Senate HELP rejects enabling legislation for state single payer experiments

Posted by on Tuesday, Jul 14, 2009

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.

Senate HELP Committee
July 14, 2009

Sen. Bernie Sanders just offered an amendment to the Senate HELP health care reform bill that would allow a limited number of state experiments with single payer systems. The proposal would have provided waivers from federal regulations such as ERISA, and would have authorized current federal spending on programs such as Medicare and Medicaid to be transferred to the state to be used in the single payer program.

Those voting for the amendment:

Bernie Sanders
Tom Harkin
Sherrod Brown
Jeff Merkley

All Republicans and all other Democrats voted against it.

List of committee members:

Senate HELP amendment on "data exclusivity"

Posted by on Tuesday, Jul 14, 2009

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.

NVCA Study Supports 12-Year Data Exclusivity Period

By Donald Zuhn
Patent Docs
Biotech & Pharma Patent Law & News Blog
July 13, 2009

On Friday, the National Venture Capital Association (NVCA) released the results of a study suggesting that “a data exclusivity period of at least 12 years for innovator products is a critical fulcrum in the effort to balance cost with the preservation of biotech innovation.”


Executive Session on the Affordable Health Choices Act

U.S. Senate HELP Committee
July 13, 2009

Consideration of the Enzi/Hatch/Hagan amendment on establishing a data exclusivity period of 12 years for biotech innovation

Sen. Orin Hatch: I don’t know a biotech company that isn’t for this bill, for this 12 year data exclusivity.


Sen. Kay Hagan: These individuals are out there looking for venture capital to obviously help them get these drugs to market… In order for our country to maintain this innovation and this research we need 12 years of data exclusivity.


Sen. Judd Gregg: Money flows into biologics research because capital moves there to make money. That’s the way a market system works.


Sen. Tom Harkin: Keep in mind what we’re talking about here. We’re not talking about patents. Everybody gets a 20 year patent… What we’re talking about here is data, data exclusivity… How do you get that data? You get it through FDA supervised trials… Where do they do those clinical trials? Academic health centers. Who supports academic health centers? Our taxpayers… When should that data be released so that another company out there, some other entrepreneurs, can look at the data and say… I’ll bet if we changed this and did this, we might come up with a new formulation that might actually help something else. They’re still going to have to go through their clinical trials… At least they’ll be able to look at the data. If you don’t do that that means that the company can sit on that data for 12 years. Then they let the data out. Clinical trials will take another 7 years or more, so you’re going to have at least a whole 20 year run in there… before anyone can ever surface with anything even comparable to what that drug or that biologic is.


Sen. Bernie Sanders: Let’s find out why year after year the drug companies make hugh profits, look at why the drug companies have never once, to the best of my knowledge, have never lost a political debate here in Congress… (medicine) doesn’t do anybody any good if they can’t afford it. I think for year after year we’ve been paying a lot of attention to our friends in PhRMA, who are spending, I don’t know what they spend in lobbying and campaign contributions, a whole lot of money. Maybe it’s time that we start worrying about the people who have to pay for this medicine.


Sen. Sherrod Brown: You know what we’ve not talked about, Mr. Chairman? We’re not talking about how much these biologics are costing patients. Let me give you some numbers. (examples)… 48 thousand dollars… 20 thousand dollars …100 thousand dollars. You know what the average wage in my state is? 46 thousand dollars… If we do this giveaway to the drug industry, this giveaway to the biologic companies, it means profits are up for them, it means executive salaries are up for them, it means we can all feel good, but let’s think about the patients, let’s think of the patient with breast cancer who has got to spend 1000 dollars a week… the patient with colon cancer who’s got to spend 2000 dollars a week… What kind of progress is that, Mr. Chairman?


The data exclusivity amendment passed by a vote of 16 to 7, with several Democrats voting in support.

421 minute video of the July 13 afternoon session:

For the past week or so I’ve been live-streaming the Executive Session of the Senate HELP Committee as they have been marking up the Kennedy health care reform bill, the Affordable Health Choices Act. It has been running at the corner of my computer screen while I have worked on other projects. Since I am not competent at multi-tasking, I’m pretty jaded right now.

Last evening’s session devoted to the data exclusivity amendment was the longest amount of time they spent on any issue in the reform legislation. I stopped my other work to watch it. This morning, I’m not only jaded, but I’m also depressed. I’ll tell you why.

Earlier in the day yesterday, I sent out the following quote from Bill Moyers: “Nothing will change — nothing — until the money lenders are tossed out of the temple, the ATM’s are wrested from the marble halls, and we tear down the sign they’ve placed on government — the one that reads, ‘For Sale.'”

I didn’t sleep last night. Instead of counting sheep, I kept watching, in my nightmare, each of those Senators who voted yes picking up their bundle from the ATM machine in the marble halls on their way out as they passed the “For Sale” sign at the door.

But this isn’t about my nightmare. It’s about the 307 million of us who are the merchandise in Congress’s rummage sale. That’s why I’m depressed.

Bill Moyers on "The Select Few"

Posted by on Monday, Jul 13, 2009

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.

Bill Moyers & Michael Winship: Some Choice Words For “The Select Few”

Bill Moyers Journal
July 10, 2009

Enter “the select few who actually get it done.” Three out of four of the big health care firms lobbying on Capitol Hill have former members of Congress or government staff members on the payroll — more than 350 of them — and they’re all fighting hard to prevent a public plan, at a rate in excess of $1.4 million a day.

Health care policy has become insider heaven. Even Nancy-Ann DeParle, the White House health reform director, served on the boards of several major health care corporations.

President Obama has pushed hard for a public option but many fear he’s wavering, and just this week his chief of staff Rahm Emanuel — the insider del tutti insiders — indicated that a public plan just might be negotiable, ready for reengineering, no doubt, by “the select few who actually get it done.”

That’s how it works. And it works that way because we let it. The game goes on and the insiders keep dealing themselves winning hands. Nothing will change — nothing — until the money lenders are tossed out of the temple, the ATM’s are wrested from the marble halls, and we tear down the sign they’ve placed on government — the one that reads, “For Sale.”

The public option was the strategy of a large group of progressives to circumvent “the select few” who have continued to make sure that comprehensive reform was not politically feasible. With the favorable election results and with their campaign to market “your choice of health plans,” the progressives were confidant that they would be able to use the public option as a backdoor entry to affordable health care for all.

Once you think that you’ve closed the deal, you’re supposed to take down the “For Sale” signs. These progressives forgot to do that, and “the select few” came in with a lot more money and bought the place out from under them.

Who is left to toss the money lenders out of the temple? Or do they own the place in perpetuity?

Excluding seasonal agricultural workers

Posted by on Friday, Jul 10, 2009

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.

Harvesting Justice

By Bruce Goldstein
July 10, 2009

Sen. Hagan (D-NC) introduced Amendment 200 for the health care reform bill being discussed in the Senate Health, Education, Labor and Pensions (HELP) Committee, called the “Affordable Health Choices Act.”

Hagan’s amendment would exclude from the definition of “employees” any “temporary or seasonal agricultural workers . . . for the purposes of determining the size of an employer.” Agricultural employers of seasonal farmworkers would not be required to participate in the system because they would be considered to be too small. Seasonal farmworkers would be denied health care coverage.

Seasonal agricultural workers earn an average of $12,500 to $15,000 per year . They put food on our table by cultivating and harvesting fruits and vegetables, raising chickens, herding sheep, cutting flowers, and harvesting our Christmas trees. They work in the second or third most dangerous occupation. They cannot afford health insurance. It’s morally wrong — and it’s counterproductive economically — to exclude farmworkers from the plans for a reformed health care system.

Everyone should have health care. Everyone.

Premium increases in non-profit health plans

Posted by on Thursday, Jul 9, 2009

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.

Health-plan costs soar for individuals

By Kyung M. Song
The Seattle Times
July 9, 2009

In what is becoming an annual ordeal for policyholders, Regence BlueShield is raising premiums for 135,000 individual health-plan members in Washington by an average 17 percent on Aug. 1.

It is the third consecutive year that the state’s largest provider of individual coverage has boosted rates by double digits. And it comes after two other insurers, Group Health Cooperative and LifeWise Health Plan of Washington, recently imposed similarly steep premium increases.

North Seattle resident Gail Petersen said having more choices won’t make health plans any more affordable. Petersen, 55, and her husband pay more than $1,400 a month to Regence to cover their family of five and will pay $300 more starting in August.

In 2008, Group Health rolled out eight products to join its lineup of a dozen individual health plans. They included high-deductible health savings accounts, which allow people to put aside up to $5,950 annually in pretax dollars — if they have that much upfront — to pay for medical expenses.

By catering to different population segments, Group Health in the past 15 months has nearly doubled its individual-plan members to 36,000. But those new customers are facing a 13 percent rise in premiums because Group Health underestimated anticipated medical claims, said Mike Foley, a spokesman for the co-op.

Once Congress passes a mandate for individuals to purchase health plans, presumably non-profit Regence BlueShield, as the largest provider of individual plans in the state of Washington, would be a provider of those plans. Also, Group Health Cooperative is the co-op that has been proposed to serve as a model for the public option.

Group Health has been shifting more costs to patients through consumer-directed high deductible plans and HSAs, and still has a double digit hike in premiums. Some model.

Can anyone seriously state, with a straight face, that mandating purchase of these plans will somehow magically end the double digit increases in premiums for these plans?

The answer to this question is actually quite complex, but the fundamental truth is that the cost containment measures under consideration in Congress will have very little impact in slowing the escalation of health care costs.

All other nations have health care financing systems that are much more effective in containing costs and without leaving people out, as we do. One simple click on this link will demonstrate in a single image how the United States is an outlier (and will remain so without bona fide financing reform):

In this graph, note that Canada and the United States followed the same curve until Canada established its single payer system. Then look at what happened.

Can Medicaid fill the gap?

Posted by on Wednesday, Jul 8, 2009

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.

To: Sen. Judd Gregg, Ranking Member, Senate Budget Committee

From: Douglas W. Elmendorf, Director

Congressional Budget Office
July 7, 2009

In response to your request, the Congressional Budget Office (CBO) has considered the likely effects on federal spending and health insurance coverage of adding a substantial expansion of eligibility for Medicaid to the Affordable Health Choices Act, a draft of which was recently released by the Senate Committee on Health, Education, Labor, and Pensions (HELP).

CBO has not yet had time to produce a full estimate of the cost of incorporating any specific Medicaid expansion in the HELP committee’s legislation. However, our preliminary analysis indicates that such an expansion could increase federal spending for Medicaid by an amount that could vary in a broad range around $500 billion over 10 years. Along with that increase in federal spending would come a substantial increase in Medicaid enrollment, amounting to perhaps 15 million to 20 million people. Such an expansion of Medicaid would also have some impact on the number of people who obtain coverage from other sources (including employers). All told, the number of non-elderly people who would remain uninsured would probably decline to somewhere between 15 million and 20 million. (For comparison, CBO’s analysis of the draft legislation that was released by the HELP committee found that, absent any expansion of Medicaid or other change in the legislation, about 33 million people would ultimately remain uninsured if it were to be enacted.)

From the start it was recognized that insurance exchanges, even if they included a public option, could never provide affordable coverage for low-income individuals. The Medicaid program would have to be expanded to cover this more vulnerable population.

It was also recognized that, even with subsidies, there are many individuals who could not afford to purchase plans through an exchange yet have incomes above the thresholds that would qualify them for Medicaid.

That has led to the new definition of universal coverage as being “close to 95 percent.” This CBO analysis provides support for that view. Leaving only 15 to 20 million people without coverage has become one of the parameters that will define “success” in the reform efforts.

And costs? This Medicaid expansion can be accomplished for only half a trillion dollars (federal component), that is if it is agreed that the program will continue to be chronically underfunded. If it is eventually decided that Medicaid must cover actual health care costs, then add those costs to this half a trillion dollars plus to the funds already obligated for the 60 million people now covered by Medicaid. Once 75 to 80 million people are on Medicaid – over one-fourth of our population – adequate funding will be essential if there are to be enough willing providers to be there to give care when needed.

Keep in mind that all health care costs still must be met one way or another in a fragmented multi-payer system, but with the inevitability of inequitable cost shifting. This inequity potentially can have an adverse impact on the health and finances of tens of millions of Americans. However the total costs are much higher than they need to be because of the profound inefficiencies of this dysfunctional financing system which Congress has elected to protect and expand.

Under a single payer system – a reformed Medicare for all – everyone would be included automatically and without the projected cost overruns that are plaguing the current reform process. Those were the goals of reform, but they seem to have been chewed up in the legislative sausage machine of Congress.

A German comments on U.S. health care

Posted by on Tuesday, Jul 7, 2009

The following comments are in response to a recent Quote of the Day by Don McCanne about the broken, employer-based health insurance system in the United States.

By Diana Stritzel

I just wanted to say that I really enjoy reading your articles and feedback on what’s going on about health care in the U.S. I don’t remember how I found your list and subscribed to it, but I find it really useful to learn more about the system.

Being German by birth, I find it really awful what people here in the U.S. are being subjected to just to go and see a doctor. I’ve had people at my workplace telling me how horrible it must be that I don’t have the choice of doctor in my country of origin. I was like …What? I never had so many problems in any other country I’ve been in before.

The U.S. is the worst. (I’ve lived in United Kingdom, Italy, New Zealand and Australia.) My employer provides coverage, and not a bad one, as I’ve been told. Now, I’ve had nothing but trouble with the insurer (Aetna). I was on PPO plan before, but now I moved to my employer’s state (California) and I’m covered on Aetna’s HMO plan.

But for all plans I have to go online or call them first, and find a doctor which is in the network, so that Aetna covers it. In Europe I never had that problem, I can go to any doctor anywhere and I don’t need to ask or check with insurance first.

Then there’s the administrative effort required. Every time I go to a doctor, I have to fill out so much paperwork, and sign three statements that I will pay for all charges incurred in case my insurance doesn’t pay. As if that wouldn’t make you feel more miserable than you already are (seeking a doctor in the first place).

And after all that, I’ve still had bills coming to my house, which led me to call my insurance company and they told me I’ll have to pay these, because my doctor requested tests from a lab which is not in Aetna’s network. So now I have to be paranoid about each test the doctor wants to do, and ask the doctor to please use a lab which is covered by Aetna. Outrageous!

After my move to California I was unlucky enough to be in need of emergency room. They suggested I go for a follow-up in a couple of days. Since I hadn’t been to my “PCP” yet, and I live in San Diego, whereas Aetna send me a coverage card which stated that my PCP is in Los Angeles, when trying to change my PCP to one in San Diego I failed in three attempts (one online, and two by phone). Once I was in the doctor’s practice, they called to verify with Aetna that this was changed (because I only had the card which stated the L.A. doctor’s name), and Aetna’s employees said no. (I had been on the phone with them forever until they finally said yes, we’ve changed it.)

The doctor suggested I pay for the visit and claim it back, but I had learned from before (my PPO plan) that Aetna will find a way to never pay these back to me. So again I called them up and asked for changing my doctor. I was wondering why they added a doctor in L.A. in the first place as they had my correct address in San Diego.

Anyway, after subjecting me to lots of useless questions like “When are you planning to change your PCP again?” (which made me wanna cry…. I didn’t choose that doctor!), finally they said that they changed it, and I made them give verbal confirmation to the practice right away, so I could finally see a doctor.

I haven’t received any bills yet, but I’m wondering when they might come.

I think the system as a whole is really awful. Hard to see any light at all, with politicians taking the bribes from insurance companies and such statements as Obama’s below. [Editor’s note: the reference is to President Obama’s comment that moving to a single-payer system would be disruptive.] I don’t understand why Americans don’t fight more for health care, which is one of the most important things to have. The feeling of security that comes with a health care system like in the U.K. (where I studied and lived many years) is just not replaceable.

I for my part wish you all the best, and I do hope you will not stop fighting for your right to health care (yes, in my opinion it is a right which every human should have).

Thanks for your articles and the awareness you bring to this topic. I’m following Ralph Nader as well, and I do hope that despite all the ridiculing your media does to him, that maybe one day someone will listen and change the system. I hope I’ll see the day, I know for sure that I won’t be living in U.S. by then though.

Thanks and keep going!

The hijacking of health reform

Posted by on Tuesday, Jul 7, 2009

Originally published in The Berkshire Eagle

Headlines in the Berkshire Eagle recently proclaimed that Berkshire Health Systems (BHS) is cutting the equivalent of 65 full-time jobs, and will lose $3 million this year. This is neither good for employment nor for the health of our population in the Berkshires. The culprits are the cuts to Medicaid and Medicare, the programs that cover 70 percent of the BHS population.

BHS president David Phelps reports that financial problems at Berkshire Medical Center have been aggravated by Massachusetts health care reform. While more patients have enrolled in insurance plans, the reimbursements for these plans are similar to Medicaid rates, which don’t actually cover the cost of care.

As the major non-profit provider of health care for the Berkshire community suffers financially, the for-profit insurance industry, (which only administers the funds, and provides no actual health care services), is raking in the money. In the current economic and health care crisis, United Health Group, America’s largest health insurance company, enjoyed an increase of 8 percent in revenues for the first quarter of 2009, with a net profit of $984 million. There is something wrong when the administrators of the health care funds are making exorbitant profits, while the providers of the health care services are struggling to remain solvent.

The private for-profit insurance industry diverts roughly $400 billion/year from medical services. In addition, the Senate Commerce Committee recently released a staff report about how health insurers have forced consumers to pay billions of dollars in medical bills that the insurers should have paid themselves.

Will the current health care reform being formulated in Washington address these issues? Not a chance, even if President Obama gets a public plan option into the reform legislation. Dr. Steffie Woolhandler, a founder of the 16,000-member Physicians for a National Health Program, stated in her testimony to Congress: “Insurers compete by not paying for care: by denying payment and shifting costs onto patients or other payers. These bad behaviors confer a decisive competitive advantage. A public plan option would either emulate them — becoming a clone of private insurance — or go under. A kinder, gentler public plan option would quickly fail in the marketplace, saddled with the sickest, most expensive patients, whose high costs would drive premiums to uncompetitive levels.”

In addition, the overhead for a public plan option would be higher than for Medicare, which automatically enrolls seniors at 65, deducts premiums from Social Security checks, and does no marketing. The administrative costs for the whole health care system would remain astronomical, as health care providers would continue to struggle with mountains of paperwork and denials of payment from multiple insurance companies. A public plan option would not curb the escalating costs of new technology, and would not address variability in the quality of care.

The only way to attain universal health care coverage, while containing escalating health care costs and standardizing quality of care, is to eliminate the insurance companies, and establish a single-payer “Improved Medicare for All” program. Hospitals, doctors and other providers must be adequately reimbursed for their medical services. This would be possible if the profiteering and waste of the health insurance industry were eliminated, and those health care dollars went to the actual provision of medical care. And hospitals could be paid like fire departments, with a single monthly check and little billing. There is federal legislation for a national health program in both houses of Congress, John Conyers bill, HR 676, and Bernie Sanders bill in the Senate, S.703.

Last year a survey of doctors showed that 59 percent support a national health plan, up from 49 percent in 2002. (Only one in five doctors are in the American Medical Association, which opposes a national health plan). So why is single-payer health care reform “off the table”‘ as Senator Max Baucus, chairman of the Finance Committee, said, before he threw eight single-payer advocates, including several doctors, out of a “public roundtable discussion” and had them arrested. Could it be related to the more than $1 million in donations Baucus received from the insurance and pharmaceutical industries in the 2008 election year cycle?

Wendell Potter, a former health insurance industry insider has this to say, “. . . big for-profit insurers have high-jacked our health care system and turned it into a giant ATM for Wall Street investors, and . . . the industry is using its massive wealth and influence to determine what is (and is not) included in the health reform legislation members of Congress are now writing.”

What is going on in Washington right now is not in the best interests of patients, or the doctors and hospitals that serve them. Patients have no lobbyists speaking for their interests in Congress. Most doctors do not want the AMA to speak for them. Contact your congressmen and ask them to sponsor HR 676 and Bernie Sander’s bill. (On his Web site, Sanders also has an online petition you can sign and pass along to your friends).

Pay-go that builds rather than destroys

Posted by on Tuesday, Jul 7, 2009

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

A pay-go option for health-care reform

By John Geyman
The Seattle Times
July 6, 2009

As Congress recessed for the July Fourth holiday, the debate over health-care reform was reaching a fever pitch. Now the top domestic issue for the Obama administration, the biggest questions are how much a reform bill will cost and how to pay for it, quite aside from how effective a “reform package” will be.

Skyrocketing costs that are out of control are the hallmark of our present system. Yet legislators have already acceded to pressures and dollars from stakeholders in the present system (within which costs are revenue) and are only considering options that “build on the present system.”

After months of work, legislative committees in Congress have brought forth drafts of proposals that the Congressional Budget Office (CBO) is starting to score in terms of cost and effectiveness. As expected, the costs of these incremental proposals are high — the first number of $1.6 trillion over 10 years (while still leaving 36 million Americans uninsured) sent these committees back to the drawing board. At the moment, leading Senate Democrats are hailing $1 trillion over 10 years as potentially doable.

After presiding over huge deficits during their eight years in power, Republicans are now demanding “pay as you go” (pay-go) policies. Together with Blue Dog Democrats, they are threatening to act as spoilers of any health-care-reform bill on its price tag alone.

Given the dimensions of these difficult economic times — including a $1.8 trillion deficit for 2009, $5 trillion in new federal debt over this year and next, and rising unemployment — pay-go makes good sense. And the president is making the case that his health-care plan must pay for itself.

Conventional “wisdom” (as generated by the mainstream corporate media) says that any health-care reform will cost a lot, and that there is no pay-go option. But there is.

Single-payer financing (public financing coupled with a private delivery system, a reformed “Medicare for All”), as embodied in Rep. John Conyers’ bill (HR 676 in the House) with its 83 co-sponsors, will yield savings of some $400 billion a year. That’s enough to assure universal coverage for all Americans while eliminating all co-pays and deductibles — the ultimate pay-go. Single-payer will give us far more efficient, affordable, effective and reliable health care than our present multipayer system. Health insurers have known for years that they can’t compete on a level playing field with single-payer, and have only been surviving by favorable tax policies and other subsidies from the government.

This recent testimony before the U.S. Senate Committee on Commerce, Science and Transportation by Wendell Potter, former head of corporate communications at Cigna, says it all: “I know from personal experience that members of Congress and the public have good reason to question the honesty and trustworthiness of the insurance industry. Insurers make promises they have no intention of keeping, they flout regulations designed to protect consumers, and they make it nearly impossible to understand — or even to obtain — information we need.”

Many studies over the past two decades, including those by the CBO, the Government Accountability Office (GAO) and the nonpartisan Economic Policy Institute, have concluded that single-payer can assure universal coverage and still save money. HR 676 needs to be brought out of the closet and put on the table for CBO scoring against other options being considered in Congress, all of which cost much more and fail to provide universal coverage.

President Obama has brought forward the concept of audacity of hope. Is it too audacious now to hope that the legislators we elect to Congress can see beyond their campaign contributions and the lobbying efforts by corporate stakeholders to require that single-payer be scored?

(Dr. John Geyman is professor emeritus of Family Medicine at the University of Washington, past president of Physicians for a National Health Program, and a member of the Institute of Medicine.)

As expected, Congress ran into problems when they tried to figure out how to pay for health care reform. They stubbornly adhered to the principle that reform must be built on our dysfunctional system of profitable private plans for the healthy and taxpayer-financed public programs for the sick, even though numerous studies have shown that this is the most expensive model of reform.

Before the process began it was already understood that health care has now become so expensive that a health plan with adequate benefits would require massive public subsidies to make it affordable for average-income individuals and families. It is the size of the subsidies that would be required for them to work that would be the budget busters. Now that they are at the point that decisions must be made, they are relying on a process analogous to innovation in the marketplace, shunning their obligation to be responsible public stewards.

For the average American, they are establishing a standard of a bottom-tier package of benefits (a bizarre concept that requires greater out-of-pocket spending for those needing health care than that required of the wealthy with their higher-tiered plans). They are paring back the income eligibility levels such that there would be no subsidy above 300 percent of the poverty level ($32,500 for an individual or $66,000 for a family of four). These numbers simply do not make health care affordable for middle-income Americans when you consider that the Milliman Medical Index is now $16,771 (the average cost of family health care for the healthier sector covered by employer-sponsore plans). That doesn’t even count the taxes that middle-income Americans pay to support the massive government spending on health care programs.

Congress’s “market innovation” for pay-go is to fully fund the waste built into the private insurance model of health care financing, and pay for it out of the pockets of middle Americans who happen to need health care – defeating the very purpose of health care reform.

John Geyman is right. Single payer financing, a reformed Medicare for all, is precisely the pay-go solution that Congress desperately needs if reform is to accomplish the goal of making health care affordable for all. All we need is for President Obama to meet with Baucus, Kennedy, Dodd, Waxman, Reid, Pelosi and a few others to see who is going to give Karen Ignagni the bad news – bad news for her and her industry, but great news for America.

Insurance disruptions due to spousal Medicare transitions

Posted by on Monday, Jul 6, 2009

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.

Insurance Disruption due to Spousal Medicare Transitions: Implications for Access to Care and Health Care Utilization for Women Approaching Age 65

By Jessica R. Schumacher, Maureen A. Smith, Jinn-Ing Liou, Nancy Pandhi
June 2009

Objective: To assess whether a husband’s Medicare transition leads to insurance disruptions for his wife that impact her perceived access to care, health care utilization, or health status.

Principal Findings: After adjustment, women who experienced an insurance disruption due to their husband’s Medicare transition had a greater probability of experiencing a change in usual clinic/provider (71 percent), delaying filling or taking fewer medications than prescribed because of cost (75 percent), going to the emergency room (52 percent), and had lower average mental health scores than women who did not experience an insurance disruption.

Conclusions: Despite consistent insurance coverage, the insurance disruption that accompanies a spouse’s Medicare transition has adverse access and health care utilization consequences for women.

Most individuals experience a sense of relief on turning 65 because they know that they have the security of being covered by Medicare for the remainder of their lives. But that relief is often tempered by concerns over the transitional problem of having a wife who is not yet 65, but who experiences a disruption in her insurance because she had been covered as a dependent on her husband’s plan. This study demonstrates that such disruptions can have adverse consequences for health care.

How would the current reform proposals address this problem? Likely she would be mandated to purchase an individual plan through the insurance exchange, probably at a higher premium since plans would be allowed to use age as a factor in setting rates. This could be quite expensive just at a time that the couple is trying to pull together their financial plans for their retirement years. Also since almost all private health plans assess financial penalties for failure to use their contracted providers, she could lose the choice of continuing to use her current health care professionals. What would happen if she has a serious medical problem and has already initiated a complicated medical regimen (e.g., cancer chemotherapy, radiation, and staged surgery)?

Should Congress include in the reform legislation a measure that would cover the spouse under Medicare once the eligible individual turns 65? If so, should the taxpayers fund that coverage, even if the spouse is 32? If, instead, a premium is to be paid, would it be based on the actuarial value of a risk pool composed of high-cost retirees and individuals with long-term disabilities (i.e., the current Medicare program)? If the husband is leaving an employer-sponsored plan, would the former employer be required to continue the spouse’s coverage to avoid transitional disruptions? If so, who pays and how much?

We will always face these issues and many more as long as Congress insists that we are each mandated to finance our health care through our fragmented, dysfunctional, multi-payer insurance system.

All we really need to do is fix Medicare, and then make enrollment automatic for everyone. But then that would break the bond of trust that President Obama and the members of Congress have established with Karen Ignagni. That seems to be a much stronger bond than they have with the other 306 million of us.

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