By Philip Caper, M.D.

Dr. Margaret Flowers of Maryland, one of our nation’s most prominent advocates for single-payer health reform, visited Maine May 9-11. Her two-and-a-half day visit was sponsored by Maine AllCare, the Maine chapter of PNHP, and was prompted by the May 10 unveiling of her portrait and that of longtime PNHP national coordinator Dr. Quentin Young, painted by Maine artist and social activist Rob Shetterly as part of his series “Americans Who Tell The Truth.”

The unveiling was held at the Portland Public Library, and was kicked off by Portland Mayor Michael Brennan. The event was co-sponsored by 21 additional Maine organizations, and was attended by about 125 people from around the state.

Margaret’s visit started Wednesday evening when she attended Occupy Maine’s general assembly and potluck supper. Thursday began with a radio interview of Margaret by former Green Party vice-presidential candidate Pat La Marche on WZON-AM’s “The Pulse Morning Show.” Margaret then gave pediatric grand rounds at the Maine Medical Center, followed by a meeting with Portland Press Herald editorial writer Greg Kasich. She then conducted a “lunch and learn” session with about 100 medical students at the University of New England in Biddeford. Following the luncheon session, Margaret was interviewed for Public Access TV for southern Maine.

These events were followed by a rally in Portland’s Monument Square attended by 60 or so Occupy Maine and labor activists, the portrait unveiling with an address by Dr. Flowers (a video of Margaret’s remarks is available here) and a dinner with Maine AllCare board members and invited guests.

Friday started off with a panel discussion held at the headquarters of the Maine Medical Association which was co-sponsored by Maine AllCare and the Maine Health Policy Study Group, a group of Maine physicians interested in health policy. The panel, titled “Beyond Patient Care: The Role of Physicians in Health Care Policy,” comprised four physicians, one a member of the Legislature. The panel discussion was attended by around 25 physicians — and one lobbyist from Johnson and Johnson. It was recorded in full (as was the rally and unveiling the previous night) by Patty Wight, a reporter from the statewide Maine Public Broadcasting Network. Margaret and I were interviewed by Patty following the panel. Patty’s coverage resulted in a nice segment on MPBN Friday evening.

Margaret then recorded a video interview for Rob Shetterly who explained why he selected her and Dr. Young for his “Americans Who Tell The Truth” series (Americanswhotellthetruth.org).

Following that, Margaret, Rob Shetterly and I video-recorded a roundtable discussion conducted by Garrett Martin, CEO of the Maine Center for Economic Policy (one of the sponsors of the unveiling), that will be repeated six times in the next two weeks, and carried on Time-Warner cable. It is estimated to reach 300,000 Maine households.

Margaret and I then stopped by the Lewiston Sun-Journal for a briefing of their editor and health care reporter before she caught her flight out to Detroit.

Quite a couple of days. I think we made an impression. There is more information about the visit on our website www.maineallcare.org.

By Samuel Metz, M.D.

From April 26-28, Oregon Physicians for a National Health Program and the Mad as Hell Doctors hosted a visit to our state by Drs. Marcia Angell and Arnold Relman, past editors of the New England Journal of Medicine.

The initial set of events took place in Portland, as this 2-page flyer illustrates. First was the Thursday Oregon Health and Science University presentation, organized primarily by Richard Bruno (OHSU medical student and winner of the Student Activist award at the national PNHP convention this year) with assistance from other members of the OHSU medical student PNHP chapter. The 150-seat auditorium was filled with students, residents, physicians, nurses, and administrators; it had standing room only.

Drs. Angell and Relman then had a brief meeting with Oregon Gov. John Kitzhaber, M.D., in which they discussed health care innovations in Oregon. The governor was urged to consider a single-payer program for Oregon.

The Thursday afternoon event at Legacy Good Samaritan Hospital was similarly well attended, with about 80 people packed into a small conference room. Dr. Stephen Jones, chair of internal medicine at Legacy Health Systems, was principally responsible. He was also a co-moderator on Friday’s panels.

Dr. Relman and Dr. Angell, past editors, New England Journal of Medicine.

The Friday morning panel, which included the participation of Cathy Schoen of the Commonwealth Fund and Dr. Bruce Goldberg, director of the Oregon Health Authority, was attended by 85 people, mostly non-physicians and non-single-payer types simply interested in learning about reform. The summary by Amanda Waldroupe of the Lund Report, titled “Panel on Health Reform Focuses on Ditching the Insurance Industry,” is accurate.

The evening panel was attended by 45 people, many of whom had not attended the morning session. Both crowds were enthusiastic.

The Saturday single-payer rally at the Majestic Theatre in Corvallis had 200-250 attendees. Many were from Eugene, Salem, and Portland. This event was organized primarily by Dr. Mike Huntington of Corvallis PNHP and MAHD, and Betty Johnson, a longtime single-payer advocate from Mid-Valley Health Care Advocates. Mike and Betty are now key participants in the newly reorganized Health Care for All Oregon.

The Saturday evening fund-raising dinner was held at my house. Thirty-five people attended and listened in rapt attention to Drs. Angell and Relman, the brief presentations from each and then a long discussion period. Most were senior physicians. Others included a county judge, the head of the port of Portland, and the president of the Oregon State Council for Retired Citizens. Valuable connections were made by the PNHP and MAHD representatives.

Dr. Marcia Angell addresses the audience.

Important results of these events, especially the Friday panels, included raising awareness among non-activist businesspeople of the critical nature of health care reform and the legitimacy of a single-payer option. For many, this was the first time single payer was discussed in a credible, nonpartisan environment.

Another valuable result was the relationship built between the organizers of these events and a variety of organizations new to single payer. These included all organizations listed on the flyer as sponsors or distributers of publicity, plus a few added after the flyer was created: The Oregon Business Council, multiple neighborhood business organizations, professional organizations for realtors, Project Access Now, and several smaller charitable organizations.

Finally, flyers were sent to each of Oregon’s 90 state legislators. Most did not reply, though a few sent regrets; but in a few cases contact was made with legislative aides, contacts valuable when the Legislature considers its next single-payer bill.

One reason so many organizations collaborated in sending out flyers was, I suspect, that nothing in the Friday panel advertising materials explicitly mentioned single payer. While each of the panel participants and moderators understood the value of single payer (and several are strident advocates), few attendees were aware of this beforehand. This permitted many neutral people to hear about single payer without their attendance showing visible support for the concept.

My lessons from this experience:

* “If you’ve got what people want, it’s easy to sell.” In this case, many people drawn to the Thursday and Friday presentations knew Drs. Angell and Relman only as distinguished senior academic physicians. Every medical organization was happy to lend a hand, as were organizations with experience in health policy (the Foundation for Medical Excellence, the Northwest Health Foundation, We Can Do Better). Featuring recognizable names helped our cause.

* We were fortunate to include Dr. Bruce Goldberg, widely respected as a calm, rational, nonpartisan advocate for Oregon’s health care needs. While he did not speak about single payer himself, his presence on stage with single-payer advocates lent great prestige to the program and enormous credibility to other panelists who did.

* The efforts to contact a large sample of business organizations provided value in itself. I now know more about who is doing what and who represents whom than I did before. My contact list includes many helpful executive directors and program administrators, now on a first name basis with me. When MAHD and PNHP plan their next event, many doors will open graciously for us.

* The Saturday rally was the only event designed and billed as a single-payer rally. This served an important need to reward, recharge, and motivate the current advocate population. In addition to the outreach to the unconverted of the previous two days, this solidified the visit of Drs. Angell and Relman. In the course of three days, our guests spoke to the choir, the pews, and a lot of people just passing by.

What would we plan for Drs. Angell and Relman during their next visit? Meetings with the editorial boards of the three largest newspapers in Oregon. Individual and group meetings with legislators and legislative caucuses. Guest appearances at physician organizations, notably the Oregon Medical Association and the Medical Society of Metropolitan Portland, both of which were happy to send flyers for the Thursday and Friday events. By the way, our guests have not ruled out another visit in a few months.

Delivery Matters: the high costs of for-profit health services in Alberta

By Diana Gibson
Parkland Institute, April 2012

In Alberta and across Canada, the private for-profit healthcare sector is being positioned as a solution to wait times and the financial challenges facing the health care system. Consequently, for-profit delivery of healthcare is increasing.

(T)his report explores the delivery of clinical services, specifically arthroplasty or total hip and knee replacements, through private, for-profit clinics. It includes a case study of Calgary’s Health Resource Centre (HRC) that specifically examines the cost, quality, access and other implications of expanding this form of provision and places it in the context of national and international research. (The Health Resource Centre, based in Calgary and owned by Networc Health Inc., was Alberta’s flagship private surgical facility until it went bankrupt in 2010.) It also examines a wait-list reduction pilot project, the Alberta Hip and Knee Replacement Project, which includes for-profit and not-for-profit providers, allowing for a comparison of the two models.

The Alberta Hip and Knee Replacement Project

In 2004 the provincial government initiated a pilot project to address a myriad of challenges within the arthroplasty field. One of the key elements of this pilot project was to address wait times as directed by the Premier’s Advisory Council on Health and its Framework for Reform. A partnership was carved out between Alberta Health – which contributed $20 million in funding – three regional health authorities (and their clinical partners including HRC), the Alberta Orthopedic Society, the Alberta Bone and Joint Institute and physicians from across the province.

The trial illustrated that with improved management practices (such as centralized intake and assessment), realignment of resources, and collaboration and cooperation across the delivery path, costs can be reduced, wait times can be decreased and benefits to patients enhanced within the public, not-for-profit system. Specifically, the trial reduced overall wait times from family doctor through to surgery by 90 per cent (from 19 months to approximately 11 weeks).

Risks and Opportunities of HRC

The surgeries were more expensive, but came with significant risk in other areas as well: the dependency between the parties became detrimental to both; the relationship created expensive duplication of capital and lack of control over infrastructure planning; and the private contract meant a serious lack of accountability and transparency. Additional risks identified in international studies include lower quality of services and poorer articulation with the broader health community.

Comparing For-Profit to Non-Profit

The Alberta government acknowledged that the for-profit surgeries would cost more but justified this with the wait-time reductions were worth the cost. The examination of the performance of HRC in contrast with the public non-profit elements of the pilot project helps to illuminate the wait-list issue. The analysis above reveals that the public partners in the Alberta Hip and Knee pilot are still working well, with wait-time advances at lower cost than the HRC and without the risks.

The wait-list reduction achievements of this project were attained despite, not because of, for-profit involvement in the trial. It was the specialized or focused nature of the clinic, not the investor-owned nature, which increased patient access and enabled innovation. This is consistent with international evidence from Canada and abroad demonstrating that wait lists are actually lengthened as a result of the existence of for-profit entities delivering clinical health care services.

What advocates of for-profit delivery suggest is that the removal of patients from the public queue will shorten the queue. What they fail to note is that the removal of health professionals from the public delivery system will slow down the system and result in the queue growing even longer.

The Alberta Hip and Knee pilot project demonstrates the capacity of the public health system to evolve and innovate in such a way that costs are maximized, wait lists are reduced, and patient outcomes are improved. The pilot set the stage for province-wide learning and provided a platform for a revolution in hip and knee surgical practices. Gains from the pilot continue to be made through the Transformational Improvement Program (TIP), which specifically addresses wait lists. Results to date show improvements in length of stay at almost every site, as well as gains in other key indicators of quality such as patient satisfaction and early mobilization after surgery. The rewards are substantial. They include higher volumes of surgeries as more bed days become available, greater satisfaction as patients move more quickly from referral to surgery, and reinvestment of the efficiency savings in ways that can further improve care quality and safety. Our public health system is more than able to meet the needs of our citizens when the political will exists and resources are allocated.

Conclusion

It matters who delivers clinical services. The spectacular fall from grace of HRC is a fascinating study in the ills of health care privatization, the risks to patient care, and the need to reiterate the importance of our publicly financed and delivered health care system. The case study of HRC is very consistent with international studies, validating the conclusion that for-profit incursions into the health care system are risky, costly and lack the accountability Canadians expect, demand and deserve.

The success of the public partners in the pilot project on wait-time reductions in Alberta clearly shows that public solutions can achieve the same wait-list targets at less cost and much less risk to the public.

http://parklandinstitute.ca/downloads/reports/HRC-Report.pdf

And…

Neat, Plausible, and Wrong: The Myth of Health Care Unsustainability

Canadian Doctors for Medicare
February 2011

Which Costs Are Rising?

While the cost of Medicare has not grown as a percent of GDP over the last 35 years, there have been significant increases in total health care system costs over the same period, and those increases have accelerated in the last decade. Overall health spending in Canada has risen from about 7% of GDP in 1975 to about 10.7% in 2008. In 2010, heath care spending was estimated to be about 12% of GDP.

If Medicare costs are stable, and public sector costs are rising slowly, why are total health care costs increasing rapidly? The real cost driver is precisely the thing that critics of Medicare tout as the solution: private health care.

Currently 30% of all health care spending is in the private sector, up from 24% in 1975. That growth is the result of significant increases in costs in the private health care sector, including out-of-pocket spending and the costs of private insurance.

http://www.canadiandoctorsformedicare.ca/images/stories/Neat_Plausible_and_Wrong.pdf

In spite of the overwhelming body of evidence to the contrary we still hear over and over again that the private sector always produces higher quality at lower costs – whether in health care financing through private insurers, or in health care delivery through investor-owned facilities. Canada has provided us with yet another real-life experiment that confirms, once again, that the opposite is true.

The Alberta government understood that private care would cost more than in the public sector, but they agreed to it in an effort to reduce wait times. However, not only did the private sector provide care at higher costs, they had intruded into the loosely-integrated public system, creating the potential of increasing wait times in the public sector (explained above).

Fortunately, with a coordinated effort to attack this problem – coordination that only happens in the public sector – Alberta was able to reduce its wait times for orthopedic procedures from 19 months down to 11 weeks – in spite of, rather than due to, involvement of the private sector.

Also, quite ironic but very instructive, not only did care cost more when delivered by the private, for-profit Health Resource Centre, the extra costs were not enough and the business model failed – ending in bankruptcy.

In health care financing and delivery, public and non-profit institutions can always provide greater value and efficiency than the for-profit private sector, but it requires a government that is supportive of their public financing system.

In 2005, Conservative Premier Ralph Klein of Alberta wrote in the Calgary Herald, “Let me be blunt. We have unacceptable waiting lists in our publicly funded, rationed health-care system, and all the money in the world is not going to eliminate them… In simple terms it means that if you are in pain or suffering and cannot wait in line, you should be able to buy the health care you need.”

The Calgary Herald published my response which stated, “Ralph Klein states that ‘all the money in the world’ is not going to eliminate waiting lists, unless the source of the funds is private instead of public. What nonsense. Excessive queues are eliminated by making minor, selective adjustments in the system’s capacity. Responsible stewards of any health-care system, public or private, will make these adjustments. The difference is the public system would be adapted to accommodate everyone, whereas private systems accommodate only those who can pay.”

Of course, Alberta didn’t listen to me and continued on with its efforts to privatize. However, they did involve the public sector in queue reduction, with considerable success. But by including the private sector, the experiment was much more expensive, and resulted in further losses through the HRC bankruptcy.

Although these reports are about Canada’s Medicare system, the conclusions could apply to our Medicare as well, if we expanded it into a single payer national health program. It would be less expensive and more effective than what we have, provided we also elect stewards who believe in and support public systems.

Sunday night’s CNN special narrated by journalist Fareed Zakaria titled “Global Lessons — The GPS Road Map for Saving Heath Care” was interesting and initially promising, but ultimately disappointing.

It started out with superb references to other countries, then became illogical and gutless. In the end, the “solutions” offered by Zakaria to cure our broken health care system didn’t flow from the evidence presented earlier in the program. Remarkably, the U.S. implications of successful single-payer models were ignored.

Zakaria started out with a reasonable report on Britain’s single-payer National Health Service: its good quality, universal access and low cost. He also gave a fair account of the evidence-based, evaluative work of the National Institute for Health and Clinical Excellence, NICE (which is being undermined now, something he failed to mention).

He interjected a few comments about long wait times in Britain for non-urgent care, and raised the bogey of high taxes as the price one has to pay for such a system. But on balance the account was generally favorable.

Taiwan’s adoption of single-payer national health insurance was treated next. Zakaria noted that with Taiwan’s shift to a single-payer system in 1995, the proportion of the country’s uninsured dropped from 41 percent to 8 percent within a year. He also described other positive aspects of the Taiwanese health system. Overall, this segment was quite favorable and accurate.

Then came Switzerland. Here he gave a reasonable report about the country’s system of highly regulated private insurers (who can’t profit from selling basic health insurance policies and must offer insurance to all comers). He was incorrect, however, in equating the Swiss reform with the Affordable Care Act in the U.S.

Then the logical connections fell apart.

Zakaria proceeded directly to a segment on “consumer-driven care,” interviewing a corporate CEO who recently wrote in praise of free-market medicine in The Atlantic. Here Zakaria at least pointed out that there’s no evidence that a free-market approach will control costs, saying that the only evidence of competition working is for elective procedures like Lasik surgery, whereas most health care costs arise unpredictably or stem from chronic disease.

He then looked at ACOs, accountable care organizations, in the form of an uncritical interview with Dr. Atul Gawande, the surgeon and writer for The New Yorker. Gawande emphasized how uncoordinated and excessive care contribute importantly to our nation’s high health care costs.  Zakaria noted that there are ACO experiments, but failed to emphasize the lack of evidence that we can scale up ACOs.

Next was also an uncritical, indeed quite favorable, report on efforts in Camden, N.J., to provide case management care for high utilizers in “hot spots.” Zakaria glossed over the lack of solid evaluation data on the Camden experiment.

In his wrap-up, Zakaria offered his own views. He endorsed individual mandates (noting that they were first proposed by the Heritage Foundation). He said the ACA won’t control costs, and said we need a “cost control board” to decide what’s covered and what isn’t.

He explicitly rejected a pure market solution as inappropriate to health care, noting we’re not buying cars, we’re buying something for which we have little choice when it’s needed. The pure market solution won’t control costs and will leave many without care, he said.

Inexplicably, Zakaria failed to point out the implications for the U.S. of the successful British and Taiwan experiences, and instead said that we need to “acknowledge what’s on the ground” in the U.S. (read: path dependence), and thus need to fix the current “messy mixed model” we currently have.

As I said at the beginning: promising opening, but ultimately disappointing in acceptance of our current structurally defective health care financing system. Viewers deserve a more coherent and brave progression from evidence to action.

Dr. James G. Kahn is a professor at the Philip R. Lee Institute for Health Policy Studies at the University of California, San Francisco. Dr. Kahn is an expert in policy modeling in health care, cost-effectiveness analysis, evidence-based medicine, and administrative costs in U.S. health care. He is also a board member and immediate past president of Physicians for a National Health Program – California.

Orszag: Defined Contributions Define Health-Care Future

By Peter Orszag
Bloomberg, December 6, 2011

Over the next decade, we are likely to see a shift in health insurance in the U.S.: So-called defined-contribution plans will gradually take over the market, shifting the residual risk of incurring high health-care costs from employers to workers.

The market today is dominated by “defined-benefit” plans, under which companies determine a set of health-insurance benefits that are provided for employees. These will gradually be replaced by defined-contribution plans, under which companies pay a fixed amount, and employees use the money to buy or help pay for insurance they choose themselves.

The fundamental driver of this shift is the effort by American businesses to reduce their exposure to health-care costs. But the recent health-care-reform law may accelerate the shift.

The change in health insurance is already well under way in coverage for retirees. In the early 1990s, in response to accounting changes and rising costs, companies began to re- evaluate retiree health plans, and some capped the amount they were willing to pay at a multiple of existing costs. Over time, as those limits were reached, most companies declined to raise them, thereby effectively creating defined-contribution retiree health-insurance plans, with the company’s contribution set by the cap. Exchanges have been created to allow retirees to use these employer contributions to purchase their own health insurance.

For current workers, the precursor to a defined- contribution approach is the “consumer-driven” health plan. This typically has higher deductibles and co-payments than a traditional plan has, and it is often tied to a health savings account. It typically still provides generous insurance for catastrophic cases.

Some insurers are already anticipating the shift. Bloom Health Corp. will begin offering defined-contribution exchanges in 2012. Bloom, based in Minneapolis describes itself as “a leader in the defined-contribution health benefits marketplace,” and says it is “committed to assisting employers of all sizes move toward an employer-sponsored system that has effective cost predictability for employers and increased choice and personalization for employees.” In September, the company announced that Health Care Service Corp., Blue Cross Blue Shield of Michigan and WellPoint (WLP) Inc. had purchased a majority of its equity.

The inevitable transition to defined-contribution health insurance may get a little push from the new health-care-reform law. Indeed, the legislation may have a larger impact on the type of health-insurance plan that employers offer than on their decision about whether to drop health-care benefits altogether.

If most employers do retain their health plans, the state insurance exchanges created under the new federal health-care law will make the basic idea of a defined-contribution health plan more prevalent, and thus may speed its adoption. The regulations written to carry out the new law will determine how things play out. If defined-contribution plans that are sufficiently generous count as employer-based coverage – as is generally expected – the trend toward such plans will probably accelerate.

In any case, the bottom line is that a shift toward defined-contribution plans seems likely. I’d be willing to bet $1 that most large U.S. employer health-care offerings in 2020 will be defined-contribution plans. Any takers?

(Peter Orszag is vice chairman of global banking at Citigroup Inc. and a former director of the Office of Management and Budget in the Obama administration. The opinions expressed are his own.)

http://www.bloomberg.com/news/2011-12-07/defined-contributions-define-health-care-ahead-commentary-by-peter-orszag.html

One of the more important tools to enable the transfer wealth up the income ladder is to shift from defined benefit programs to defined contributions. With a defined contribution, a set dollar amount is contributed to the program regardless of what the future benefits may cost, whereas with a defined benefit program, the projected costs of the program must be fully funded so the benefits will always be there when needed.

In the case of pension plans, a defined contribution allows the employer to shift the risk of wage inflation and the risk of living longer from the employer to the employee. The latter is particularly a problem since many individuals will outlive the funds accumulated in their defined contribution pension plan. It is true that they could use those funds to buy an annuity, but fewer funds would be available because it is not a defined benefit plan, and converting to an annuity burns up even more of the retirement funds to pay for sales and administrative costs plus the costs of insuring against the risk of living longer.

How does this move wealth up the income ladder? Defined benefit pension plans were considered to be a standard part of the well-earned employee benefit package. These defined benefit plans were actually paid for by foregone wage increases. In the last couple of decades, contributions to the pension plans were limited by changing to defined contribution, yet wages remained flat. The foregone wages never came back. Workers suffered a net loss, while employer/owners kept the difference, thus an upward transfer of wealth.

Now we are seeing this same inequitable concept being applied to employer-sponsored health plans. Traditional health plans provided generous benefits and often had an actuarial value of 90 percent (the plan paid 90 percent of health care costs and the worker paid 10 percent). We are now seeing a decline in actuarial value. The most obvious contributing factor is the relatively abrupt increase in the adoption of high-deductibles for employer-sponsored plans, but also benefits covered are diminishing, often through less transparent, innovative changes to the plans. Once again, benefits are being reduced but without a commensurate return of forgone wages.

Particularly alarming in Peter Orszag’s article is the investment of WellPoint and Blue Cross Blue Shield of Michigan in Bloom Health Corporation. Bloom Health is “a leader in the defined-contribution health benefits marketplace.” They are committed to a system that has “effective cost predictability for employers,” but exposes employees to the ever higher costs and risks of health care.

This ongoing shift to defined contribution in health care is not limited to businesses. In a recent message, we reported that the Institute of Medicine is recommending that the essential health benefits for the state insurance exchanges under the Affordable Care Act “should be defined as a package that will fall under a predefined cost target rather than building a package and then finding out what it would cost.” “Predefined cost target” is a defined contribution.

Even Medicare is vulnerable. The New York Times, in a recent editorial, stated that for Medicare, “serious analysis and testing of premium support are clearly worth pursuing.” Premium support is a defined contribution that would be used to purchase a private Medicare plan. Medicare beneficiaries would be responsible for paying for the balance of the premium for whatever coverage they could get. Further, with tight control of the defined contribution, an increasing percentage of health care costs would be shifted to Medicare patients in the form of higher out-of-pocket spending.

What do all of these have in common? They are all methods of perpetuating the private insurance industry, while shifting risks from the insurers to the insured individuals. They reduce the financial commitment of employers and the government, but increase the financial burden for workers, their families, and retirees – most of us. However, it is a jobs program – for personal bankruptcy attorneys, as if our health care system didn’t give them enough work already.

Defined contribution is a nefarious conspiracy directed at the masses to benefit the well off. We can counter by demanding an end to a system dominated by private insurers and replacing it with a single, publicly-financed and publicly-administered national health program – an improved Medicare for everyone.

(After we fix Medicare, we may want to think about greatly reinforcing our publicly-financed, publicly-administered, defined benefit Social Security program so we wouldn’t have to put up with the abuses of our private, defined contribution pension plans. Really.)

Medicare Advantage Premiums To Fall 4% Next Year

By Phil Galewitz
Kaiser Health News, September 15, 2011

The Obama administration on Thursday said the nearly 12 million senior citizens enrolled in Medicare health plans will see their monthly premiums drop by an average of 4 percent while benefits remain stable next year.

Enrollment in the plans, which now have about a quarter of all Medicare beneficiaries, is expected to grow by 10 percent in 2012, said Jonathan Blum, deputy administrator for the Centers for Medicare and Medicaid Services.

He attributed the premium drop to the agency’s strong negotiations with plans as well as the companies’ continuing desire to serve the market.

Dan Mendelson, the chief executive of consulting firm Avalere Health, said plans are lowering premiums because their costs have fallen as their members have used fewer services in the midst of the economic downturn.

The plans were targeted by Democrats who complained that the government pays more per capita for beneficiaries in the private plans than it spends on those in traditional Medicare.

Federal payments were frozen to Medicare Advantage plans this year and are dropping by less than 1 percent in 2012.

The health care law softens the impact of Medicare Advantage cuts in 2012 by providing billions of dollars for quality bonuses for highly rated plans that received four or five stars in a government grading system.

In a policy shift last fall, HHS decided to lower the bar for bonuses. Average-quality plans garnering just three or three-and-a-half stars would also get bonuses, although at a lower percentage than top-tier plans.

The HHS decision means that nearly 90 percent of Medicare Advantage enrollees are in plans now eligible for a bonus. Under the tougher approach Congress took in the health law, only about 33 percent would have been in plans getting the extra payments.

http://www.kaiserhealthnews.org/Stories/2011/September/15/medicare-advantage-premiums-fall-next-year.aspx

The Obama administration is countering Republican claims that the Affordable Care Act stole money from Medicare. They are trumpeting the facts that Medicare Advantage premiums are 4 percent lower, and enrollment is expected to be up by 10 percent. We really need to get past the deceptive rhetoric on both sides to understand what really is going on.

The Medicare Advantage program began as a fraud. These private plans were paid 113 percent of the costs of the traditional Medicare program so that they could offer extra benefits to entice individuals away from the public program. Once a sufficient number of individuals joined the private plans, funding for the public program would be slashed and patients would flee into the private plans. Only then would the public learn that the next planned step would be to shift to a Ryan-type voucher (premium support), which would dump much more of the costs onto patients.

The Affordable Care Act included a provision to gradually reduce these Medicare Advantage overpayments. The scheduled reduction for 2012 will be less than 1 percent. But members of the Obama administration have been listening to the insurers and the Republicans. They decided that this very modest reduction might make them more vulnerable to Republican attacks as we enter an election year. So what did they do?

They replenished the reductions with billions of dollars in quality bonuses designed for top tier 4 and 5 star plans, but they expanded the program to include 3 star plans. That way, plans covering 90 percent of Medicare Advantage enrollees would receive additional payments. A quality bonus for almost every plan is nothing more than a blanket payment increase. They have preserved this gift to the private insurers and then have the gall to claim that the programs are stronger and more popular as a result of their “strong negotiations” with the plans! Strength in politics seems to be proportional to the size of the gifts of cash, especially appalling when you realize that this is our tax money.

By the way, how much is that 4 percent reduction in premiums that the Medicare Advantage enrollees will be paying? It averages about $1.48 monthly per enrollee. That tough negotiating sure hit the insurers hard. $1.48! I can picture the insurers leaving the negotiations saying that they sure were hit hard this year, but they hope to do better in next year’s negotiations, as they collapse in hysterics right after the door closes.

One more important fact to keep in mind is that these extra insurance company bonuses are paid partly by our Part B premiums in the traditional Medicare program. Those of us who refuse to join the Medicare Advantage plans are paying higher premiums to buy more patient benefits, more insurer profits and more administrative services for those who have enrolled in the private plans. We now have an official government policy that requires us to pay more and get less if we don’t privatize ourselves!

Dishonesty is so prevalent in politics today that I think I almost understand the graffiti that we saw yesterday while hiking on our ridge trail: “The truth is a lie!”

The following is the prepared text of the testimony given by Dr. Garrett Adams, president of Physicians for a National Health Program, at a Capitol Hill hearing on the topic of “Is poverty a death sentence?” The hearing was conducted by Sen. Bernie Sanders, chair of the Subcommittee on Primary Health and Aging of the U.S. Senate Committee on Health, Education, Labor and Pensions, on Sept. 13 in Washington.

To watch a video of Dr. Adams delivering his testimony, visit the subcommittee’s website and drag the time marker to 49:00. The relevant segment is 7 minutes long.

Others testifying at the two-part hearing included Dr. Sarah Kemble of Massachusetts and Dr. Paula Braveman of California. Their testimony can also be found at the same link.

Sen. Sanders’ report on poverty is available in PDF format here. It was issued on the same day that the U.S. Census Bureau reported that the number of people living in poverty in the United States had increased to 46.2 million, the highest number in the 52 years the bureau has been tracking it. The same report showed that the number of uninsured had climbed to 49.9 million people, which is the highest figure since the passage of Medicare and Medicaid.

Is poverty a death sentence?

Senator Sanders, Senator Paul, members of the Committee,

I am very grateful to Senator Sanders for his sensitivity to the grave health threats that a large portion of the American population currently suffers because of poverty. He does a wonderful service to these people by giving them a voice to our leaders, so that you can better understand the perilous health care situation so many Americans find themselves in because of their poverty.

I dedicate this testimony to all those Americans for whom poverty is, has been, or will be a death sentence. And also to those Americans for whom illness is a poverty sentence.

According to a recent Harvard study, 45,000 Americans die every year because of lack of health insurance, a stark figure. The late Surgeon General Julius Richmond, however, reminds us that “Statistics are people with the tears wiped dry.”

Today I will tell you about some of those people whom I know or have known, all of whom failed or are failing to get necessary life-saving health care because of financial constraints – most impoverished; others not yet impoverished, but who died waiting for approval by a health insurance company of an expensive life-saving procedure that never came or came too late. The first cases I describe are Kentuckians.

Kentucky

David Velten, Louisville. 32 years old. School bus driver. Wife, two young sons. Chronic liver failure. I met David in June 2006. He was initially denied a liver transplant by his insurance company, but due to public pressure, the company relented and allowed it. But it was too late. He died in 2007 several months after the transplant.

Cheryl Brawner, Louisville. 50 years old. Legal secretary, avid bicyclist, friend. Acute leukemia. Advised at Fred Hutchinson Hospital in Seattle to have a bone marrow transplant. Was in remission awaiting approval from the insurance company for the transplant. She waited and waited and waited. Cheryl relapsed and died of her leukemia while waiting for approval.

Clay Morgan, Henry County. Automobile mechanic, owned his own business. Malignant melanoma. Received treatment, improved, thought to be cured, but now was bankrupted. His cancer returned. Depressed and unwilling to bring more medical debt on his family, Clay went into the back yard and took his own life.

Velinda Anderson, “Help Needed for Medicine,” Oak Street, Louisville, Kentucky, March 2011.

Velinda Anderson, Louisville. She was employed. Velinda had had endarterectomy (removal of artery blockage) in her legs, but could not afford the expensive medicine, Plavix, prescribed to keep her arteries open. She had left her usual neighborhood to beg, so that she would not be seen begging by friends. She had not told her daughter that she was doing it.

Grundy County, Tennessee

Grundy County is the poorest county in Tennessee, 95th out of 95. The median household income is $25,619. Sixty-six per cent of school children qualify for free lunch. Nineteen percent of the population is illiterate. Correspondingly, it has the lowest county rank in overall health. The ratio of population to primary care provider is 7,122 to 1, compared to the national ratio of 631 to 1.

Beersheba Springs is on the Cumberland Plateau in Grundy County – Appalachia. We have a vacation home there. In the early winter of 2008, Josephine, an 87-year-old friend, stopped by. She was holding her red, swollen face and was bent over in pain. She had an acute sinusitis that required quick, aggressive treatment. I urged her to get to a doctor immediately. She bounced around several places, but eventually got treated. However, her bill was over $2,000, money she didn’t have, and she did not have Medicare. I decided to establish a free medical clinic for my mountain friends in Beersheba Springs. The Beersheba Springs Medical Clinic, an all-volunteer, not-for-profit clinic opened in November 2010 (www.beershebaclinic.org).

Charlotte Dykes. 64 years old, works odd jobs when able; husband is a carpenter. Peripheral vascular disease. Past history of obstructed mesenteric artery (main artery to intestines) with stent placement in Chattanooga. This spring we diagnosed severe blockage of her right subclavian artery and a 70 percent carotid artery blockage. Surgeon refuses to operate unless she pays up front, because she still has not paid her bill from her previous surgery. Charlotte is a walking time bomb. She will be 65 in December, when she will be eligible for Medicare, if she lives that long. In giving permission for me to tell her story, Charlotte said to me, “You speak out for me.”

Charlene. 54 years old. We saw her in May. She had not seen a doctor in over 20 years. We diagnosed an acute myocardial infarction (heart attack). She was air-lifted to Nashville, treated and discharged, but did not fill her discharge prescriptions (including Plavix – see Velinda Anderson) and did not go to cardiac rehab as directed, because she could not afford either. She is doing very poorly and has a recent dementia, probably due to small strokes.

Doris. 58 years old. She and her husband operated a small local restaurant before her illness forced them to close the restaurant. Estimated annual income: $12,948. Came to our clinic because of a lump in her breast. She had heard we offered mammograms. We diagnosed breast cancer. Because she had breast cancer, she was able to get TennCare to pay for her mastectomy and treatment, but the coverage is only for the cancer treatment.

Billy Campbell. 54 years old. Work: Tree farming and carpentry. Estimated income in 2009: $12,000; 2010: $17,000. No health insurance. Colon cancer, Stage 3. Oncologist recommends PET scan. Hospital refuses to allow it because he cannot pay the $1,500 fee. TennCare denied payment. Disability denied three times. Barbecue benefit to raise money for Billy’s PET scan was last Friday night, Sept. 10, 2011.

Paula. 32 years old. Cervical cancer surgery two years ago. No follow-up, because of no insurance and no money. We arranged for specialist care at no charge.

Bob. Double hernias. Surgeon agreed to fix for $500, but hospital charge will be $8,000. He can’t afford it. His hernias will not be fixed.

Woman with broken arm. 64 years old. No insurance. I saw this woman about three weeks ago. She had a crooked left forearm and limped. She had fallen in March, breaking her left arm and her left leg. She went to a hospital emergency room where she was seen by an orthopedic surgeon, who recommended surgery to properly fix her arm. The surgeon agreed to do it in spite of the lack of insurance, but the hospital refused to allow use of the operating room since she couldn’t pay.

Woman with blood sugar >500 mg percent. The normal value is around 100 mg percent. Hers was a life-threatening level of hyperglycemia. We sent her to a hospital emergency room. She knew she had diabetes. She owned a glucometer, but could not afford the strips to test her blood sugar.

Thank you for this opportunity to speak for those without a voice, who have died or will die as a result of our country’s unwillingness to acknowledge that health care is a human right and to provide affordable, high-quality health care to every resident.

Confidentiality note. All patients with first and last names have given me permission to tell their story. Charlene, Doris, Paula, and Bob are fictitious names. All Grundy County patients, except for Billy Campbell, were seen in the Beersheba Springs Medical Clinic.

Garrett Adams, M.D., M.P.H.

A PDF of Dr. Adams’ testimony is available from the Senate subcommittee.

Originally posted on Medicine and Social Justice blog, Aug. 31, 2011

During the health reform debate, one option we were assured was never seriously “on the table” was “single payer,” or Medicare for All. President Obama, who as a senator had indicated his support for this solution, backed away from it as fast as he could. In this he was undoubtedly encouraged by his many advisors, who have also encouraged bank bailouts, “compromise” on the debt ceiling, etc. (see June 18, 2009,“No Single Payer”: Sebelius – making policy for the powerful).  This is not to say that there were not supporters of single payer within government; there were and are. HR 676, “The Improved and Expanded Medicare for All” act, principally sponsored by Rep. John Conyers of Michigan, had nearly 100 co-sponsors in the House. Sen. Bernard Sanders of Vermont introduced a single-payer bill  in the Senate. Vermont, in fact, has become the first state to move toward a form of single payer on a statewide basis.

As anyone who has been reading this blog for any amount of time knows, I am a strong advocate of single payer. (A few of the many MSJ references: April 28, 2011 Perception and reality of economic inequality; July 22, 2010, Improving quality and access still requires coverage for all;  April 10, 2009, Does the nation need a clear policy on a right to basic health care?).

My reasons for support of single payer are several:

1. It covers everyone. No one is left out. There is no complex system of “these people get coverage this way, those people get coverage that way, and those people (too bad) are left out altogether.”
2. It provides a uniform benefit package. Everyone can get the care that they need, without concern about whether they are covered. In our current system, even many people who are insured have inadequate coverage. In addition, to the extent that the society decides to limit access to unproven or detrimental (see #5 below) or even “too expensive” care, no one gets it.
3. It saves money. Off the top, it saves the profit being taken out of the system by insurance companies and other for-profit businesses. It saves even more money by eliminating all that being spent by those companies to deny care claims and by providers of care to try to get paid (see A Modest Proposal: Bribe the Insurance Companies, August 23, 2009).
4. It puts us all in it together. This is a core method of ensuring social justice. The more educated and empowered among us will work to make sure that they get good care, and this benefits everyone.
5. It provides the basis for ensuring quality, by having a degree of control over what gets reimbursed, and therefore what gets done. It may not ensure quality by itself, but it is almost a necessary component.

In 1964, President Johnson signed the Medicare Bill in Independence, MO, giving cards #1 and #2 to former President Harry Truman, who had fought for national health insurance in the late 1940s and lost, and his wife Bess.Forty-seven years later, Medicare has proven its importance in providing a single-payer program for seniors. It is the largest payer in the country, and the rates that it pays for services determine those paid by other insurers. While expanding Medicare to everyone should be the centerpiece of health policy, it has instead become the target of proposals to cut coverage to those who already receive it, particularly from the right. This has led to a lot of bad ideas from politicians such as Rep. Paul Ryan and Sen. Joseph Lieberman (see Medicare: We need to expand it, not cut it!, July 1, 2011).

The “poster child” for a single-payer system is Canada, which has had it since the early 1970s. Based on the principle of social solidarity, not often apparent in the US, the Canadian federal government set the criteria for the program (which is also called “Medicare”) and the individual provinces set the specific terms and fund it. There is local (provincial) autonomy within the boundaries established by the federal government (see December 14, 2009, Tommy Douglas and the Canadian Health System;  May 27, 2010, Universal Coverage and Primary Care: The US needs both). Several recent articles have addressed the degree to which changes in the primary care system to create “medical homes” in Ontario, Canada’s largest province, have enhanced the quality of patient care, access of patients, lowered cost, and increased the income of primary care physicians (see Rosser et al, “Progress of Ontario’s Family Health Team model: a patient-centered medical home” [1] ). It is critical to note that this Family Health Team program was really only possible on such a scale because Ontario, like the rest of the country, has a single-payer system.

The importance of increasing, or at least not decreasing, the income of primary care physicians relative to other specialist, has been addressed in several other posts. What about all physicians, as a group? The AMA and other physician groups were, after all, largely responsible for the defeat of Truman’s national health insurance program and were major opponents of the US Medicare and Medicaid programs. Surveys by Physicians for a National Health Program (PNHP, see especially “Single Payer National Health Insurance”) have shown increasing support for single payer among the physician community, with universal health coverage being supported by a majority of US doctors in 20 (Support for national health insurance among US physicians: 5 years later[2]).

A new study may help to persuade physicians that single-payer systems are actually in their financial interest. Writing in August 2011 in Health Affairs, Morra and colleagues report that “US Physician Practices Versus Canadians: Spending Nearly Four Times As Much Money Interacting With Payers”[3] (hyperlink to abstract). The title basically says it all. While both Canadian and US physicians spent time (translated into money!) interacting with insurers, the single payer in Canada and hundreds of payers in the US, about patient benefits and payment, the staff of US physicians spent 10 times the amount of time in such activities as did their Canadian counterparts. The authors estimate the cost to US physicians at $82,975 per physician per year, nearly 4 times the $22,205 cost to Ontario physicians. In addition, these costs fall disproportionately highly on small physician practices, which are more likely to be primary care. They conclude that “If US physicians had administrative costs similar to those of Ontario physicians, the total savings would be approximately $27.6 billion per year.”

From a financial point of view, we have an apparent dilemma in the US. The cost of Medicare is very high and creates financial threats to the economy. The reimbursement from Medicare to providers is often too low to make them a desirable payer. But there is a solution. It involves getting control over costs. First, do not pay for harmful or questionable interventions, do not pay major markups to generate excessive profit for private companies, and use the large scale of government purchasing to get good prices for drugs, unlike the boondoggle of Medicare Part D, the prescription drug program in which Medicare pays retail prices to pharmaceutical companies.

The solution is also to emphasize more primary care and prevention (October 18, 2010 Lower Costs in Grand Junction: More Primary Care, Less High Tech). The next steps will be harder, for they will involve making difficult decisions about the cost/benefit ratios of different types of care, particularly as the availability of new, expensive, high-tech interventions provide allure, if not always results.

The way not to do this is for policies restricting access for a part of the population (working and poor people) to be made by another part of the population (big businesses, politicians, and lobbyists) who will not be affected by those decisions. A single-payer system in which we are all covered by the same benefits does not automatically save money, but at least makes it possible.

[1] Rosser WW et al, “Progress of Ontario’s Family Health Team model: a patient-centered medical home”, Ann Fam Med. 2011 Mar-Apr;9(2):165-71.

[2] Carroll A, Ackerman R “Support for national health insurance among US physicians: 5 years later” Ann Int Med 1Apr2008;148(7):566-7.

[3] Morra D, et al, “US Physician Practices Versus Canadians: Spending Nearly Four Times As Much Money Interacting With Payers”,Health Affairs August 2011 vol. 30 no. 8 1443-1450.

Re ‘Managed Competition for Medicare? Sobering Lessons from the Netherlands,’ by Kieke, Okma, Marmor and Oberlander (NEJM, June 15):

The fundamental flaw in much of the market rhetoric we hear is that health care is not an ordinary product and will never be regulated by market forces.

You can’t exit the market when you are very ill – you buy or die. The doctor not the patient orders the tests and treatments.

The search for information about symptoms is why you go to the doctor. Even a good doctor is sometimes unsure of a patient’s diagnosis or what the long-term costs will be until after some very expensive tests are done.

We have all heard about people with chest pain who were cured with five dollars worth of Maalox and those who needed $100,000 worth of open heart surgery. Americans already face high out-of-pocket costs and it has not controlled health care costs or insurance premiums.

If you are in agony from a ruptured appendix are you going to haggle with the surgeon over his fee on the way to the operating room? The most complex and costly services are the least negotiable.

If open heart surgery was on sale would you have two? The most expensive services are necessary but not really desired like a new car or a Rolex.

Most economists recognize that health care is not a normal product and not subject to the usual market forces. When there is market failure (and health care is a classic example), then the second best solution, regulation, is needed.

The health care systems wit the best outcomes for the least cost are all highly regulated or socialized. (See the Commonwealth Fund data on this fact.) Even here in the U.S. the best quality at reasonably low cost is being turned out by the VA, a completely socialized system.

We already have a national health insurance system that works for the sick elderly and disabled called Medicare. Medicare spends only 3 percent on insurance overhead vs. private insurance which regularly spends 20 percent or more. We should improve and expand Medicare to all. Multiple studies by solid health economists suggest that we could save over $400 billion by the simplicity of this system. This is enough to cover all the uninsured and improve coverage for all the rest of us.

As noted by the authors of this paper, an unanticipated outcome of the Dutch competition was increased cost due to complexity.

Every year around the Fourth of July, amid the flag waving and fireworks, I come across an article or two blaming patriotism for the ills of civilization. I agree with much of the criticism. A constant obsession with being “the best in the world” makes us both arrogant and unrealistic. Believing we can be truly healthy—economically, environmentally, or otherwise—without considering the roles and needs of other nations is not only immature but dangerous.

As I often do when confronted with a loaded word, I looked up “patriot” in my old Merriam Webster dictionary. I was struck right away by the short, simple definition: “love for or devotion to one’s country.” I’m sure you know it came originally from the Latin for father, pater. Interesting, since the earth parent is usually a maternal one. The paternal face of country has more to do with the political structure, historically a masculine creation, than the land itself.

What if we imagined our country, in both earthy and political nature, as a parent? I don’t mean to invoke the over-protective helicopter version. I’m talking about our formation as persons—the various influences that eventually make us who we will be. And how about our reciprocal duty to our parents, as they age and sometimes need us to care for them? Could we consider how we are serving in that role to our nation, now well over 200 years old?

I’ve worried sometimes, while advocating strenuously for Medicare for All (including visitors and immigrants), that I’m taking a sort of parochial view. It seems a little selfish to spend so much effort lobbying for my fellow country-people, when much of the world fares far worse in life expectancy. I wonder if I should be doing something more globally relevant instead.

But all this thinking about land and politics, fathers and mothers, and caring for one another took me in an unexpected direction. We aren’t patriotic enough. If we were more patriotic (loving, devoted), and followed the principle of loving other (countries) as ourselves, maybe we’d do better. There’s no need to hold back our love for this land, its history or its people. We don’t have to be blind about it either. In fact, we owe a special duty to address the errors of those we love. I have a deep love for my state, Alabama, despite its sometimes recalcitrant and difficult ways. It’s ok to love a city, a certain neighborhood, a particular tree. We can all start where we are, then extend ourselves outwards, as in the spiritual practice of lovingkindness meditation.

Let’s love our country more. Tell Congress we want to pay for our nation’s healthcare and not be forced to give protection money to private insurers. With the savings, we will be in better condition to bring resources to those other (also beloved) lands in need. We don’t have to limit the borders of our patriotism. Everybody in. Nobody out.

http://pippaabston.wordpress.com/2011/07/06/medical-patriotism/