Trump’s abrupt termination of cost-sharing reductions

Posted by on Friday, Oct 13, 2017

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.

Trump Administration Takes Action to Abide by the Law and Constitution, Discontinue CSR Payments

U.S. Department of Health & Human Services, October 12, 2017

U.S. Health and Human Services Acting Secretary Eric Hargan and Centers for Medicare & Medicaid Services Administrator Seema Verma released the following statement announcing that cost-sharing reductions payments will be discontinued immediately based on a legal opinion from the Attorney General:

“It has been clear for many years that Obamacare is bad policy.  It is also bad law. The Obama Administration unfortunately went ahead and made CSR payments to insurance companies after requesting – but never ultimately receiving – an appropriation from Congress as required by law.  In 2014, the House of Representatives was forced to sue the previous Administration to stop this unconstitutional executive action. In 2016, a federal court ruled that the Administration had circumvented the appropriations process, and was unlawfully using unappropriated money to fund reimbursements due to insurers.  After a thorough legal review by HHS, Treasury, OMB, and an opinion from the Attorney General, we believe that the last Administration overstepped the legal boundaries drawn by our Constitution.  Congress has not appropriated money for CSRs, and we will discontinue these payments immediately.”…

HHS Memo with opinion of Attorney General Jefferson B. Sessions III:…

CBO: The Effects of Terminating Payments for Cost-Sharing Reductions:…

NYT: 12 ways Trump is scaling back Obamacare:…


Executive Order: Promoting Healthcare Choice and Competition Across the United States

The White House, October 12, 2017

Among the myriad areas where current regulations limit choice and competition, my Administration will prioritize three areas for improvement in the near term: association health plans (AHPs), short-term, limited-duration insurance (STLDI), and health reimbursement arrangements (HRAs).…

In order to make health care more affordable for lower-income individuals, the Affordable Care Act required that credits (cost-sharing reductions or CSR) be paid to the insurers to cover a portion of the cost sharing. Republicans chose to block these payments by refusing to appropriate the funds required, forcing the Obama administration to use an alternative source of funds – a move which is now under legal challenge (use link above to see Attorney General Sessions’ opinion).

The Trump administration has now ordered the immediate termination of the CSR payments.

The Congressional Budget Office has previously provided an analysis of the consequences of terminating the CSR payments (see link above). There are too many variables to predict with certainty what will happen, but the action at least is likely to be disruptive to the silver plans offered in the exchanges (the silver plans being the ones that quality for the CSR payments).

Also yesterday President Trump issued an Executive Order instructing agencies to modify regulations for association health plans (AHPs), short-term, limited-duration insurance (STLDI), and health reimbursement arrangements (HRAs). Again, because of variables in implementation of this executive order, the impact is uncertain, but it is likely to be quite negative.

The New York Times has listed other ways in which Trump’s administration is scaling back the Affordable Care Act (see link above). All of these measures together will certainly increase the number of uninsured, reduce health care benefits covered by the innovative plans, while increasing exposure to financial risk. Too many patients will end up sicker and poorer.

At a time when there is a surge of interest in single payer reform – an improved Medicare for all – the pushback against the Trump chicanery could expedite the political processes required to advance health care justice to all. We should be sure that the nation understands that there is a much better way out, but also that they will have to demand that change.

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Posted by on Thursday, Oct 12, 2017

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.

Death by Gun Violence — A Public Health Crisis

By Howard Bauchner, MD (1); Frederick P. Rivara, MD, MPH (2); Robert O. Bonow, MD, MS (3); Neil M. Bressler, MD (4); Mary L. (Nora) Disis, MD (5); Stephan Heckers, MD (6); S. Andrew Josephson, MD (7); Melina R. Kibbe, MD (8); Jay F. Piccirillo, MD (9); Rita F. Redberg, MD, MSc (10); John S. Rhee, MD, MPH (11); June K. Robinson, MD (12)
JAMA (Published simultaneously in JAMA and the 11 JAMA Network Journals), October 9, 2017

Author Affiliations:

1) Editor in Chief, JAMA and The JAMA Network
2) Editor, JAMA Pediatrics and JAMA Network Open
3) Editor, JAMA Cardiology
4) Editor, JAMA Ophthalmology
5) Editor, JAMA Oncology
6) Editor, JAMA Psychiatry
7) Editor, JAMA Neurology
8) Editor, JAMA Surgery
9) Editor, JAMA Otolaryngology–Head & Neck Surgery
10) Editor, JAMA Internal Medicine
11) Editor, JAMA Facial Plastic Surgery
12) Editor, JAMA Dermatology

The shooting in Las Vegas, Nevada, that left 59 people dead, 10 times that number wounded, and thousands of people with the psychological distress from being present at the scene during and after the massacre has once again raised the issue of what we as a nation can and should do about guns. The solution lies in not just focusing on Las Vegas and the hundreds of other mass shootings that have occurred in the United States in the last 14 months, but rather to underscore that on average almost 100 people die each day in the United States from gun violence. The 36,252 deaths from firearms in the United States in 2015 exceeded the number of deaths from motor vehicle traffic crashes that year (36,161). That same year, the US Centers for Disease Control and Prevention reported that 5 people died from terrorism. Since 1968, more individuals in the United States have died from gun violence than in battle during all the wars the country has fought since its inception.

Guns do not make individuals, their families, or homes safer and they result in far more deaths to loved ones than to an intruder intending to cause harm. Often forgotten is that 60.7% of the gun deaths in 2015 in the United States were suicides. Means used to attempt suicide matter; guns will result in suicidal deaths well over 90% of the time, whereas ingestion of pills or wrist cutting will be unsuccessful more than 90% of the time. The majority of people who try to commit suicide but survive the attempt will not go on to die from suicide; if the attempt is with a gun, there will be no second chance at life.

The journals of the JAMA Network are dedicated to improving the health of people across the globe. We do so by addressing the most important public health problems harming people and publishing the best science that can be done. The journals have published important work on gun violence; in the past year this has included studies on differences in gun use during terrorist attacks in the United States compared with other countries, the effect of exposure to gun violence in the media on children’s interest in real guns, the relationship between firearm laws and firearm homicides and suicides, and the association of “stand your ground” laws with homicide and suicide. Research on gun violence is important, although Congress over the last 2 decades has placed limits on that science from being conducted. This attempt to suppress research into gun violence resulted in a 64% decline in the number of firearm studies per million citations in SCOPUS between 1998 and 2012.

Physicians and other health care professionals can do more. The US Court of Appeals for the 11th Circuit has ruled that attempts to prevent physicians from asking and counseling patients about guns violate the First Amendment. As with any epidemic, prevention is important. Physicians and others should ask about guns in the home, especially for high-risk patients, and advise about removal and safe storage. Good evidence has shown that safe storage of firearms is effective in reducing misuse. Physicians can conduct appropriate screening and early intervention for suicide, the most common cause of gun deaths.

We, as editors of the journals in the JAMA Network, are committed to providing policy makers, as well as the medical community and the US public, with accurate, timely information to guide interventions that will reduce injuries and deaths from guns. Numerous polls have shown that the majority of citizens want action that will make a difference. Other countries have acted: when a mass shooting happened in Australia 2 decades ago, the federal government responded with legislation within 2 weeks of the event banning semiautomatic rifles. Since 1996, there has not been a mass shooting on that continent.

Guns kill people. More background checks; more hotel, school, and venue security; more restrictions on the number and types of guns that individuals can own; and development of “smart guns” may help decrease firearm violence. But the key to reducing firearm deaths in the United States is to understand and reduce exposure to the cause, just like in any epidemic, and in this case that is guns.…

Suppose we identified a public health hazard that caused 36 deaths. There would certainly be considerable interest in the nature of the problem and what could be done about it. Suppose that were 360 deaths instead. That would be national news that would be followed up with Congressional hearings. Suppose it were 3,600 deaths. Whoa. Yet, in 2015, there were 36,252 deaths from firearms in the U.S.

So where is Congress on this? The latest gun tragedy in Las Vegas included the use of bump stocks – devices that allow semi-automatic weapons to fire in rapid succession just like machine guns. So bipartisan legislation was introduced to ban these devices. Speaker Paul Ryan responded by saying that this was a matter for the regulators, so no legislation will be introduced on the House floor. The National Rifle Association – NRA – still owns Congress.

Unfortunately, the well meaning editorial by the 12 JAMA Network editors is all too typical of the responses to these tragedies. Gun violence is tragic, and we should do something about it. Pause. (Time to get back to work.)

Since 1968, more U.S. residents have died from gun violence than have have died in battle during all the wars the country has fought since its inception.

It’s time to get serious about gun violence. Let’s sit down at the negotiating tables with an opening position that all guns throughout the nation be collected and melted down – no compromises – though we would listen to counter proposals.

What does this have to do with single payer? Eliminating gun violence would reduce our national health expenditures in a beneficial way – one of the prime goals of an improved Medicare for all.

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Bain & Company on the absence of ‘a compelling way forward’

Posted by on Wednesday, Oct 11, 2017

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.

2017 US Front Line of Healthcare Survey

Bain & Company

The US healthcare industry is still in search of a cure—a breakthrough model that can deliver high-quality care at lower cost. Over the past five years, hospitals, healthcare groups and medical practices have adopted new management structures and systems to curb spiraling costs. But none has proven to be a compelling way forward, and the pace of change since 2015 has slowed substantially.

The US healthcare model remains firmly centered on physicians.

In fact, more than 60% of the physicians we surveyed believe it will become more difficult to deliver high-quality care in the next two years as they struggle to cope with a complex regulatory environment, increasing administrative burdens and a more difficult reimbursement landscape. After years of experimentation, physicians now want evidence that new models for care management, reimbursement, policy and patient engagement will actually improve clinical outcomes. Without it, they see little reason to alter the status quo and move toward widespread adoption.

Why change has slowed

Physicians and healthcare organizations have become more cautious about adopting new structures, systems and tools for several reasons. With the first wave of change well under way, many practices already have implemented changes that are easy or required, and are reluctant to adopt more-complex systems and tools. Physicians are particularly hesitant to embrace new systems when the clinical implications and the return on investment are unproven and the administrative burden significant.

Comparing our 2015 and 2017 survey findings, one notable slowdown has been in the adoption of value-based payment models. Many physicians anticipated a broad rollout of value-based care two years ago and a corresponding decline in practices using the traditional fee-for-service model. But few have been persuaded to switch, noting a lack of evidence that outcomes are the same or better using value-based care.

More than 70% of physicians prefer to use a fee-for-service model, citing concerns about the complexity and quality of care associated with value-based payment models. Fifty-three percent of physicians say that capitation reduces the quality of care, and most see little advantage from pay-for-performance models either. Further, many believe their organizations are not sufficiently prepared for the shift to value-based care.

The road ahead

After a decade of trying out new models, the US healthcare industry has yet to rally around an innovative approach that provides quality care at lower cost. In fact, a disruptive, technology-based solution like those that have transformed the telecom or retail industries may take much longer to develop for healthcare, although a comparable outcome seems inevitable. In the meantime, the industry will continue to innovate, with progress in fits and starts as different models gain traction in different places.…

Bain & Company is a management consultancy organization. They are believed to have a good grasp of the business prospects of the health care industry. Their 2017 US Front Line of Healthcare Survey is important because it demonstrates that physicians do not believe that the current experiments in models of payment are the way forward.

The report states, “the US healthcare industry has yet to rally around an innovative approach that provides quality care at lower cost.” Dare we say that it is because we are turning to Bain-approved, value-based approaches more suited for the medical-industrial complex rather than being designed by placing the patient front and center?

The Bain report also states, “a disruptive, technology-based solution like those that have transformed the telecom or retail industries may take much longer to develop for healthcare, although a comparable outcome seems inevitable.” Inevitable? Some disruption is inevitable if we are to eliminate our current highly dysfunctional financing system that results in high costs, gaps in coverage, and mediocre quality. Technological advances may be helpful, but they need to be much better targeted than they currently are.

Instead of searching for nebulous, value-based, MBA-designed payment models, we need to adopt the already proven model of a well-designed single payer national health program. More physicians are now beginning to realize that a system designed to provide optimal care for the patients is a system in which physicians themselves will also thrive.

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Cost-sharing payments have far outpaced wage growth

Posted by on Tuesday, Oct 10, 2017

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.

Increases in cost-sharing payments have far outpaced wage growth

By Gary Claxton, Larry Levitt, Michelle Long and Erik Blumenkranz
Kaiser Family Foundation, Peterson-Kaiser Health System Tracker, October 4, 2017

Rising cost-sharing for people with health insurance has drawn a good deal of public attention in recent years.  For example, the average deductible for people with employer-provided health coverage rose from $303 to $1,505 between 2006 and 2017.

To look at what workers and their families actually spend out-of-pocket for services covered by their employer-sponsored plan, we analyzed a sample of health benefit claims from the Truven MarketScan Commercial Claims and Encounters Database to calculate the average amounts paid toward deductibles, copayments and coinsurance.

We find that, between 2005 and 2015, average payments for deductibles and coinsurance rose considerably faster than the overall cost for covered benefits, while the average payments for copayments fell.  As can be seen in the chart below, over this time period, patient cost-sharing rose substantially faster than payments for care by health plans as insurance coverage became a little less generous.

From 2005 to 2015, the average payments by enrollees towards deductibles rose 229% from $117 to $386. The average payments towards coinsurance rose 89%, from $134 to $253, while average payments for copays fell by 36%, from $218 to $139. Overall, patient cost-sharing rose by 66%, from an average of $469 in 2005 to $778 in 2015. Wages, meanwhile, rose by 31% from 2005 to 2015.

The relatively high growth in payments toward deductibles is evident in the changes over time in the distribution of cost sharing payments: deductibles accounted for 25% of cost sharing payments in 2005, rising to 50% in 2015.

Deductibles are the most visible element of an insurance plan to patients, which may help explain why consumers continue to show concern about their out-of-pocket costs for care. Although health insurance coverage continues to pay a large share of the cost of covered benefits, patients in large employer plans are paying a greater share of their medical expenses out-of-pocket. And, while health care spending has been growing at fairly modest rates in recent years, the growth in out-of-pocket costs comes at a time when wages have been largely stagnant.…

In the past decade, payments for health insurance deductibles increased by 229% – over 7 times the 31% rate of increase in wages during that same period. The authors conclude, “Deductibles are the most visible element of an insurance plan to patients, which may help explain why consumers continue to show concern about their out-of-pocket costs for care.”

In yesterday’s Quote of the Day message, David Himmelstein, Carol Paris and Steffie Woolhandler explained why cost sharing, such as deductibles and copayments, are detrimental to health care and should be abandoned. If you do not yet have down pat an “elevator speech” on why cost sharing should be eliminated, perhaps you should read again (or for the first time) their background explanation, available at the following link:…

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Why cost sharing should be abandoned

Posted by on Monday, Oct 9, 2017

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.

Down With the Copay

By Natalie Shure
Jacobin, October 6, 2017

In the week preceding the release of Bernie Sanders’s Medicare for All bill, the Vermont senator’s office was flooded with calls — so many, in fact, that the legislative aides on the other line often guessed callers’ purpose before being prompted. At issue was whether the single-payer health care system Sanders’s bill envisions should include copayments, out-of-pocket payments for health services at the point of care.

For the single-payer advocacy group Physicians for a National Health Program (PNHP), the answer was a resounding “no.” So upon discovering that copays remained in Sanders’s penultimate draft, they sprang into action. After a week of open letters, tweets and appeals from like-minded organizations, Sanders ultimately struck copays from the bill’s final version.

Earlier versions of Sanders’s bill probably included copays for doctors visits and prescription drugs for the same reason that economists like them: they drive down health care usage and costs. After all the attacks branding Sanders’s relatively pedestrian social-democratic platform as fantastical promises of ponies for all, perhaps Sanders’s legislative aides believed meager copays gave their proposal an air of seriousness.

But the obliteration of copays isn’t a bug in the thinking behind Medicare for All — it’s the feature.

“Cost-sharing” features like copays, coinsurance, and deductibles are major manifestations of market logic in the US health-care system. If we want to overturn for-profit health care’s rebranding of “patients” as “consumers,” we have to eliminate financial barriers at the point of care.

The cliched justification for charging copays is to relieve doctors’ offices of the burden of patients showing up at the first sign of a sniffle. (Never mind that we observe no such behavior among the wealthy, for whom copays are no barrier.) But we do know that even meager copays make people seek less care, and that the poor suffer worse health outcomes as a result.

“I spent my entire career taking care of low-income people, and trust me — a copayment will keep people away from a doctor. I’ve seen it again and again in my practice,” Dr. Steffie Woolhandler, the co-founder of PNHP, told me over the phone. “It’s a huge amount of money for a low-income person.”

While several countries with universal health care systems do charge copayments at the point of use, they don’t tolerate the amount of poverty that we do in the United States. No other wealthy country does. In a grotesquely unequal society, a copayment doesn’t create “better consumers” of care — it helps us scrimp by shoving the most powerless out of the system.

Over decades of bending over backwards to accommodate the internal contradictions of the private health insurance industry, few made the one point that really mattered: we never built an insurance system that strove to guarantee universal health care; we built one that strove to protect capitalists’ profits. We can build one based on addressing all people’s health care needs right now.

Medicare for All could create a universal health-care system designed to provide health care for everyone. The logic of the market has no place in such a system. Winning a truly universal system means zero deductibles and zero copays.…


Physicians for a National Health Program, August 23, 2017

Dear Senator Sanders:

We are writing to express our concern about elements of your draft single payer legislation, especially the inclusion of copayments for medically-necessary care.


Copayments undermine the goal of eliminating financial barriers to care, a goal that is at the heart of our single-payer advocacy. Copayments, even relatively modest ones, deter patients from seeking needed medical care.

For instance, in the Rand Health Insurance Experiment, compared to persons with entirely free care, those with copayments (as low as 16% of costs) reduced their use of essential and low-value medical services to a similar degree. Among non-poor adults, copayments reduced the use of “highly effective” care for acute conditions such as chest pain, urinary tract infections and fractures by 29% and “rarely effective” care (e.g. for a cold) by 22%. Highly-effective care for chronic conditions fell by 15%, and for acute-on-chronic conditions fell by 21%. For non-poor children, copayments reduced highly-effective care (e.g. for ear infections and strep throat) by 15%, and cut well-child visits by 21%. Cost sharing reduced prescriptions for several potentially life-saving medications such as insulin, asthma inhalers, and beta blockers by about 50% and oral contraceptive use by 25%. While the Rand Experiment was too small and too short to detect the expected deleterious outcomes of these shortfalls in care, it documented that copayments resulted in significantly worse control of blood pressure, a key cause of heart attacks, kidney failure and strokes.

More recent studies confirm the health-endangering effects of out-of-pocket charges for care. Among persons with employer-paid coverage, raising out-of-pocket charges cut care much more for those in poor health. When Medicare added new copayments, outpatient visits dropped but hospitalizations rose. Among insured post-heart-attack patients, eliminating medication copayments increased compliance, and (for minority patients), led to a 35% reduction in major complications such as recurrent heart attacks. Similarly, among insured school-age children with asthma, those with higher copayments used fewer medications but had a 41% greater risk of asthma-related hospitalization. For nearly one- third of lower-income asthmatic children with high-cost-sharing coverage through the Kaiser Health Plan, parents reported delaying or avoiding outpatient visits, and 14.8% reported non-adherence to medications because of cost. The low income group in the study included those with family incomes up to 250% of poverty, some of whom would be hit by copayments under the proposed legislation. In that study, 15.6% of all parents (including those with higher incomes) reported borrowing money or cutting back on necessities to pay for their children’s asthma care.

Paradoxically, the reduction in care-seeking because of copayments may fail to cut system-wide utilization, instead shifting care from sicker and lower-income persons to the healthy and wealthy. When lower-income patients avoid care, doctors and hospitals fill the empty appointment slots and beds with less price-sensitive patients, an example of supply-sensitive demand.

International evidence indicates that cost-sharing is neither necessary nor particularly effective for cost control. Canada, which outlawed copayments and deductibles in 1981, has seen both faster health improvement and slower cost growth. Notably, Canada experienced no surge in care when it abolished copayments. Similarly, in the U.S. there was no overall increase in doctor visits or hospitalizations when Medicare and Medicaid were first implemented in 1966; care shifted from more affluent and healthier persons to those who were sicker and poorer. Scotland, which has eschewed patient payments—even going so far as to abolish parking fees—has costs about half those in the U.S. Strikingly, the U.S. has the world’s highest health care expenditures despite its extensive patient cost sharing.

The inclusion of copayments would also undermine the breadth of support for single-payer reform. Many Americans would see no improvement in their current coverage. In 2014, about 28% of Americans incurred no out-of-pocket costs, and 84.3% had out-of-pocket costs of less than $1,000. For them, the proposed coverage would not reduce out-of-pocket costs, at least in the short run. About 5% of those with employer coverage—about 8 million people—currently have plans with zero deductibles and zero copayments. They would have worse coverage under the proposed reform.

Finally, retaining copayments would substantially diminish the administrative savings achievable through a single-payer reform. In order to implement copayments, the single payer insurer would need to track individuals’ changing incomes, family status (to calculate their income relative to the poverty level) and their copayments to date (to ascertain whether they’ve exceeded the out-of-pocket cap), and make that information available in real time to every hospital, clinic, lab, doctor’s office, etc., in the U.S. Providers would need to collect the copays, and bill patients unable to pay at the time of a visit.


In sum, Physicians for a National Health Program cannot endorse or wholeheartedly advocate for a reform that includes copayments for medically-necessary services. While we would welcome the proposed reform as a useful step forward in advancing health justice, the persistence of copayments would unacceptably compromise the legislation’s ability to improve health and foster equality in care. We urge you to reconsider the inclusion of copayments.


David U. Himmelstein, M.D., Co-founder PNHP
Carol Paris, M.D., President, PNHP
Steffie Woolhandler, M.D., Co-founder, PNHP

References available at link:

It is irrefutable that deductibles, copayments, and coinsurance cause patients to forgo beneficial health care services, and that often results in physical suffering and sometimes death. For those who cannot avoid health care, financial hardship is frequently a consequence.

A health care financing system should be designed to assist patients in getting the health care they should have by removing financial barriers to care. Since cost sharing has the opposite effect, it should be abandoned as a policy designed to reduce health care spending. There are other much more patient-friendly policies in a well-designed single payer system that are more effective in containing health care spending.

It is a specious argument that people who do not need health care will seek health care anyway simply because it is free. Some say that it would reduce low-value care, but what is low-value care? When a patient is legitimately concerned about his or her health but then doesn’t require any therapeutic intervention other than reassurance, is that low-value care? No. We want patients to come in to reassure them and ourselves that there isn’t anything more serious that requires medical intervention.

The letter by Himmelstein, Paris and Woolhandler provides an excellent explanation as to why cost sharing should be rejected – why individuals should be approached as patients rather than as consumers.

Their letter also demonstrates that it is imperative that we all continue to speak up with the truth about health care reform. Important people are listening.

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MedPAC will recommend repeal of MIPS

Posted by on Friday, Oct 6, 2017

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.

MIPS Takes a Beating at MedPAC

By Shannon Firth
MedPage Today, October 5, 2017

The Merit-based Incentive Payment System (MIPS) should be spiked, virtually all members of the Medicare Payment Advisory Commission (MedPAC) said during a meeting on Thursday morning.

MedPAC, whose members include physicians, healthcare executives, and other policy experts charged with advising the Department of Health and Human Services on Medicare policy issues, has been set on defeating MIPS for a long time; but whether the program should be simply “repealed” or “repealed and replaced” wasn’t clear at Thursday’s meeting.

The MIPS program is one of two payment vehicles created as a result of the the Medicare Access and CHIP Reauthorization Act (MACRA) — which replaced the almost universally despised Sustainable Growth Rate (SGR) formula. The other payment pathway consists of an array of advanced Alternative Payment Models (APMs), which weren’t discussed in any detail at the meeting.

The main problem with the MIPS program, as MedPAC’s analysts see it, is that MIPS won’t achieve the policy goals that it’s designed to achieve.

“Our most basic concern is that the measures in MIPS have not been proven to be associated with high-value care,” said (David Glass, a principal policy analyst for MedPAC).

Alternative Proposed

Glass and MedPAC senior analyst Kate Bloniarz suggested an alternative policy approach that leverages population-based measures.

The Voluntary Value Program, as they’ve dubbed the alternative, would get rid of the MIPS program and all three types of reporting requirements — Advancing Care Information (ACI), Clinical Practice Improvement Activities (CPIA), and quality measures — and scrap CMS support for Electronic Health Records reporting.

In the new model, all clinicians would see a portion of their fee schedule dollars withheld, which would be lumped into a pool — for example 2%, though analysts stressed the percent amount had not been decided.

Clinicians would then have three options:

* Choose to be measured with a “sufficiently large entity” of clinicians and be eligible for value payments

* Choose to participate in an advanced APM model

* Lose the withheld fee schedule dollars

In the end, (Commission Chairman Francis J. Crosson, MD) determined that MedPAC’s technical team would return to the group with draft recommendations for repealing the MIPS program and offer two options: a voluntary replacement program similar to the one discussed at Thursday’s meeting with some revisions, and suggestions on how to make the advanced Alternative Payment Models more accessible for physicians.

The commission could then decide whether to recommend one or both options to HHS.…


URGENT: Explaining MIPS; Action required

Comment by Don McCanne, M.D.
PNHP Quote of the Day, March 21, 2015

Yesterday’s Quote of the Day message (March 20, 2015) sounded the alarm on legislation that would replace the flawed Sustainable Growth Rate formula (SGR) for updating Medicare payments with a new Merit-based Incentive Payment System (MIPS) – legislation with strong bipartisan support that will be taken up in Congress this week and is expected to pass.

The SGR formula is considered to be flawed primarily because economic factors considered in the formula would result in inappropriate payment reductions in many of the yearly adjustments. Thus there is consensus that the formula should be repealed.

The concern is over its replacement: MIPS. On reading the summary of the “SGR Repeal and Medicare Provider Payment Modernization Act,” you will see that MIPS places a tremendous administrative burden on health care professionals in a health care system that is already overwhelmingly overburdened with administrative excesses. The only way to escape this additional burden is to participate in Alternative Payment Models (APMs) which, in themselves, create further significant administrative burdens (ACOs, PCMHs, etc.). MIPS is an administrative nightmare.

The problem is that those who do not game the system, and especially those with practice situations and patient populations that make it very difficult to score higher points, will almost automatically receive performance scores below the threshold since their performances will be compared with the gamers. This will result in negative payment adjustments – reducing payments by up to nine percent. If you think SGR is unfair, MIPS robs from these hard-working professionals who are just trying to make the system work for their patients, and gives the spoils to those who likely have consultants to show them how to game the system.…

Lost in the celebration two years ago over ending the highly flawed SGR method of updating Medicare payments was the fact that its replacement, the Merit-based Incentive Payment System (MIPS), would create an administrative nightmare while failing to achieve its goal of higher quality care at lower cost.

It’s not that the problem wasn’t recognized (see the March 2015 comment), but the policy community and the politicians just don’t get it. They make up theory, knowing that with their genius, these proposals will be phenomenal. Then they do the policy research. Well, MIPS is not working.

So what do they recommend? Let’s push physicians into the other part of the MACRA legislation, the Alternative Payment Models (APMs) – accountable care organizations and the like. After all, they have been under study for several years now and they say that they are just beginning to show slight improvements in a couple of quality measurements, and they also say that they are beginning to show a very slight downward trend in costs in some instances, unless you look at the details. In truth, they are adding to the administrative complexity with higher administrative costs that they are deliberately leaving out of their calculations, and, worse, they are increasing physician burnout.

In spite of the pessimism, they defend their position by saying that we can’t go back to the way things were. We have to start paying for value instead of volume. Yet they have failed to demonstrate two things: how you do that, and, more importantly, how a system using fee-for-service, capitation, salary, global budgeting, and rate negotiation, as appropriate, is somehow inferior to their screwball theories of value-based financing.

Of course, we offer up a well-designed single payer system as a much better alternative. And what is their response?  Single payer might be a consideration for some time in the distant future, but not now. We have to build on what is working – our administratively complex, dysfunctional, overpriced system that leaves tens of millions without appropriate care and often destitute. But they say they can fix those things by adding a public option or a Medicare buy-in, except that we will still be faced with even more administrative complexity, higher costs, too many uninsured and even greater numbers who face intolerable medical debt as the insurers place even more risk on the health care consumers (formerly known as patients).

The good news is that MIPS is going away. The bad news is that the rest of the crap stays in place and will get worse simply because we need to postpone single payer and instead build on the Affordable Care Act and its offshoots like MACRA and APMs.

Time to take a knee for single payer, or is that still a fantasy?

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Paying for CHIP with means-tested Medicare Parts B and D premiums

Posted by on Thursday, Oct 5, 2017

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

Bill to Rescue Children’s Health Program Hits Snag in House

By Robert Pear
The New York Times, October 4, 2017

Legislation to rescue the Children’s Health Insurance Program sailed through a Senate committee on Wednesday, but touched off a partisan conflict in the House, diminishing hopes that the popular program would be quickly refinanced.

By voice vote, the Senate Finance Committee approved a bill on Wednesday that would provide more than $100 billion over five years for the program, which insures nearly nine million children.

The Senate bill does not specify how the government would pay for extending the children’s health program.

But in the House Energy and Commerce Committee, lawmakers brawled Wednesday over a similar bill to provide money for the children’s health program. Democrats strongly support the program, but complained that Republicans would take money from Medicare and the Affordable Care Act to offset the cost.

The House committee eventually approved the bill, by a vote of 28 to 23, with all of the opposition coming from Democrats.

One provision of the House Republican bill would require older Americans with income of more than $500,000 a year to pay higher Medicare premiums.

“Folks that earn a half-million dollars a year and are over 65, they can pay a little bit more for Medicare,” said Representative Fred Upton, Republican of Michigan. “And you know what? If they don’t want to pay, they don’t have to enroll. That’s a choice they will have.”…

“Helping Ensure Access for Little Ones, Toddlers, and Hopeful Youth by Keeping Insurance Delivery Stable Act of 2017” – See Sec. 203:…

Modifies Section 1839(i)(3)(C)(i)(II) of the Social Security Act:…


Means testing Medicare

Comment by Don McCanne, M.D.
PNHP Quote of the Day, December 11, 2012

Now that health care costs are unbearably high, Medicare must be progressively financed since moderate- and low-income individuals can no longer bear the full costs. A major step forward was the removal of the cap on wages subject to Medicare taxes, so higher income individuals pay more. The Affordable Care Act also added a new 0.9% Medicare tax for incomes over $200,000/$250,000.

In addition, in order to help cover Medicaid expansion and subsidies for the exchange plans, the Affordable Care Act also added a 3.8% tax on investment income, again for those with incomes over $200,000/$250,000. So we have already embarked on policies that make health care financing progressive, though we need to do more, but only on the financing end.

Medicare benefits should be the same for everyone. We should eliminate premiums and cost sharing, and we should expand benefits so that administratively wasteful Medigap and retiree health benefit programs are no longer necessary. Low income individuals should receive the same standard of care as the wealthy, just as was the intent in enacting the traditional Medicare program.

Introducing means testing, which we have already begun with Part B and Part D premiums, reduces support of wealthier beneficiaries who are annoyed by these additional charges. Once the principle of means testing is established, the budget hawks ratchet it up, driving wealthier individuals to look for private options, currently available as the Medicare Advantage plans. It is only one small additional step to introduce premium support – vouchers – where the wealthy will take their money and run. Once you lose support of wealthier individuals who have a strong political voice, then Medicare will descend down the path toward becoming a welfare program.…

There seems to be consensus that the Children’s Health Insurance Program (CHIP) should be renewed but there is considerable disagreement on how to pay for it. One proposal is to increase Medicare premiums for those with incomes over $500,000, making them pay the full Medicare Part B and D premiums with no contribution from the government. They can certainly afford it, so why shouldn’t we do that?

Because of the high costs of health care and the modest incomes of most beneficiaries, the funding of Medicare must be progressive. We are already doing that to a limited extent through the taxes that fund the Medicare program. But it is imperative that we limit progressive funding to the revenue side of the ledger while keeping benefits uniform for everyone on the spending side. Why?

Medicare is an egalitarian program designed to provide everyone who is eligible with the health care that they need regardless of ability to pay. Everyone has the same health care benefits. But the Part B and D premiums are means-tested – higher-income individuals pay larger premiums. The extra premiums paid can be considered to be a net reduction of the Medicare benefits. When the government contribution is reduced by 100 percent, then the individual is paying the full costs for Parts B and D in addition to what has been paid through payroll taxes and general revenues.

Inevitably this would cause high-income individuals to look for other options in the private sector. Since this is the Medicare segment with the strongest political voice, support for the program would decline, converting Medicare into a chronically underfunded welfare program.

Of course, the politicians are fully aware of this. As Representative Fred Upton says, “And you know what? If they don’t want to pay, they don’t have to enroll. That’s a choice they will have.”  Obviously this advances the efforts to privatize Medicare, opening the door for premium support (vouchers).

Medicare premiums, deductibles, and coinsurance are unnecessary and should be eliminated. The entire program can be funded much more equitably through the tax system, which is the way it should be when we convert it to an improved Medicare for all.

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Taking a knee for single payer – a fantasy

Posted by on Wednesday, Oct 4, 2017

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 Choice Between Kneeling and Winning

By David Leonhardt
The New York Times, October 2, 2017

Symbols matter in politics. They often matter more than the detailed arguments that opposing sides make. Symbols are a shortcut that help persuadable outsiders figure out where to line up.

The professional athletes doing political battle with President Trump are heirs to the civil-rights movement. They are protesting government-sanctioned violence against African-Americans. Risking popularity for principle, they have shown a courage frequently lacking among the affluent and famous.

From a moral standpoint, this issue is clear. The athletes are right — and have every right to protest as they have. Trump is wrong, about the scourge of police violence and about freedom of speech.

But righteousness does not automatically bring effectiveness.

The kneeling argument needlessly alienates persuadable people, and it’s one the athletes don’t need.

Why? Because most Americans respect the country’s symbols and because standing is a simple sign of respect.

Beyond the athletes, there is a bigger question: Do Trump’s opponents want to oppose him in ways that are merely just and satisfying? Or do they want to beat him? “You can’t get angry,” as the longtime activist Vernon Jordan has said, describing a different civil-rights battle, in the 1950s. “You have to get smart.”

Getting smart means nominating progressive candidates who can win, even if they aren’t progressive on every issue. Getting smart means delaying internal fights (like single-payer health care) and unifying against Trump’s agenda (as Democrats in Congress have).…


Responding to Ta-Nehisi Coates

By David Leonhardt
The New York Times, October 4, 2017

Ta-Nehisi Coates has criticized my column on kneeling athletes, and several readers also made a version of his point, in emails.

Here is part of what he said:

“And David says, ‘While I’m in sympathy with these players, they need to look at the past and learn that it’s possible to appeal to the masses of Americans, that you can get Americans on your side if you can find something that bridges the gap, that brings us all together. And kneeling doesn’t do that.’

“And he shows some polling data to show that. I read that, and I almost threw my computer across the room. Because in fact there is polling data about what Americans thought of Martin Luther King, and the Freedom Riders, and the March on Washington. It wasn’t a high opinion at all.”

I understand why many Americans feel despair today and why many on the political left aren’t in a patriotic mood. Racial inequities remain shameful. Gun violence continues unabated. The planet warms. And Trump creates one new crisis after another.

I also understand that protest movements need both radicals and pragmatists to succeed. The civil rights movement had both, and today’s athletes deserve credit for the stir they’ve created. But if progressives choose to reject pragmatism, optimism and, yes, patriotism, I suspect they will spend many years protesting the country’s direction instead of setting it.…


Civil-Rights Protests Have Never Been Popular

By Ta-Nehisi Coates
The Atlantc, October 3, 2017

The idea here is that kneeling NFL players are committing an act of such blatant disrespect that they hand Trump an easy image with which to demagogue.

(David) Leonhardt goes on to contrast this species of activism, which aligned “the civil-rights movement with the symbols and ideals of America,” with kneeling during the national anthem, which presumably signals opposition to those same symbols. Leonhardt is sympathetic to the aims of Kaepernick’s protest but he contrasts this “angry” approach with the “smart” approach of the civil-rights movement.

The trajectory of Leonhardt’s argument is doomed by the defective pad from which it was launched. The problem here is not just a just-so chain of events, but the actual effects of the events. Implicit in Leonhardt’s critique is the idea that Martin Luther King and other civil-rights pioneers, and their protests, were better able to appeal to the hearts of white Americans than Kaepernick and his allies.

As The Washington Post noted last year, only 22 percent of all Americans approved of the Freedom Rides, and only 28 percent approved of the sit-ins. The vast majority of Americans—60 percent—had “unfavorable” feelings about the March on Washington. As FiveThirtyEight notes, in 1966, 63 percent of Americans had a negative opinion of Martin Luther King. The popular hostility toward King extended to the very government he tried to embrace—King was bugged and harassed by the FBI until the end of his life. His assassination sprang from the deep hostility with which he was viewed, not by a fringe radical minority, but by the majority of the American citizenry.

Leonhardt is a smart and knowledgeable columnist. It is thus surprising to see him embrace a mythical rendition of the civil-rights movement that runs counter to the the facts and figures of the time. But Leonhardt’s column seems less interested in offering an accurate apprehension of the civil-rights movement than in employing the civil-rights movement as a club against radicalism in general, and the Bernie Sanders-wing of the left in particular:

“Getting smart means nominating progressive candidates who can win, even if they aren’t progressive on every issue. Getting smart means delaying internal fights (like single-payer health care) and unifying against Trump’s agenda (as Democrats in Congress have). Getting smart means understanding, as civil-rights leaders did, that American symbols are a worthy ally.”

Kaepernick did not inaugurate his protest in hopes of helping elect more centrist Democrats, or any kind of Democrat. That said, he was not immune to compromise. When his initial efforts were met with disdain and deemed disrespectful, he actually consulted a group of veterans to see how he might better pursue a protest. That is the origin of Kaepernick kneeling, and the fact that it too has been met with scoffs points to deeper problem. If young people attempting to board a bus are unacceptable, if gathering on the National Mall is verboten, if preaching nonviolence gets you harassed by your own government and then killed, if a protest founded in consultation with military veterans is offensive, then what specific manner of protest is white America willing to endure?

It’s almost as if the manner of protest isn’t the real problem.…

Pragmatism means getting smart. It means respecting our national symbols. It means not offending football fans by protesting injustice through the act of kneeling before the playing of the national anthem. It means “delaying internal fights (like single-payer health care).” Some would say it even means praising the second amendment with fervor regardless… (I can’t go there right now).

How can a nation become incensed at symbolic gestures while ignoring and walking away from the horrendous injustices that provoke those gestures?

David Leonhardt, in advising us essentially to walk away from an internal fight over single payer is merely expressing the view of the smart pragmatists on the left who have been repeatedly telling us that we need to forget single payer and patch ACA with a public option or Medicare buy-in – an approach that would extinguish the fire under the single payer movement.

If a knee were my choice for a symbol, I don’t think I’d place it on the ground; I fantasize about lodging it in a spot where it would really get the attention of these smart pragmatists.

“What’s that for?”

“It’s about social justice and health care justice, you dumb pragmatist. Instead of worrying about where some person’s knee is, you need to help lead the movement to end the massive suffering, hardship and even death that plague our nation.”

Smart pragmatism, my foot. Or is it my knee?

(Please excuse my anger, but I’m really having trouble with this.)

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The public judges health care by the ‘medical bill score’

Posted by on Tuesday, Oct 3, 2017

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 medical bill score: How the public judges health care

By Drew Altman
Axios, October 3, 2017

We track a lot of numbers in health care: how much we spend on health as a share of our economy; the number of uninsured; and the share of the federal budget allocated to health programs. What we don’t track — and a number the Congressional Budget Office cannot score — is the statistic that means the most to the American people: the share of the public having problems paying their health care bills.

Percent saying they have taken action in order to pay medical bills:

72% – Put off vacations, household purchases

70% – Cut back on food, clothing, basic items

59% – Used up all or most of savings

41% – Taken an extra job or worked more hours

37% – Borrowed money from friends or family

34% – Increased credit card debt

26% – Taken money out of long-term savings

17% – Changed your living situation

15% – Taken out another type of loan

13% – Borrowed from a payday lender

12% – Sought aid of a charity or non-profit

02% – Taken out another mortgage

15% – Made other significant changes

The bottom line:

The “medical bills score” is the single most important measure of how we are doing in health care from the public’s perspective. And ultimately, if Congress ever passes a new health care bill, it is how the public will evaluate that plan — from Graham-Cassidy to Medicare for All and everything in between.

The numbers that matter:

As we found in a Kaiser Family Foundation poll in February:

* 31% of Americans age 18-64 report they or a family member face problems paying their health care bills.

* But that number shoots up to 57% for people who are sick.

It makes sense that people who use more care have more health care bills, but it also reveals how poorly our system performs from a consumer perspective when people who need care the most are protected the least by insurance coverage.

The impact:

Not surprisingly, the uninsured (41%) are more likely to have problems paying medical bills. But this is not a problem limited to the uninsured: 30% of the insured – think voters — have problems with medical bills.

The back story:

The share of the public reporting problems paying their medical bills has not moved much in recent years. The Affordable Care Act has extended coverage and better financial protection to tens of millions, but it doesn’t have much of an impact on affordability beyond people covered by the Medicaid expansion and the marketplaces.

In the far larger employer-based health insurance sector, deductibles and other forms of cost sharing have been growing about five times faster than wages, and deductibles have been growing especially sharply for people who work for smaller employers.

What to watch:

Health care is a pocketbook issue for most of the public and the American people have their own scoring system. They may give this or that mostly partisan response about a health reform idea on a poll, but until they see how they’ll get help paying their health care bills, they will ultimately be disappointed by every health reform plan.…

“Yes, but how will health care reform affect me?” For most people that means, how much will I have to pay for my insurance, and how much will I have to pay out of pocket for my health care?

Except for low-income individuals with heavily subsidized insurance, members of the work force are paying too much for their insurance, either directly or through forgone wages, and they are paying too much when they need to access health care, especially through high deductibles.

Under the Physicians’ Proposal – a single payer model advocated for by Physicians for a National Health Program – insurance premiums would be eliminated and replaced by equitable funding  of a universal risk pool that would be affordable for each of us, and deductibles and other cost sharing would be eliminated for all essential health care services since other, more patient-friendly methods of cost containment would allow the removal of financial barriers to care.

As Drew Altman states, “until they see how they’ll get help paying their health care bills, they will ultimately be disappointed by every health reform plan.” The obvious lesson is that we need to show the public how a single payer, improved Medicare for all program will give them the “medical bill score” they have been looking for, and thus end the scourge of medical debt.

A Physicians’ Proposal for Single-Payer Health Care Reform:

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Multispecialty consolidation drives prices up

Posted by on Monday, Oct 2, 2017

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.

NBER Working Paper 23871: Does Multispecialty Practice Enhance Physician Market Power?

By Laurence C. Baker, M. Kate Bundorf, and Daniel P. Kessler
National Bureau of Economic Research, September 2017


In markets for health services, vertical integration – common ownership of producers of complementary services – may have both pro- and anti-competitive effects. Despite this, no empirical research has examined the consequences of multispecialty physician practice – a common and increasing form of vertical integration – for physician prices. We use data on 40 million commercially insured individuals from the Health Care Cost Institute to construct indices of the price of a standard office visit to general-practice and specialist physicians for the years 2008-2012. We match this to measures of the characteristics of physician practices and physician markets based on Medicare Part B claims, aggregating physicians into practices based on their receipt of payments under a common Taxpayer Identification Number. Holding fixed the degree of competition in their own specialty, we find that generalist physicians charge higher prices when they are integrated with specialist physicians, and that the effect of integration is larger in uncompetitive specialist markets. We find the same thing in the reciprocal setting – specialist prices are higher when they are integrated with generalists, and the effect is stronger in uncompetitive generalist markets. Our results suggest that multispecialty practice has anticompetitive effects.…

Advocates of consolidation in health care tell us that both horizontal and vertical integration improve efficiency and improve the services delivered, thus improving quality and reducing costs. The secret, they say, is to allow the markets to work. But what does this study tell us?

Integration of generalist and multispecialty practices drives up prices of both the generalists and the specialists, which the authors attribute to the anticompetitive nature of multispecialty practices.

Of significance is that this study did not use Medicare data but rather used data from the Health Care Cost Institute which compiles data on commercially insured individuals – the private sector. This study shows, once again, that the U.S. system is unique in relying heavily on the medical-industrial complex, and we are paying dearly for that.

This trend in consolidation has been increasing, and yet where is the government when we need it? Does Medicare do any better? Well, yes. Prices are lower under Medicare than under the private insurance plans, except for the private Medicare Advantage plans (though more is paid to the insurers for administration and profits).

What would happen under an Improved Medicare for All program? Prices would be negotiated to cover legitimate costs and fair margins. That might mean that some Medicare fees would be adjusted upward, especially for primary care, but the chicanery of the private insurers in partnership with their contracted providers would no longer be a factor since they would be replaced by the single payer system.

No doubt progressive members of the policy community will say, “There goes PNHP again with their pipe dreams about single payer nirvana.” But other wealthy nations cover everyone at an average of half of our per capita costs, precisely because they rely on greater government oversight. “Only in America” do we put up with this – American exceptionalism that bites us.

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Physicians for a National Health Program's blog serves to facilitate communication among physicians and the public. The views presented on this blog are those of the individual authors and do not necessarily represent the views of PNHP.

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