Waxman ready to move – but where?

Posted by on Friday, Jan 30, 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.

Waxman to push ’09 health care reform

By Sean Lengell
The Washington Times
January 30, 2009

The top House lawmaker in charge of writing health care legislation said Thursday he is committed to passing a universal health care package by the end of the year…

“This is our time, we need to move forward, we need to get this job accomplished this year and get the bill to the president,” said House Energy and Commerce Committee Chairman Henry A. Waxman at a conference sponsored by Families USA…

“The economic times which are so difficult is another reason why we need to do it right away,” he told reporters after his speech. “The health of our economy depends on a great extent on our dealing with the health of our health care system.”

But Mr. Waxman said private insurers would play a significant role in the implementation of universal health coverage, adding that relying solely on a Canadian or European-style single-payer system is unrealistic in the United States.

“Reform in the health care system to achieve universal coverage has to come by building on the system that is in place – adjusting it, improving it to fill the gaps,” he said. “I believe we must have a significant role for private insurance, but I think it’s critically important that we have a public [health care] program alternative.”

http://www.washingtontimes.com/news/2009/jan/30/waxman-to-push-09-health-care-reform/

House Majority Whip James Clyburn (D-S.C.), obviously an insider, recently confused observers of the Washington scene by stating that health care reform would be incremental. This appeared to conflict with the position of other important players – Barack Obama, Tom Daschle, Ted Kennedy, Max Baucus, Pete Stark, amongst others – who have indicated that comprehensive reform would be as expeditious as possible – presumably this year or early 2010 at the very latest. The statement by Henry Waxman seems to confirm the fact that the House of Representatives is aligned with the Senate and The White House to move forward expeditiously with comprehensive reform.

They are also aligned on the position that single payer is unrealistic, and that reform will be based on private insurance. There is still confusion as to whether there is agreement that a public option must be a Medicare-like program, or if the public option would be satisfied by a pool of FEHBP-type private plans. The Republicans, AHIP, and the USCOC have said that the former is a non-starter, so the public option may well end up being just more private insurance in disguise.

If a U.S. model based on private plans were as effective as the Swiss and Dutch systems, it would still leave about 7,600,000 individuals without insurance, which certainly tests the definition of universal. With much higher health care spending in the United States, the premiums for private plans, even with generous subsidies, certainly would test the definition of affordability. U.S.-style private plans, designed to enhance business success by creating patient barriers to care and payment for care, certainly tests the definition of social insurance.

Maybe James Clyburn did let slip the dark secret of the Washington reformers. If we were to continue with only incremental reforms, we would end up with a system that will leave many without insurance, that will leave health care unaffordable for many more, and that will leave in place an industry that takes away health care access and choice to further its own financial interests. Hmmm… Looks like another con job. Go the incremental route, but call it universal.

Recession is good news for WellPoint

Posted by on Thursday, Jan 29, 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.

Recession Slows Medical Inflation, Helping Insurers

By Avram Goldstein
Bloomberg.com
January 28, 2009

The recession may restrain growth in medical expenses this year as fewer people visit doctors, buy drugs or have surgery, helping health insurers such as WellPoint Inc. safeguard profits, analysts said.

WellPoint, which covers one in nine Americans, rose the most in four weeks after reporting that medical expenses climbed less than 8 percent in the fourth quarter. The increase was at the low end of a forecast given in October, and the report sparked a rally for managed-care companies.

During an economic slump, people who are worried about costs hesitate to tend to their health needs because of out-of-pocket expenses. The U.S. entered a recession in December 2007, and the economy suffered the biggest job losses last year since the end of World War II.

“Many analysts, me included, think that the recession will lead to lower health-care utilization, which could benefit managed-care companies or at least help stabilize their margins,” said Matt Perry, an analyst with Wachovia Securities Inc., in a note to clients today.

WellPoint rose even though it reported a 61 percent drop in net earnings. Besides investment losses, WellPoint had 288,000 fewer customers, mostly because of job cuts by its clients. The easing in costs outweighed the loss of subscribers.

The insurers “have very thin margins, so margin expansion is much more important to earnings per share than changes in enrollment,” said Ana Gupte, an analyst with Sanford C. Bernstein & Co., in a telephone interview today. “Everyone is expecting the recession will moderate” policyholders’ use of benefits this year, she said.

The cost of living fell in the U.S. in December as the recession deepened, capping the smallest annual gain in a half century, according to Labor Department data released this month. Consumers’ medical-care prices rose 2.6 percent last year, compared with a 5.2 percent increase in 2007.

WellPoint forecast in October that medical-cost inflation, which affects the setting of premium rates, would range from 7.5 to 8.5 percent and that it could speed up in 2009. The company said it was raising 2009 prices to stay ahead of that trend.

“We’re not ready to declare the trend has slowed down, and we’ve maintained our higher pricing levels,” said Wayne DeVeydt, WellPoint’s chief financial officer, in a conference call today.

http://www.bloomberg.com/apps/news?pid=20601202&sid=aAeilLHULubY

Let’s see. It’s really good news that 288,000 people lost their WellPoint insurance primarily due to job cuts, because the resultant reduction in spending on health care “outweighed the loss of subscribers.” So the expanded profit margins made possible by paying for less health care “is much more important to earnings per share than changes in enrollment.”

More good news for WellPoint is that medical care prices rose only 2.6 percent last year. In a message to investors, WellPoint’s chief financial officer announced that, quite conveniently, they would not accept the government numbers as a “trend,” and go ahead with their plans to increase the premiums at over three times the rate of health care inflation.

The Democrats promised us comprehensive reform that would provide affordable health care for everyone. Yet they are crafting reform based on an industry that celebrates the loss of coverage for another quarter of a million people, and, at the same time, gouges the rest of their clients with outrageously excessive premium increases.

We have no greater ethical duty than to abandon this nefarious health care financing industry that defines good news as what works best for investors, and replace it with our own public financing system that strives for the good news of what works best for patients. After all, doesn’t that represent the ethics behind change you can believe in?

Uwe Reinhardt on comparing U.S. to Canada

Posted by on Wednesday, Jan 28, 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.

How the U.S. measures up to Canada’s health care system

Worldfocus
January 28, 2009

As part of Worldfocus’ Health of Nations signature series, correspondent Edie Magnus conducted this half-hour interview with Uwe Reinhardt on January 20, 2009, the day of President Barack Obama’s inauguration.

Edie Magnus: What do you think of Canada’s national health care system?

Uwe Reinhardt: I think it’s a high performer in the following sense: Canadians spend half as much per capita on health care as we do in the U.S., and yet if you go up there, sure you have to wait for some MRI image or for some heart procedures, but overall the system produces very good health outcomes. People are more satisfied there with their care than Americans are with theirs. So if you diagnosed it like a physician, you’d give that system an A and you’d have a hard time giving more than a B to ours.

Edie Magnus: Why do you think it is that most Americans don’t see it that way?

Uwe Reinhardt: Most Americans, first of all, are bombarded with propaganda. You don’t know how many think tanks are paid by certain industry — insurance, drug, organized medicine — to feed out negative stories about the Canadian health system. They do of course have mishaps, as do we, but there is a whole industry collecting them and beaming them out here. That is one.

Secondly, people are always more comfortable culturally with whatever they have than with some other system.

Third, people imagine having the worst illness, and if you are really very sick in the U.S., you generally do have more hope than in any other country if you are very sick, particularly if you are well insured. But if you sort of live the average life of Americans and have a Canadian system, they have better primary care, easier access to it. They would never go bankrupt over health care, because they don’t do that up there. They would realize what they are missing here.

Edie Magnus: We were in a hospital that was affiliated with McGill University, and it was a regional system that had six hospitals that were affiliated with one another, and they annually have some 39,000 inpatients, and they do about 34,000 surgeries and they deliver about 3,000 babies. And managing all of this is a staff of 12 people doing the billing, the administration. What would an equivalent hospital in the U.S. take to run administratively?

Uwe Reinhardt: You’d be talking 800, 900 people, just for the billing, with that many hospitals and being an academic health center. We were recently at a conference at Duke University and the president of Duke University, Bill Brody, said they are dealing with 700 distinct managed care contracts. Now think about this. When you deal with that many insurers you have to negotiate rates with each of them. In Baltimore, they are lucky. They have rate regulations, so they don’t have to do it. But take Duke University, for example, has more than 500,000 and I believe it’s 900 billing clerks for their system.

Edie Magnus: What are 800, 900 people doing?

Uwe Reinhardt: Well first of all there’s a contract. With each different managed care contract you have different rates. You have different things that need pre-authorization, not depending on the contract. You haggle over every bill. You submit the bill, the insurer rejects it, you haggle, and it may take 90 days to settle one bill. They don’t have that in Canada. You see, we spend in this country an enormous amount of money just administering claims. It’s a huge wrestling match over the payment.

Edie Magnus: When we pay a medical bill, how much of that bill goes to these kinds of administrative costs?

Uwe Reinhardt: Well, in general what you’ll find in our official statistics, we’re spending 7 percent on administration, but that only accounts for the insurers’ administrative costs and that includes Medicaid, which burns only two percent of its money throughput on administration. On the other hand, Medicare and Medicaid both cost the hospitals administrative costs that are booked as medical care, but it’s really administrative costs.

Steffie Woolhandler and David Himmelstein of Harvard did a study comparing Canada and the U.S. looking at what it costs employers, providers, doctors and hospitals and the insurance mechanism and compared Canada and the US, and they found that we in 1999, spent $300 billion on administration for all these three functions, and that was about 24 percent of national health spending there, but they say it was actually 31 percent because of the fraction of spending that they could actually identify and link to administrative costs. So they came to 31. So it’s somewhere between 25 and 30 percent that goes for administration and it doesn’t even include the patients’ time of billing. Anyone who has had anyone really sick in their family knows how much time you spend haggling over the bills and they have none of that in these systems.

Edie Magnus: I know that there’s some dispute about all those numbers, about what percentage of our spending the administrative costs represent, but you have said that with what America could be saving in administrative costs, that it could completely fund universal health care for all Americans.

Uwe Reinhardt: Oh yes, I’m totally convinced of that.

****

Edie Magnus: Would national health care work in the United States?

Uwe Reinhardt: Yes.

Edie Magnus: Would Canada’s plan work in the United States?

Uwe Reinhardt: Well, it works. We have a Canadian health plan in America. It’s called Medicare. It works. Don’t tell me Medicare doesn’t work. Tell that to the elderly. One way to test it is to say “Let’s take it away.”

Full transcript and video:
http://worldfocus.org/blog/2009/01/28/how-the-us-measures-up-to-canadas-health-care-system/3783/#comments

Save this link until you have 27 minutes to watch the complete video. It will be well worth your time.

"Managed consumerism"

Posted by on Tuesday, Jan 27, 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.

Consumer-Driven Health Care: Promise And Performance

by James C. Robinson and Paul B. Ginsburg
Health Affairs
January 27, 2009

This paper analyzes the evolution of consumer-driven health care in terms of its original vision, its subsequent implementation, and the transformations it has endured as it moves into its second decade. The market is generating product designs that combine elements of consumerism with elements of managed care, but the trend is always toward a stronger role for consumer choice and a weaker role for management of those choices by physicians, insurers, employers, and regulators.

Impact of the PPO

The insurance market has merged the ideas of consumer-driven health care with those of managed care instead of replacing the latter by the former. The dominant form of health insurance today, by far, is the PPO. It combines network principles from managed care with some of the cost-sharing principles from consumer-driven health care; in 2008, PPOs accounted for 58 percent of enrollment in employment-based coverage. The PPO began to displace the HMO in the late 1990s as HMOs’ gatekeeping and utilization review created too much consumer and provider animosity.

Despite the verbiage and vitriol on both sides, it appears that consumer-driven health care and managed care are complements more than they are substitutes for one another. The mainstream health insurance industry is reorienting itself to replace administrative controls with incentives and information but in a manner in which the health plan functions as an important intermediary for structuring choices and informing enrollees about provider price and quality.

A dilution of principles

The heart of the consumer-driven health plan is the philosophical belief that each individual should make his or her own health care decisions. Health care decisions should not be “managed” by third parties, and especially not by physicians and nurses employed by insurance companies. The consumer-driven health care movement has been obliged to dilute its principles in light of the overuse of inappropriate services and underuse of appropriate services in the real world. HDHPs now incorporate elements of disease management for enrollees with chronic conditions; case management for enrollees with complex or comorbid conditions; and utilization management for patients using particularly costly drugs, devices, or procedures. Most of these medical management programs are obtained from the same diversified insurers that offer HMO and PPO products.

Conclusions

As it moves further along the consumer pathway, health insurance is likely to strengthen rather than weaken some vestiges of its managed care heritage, especially the development of programs seeking to improve the care of enrollees along the spectrum from full health to dire illness. These include preventive and wellness programs for healthy enrollees, service coordination for patients needing acute care, disease management for enrollees with chronic conditions, and intensive case management for enrollees with severe conditions. These likely will be presented as options rather than mandates, consistent with the consumer-driven ethos, although perhaps with higher cost sharing for those who are eligible but choose not to participate. What is unclear, over the long term, is the extent to which more choice for consumers will prevent health insurers from being able to continue to offer the steep discounts they currently wrest from their provider networks.

The market continues to pioneer hybrid forms that incorporate elements of both managed care and of health care consumerism. We can name the emerging system “managed consumerism” or “facilitated consumerism,” or we can find some more felicitous phrase. The important point is that for choice to be meaningful, it has to be choice among meaningful options, and meaningful options need to be designed, built, and managed.

http://content.healthaffairs.org/cgi/content/abstract/hlthaff.28.2.w272v1

Managed care, consumer-driven health care, managed consumerism – these are just labels for a private insurance industry that has evolved from a role of indemnifying individuals and families against loss in the face of medical need, to an industry that has introduced innovative plan designs to enhance the success of its own business model.

Managed care was not designed to benefit patients. Its primary function was to enhance the business success of the insurers through provider contracting, limiting access and choice for the patients.

Consumer-driven health care was not designed to benefit patients. Its primary function was to enhance the business success of the insurers through the erection of financial barriers to health care, primarily through the use of high-deductible health plans.

The hybrid, “managed consumerism,” is not designed to benefit patients. Its primary function will be to continue to limit access and choice through provider contracting, and to continue to reduce access through the use of financial barriers to care.

These measures are designed to reduce spending by the insurers in order to keep their premiums affordable in a competitive market. For the insurers, the importance of consumers is simply that someone with enough money has to be there to purchase their products. Insurance products that take away choice and expose the ill to excessive costs are not the products that people want, but PPO/HDHPs are the predominant product that insurers offer.

Imagine if we had a single payer national health program – an improved Medicare for all. Would “managed care” even be a topic? Not when managed care has come to mean that individuals lose their choice by segregation of physicians and hospitals into plans to create an artificial market. Would “consumer-directed” health care be a topic? Not when consumer-directed care has come to mean that choosing to have the care that you need will cost you money out of your pocket that you may not have.

Tossing around labels and pretending that they represent solutions to our health care problems has got to go. No more con jobs with “managed consumerism.” It’s time to enact our own public system that simply pays our bills when we need health care – health care of our own choosing.

Journalism professor on reporting about Canadian health system

Posted by on Monday, Jan 26, 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.

Universal Health Care For Elephant, Mouse

By Gene Costain
Tampa Bay Online
January 26, 2009

Ben Jonson was a cantankerous, 17th century British dramatist who despised the early days of journalism because he thought it was overrun with propagandists and charlatans.

I’m no modern-day cynic, but the record of news coverage on universal health care has been rife with ideological cant and tall tales. In my view, journalists have formed a kind of parasitic osmosis with powerful interests that impairs robust debate.

My meager standing for wading in is that in the past 25 years I’ve lived half of that time in Canada and the other half here in the last Western refuge of commoditized medicine.

I have been making mental notes on the accumulated fallacies and misnomers about the Canadian universal system. Your neighbor to the north has always been a great case study, because the country is a near mirror image of America on many levels.

My first memory of family struggle over medical bills was in 1962, when my mother was about to give birth to the last of seven kids. The single-payer system – in which all health care providers bill a single entity – was still a few years away. Just before she went into the hospital to deliver, I overheard an anxious conversation she had with my father about how they were going to pay the anticipated $300 hospital bill. My working-class father supported us on a salary of $55 a week. Within a few years, that financial anxiety vanished, and all they had to deal with was a small plastic card, with the added bonus of virtually no paper trail.

My move to America in 1996 meant facing a small pile of bureaucratic paper before starting my doctorate in Tennessee. During my adult life in Canada, a little card was my official point of contact with the health care bureaucracy. Forget about annoying co-pays, a new concept for me. The relative wonder of it all captured my imagination, and for years I’ve been monitoring debates about the issue in a vain search for balance, especially as it relates to some of the good things you don’t hear about the Canadian system.

Let me frame this in a larger context. The late Canadian Prime Minister Pierre Trudeau said that living next door to America was like a mouse sleeping with an elephant. Canada has one-tenth of the U.S. population, and its citizens are largely resigned to (but secretly admire) the large American pachyderm. Despite the similarities, Americans have missed out on an honest depiction of what Canadians think about their system.

There is one key element in the Canadian story that Americans rarely hear about in their media. Polls show that Canadians would not trade their single-payer system for all the tea in Indonesia. Most Canadians say their health care is their most valued citizenship asset. That is not hyperbole: For years, Gallup polls have chronicled this high regard for the system. It makes you wonder why we don’t often get this view here – after all, there are plenty of Canadians sunning themselves in these parts.

One of the most persistent challenges is that there are long waiting lines for some services in Canada; my experience is that both systems are virtually indistinguishable. An informal consensus of family and friends in Canada, including my aging mother, is that the medial service is good to great. I have honestly not heard of one major medical service horror story.

But who is to blame for Americans not receiving these political, cultural and news representations? One reason is that journalists here are like reporters in other nations, they root around in their backyards for sources and social insight.

As the debate returns this year, we may get a more expansive rendering of the story because everyone agrees the system is broken. But it won’t happen unless more journalists, filmmakers and bloggers chip in with a more balanced rendering of this Byzantine story. It might make the cynical ghost of Ben Jonson happy.

(Gene Costain is a University of Tampa journalism professor.)

http://www2.tbo.com/content/2009/jan/24/co-universal-health-care-for-elephant-mouse/

And…

Health Care in Canada

Canadian Institute for Health Information
2008

Physician migration

Information on health care workers’ migrations into and out of Canada, and into and out of individual professions, is difficult to capture. However, data on physicians show that the number of physicians leaving and returning from abroad declined over the five years to the end of 2006, with those emigrating declining by more than half (56.9%) and those returning dropping by 18.2%. In the three years to the end of 2006, physicians returning to Canada outnumbered those who left.

Wait time

While it is difficult to compare jurisdictions’ progress in reducing wait times, it is possible to compare jurisdictions’ surgery rates in the priority areas. Overall, rates in these areas rose by 8% more than the expected increase from population growth and aging between 2004-2005 and 2006-2007.

Diagnostic imaging

Over the three years ended in 2006-2007, the number of MRI and CT exams in Canada rose by 42.9% (to 31.2 per 1,000 population) and 27.9% (to 103.3 per 1,000 population), respectively. During the same period, the increase in the number of exams was greater than in the number of scanners, for both MRI and CT. In the case of MRI, a 27% growth in the number of scanners led to a 47% growth in the number of exams. In the case of CT, a 12% growth in the number of scanners led to a 32% growth in the number of exams.

http://secure.cihi.ca/cihiweb/products/HCIC_2008_e.pdf

The data base that most of us use for our routine thoughts is that which is stored in our memories. When we have need for other information, we know that there are other resources to which we can turn, but for most of our rote activities, memory is presumed to be adequate and reliable.

Almost every resident of the United States can tell you several things about the Canadian health care system. The problem is that much of it is wrong.

How did it happen that our memories/knowledge of the Canadian system are so distorted? One of the more important reasons is that we have little exposure to the routine functioning of the Canadian health care system. It’s not that the information isn’t available. The Canadian Institute for Health Information is a highly credible resource for such information. You can learn quite a bit just by reading their 2008 report, Health Care in Canada.

So why hasn’t our media reported any of this information? Quite simply, it is boring. There is no mention of problems such as the number of uninsured, bankruptcy due to medical debt, or care denied because of the inability to pay for it, because those problems don’t even exist in Canada. The reports are of a system that is functioning well, but is not perfect, so measures that are being taken to improve their system are also reported. What U.S. journalist would waste their time with that, and which editor would approve it in the first place?

Another reason that our views are so distorted is that, for decades, several conservative and libertarian organizations opposed to public insurance have spoon fed the U.S. media with reports of problems in the Canadian system that happen to make good copy. Although those reports are often embellished, most do have a factual basis even if they don’t represent the mainstream functioning of their system. They are great fodder for our journalists who themselves have misperceptions about Canadian health care because they also are exposed to these highly selected, exceptional stories that do not include the boring stories of the routine.

A couple of examples of distortions were pulled out of the CIHI report. Everyone knows that physicians are fleeing Canada based on innumerable stories here, yet the reality is that more physicians are returning to Canada. Wait times for elective (not emergency) surgery have been an issue, but this report shows that the problem is being addressed with some success. The availability of diagnostic imaging also is improving significantly.

We hear stories of journalistic misbehavior, which are all too frequent, but they are not balanced with stories of the day in and day out routine of journalism. Responsible journalism is the norm in this nation, but we don’t hear much about it, thus our view of journalists may be inappropriately jaded. What journalists here often don’t realize is that, like most of the rest of us, their views of the Canadian health system are highly distorted by the selective reporting of others who are also driven by these same distortions that dwell in our cumulative memories.

Our thinking is based on what we know, but not on what we don’t know, and we won’t even know what it is that we don’t know unless our journalists start doing some more intensive research, even if it is very boring.

Gawande's pseudo-pragmatism

Posted by on Friday, Jan 23, 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.

Getting There from Here: How should Obama reform health care?

by Atul Gawande
The New Yorker
January 26, 2009

People fear the unintended consequences of drastic change, the blunt force of government. However terrible the system may seem, we all know that it could be worse — especially for those who already have dependable coverage and access to good doctors and hospitals.

Many would-be reformers hold that “true” reform must simply override those fears. They believe that a new system will be far better for most people, and that those who would hang on to the old do so out of either lack of imagination or narrow self-interest. On the left, then, single-payer enthusiasts argue that the only coherent solution is to end private health insurance and replace it with a national insurance program. And, on the right, the free marketeers argue that the only coherent solution is to end public insurance and employer-controlled health benefits so that we can all buy our own coverage and put market forces to work.

Neither side can stand the other. But both reserve special contempt for the pragmatists, who would build around the mess we have.

Every industrialized nation in the world except the United States has a national system that guarantees affordable health care for all its citizens. Nearly all have been popular and successful. But each has taken a drastically different form, and the reason has rarely been ideology. Rather, each country has built on its own history, however imperfect, unusual, and untidy.

Social scientists have a name for this pattern of evolution based on past experience. They call it “path-dependence.” Paul Krugman received a Nobel Prize in Economics in part for showing that trade patterns and the geographic location of industrial production are also path-dependent. The first firms to get established in a given industry, he pointed out, attract suppliers, skilled labor, specialized financing, and physical infrastructure. This entrenches local advantages that lead other firms producing similar goods to set up business in the same area — even if prices, taxes, and competition are stiffer.

Some people regard the path-dependence of our policies as evidence of weak leadership; we have, they charge, allowed our choices to be constrained by history and by vested interests. But that’s too simple. …consider a health-care example: the 2003 prescription-drug program for America’s elderly.

On January 1, 2006, the program went into effect nationwide. The result was chaos. There had been little realistic consideration of how millions of elderly people with cognitive difficulties, chronic illness, or limited English would manage to select the right plan for themselves. Even the savviest struggled to figure out how to navigate the choices: insurance companies offered 1,429 prescription-drug plans across the country. People arrived at their pharmacy only to discover that they needed an insurance card that hadn’t come, or that they hadn’t received pre-authorization for their drugs, or had switched to a plan that didn’t cover the drugs they took. Tens of thousands were unable to get their prescriptions filled, many for essential drugs like insulin, inhalers, and blood-pressure medications. The result was a public-health crisis in thirty-seven states, which had to provide emergency pharmacy payments for the frail. We will never know how many were harmed, but it is likely that the program killed people.

This is the trouble with the lure of the ideal. Over and over in the health-reform debate, one hears serious policy analysts say that the only genuine solution is to replace our health-care system (with a single-payer system, a free-market system, or whatever); anything else is a missed opportunity. But this is a siren song.

Yes, American health care is an appallingly patched-together ship, with rotting timbers, water leaking in, mercenaries on board, and fifteen per cent of the passengers thrown over the rails just to keep it afloat. But hundreds of millions of people depend on it. There is no dry-docking health care for a few months, or even for an afternoon, while we rebuild it. Grand plans admit no possibility of mistakes or failures, or the chance to learn from them. If we get things wrong, people will die. This doesn’t mean that ambitious reform is beyond us. But we have to start with what we have.

Massachusetts, where I live and work, recently became the first state to adopt a system of universal health coverage for its residents.

The results have been remarkable. After a year, 97.4 per cent of Massachusetts residents had coverage, and the remaining gap continues to close.

The Massachusetts plan didn’t do anything about medical costs, however, and, with layoffs accelerating, more people require subsidized care than the state predicted. Insurance premiums continue to rise here, just as they do elsewhere in the country. Many residents also complain that eight per cent of their income is too much to pay for health insurance, even though, on average, premiums amount to twice that much.

For years, about one in ten of my patients — I specialize in cancer surgery — had no insurance. Even though I’d waive my fee, they struggled to pay for their tests, medications, and hospital stay.

For the past year, I haven’t had a single Massachusetts patient who has had to ask how much the necessary tests will cost; not one who has told me he needed to put off his cancer operation until he found a job that provided insurance coverage.

It will be no utopia. People will still face co-payments and premiums. There may still be agonizing disputes over coverage for non-standard treatments. Whatever the system’s contours, we will still find it exasperating, even disappointing. We’re not going to get perfection. But we can have transformation — which is to say, a health-care system that works. And there are ways to get there that start from where we are.

http://www.newyorker.com/reporting/2009/01/26/090126fa_fact_gawande

Atul Gawande is a highly respected physician who has a well deserved reputation as a gifted writer. This commentary should not be construed as an attack on him; rather, it is an attack on his message. On his writing skills I give him an A, but on his content, a D-.

This article represents what I believe to be a misuse of framing. Gawande uses overly simplistic framing, but then bends, breaks or even replaces his frames as he develops his theme.

Gawande uses the linear polarity that I condemned in a recent qotd comment. In the four dimensional model that I described, he places single payer at one end of a linear polarity, free marketeers at the other end, and pragmatists in the middle.

His stated goal is a health care system that works, a goal that most of us share. Single payer is not only a financing system, but it is an administrative system that is specifically designed to make our health care system work for all of us. It is a system designed to address our problems not only in breadth, not only in depth, but throughout the three dimensions of all parameters, and over the fourth dimension of time. It is a system that is not “on the left” as he states, but, by design, it constitutes the health care universe in its four dimensions.

The free marketeers do not provide us with a universal system, but rather would disassemble much of what we have. They would have us each attend to our own needs, paying for whatever health care we need, or purchasing private health plans, even if the premiums alone are 16 percent of our income. No serious student of health policy would ever consider that to be a system that would work for all of us. At least Gawande is correct when he places the free marketeers out “on the right.”

What about the pragmatists? Of course, pragmatism is the theme of Gawande’s article. He cites path dependency as the natural model to achieve reform. Use what we have, and build on it to bring us closer to our goals.

But what is it that we do have? We have an expensive, dysfunctional health care delivery system that needs extensive repair along with adoption of efficiencies so that we can pay for it. Within the health care delivery system, we need to build on what is working, and replace that which isn’t.

But what else is it that we have? We have a health care financing system that is wasting tremendous resources, while impairing access to much needed health care, and exposing individuals to financial hardship or even financial ruin. Gawande’s major error in framing is that he conflates our health care delivery system with our health care financing, as if they were one and the same. Since we need to build on our existing delivery system, he includes as a given that building on our current fragmented financing system is an integral part of the process.

Look at the example that he gave us: the Medicare drug benefit. By the model of path dependency that he supports, drug coverage should have been added to Medicare as yet another benefit in the program, and it would have served us very well. Instead, it followed another path dependent road – our dependency on private health plans to cover prescription drugs. As Gawande states, this decision has likely killed people. Yet he insists that building on a financing system dependent on private insurers is essential because it’s path dependent.

He leaves us with an example of a successful application of path dependent reform – the Massachusetts “system of universal health coverage.” He glosses over the point that their system is not universal, although he does concede that the plan has done nothing to control costs, even though humane cost containment is an absolute imperative of any reform program.

But then it is hard to dispute Gawande’s perception that the Massachusetts plan is a success. After all, his surgical fees are being paid.

The pragmatic approach to financing reform is to follow a path dependent program that works, and discard those that don’t. With improvements, Medicare would work well for all of us; private health plans would work for those of us who are relatively healthy and have good incomes, like Dr. Gawande.

Current political status on reform

Posted by on Thursday, Jan 22, 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.

Great Expectations — The Obama Administration and Health Care Reform

By Jonathan Oberlander, Ph.D.
The New England Journal of Medicine
January 22, 2009

Health care reform is back. For the first time since 1993, momentum is building for policies that would move the United States toward universal health insurance. President Barack Obama has made health care a central part of his domestic agenda, and key members of Congress have promised to introduce ambitious health care reform legislation in 2009.

The lessons of 1993 and 1994 are also well understood in Congress. Two key Senators — Max Baucus (D-MT), chair of the Finance Committee, and Edward Kennedy (D-MA), chair of the Health, Education, Labor, and Pensions Committee — are developing legislation that largely tracks the Obama plan. Consequently, this time around, congressional Democrats may be more unified around a health care reform strategy. Baucus’s support for reform is crucial, given the importance of financing issues, and Kennedy’s staff has been holding meetings with stakeholders in an effort to build consensus. Both senators are determined to move quickly, fearing that delay could dissipate momentum, as it did in 1993.

Financing health care reform in this fiscal climate will be an extraordinary political challenge, deep divisions persist in Congress, and many thorny problems are nowhere near resolution. Throughout the past century, reformers pursuing comprehensive change in the U.S. health care system have failed to overcome similar barriers. But the fact that reform has failed before does not mean it is fated to fail forever. As the election of Barack Obama vividly reminds us, history is not always repeated. Sometimes it is made.

http://content.nejm.org/cgi/content/full/360/4/321

And…

Which Way to Universal Healthcare?

By Ezra Klein
In These Times
January 19, 2009

Ezra Klein: Your opening statements demonstrate a congruency in values, but obviously your approaches are different. It seems to me you each balance the politics and the policies of the issue differently. So, let me start with you, Steffie: How does single payer pass the Senate Finance Committee?

Steffie Woolhandler (PNHP): Well, you build a popular movement among the American people, much in the way that Obama was able to succeed by building a popular movement. If you’d asked me five years ago, what was more likely, passing single-payer or electing a black president, I probably would’ve said single-payer and you probably would’ve, too. But the thing that changed was a kind of populist sentiment in this country, and that’s what it’s going to take.

Ezra Klein: Richard, a lot of what you said today has been reliant on the idea of the public plan, but my congressional reporting suggests that one plausible outcome for your plan is that when you try to get to 60 votes in the Senate, the public plan gets bargained away. Is the public plan a bottom line? If the public plan vanishes, but the rest of the plan is structurally similar to your principles, is that a plan that’s beneath the level of acceptability? Is that a plan that therefore merits opposition?

Richard Kirsch (HCAN): We haven’t as a coalition had a discussion yet about how we look at this whole plan when it passes, and what’s acceptable and what is not.

We’re a long way policy-wise and politically — although maybe not that long on the calendar, potentially only nine or so months — of seeing something enacted. But we’re not there yet, so we’re just going to fight in every way for the best system that is achievable.

http://www.inthesetimes.com/article/4159/which_way_to_universal_healthcare/

Jonathan Oberlander is one of the nation’s more astute observers of the politics of health care reform. After a long dry spell of pessimism, he is finally able to justify a very cautious note of optimism, though it still risks being a fleeting message. The most reassuring component of his message is that Congressional Democrats, especially Sen. Baucus and Sen. Kennedy, are rapidly moving forward with comprehensive reform in a process designed to prevent as much as possible the errors of the past.

So the politics is in motion, but with which policies?

Although there is a growing populist sentiment for single payer reform, that has not translated into political action. Congress is moving forward with reform based primarily on covering more individuals with private health plans. Many of those supporting public insurance have decided that the politics require that we must follow the lead of the Washington politicians regardless of the Medicare-for-all populism. Thus they are pushing for a public insurance option in a market of private plans.

Ezra Klein is quite correct when he states that “my congressional reporting suggests that… when you try to get to 60 votes in the Senate, the public plan gets bargained away.” And what is the strategy to prevent this outcome? Richard Kirsch of the HCAN coalition states, “We haven’t as a coalition had a discussion yet…” and “We’re a long way policy-wise and politically…” and “we’re not there yet…”

The boat has left the dock and is leaving behind the better-than-Medicare option, and the HCAN coalition hasn’t solidified either the policies or the politics, other than to agree on abandoning single payer.

Is there any way that we can convert Medicare-for-all populism into political action? In his NEJM article, Professor Oberlander states, “Finally, in Barack Obama, health care reform has a president who could effectively use the bully pulpit to rally the public behind change.” Populism got President Obama to where he is. Can’t we take it one step further?

Commonwealth on the Swiss and Dutch systems

Posted by on Wednesday, Jan 21, 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.

The Swiss and Dutch Health Insurance Systems: Universal Coverage and Regulated Competitive Insurance Markets

By Robert E. Leu, Frans F. H. Rutten, Werner Brouwer, Pius Matter, and Christian Rütschi
The Commonwealth Fund
January 2009

Universal coverage attained through a mandate that every individual purchase a basic insurance plan

Building on a previous system of social and private insurance, the individual mandate in the Netherlands took effect in 2006. The Swiss have operated with a mandate since 1996. In both countries uninsured rates are low (estimated at about 1.5 percent of the population in the Netherlands and below 1 percent in Switzerland).

Enforcement of mandatory health insurance

Switzerland

On the other hand, some people who are nominally covered are not paying their premiums. Since 2005, insurers have been permitted to suspend payments on behalf of such people, meaning that providers are left with unpaid bills or consumers are denied services. These suspensions can last 8 to 24 months, because of the time it can take to ascertain whether a consumer is unable to pay the premium (in which case cantons or communities will often assume financial responsibility) or is simply unwilling to pay. About 120,000 people, or 1.6 percent of the population, were affected by suspensions in 2006.

Netherlands

Before the new Health Insurance Act, there was a fear that, despite the mandate, many individuals would opt not to obtain coverage. In fact, the number of uninsured at the end of 2006 was about the same as before the new mandate took effect — 241,000 people, or 1.5 percent of the population.

Almost an equal number of people — 240,000 as of the end of 2007 — were enrolled with an insurer but were not paying their premiums. Beginning July 1, 2007, insurers were allowed to expel enrollees who have not paid premiums, but these enrollees simply switched to other insurers and failed to pay them as well. To prevent this, the government has forbidden people from switching plans when they are behind in paying their premiums. There is also a proposal to allow garnishing of wages or unemployment or disability benefits.

http://www.commonwealthfund.org/usr_doc/Leu_swissdutchhltinssystems_1220.pdf?section=4039

The Commonwealth Fund is joining the chorus of those who say that we should look to the Swiss and Dutch systems as potential models for universal coverage in the United States. What is meant by universal coverage? It means that everyone is covered (except for the one percent or so who are not, and the one and one-half percent who have been suspended for failure to pay their premiums).

If we were to adopt a “universal” program that left about two and one-half percent without coverage, that means that about 7.5 million U.S. residents would be left out. The population of Switzerland just happens to be 7.5 million. Does anyone else see any irony in adopting a Swiss-like insurance system that would leave out the equivalent of the entire population of Switzerland? Perhaps some might argue that the Swiss population is more worthy of coverage than would be the 7.5 million that we would leave out.

This report is very supportive of the private insurance industry. The lead author, Robert E. Leu, Ph.D., serves as a director on the board of the largest private hospital group and a large health insurance company in Switzerland. Rate of coverage is only one of the many policy issues covered in a favorable light in this report. Those who have been following our national dialogue on health policy will recognize many other sections in this report that seem to be more intent on marketing their model to the United States than to caution us against the deficiencies in their systems.

Their faith in the social value of the private insurance industry is certainly noteworthy. For instance, when discussing the Swiss nonprofit plans for basic coverage, and for-profit plans for supplemental coverage, they state, “There may be synergies between the two lines — for example, in provider relations — and some insurers may use health information from basic coverage when deciding to whom to offer supplementary insurance (this is illegal but difficult to control).” Does isolating this statement parenthetically sterilize it, making it a fundamental business principle?

Private insurers, whether for-profit or nonprofit, are businesses. They will always advance innovations that enhance their business models. No matter how tightly they are regulated, they will engage in activities that are “illegal but difficult to control.” Of course, since not every potential loophole could possibly be covered by laws and regulations, some of the innovative, immoral business behaviors technically might not be illegal, even though they should be.

In a single payer public health program, everyone is covered for life, automatically, including the 7.5 million deemed less worthy (?) than all of the citizens of Switzerland. Not only that, we would also remove from our midst an expensive, superfluous industry that thrives on immoral or illegal (but difficult to control) business practices. Now really, isn’t single payer a better model for the United States?

Inaugural Address

Posted by on Tuesday, Jan 20, 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.

President Barack Obama

January 20, 2009

The question we ask today is not whether our government is too big or too small, but whether it works – whether it helps families find jobs at a decent wage, care they can afford, a retirement that is dignified. Where the answer is yes, we intend to move forward. Where the answer is no, programs will end. And those of us who manage the public’s dollars will be held to account – to spend wisely, reform bad habits, and do our business in the light of day – because only then can we restore the vital trust between a people and their government.

http://www.nytimes.com/2009/01/20/us/politics/20text-obama.html?pagewanted=all

Medicare vote, MLK and BHO

Posted by on Monday, Jan 19, 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.

H.R. 6675, The Social Security Amendments of 1965

Social Security Online
Legislative History

House of Representatives

Democrats
237 – Yea
48 – Nay
8 – Not Voting

Republicans
70 – Yea
68 – Nay
2 – Not Voting

Senate

Democrats
57 – Yea
7 – Nay
4- Not Voting

Republicans
13 – Yea
17 – Nay
2 – Not Voting

http://www.ssa.gov/history/tally65.html

As we reflect today on Martin Luther King’s gift to the nation, and on tomorrow’s historic inauguration, it seems fitting to look back at the vote that brought us Medicare. This was a vote for health care justice for our seniors, and a first step towards the dream, shared by Martin Luther King Jr then and Barack Obama now, of health care justice for all of us.

In 1965, the 57 Senate Democrats supporting the Medicare bill needed 10 Republicans to be able to invoke cloture if necessary. They received the support of 13 of the 32 Republicans. Opposition within the Democratic ranks was enough to prevent passage had these Republicans not supported the measure.

In 2009, to be able to invoke cloture the Democrats likely will need the support of one Republican plus one for each Democrat (or Independent) who breaks ranks, and that is out of 41 Republicans rather than 32.

Was passage of the Medicare bill feasible in 1965? It happened. Is comprehensive reform feasible now? Many contend that it is not because of the alleged increased polarization of politics.

Is it really true that Barack Obama has shifted from a liberal position to that of a moderate? Is it really true that he is going to try to govern from the middle while likely being frustrated in his efforts to bring about change because of the ability of either extreme to block the agenda of the other extreme?

Is all politics aligned along the bipolar linearity of the liberal/conservative agendas? Is Barack Obama actually positioning himself in the middle of this linear spectrum? Or is something else happening?

Using an analogy in geometry, points along a line are very confining and quite limiting in the realm of possibilities. If that line were rotated around a single point, the plane created certainly expands the possibilities, but is still very confining. Now imagine that plane being rotated around a linear axis to create three dimensions, not confined within a sphere, but extending toward infinity in all directions, with the added fourth dimension of time.

In this model, conservatism is at one point in a linear offshoot. Liberalism is at another point in a linear offshoot in the opposite direction. Moderates may think that they occupy the common meeting ground, but they are confined to a single point in the middle (think Blue Dogs).

Does this infinite four dimensional model represent the future to which Barack Obama is leading us? Is he discarding the old linear model that has caused so much harm and grief, and moving on to an all inclusive model that will work for all us us.

Maybe we are receiving a gift of a new start – a gift that Martin Luther King Jr would want us to have, and a gift that Barack Obama wishes to bring to us.

Today is a good day to take a mere six minutes of quality time to experience the hope that Americans are finally coming together:

Born Again American
http://www.bornagainamerican.org/


Correction and clarification of cloture vote

In 1965, when Medicare was enacted, cloture required two-thirds of those present and voting. My calculation was based on the assumption that the Democrats knew that they had only 57 votes, and would require 10 more if all Senators were present and voting. In fact, 10 did not vote so only 3 additional votes were required. Thus the Republican Senators actually gave them an extra margin of 10 votes (13 yea votes in total), but that could not have been known until the count revealed how many withheld their votes.

In 1975, the cloture rule was changed from two-thirds present and voting to three-fifths of those duly chosen and sworn. That fixes the number at 60 if all seats are filled.

In 2009, there are 56 Democrats duly chosen and sworn, plus Senators Sanders and Lieberman who usually vote with the Democrats. It is improbable that Norm Coleman’s challenge to Al Franken will be upheld, so the Democratic caucus will have 59 of the 60 votes required for cloture. Thus the Democrats will require 1 Republican to cross over, plus 1 more for each Senator that breaks ranks with the Democrats. (Obviously, 11 was in error – pure, simple klutz.)

Today’s message does not change. Let’s end the polarized divide and move on with an all inclusive model that will work for all of us. Let’s all become “Born Again Americans.” Martin Luther King Jr would want that, and tomorrow…

http://www.bornagainamerican.org/

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