AMA's Heal that Claim Month

Posted by on Thursday, Nov 6, 2008

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.

AMA wants physicians to stake a claim for accurate insurer payments this fall

AMA
October 29, 2008

As part of its national campaign to save the health system billions of dollars by improving the accuracy and efficiency of medical claims processing, the American Medical Association (AMA) today announced it has selected November for the first national Heal that Claim Month.

Many physician practices often experience an increase in claim denials from health insurers during the last quarter of the year, making November an ideal time to appeal inappropriately underpaid and denied claims. An estimated 90 percent of claim denials are preventable and 67 percent of denials are recoverable, according to the Advisory Board Company, a Washington-based research organization. Based on those estimates, physicians collectively lose billions of dollars a year of revenue to health insurers.

Heal that Claim Month is part of the AMA’s ongoing Heal the Claims Process campaign, which launched last June with the unveiling of the AMA’s first National Health Insurer Report Card, an objective comparison of the nation’s largest health insurers and their claims processing performance.

http://www.ama-assn.org/ama/pub/category/20209.html

And…

2008 National Health Insurer Report Card

AMA

Contracted payment rate adherence

On what percentage of records does the payer’s allowed amount equal the contracted payment rate?

Aetna – 70.78%
Anthem – 72.14%
CIGNA – 66.23%
Coventry – 86.74%
Health Net – not reported
Humana – 84.20%
UHC – 61.55%
Medicare – 98.12%

http://www.ama-assn.org/ama1/pub/upload/mm/368/reportcard.pdf

And…

Appeal that Claim

AMA

When a physician practice assumes that the reimbursement it receives from health insurers is always accurate, the practice may lose revenue. Even when a practice codes claims correctly, health insurers may still inappropriately deny, delay or significantly reduce payments. By implementing claims auditing processes, you can ensure that health insurers pay your practice appropriately for your physician procedures and services.

Step 1: Determine who will be responsible for auditing health insurer payments

Step 2: Collect recommended health insurer auditing resources

Step 3: Run monthly collection reports

Step 4: Review the health insurer explanation of benefits (EOB)/remittance advice (RA) on each claim identified on the collection report

Step 5: Identify the health insurer basis for the denied, delayed or partially paid claim

Step 6: Gather supporting documentation to corroborate reversal of the health insurer’s determination through the claims appeals process

Step 7: Develop a claim appeal letter and resubmit the claim to the health insurer

Step 8: Maintain a health insurer follow-up log

Step 9: Hold claims processing and review meetings

Step 10: Continue to appeal inappropriately denied, delayed or partially paid claims

Appeal that Claim (65 pages):
http://www.ama-assn.org/ama1/pub/upload/mm/368/appeal-that-claim.pdf

The AMA has selected November as the first national Heal that Claim Month. The problems that this addresses must be fairly significant if they are going to declare a special month to address them; so what are these problems?

The U.S. health care financing system is infamous for its profound administrative waste. Some of it is due to the fragmented system of a great multitude of private payers plus public programs with various rules and regulations which increase the complexity of the billing process. Besides the administrative costs of the insurers, which is typically about 18 percent of their premiums (i.e., medical loss ratio of 82 percent), the administrative burden that this system places on physicians and hospitals consumes about another 12 percent of the insurance premiums.

These numbers refer to the routine of claims preparation and processing. But the 2008 National Health Insurer Report Card demonstrates that the nefarious behavior of the private insurers has compounded the complexity by reimbursing at rates significantly below those that were established in contracts with the physicians.

The private insurers are cheating, and they depend on physicians being overwhelmed by this administrative burden to not get caught in their evil deeds. This goes far beyond the complex routine of private insurance administrative processes. This is racketeering.

In the ultimate of ironies, the AMA has responded with an additional, complex, burdensome administrative process to ferret out the private insurers that cheat (which is all of them!), so that they can demand reimbursement at rates that the insurers contractually agreed to. Understanding the element that they are dealing with, the final step recommended is to continue to assert compliance with these contracts agreed to by these recalcitrant crooks.

So what is the AMA recommendation for reforming this horrendous, highly wasteful system? More of it! They want to expand the market of private health plans and use our tax funds to provide credits for purchasing these plans.

The AMA should take a closer look at their own National Health Insurer Report Card. All of the private insurers are crooks, but our own public insurer, Medicare, has over a 98 percent compliance with contracted rates. Just imagine if Medicare were the only payer. The ease and transparency of the process would likely result in 99.99 percent compliance.

Instead of wasting more time and resources on a Heal that Claim Month, we need to proclaim January 2009 as a New and Improved Medicare for All Month!

Yes we can

Posted by on Wednesday, Nov 5, 2008

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.

November 4, 2008
Chicago, Illinois

President-elect Barack Obama:

America, we have come so far. We have seen so much. But there’s so much more to do. So tonight let us ask ourselves, if our children should live to see the next century, if my daughters should be so lucky to live as long as Ann Nixon Cooper, what change will they see? What progress will we have made?

This is our chance to answer that call. This is our moment. This is our time: to put our people back to work and open doors of opportunity for our kids; to restore prosperity and promote the cause of peace; to reclaim the American dream and reaffirm that fundamental truth that out of many, we are one; that while we breathe, we hope; and where we are met with cynicism and doubt and those who tell us we can’t, we will respond with that timeless creed that sums up the spirit of a people:

Yes, we can.

http://elections.nytimes.com/2008/results/president/speeches/obama-victory-speech.html

Yes we can!

UK halts cancer drug penalty

Posted by on Tuesday, Nov 4, 2008

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.

Terminally ill patients to get expensive new drugs on NHS

By Rebecca Smith
Telegraph.co.uk
November 4, 2008

The NHS drugs rationing body the National Institute of health and Clinical Excellence (NICE) will be more flexible in deciding whether drugs for patients at the end of their lives are cost effective.

The move is a victory for campaigners who have argued that it is cruel to deny patients a drug that may extend their lives long enough to see a grandchild born, a daughter’s wedding or the last Christmas with their family.

Currently expensive drugs that prolong life by a few months often breach the cost effective threshold used by Nice.

Some patients want to “top up” their care by paying for these drugs privately only then to be told they forfeit all of their NHS care and must pay for the entirety of their treatment. This is often more than they can afford.

In a fundamental shift in the health service, ministers will announce that patients will now be allowed to buy drugs privately without giving up the right to having the rest of their care paid for by the NHS.

Ministers will admit there will be no financial help for poorer patients who cannot afford to top-up their NHS care.

Critics have said allowing top-ups will create a two-tier NHS and undermine the founding principles that care should be provided irrespective of ability to pay.

http://www.telegraph.co.uk/news/newstopics/politics/health/3374318/Terminally-ill-patients-to-get-expensive-new-drugs-on-NHS.html

And UK’s private insurers move in:
http://www.telegraph.co.uk/finance/personalfinance/insurance/3378442/Victory-for-cancer-patients-as-NHS-ban-on-top-up-drugs-is-lifted.html

There have been many reports from the U.S. opponents of government health programs proclaiming that “life saving drugs are denied” for cancer patients in UK’s NHS. Generally, these are cancer drugs which had been evaluated by the National Institute of Health and Clinical Excellence (NICE) and found to have very little benefit, if any, especially when considering the high prices of these drugs.

The patients could still use the drugs, but they would have to pay for them. Because of the concern that this would create a two-tiered system within the public NHS program, it was decided that patients electing to use these drugs would have to switch to the private sector for their full care. Thus the claim that the government program “denies life saving drugs.”

The decision was reversed when it was decided that individuals obtaining their care through the NHS should not be required to leave the public program merely because, in their desperation, they wanted to be able to purchase expensive drugs of only marginal or questionable benefit.

Most would agree that the public program should cover all beneficial health care services. But should public funds be used to pay for expensive care that provides negligible value, or may even be detrimental? NICE tries to sort these out so that taxpayers are not having to foot the bill for technological and therapeutic excesses that don’t help and may harm.

The private insurance industry in the UK already has been providing supplementary coverage for health care. This coverage duplicates the services of the NHS, but because of higher reimbursement rates allows beneficiaries a greater choice of private care options, and allows them to move into the front of the queue. This has created an explicit two-tiered system in the UK, with underfunding and excessive waiting periods in the public sector. This is precisely why other nations such as Canada prohibit supplementary insurance.

On the other hand, complementary insurance is used to cover health care that is not provided by the public sector, such as drug benefits and foreign travel coverage for Canadians. This decision in the UK to allow non-covered private options for public NHS patients has opened up the market for complementary insurance in the UK, and the insurers are moving in.

The single payer model supported by PNHP would prohibit supplementary insurance, but would allow complementary insurance for services such as hospital suites or non-essential cosmetic surgery that taxpayers should not be required to finance.

The WHO has published an excellent report on private insurance and cost sharing (35 pages): What are the equity, efficiency, cost containment and choice implications of private health-care funding in western Europe?

http://www.euro.who.int/document/e83334.pdf

Choices in coverage during open enrollment

Posted by on Monday, Nov 3, 2008

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 insurance shoppers, be wise

By Bobby Caina Calvan
The Sacramento Bee
November 3, 2008

For those fortunate enough to have health insurance, let the head scratching begin (during open enrollment): Option 1 or Option 2? Routine, Choice or Select? PPO or HMO?

Experts say the year-end ritual is an oft-neglected process that deserves focused consideration from consumers, many of whom race through the insurance paperwork with utter terror.

Their decisions have far-reaching consequences.

“It can become a very expensive mistake if they go eenee, meenee, mynee, moe,” said Patricia Feathers, a customer service agent at Placer West Insurance Services in Lincoln. “Making the right choice means staving off bankruptcy and getting the right coverage.”

An ill-informed decision during open enrollment is usually locked in for a year, sometimes more.

But only one in 10 people express confidence in their understanding of their health coverage, according to another survey by the insurer CIGNA.

“When I talk to people, the problem over and over again is that people don’t have the knowledge they need to make an informed decision,” said Karen Kocher, CIGNA’s chief learning officer.

Employees often “default into their existing plans, opt for the cheapest plan, thinking they will save money in the long run.”

The better strategy, experts say, is to have a realistic assessment of health care needs, including an honest look at where health care dollars were spent in the previous year.

http://www.sacbee.com/101/story/1365091.html

What health insurance coverage will you need next year? Do you determine that by taking an honest look at where health care dollars were spent in the previous year? You are healthy, your health care spending has been negligible, so do you opt for the least expensive plan?

What about next year? Will you have a heart attack? Will you rupture an intracranial aneurysm and require prolonged rehabilitation services? Will you experience the onset of diabetes? Will an unpredictable accident result in extensive injuries, perhaps with permanent neurological impairment? Will you develop an autoimmune disease such as lupus? Multiple sclerosis? Will you develop cancer? If so, which cancer and how involved and protracted will the treatment program be?

Next year’s medical catastrophe, whether acute or chronic, can belong to any of us. That is why everyone of us requires a program that would enable us to access the health care that we need without having to face a financial catastrophe as well. That is a program that everyone would want, if they could afford it.

So why do 90 percent of people lack confidence in understanding their health coverage options? Well, they are confusing. None of the options offer full coverage for everything. All of them attempt to keep the premiums affordable by reducing what is covered. There are endless variations in lists of authorized providers, benefits covered, deductibles, co-payments, coinsurance, tiering, payment caps, and other features that are impossible to sort out when you don’t even know what your needs will be.

What they have in common is that they all decrease, to varying degrees, the security that your health care coverage will provide. You are asked to place a bet now. A larger wager will provide somewhat more security, but none of that wager can be recovered if you end up not needing medical care, which makes you pause before you select that option. (HSAs are not an exception since they are merely segregated savings accounts and not pooled-risk funds; someone else’s HSA would not pay your medical bills.) A smaller wager puts less of a crimp in your budget, but at the cost of losing the security of not being exposed to significant medical debt should the need for care arise.

When all of us want a plan that will provide us with the care that we need, when we need it, without having to face financial penalties for being sick or injured, we really need only one day of open enrollment: the day that we are born. That is the day that each of us would be enrolled in a single payer national health program that is open to all of us forever.

AMA position on single payer

Posted by on Friday, Oct 31, 2008

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.

Frequently asked questions about the AMA proposal for reform

American Medical Association
October 2008

Q: What are the basic principles of the AMA proposal?

A: The American Medical Association (AMA) proposes that individuals and families receive financial assistance to purchase a health plan of their choice, with more generous assistance to those with lower incomes. The financial assistance could take the form of tax credits or vouchers and must be earmarked for health insurance coverage. Health insurance market regulations should be reformed to establish fair “rules of the game” that protect vulnerable individuals, without unduly driving up premiums for the rest of the population.

Q: How is the AMA proposal different or better than a single-payer system?

A: Both the AMA and the single-payer approaches emphasize the same goal of universal coverage, but they differ on how to implement it. The AMA does not believe that full government control is a workable model for the United States. Single-payer systems are plagued with an undersupply of medical personnel, long waiting periods and a lack of patient choice. Alternatively, the AMA proposal seeks to enhance patient choice and encourage patients to be conscious of health insurance costs, while also maintaining innovation in the private sector.

http://www.voicefortheuninsured.org/pdf/08-1103-FAQ-Proposal.pdf

The AMA is trying. During this presidential election season, the AMA has initiated an intensive “Voice for the Uninsured” campaign in support of their model of reform. Unfortunately, the policies behind their version of reform would fall far short of achieving the goal of affordable, comprehensive health care for everyone. Their feeble and deceptive effort to explain why their proposal is better than single payer reveals the fact that that the AMA is still controlled by those ideologically opposed to a national health program.

One of their basic principles is that “insurance market regulations should be reformed to establish fair ‘rules of the game’ that protect vulnerable individuals, without unduly driving up premiums for the rest of the population.” Presumably insurance market regulations that protect vulnerable individuals would mean that plans must prevent financial hardship for those who need health care. Even the average employer-sponsored family plan (at $12,600) may not be adequate because of deductibles and other cost sharing requirements. To be effective in protecting personal finances, these plans must be quite comprehensive and will require very high premiums.

Yet the AMA states that these plans must not unduly drive up premiums for the rest of the population. That is an impossibility. The only way you can keep premiums low is to segregate the healthy in isolated risk pools (but then these pools wouldn’t work for those who end up needing medical care because of the high cost sharing used to keep the premiums low). If you were to isolate those with high medical expenses in pools providing comprehensive coverage, the premiums would be so high that the many who are healthy would have to finance most of the costs.

Of course that is why the AMA has recommended taxpayer financed subsidies to help pay those premiums. But how could you ever make that equitable? Imagine the complexities of setting premiums in a fragmented system of unstable and inequitable risk pools, and then providing tax subsidies (credits or vouchers) that would vary with ever changing income levels. And for that we would continue to accept private insurance plans that burn up hundreds of billions of dollars in administrative waste, while remaining incapable of directing our health care dollars to where they would do the most good. Supporting a model with excess costs and greater inefficiency doesn’t make sense.

Regarding single payer, the AMA labels that as “full government control.” It is hard to know what that means when the health care delivery system remains private. About sixty percent of our health care is already financed through taxes. Single payer systems typically finance about seventy percent (though more would improve efficiency). “Full government control” is merely intended as a pejorative label that has little policy application. That label could backfire on the AMA since many Americans are now concerned that the government has not been doing enough.

The AMA states that single payer systems are “plagued with an undersupply of medical personnel.” Massachusetts has a program not unlike that supported by the AMA. Tell the people of Massachusetts that the primary care physicians that they can’t find are really there in great supply. Tell the patients behind the curtains in the upstairs hallways that we don’t have an undersupply of safety-net beds. Tell the patients on Medicaid or in Community Health Centers that we don’t have an undersupply of willing specialists. Tell the ambulance drivers who are waved past full emergency departments that we don’t have an undersupply of emergency facilities. The fact is that publicly administered programs are more capable of identifying needs and redirecting resources to where they would do the most good.

The AMA says that single payer systems cause long waiting periods. Tell that to the tens of millions of individuals in the United States who are not even allowed a place in the queue. Tell that to insured patients who may have to wait months for an appointment with a specialist. Tell that to the authors of the OECD report which demonstrated that many nations with public systems have been successful in reducing and even preventing excessive queues.

The AMA says that single payer systems cause a lack of patient choice. What does that mean? Most private insurance plans have restricted lists that take away our choice of hospitals, physicians, and other health care professionals. A single payer system gives you this free choice within the health care delivery system. Does the AMA mean a lack of choice of health plans? The only plan that you really want is a plan that allows you to access health care without being assessed a financial penalty for having health problems. Most private health plans do not do that, but a single payer system does.

The AMA states that their proposal, unlike single payer, encourages patients to be “conscious of health insurance costs.” If you look at our individual insurance market where people select their plans based on the amount of the premium, it’s easy to understand what a flawed concept this is. We have had an explosion in innovative underinsurance plans that have left patients with major medical debt, home foreclosures, and even personal bankruptcy. These people are certainly “conscious” of the financial hardship that the private plans exposed them to.

I’m the first to admit that the “Voice for the Uninsured” campaign offers real hope that the AMA has had an epiphany. But that hope will be dashed once again unless the AMA backs up their campaign with sound health policy science.

Medical tourism causes complications

Posted by on Thursday, Oct 30, 2008

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.

Medical Tourism Causes Complications

By Christina L. Madden
Carnegie Council
Policy Innovations
October 27, 2008

Approximately 750,000 Americans traveled overseas for medical treatment in 2007, and the number of so-called medical tourists could increase to more than 15 million in 2017.

Overall the effects of medical tourism are mixed. On the one hand, the industry can boost a developing country’s gross domestic product and investment in health facilities. Upgrades in a country’s hospitals also tend to decrease external brain drain, as top physicians find local jobs instead of leaving for employment in developed nations.

In many cases, however, medical tourism threatens to exacerbate unequal access to quality health care in developing countries. Although relatively cheap by most Western standards, the private hospitals that treat foreigners are out of reach for the majority of people, and the revenue they bring in rarely makes its way to the public sector.

External brain drain is often replaced by internal brain drain, as doctors leave public health care centers to work in private hospitals.

Medical tourism is not an alternative to significant reform of the U.S. health care industry. Aside from the negative effects on public health overseas… medical tourism is not predicted to reduce the country’s health spending by more than 1 to 2 percent.

By introducing global competition to an industry that’s long been considered immune to outsourcing, medical tourism may up the ante on reforming coverage, cost, and quality at home.

http://www.policyinnovations.org/ideas/briefings/data/000083

Previous studies have shown that one of the reasons that health care is so expensive in the United States is that, quite simply, our prices are very high. Since other nations have been demonstrated to be capable of selectively providing high quality care at much lower prices, it is not surprising that medical tourism has become an attractive option for those paying the bills, including cash-paying patients, some insurers and some employers.

For those who believe that health care financing should be a function of markets, medical tourism would have a prominent place in the menu of options. For those who believe that health care systems should provide everyone with the best options available in an egalitarian system, both for us in the United States and for the people of other nations, medical tourism is a troublesome development.

As this article describes, medical tourism is further impairing public health programs in developing nations. In our quest for a high performance system in the United States, we must be very careful to avoid the unintended consequence of inflicting damage on the health systems of other nations.

The World Health Report 2008

Posted by on Wednesday, Oct 29, 2008

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.

Primary Health Care – Now More Than Ever

World Health Organization
October 14, 2008

The World Health Report 2008 critically assesses the way that health care is organized, financed, and delivered in rich and poor countries around the world. The WHO report documents a number of failures and shortcomings that have left the health status of different populations, both within and between countries, dangerously out of balance.

Inequities in access to care and in health outcomes are usually greatest in cases where health is treated as a commodity and care is driven by profitability. The results are predictable: unnecessary tests and procedures, more frequent and longer hospital stays, higher overall costs, and exclusion of people who cannot pay.

To steer health systems towards better performance, the report calls for a return to primary health care (PHC), a holistic approach to health care formally launched 30 years ago. When countries at the same level of economic development are compared, those where health care is organized around the tenets of primary health care produce a higher level of heath for the same investment.

This report structures the PHC reforms in four groups that reflect the convergence between the evidence on what is needed for an effective response to the health challenges of today’s world, the values of equity, solidarity and social justice that drive the PHC movement, and the growing expectations of the population in modernizing societies: reforms that ensure

  • that health systems contribute to health equity, social justice and the end of exclusion, primarily by moving towards universal access and social health protection — UNIVERSAL COVERAGE REFORMS;
  • reforms that reorganize health services as primary care, i.e. around people’s needs and expectations, so as to make them more socially relevant and more responsive to the changing world while producing better outcomes — SERVICE DELIVERY REFORMS;
  • reforms that secure healthier communities, by integrating public health actions with primary care and by pursuing healthy public policies across sectors — PUBLIC POLICY REFORMS;
  • reforms that replace disproportionate reliance on command and control on one hand, and laissez-faire disengagement of the state on the other, by the inclusive, participatory, negotiation-based leadership required by the complexity of contemporary health systems — LEADERSHIP REFORMS.

In high-expenditure health economies, which is the case of most high-income countries, there is ample financial room to accelerate the shift from tertiary to primary care, create a healthier policy environment and complement a well-established universal coverage system with targeted measures to reduce exclusion.

Even in the United States, its exceptionalism stems not from lower public expenditure… but from its singularly high additional private expenditure. The persistent under-performance of the United States health sector across domains of health outcomes, quality, access, efficiency and equity, explains opinion polls that show increasing consensus of the notion of government intervention to secure more equitable access to essential health care.

http://www.who.int/mediacentre/news/releases/2008/pr38/en/index.html

Primary Health Care – Now More Than Ever (148 page PDF):
http://www.who.int/whr/2008/whr08_en.pdf

The World Health Report 2008 provides a critical assessment of health care systems throughout the world. It describes how all nations, regardless of national wealth, can benefit by enacting reforms organized around primary health care.

In reading the various experiences of other nations, it is almost shocking to see how infrequently the most expensive health system of all, that of the United States, is mentioned as an example of how reform can work. But then it is understandable when other nations single our system out for its exceptionalism – a system with “singularly high additional private expenditure” that persistently underperforms “across domains of health outcomes, quality, access, efficiency and equity.”

For a proper perspective of what we do have and what we could have, this report should be required reading.

California's high-risk pool is sick

Posted by on Tuesday, Oct 28, 2008

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.

California high-risk pool for medically uninsurable helps fewer residents

By Jordan Rau
Los Angeles Times
October 28, 2008

California… is one of 35 states that arranges health coverage for people rejected by commercial companies because they have blemished medical histories.

This group — known as “medically uninsurable” — accounts for about an eighth of the 5 million Californians who lack health insurance. Most are self-employed, work for companies that don’t provide insurance or don’t have a job.

But California’s publicly subsidized high-risk pool, long one of the least generous in the country, has atrophied over the tenure of Gov. Arnold Schwarzenegger — even as the governor put the plight of the uninsured at the top of his political agenda.

Rising premiums and limited subsidies have made the Major Risk Medical Insurance Program either unaffordable, unavailable or ineffective for many of those who most need health insurance.

The program now covers about 13,000 Californians — about 2% of the medically uninsurable.

Enrollment has dropped by almost a third since Schwarzenegger became governor.

Subscribers pay two-thirds of the pool’s cost and the state about one-third. The insurers that voluntarily participate — primarily Blue Cross of California and Kaiser Permanente — break even.

Unlike most other states, which finance their programs either directly with tax dollars or with assessments on insurers, California’s subsidies have come only from the state’s tobacco tax.

Lawmakers have kept annual financing at or below $40 million a year, requiring the pool’s administrators to cap its enrollment.

One of the major obstacles is the cost of premiums, which the law sets at 125% of commercial insurance rates. More than a third of pool participants who dropped out this year told the pool’s administrators that they couldn’t afford it anymore.

Despite its cost, California’s high-risk pool is of limited use for people needing extensive medical care, such as those with cancer or chronic diseases. That is because the pool’s benefits are capped at $75,000 a year, lower than the limits of any other state’s pool.

To fix California’s pool, the Legislature this year proposed placing a $1 monthly per customer fee on insurers that sell policies directly to customers.

But in his veto message, Schwarzenegger said the fee would be passed on to customers and thus “only exacerbates their burden.”

http://www.latimes.com/news/local/la-me-uninsured28-2008oct28,0,7559850,full.story

The concept of health insurance is quite simple. When everyone pays into an insurance risk pool, the many who are healthy are subsidizing the higher costs of those with greater health care needs. Thus everyone receives whatever medical care they need without facing financial barriers to care.

Then why do we have high-risk pools? The simple answer is that health care has become so expensive that premiums for universal pools would be so high that few could afford them. So we move higher cost individuals into high-risk pools in order to keep premiums more affordable for pools of healthy individuals.

Think about the premium for a family in an employer-sponsored pool composed of the healthy workforce and their young healthy families; it now averages $12,600. If we were to add into these pools many hundreds of thousands of individuals with high health care costs, you can only imagine how high the premiums would go.

Although California has set the high-risk pool premium at 125 percent of commercial rates, they have had to cap the benefits at $75,000 to avoid yet higher premiums. Sorry, but for this high cost group, that falls far short of the insurance function of preventing financial hardship in the face of medical need. For adequate benefits, the premiums for high-risk pools would be unaffordable for all but the very wealthiest of us, as if they weren’t too high already.

If we expect to cover high-risk individuals, we do need a transfer from the healthy to the sick. California attempted to take a very small step in this direction by assessing fees on insurance plans in the individual market that would be used to help fund the high-risk pool. But Gov. Schwarzenegger didn’t want to “exacerbate the burden” on the healthy by expecting them to help fund care for the sick. Then who funds the high-risk pool?

We really need to end this game of juggling unaffordable premiums amongst fragmented, inequitable risk pools. It’s time to establish one single risk pool for all of us, and fund it equitably through progressive taxes. The private plans get in our way. We need to dump them.

U.S. rationing eliminated by hallway admissions

Posted by on Monday, Oct 27, 2008

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.

‘Hallway medicine’ seen as a way to unclutter ERs

By Carla K. Johnson
Houston Chronicle/AP
October 26, 2008

It may not sound like ideal health care, but hospital officials nationwide are being urged to consider hallway medicine as a way to ease emergency department crowding, and some are trying it.

Leading the way is Stony Brook University Medical Center at Stony Brook, N.Y., where a study found that no harm was caused by moving emergency room patients to upper-floor hallways when they were ready for admission.

Holding patients in ERs can cause deaths, doctors say. In a 2007 survey of nearly 1,500 emergency doctors, 13 percent said they personally experienced a patient dying as a result of boarding in the emergency department. The survey was conducted by the American College of Emergency Physicians.

The new study found slightly fewer deaths and intensive care unit admissions in the hallway patients, compared with the standard bed patients. That was no surprise… because the protocol calls for giving the first available rooms to the sickest patients. Intensive care patients never go to hallways.

http://www.chron.com/disp/story.mpl/health/6079406.html

The United States has 2.9 hospital beds per 1000 individuals. The median number of beds for OECD nations is 3.7 (OECD, 2002). Not only do we have fewer beds, the distribution is less even than in other nations with their more egalitarian systems. The supply of beds tends to be quite adequate in affluent regions, but is inadequate in other areas, especially those served by safety-net institutions.

In many hospitals, emergency departments have had to accept queues in “holding” – patients who have been admitted but for whom there are no beds available on the hospital floors. When the holding area is full, it has been common practice to admit patients to the hallways of the various services, not as policy but as a temporary inconvenience. The significance of this study is that hallway admissions now are being recommended as explicit hospital policy.

Hospitals also need policies to provide surge capacity – the ability to admit much larger numbers of patients in the event of major epidemics or catastrophic events. Can you imagine how these hospitals would respond to such a surge in patients? Not very well.

How is it that we have lower capacity and worse distribution of our hospital beds than do other nations that spend much less on health care than we do? Quite simply, they use equitable, egalitarian systems for health care financing and health system planning. Of course, this is code language for stating that they depend on government involvement in their financing and health system planning.

Other nations do sometimes have queues, especially for less urgent problems, often labeled as rationing. So their systems are not perfect. Some merely need to spend more money, and others need to replace their public stewards with individuals who have more egalitarian values.

In the United States, we spend more than enough money, primarily on those with the means to pay, and they get good care (except for an excess of detrimental high-tech services).

In contrast, for less affluent individuals, we do not even supply them with enough beds. But at least we don’t ration. We merely hide them behind the curtains in the upstairs hallways.

Sen. Kennedy's grand finale

Posted by on Friday, Oct 24, 2008

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.

Kennedy secretly crafts health care plan

By Jeffrey H. Birnbaum
The Wilmington Times
October 24, 2008

From his sickbed, Sen. Edward M. Kennedy has secretly been orchestrating meetings with lobbyists and lawmakers from both parties to craft legislation that would greet the new president with a plan to provide affordable medical coverage to all Americans, a measure he has called “the cause of my life.”

Among those who are receptive to a bipartisan plan and who have participated in the initial talks is Sen. Michael B. Enzi of Wyoming, the ranking Republican on the Senate health committee, which Mr. Kennedy leads.

Mr. Kennedy’s goal, his aides say, is to introduce a universal health care bill as soon as the new Congress convenes next year and to push quickly for its passage – a much-accelerated timetable compared with the last time that a health care overhaul was on the agenda, at the start of the Clinton administration.

The wide-ranging talks have taken place behind closed doors on Capitol Hill and have been monitored by Mr. Kennedy through daily telephone updates from his staff, said his aides and several participants.

The discussions, which started in June, included 14 roundtable meetings in the Dirksen Senate Office Building. These were attended not only by Kennedy aides but also by staffers, both Republicans and Democrats, from the Senate committees with jurisdiction over health care. Those include the Budget Committee, the Finance Committee and the committee that Mr. Kennedy leads, the Committee on Health, Education, Labor and Pensions.

Also attending was the entire panoply of interest groups with stakes in the cost and availability of health coverage. These included the AFL-CIO, the Business Roundtable, the U.S. Chamber of Commerce, the National Federation of Independent Business, the National Retail Federation, the Federation of American Hospitals, the American Medical Association, America’s Health Insurance Plans, Families USA, AARP and the Consumers Union.

The talks have managed to put in the same room interests that rarely meet – let alone agree with one another. No one is under the illusion that finding a compromise will be easy. Indeed, it remains unclear that a long-elusive consensus can be found. Participants agree, however, that Mr. Kennedy’s active role – particularly during his convalescence – have increased the likelihood of a breakthrough.

http://www.washingtontimes.com/news/2008/oct/24/kennedy-secretly-crafts-health-care-plan/

Everyone has profound admiration for Sen. Edward Kennedy’s valiant effort to finally overcome the stubborn political barriers, and bring health care to everyone in the nation. At a time that the people are demanding reform, Sen. Kennedy is positioned to provide us with his grand finale – and what a great one that would be – health care for everyone.

But what a task he has. He is working with individuals and organizations that have rigid policy positions, which they demand be a part of any reform package. Many of these positions are absolutely incompatible with each other and could never be incorporated together in a legislative package. Most of these policy positions represent either special interests or simple ideology.

If this process is to work, all of these interests will have agree to policies that place the interests of patients above all else. The goal must be to establish a system in which everyone can receive all necessary health care without the necessity of facing financial hardship. We know how to do this. The policies are easy; the politics aren’t.

We pray that Sen. Kennedy can produce a grand finale in which all special interests realign themselves to support the only interest that really matters – the American patient.

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