31 percent), their plan not covering a prescription or requiring a very expensive copay (37 percent versus 20 percent). Heavy utilizers are also more likely to report problems paying medical bills in the past 12 months (31 percent versus 16 percent).

In addition to problems with their plans, one in five (20 percent) of those who’ve had ACA-compliant coverage for at least a year say there was a time in the last 12 months when they or another family member covered by their plan needed medical care but did not get it because of the cost. Nearly as many (16 percent) say there was a time in the past year when they did not fill a prescription because of the cost.

Opinions of the Affordable Care Act among those with non-group coverage

As in previous waves of the survey, and as is true among the general population, overall views of the Affordable Care Act among those with non-group coverage are largely divided, with 46 percent saying they have a favorable view of the law and 48 percent unfavorable. Even among this population – whose views one might expect to be divided more on the basis of experience – the biggest differences in opinion are along partisan lines, with 75 percent of Democrats having a favorable view of the law, 79 percent of Republicans expressing an unfavorable view, and independents divided (40 percent favorable, 44 percent unfavorable).

Similar to last year, the largest divide in how people feel the law has impacted them is partisan, with Democrats overwhelmingly feeling they’ve benefited and Republicans overwhelmingly feeling they’ve been negatively affected.

From the Discussion

The share of enrollees who see their plan as a good value has been declining, reflecting growing dissatisfaction with premiums and cost-sharing. Some enrollees who have had their plan for a year or more report expensive drug copays, as well as surprise medical bills and other unexpected expenses they thought their plan covered.

http://kff.org/health-reform/poll-finding/survey-of-non-group-health-insurance-enrollees-wave-3/

Today’s report confirms the growing dissatisfaction with higher premiums and greater cost-sharing of not only ACA-compliant non-group plans but also employer-sponsored group plans as well. The share saying that they feel vulnerable to high medical bills has increased to 45 percent for non-group enrollees and 36 percent for those with employer coverage.

One of the most important functions of health insurance is to provide financial security in the face on medical need. In spite of the Affordable Care Act, that security is deteriorating.

The burden of insurance premiums could be greatly reduced by financing the system through equitable taxes based on the ability to pay. The burden of cost sharing could be greatly reduced by adopting a philosophy of pre-paid health care which has worked well in certain integrated health systems and in the health financing systems of many other nations.

Instead of erecting financial barriers to care, cost containment can be achieved through patient-friendly policies characteristic of a well designed single payer system. Let’s change direction.

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A Canadian expert experiences the U.S. health care system

Posted by on Thursday, May 19, 2016

This entry is from Dr. McCanne's Quote of the Day, a daily health policy update on the single-payer health care reform movement. The QotD is archived on PNHP's website.

Commentary: Single-payer essential to controlling health-care costs

By David Woods
The Philadelphia Inquirer, May 16, 2016

One hears these days mutterings by disaffected Americans that if Donald Trump becomes president, they will pack their bags and leave for Canada. One assumes, of course, that no wall will be built along the border to thwart their exit.

I made the reverse trip. Having emigrated from Britain to Canada, where I became the editor in chief of the Canadian Medical Association Journal, I opted to come to the United States in 1988 for personal reasons.

But I was also taken with American rugged individualism and a health-care system focused on market forces and competition. I wrote articles for the Economist Intelligence Unit and other periodicals on the wonders of the American system. In print, I debated longtime advocates of single-payer national health insurance, extolling the virtues of the health-care market that others abhorred.

Gradually, though, I too began to have doubts about market-driven health care. Over the 25 years that I’ve lived on the U.S. side of the border, I’ve come to the view that the American health-care system – which still leaves 11 percent of the population uninsured, despite the Affordable Care Act – is inferior to the health systems in Canada and the United Kingdom.

One of the ACA’s architects, Dr. Ezekiel Emanuel, describes the U.S. health system as a “terribly complex, blatantly unjust, outrageously expensive, grossly inefficient, error-prone system.” Unfortunately, that’s still true, six years after the ACA’s passage.

The reform didn’t address the fundamental problem in U.S. health care: It’s more about profit than patients.

Controlling health-care costs is essential to the long-term financial health of the United States. A single-payer system would make truly universal coverage affordable, costing no more than we already spend on health care. Of the $3.1 trillion the United States will spend on health care this year, 63 percent is taxpayer-financed, funding Medicare, Medicaid, and Veterans Affairs, along with private coverage for government employees and tax subsidies for employers.

Because of its fragmented, profit-driven system, the United States spends 18.1 percent of gross domestic product on health care, compared with about 8 percent in Britain and 11 percent in Canada. Much of U.S. health spending is simply wasted. For example, 25.3 percent of hospital expenditures go to administrative costs, compared with 12.4 percent in Canada, where there is a single payer in each province and hospitals are mainly funded on a global or lump-sum basis.

Canadians also save money by training a higher percentage of primary-care doctors relative to specialists, negotiating drug prices with pharmaceutical companies, and prohibiting drug companies from advertising directly to consumers. These measures would save Americans billions annually. Americans spend $1,010 per capita on pharmaceuticals; Swedes spend less than half that, according to the Organization for Economic Cooperation and Development. The reason? Sweden doesn’t pay the list price.

Lobbying and influence-peddling by the pharmaceutical and insurance industries keeps the United States from adopting a single-payer health system. Several presidential candidates this season seemed completely under their hypnotic sway. The private insurance industry brazenly tells me, now a U.S. voter, which doctors I can see, charges me astronomical premiums, not to mention co-pays and deductibles, and then wants me to believe that having publicly funded health care that would allow me to go to any doctor in the United States without a $5,000 deductible would be “socialism.”

And don’t believe the widely held U.S. notion that Canadians suffer long waits for care. That’s a canard. We are not going to cut U.S. health spending to Canadian levels. With our much higher level of spending, waits would not be an issue, even with the population aging. Japan and many countries in Europe already have higher percentages of elderly citizens than the graying of the baby boomers is projected to produce.

In his book In Search of the Perfect Health System, British economist Mark Britnell notes that the British love their single-payer National Health Service because of its fairness; it’s available to everyone. He even quotes a former U.K. finance minister who said that the NHS is the closest thing the English have to a religion. Their single-payer system keeps quality indexes up and costs down for the population at large. This enables the British to invest additional funds in education and economic stimulation, areas that also contribute to health and well-being.

The United States should take a lesson from the example of nations with single-payer systems. They offer a measure of hope and optimism that high-quality health care can be the right of all Americans, if they demand it.

David Woods is a former editor in chief of the Canadian Medical Association Journal.


http://www.philly.com/philly/health/20160516_Commentary__Single-payer_essential_to_controlling_health-care_costs.html

This article by David Woods is an important contribution to our efforts to inform our colleagues and the public on the true facts about the single payer model of reform. It is particularly credible since the author is a former editor-in-chief of the Canadian Medical Association Journal who was attracted to the market-driven U.S. health care system, but then, through his personal experiences, recognized its clear inferiority to single payer systems.

Woods concludes, “the example of nations with single-payer systems… offer a measure of hope and optimism that high-quality health care can be the right of all Americans, if they demand it.”

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Adam Gaffney responds to NYT’s Margot Sanger-Katz on cost of single payer

Posted by on Wednesday, May 18, 2016

This entry is from Dr. McCanne's Quote of the Day, a daily health policy update on the single-payer health care reform movement. The QotD is archived on PNHP's website.

A Single-Payer Plan From Bernie Sanders Would Probably Still Be Expensive

By Margot Sanger-Katz
The New York Times, May 16, 2016

Bernie Sanders’s chances at enacting a “political revolution” are all but gone. But that doesn’t mean his policy agenda won’t continue to be felt in this election or future Democratic platforms.

One of his signature proposals is to move the country’s health care system to a government-run, single-payer system.

But also last week, a detailed analysis of the Sanders health care plan from researchers at the Urban Institute showed that it would probably cost the government double what the campaign proposed. It is the second credible analysis to suggest that the Sanders plan costs more than advertised. (The other comes from the Emory health policy professor Kenneth Thorpe.)

The Sanders campaign and its academic allies dispute some of the Urban Institute’s assumptions. A critique of the Urban analysis from David Himmelstein and Steffie Woolhandler, professors of public health at the City University of New York, argues, for example, that drug prices could be pushed even lower. And the Sanders team says that the researchers overestimated the costs associated with administering the government program. But it doesn’t argue that the prices paid to medical providers could be cut more sharply.

http://www.nytimes.com/2016/05/17/upshot/why-single-payer-health-care-would-probably-still-be-expensive.html

***

Blog Post: What’s Wrong with Margot Sanger-Katz’s Single Payer Analysis

By Adam Gaffney
The Progressive Physician, May 17, 2016

Yesterday, New York Times health care reporter Margot Sanger-Katz, whose work I very much respect, entered the debate on the costs of Sanders’ single payer plan in a piece I find problematic, headlined “A Single-Payer Plan From Bernie Sanders Would Probably Still Be Expensive.” I should first concede, however, the central argument of her article: it is true that a US single payer system would still be relatively expensive as compared to other single payer systems. We would, that is to say, continue to spend more than the United Kingdom or Canada if we transitioned to single payer. At the same time, there would nonetheless be enormous savings from such a transition, and these savings would allow us to affordably achieve real universal health care. This, in my opinion, would still be an excellent deal.

The background to this debate are two analyses of the Sanders’ single payer proposal—the first by economist Kenneth Thorpe and the second by the Urban Institute—both of which claimed that the actual costs of Sanders’ single payer plan would be significantly higher than what his campaign has predicted. The assumptions of each have been convincingly contested by colleagues David Himmelstein and Steffie Woolhandler: among other points, they argue that both analyses underestimate administrative savings and overestimate the cost of increased health care use resulting from a coverage expansion.

Anyway, without delving into the details, there is something rather puzzling when looking at the analyses of Thorpe and the Urban Institute from a broader perspective. How is it that single payer would massively increase costs in the United States, as these reports contend, even while countries with single payer-type systems—like Canada and the United Kingdom—have much, much lower health care costs than we do?

To answer, a quick side note: our total health spending is, by definition, equal to the quantity of health services delivered multiplied by their price. The US does not consistently use more health services than other high-income nations. Therefore, the fact that we have higher health care costs is mostly explained by higher unit prices for services, as Sanger-Katz and others note. Now us single payer advocates cite lower administrative costs (and lower drug spending) as the major sources of savings under US single payer (effectively lowering the “price” side of the equation). But Sanger-Katz argues that this would be insufficient: prices would have to be slashed across the board, and some services would have to be cut:

Making the American health care system significantly cheaper would mean more than just cutting the insurance companies out of the game and reducing the high administrative costs of the American system. It would also require paying doctors and nurses substantially lower salaries, using fewer new and high-tech treatments, and probably eliminating some of the perks of American hospital stays, like private patient rooms.

Such a transition would, she notes, have some scary sounding downstream consequences: “…making big cuts all at once to doctors and hospitals could cause substantial disruptions in care. Some hospitals would go out of business. Some doctors would default on their mortgages and student loans.” My understanding is that we aren’t really allowed to effectively default on student loans, but admittedly this all sounds rather dicey.

But this frightful health care meltdown isn’t even in the cards. She is correct in a narrow sense: it’s true that immediately lowering US health care expenditures to, say, that of the United Kingdom — i.e. from 16.4% to 8.5% of gross domestic product — would require major, disruptive reductions in spending across the board. However, nobody is contending that we do that. The central claim for US single payer is more modest. Use the enormous administrative savings generated under single payer financing in combination with pharmaceutical savings to cover everybody with comprehensive benefits and no cost-sharing. Overall national health spending would, it is true, remain roughly the same (though we could better control cost growth moving forward). But this scenario of widespread hospital bankruptcies and the end of private (or semiprivate?) hospital rooms is a fantasy: nobody wants it to happen, and it’s not happening.

It’s worth noting that there is also a jarringly inconsistent aspect to single-payer critiques that warn of the threat to health care workers’ income. As Woolhandler and Himmelstein note in an article in the Huffington Post, the Urban Institute simultaneously asserted that the coverage expansion under single payer would lead to an enormous increase in spending on physician services — by $1.6 trillion over a decade!—while simultaneously asserting that physician salaries would be “squeezed.” Whatever one thinks of how much physicians should be paid, it’s hard how these would both happen at the same time.

Transitioning to single payer will not mean reducing our health care expenses to British levels: that is probably not possible, and is certainly not desirable. But that’s not to say that the savings from adopting a single payer financing system wouldn’t be substantial—we’re talking hundreds of billions annually on administrative savings alone, plus more by reducing drug prices to European levels. With that money, we’ll build a much more decent health care system for all to use without having to worry about the cost of being sick, of being pregnant, or simply of obtaining preventive care. No wonder a majority of the country wants it.

Dr. Adam Gaffney is a clinical and research fellow in pulmonary and critical care medicine at Massachusetts General Hospital. His writing has appeared in the New Republic, Los Angeles Review of Books, USA Today, Salon, CNN.com, Dissent, US News & World Report, Jacobin, In These Times, and elsewhere.

https://theprogressivephysician.net/2016/05/17/blog-post-whats-wrong-with-margot-sanger-katzs-single-payer-analysis/

There have been a multitude of recent media reports indicating that a single payer program, as proposed by Bernie Sanders, would cost much more than previous estimates have shown. These reports rely on recent analyses by the Urban Institute and by Emory Professor Kenneth Thorpe. Unfortunately, these analyses are being given more credibility than the contrasting conclusions of the nation’s two leading experts on single payer – Professors David Himmelstein and Steffie Woolhandler.

NYT’s Margot Sanger-Katz reiterated the conclusion that “the Sanders plan costs more than advertised.” She is highly credible, and, in fact, she did link to an article on the topic by Himmelstein and Woolhandler. But she suggests that prices paid to medical providers must be cut more sharply than proposed, and, by this, seems to accept the fact that Sanders’ single payer proposal is more expensive than anticipated. You may want to read her full article (link above) to better understand Adam Gaffney’s response.

Adam Gaffney’s full blog response is reproduced here, along with the live links, because it is imperative that we not allow the sometimes blind acceptance by the media of the two recent analyses that use dubious assumptions to refute the great body of policy literature that confirms the efficiency and effectiveness of the single payer model. Gaffney sets the record straight.

Study Gaffney’s response and also the prior responses of Himmelstein and Woolhandler (live links in article) so that you will be prepared to refute the claims that single payer is unaffordable. It’s our current highly dysfunctional system that is not affordable.

(Keep in mind that some of the misunderstanding is due to the fact that one view is referring only to federal spending and the taxes to pay for it whereas another view is referring to our total national health expenditures, public and private combined. Obviously transferring private health care spending to the federal government would cause federal spending and taxes to increase – the claim being made – but total spending under a well designed single payer system would remain about the same, with administrative and price savings being used for expanded benefits and coverage.)

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Gallup: Majority support federally funded health care system

Posted by on Tuesday, May 17, 2016

This entry is from Dr. McCanne's Quote of the Day, a daily health policy update on the single-payer health care reform movement. The QotD is archived on PNHP's website.

Majority in U.S. Support Idea of Fed-Funded Healthcare System

By Frank Newport
Gallup, May 16, 2016

Presented with three separate scenarios for the future of the Affordable Care Act (ACA), 58% of U.S. adults favor the idea of replacing the law with a federally funded healthcare system that provides insurance for all Americans. At the same time, Americans are split on the idea of maintaining the ACA as it is, with 48% in favor and 49% opposed. The slight majority, 51%, favor repealing the act.

The results show that many Americans are OK with several ways of handling the ACA rather than favoring only one possibility. In particular, 35% of all Americans say they would favor keeping the ACA in place and separately say they favor the idea of replacing it with a federally funded universal health insurance system. Among Democrats and Democratic leaners, 59% favor both of these approaches. In short, many Americans would apparently go along with Clinton’s idea of keeping the ACA in place as it is now, or with Sanders’ bolder proposal to replace it with a Medicare-for-All system.

Gallup also asked those who favor either keeping the ACA in place or replacing it with a federally funded system to choose between these two options. The federally funded system wins among this group by a 2-to-1 ratio, 64% to 32%, meaning this system garners the most support among the initial favor/oppose questions and wins when those who like both approaches are forced to choose.

Additionally, 27% of Americans say they favor repealing the ACA and say they favor replacing it with a federally funded system. This means the group of Americans in this survey who favor the law’s repeal, a core policy proposal of many Republican presidential candidates during this campaign season, includes some who apparently want the ACA repealed to replace it with an even more liberal system. Only 22% of Americans say they want the ACA repealed and do not favor replacing it with a federally funded system.

The breakdown of reactions to these proposals by partisanship shows the expected patterns: Democrats and Democratic-leaning independents are highly likely to favor the two options put forth by the Democratic candidates, while Republicans and Republican leaners are highly likely to favor Trump’s position, repeal of the ACA.

One notable exception to the strong partisan skew in reactions to these proposals comes from Republicans when they are asked about replacing the ACA with a federally funded system. Forty-one percent of Republicans favor the proposal — much higher than the 16% who favor keeping the ACA in place. This may reflect either that Republicans genuinely think a single-payer system would be good for the country, or that they view any proposal to replace the ACA (“Obamacare”) as better than keeping it in place.

Bottom Line

Americans express considerable support for the idea of replacing the ACA with a federally run national healthcare system, which is similar to the proposal championed by presidential candidate Sanders. To be sure, many Americans, primarily Democrats, also favor the idea of just keeping the ACA in place. But given a choice, those who favor both proposals come down on the side of the Sanders-type proposal. Four in 10 Republicans also favor the idea of a federally funded system.

http://www.gallup.com/poll/191504/majority-support-idea-fed-funded-healthcare-system.aspx

Although this new Gallup poll has been widely interpreted in the media as showing strong national support for single payer reform, the actual question was about favoring or opposing “Replacing the ACA with a federally funded healthcare program providing insurance for all Americans,” and it was asked with two other options (repealing ACA, keeping ACA in place), any or all of which could be chosen. Replacing ACA with federally funded health care was supported by 58%, repeal ACA by 51%, and keeping ACA by 48%.

Perhaps one of the more important findings in this poll was that 27% of Americans favor both repealing ACA and replacing it with a federally funded system. Since 45% of all Americans support repeal of ACA, this means that over half of those favoring repeal want it replaced with a federally funded system. That gives a new slant to the repeal and replace clarion call of the Republicans.

In fact, 41% of Republicans favor replacing ACA with a federally funded system whereas only 16% of them prefer to keep ACA in place.

Based on this poll, it is no wonder that the May 16 headline in The Washington Post read, “Poll: Most Americans want to replace Obamacare with single-payer — including many Republicans.”

When those who favor either keeping the ACA in place or replacing it with a federally funded system were asked to choose between the two, 32% favored keeping ACA and 64% favored replacing it with a federally funded system.

This should reinvigorate those of us who are working so hard to bring to America the health care system that we need and want – a single payer improved Medicare for all.

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sdrawkcab reform

Posted by on Monday, May 16, 2016

This entry is from Dr. McCanne's Quote of the Day, a daily health policy update on the single-payer health care reform movement. The QotD is archived on PNHP's website.

Sorry, We Don’t Take Obamacare

By Elisabeth Rosenthal
The New York Times, May 14, 2016

Amy Moses and her circle of self-employed small-business owners were supporters of President Obama and the Affordable Care Act. They bought policies on the newly created New York State exchange. But when they called doctors and hospitals in Manhattan to schedule appointments, they were dismayed to be turned away again and again with a common refrain: “We don’t take Obamacare,” the umbrella epithet for the hundreds of plans offered through the president’s signature health legislation.

“Anyone who is on these plans knows it’s a two-tiered system,” said Ms. Moses, describing the emotional sting of those words to a successful entrepreneur.

The goal of the Affordable Care Act, which took effect in 2013, was to provide insurance to tens of millions of uninsured or under-insured Americans, through online state and federal marketplaces offering an array of policies. By many measures, the law has been a success: The number of uninsured Americans has dropped by about half, with 20 million more people gaining coverage.

Yet even as many beneficiaries acknowledge that they might not have insurance today without the law, there remains a strong undercurrent of discontent. Though their insurance cards look the same as everyone else’s — with names like Liberty and Freedom from insurers like Anthem or United Health — the plans are often very different from those provided to most Americans by their employers. Many say they feel as if they have become second-class patients.

Some early studies of the impact of the Affordable Care Act plans are proving patients’ grumbling justified: Compared with the insurance that companies offer their employees, plans provide less coverage away from patients’ home states, require higher patient outlays for medicines and include a more limited number of doctors and hospitals, referred to as a narrow network policy. And while employers tend to offer their workers at least one plan that allows them coverage to visit doctors not in their network, patients buying insurance through A.C.A. exchanges in some states do not have that option, even if they’re willing to pay higher premiums.

The research thus far suggests that the differences between plans offered through the A.C.A. and those offered by employers may be quite significant. A study in the policy journal Health Affairs found that out-of-pocket prescription costs were twice as high in a typical silver plan — the most popular choice — as they were in the average employer offering. In research conducted with the Robert Wood Johnson Foundation, Dr. Polsky found that 41 percent of silver plans offered a “narrow or very narrow” selection of doctors, meaning at best 25 percent of physicians in an area were included. The consulting firm Avalere Health found that exchange plans had 42 percent fewer cancer and cardiac specialists, compared with employer-provided coverage.

When designing the new plans, for-profit insurers naturally tended to exclude high-cost, high-end hospitals with whom they had little clout to negotiate discounts. That means, for example, that as of late last year none of the plans available in New York had Memorial Sloan Kettering Cancer Center in their network — an absence that would be unacceptable to many New York-based employers buying policies for their employees.

And when Simon F. Haeder of the University of Wisconsin and his colleagues studied the plans sold on the California exchange, they found that they included 34 percent fewer hospitals than those sold on the open market and tended to exclude the priciest medical centers, like Cedars Sinai, a highly regarded hospital that runs the largest heart-transplant program in the country.

http://www.nytimes.com/2016/05/15/sunday-review/sorry-we-dont-take-obamacare.html

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Special Enrollment Periods for the Health Insurance Marketplace

CMS.gov, May 6, 2016

Special Enrollment Periods

While SEPs provide a critical pathway to coverage for qualified individuals who experience qualifying events and need to enroll in or change qualified health plans (QHPs) outside of the annual open enrollment period, it’s equally important to avoid SEPs being misused or abused.  As it announced today, HHS is tightening the rules for certain special enrollment periods and making clear that SEPs are only available in six defined and limited types of circumstances.

An Interim Final Rule with Comment (IFC) published in the Federal Register provides that individuals requesting a “permanent move” SEP must have minimum essential coverage for one or more days in the 60 days preceding the permanent move, unless they were living outside of the United States or in a United State territory prior to the permanent move. This ensures that individuals are not moving for the sole purpose of obtaining health coverage outside of the open enrollment period.

https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2016-Fact-sheets-items/2016-05-06.html

When explaining that health care reform seems to be moving backwards, does it improve communication to discuss reform that is sdrawkcab (ananym of backwards)?

NYT’s Elisabeth Rosenthal has provided us with another great article that describes how some of the supposedly forward advances in reform are really backwards. The ACA exchange plans are undoing some of the financial protection that health insurance should afford us, while impairing access through narrower provider networks. If we said that this reform is sdrawkcab, would that help us understand it better?

As small business owner Amy Moses stated, “Anyone who is on these plans knows it’s a two-tiered system.” Does it not seem absurd that the policies inherent in ACA would place a business owner in the lower tier of a two-tiered system? Isn’t that sdrawkcab? Yes and no. Actually what is sdrawkcab is that we would even have tiers in our health care system when it would be much more efficient, more equitable, and more effective to have a single high level system for everyone – an improved Medicare for all.

A specific example of the wrong direction in which too much of our policy is headed is provided by the new CMS rule that describes yet another technical reason to prohibit individuals from obtaining coverage through special enrollment periods. Although health reform supposedly was designed to expand access to insurance plans, this rule is sdrawkcab in that it prohibits access for certain uninsured individuals. True, the rule was designed to protect insurers from individuals who might have an acute need for coverage outside of the open enrollment period, but the entire system should have been designed to automatically enroll everyone instead of ignoring individual needs while providing insurers with their optimal business model.

No more sdrawkcab reform. Everybody in, nobody out!

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Republicans planning further privatization of Medicare

Posted by on Friday, May 13, 2016

This entry is from Dr. McCanne's Quote of the Day, a daily health policy update on the single-payer health care reform movement. The QotD is archived on PNHP's website.

GOP closing in on ObamaCare alternative, lawmakers say

By Peter Sullivan and Sarah Ferris
The Hill, May 12, 2016

House Republicans huddled behind closed doors on Thursday to discuss their plan to replace ObamaCare, which they said is on track to be released in June.

The proposal will include a version of Speaker Paul Ryan’s (R-Wis.) long-standing proposal to make Medicare more market-based, giving seniors a kind of voucher to use for private insurance, according to two Republican lawmakers who attended the meeting.

“It’s turning out to be more encompassing than what we expected,” Rep. John Fleming (R-La.) said after the meeting. “Now we’re actually adding in Medicare and the premium support, the things that Paul Ryan’s been talking about for years.”

Ryan was an “active participant” during Thursday’s meeting, said Rep. John Kline (R-Minn.).

“We want to help provide the policy issues, where if [Trump’s] elected, we can go forward,” Ryan said, according to Energy and Commerce Committee Chairman Fred Upton (R-Mich.).

http://www.thehill.com/policy/healthcare/279755-gop-closes-in-on-obamacare-alternative

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House GOP Mulling Medicare Age Changes and Taxation on Premiums

By Mary Ellen McIntire and Caitlin Owens
Morning Consult, May 12, 2016

The details of House Republicans’ plan to replace Obamacare are beginning to emerge. Members seemed pleased with what they heard after a closed-door caucus meeting Thursday afternoon at which the leaders of the effort presented their ideas.

Many of the ideas presented at the meeting are consistent with conservative proposals previously floated by House Speaker Paul Ryan (R-Wis.).

Earlier on Thursday, Ryan met with Donald Trump, the presumptive GOP presidential nominee. Ryan loosely tied the afternoon policy meeting to his earlier meeting with Trump, according to Upton.

Medicare changes discussed at the meeting included enhancing Medicare Advantage, the private alternative to traditional fee-for-service Medicare, and raising the Medicare eligibility age.

https://morningconsult.com/2016/05/house-gop-mulling-medicare-age-changes-taxation-premiums/

***

Blog: Trump adviser now says Medicare and Medicaid changes are on the table

By Harris Meyer
Modern Healthcare, May 12, 2016

On Wednesday, Sam Clovis, Trump’s chief policy adviser, signaled to a Washington group that strongly favors a major overhaul of Medicare, Medicaid and Social Security that Trump is open to their agenda. “After the (Trump) administration has been in place, then we will start to take a look at all of the programs, including entitlement programs like Social Security and Medicare,” Clovis said, according to the Wall Street Journal.

http://www.modernhealthcare.com/article/20160512/blog/160519947

For those of you who were dubious about the claim in yesterday’s Quote of the Day comment that Medicare is well on its way toward privatization, today’s report should provide additional fodder for your consideration.

The House Republicans will soon release a white paper describing the policies they recommend for replacing the Affordable Care Act. A few details have been released following their closed-door caucus meeting yesterday – a meeting attended by House Speaker Paul Ryan. Ryan’s presence is important because, when he agreed to accept the Speakership, it was on the condition that he would have a leading role in shaping the conservative Republican agenda.

We now know that they do intend to introduce premium support to the Medicare program – a voucher-like system that would enable Medicare beneficiaries to purchase private health insurance plans perhaps comparable to the current Medicare Advantage plans.

Furthermore, in spite of exposure of the nefarious plot to overpay the private Medicare Advantage plans in order to entice beneficiaries into the private plans, the Republicans intend to further enhance the Medicare Advantage plans to attract even more Medicare beneficiaries – making the private plans the preferred choice because of the extra benefits they can offer. Once a critical mass is enrolled in the private plans, they can start to disassemble the then deficient, neglected, antiquated traditional Medicare program.

The fact that they intend to increase the age for Medicare eligibility indicates that they are not really interested in the welfare of the Medicare population. The purpose of premium support is to reduce the government contribution so that more of the costs are shifted to the beneficiaries through higher premiums, through greater deductibles and other cost sharing, and through reduced benefits and reduced access through narrower provider networks.

Can they actually accomplish this? Although far more people vote for Democrats than Republicans in the House elections, the Congressional district borders are controlled predominantly by Republican state governments. This gerrymandering of the districts will ensure that Republicans will maintain control of the House even with a minority of votes. Ryan’s agenda will prevail in the House deliberations.

If Republicans maintain control of the Senate and if a Republican is elected as President, Senate Majority Leader Mitch McConnell surely will be tempted to use the “nuclear option” – changing the rules so that the Democratic minority would be less able to block legislation, such as the Medicare privatization proposals.

Donald Trump’s popularity in the Republican primaries and caucuses was certainly not predicted. It is very possible that the voters may choose him for President, perceiving him as an outsider who will get things done as opposed to an establishment insider whose popularity has been declining.

Although Trump has said that he would protect Medicare, Sam Clovis, his chief policy advisor, said yesterday, “we will start to take a look at all of the programs, including entitlement programs like Social Security and Medicare.” Also Trump is holding meetings with Paul Ryan wherein Ryan’s clear intent is to unify the party by convincing Trump to support Ryan’s agenda. After his meeting with Trump yesterday, Ryan promoted premium support to his caucus.

If will be difficult to campaign for Medicare for All if Medicare becomes a despised program in which private insurers take away our health care choices and force us into debt. The threat is very real.

Yesterday’s Quote of the Day on overpayments to Medicare Advantage

http://www.pnhp.org/news/2016/may/cms-not-fulfilling-obligation-to-recover-medicare-advantage-overpayments

PNHP is a single issue organization, promoting education and research for the single payer model of health care reform. We do not support nor oppose any political parties or candidates. (Today’s message should be perceived as a plea to all politicians, not just Republicans, to protect and support Medicare.)

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CMS not fulfilling obligation to recover Medicare Advantage overpayments

Posted by on Thursday, May 12, 2016

This entry is from Dr. McCanne's Quote of the Day, a daily health policy update on the single-payer health care reform movement. The QotD is archived on PNHP's website.

Auditors: feds failed to rein in billions in over-billing by Medicare Advantage

By Fred Schulte
The Center for Public Integrity, May 9, 2016

Private Medicare Advantage plans treating the elderly have over-billed the government by billions of dollars, but rarely been forced to repay the money or face other consequences for their actions, according to a new Congressional audit.

In a sharply critical report made public Monday, the Government Accountability Office called for “fundamental improvements” to curb overbilling by the health plans, which are paid more than $160 billion annually.

GAO took aim at Medicare’s primary tactic for recouping overcharges, a secretive, and lengthy, audit process called Risk Adjustment Data Validation, or RADV. Unlike many other anti-fraud programs, RADV has cost the government way more than it has returned to the treasury.

The GAO said that the Centers for Medicare and Medicaid Services, an arm of the Department of Health and Human Services, has spent about $117 million on these audits, but so far has recouped just $14 million.

The GAO launched its audit in October 2014 in the wake of the Center for Public Integrity’s “Medicare Advantage Money Grab” series.

The Center’s investigation traced the overpayments to abuse of a billing formula called a risk score, which pays higher rates for sicker patients and less for people in good health. Since 2004, however, the risk score formula has largely operated as an honor system, despite criticism that many health plans have overstated how sick some patients are to boost their revenues. That practice is known in medical circles as “upcoding.”

Medicare officials have quietly conducted these audits since 2008. But they have never imposed stiff financial penalties even as evidence built up that billing errors were deeply rooted and wasting tax dollars at an alarming clip.

GAO in its report noted that CMS has failed to target health plans with “known improper payment risk,” thus allowing the worst performers to escape the net.

GAO reviewers said that CMS is stepping up the RADV audits, but added that much more needs to be done. GAO noted that officials expect the upcoming audits to recover $370 million, but that’s just three percent of the total estimated annual overpayment.

https://www.publicintegrity.org/2016/05/09/19660/auditors-feds-failed-rein-billions-over-billing-medicare-advantage

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Report to the Chairman, Committee on Ways and Means, House of Representatives

Medicare Advantage: Fundamental Improvements Needed in CMS’s Effort to Recover Substantial Amounts of Improper Payments

Government Accountability Office, April 2016

Conclusions

Limitations in CMS’s processes for selecting contracts for audit, in the timeliness of CMS’s audit and appeal processes, and in the agency’s plans for using MA RACs to assist in identifying improper payments hinder the accomplishment of its contract-level RADV audit goals: to conduct annual contract-level audits and recover improper payments. These limitations are also inconsistent with federal internal control standards and established project management principles. Our analyses of these processes and plans suggest that CMS will likely recover a small portion of the billions of dollars in MA improper payments that occur every year. Shortcomings in CMS’s MA contract selection methodology may result in audits that are not focused on the contracts most likely to be disproportionately responsible for improper payments. Furthermore, CMS’s RADV time frames are so long that they may hamper the agency’s efforts to conduct audits annually, collect extrapolated payments efficiently, and use audit results to inform future RADV contract selection. By CMS’s own estimates, conducting annual contract-level audits would potentially allow CMS to recover hundreds of millions of dollars more in improper payments each year. Agency officials have expressed concerns about the intensive agency resources required to conduct contract-level RADV audits. To address the resource requirements of conducting contract-level audits, CMS intends to leverage the MA RACs for this purpose; however, the agency has not outlined how it plans to incorporate RACs into the contract-level RADV audits and is in the early stages of soliciting industry comment regarding how to do so.

http://www.gao.gov/assets/680/676441.pdf

***

Medicare Advantage 2016 Spotlight: Enrollment Market Update

By Gretchen Jacobson, Giselle Casillas, Anthony Damico, Tricia Neuman and Marsha Gold
Kaiser Family Foundation, May 11, 2016

The number and share of Medicare beneficiaries enrolled in Medicare Advantage has steadily climbed over the past decade, and this trend in enrollment growth is continuing in 2016. The growth in enrollment has occurred despite reductions in payments to plans enacted by the Affordable Care Act of 2010 (ACA).

Almost one in three people on Medicare (31% or 17.6 million beneficiaries) is enrolled in a Medicare Advantage plan in 2016.

http://kff.org/medicare/issue-brief/medicare-advantage-2016-spotlight-enrollment-market-update/

Today’s message provides yet one more example of CMS’s complicity in the privatization of Medicare. What does that mean and why does it matter?

Medicare Advantage (MA) plans are private health insurance plans that Medicare enrollees can select in place of the traditional Medicare program. The purpose was ideologically driven – to get the government out of Medicare.

Congress originally established the private plan option through the Medicare + Choice program. They believed the promise of the private insurers that they could provide higher quality care at a lower cost. That failed and insurers withdrew simply because it costs considerably more to finance health care through private insurers than through our public Medicare program. Congress went back to the drawing boards and established the Medicare Advantage program in which the private insurers were paid about fourteen percent more than the public program was paying for comparable patients.

Thus the private MA plans were able to attract patients by offering them supplemental benefits and lower out-of-pocket cost sharing. They also successfully marketed to a healthier, lower cost population – being paid more while spending less. To counter this “favorable selection,” risk adjustment was introduced in which the insurers would be paid more if they enrolled sicker patients. The insurers quickly learned how to upcode to qualify for payments greater than the health status of their enrollees warranted.

When Congress created the Affordable Care Act it was recognized that the overpayments needed to be pared back, especially since the insurers were rewarding themselves with favorable selection and upcoding. Thus ACA required that the overpayments be reduced gradually, and that process has now been completed.

But what happened? Each year CMS has found offsets to the required payment reductions – offsets that were generous enough to actually result in increased payments in each year that reductions should have occurred.

And what about the upcoding that was used to qualify for unearned risk adjustments? The Government Accountability Office (GAO) has shown that CMS has failed to recapture the overpayments even though the problem was well recognized and theoretically a process was in place to do so. After pressure from the GAO and from the investigative reporting of The Center for Public Integrity, CMS is going to step up its efforts at recovery. However, these renewed efforts are expected to recover only about three percent of the overpayments. The insurers get to keep their illicit overpayments, with the complicity of CMS.

Kaiser (KFF) has just released a report showing that the nefarious plot to transfer patients to the private MA plans is working. Enrollment has steadily climbed over the past decade. If Congress and CMS can keep up this subterfuge then very soon Congress can begin to reduce funding for the traditional Medicare program which will cause more providers to drop out. That will then create a public demand for the overpaid private MA plans. Congress can then enact their premium support (voucher) program for private Medicare Advantage plans, and then follow through by emasculating the traditional program (“drown it in a bathtub”).

Once everyone is in a privatized Medicare voucher program, Congress can ratchet down the value of the voucher. This will complete their goal of bringing us consumer-directed health care – placing patients in charge of controlling health care costs through price sensitivity necessitated by high deductibles and other cost sharing, whether or not they have health savings accounts. This, of course, will lead to financial hardship and forgone health care.

If you think that our government would never do this to us, keep in mind that the process is well underway. Today Speaker Paul “Premium Support” Ryan met with likely presidential-nominee Donald Trump to set the agenda for our nation’s future.

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