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.
An Open Letter To Trump: The GOP Health Plan Won’t Work, Replace ACA With Single Payer
The Huffington Post, March 9, 2017
Dear Mr. President,
You vowed to replace the Patient Protection and Affordable Care Act (ACA) with something great that would provide Americans with universal coverage and lower deductibles and copayments. As leaders of Physicians for a National Health Program (PNHP), a nonpartisan organization of 20,000 physicians and medical students, and as a business leader who desires fundamental health reform, we request an opportunity to meet with you to explain why single-payer, Medicare for all, is a great solution that will meet your stated goals.
Health care reform is urgently needed. Seven years after the passage of the ACA, 26 million Americans remain uninsured, tens of millions more are underinsured, and health care costs – already twice as high as the average of other wealthy nations – continue to rise. In a recent survey, Americans were more likely to report financial barriers to health care than citizens of any of the 11 other nations surveyed. One-third of Americans, including 43 percent of low-income persons, went without health care due to cost last year.
Unfortunately, “The American Health Care Act” (AHCA) would be a big step in the wrong direction. The bill would shrink Medicaid benefits for millions of poor and low-income families. It would sharply reduce the value of government subsidies, leaving millions of near poor and middle income Americans unable to afford coverage, and shifting millions of others to the kind of bare bones plans that you have decried. Meanwhile, it would give hundreds of billions of dollars of tax breaks to the wealthiest 2 percent of Americans, and reward insurance firms that pay outrageously high executive salaries.
In sum, this legislation will degrade already inadequate coverage, increasing financial barriers to care and endangering tens of thousands of lives, merely to reduce taxes on rich individuals and corporations.
The working people of America are looking to you for something better.
In contrast, a single-payer system, essentially an expanded and upgraded version of traditional Medicare, could meet your stated goals of more coverage, better benefits and lower costs. Such reform would drastically cut insurance overhead and the paperwork insurers inflict on doctors and hospitals, saving more than $500 billion annually. Those savings would cover the cost of universal, first-dollar coverage – including dental services and long-term care – upgrading coverage for the vast majority of Americans.
And a single-payer reform would allow the U.S. to use proven-effective tools to control costs. Instead of disrupting the delivery of care by shoehorning every doctor and hospital into a gigantic corporation, it would support practices and hospitals of all sizes with negotiated fees and global budgets. Negotiating prices with drug firms as other countries do would save another $150 billion annually. Controlling costs is the only way to make our health care system sustainable for future generations.
Single payer would lift the burden of health benefit costs from employers, making U.S. business more competitive. Richard Master, a business owner in Pennsylvania, produced the film “Fix It” to explain the benefits of single payer to business. Adopting a single-payer system would help keep jobs in the U.S.
Legislation for “improved Medicare for all,” H.R. 676, was introduced in the Congress last month by Rep. John Conyers. Polls have shown that 58 percent of Americans favor replacing the ACA with a single-payer system, as do 59 percent of physicians, 81 percent of Democrats, and a rapidly growing share of Republicans.
Single payer has proven effective in countries around the world, as evidenced by experience in Canada and Scotland, which spend far less than we do, cover everyone, and provide care free at the point of delivery. Tommy Douglas, the founder of Canada’s system, is ranked the most popular figure in that nation’s history, and Sen. Bernie Sanders attracted a huge following with his support for single payer, Medicare for all in his run for the Democratic primary.
PNHP has, from the outset, been strongly critical of the ACA’s failure to solve our nation’s health care crisis. The AHCA would divert us even further from the goal of solving that crisis and tarnish your legacy. Single-payer reform is the only solution.
Steffie Woolhandler, M.D., M.P.H., Co-founder PNHP
David Himmelstein, M.D., Co-founder, PNHP
Carol Paris, M.D., President, PNHP
Don McCanne, M.D., Senior Health Policy Fellow, PNHP
Adam Gaffney, M.D., Board member, PNHP
Janine Petito, Medical student board member, PNHP
Richard Master, Chairman & CEO, MCS Industries, Inc.
President Trump was not well informed on health policy when he took office. He has been too busy with other things. He did know that serious problems persisted in spite of Obamacare – too many uninsured, insurance plans that left people with excess medical debt, too many had impaired access to the health care they needed, and health care costs were too high. So he promised that Obamacare would be repealed and replaced with a really terrific plan – “insurance for everybody… much less expensive and much better.”
He is surrounded by advisors who have given him lessons on health policy, but, unfortunately, all the wrong lessons. He now understands that health reform is very complicated, so he left it to his advisors and Congress to provide the details. They are currently trying to pass a program that insures fewer people and makes access to health care much more expensive because of high out-of-pocket costs – a program that is much worse for the American people – the opposite what he promised us.
The primary goal of his advisors is to reduce the role of government – fewer regulations and less government spending. They thought that they could cover their misdeeds with rhetoric that did not reveal their nefarious intentions – like making sure that everyone had “access” though remaining silent on the fact that for many actual health care would not be affordable even if accessible.
If President Trump is sincere in wanting everyone to have better health care that is affordable, then he needs a crash course in beneficial health policy.
Physicians for a National Health Program has a mission of educating the public and policymakers on the truth behind health care financing – that we are already spending enough to provide high quality health care for absolutely everyone without causing anyone to face financial hardship because of the costs of health care.
We even have a very successful businessman, Richard Master of MCS Industries, who can explain the advantages of single payer in terms that Donald Trump can really understand.
PNHP’s open letter needs to make it to the President’s desk, or better, directly handed to him so that he realizes that he was correct when he mentioned that single payer systems seemed to work well in other nations.
Time to make some noise – social media, community action, or whatever. He needs to see this letter.
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.
Doctors group: House GOP health plan is re-branded and far meaner version of ACA
The ‘American Health Care Act’ perpetuates the basic structure of the Affordable Care Act, including the subsidization of the private health insurance industry, while cutting benefits to the poor and middle class, and giving hundreds of billions in tax breaks to the rich
Physicians for a National Health Program, March 8, 2017
Physicians for a National Health Program decries the recently released Republican Obamacare replacement bill, the “American Health Care Act” (AHCA). That plan would constitute a major backward step in health policy, compounding the problems of uninsurance and underinsurance while handing over hundreds of billions of dollars to the wealthiest 2 percent of Americans.
Proposed as a replacement of the Affordable Care Act (ACA), the AHCA would maintain its basic structure. The bill would:
• Continue to channel billions of taxpayer dollars through wasteful private insurers;
• Sharply reduce the ACA’s subsidies (or “tax credits”) available to lower-income persons, particularly older adults, to purchase coverage;
• End the ACA’s cost-sharing subsidies for copayments and deductibles, increasing the cost of care for those with chronic medical conditions;
• Replace the ACA’s “individual mandate” penalty on the uninsured with a 30 percent surcharge on insurance premiums for those who experienced a lapse in insurance coverage;
• Slash federal funding for the Medicaid expansion beginning in 2020, and move towards a “per capita” cap on Medicaid spending that would squeeze state Medicaid budgets and push millions of enrollees out of the program;
• Increase the tax-favored status of Health Savings Accounts, which mostly benefit people in high income brackets;
• Reduce taxes on pharmaceutical, medical device and health insurance companies;
• Offer tax reductions totaling $274.6 billion over 10 years to the wealthiest 2 percent of Americans.
These and other provisions would take the nation in the wrong direction. Even with the ACA in place, 29 million remained uninsured in 2015; the ACHA would only push that number higher. And today, even many Americans with coverage face bankrupting medical bills for copayments, deductibles and uncovered services. By lowering the standards of private insurance plans and ending cost sharing subsidies, the ACHA would only intensify the problem of “underinsurance.”
The AHCA would replace the ACA with a worse, more regressive version of the original bill. This is not what Americans want or need. PNHP instead urges Congress to replace the ACA with a single-payer national health care program. Unlike the ACA or the AHCA, single-payer, Medicare for All reform could effectively control costs while creating a right to high-quality healthcare for everyone in America.
Although the Republican leadership has made feeble attempts at crafting rhetoric to sell their American Health Care Act (AHCA) – their legislation intended to repeal and replace the Affordable Care Act (ACA) – nobody is fooled into thinking that they are proposing an improvement over ACA. Millions would lose their insurance and millions more would have worse coverage that leaves them even more exposed to unaffordable out-of-pocket expenses.
AHCA is being sold as an improvement in access yet clearly access to health care would be further impaired because of the financial barriers to care that it erects. Also, when we already greatly burden American workers with policies that shift wealth from the workers to the wealthy, AHCA would introduce numerous tax changes that would further benefit the wealthy, compounding the injustices of income and wealth inequality.
Although the Democrats are unified in their opposition to AHCA, there is considerable opposition from within the Republican ranks as well. Heartless conservative Republicans want even more cuts in the beneficial programs advanced by ACA, diminishing further protection against health care insecurity and financial insecurity for those with medical needs. Other more moderate Republicans are concerned that the cuts are too deep and heartless, and some are also concerned about the attacks on women’s health care.
The Republicans have been unable to resolve these conflicts behind closed doors. But they did promise that they would repeal ACA immediately and so they are moving ahead with this legislation. If it fails, then they cannot be accused of not having made the effort. Then they can move on to legislation that they are really passionate about – tax reform benefitting the very wealthy.
We must not lose perspective. The nation desperately wants better and more affordable health care. The subject is hot. Although Americans have been dissatisfied with ACA, they now recognize that the Republican proposals would be worse. Many of those who are doing well under ACA have changed from opposition to support of ACA. But those who continue to face financial hardship and impaired access to health care clearly want more and are particularly disappointed that Trump and his fellow Republicans are not delivering on their promise.
ACA was an improvement, but not enough. Its administrative complexity makes it nearly impossible to achieve high quality affordable care for all merely by enacting administrative tweaks. The seven years of Republican strategy has failed to improve on ACA, and their proposals would only make health care access and affordability worse. We need something more.
An improved Medicare for all – a well designed single payer national health program – is precisely what we need. With it we would have affordable, high quality health care for everyone. While the topic of health reform is hot, we need to get this message out. Now.
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.
Examining The House Republican ACA Repeal And Replace Legislation
By Timothy Jost
Health Affairs Blog, March 7, 2017
On March 6, 2017, the House Republican leadership introduced Affordable Care Act repeal and replacement budget reconciliation bills in the Ways and Means (W&M) and Energy and Commerce (E&C) committees. The bills, collectively titled the American Health Care Act, are the committees’ responses to the instructions they received in the Budget Resolution passed by both houses of Congress in mid-January to prepare budget reconciliation legislation to repeal the ACA.
The committees will begin markup of the bills on March 8, 2017.
If the bills are passed by the committees they will be combined by the House Budget Committee and sent to the House Rules Committee, and then to the full House for a vote. The Congressional Budget Office has not released cost estimates of the legislation and it appears that committee markups will proceed without out CBO reports.
In summary, the legislation’s tax cuts will be very attractive to wealthy Americans and health insurers and providers, who would get a trillion dollars in tax breaks. It could cause consternation for Medicaid recipients and state Medicaid programs, which would see federal funding for Medicaid steadily diminish, potentially thinning out coverage. The legislation could be bad news for recipients of current tax credits who are older, sicker, and poorer, and who live in areas where care is expensive. They may be able to afford low actuarial value coverage with the tax credits the bills would provide them, but they are unlikely then to be able to afford the cost sharing that coverage will impose.
Higher-income younger people, on the other hand, would find coverage much more affordable than it is now under the legislation—the tax credits might fully cover their premiums and leave extra for their health savings accounts. Some insurers could find the state reinsurance money and continuous coverage requirement enough of an incentive to stay in the market, but others may not
Finally, one cannot know without a CBO report how this all works out. But it is hard to see how the bills pay for themselves, and they could result in significant losses in coverage.
Ways and Means summary of their portion of the “American Health Care Act”:
Ways and Means proposed legislation:
Energy and Commerce summary of their portion of the “American Health Care Act”:
Energy and Commerce proposed legislation:
G.O.P. Repeal Bill Would Cut Funding for Poor and Taxes on Rich
By Margot Sanger-Katz
The New York Times, March 6, 2017
Legislative language for what House leaders call the American Health Care Act, released Monday evening, would substantially cut back funding to states that cover poor adults through their Medicaid program. It would cut back on financial assistance for relatively low-income insurance shoppers above the poverty line.
It would offer new financial benefits for the upper-middle class and the rich. Americans higher up the income scale would be eligible for subsidies to help them buy health insurance. Taxes on high incomes would be reversed. And the law would allow people to save more money each year in tax-free health savings and flexible spending accounts — accounts that are most valuable to people who pay high income tax rates and have money to save.
That’s enough. Single payer.
Got health insurance? That doesn’t mean you’ll be able to pay your medical bills.
By John Murawski
McClatchy DC Bureau, March 4, 2017
Hospitals around the country are reporting record levels of debt on their books from an unlikely source: patients with health care coverage.
As health insurers and employers have shifted health care costs to patients through high deductibles and other out-of-pocket expenses, people who in the past may not have worried about paying for a hospital visit or a surgical procedure are getting hit with massive medical bills that they can’t pay.
Duke University Health System has seen patient interest-free payment plans rise from $19 million in June 2010 to $43 million in January. The increase is largely attributable to rising deductibles, said Keith Stover, Duke’s vice president of finance and chief financial officer.
Duke is fielding 1,500 patient calls a day, most of them asking why they got a bill since they’re insured, Stover said.
WakeMed Health & Hospitals also is experiencing a spike in patients needing help, setting up an average of 1,810 payment plans per month since October.
Wake Forest Baptist Medical Center in Winston-Salem, North Carolina, started offering zero-interest loans through Commerce Bank in November in response to patient deductibles as high as $14,300.
Southeastern Regional Medical Center in Lumberton, North Carolina, in December began assigning “financial counselors” to patients’ rooms to explain insurance benefits and payment options.
Duke Health’s 225 financial counselors contact patients before their scheduled procedures to discuss insurance benefits and payment options; every Duke clinic now has a full-time financial counselor on staff to work with patients.
UNC Health Care has 200 financial counselors to assist patients. “It’s going to be our responsibility to collect,” said Mark Miller, chief financial officer of UNC Health Care in Chapel Hill, North Carolina. “So much is getting left on the table because we can’t get it from the patient, or because they have chosen not to pay it, or they can’t.”
Republicans in Congress have been unable to coalesce around a single proposal to replace the ACA. But their proposals so far could drive up deductibles by lifting the ACA mandated cap on the out-of-pocket costs patients have to pay.
Consumer advocates say the high deductible trend is unsustainable. “They can be a barrier to care for people,” said Mark Rukavina, principal, Community Health Advisors, a Boston organization that advises nonprofit hospitals on billing, collections and finance.
In a system already tremendously overburdened with administrative excesses, we now have an escalating need for “financial counselors” because of the explosion in medical debt due to the expansion in the use of high deductibles – a tool to protect insurers by slowing the increase in insurance premiums, but at the cost of reducing the financial protection that is the very reason that insurance exists in the first place.
In crafting the Affordable Care Act (ACA) it was recognized that the actuarial value of the plans would have to be decreased (code language for introducing very high deductibles) to keep premiums affordable, and that required fairly generous subsidies and credits for lower-income individuals if they were going to be able to afford health care. But that left moderate-income families exposed to the larger, less affordable deductibles.
What has really increased the need for financial counselors is that employer-sponsored plans – the mainstay of insurance in the United States – have accelerated the adoption of high deductibles with which many working families struggle. It is now a problem in mainstream America. ACA did not directly address the problem of high deductibles in employer-sponsored plans, but it did compound the problem by tightening up on insurance regulation and design. Without higher deductibles, the premiums for employer-sponsored plans would have been driven up even higher.
So ACA made the problem of high deductibles worse. What about the Republican replace proposals? We will find out this week, but it doesn’t look good. The exchange plans will probably have a less generous tax subsidy, making plans less affordable for lower-income individuals. There will also likely be reduced regulatory requirements for private insurance, allowing them to market plans with lower premiums, but that will shift even more costs to individuals and families through yet higher deductibles and other cost sharing and through a reduction in plan benefits – requiring greater out-of-pocket spending.
So what are we getting? Exactly what we don’t need – more administrative costs in the form of financial counselors who assist us in handling the debt that health insurance was supposed to prevent.
We don’t need this. We should get rid of private insurance and replace it with a well-designed single payer national health program that provides first dollar coverage while containing medical spending through much more patient-friendly policies. We can simply fix Medicare and provide it for everyone.
Two months ago, this doctor was delivering babies. Now he’s at the nexus of the Obamacare fight
By Lev Facher
STAT, March 3, 2017
Dr. Roger Marshall was delivering babies in December. By January, he found himself across a breakfast table from Tom Price, offering emotional support to the Georgia congressman as he endured a contentious confirmation process to become the top health official in the new Trump administration.
Marshall, a few months ago just another doctor from Kansas, is now Congressman Roger Marshall.
Marshall has joined the GOP Doctors Caucus, a group of 16 lawmakers with health care backgrounds who have put themselves at the center of the effort to unwind the Affordable Care Act.
Marshall is as quick as any Republican to slam Obamacare, claiming firsthand experience of its effects from his time at Great Bend Regional Hospital in central Kansas. He helped grow the hospital from a four-bed surgical clinic to the full-service, physician-owned facility it is today.
Like many other Republicans, Marshall said he wants the health care system to rely on the free market rather than Obamacare’s regulations. He measures success in how many people can afford to leave the Medicaid program and enter the private insurance market.
The law’s Medicaid expansion, which Kansas has not adopted despite support from many hospitals, including some of Marshall’s former colleagues, is one of the big sticking points for Republicans. Many GOP-led states adopted it and want to see it preserved in some form.
Marshall doesn’t believe it has helped, an outlook that sheds light on how this new player in Washington understands health policy.
“Just like Jesus said, ‘The poor will always be with us,’” he said. “There is a group of people that just don’t want health care and aren’t going to take care of themselves.”
11 For the poor will never cease out of the land; therefore I command you, You shall open wide your hand to your brother, to the needy and to the poor, in the land.
1 It was now two days before the Passover and the feast of Unleavened Bread. And the chief priests and the scribes were seeking how to arrest him by stealth, and kill him; 2 for they said, “Not during the feast, lest there be a tumult of the people.” 3 And while he was at Bethany in the house of Simon the leper, as he sat at table, a woman came with an alabaster flask of ointment of pure nard, very costly, and she broke the flask and poured it over his head. 4 But there were some who said to themselves indignantly, “Why was the ointment thus wasted? 5 For this ointment might have been sold for more than three hundred denarii, and given to the poor.” And they reproached her. 6 But Jesus said, “Let her alone; why do you trouble her? She has done a beautiful thing to me. 7 For you always have the poor with you, and whenever you will, you can do good to them; but you will not always have me. 8 She has done what she could; she has anointed my body beforehand for burying. 9 And truly, I say to you, wherever the gospel is preached in the whole world, what she has done will be told in memory of her.” 10 Then Judas Iscariot, who was one of the twelve, went to the chief priests in order to betray him to them.
Dr. Roger Marshall, freshman congressman from Kansas, has already exposed his compromised sense of medical ethics by participating in the establishment of a for-profit, physician-owned private hospital – a prime example of the perversities of the medical-industrial complex. But then he had to bring Jesus into it, saying, “The poor will always be with us.” Marshall says that he doesn’t believe that Medicaid has helped the poor because they “just don’t want health care and aren’t going to take care of themselves.”
In the Old Testament, the Scriptures record that the Lord said, “For the poor will never cease out of the land; therefore I command you, You shall open wide your hand to your brother, to the needy and to the poor, in the land.”
In the New Testament, which presumably is Marshall’s source in the Scriptures since he was quoting the words of Jesus himself, Jesus did say, “For you always have the poor with you…” But Jesus continued (conveniently omitted by Marshall), “… and whenever you will, you can do good to them.” It seems as though Marshall does not will to do good to the poor. (Though, in context, would Marshall have thought the ointment was wasted? Probably not if it would otherwise have gone to the poor – a point with which those writing or translating the Scriptures thought Jesus might agree. An enigma.)
What I knew about Jesus was derived mostly in my childhood when I attended the Pilgrim Congregational Church in Pomona, California (choir practice on Tuesdays, Boys Brigade on Thursdays, Sunday School Sunday mornings followed by singing in the children’ choir in our church services). I have been forever grateful for the moral lessons that I learned from the Scriptures, including from the words of Jesus. In my earlier years of awakening I was saddened to see that some of the elders in our church – some of the wealthiest people in town – did not seem to have a commitment to what my perceptions were of what Jesus was trying to teach us, so I left the church. My salvation is that I have found that these moral principles hold just as solidly in the secular world and are practiced by my friends in the social justice movement regardless of their personal religious beliefs or lack thereof. Truth is truth, and fundamental morality exceeds all boundaries.
But when a physician – a profession with ethics dating back to the Hippocratic traditions – uses the words of Jesus to tell us that Medicaid – a public program to help the poor with medical needs – has not helped since they don’t want health care and are not going to take care of themselves anyway, then he must be a hypocrite. Jesus would have turned over the tables in the business offices of his physician-owned hospital. We certainly do not want him, nor his colleagues of like mind, making moral judgements as to how legislation defining how to finance health care for all in America should be crafted.
Polling Data Note: Beyond the ACA, the Affordability of Insurance Has Been Deteriorating Since 2015
Kaiser Family Foundation, March 2, 2017
The debate about the future of the Affordable Care Act and its individual insurance marketplaces may be taking the focus off the affordability challenges facing the broader population, most of whom get their health coverage through employers, Medicare or Medicaid.
New survey findings from the Kaiser Family Foundation show that health care has become somewhat less affordable even among those with health insurance. Since 2015, larger shares of people with health insurance say they have a difficult time affording their health care costs: from 27 percent to 37 percent for premiums, 34 percent to 43 percent for deductibles, and from 24 percent to 31 percent for copays and prescription drugs.
Other findings include:
* About three in 10 adults (29%) report someone in their household has had problems paying medical bills in the past year, often with real consequences. For example, among those reporting problems paying medical bills, seven in 10 (73%) report cutting back spending on food, clothing, or basic household items, while about six in 10 report using up all or most of their savings (61%) or taking an extra job or working more hours (58%) to pay their bills.
* Concerns about cost are also affecting whether and when some people seek health care. For example, a quarter (27%) of the public says that they or a family member living in their household put off or delayed getting health care they needed in the past year due to costs, and nearly as many say they skipped a recommended medical test or treatment (23%) or did not fill a prescription (21%).
* Nearly half of Americans (45%) say they would have difficulty paying an unexpected $500 medical bill. This includes those who say they wouldn’t be able to pay it at all (19%), those who would put it on a credit card and pay it off over time (20%) and those who would have to borrow money from a bank, payday lender, family or friends (7%). Among the uninsured and those with lower incomes, more than three in ten say they would not be able to pay a $500 bill at all.
* Significant shares of the public say they are “very worried” about not being able to afford health care services they think they need (25%), losing their health insurance (22%), or not being able to afford prescription drugs (21%). Overall, half say they are at least somewhat worried that they won’t be able to afford needed health care services.
Designed and analyzed by public opinion researchers at the Kaiser Family Foundation, the polls were conducted from December 13-19, 2016 and February 13-19, 2017.
At first blush this looks like just another one of those reports that shows that our health care financing system is not working as well as we would like it to. In fact, this is horrendous news. Let’s look at what this means.
This is brand new data collected after the Affordable Care Act (ACA) has been fully implemented. It provides a cross section of all sectors of the insured and uninsured, not just those in the ACA exchanges. The largest sector is those with employer-sponsored coverage – the mainstay of health insurance.
This survey shows that affordability continues to deteriorate, in spite of the benefits of ACA. More individuals and families are having problems paying medical bills to the extent that they have depleted their savings and are cutting back on other household essentials, including food!
Everyone should have the health care that she or he needs. Health care has become outrageously expensive. The health care financing system should be designed to allow people to circumnavigate the financial barriers to care. But what have we done instead?
For the majority of us we have turned the problem of high health care costs over to the private health insurers, pretending that they can use market forces to control health care costs for us. But what are they doing? They are protecting their own market for their insurance products by keeping their insurance premiums more or less affordable, but they are doing that by creating the very financial barriers from which insurance should be protecting us. Very high deductibles, coinsurance, copays, restricted benefits, narrow networks that create financial barriers to out-of-network physicians and hospitals – all are designed to shift health care financing from the insurance premiums to the pockets of patients. That’s great for the insurers but a disaster for patients.
And what is President Trump, HHS Secretary Price, and Congress offering us now? They have decided to reject the concept of guaranteed health care for all and replace it with the guarantee of ACCESS to insurance products and health care that we cannot afford. Some legislators are considering tax credits, but less that the subsidies under ACA. Affordability is already deteriorating and their proposals will only accelerate that deterioration.
We are already spending $3.2 trillion which is more than enough to provide quality care for everyone. But to do that we need to change to a financing system that would improve the allocation of these resources. A well designed single payer system would recover over $500 billion in wasted administrative services which would be enough to fill in the voids in care today. Also, we do not need to perpetuate cruel policies that block access to care by making it unaffordable in that other single payer tools can control spending in a patient-friendly manner (global budgeting, negotiated rates, bulk purchasing, budgeting of capital improvements, etc.).
Next week the House Energy and Commerce Committee is going to mark up the repeal and replace legislation. Their legislation would only make us even more susceptible to depleting our savings and forgoing basic essentials because of mounting medical bills.
This is catastrophic. It is time for a massive virtual march on Washington. We need far more than the National Mall could accommodate. This needs to go viral. We are all inundated with messages that we need to support health care for all – messages that you can click to donate a nominal amount. Bullshit! This is not simply about the administrative costs of our well-meaning advocacy organizations. This is about the health of our nation.
We need action! Now! Mobilize all of these groups that profess to support health care justice for all. Bombard Washington with 50 million demands for an improved Medicare for all. No, make that 100 million. They seem to be deaf in Washington.
Seriously, leaders of advocacy groups should organize conference calls today to initiate a process by which we could bombard Washington with electronic messages this weekend. The legislation moves forward next week. Remember that depleted savings and hunger are the default option.
Trump’s Speech to Congress
The New York Times, February 28, 2017
Transcript of section on health care (12 references to “Applause” omitted):
Tonight, I am also calling on this Congress to repeal and replace Obamacare …
… with reforms that expand choice, increase access, lower costs and at the same time provide better health care.
Mandating every American to buy government-approved health insurance was never the right solution for our country.
The way to make health insurance available to everyone is to lower the cost of health insurance, and that is what we are going to do.
Obamacare premiums nationwide have increased by double and triple digits. As an example, Arizona went up 116 percent last year alone. Gov. Matt Bevin of Kentucky just said Obamacare is failing in his state, the state of Kentucky, and it’s unsustainable and collapsing.
One third of the counties have only one insurer, and they’re losing them fast, they are losing them so fast. They’re leaving. And many Americans have no choice at all. There’s no choice left.
Remember when you were told that you could keep your doctor and keep your plan? We now know that all of those promises have been totally broken. Obamacare is collapsing, and we must act decisively to protect all Americans.
Action is not a choice; it is a necessity. So I am calling on all Democrats and Republicans in Congress to work with us to save Americans from this imploding Obamacare disaster.
Here are the principles that should guide Congress as we move to create a better health care system for all Americans.
First, we should ensure that Americans with pre-existing conditions have access to coverage and that we have a stable transition for Americans currently enrolled in the health care exchanges.
Secondly, we should help Americans purchase their own coverage, through the use of tax credits and expanded health savings accounts, but it must be the plan they want, not the plan forced on them by our government.
Thirdly, we should give our state governors the resources and flexibility they need with Medicaid to make sure no one is left out.
Fourth, we should implement legal reforms that protect patients and doctors from unnecessary costs that drive up the price of insurance and work to bring down the artificially high price of drugs and bring them down immediately.
And finally, the time has come to give Americans the freedom to purchase health insurance across state lines …
… which will create a truly competitive national marketplace that will bring costs way down and provide far better care. So important.
Everything that is broken in our country can be fixed. Every problem can be solved. And every hurting family can find healing and hope. Our citizens deserve this, and so much more, so why not join forces and finally get the job done and get it done right?
On this and so many other things, Democrats and Republicans should get together and unite for the good of our country and for the good of the American people.
Although President Trump has previously offered no specifics on his proposals for health care reform, he has said that his plan would provide “insurance for everybody…much less expensive and much better” (Washington Post, January 15, 2017). In this speech he calls for “reforms that expand choice, increase access, lower costs and at the same time provide better health care.” But then, what are the specifics of his proposal?
* Eliminate the mandate to purchase insurance: All honest policy analysts agree that would significantly increase the numbers of uninsured – not exactly a policy approach to cover everyone.
* Lower the cost of health insurance: Assuming health care costs remain the same, the only way you can reduce insurance premiums is through various innovations that shift more of the costs to the plan beneficiaries. Making an insurance plan more affordable impairs access to care because of the financial barriers created by the higher out-of-pocket expenses.
* Americans with pre-existing conditions should have access to coverage: The key word here is “access.” In December, the Republicans decided that they would drop the guarantees of health care coverage and instead insure access to coverage. They merely mean that will ensure that plans would be available in the market by relaxing the requirements that plans face today. Having access to an inadequate or unaffordable plan does not mean that you have access to affordable health care.
* Tax credits for purchasing coverage: Although he has not defined the tax credits here, the leading Republican proposal is that the tax credit would be based on age and not on income. Lower- and middle-income individuals may find that the tax credit is not adequate to make their share of the premium affordable – thus increasing the numbers of uninsured. If the tax credit is not refundable those who pay little if any taxes could not afford to purchase insurance.
* Expanded health savings accounts: People who do not have enough income to save some for cash reserves would not have enough to make deposits into a health savings account (HSA). The only distinguishing feature of HSAs over other savings is that HSA deposits are deductible from income for tax purposes. This form of “tax expenditure” is highly regressive since the wealthy benefit and the poor do not. Expanding the amount of the allowable contributions to HSAs benefits the wealthiest of us, using our tax money to reduce their net out-of-pocket expenses. This is a tax policy that directs the benefit to exactly the wrong place.
* Americans purchase the plan they want, not the plan forced on them: They would eliminate essential health benefits and actuarial floors, making much less expensive plans available, but plans that would expose many to financial disaster should significant health needs develop.
* Give our state governors the resources and flexibility they need with Medicaid: They would convert state payments for Medicaid to block grants or per capita caps, either of which enable the federal government to reduce transfers to the states. “Resources and flexibility they need” apparently means granting the states fewer resources so they can have the flexibility to throw more patients off of their Medicaid programs.
* Implement legal reforms that protect patients and doctors from unnecessary costs: This is the old saw that somehow malpractice costs are a major contributor to our national health care spending; they are not, though we do need tort reform. But that needs to be reform that protects patients who are harmed, not reform that allows physicians to escape their responsibilities. Rather we need to civilize the process through alternate dispute resolution.
* Bring down the artificially high price of drugs: Yes, but that requires a regulatory role of government, whereas the Republicans are reducing regulation, pretending that somehow the magic of the marketplace will put a lid on drug prices. But it is the market that is bringing us six figure drug prices.
* Freedom to purchase health insurance across state lines: Not only does this reduce plans to their lowest common denominator, preventing state insurance commissioners from exercising adequate control over renegade insurers, but also the insurers do not want to face the administrative costs of setting up provider networks and marketing their plans in regions that would not be profitable to them.
If Trump’s plan looks familiar, it is. These proposals are the same old proposals that the Republicans have been tossing around for years. These are the proposals of Ryan’s two white papers and the recent “leaked” legislative draft that the Republicans quickly dismissed because of the blow back they received. Also it resembles the previous legislation introduced by HHS Secretary Tom Price when he was in Congress.
Trump has been meeting with Price and has promised releasing his formal proposals in three or four weeks, though Trump wants them in two weeks. These meetings have led Trump to say that reforming health care is “unbelievably complex… nobody knew that health care could be so complicated.” But this speech is ominous. The Republican/Price/Trump proposals will reduce the federal guarantees of affordable health care, resulting in greater numbers of uninsured and in greater out-of-pocket costs that will be unaffordable for many more.
It looks like Trump’s promise of “insurance for everybody… much less expensive and much better” is deceptive. Insurance for everybody means access to insurance, not actually being insured. Much less expensive means insurance that does not protect your financial assets, it you have any. Much better means that you have a choice of purchasing worthless plans, if you call that better.
This deception reaches a plane that we have to call it for what it is…a lie. He could have fulfilled his promise by bringing us an improved Medicare for all.
Lessons From 3 Other Countries
By Regina E. Herzlinger, DBA; Barak D. Richman, JD, PhD; Richard J. Boxer, MD
JAMA, February 27, 2017
The most popular parts of the Affordable Care Act (ACA) are the most expensive. Universal coverage is a top priority not only for Democrats but also for President Trump. Both Republicans and Democrats want to preserve many costly coverage features of the ACA, including those that prevent insurers from precluding people with preexisting conditions and those that eliminate lifetime or annual coverage limits. The challenge is how to preserve these features and make insurance affordable.
A primary obstacle to achieving affordable universal coverage is the high costs of those with diseases or costly traumatic events — approximately 20% of individuals accounting for approximately 80% of health care spending. So, a key question is how to pay for their care.
Some nations in the Organisation for Economic Co-operation and Development (OECD) rely on a governmental single-payer model to achieve universal coverage, but this approach is politically infeasible in the United States. As the United States relies on private-sector insurance, 3 other countries that use private-sector insurance to offer affordable universal coverage provide some potentially helpful lessons.
Paying for Costly Patients
Some advocate creating risk pools for enrollees with preexisting conditions. This strategy removes individuals with high health care costs from the broad pool of enrollees and uses government funds to subsidize their insurance premiums. In turn, the cost of insurance is substantially reduced for the rest of those who are insured. This strategy, however, requires substantial infusions of funds.
If high-risk pools are part of the solution to attaining universal coverage, federal funding is essential. But federal policy makers are unlikely to commit a sufficient amount of funds to make this approach successful.
Another strategy to pool costly patients would channel them into Medicare and rely on the federal government as the ultimate risk bearer. But Medicare premiums are artificially controlled by passing some present spending onto future generations. Trustees project Medicare’s 75-year total spending in excess of dedicated revenues at $27.9 trillion, and the Centers for Medicare & Medicaid Services Office of the Actuary projects this amount at $36.8 trillion. Adding costly individuals to Medicare would only exacerbate these intergenerational problems.
This leaves a third strategy: the individual mandate — or as the Supreme Court characterized it, an annual tax assessed against individuals who have not purchased qualified health insurance within the calendar year. Although vilified by some, the mandate is attractive for several reasons. It is relatively easy to implement, is effective in pooling risk, and reflects the values of individual responsibility. Coverage is primarily funded by the enrollees rather than by general taxation. For these reasons, some nations that are committed to a private health insurance sector have achieved universal coverage and effective risk pooling by mandating the purchase of insurance.
Examples of the Individual Mandate and Penalties
Switzerland, Singapore, and Germany have achieved universal coverage and made insurance affordable even for their citizens with highest health care costs by instituting an individual mandate. One major difference, however, is that unlike the ACA, the mandates instituted by these countries are reinforced with effective penalties for nonparticipation, thus ensuring that lower-cost enrollees — generally healthier individuals — balance out the costs of the others who require more medical resources.
* In Switzerland, citizens must purchase health insurance. If they do not, government authorities automatically enroll them, selecting the insurance provider on the individuals’ behalf. Moreover, insurers can implement debt enforcement proceedings against anyone failing to pay their premiums and collect a penalty in addition to back premiums. The Swiss government subsidizes premium payments for more than a quarter of the population, including retirees who purchase the same insurance as workers.
* Singapore institutes compulsory contributions from employers on behalf of their employees to create medical savings accounts. Employees maintain these accounts for health care expenses such as health and disability insurance premiums, hospitalization, surgery, rehabilitation, end-of-life care, and outpatient services. Those failing to pay their premiums are subject to garnished wages and other legal actions that can force payment of back premiums, penalties, and interest. Unemployed or low-income individuals are eligible for government subsidies that enable them to pay for the premiums.
* In Germany, insurance is funded by compulsory contributions to private insurers levied as 7.3% of income. Unemployed individuals have their contribution taken out of their unemployment benefits coupled with means-based sliding-scale subsidies, and uninsured self-employed persons who later attempt to purchase insurance face payment of back premiums for the period in which they were uninsured.
In sum, health insurance models in Switzerland, Singapore, and Germany suggest that an individual mandate, with adequate subsidies, can achieve affordable universal coverage. But the recipe for their success also includes firm penalties. Achieving universal coverage, like these 3 nations, requires a more forceful approach.
From the Conclusions
If the goal is universal health coverage that provides care even for patients with the highest health care costs without relying on public insurance programs, the financial burden must be spread across the whole population. This requires either massive government spending, whether through high-risk pools or Medicare, or requiring individuals to purchase insurance.
It is time to stabilize the premiums of the universal insurance market by neutralizing the political disagreements surrounding the ACA’s mandate and penalties. As these 3 countries demonstrate, maintaining the popular aspects of the ACA requires keeping its less popular part, and achieving the stated goal of universal coverage requires a serious commitment to individual responsibility.
A Conversation With Regina E. Herzlinger, PhD: A New Individual Market on the Horizon
Managed Care, July 2011
Quotes from the interview:
“I have always supported universal coverage for personal and economic reasons. There are 40 million people who are uninsured. Typically, in any pool, 20 percent are sick. That’s 8 million people. How are we going to cover these 8 million sick people? The only way we can pay for them is to raise taxes — which is not going to happen — or to have universal coverage. Universal coverage is in many ways much more acceptable than a tax in which the well subsidize the sick.”
Are we headed toward a single payer system?
“I wouldn’t say that. I think we are going to a Swiss system. Employers will drop their health insurance coverage, not solely for reasons of cost. Many employers find buying health insurance onerous, and they would rather it be a consumer purchase.”
Accountable care organizations — does this concept have any legs?
“It’s like the Affordable Care Act itself — great idea, poorly thought through. Fee-for-service payment is perverse because it penalizes integration. The problem is the scope of the ACO, which is not just one disease or one condition, but everything for everybody. It’s not feasible to excel in managing every kind of care. It’s too complicated.”
Will the consumer model make its way to Medicare?
“Consumer-driven health care started in the commercially-insured population. I would hope it would go to Medicaid so that the poor aren’t stuck in this terrible program. And eventually it will go to Medicare because we have to solve the Medicare problem.”
The Congressional Budget Office thinks that senior citizens will be worse off under a voucher system from Medicare, which is Rep. Ryan’s plan.
“What the CBO failed to think about is, if 50 million seniors go out in the insurance market, is that market going to remain the same, or is it going to become more competitive in ways the Swiss insurers are competitive, by reducing administrative costs? The CBO’s mistake was assuming that nothing would change. If 50 million seniors show up in the insurance market, they are going to force insurers to become more competitive.”
Providers talk about the difficulty of dealing with so many insurance companies. Is it going to get worse for them as more health plans enter a consumer-driven market?
“Well, either you are going to have a lot of insurers breathing down your neck, or it’s going to be single payer. Our last gasp is consumer-driven health care. Take your choice.”
The theme of this article is somewhat astonishing. The authors recommend that we modify the most unpopular element of the Affordable Care Act – the mandate to purchase private health insurance or face penalties – by increasing the severity of the penalties to a degree that they will drive people to purchase plans, thereby forcibly achieving near universal coverage. This, as the title of the JAMA article implies, is to avoid the inevitability of single payer, as if single payer were so terrible that it is worth it for us to make being uninsured an unconscionable act warranting severe punishment.
The intent of this approach to health care financing is to avoid “massive government spending” as they say might occur with high-risk government insurance pools or by enrolling high-risk patients in Medicare (or, of course, single payer). By instead requiring individuals to purchase insurance the costs would shift to the individuals. But considering our very high national health expenditures, who could afford to pay for plans that include all of the high-risk individuals in the insurance pools? Of course, only wealthier, higher-income individuals. That puts us back into the position of either providing government subsidies that are more generous than those currently offered under ACA, or opening the market to barebones plans that would make health care access unaffordable.
Harvard Business School Professor Regina Herzlinger has been a long-time advocate of consumer-directed health care. She believes that “the stated goal of universal coverage requires a serious commitment to individual responsibility” with the individual functioning as an informed consumer in the private health insurance marketplace. Her opposition to single payer is ideological, preferring markets over governments.
She has repeatedly threatened us with single payer if we don’t establish policies that promote consumer-driven health care. In spite of her disdain for single payer, she does recognize that “either you are going to have a lot of insurers breathing down your neck, or it’s going to be single payer. Our last gasp is consumer-driven health care. Take your choice.”
Some choice: Market-driven hell or single payer nirvana.
If Obamacare Exits, Some May Need to Rethink Early Retirement
By Austin Frakt
The New York Times, February 27, 2017
Here’s another possible consequence of repealing the Affordable Care Act: It would be harder for many people to retire early.
Americans reaching 65 become eligible for Medicare. Before reaching that age, some can get retiree coverage from their former employers. But not very many companies, especially small ones, offer medical insurance to retirees. If early retirees are poor enough, they could turn to Medicaid. To retire early, everybody else would need to turn to the individual health insurance market. Without the subsidies and protections the A.C.A. put in place, health care coverage would be more difficult to obtain, cost consumers more where available, and provide fewer benefits than it does today.
But it is clear that with A.C.A. repeal on the table, people contemplating early retirement may need to reconsider.
It seems that our goal should be to remove financial barriers to health care for all of us so we can get the health care we need when we need it.
So why do we make it difficult by establishing such arbitrary qualifications for health coverage: employment status (employer-sponsored plans), older age (65 for Medicare), younger age (CHIP), income (Medicaid), prior military service (VA), ethnic heritage (Indian Health Service), temporary unemployment (COBRA), or whatever?
This complexity contributes greatly to the profound administrative waste in our system – now over a half a trillion dollars a year that could be recovered, according to a report this month in the Annals of Internal Medicine. It also increases instability in our health care with ever-changing provider networks, creating a degree of fragmentation that is unique in the U.S. health care system.
It would be so much simpler and efficient to improve Medicare so that it is appropriate for all ages, and then automatically include everyone, using an equitable method of funding that would be affordable for all.
With the difficulty that Congress is having with decisions on how to improve health care financing, why don’t they finally take a serious look at a proven model that has worked well in other nations – a single payer national health program – in the form of an improved Medicare for all?
What They Want in a Health Care Plan
By Jennifer Tolbert and Larisa Antonisse
Kaiser Family Foundation, February 22, 2017
In order to gain a better understanding of the personal experiences of Trump voters with health coverage provided through the ACA and the changes they would like to see in the health system moving forward, the Kaiser Family Foundation (KFF) held focus groups with individuals who voted for Trump in cities in three battleground states: Grand Rapids, Michigan; Columbus, Ohio; and Harrisburg, Pennsylvania.
FOR MANY, MARKETPLACE COVERAGE HAS NOT LIVED UP TO EXPECTATIONS
* Three years into the implementation of the Marketplaces, participants still seemed overwhelmed by their plan choices and confused about key aspects of their plans.
* Participants were particularly frustrated by unaffordable out-of-pocket costs associated with high deductibles.
* The high cost of prescription medications was a common complaint and many Marketplace participants did not believe their plan protected them from these costs.
* Participants also expressed frustration at receiving surprise medical bills for services they thought were covered.
WHAT THEY WANT IN A REPLACEMENT PLAN
* When asked what they would want in an ACA replacement plan, participants’ top priority was coverage that was more affordable—affordable premiums, but most importantly, affordable out-of-pocket costs.
* They also wanted more help for people like them.
* Access to doctors and hospitals was another priority for participants.
* Participants wanted simplification of health plan choices and greater transparency from the insurance companies.
VIEWS OF REPUBLICAN PROPOSALS
* Participants rejected the idea of high deductible plans, even when coupled with premium tax credits to cover the premium and Health Savings Accounts (HSAs) to save for out-of-pocket costs.
* While there was general support for the concept of an HSA, many did not understand what they were and said they did not have the savings, or would not be able to save enough during the year, to cover the out-of-pocket costs associated with a plan with a high deductible.
* Participants also rejected the concept of basing tax credits solely on age regardless of income.
* Frustrated by the complexity and uncertainty of the current system as well as proposals to replace it, several participants advocated for a single-payer system modeled on the Canadian health care system.
These focus groups were uniquely composed of Trump supporters in battleground states who also received health care coverage through the Affordable Care Act. Were they, like many conservatives, supporting the repeal of ACA – a leading issue for Donald Trump in his campaign? If they were not satisfied with ACA, then what did they want?
They remain concerned about three of the leading problems with today’s private health plans – high premiums, high deductibles, and narrow provider networks. Their top priority was affordability – affordable premiums and affordable out-of-pocket expenses. They also want greater access to physicians and hospitals than the narrow networks allow, and they do not want to receive surprise medical bills from out-of-network providers. They also want simplification of health plans (the greatest simplification being single payer).
Although some look upon Trump supporters as being conservatives who want to reduce the role of government, actually several in this group were able to pull together the policy issues and come to the conclusion that, to reduce “the complexity and uncertainty of the current system,” we should enact “a single-payer system modeled on the Canadian health care system.”
President Trump, these are your supporters. You need to read the article from the Annals of Internal Medicine: “Single-Payer Reform: The Only Way to Fulfill the President’s Pledge of More Coverage, Better Benefits, and Lower Costs” by Steffie Woolhandler, MD, MPH and David U. Himmelstein, MD You can download it at this link:
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