News

(From the slide presentation of Gerald Shea, Assistant to the President for
Governmental Affairs, AFL-CIO)

Bill Dreher, Deutsche Bank Securities:

“From the perspective of investors, Costco’s benefits ($10/hour starting wage, 90% paid health benefits after 3 months for full-timers, after 6 months for part-time) are overly generous. Public companies need to care for shareholders first. Costco runs its business like it is a private company.” (Wall Street Journal, 3/26/04)

http://www.cmwf.org/programs/insurance/collins_affordability_723.asp

Comment: The Wall Street solution of eliminating employer generosity may be good for business, but it fails to address the problem of ensuring employee access to affordable health care.

A universal, publicly funded and publicly administered health insurance
program would ensure that access while relieving business administrators of this clear conflict of interest, allowing them to more appropriately concentrate their efforts on maximizing profits.

Posted by pnhp at 10:03 AM | Permalink

Canadian Medical Association Journal
January 20, 2004
Does universal comprehensive insurance encourage unnecessary use?
Evidence from Manitoba says “no”
By Noralou P. Roos, Evelyn Forget, Randy Walld and Leonard MacWilliam

Many have argued that escalating health care costs in Canada are exacerbated by the fact that patients face no costs when they visit doctors or use hospital services. A zero price, it is said, leads to unnecessary use of the system.

Various policies focusing on reducing patient demand have been proposed to address this purported overuse - user fees and medical savings accounts being the 2 most popular. All are supposed to work by creating an incentive for people to decide whether their intended use of the health care system is really necessary. We know that user fees are effective in reducing physician visits by those with low economic status, but have little impact on physician use by the more affluent or on hospital use.

Is there any evidence that a universal health care system encourages the less affluent to see physicians more often than necessary? We have already shown that the great majority of people incur few health care expenditures while a small group incurs high expenditures. This report extends our earlier work by first examining the health and socioeconomic characteristics of those in each expenditure group. We then assess whether residents of low-income areas overuse health care services (particularly physicians) relative to their health status.

Results

Although the data suggest that the health of those with lower socioeconomic status is worse than those of higher status at every level of health care expenditure, there was no pattern of higher physician expenditures on those
whose socioeconomic status is lower.

The 70% of the population on which the province spends 10% of its health
care dollars scored well on all health indicators, and the 10% of the population on which 74% of the dollars are spent scored poorly. In each expenditure group, those with lower socioeconomic status had poorer health.

Despite their poorer health, in each expenditure group, residents of the neighbourhoods with the lowest household incomes incurred physician expenditures that were similar to those of residents of wealthier neighbourhoods.

Interpretation

Most residents of Winnipeg are healthy, infrequent users of physicians and hospitals. Those incurring high health care costs are sick by every measure used. These high-cost users are drawn from every neighbourhood and every
socioeconomic group, and their health care expenditures are driven by hospital costs. High-cost users who are residents of low-income neighbourhoods incur more hospital costs. Other research based on review of medical records has shown the acuity levels of hospitalized patients in the lowest socioeconomic group to be just as high as acuity levels of hospitalized patients in higher socioeconomic groups. Hence the greater use of hospitals by residents of low-income neighbourhoods should not be dismissed as “social admissions”; their high use is consistent with their poorer health status.

Physician visits are the one type of health care use where at least the first visit in any episode is strongly influenced by patient behaviour. The Winnipeg data confirm that physician use by low-income groups is already lower than would be expected given their health status (or physician use by high-income groups is higher than one would expect).

The patterns of health care costs that we examined are driven by poor health and hospital expenditures. Policies aimed at reducing patient demands, such as user fees and medical savings accounts, are not likely to reduce overall costs. User fees discourage physician contact, not hospital use. Thus, user fees would discourage preventive contacts, particularly among the poor, a group in which pap smears, childhood immunizations and prenatal care are already known to be underutilized. Since the RAND study demonstrated that user fees discourage patients from seeking both appropriate and inappropriate care, their effects on even the healthy poor would be pernicious.

Physicians are the gatekeepers to hospitals, and the health status of the patient largely drives the decision to admit and, hence, expenditure patterns. Although higher income patients may be more articulate in asking for high-profile surgical treatments, overall those with the poorest health status show the highest hospital use and expenditure rates. There is scope for decreasing hospital expenditures by focusing on evidence-based medicine, physician practice patterns and hospital management. However, user fees and medical savings accounts are unlikely to contribute to this process.

http://www.cmaj.ca/cgi/content/full/170/2/209?maxtoshow=&eaf

Comment: 70% of the Winnipeg population consumes only 10% of health care costs. For this healthy sector, creating sensitivity to health care costs through user fess or health saving accounts would have a negligible impact on total health care spending since only 10% of the budget would be manipulated.

It should come as no surprise that Canada spends most of its universal health care funds on people in poor health who need health care regardless of socioeconomic status. Since the health care system should be designed to enable access for those with needs, user fees are superfluous for the affluent but would create financial barriers for low income individuals with legitimate health care needs.

This and other studies show that skyrocketing health care costs are not due to healthy people demanding unnecessary care. Consequently, user fees and health savings accounts cannot possibly have a significant impact on controlling health care costs. Reasonable solutions are possible only once the real problems are more precisely defined.

For a brief discussion of some of the true reasons for cost increases and a suggestion for more rational solutions, read PNHP’s written testimony for the House Ways and Means Committee hearing on the Trustees 2004 Report for Medicare:

http://www.pnhp.org/news/2004/march/pnhps_written_testim.php?page=all

Posted by pnhp at 02:21 PM | Permalink

The Commonwealth Fund
March 29, 2004
Health Care Reform a Major Campaign Issue for Voters: New Survey

Percent of adults ages 19-64 with any medical bill problem or outstanding Debt (Problems paying/not able to pay medical bills, contacted by a collection agency for medical bills, had to change way of life to pay bills, or has medical debt being paid off over time)

Income less than $35,000:
62% of uninsured have problems
45% of continuously insured have problems

Income over $35,000:
57% of uninsured have problems
29% of continuously insured have problems

http://www.cmwf.org/media/releases/collins723_hisurvey_release03292004.asp

For the full report:

http://www.cmwf.org/programs/insurance/collins_biennial2003_723.pdf

Comment: For those who are still not convinced that we have a crisis in health care funding, these numbers should be an awakening. Perhaps the most shocking number is the group that is least impacted, those with incomes over $35,000 who are continuously insured. This is mainstream America. These individuals have been relatively complacent since many of them have believed that the crisis in health care coverage has not affected them. But it has. 29% of mainstream America, in spite of continuous health care coverage, have financial problems due to medical bills!

The outrageously wasteful, expensive, and ineffective private health plan industry is no longer providing us with adequate financial security for medical costs. Let’s throw them out and establish our own publicly financed and publicly administered program of health insurance. Now!

Posted by pnhp at 11:29 AM | Permalink

Please click here to read the article

Posted by pnhp at 01:57 PM | Permalink

The Medicare Muddle
By PAUL KRUGMAN
Published: March 26, 2004

In advance of Tuesday’s reports by the Social Security and Medicare trustees, some credulous journalists wrote stories based on tips from advocates of Social Security privatization, who claimed that the report would offer a radically downgraded vision of the system’s future. False alarm: projections for Social Security are about the same as last year. Projections for Medicare, however, have worsened: last year the trustees predicted that the hospital insurance trust fund would last until 2026, and now they’ve moved it back to 2019.

How should we react to this news?

It has become standard practice among privatizers to talk as if there is some program called Socialsecurity and medicare. They hope to use scary numbers about future medical costs to panic us into abandoning a retirement program that’s actually in pretty good shape. But the deteriorated outlook for Medicare says nothing, one way or another, about either the sustainability of Social Security (no problem) or the desirability of private retirement accounts (a lousy idea.)

Even on Medicare, don’t panic. It’s not like a private health plan that will go belly up when it runs out of money; it’s just a government program, albeit one supported by a dedicated tax. Nobody thinks America’s highways will be doomed if the gasoline tax, which currently pays for highway maintenance, falls short of the system’s needs — if politicians want to sustain the system, they will. The same is true of Medicare. Rising medical costs are a very big budget issue, but 2019 isn’t a drop-dead date.

The trustees’ report does, however, give one more reason to hate the prescription drug bill the administration rammed through Congress last year. If deception, intimidation, abuse of power and giveaways to drug companies aren’t enough, it turns out that the bill also squanders taxpayer money on H.M.O.’s.

A little background: conservatives have never mounted an attack on Medicare as systematic as their effort to bully the public into privatizing Social Security. They do, however, often talk about Medicare “reform.” What this amounts to, in practice, is a drive to replace the traditional system, in which Medicare pays doctors and hospitals directly, with a system in which Medicare subcontracts that role to private H.M.O.’s.

In 1997 Congress tried to take a big step in that direction, requiring Medicare to pay per-person fees to private health plans that accepted Medicare recipients. There was much talk about the magic of the marketplace: private plans, so the theory went, would be far more efficient than government bureaucrats, offering better health care at lower cost.

What actually happened was that private plans skimmed the cream, accepting only relatively healthy retirees. Yet Medicare paid them slightly more per retiree than it spent on traditional benefits. In other words, instead of saving money by subcontracting its role to private plans, Medicare was in effect required to pay H.M.O.’s a hefty subsidy.

The only thing that kept this “reform” from being a fiscal disaster was the fact that after an initial rush into the Medicare business, many H.M.O.’s pulled out again. It turns out that private plans are much less efficient than the government at providing health insurance because they have much higher overhead. Even with a heavy subsidy, they can’t compete with traditional Medicare.

There’s a lesson in this experience. Sometimes there’s no magic in the free market — in fact, it can be a hindrance. Health insurance is one place where government agencies consistently do a better job than private companies. I’ll have more to say about this when I write about the general issue of health care reform (soon, I promise!).

But whether because of ideology or because of H.M.O. campaign contributions, the people now running the country refuse to learn that lesson. As part of last year’s prescription drug bill, they tried again, offering an even bigger subsidy to private plans.

And that turns out to be an important reason for the deterioration in Medicare’s prospects: of the seven years lopped off the life of the trust fund, two are the result of increased subsidies mandated by last year’s law, mainly in the form of higher payments to H.M.O.’s.

So what did we learn this week? Social Security is in decent shape. Medicare has problems, but ill-conceived “reform” has only made those problems worse. And let’s rip up that awful prescription drug bill and start over.  

E-mail: krugman@nytimes.com

Posted by pnhp at 04:19 PM | Permalink

The Washington Post
March 25, 2004
House Panel Hears Concerns About Offering Health Savings Accounts
By Stephen Barr

The House civil service subcommittee plunged into a debate yesterday over whether federal employees and retirees should be offered “health savings accounts” as one of their choices when buying health insurance.

Yesterday’s hearing began with an overview of the FEHBP by Dan Blair, the deputy director of OPM. But the questioning soon turned to the issue of HSAs, with Rep. Jo Ann S. Davis (R-Va.), the subcommittee chairman, asking Blair whether the option might siphon off young people from fee-for-service and other insurance plans.

Blair said OPM did not project a “mass migration” into HSAs based on FEHBP’s
experience in offering “consumer-driven options” since 2002. Consumer-driven
options provide a spending allowance for health care, a free checkup and some other preventive care. But they also are designed to encourage enrollees to hold down medical spending, because they include substantial deductibles when the spending allowance has been used up.

Only 13,151 people have enrolled in consumer-driven plans, Blair said, suggesting that HSAs, if offered, would likely start off with modest enrollment and would not undermine FEHBP’s ability to spread insurance risks across its enrollment — about 9 million Americans.

But Del. Eleanor Holmes Norton (D-D.C.) repeatedly challenged Blair and contended that young people would be drawn to the tax savings provided by
HSAs — splitting FEHBP’s “risk pool.” If that trend developed, Blair said, OPM would step in and redesign the program so that no insurance plans would
be stuck with a higher share of the ailing and sick.

http://www.washingtonpost.com/wp-dyn/articles/A22467-2004Mar24.html

Comment: How would you redesign an insurance program that has concentrated high cost individuals into a separate risk pool? Wouldn’t it be more logical to design the program so that it would prevent risk segmentation?

Posted by pnhp at 09:44 AM | Permalink

The Daily Times
March 24, 2004
Military health plan denied Guard, Reserve
By Mike Madden, Gannett News Service

The Pentagon still isn’t giving uninsured National Guard and Reserve troops access to the military’s health care plan, almost six months after a law mandating the coverage was signed.

Pentagon officials don’t have a set schedule for getting the program ready.

But time may be running out. The legal authority for the program, intended as a demonstration, expires at the end of this year, although some lawmakers want to make it permanent.

As part of the $87 billion bill to pay for fighting and reconstruction . In Iraq, the Pentagon was supposed to let uninsured part-time troops buy into the Tricare health insurance plan.

Some supporters of the Tricare expansion wonder if the Pentagon is deliberately moving slowly. Top defense officials opposed the plan last year, balking at its cost, and oppose extending it past this year.

“I’m terribly concerned that some in the Pentagon are just running out . The clock,” said Senate Minority Leader Tom Daschle.

http://www.thedailytimes.com/sited/story/html/159447

Comment: Wouldn’t it be simpler if we all automatically received comprehensive health care coverage at birth?

Posted by pnhp at 09:16 AM | Permalink

United States House of Representatives Committee on Ways and Means

Hearing on Board of Trustees 2004 Reports
March 24, 2004

Written statement of Don R. McCanne, M.D., Past-President, Physicians for a National Health Program

The 2004 Annual Report of the Boards of Trustees of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds describes the projected imbalances between the anticipated revenues and the expected growth in expenditures of the Medicare program. The Trustees call for prompt, effective, and decisive action to address this challenge.

As expected, a highly charged political debate rages over the causes of these anticipated net deficits in Medicare funding. Although we will hear much about factors such as the generous payments to Medicare Advantage plans, and the decline in tax revenues supporting the program, one factor predominates above all others: health care costs continue to escalate well beyond the level of inflation.

Health care cost increases are related to expanding and ever more expensive technological advances, along with unrestrained expansion in the capacity of our health care delivery system. We are spending more because we find more ways to spend health care dollars, and because we continue to expand the capacity that allows us to do it.

Approaching the Medicare deficit as an isolated problem will not address the fundamental cause of health cost increases. Rather, the integrity of the Medicare program would be threatened because solutions would be narrowly directed to substantially increasing revenues and/or dramatically reducing benefits. Either a reduction in benefits or an increase in cost sharing by the beneficiary would threaten to impair access to care because of lack of affordability for the individual beneficiary. The alternative of asking taxpayers to fund the increase in Medicare costs would be problematic when considering that they would also be facing the same escalating health care costs.
PAGEBREAK
We already know that regions with higher health care capacity have increased intensity of services but without a commensurate improvement in medical outcomes. Hospitals with greater bed capacity in their intensive care units provide costly and relatively inhumane end-of-life care when less expensive and more compassionate care would be provided in a hospice environment. Physician owned specialty hospitals and medical group owned imaging systems significantly increase capacity and the level of services although there is negligible data available to demonstrate improved outcomes.

Other nations have demonstrated that planning and capital budgeting of capacity can prevent excessive utilization while ensuring adequate capacity to prevent unnecessary queues. The 15.5% of our Gross Domestic Product that we are currently spending on health care is more than enough to ensure appropriate capacity plus fund the operating expenses of our system, with the proviso that we do not waste resources on some of the current excesses of our system. Although health care planning declined after prior efforts, the current level of spending has reached a threshold that now makes it imperative.

The administrative costs of private health plans are significantly greater than those of public programs such as Medicare. But an even greater problem is the profound administrative burden placed on our health care delivery system by our fragmented system of a great multitude of private plans, large public programs, and, for some, no programs at all. In 2003 numbers, an estimated $286 billion in these administrative costs could be recovered and utilized for the deficiencies in health care coverage today. Eliminating administrative waste must be a part of our solution to rising costs.
PAGEBREAK
Although our national policies protect and promote technological development, there is a pressing need to demand value for our private and public investment. Pharmaceutical firms that develop copycat drugs merely for the purpose of restarting the patent clock should no longer be disproportionately rewarded for such non-innovative efforts. Only new products with demonstrated value should be rewarded with higher prices. Also new products developed with public funding should return that investment to the taxpayer through lower prices. We should require that new technological innovations provide both significant medical benefit and value before funding them. And there is ample evidence to demonstrate that prices are much higher in the United States than in other nations. We clearly need a method of negotiating rates and prices to be sure that we are receiving a fair value for our health care investment while allowing a fair but not excessive profit for the manufacturer or provider.

To bring the level of health care cost increases down to near the rate of inflation, we need to control capacity and pay fair prices. Medicare alone cannot have a significant influence on capacity. Although Medicare does have some regulatory control over prices, acting alone inevitably results in inequitable results through cost shifting and unfairness in pricing, while failing to control global costs. And Medicare cannot further reduce administrative waste when it is adding to the administrative burden by being an additional player in our fragmented system.

Replacing our inefficient and wasteful system of funding care with a single public payer would control costs through global budgeting, planning and budgeting of capital improvements, and negotiation of rates and prices. And with the administrative savings made possible by eliminating the waste of the private bureaucracies, we could afford to fund care for everyone while controlling costs on into the infinite horizon. Instead of limiting Medicare reform considerations to revenue increases and benefit reductions, let us adopt systemic reforms that will enable the enactment of comprehensive, affordable coverage for everyone.

Don McCanne, M.D.
Home address:
33781 Avenida Calita
San Juan Capistrano, CA 92675-4905
Telephone 949-493-3714
Fax 949-493-7985
don@mccanne.org

Physicians for a National Health Program
29 E. Madison St., #602
Chicago, IL 60602
Telephone 312-782-6006
Fax 312-782-6007
pnhp@aol.com
www.pnhp.org

Posted by pnhp at 03:06 PM | Permalink

Institute for Public Accuracy 915 National Press Building, Washington, D.C. 20045 (202) 347-0020
http://www.accuracy.org ipa@accuracy.org, Wednesday, March 24, 2004

Interviews Available:
* The Future of Medicare * Exxon Valdez Anniversary

ALAN SAGER, asager@bu.edu, http://www.healthreformprogram.org
DEBORAH SOCOLAR, dsocolar@bu.edu Sager and Socolar are directors of the Health Reform Program at Boston University’s School of Public Health. They released a report in October 2003 entitled “New Medicare Rx Benefit Means Big Profits for Drug Makers.”

Sager said today: “In 2003, actuaries predicted that the Medicare Trust Fund would be depleted in 2026 — 23 years ahead. Yesterday, the actuaries redicted depletion in 2019 — seven years sooner. The evidence from past years is clear that managed care privatization has cost Medicare money. So no one should be surprised that the Medicare actuaries have cited the new Medicare bill’s provisions as a cause of accelerated Medicare insolvency. A reckless belief that privatization and managed care will save money is no substitute for genuine cost controls. Since Medicare privatization and managed care won’t save money, more people need to ask why this Congress and administration keep boosting it. Other wealthy nations cover all of their citizens, live longer and — on average — spend only one-half as much per person as we do. They are far from perfect, but we can learn from them. For example, sadly, about 50 percent of the U.S. health dollar is wasted on unnecessary clinical services, administration, excess prices for drugs and other items, and outright theft.”

Drs. IDA HELLANDER, QUENTIN YOUNG, (312) 782-6006, pnhp@aol.com, http://www.pnhp.org Hellander is executive director of Physicians for a National Health Program; Young is national coordinator for the group. They are both available for interviews about the future of Medicare.

DEAN BAKER, baker@cepr.net, http://www.cepr.net/publications/medicare_choice_plus.htm
Co-director of the Center for Economic and Policy Research, Baker said today: “The 2004 Medicare trustees report, released yesterday, provides further proof that President Bush’s drug plan was a massive giveaway to the
pharmaceutical and insurance industries.… It is important that the public be made aware that the financial problems facing Medicare are due to corruption and not demographics.… If our government is too corrupt to fix the U.S. health care system, then it should at least allow seniors to buy into the superior systems in other countries.” Baker is author of the report “Medicare Choice Plus: The Answer to the Long-Term Deficit Problem,” which outlines this proposal at the above web page.

DUNE LANKARD, cell: eyak@redzone.org, http://www.redzone.org Fifteen years ago today, the Exxon Valdez spilled millions of gallons of crude oil into Prince William Sound. Lankard (currently in D.C.) is an Eyak of the Eagle Clan and fished for salmon in the Copper River flats and Prince William Sound until the spill. Named a Time magazine “Hero for the Planet” in 1998, Lankard is the founder and executive director of the Eyak Preservation Council. He said today: “Exxon Mobil has yet to make good on their promise for an additional $100 million for the Sound if it had not recovered by now. Meanwhile, the just-released Fortune 500 list found Exxon Mobil to be the second biggest company on this list — and the one with the biggest profits.”

PAMELA MILLER, pkmiller@akaction.net, http://www.akaction.net Also currently in D.C., Miller is a biologist and director of Alaska Community Action on Toxics, an organization that focuses on environmental health and justice issues.

For more information, contact at the Institute for Public Accuracy Sam Husseini, (202) 347-0020 or (202) 421-6858

Posted by pnhp at 12:14 PM | Permalink

Medicare Deficits: Disaster or Opportunity?

2004 Annual Report of the Boards of Trustees of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds

March 23, 2004

Total Medicare expenditures were $280.8 billion in 2003 and are expected to increase in future years at a faster pace than either workers’ earnings or the economy overall. As a percentage of GDP, expenditures are projected to increase from 2.6 percent currently to 13.8 percent by 2078 (based on our
intermediate set of assumptions). The level of Medicare expenditures is expected to exceed that for Social Security in 2024 and, by 2078, to represent almost twice the cost of Social Security. Growth of this magnitude, if realized, would place a substantially greater strain on the nation’s workers, Medicare beneficiaries, and the Federal Budget.

The long-range financial projections for HI (Part A - Hospital Insurance) continue to show a very substantial financial imbalance. Budget. By the end of the 75-year period, scheduled taxes would be sufficient to cover only one-fourth of projected expenses. Accordingly, bringing the HI program into long-range financial balance would require very substantial increases in revenues and/or reductions in benefits.

The projections shown in this report continue to demonstrate the need for timely and effective action to address Medicare’s financial challenges- both the long-range financial imbalance facing the HI trust fund and the heightened problem of rapid growth in expenditures. We believe that solutions can and just be found to ensure the financial integrity of HI in the long term and to reduce the rate of growth in Medicare costs. Consideration of such reforms should occur in the relatively near future.

The sooner the solutions are enacted, the more flexible and gradual they can be. Moreover, the early introduction of reforms increases the time Available for affected individuals and organizations-including health care providers, beneficiaries, and taxpayers-to adjust their expectations. We believe that prompt, effective, and decisive action is necessary to address these challenges.

http://www.cms.hhs.gov/publications/trusteesreport/2004/tr.pdf

Comment: Although the specifics of this 221 page report will provoke considerable debate, the conclusion that action is necessary on Medicare is certainly warranted. But there is risk that attention will be narrowly directed to benefit reductions, tax increases, and privatization proposals involving greater beneficiary contributions.

Reform of health care funding should not be limited to the Medicare program since serious systemic flaws would not be addressed. Excess utilization is clearly linked to excess capacity in the health care delivery system. Measures such as regional planning and separate budgeting of capital improvements would slow cost escalation. But it would be impossible to control capacity for Medicare alone and leave the rest of health care delivery to the marketplace. In fact, health care costs are a problem for all of us, not just for Medicare.

We are spending 15.5% of our GDP on health care this year.That would fund comprehensive services for all of us, including more comprehensive services for Medicare beneficiaries. We do need to address the Medicare imbalance, but let’s do it by adopting a program that would provide access to affordable, comprehensive care for everyone: a single payer program of national health insurance.

Posted by pnhp at 10:21 AM | Permalink

Does universal comprehensive insurance encourage unnecessary use? Evidence from Manitoba says “no”

Many argue that “free” medical care leads to unnecessary use of health resources. Evidence suggests that user fees do discourage physician use, at least by those of low socioeconomic status. In this study, we compare health care utilization and health among socioeconomic groups to determine whether people of low socioeconomic status see physicians more than would be expected given their health status

Read the full article at http://www.cmaj.ca/cgi/content/full/170/2/209?maxtoshow=&eaf

Posted by pnhp at 09:57 AM | Permalink

California Medical Association
House of Delegates
March 13-15, 2004

The delegates adopted a health care financing reform policy (Report B-1-04)…

Report B-1-04
CMA Health Care Financing Reform Policy

Recommendation 7:

That in order for CMA to consider supporting a single payer health reform proposal, the following criteria must be in place:

1. Physicians must be permitted to balance bill their usual and customary rates.

2. A scientific, apolitical body must make benefit/coverage decisions.

3. Pluralistic delivery system options must be retained (e.g., pre-paid
group practices, FFS).

4. A mechanism for addressing fraud.

5. Patients allowed to “buy up” - to purchase additional coverage outside the ‘single’ plan.

6. A mechanism to address capital investment and infrastructure building.

7. Medically appropriate co-payments on a sliding scale must be incorporated
to discourage excessive utilization.

http://www.calphys.org/html/bb522.asp

Comment: Single payer advocates certainly would have problems with some of
the qualifying criteria listed, including balance billing, financial penalties for accessing beneficial services, and the suggestion that buying to the front of the queue might be permitted through “buy up” coverage. But we must recognize that it is truly remarkable that the California Medical Association has officially advanced its position on single payer to one of considering support.

We should work within organized medicine to be certain that single payer continues to be included in the evaluation of all options for reform. As the
general concepts for reform are better understood, we can continue to work
to improve the policy details.

Posted by pnhp at 03:53 PM | Permalink

Al Franken and single payer

The New York Times
March 21, 2004
Al Franken, Seriously
By Russell Shorto

(Al Franken) supports universal health care and is warming to the idea of a
single-payer system.

http://www.nytimes.com/2004/03/21/magazine/21FRANKEN.html

Comment: And that’s no lie!

Posted by pnhp at 09:21 AM | Permalink

The Straits Times
March 19, 2004
New health insurance for all
By Salma Khalik

A compulsory national medical insurance scheme will be put in place to plug a gap in Singapore’s efforts to make health care affordable. Acting Health Minister Khaw Boon Wan will be taking the next few months to hammer out a workable medical insurance plan - a call made time and again by MPs.

Yesterday, Mr Khaw agreed with Government Parliamentary Committee for health chairman Lily Neo that the concept of ‘risk-pooling’ was needed. While there are private medical insurance plans, insurers tend to ‘cherry-pick’, servicing mainly the low-risk group: the young and healthy.

The whole idea is to help Singaporeans ‘stretch their Medisave dollars’, he said. While there is $30 billion in Medisave money, 17 per cent of CPF members have less than $1,000 in their accounts. Even those with the maximum $30,000 in their Medisave will find it insufficient for their needs.

But while it is for the people to decide if they want to opt for MediShield, this new scheme will be compulsory unless the consensus opinion is otherwise.

‘To minimise administrative costs, a compulsory national scheme is best. It ensures full coverage with the lowest premiums. It ensures maximum equity
and efficiency,’ Mr Khaw explained.

http://straitstimes.asia1.com.sg/topstories/story/0,4386,240837,00.html

Comment: The proponents of medical savings accounts (MSAs or HSAs, the health savings accounts of the Medicare bill) frequently cite the “success” of the MSA program in Singapore as a basis for supporting a similar program in the United States.

Singapore has a Medisave program which is composed of individual MSA-type
accounts, a MediShield program which covers catastrophic, life threatening disorders, and a Medifund program that serves the poor. What has become evident is that coverage for non-catastrophic illnesses is clearly needed. Their current system leaves many without affordable access to essential but non-catastrophic health care services.

It comes as no surprise that they have discovered that universal risk-pooling will be necessary to ensure full coverage at the lowest cost and to provide maximum equity and efficiency. It seems that policymakers in the United States should be able to come to the same conclusion.

Posted by pnhp at 09:05 AM | Permalink

If Ashcroft Were Uninsured…
By Dan Frosch, AlterNet
March 14, 2004

From the moment Attorney General John Ashcroft was diagnosed with gallstone pancreatitis on March 4, he has without a doubt received the best and most efficient medical care in the world.

While Justice Department officials haven’t released many details, the Attorney General, because of his status, was most likely whisked through the emergency room at George Washington University Hospital, into intensive care and then surgery, and has all the while been doted on by a team of concerned and caring medical experts.

Ashcroft has little reason to worry about the charges he’s incurring. Like virtually all civilian federal employees, Ashcroft is presumably covered by any one of the impressive health plans offered by the United States Office of Personnel management. The most popular plan, Blue Cross/ Blue Shield ‘Standard,’ could conceivably pay for close to 90 percent of Ashcroft’s hospital care.

But what if John Ashcroft was never confirmed as Attorney General and didn’t have that impressive federal health plan? According to the Chicago-based group, Physicians for a National Health Program (PNHP), 41 million Americans don’t have any health insurance and the majority of them, the group says, aren’t necessarily unemployed.

So, what would have happened if John Ashcroft was not Attorney General, didn’t have health insurance and got sick?

What would happen, hypothetically, is this:
One day, on his way into Washington D.C. to see “The Passion of the Christ,” John Ashcroft gets a searing a pain in his stomach. He calls a doctor friend of his for help but the doc is out to lunch. The doctor’s receptionist tells him he should make an appointment and asks what type of health insurance he has.

After an infuriatingly incomprehensible conversation about health coverage, Ashcroft realizes that, because he’s no longer a Senator from Missouri, he doesn’t have insurance. At 61, he’s four years too young to qualify for Medicare. And, because of the steady income he gets from speaking engagements, he’s not among the desperately poor that receive Medicaid, despite deciding to donate most of that money to a Christian charity leaving him a much more modest man.

The receptionist tells him that without insurance, a doctor’s appointment will now run him about $75, and because he’s now not nearly as wealthy as he once was, Ashcroft tells her he’ll just take some Tylenol.

A week goes by, and Ashcroft’s pain grows steadily worse. He doesn’t go to a doctor though, because he knows it will cost him money he doesn’t have. So instead, Ashcroft pops more Tylenol.

It’s worth nothing that according to PNHP, some 18,000 Americans die every year because they don’t have health insurance and wait too long to see a doctor. A few more days go by, and he decides drives into Washington D.C. to see “Passion of the Christ” a second time. But before he can get to the theater, he’s hit with an unbelievable pain in his stomach.

Bravely maintaining his composure, Ashcroft manages to find his way to D.C. General Hospital, the mammoth public hospital he remembers passing every day on his way to Congress. As he pulls into the parking lot, however, he notices that D.C. General looks abandoned. Now that he thinks about it, Ashcroft vaguely remembers reading some newspaper articles about how D.C. General – the only public hospital in the Washington D.C., which mainly served poor and minority residents – was closed by the city in 2001 because in large part, it was over burdened with uninsured patients who couldn’t pay.

And so, Ashcroft sets off in his car around predominantly poor and black southeast D.C., looking for another hospital. Unfortunately, there couldn’t be a worse time for Ashcroft to be sick and uninsured. Not only is there not another hospital in the neighborhood that D.C. General was serving, but also those hospitals picking up General’s slack – Providence, Howard University, Washington Hospital Center and Greater Southeast – have been overwhelmed with patients.

Much like in other big cities across the country, Washington’s emergency rooms have seen a substantial spike in visits, there are virtually no beds available and intensive care units are filled to 95 percent capacity. What’s more, says Joan Lewis, Senior Vice President of the District of Columbia Hospital Association, now that General is gone, these other hospitals are treating more of the city’s approximately 85,000 uninsured residents and spending more of their already depleted cash supply in the process. Since General closed two years ago, the $131 million Washington hospitals were spending annually to subsidize care for uninsured patients jumped an average of about $24 million per year – an enormous financial strain on a system already stretched too thin. Greater Southeast filed for bankruptcy in 2003 and four more of the city’s other seven hospitals are operating in the red. “Everybody feels like we’re on the edge,” says Lewis. “If there was a big epidemic, a medical crisis, we’d be in real trouble.”

Ashcroft, though, doesn’t know any of this. He just knows he needs help and needs it fast. He finally gets to another hospital – take your pick of the four already mentioned – and stumbles into the emergency room. Packed with people and patients, Ashcroft is told by this receptionist to fill out a not so small folder of forms which all seem to ask him for the same information. He complies, even revealing he has no insurance.

Meanwhile, he’s virtually doubled over in pain. But because Ashcroft appears to only have a bad stomach ache, and he’s surrounded by people in serious trauma, he might wait up to eight hours before being seen – according to the D.C. Health Care Coalition, a group of community leaders, clergy and medical professionals pushing for another public hospital.

Finally, Ashcroft is called into an examination room where a nurse takes a quick look and hands him a packet of Tylenol before sending him on his way. The nurse is too overwhelmed with patients who’ve been shot, stabbed and the like to call an equally overwhelmed doctor to conduct a full examination on Ashcroft.
Ashcroft makes it into his car and out of the parking lot before the unimaginable pain finally causes him to go into shock and collapse.

Alerted to a man passed out in his car in the middle of the street, an ambulance rushes Ashcroft back into the emergency room. This time, because his condition is more urgent, he’s seen immediately by doctors who diagnose him with gallstone pancreatitis – a serious illness that occurs when gallstones block the duct of the pancreas – and advise that he be placed immediately in intensive care. Unfortunately, for Ashcroft, ever since D.C. General and its 22-bed Intensive Care Unit (ICU) shut its doors, there’s been little room anywhere for patients requiring intensive care. As a result, says Joan Lewis, doctors sometimes have to keep critically ill patients in the emergency room and check on them when they can. And so, Ashcroft, barely conscious, is kept in the emergency room until, a few hours later, he’s brought up to the ICU.

There, for four days, Ashcroft, is put on an intravenous, given aggressive pain relief and treated with antibiotics by doctors and nurses who visit him around the clock.

On the fifth day in the ICU, doctors decide that Ashcroft should have his gall bladder removed to prevent any reoccurrence. The surgery goes well, and Ashcroft is taken back to the ICU. The next day, he’s removed to a room for less critical patients so that he can fully recover.

Sometime during the next five days, as he’s recovering, financial staff contracted by the hospital politely question a woozy Ashcroft about how he plans on paying for his time there.

Joan Lewis says such staff would try to convert Ashcroft to the D.C. Health Alliance insurance plan instituted in 2001 to combat the growing rate of uninsured. But the plan only works for people who are at 200 percent of the federal poverty level, leaving the majority of the city’s uninsured still without coverage, including Ashcroft.

“Well,” the money guys tell Ashcroft. “Here’s how much you owe us.” While it’s almost impossible to figure out the exact figure on Ashcroft’s bill, one can estimate. Five days in an ICU unit alone at Providence Hospital in Washington, for example, would run up to $30,000. And then there’s the laparoscopic gall bladder surgery and the five days in recovery – which could cost an additional $28,000 (according to Fairview University Medical Center in Minneapolis). But there are still all the expert doctors who’ve visited him daily and have their own separate charges. That price tag might run Ashcroft as much as $5000 for the ten days he’s in the hospital, says Dr. Quentin Young, PNHP’s National Coordinator and former Director of Medicine at Cook County Hospital. Using such rough estimates, Ashcroft is told he’ll have to fork over at least $63,000. Shocked at such an outrageous figure, Ashcroft insists there’s no way in hell he can pay that amount of money and begins to explain his situation.

A financial counselor enters the room and tells Ashcroft that the hospital has done a little research on his “situation,” and because he does have assets and a steady source of income, however small, he’s not eligible for the hospital’s charity fund, reserved for those who truly have no resources. The counselor says the hospital can put Ashcroft on an assistance program, where he’d be charged an incremental fee depending on his financial status. Or, if he’s lucky, the hospital might eat a percentage of the bill – again, based on his status.

The counselor doesn’t mention it, but he knows that if Ashcroft doesn’t make his payments he can send collection agents after him, and eventually take him to court if need be. After all, the hospital is already strapped for cash and has spent a lot of money treating Ashcroft. Besides, just letting uninsured patients walk out the door could force the hospital to close. Everyone knows what happened to D.C. General.

The D.C. Hospital Association doesn’t keep track of how often its hospitals go after patients who cannot pay, but as David Sparks, Chief Financial Officer of Providence Hospital, puts it, “Collections happen every day and every week. It’s part of the standard process.”

In the end, says Dr. Quentin Young, there’s a good chance Ashcroft will have to pay much of the money he owes in some capacity, or face a lien on everything he owns. The fact is, according to Roger Whelan, a resident scholar at the American Bankruptcy Institute and a former bankruptcy judge, medical bills attributed to a lack of insurance or insufficient coverage are a leading reason why a record 1.7 million bankruptcies occurred in this country last year.

As for the real Ashcroft, he’ll never know the terrifying dilemma of his alter ego – a dilemma experienced by millions of Americans throughout the country every day – because he’s a high ranking official in the Bush Administration and probably has that impressive federal health plan, or one similar to it. (A Justice Dept. spokesman said that Ashcroft is insured but did not know whether he was on the federal plan.) Of course, it’s the same administration, of which Ashcroft is such an integral part, that has been so opposed to expanding health insurance to all people, regardless of age, employment status or economic well being.

Ironically it’s Ashcroft’s own health insurance that is saving him – not only now, while he’s in the hospital, but once he gets the bill.

Dan Frosch is a freelance journalist based in New York City. He’s been on staff at the San Gabriel Valley Weekly section of the Los Angeles Times, The Source magazine, the Pacific Palisadian Post and most recently the Santa Fe Reporter. Dan also contributes to VIBE and POZ magazines.

Posted by pnhp at 02:57 PM | Permalink

America’s Health Insurance Plans (AHIP)
March 9, 2004
America’s Health Insurance Plans Chart a Course for Improving Quality, Access and Affordability

The recently merged American Association of Health Plans (AAHP) and Health Insurance Association of America (HIAA) today unveiled a new name… America
’s Health Insurance Plans (AHIP).

(Co-Chairman Michael) Abbott, who is President and CEO of American Republic
Insurance Company, stated, “Our mission is clear: We will advocate for a legislative and regulatory environment that enables our members to help create a health care system that meets the needs of all stakeholders - consumers, employers and public purchasers. Our goal is to help make access to high-quality, affordable health care a reality for all Americans.”

Board of Directors Statement
A Commitment to Improve Health Care Quality, Access, and Affordability
March 2004

WE BELIEVE that the times call for the nation to make a renewed commitment to meet the needs and expectations of health care consumers regardless of health, socioeconomic status, location or other circumstances.

OPTIONS FOR GIVING ALL AMERICANS ACCESS
(Comments are by Don McCanne.)

• Provide access to health care coverage for lower-income individuals and
  families through tax credits
  Comment: Proposed tax credits are not adequate to make health plans
  affordable for low-income individuals.

• Encourage younger Americans to seek and maintain health coverage
  Comment: The AHIP proposal calls for tax-advantaged health spending accounts
  which would effectively remove this relatively healthy sector from the insurance risk pools, driving up costs for those with greater needs who remain in the traditional plans.

• Intensify efforts to cover adults and children who are eligible for but not enrolled in Medicaid and SCHIP
  Comment: Since this sector does not have enough resources to pay the costly
  health plan administrative expenses, AHIP shifts this responsibility from their plans to administratively efficient public programs funded by taxpayers.

• Create “high-risk” purchasing pools to cover uninsured individuals with
  especially high health costs.
  Comment: One of the great advantages of insurance is that high-risk individuals would have their costs diluted in a large risk pool. AHIP proposes to eliminate these individuals from their plans and have their high-cost care funded by federal and state taxpayers. Excluding those who have greater health care needs from health insurance plans should make us question the need for any involvement by the private health insurance plans.

• Provide bridge loans to help middle-income workers maintain their coverage when they become unemployed
  Comment: Although this proposal increases the risk of personal bankruptcy for the unemployed, it would help to preserve this market for the health plans. The unemployed have enough financial problems without piling on more debt.

• Provide access through public programs for Americans living below
  poverty
  Comment: This perpetuates the under-funded, welfare-model Medicaid-type approach and places the responsibility for funding on the taxpayers rather
  than the health plans.

• Provide access for public financing of private health coverage for
  Americans living near poverty
  Comment: AHIP still wants to keep the health plan market for employed, lower-income individuals, but they want government tax funds to subsidize this market.

• Use tax incentives to promote broader coverage among higher-income workers without insurance
  Comment: Taxpayer subsidization of health care costs increases as income increases with these tax incentives. Health care welfare disproportionately
  benefiting the wealthy is not rational policy.

http://www.aahp.org/Template.cfm?Section=Home&template=/ContentManagement/ContentDisplay.cfm&ContentID=11209
(The Board of Directors Statement may be accessed by clicking on the link at the bottom of the AHIP release.)

Final comment: It seems that the “renewed commitment” and “new direction”
of AHIP would ensure the health of America’s health insurance plans long into the future. But what about patients? The Board of Directors Statement includes a chart that shows that their proposals will provide access to all of the 43 million uninsured. Unfortunately, AHIP’s “new commitment” totally lacks credibility as innumerable studies have confirmed that these proposals cannot possibly meet that goal.

AHIP’s proposals are designed to generously fund their industry’s own administrative services, but when it comes to paying for health care, they turn to the government and the taxpayers.

If this is the best that America’s Health Insurance Plans can come up with, then we clearly need a national, government solution.

Posted by pnhp at 12:33 PM | Permalink

The Henry J. Kaiser Family Foundation
March 2004
Coverage and Cost Impacts of the President’s Health Insurance Tax
Credit and
Tax Deduction Proposals

This issue brief looks at the coverage impacts and costs of the two largest components of the President’s proposal: a new tax credit for people purchasing non-group health insurance and a new tax deduction for premiums for high-deductible, non-group health insurance policies.

The estimates presented below were prepared by Jonathan Gruber, Ph.D., Professor of Economics at the Massachusetts Institute of Technology, using a
microsimulation model developed in conjunction with the Kaiser Family foundation.

Overall, this analysis finds that the President’s tax credit and tax deduction proposals for non-group health insurance, when fully implemented, would increase the number of people with health insurance by almost 1.3 million, at a cost of more than $4,700 per newly insured person. As discussed in more detail below, while the net change in the number of people with insurance is relatively small, these policies would result in a substantial movement of individuals away from employer-based coverage and into the non-group market, or in some cases, into being uninsured. Also of significance, the tax credit and tax deduction policies together result in a lower number of newly insured people, and a higher cost for each person newly insured, than the tax credit policy would achieve standing alone.

Two findings in particular raise important questions for policymakers considering these proposals. The first is the impact of both the tax credit and tax deduction proposals on people with employer-based coverage. By offering tax subsidies for non-group health insurance, the policies would reduce the preference under current tax law for employer-based coverage over non-group insurance, with the likely result that fewer employers would offer health benefits to their employees. In some cases, these employees would not find other insurance, either because they would not want to pay the premiums for non-group insurance or because health problems could make it difficult for them to find affordable coverage in some states. This is not to say that any new problems encountered by people who would lose insurance under these proposed policies are necessarily greater or more important than the financial access problems faced by the people who would benefit from the tax credit and deduction policies, but policymakers need to be aware of the potential for disruption in the group insurance market. In particular, people with health problems who lose employer-based coverage would likely face higher premiums and more coverage restrictions in the non-group health insurance market than they currently face when receiving health benefits through work. These same problems-relatively high premiums and coverage restrictions-already exist for people with health problems purchasing non-group health insurance in most states today. Policymakers may want to consider whether current market responses for people with health problems, such as state high risk pools, are sufficient to assure the availability and affordability of coverage for this population.

A second question raised by these findings relates to who benefits from the proposed policies. …the newly insured under the tax credit policy (and the results for the combined policies are almost identical) tend to be younger and healthier than the uninsured overall, and tend to be younger than the under 65 population as a whole. This raises the question of whether these policies could be modified to provide more assistance to older or less healthy uninsured people, or whether an additional policy response, such as a public coverage expansion, would be needed to increase insurance access for these more costly groups of uninsured people.

http://www.kff.org/insurance/loader.cfm?url=/commonspot/security/getfile.cfm&PageID=32681

Comment: This report updates Professor Gruber’s prior microsimulations demonstrating that providing tax credits for individual (non-group) health plans has very little impact in reducing the numbers of uninsured, but has a more significant impact in shifting coverage from employer-sponsored group plans to individual plans. This shift moves individuals into plans than usually have fewer benefits and much less value. In fact, the amount of the tax credit is offset by the funds wasted by purchasing private plans with their inherent lower value. And individuals with significant health problems are particularly vulnerable in the non-group market. Until we have in place a health insurance system that does provide adequate protection for everyone we cannot afford to adopt policies, such as this tax credit proposal, that threatens the future of group health care coverage.

Now that health savings accounts (HSAs) are a reality, President Bush is proposing that we move on to the next step and make catastrophic (high deductible) plans tax deductible. What difference does it make if we allow individuals with higher incomes to benefit from this proposal? Well, first of all, it is unfair. The tax advantage means that taxpayers would be paying more of the health care expenses of higher income individuals and less for those with moderate or low incomes. A health care welfare program for the rich is not really sound health policy nor sound tax policy.

Of much greater importance is the fact that Professor Gruber’s new microsimulation demonstrates that combining tax credits with tax deductibility of catastrophic plans would greatly accelerate the trend to move out of employer-sponsored group plans, and it would have even less impact on reducing the total numbers of uninsured than would the relatively ineffective tax credit alone. In fact, 2.6 million individuals who currently have employer-sponsored coverage would end up with no insurance at all.

To the casual observer, it would seem that tax credits and deductibility of catastrophic coverage would be a move forward. But since these policies have
only a negligible impact on the total numbers of the uninsured, and since they shift individuals from the security of employer-sponsored group plans into the highly flawed marketplace of individual plans, the net impact is decidedly negative.

We do need to move away from employer-sponsored group plans. But that shift
must be into an equitable system of social insurance. Tax policies that benefit the rich and healthy and benefit the private health plan industry should be emphatically rejected.

Posted by pnhp at 10:21 AM | Permalink

Association of School Business Officials International
March 14, 2004
Rising Health Costs Hit School Maintenance, Tech and Teacher Budgets

School business officials say the cost of employee health insurance has risen so sharply that it has adversely hit their budgets-so much so that they’ve trimmed spending on building maintenance, teaching positions, technology upgrades and professional development for teachers.

The information comes from administrators across the country who belong to the Association of School Business Officials International (ASBO) in Reston, VA and who replied to a recent on-line survey. A vast majority (95%) agrees that the cost of health insurance in their district is a bigger problem now than ever before. Over 90% place the blame on the basic cost of health insurance.

ASBO President William R. Fellmy, Ph.D.:
“The significant increase in the cost of health insurance over the last few years has been felt nationally. We know about its impact on our own pocketbooks. But the public often doesn’t realize this hits our schools hard economically and affects educational quality.”

http://asbointl.org/WhatsNew/index.asp?bid=5626

Comment: Educational quality is yet another victim of our failure to enact the changes that we know would improve access, coverage and affordability. If we know what to do, why aren’t we doing it?

Posted by pnhp at 10:47 AM | Permalink

BMJ
March 13, 2004
Use of hospitals, physician visits, and hospice care during last six months of life among cohorts loyal to highly respected hospitals in the United States
By John E Wennberg, et al

Academic medical centres in the United States with reputations for excellence differed dramatically in the care they provided to patients during the last six months of life.

…physicians have been shown to adapt their decisions about admission and discharge to the availability of intensive care unit beds, admitting more patients with lower severity of illness and extending their length of stay when more beds are available. In the light of this evidence, the likely explanation for the variations in acute hospital care and physician visits is variation in bed and workforce capacity relative to the size of population loyal to the 77 hospitals.

http://bmj.bmjjournals.com/cgi/content/full/328/7440/607

And…

The New York Times
March 13, 2004
An M.R.I. Machine for Every Doctor? Someone Has to Pay
By Reed Abelson

…doctors, their traditional sources of income squeezed, discover a new one: diagnostic imaging.

Instead of sending patients to a radiologist or one of four local hospitals, doctors in Syracuse have been particularly aggressive about installing imaging equipment - particularly M.R.I. machines - in their own offices.

There are signs that more machines may translate into too much imaging. Excellus points to data that suggest use of M.R.I.’s in Syracuse is two-thirds higher than in Rochester, for example, and higher than the national average.

http://www.nytimes.com/2004/03/13/business/13IMAG.html?8br

And…

Health Affairs
March/April 2004
Growth Of Single-Specialty Medical Groups
By Lawrence P. Casalino, Hoangmai Pham and Gloria Bazzoli

Using site-visit data from the Community Tracking Study, we show that specialists are increasingly forming large single-specialty medical groups, particularly in orthopedics and cardiology, where new technologies have increased the number of diagnostic imaging and surgical services that can be
provided in outpatient settings.

CTS site visits have provided little evidence that single-specialty groups, to date, are developing many of the organized quality-improving and cost-reducing processes to be expected in a focused factory. The current system pays specialists for increasing, not decreasing, the quantity and complexity of services provided and does not pay them for improving quality. Previous research has shown that physicians who own ancillary facilities tend to increase the amount of ancillary services they provide. Health plan executives at many CTS sites believe that increased specialist use of ancillary services is increasing health care costs.

http://content.healthaffairs.org/cgi/content/full/23/2/82

Comment: There is now ample evidence in the health policy literature to show that excess capacity in the health care system results in over-utilization, defined as an increase in utilization without a reasonably commensurate improvement in health care outcomes.

It is important to establish an optimum level of capacity ensuring that services will be there when needed but not enabling excessive utilization. A single payer system separates budgets for operation of the health care system from budgets for capital improvements, precisely for these reasons.

When we depend on market forces to establish capacity, the decision makers
head for the money. Thus, as Wennberg has shown in another study, Boca Raton
has a capacity that allows about a 30% excess in the level of services, but
without a demonstrable improvement in outcomes.

A single payer system not only establishes fairness in funding and in allocation of resources, but it also allocates resources more effectively. Will someone explain why we continue to support our current expensive but wasteful, less effective, and inequitable system when we know how to make it better?

Posted by pnhp at 10:41 AM | Permalink

Silicon Valley Biz Ink
(PRNewswire)
March 10, 2004
Health Care Costs Not a Difficult Problem for Most Americans

Majorities of the U.S. public say they know what their health care premiums, doctor visits, prescription drugs and deductibles cost while far fewer say they do not, according to the results of a recent new Harris Interactive poll conducted for The Wall Street Journal Online’s Health Industry Edition.

Overall, few found paying for health care difficult… Humphrey Taylor, chairman of The Harris Poll at Harris Interactive:

“The good news is that most people do not find it difficult to pay their insurance premiums or out-of-pocket costs. The bad news is that those who find it very difficult — up to 20 million adults — include many sick, low-income people who really need the care.”

http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=SVBIZINK4.story&STORY=/www/story/03-09-2004/0002125200&EDATE=TUE+Mar+09+2004,+02:52+PM

Comment: Although most Americans are concerned about the future affordability of health care, they are not yet having difficulties meeting the costs. The large majority, at any given point in time, are relatively healthy and have only modest or negligible health care costs.

Although many will develop significant medical problems and move into the minority sector with higher care costs, younger, healthier individuals will replace them, ensuring that the healthy will always remain a significant majority. As long as the financial exposure remains quite tolerable, this large, healthy majority may never become a potent force in the health care reform movement.

Will we ever have enough solidarity to support reform that would ensure affordable access to health care for the minority who do have significant
health care needs?

Maybe we are moving in another direction and instead developing solidarity on the contemporary modification of Russell Long’s famous quotation: “Don’t tax you, don’t tax me, don’t even tax that rich fellow behind the tree.”

Posted by pnhp at 09:59 AM | Permalink

LAURA BILLINGS: There’s a single solution to problems in health system

A column last week about the health care costs that have been the sticking point in negotiations with striking Metro Transit bus drivers seems to have struck a chord with readers. Several dozen wrote in with their own concerns about the crisis in health care, which I thought I’d answer here, while we wait for our rides …

These bus drivers don’t know how good they have it. They should just be grateful they get health insurance at all — a lot of us don’t.

True. There are an estimated 41 million uninsured Americans, despite the fact we spend twice as much on health care as the average spent in other developed countries that provide universal coverage. Here in Minnesota, we have 394,580 uninsured — about 8 percent of the population.

Why is it a company’s responsibility to pay for any of the coverage? When my grandfather came to America from Germany in 1898 he never expected anyone to pay for his health care — and if you couldn’t afford something you didn’t get it.

Well, a lot of businesses believe that providing health coverage to employees should no longer be part of the social contract. A business group in California is trying to turn back a new law requiring large companies to pay for 80 percent of their workers’ health care benefits. The group already has collected more than 620,000 signatures to get on the ballot in November. Businesses in plenty of other places are eager to see how this turns out, since rising health care costs are cutting into profits.

As for your grandfather, his logic might have held up better a hundred years ago, when a trip to the doctor wouldn’t have bankrupted you. Have you checked out your own HMO statements lately? I went to the emergency room for stitches recently and got a bill for almost a thousand bucks. Why does it cost so much? In part, because those of us who do have insurance end up subsidizing those who don’t.

The biggest problem is that people use medical insurance way too much, and bug their doctors for the tiniest things instead of toughing it out.

I swear I needed those stitches. The blood was everywhere! It’s true that unnecessary medical costs are a contributing factor, but there are 41 million bigger problems.

It’s these doctors that are the problem. They want to keep us from having national health insurance because they’d lose money, and wouldn’t be able to pay the greens fees at their fancy golf courses.

Take your shots, but the truth is that physicians may be more fed up with the way our health care system works than almost anyone. According to a Harvard Medical School study published last month in the Archives of Internal Medicine, nearly two-thirds of the 904 Massachusetts doctors they surveyed were in favor of single-payer national health insurance. Some 57 percent said they’d be willing to work under a salary system, and 67 percent said they’d even take a reduction in fees for a reduction in paperwork. Physicians feel your pain.

There’s no way this country could afford to give health insurance to everyone who doesn’t have it. The expense would be mind-boggling.

Not really. According to a report from the Kaiser Commission on Medicaid and the Uninsured, providing coverage for all 41 million uninsured Americans would increase health spending’s share of the gross domestic product by less than one percentage point — $34 billion to $69 billion a year, depending on which approach you choose. As for mind-boggling, the uninsured already use about $99 billion in medical care each year.

You do a great job defining the problem — now come up with the solution to health costs.

Better minds than mine have already proposed one. In fact, more than 8,000 physicians (including two former surgeons general and the former editor of the New England Journal of Medicine) back a plan proposed last summer by Physicians for a National Health Plan. They suggest building and expanding on the foundation of the current Medicare program, providing access to people of all ages and covering prescription drugs and long-term care. They say such a single-payer system would save more than $200 billion a year in administrative, marketing and other private industry expenses — more than enough to pay for people who don’t have insurance.

Why haven’t you heard about this? Because the only politicians willing to say the words “national health insurance” in public are Ralph Nader and Dennis Kucinich. Even though health care has reached a crisis stage, expect November’s election to be decided on more important issues like who gets to marry whom and prayer in the classroom.

Every time I read your column I think my head is going to explode.

That sounds bad. You should see a doctor about that.
————————————————————————————————————————-
Laura Billings can be reached at lbillings@pioneerpress.com or 651-228-5584.

Posted by pnhp at 02:27 PM | Permalink

Weak health care market forces lead to thoughts of government solutions

Health Affairs
March/April 2004
Are Market Forces Strong Enough To Deliver Efficient Health Care Systems?
Confidence Is Waning
By Len M. Nichols, Paul B. Ginsburg, Robert A. Berenson, Jon
Christianson
and Robert E. Hurley

The quest for greater efficiency in the delivery of health care services is eternal in a country that spends far more on health care than any other, consistently has growth in spending that outstrips that of income, is unable to provide insurance coverage to at least 15 percent of its population, and ranks poorly among industrialized countries in systemwide measures such as life expectancy and infant mortality. Add to this our quality problems, and it is hard to be complacent about the value U.S. citizens receive for their health care dollars. Inefficiency also puts a very high public-sector price tag on universal coverage, which helps polarize the politics of this issue.

Typically, all analyses of health system reform address the same key question: What and how much can markets do alone, and how much help might they need from government to produce more efficient outcomes or a more equitable distribution of health care resources? As we enter another season of broad debate about the structure of health care financing, the Community Tracking Study (CTS) site visits of the Center for Studying Health System Change (HSC) can make a unique contribution to analyses of the power and limits of market forces.

The CTS is a longitudinal study that tracks changes in local health care systems nationwide. Researchers conduct site visits to twelve randomly selected and nationally representative communities every two years to interview leaders of the local health care system about changes in the organization, delivery, and financing of health care and the impact of those changes on people.

We were struck by how many of our respondents-especially those traditionally
not predisposed to seek larger roles for government-echoed sentiments similar to the following. An insurance broker said, “The delivery system is a mess. The sectors don’t talk. No one wants to change. The government must do something.” A surprised benefit consultant reported: “There now is a lack of resistance to government involvement.” And capturing a sentiment expressed in many different ways, one local policymaker said, “If the private sector can’t figure all this out, it’s scary to think that we might actually end up running to government-I mean, HCFA!-to do it.”

The theme of “everyone feels constrained from changing his own behavior” cut
across many respondents’ views. Some kind of intervention stronger than what
has been tried before is thought to be necessary to force change. At the same time, there was general recognition that “fault” lies all around and that all sectors-including public programs-need to change their behavior for high-quality, effective health care to become more affordable in the long run. Perhaps it is this recognition of shared blame and shared self-interest in the status quo-plus a growing awareness in each community that health care creates jobs and contributes to local economic health-that has led a diverse array of leaders to begin to look to government as a focal point for a solution, at least as a convener or referee among stakeholders with diverse interests.

What is palpable across the twelve communities we studied is the recognition that private market forces are limited in their ability to achieve social objectives in health care services, and a growing sense that a broader conversation about what to do next should begin soon. This conversation may find more willing participants than would have been possible four to six years ago.

http://content.healthaffairs.org/cgi/content/abstract/23/2/8

Alain Enthoven responds (excerpts):

It is late, probably too late, to avert the inexorable progression to “Medicare for All.” U.S. employers would need to have an epiphany soon. But when it comes to health care, most of their horizons are so limited and their vision so constrained that such a change seems unlikely. What is becoming most likely is that the winning candidate in 2008 will make “Medicare for All” a foundation of his or her platform. And employers, incapable of controlling costs and desperate to get medical expenses off their financial statements, will lead the candidate’s campaign finance committee. Labor and small business will join them. The large and growing numbers of uninsured, by then reaching well into the middle class, will consider the issue to be of top priority.

Medicare for all will end up with an impasse like Canada’s, only much more
costly. The Medicare model will not deliver efficient health care systems. A
properly structured market model, based on existing demonstrated successes,
could.

http://content.healthaffairs.org/cgi/content/abstract/23/2/25

Comment: A final quote from the Nichols, et al article: Given how emphatically the nation rejected substantially more government involvement in health care decision making via the Clinton Health Security Act, it is a testament to the extent of malaise among private health care market participants today that a willingness to reconsider major government involvement surfaced frequently in our interviews during our 2002-03 site visits. At the same time, many respondents quickly added caveats such as, “But we can’t say that out loud.” Thus, the next system overhaul discussion period is likely to be long, for much political and educational work will have to precede any consensus decision to intervene in particular ways.

Posted by pnhp at 09:47 AM | Permalink

Reuters
Mar 5, 2004
Health Insurance Crisis Lingers for Biz
By Chris Morris

Friends held a benefit for Tony Thompson at the Hard Rock Cafe in December.
Thompson, one of the best-known drummers of the ‘70s and ‘80s, had died Nov.
12 after being diagnosed with renal cell cancer. Doctors had removed one of
his kidneys, but by then the cancer had spread to his lungs and liver.

Thompson was uninsured.

“He couldn’t afford it,” says his widow, Patrice Thompson. “When I met him,
he had no money.”

Patrice now faces hospital and medical bills that she calls “astronomical.” In 2002, the nonprofit Washington, D.C.-based Future of Music Coalition (FMC) conducted an online survey and found that 44% of its 2,400 musician respondents did not have any health insurance.

Widow Patrice Thompson:

“I don’t understand how it has gone on this long without somebody doing something about it, or at least pitching a bitch about it.”

http://www.reuters.com/newsArticle.jhtml?type=musicNews&storyID=4509891

Comment: It might be expected that a fragmented, patchwork system of health
insurance coverage that depends on variables such as employment, job stability, financial resources and other similar factors would not serve musicians well. This flawed system has failed to reduce the problems of the uninsured. And the rest of us are paying too much for coverage that is progressively deteriorating.

We can easily fix our system of funding health care so that everyone would
have permanent, comprehensive coverage. But if we limit our efforts to patching our existing fragmented system, the problems of the musicians and the rest of the uninsured will never be resolved.

Posted by pnhp at 03:19 PM | Permalink

Center for American Progress
March 3, 2004
Keep America Working: Restoring Jobs to Ensure American Prosperity
An Address by Sen. Hillary Rodham Clinton

American companies that continue to try to keep up with health care and pension costs find it increasingly difficult to do so. We are seeing now double-digit increases in health care, and we’re seeing the collapse of many of our pension systems that are basically being held aloft by a lot of accounting and prayers.

So how do we deal with this? Well, we can deal with it in a patchwork, incremental fashion, but eventually we’re going to have to decide. We’re
going to have to decide, are we going to provide a more level playing field
for our manufacturers by figuring out a way to deal with those legacy costs
which were, remember, built up because they thought they were doing the right thing for American workers and their families? Are we going to figure out a more sensible way to deal with health care and pension costs? Or are we going to continue to try to shift those burdens so that more and more is put on the employee and the employer and we have no end in sight of the increase in cost.

It’s also clear that this set of issues is politically volatile, as I can attest from my efforts ten years ago. And perhaps, though, the time is slowly coming. We weren’t ready ten years ago, we didn’t really understand the full cost of what we were up against, but it’s becoming more and more difficult to ignore the implications of these policies for the economy, and there have to be some attempts to reach a consensus that begins to solve these problems…

http://www.americanprogress.org/site/pp.asp?c=biJRJ8OVF&b=35989
Comment: “… patchwork, incremental fashion…”? “… eventually we’re going to have to decide.” “… the time is slowly coming.” The time has come. The question is no longer whether we need changes but what those changes will be.

Although Sen. Clinton will not be able to lead the charge since she spent most of her political capital on her prior attempt at reform, at least she is venturing out with guarded rhetoric revealing that she does understand that incremental patches simply will not do it.

Posted by pnhp at 11:05 AM | Permalink

A Heftier Dose To Swallow Rising Cost of Health Care in U.S. Gives Other Developed Countries an Edge in Keeping Jobs
By Kirstin Downey Washington Post Staff Writer 3/06/04

For each mid-size car DaimlerChrysler AG builds at one of its U.S. plants, the company pays about $1,300 to cover employee health care costs — more than twice the cost of the sheet metal in the vehicle. When it builds an identical car across the border in Canada, the health care cost is negligible.

In the battle for manufacturing jobs, the United States has always been at a disadvantage compared with underdeveloped countries where wages are low. But the rapidly rising cost of health care in the United States means that even developed countries sometimes have an edge when it comes to keeping jobs, according to interviews with dozens of corporate executives, legislators and health care consultants.

The United States has lost nearly 3 million manufacturing jobs since July 2001, with 43 consecutive months of manufacturing-employment decline, from about 17.3 million jobs to about 14.3 million in February 2004. During the same period, the manufacturing workforce in Canada has generally remained stable, at about 2 million jobs, even though the unemployment rate is higher there, at 7.4 percent, than in the United States, where it is 5.6 percent.

And, although both nations lost auto manufacturing jobs in 2000 and 2003, the decline was only 4 percent in Canada, compared with 14 percent in the United States.

Jim Stanford, an economist with the Canadian Auto Workers union, said employers who could operate in either country save $4 per hour per worker by choosing Canada. “That’s a reasonably significant differential. . . . It’s one of the reasons Canada’s auto industry has done a lot better,” he said.

In a joint letter circulated in Canada in November 2002, officials from Ford Motor Co., General Motors Corp. and DaimlerChrysler said “the public health system significantly reduces total labour costs . . . compared to the cost of equivalent private health insurance services purchased by U.S.-based automakers.”

High health care costs have “created a competitive gap that’s driving investment decisions away from the U.S.,” Ford Vice Chairman Allan Gilmour said in a speech at a recent auto industry conference. “If we cannot get our arms around this issue as a nation, our manufacturing base and many of our other businesses are in danger,” he said, according to a transcript of the speech.

Gilmour, who is leading a Ford study of health care, said it may be necessary to prod government officials to consider policy changes to reduce health care costs, although he declined to specify what changes should be made. “I do know that significant reform is necessary,” he said. “Right now the country is on an unsustainable track and it won’t get any better until we begin — business, labor and government in partnership — to make a pact for reform.”

But while the Big Three automakers told Canadians that their nationalized health insurance system helped preserve jobs, and lobbied the Canadian government last year to maintain the program, their corporate executives are not willing to go that far when it comes to health care in the United States.

Business trade groups here advocate small steps, such as helping workers care for themselves better, urging them to stop smoking and lose weight, and shifting costs to employees. The U.S. Chamber of Commerce, for example, backs such proposals as tort reform, electronic prescription writing and providing better information on the quality of care by doctors and hospitals.

The Bush administration has proposed some targeted efforts to help individuals pay for their care, through tax credits and health care spending accounts that officials say would lower taxes and help people pay for health care.

Most of Bush’s Democratic opponents for president would like to see more aggressive governmental action, ranging from Sen. John F. Kerry’s (D-Mass.) plan to expand care for poor children and create a federal insurance pool to help employers pay for catastrophic care to Rep. Dennis J. Kucinich’s (D-Ohio) proposal for a universal, single-payer system that would cut costs by eliminating insurance company paperwork.

Manufacturers outside the auto industry are also concerned about health care costs and employment.

“We can’t just continue to shift jobs out of the United States, not just manufacturing jobs, but all kinds of jobs, and health care is playing a role,” said William A. Rainville, chief executive of Kadant Inc., a Massachusetts-based manufacturer of papermaking equipment. “It’s like we’re in a stream with no control over it.”

Rainville said his company will spend about $6,500 on health care for each of its 525 U.S.-based employees this year, while health care costs for its 45 Canada-based workers are minimal. “Our U.S. workers are the most productive, but it doesn’t make up for the health care,” he said.

Rainville said he has considered moving production to Canada. “As an American it concerns me, but as a businessman, I don’t have much of a choice. You need to do what’s right for the business.”

The cost difference is striking. Employers in Canada pay only about $50 a month, or $600 a year, mostly for optional items such as eyeglasses and orthopedic shoes, said Elaine Bernard, executive director of the labor and worklife program at Harvard Law School. “Health care is significantly cheaper for corporations in Canada,” she said. U.S. employers pay more than 10 times as much — an average $552 a month per employee for health insurance, according to the Kaiser Family Foundation.

In the United States, General Motors spent $4.5 billion on health care last year for its 1.2 million American workers and retirees, at a cost of about $1,200 per car, said Tom Wickham, a GM spokesman. Ford spent $2.8 billion last year on health care, a Ford spokeswoman said. DaimlerChrysler spent $1.4 billion on health care for its 97,000 U.S. workers and 107,000 retirees last year, for an average cost of $1,300 per mid-range car priced at $18,600, said Thomas J. Hadrych, the company’s vice president of compensation, benefits and corporate services. “The reality is it is a significant cost element we struggle with on a year-over-year basis,” Hadrych said.

Meanwhile, the number of people insured by their employers is shrinking, which means that employers who continue to pay for employee health care must pay more. Employer health care costs rose 12 percent in the past year, on top of a 16 percent increase the previous year, according to Towers, Perrin, Forster & Crosby Inc., a human resources consulting firm.

“This is the seventh straight year of double-digit price inflation,” said Helen Darling, a former Xerox Corp. executive who heads the National Business Group on Health, an association of 182 companies. “Prices started climbing in the bubble economy, but companies then were making a lot of money, everybody was living like they made a lot of money,” and the escalation was relatively unnoticed at first, she said.

After the economy began to slump, however, executives began to worry. They shifted some of the growing cost to employees by raising insurance premiums and co-payments. Other companies have stopped offering health insurance or have raised premiums so high that some workers can’t afford them.

Most other industrialized countries — Canada, Japan and those in Europe — have government-funded health care systems with universal coverage. Canadians, for example, pay higher income taxes and a 15 percent sales tax to support the nationalized health care system.

“Suffice it to say Canada and Germany have a socialized form of health care” that delivers quality care at a lower cost for a larger number of people, without placing all the expense on employers, said Hadrych, of DaimlerChrysler. “The burden of it falls on the government, not just on employers,” he said. In the United States, “we carry the full brunt of it.”

Hadrych said political pressure on the health care system a decade ago, when the Clinton administration proposed changes, helped keep prices down for several years, but when the political pressure eased, companies began increasing their prices again. He said he believed the country was moving toward what he called a “more comprehensive” solution to the problem in 2001, but that the Sept. 11, 2001, terrorist attacks diverted everyone’s attention.

“Prior to 9/11, we saw a lot of interest on the Hill with respect to the health care issues,” he said. “After 9/11, it all shifted,” and, he said, momentum for a bigger solution was “not there.”

“A lot of people think a single-payer system is better,” he said.

© 2004 The Washington Post Company

*****
Center for American Progress 3/03/04
Keep America Working: Restoring Jobs to Ensure American Prosperity
An Address by Sen. Hillary Rodham Clinton

American companies that continue to try to keep up with health care and pension costs find it increasingly difficult to do so. We are seeing now double-digit increases in health care, and we’re seeing the collapse of many of our pension systems that are basically being held aloft by a lot of accounting and prayers.

So how do we deal with this? Well, we can deal with it in a patchwork, incremental fashion, but eventually we’re going to have to decide. We’re going to have to decide, are we going to provide a more level playing field for our manufacturers by figuring out a way to deal with those legacy costs which were, remember, built up because they thought they were doing the right thing for American workers and their families? Are we going to figure out a more sensible way to deal with health care and pension costs? Or are we going to continue to try to shift those burdens so that more and more is put on the employee and the employer and we have no end in sight of the increase in cost.

It’s also clear that this set of issues is politically volatile, as I can attest from my efforts ten years ago. And perhaps, though, the time is slowly coming. We weren’t ready ten years ago, we didn’t really understand the full cost of what we were up against, but it’s becoming more and more difficult to ignore the implications of these policies for the economy, and there have to be some attempts to reach a consensus that begins to solve these problems…

http://www.americanprogress.org/site/pp.asp?c=biJRJ8OVF&b=35989

Don McCanne’s Comment: “… patchwork, incremental fashion…”? “… eventually we’re going to have to decide.” “… the time is slowly coming.”

The time has come. The question is no longer whether we need changes but what those changes will be.

Although Sen. Clinton will not be able to lead the charge since she spent most of her political capital on her prior attempt at reform, at least she is venturing out with guarded rhetoric revealing that she does understand that incremental patches simply will not do it.

Posted by pnhp at 05:29 PM | Permalink

Health-care critic battles on Doctor featured in film says system can be improved

BY ARZA BARNETT, THE COURIER-JOURNAL

Dr. Linda Peeno, center, talked with Dr. Betty Straub, left, as Sister Mary Rhoads Buckler listened before the showing of the film “Damaged Care.” Peeno and Buckler were portrayed in the film.

In the two years since the release of a movie depicting her battles with the managed health-care industry, Dr. Linda Peeno has heard a lot from the companies involved, she said last night.

What surprised the Louisville physician, though, was hearing from many industry employees who say they know that denying care for financial reasons is wrong.

“I hear this over and over and over again,” Peeno said after a showing of the 2002 movie, “Damaged Care,” at an event at Central High School, 1130 W. Chestnut St.

“I’ve been able to be the voice for a lot of people who haven’t been able to speak up,” Peeno told an audience of about 60 people who identified themselves as doctors, nurses, teachers, labor and religious leaders, and “citizens.”

The event was organized by Kentuckians for Single Payer Healthcare, a group that advocates national health insurance, including a bill before Congress.

The Showtime cable-television movie, which was critical of corporate managed care, starred Laura Dern as Peeno. It tells the story of Peeno’s difficult personal and professional life, including a failed marriage and her battle with Humana Inc.

Peeno, a native of Hodgenville, Ky., has a medical degree from the University of Louisville specializing in internal medicine and infectious diseases. She worked in the 1980s as a medical reviewer for Humana Inc. and as medical director at Blue Cross/Blue Shield Health Plans.

The film shows how she became disillusioned with managed-care systems and eventually left to serve as an expert witness in cases involving insurance companies accused of denying care.

Peeno said that one of the lessons of the movie — and a theme she still advocates — is the need to change the corporate system of health care in the United States.

“We hear constantly that we have to allocate resources,” Peeno said, describing those who want to let the free market solve the nation’s growing health-care crisis. “But there is more than enough money in our health-care system to have quality care.”

She cited what she said were high salaries and profits in the industry. At the time of the movie’s debut, Humana officials said that it was inaccurate and that the company is dedicated to the health and welfare of patients.

Asked what impact she has had on the managed-care system, Peeno paused, then answered, “I like to think that at least part of what I have done was begin to articulate what an ethical health-care system is.”

Peeno has traveled widely around the country in recent years on court cases and for other health-care related events, she said.

“One of the effects I’ve seen is of the complete dispiriting — almost a gutting of the spirit — of health-care professionals, from doctors all the way down,” she said.

Peeno said she didn’t necessarily blame the workers in the managed-care system.

“We’re not talking about evil people, bad people,” she said. “At the basis of it, it’s the way we’re organizing the system.”

Asked about whether managed-care corporations had changed since the years depicted in the movie, Peeno said she had once thought they would “magically straighten up” after a few years of public exposure of their flaws, through lawsuits and other public actions.

But that hasn’t happened, she said.

Instead, industry representatives have argued that practices like those in the movie were “the old way,” she said.

That achieves the same effect of putting profits before people, “but doing so more subtly” by using “layers of organization” and “various ways of eluding responsibility and accountability,” Peeno said.

Event organizers called for support of the Medicare for All Act, proposed by Rep. John Conyers Jr., D-Mich. The bill would provide for a single-payer national health-care system with universal coverage.

Peeno said she supported the bill but added, “No single piece of legislation is going to solve the larger problem of this system and how we all live together in this society.”

Posted by pnhp at 02:03 PM | Permalink

Health Affairs
February 25, 2004
The Cost Of Tax-Exempt Health Benefits In 2004
By John Sheils and Randall Haught

It is important to understand that the tax expenditure for health benefits accrues to workers rather than employers.

We have defined “tax expenditure” as the additional taxes that would be paid
if these benefits were included in taxable income. This depends on the marginal tax rate of the workers receiving these benefits (which varies with personal income and filer type) rather than that of the employer providing them.

We estimate that the average health benefit tax expenditure will be about
$1,482 per family in 2004. However, it is heavily skewed toward high-income
groups. The average will be $2,780 for families with incomes of $100,000 or
more per year, but only $102 for families with incomes of less than $10,000
per year. This reflects the fact that families with relatively higher incomes are more likely to have employer coverage and are in higher tax brackets.

Proposals have emerged that would replace the current health benefit tax
expenditure with a refundable tax credit. Workers would be required to count
the value of employer-sponsored health benefits as income when computing
their taxes, which would increase their incentives to enroll in less costly
health plans. A refundable tax credit of perhaps $1,500 for individuals and
$3,500 for families would be provided to all Americans and would be phased
out as income rises. This would refocus the health benefit tax expenditure
on lower-income people to help the uninsured obtain coverage. The tax credit
also would be available for all health insurance including nongroup coverage
(excluding Medigap), which does not now qualify for tax preferences.

However, these proposals raise several concerns. For example, eliminating the relative tax advantages of employer coverage could cause some employers
to stop offering coverage, assuming that their workers will purchase their
own nongroup coverage with the help of the tax credit. Without a mandate for
all to offer coverage, this could result in a partially offsetting increase
in the number of uninsured people, as the convenience and economy of employer-group coverage disappears. Also, nongroup insurance,which is difficult to obtain in many areas, is much more costly to administer than group coverage, so overall costs would increase. These problems must be addressed before these types of tax credit models can be a viable alternative.

http://content.healthaffairs.org/cgi/content/abstract/hlthaff.w4.106

The full report:
http://content.healthaffairs.org/cgi/reprint/hlthaff.w4.106v1.pdf

Comment: Taxpayers currently are paying for health care for higher income
individuals, which is a benefit that lower income individuals do not receive. Current tax preferences for employer-sponsored plans are highly inequitable because of their regressive nature.

Several policy analysts have suggested discontinuing this inequitable tax
treatment of employer-sponsored plans, and replacing it with refundable tax
credits. Employers would welcome this opportunity to shift the responsibility for obtaining coverage to the employee who would then have to turn to the individual market. But the inequities of the individual market are much more profound than is the current tax injustice. And it is highly unlikely that standard policies could ever be established that would ensure equitable coverage and affordability within the private plan marketplace.

Why do we keep considering all of these other deficient schemes when an
equitably-funded universal system of social insurance would work just
fine?

Posted by pnhp at 10:25 AM | Permalink

Daily Herald
3/2/2004
Optimism in key sector
By Mike Comerford

Large scale layoffs in the last three years have been headline grabbers but keeping the local economy afloat has been the steady strength of area small
and mid-sized businesses.

An optimism index compiled by the National Federation of Independent Business indicates optimism in the small business sector in the first quarter of this year was higher than any quarter of the go-go 1990s and near an all-time record.

An eyebrow raising 17 percent of small businesses said they plan to hire employees in the next three months. Banks are vying to capture growing smaller companies, 25 percent of whom said this quarter they intend to expand their businesses. That’s near a pace not seen since the mid- 1980s.

Small businesses, according to the National Federation of Independent Business, also say they are re-building their inventories. Historically, taxes have been the biggest worry on the minds of managers at small businesses. But this year, health insurance costs were the single-biggest problem, they told the business association.

“The only fly in the ointment is health insurance,” said Bill Dunkelberg, chief economist, National Federation of Independent Business. “Consequently, about 40 percent of small businesses don’t offer health-care insurance.”

http://www.dailyherald.com/search/main_story.asp?intid=38048121

Comment: Small businesses are thriving, thank goodness. But the escalating cost of health insurance has driven small businesses to look for solutions such as association health plans and consumer-directed products. Although these approaches would provide relief for the business owner, they shift costs to the employee-patient, making essential care unaffordable for many. And close to half of the employers have already abandoned any attempt to provide health care coverage.

It really is time to end our inadequate and wasteful system of employer-sponsored private plans, but not until we have in place a better alternative.

Small businesses should join with us in advocating for a more affordable and
more equitable system of universal social insurance. It’s good for business.
It’s good for employees. And it’s good for all of us.

Posted by pnhp at 09:38 AM | Permalink

Center for Information Technology Leadership
February 23, 2004
New Findings Show that Investment in Standardized Healthcare Information Exchange Would Deliver $87 billion in Annual Healthcare Savings

“Our research shows conclusively that there are strong financial reasons for the nation to invest in standardized healthcare information exchange,” said Blackford Middleton, MD, Chairman of CITL. “Standardized information exchange would save the nation $86.8 billion each year. Clearly, we must accelerate efforts to focus national policy discussions on implementing standardized healthcare information exchange and interoperability.”

Dr. Middleton announced the results of CITL’s research into the value of Healthcare Information Exchange and Interoperability (HIEI) at the HIMSS
Annual Conference, February 23, in Orlando, Fla. The study considered four
levels of interoperability, but the conclusions focused on the financial value of moving to nonstandardized, machine-organizable data and standardized, machine-interpretable data. CITL found that the value of standardized HIEI far exceeds the value of non-standardized HIEI. The research concludes that it is not cost effective to invest in non-standardized HIEI.

HIEI generates savings by enabling automated sharing of data among the computers of participants involved in clinical treatment. Currently, 90% of data is shared manually via telephone, fax, and mail, and one study found that pertinent patient data were unavailable in 81% of patient visits to an outpatient clinic.

CITL calculated that savings would come from fewer tests and improved efficiency. CITL projected less redundancy and decreased labor costs from reduced administrative tasks. The results should be viewed as conservative estimates of the value of HIEI, since CITL considered only transactions that involve providers. In addition, it assumed that all providers would purchase new systems. Overall, CITL believes that actual financial benefits would be even higher than its projections.

http://www.citl.org/news/HIEI_Findings.pdf

Comment: One of the advantages of a single, universal system of funding health care is that it would be simpler and less costly to include an integrated information technology system. Although the benefits are not disputed there has been some concern about the costs of such a system. This report allays those fears.

The precise amount of savings would vary under different specific models, but the savings would be real if the health care information exchange and interoperability (HIEI) is standardized. In contrast, our current non-standardized approach is clearly not cost effective.

A single, universal program of social insurance is the ideal framework within which to establish a standardized HIEI. Let’s go to the drawing boards now.

Posted by pnhp at 09:31 AM | Permalink

Families USA launched its Medicare Road Show, a nationwide senior awareness campaign about the new Medicare prescription drug law. The launch featured the premiere showing of a new Families USA video, hosted by Walter Cronkite, to a group of D.C. area seniors. The video was produced to help seniors understand the new Medicare law. The launch also featured appearances by two seniors — Mildred Fruhling of New Jersey and Sydney Bild of Illinois — who were interviewed for the video. Mildred and Sydney talked candidly about the difficult time they’ve had finding the drugs they need at prices they can afford and how they expect the drug coverage offered by the new Medicare law will affect their out-of-pocket drug costs.

“Dr. Sidney Bild is a member of Physicians for a National Health Program and a retired pediatrician in Chicago. He is also the President of Metro Seniors in Action, where he has worked tirelessly for improvements in Medicare and for a single-payer national health insurance program.”

click here to view the article

Posted by pnhp at 04:39 PM | Permalink

Mon, 1 Mar 2004
Conservatives using HSAs to prevent a “socialized system”

MotherJones.com
March/April 2004
Medicare’s Hidden Bonanza
By Michael Scherer

For conservative leaders, the best part of the Medicare bill President Bush signed in December had absolutely nothing to do with Medicare. Rather, the provision that House Speaker Dennis Hastert calls “the most important piece in the bill” and former Speaker Newt Gingrich considers “the single most important change in health care policy in 60 years” is a little-noticed tax rebate set to cost the Treasury $6.4 billion over the next decade. The measure allows Americans to open tax-free “health savings accounts,” which can be used to pay medical bills-in effect removing their owners from the shared risk that has been the core of the health-insurance system since World War II.

For conservatives, a key selling point of health savings accounts is the potential effect on the future of health care: In making their case to lawmakers, (Golden Rule Insurance Co.’s Chairman Emeritus J. Patrick) Rooney’s allies cited polls showing that two-thirds of Americans support government-run, universal health care. By giving a large segment of the population the option to withdraw from the health-insurance system, they argued, health savings accounts could serve as a poison pill preventing another “Hillarycare” debate. “It’s going to be real hard to socialize the system if everybody has their own account,” explains John Goodman, head of the conservative National Center for Policy Analysis.

http://www.motherjones.com/news/outfront/2004/03/02_401.html

Comment: There is no question that the agenda of the conservatives is to shift the responsibility for funding health care away from collective pools, whether public or private, and onto the individual patient. They correctly perceive that health savings accounts will create a formidable political body of individuals who will have been able to reduce their health insurance premiums, funds which would otherwise be lost forever, and deposit the savings into their own personal accounts.

Because of the regressive tax policies of HSAs, higher income individuals will even receive taxpayer assistance in paying for their health costs. And if they remain healthy, they can eventually use their own accounts as a retirement plan. For the large sector of our society composed of relatively young, healthy individuals who have decent incomes, HSAs are a very good deal, providing adverse medical events do not occur.

But is this really a formidable force that will inevitably oppose universal coverage? HSAs that are not depleted become almost identical to individual
retirement accounts (IRAs) at age 65. What would be the response of this group if we adopted a universal health insurance program and told these individuals that their HSAs would no longer be exposed to the risk of medical bills but would be converted into permanent IRAs? The mere establishment of HSAs does not preclude political support for universalinsurance.

In the interim, funds that will be diverted into these accounts will have been removed from the collective risk pools. Funds to provide care for those with health care needs will be even less available. The crisis in health care funding will increase in intensity. More suffering will occur as health care becomes less and less affordable for individuals with needs.

We really do need to fix the funding of our health care system now.

Posted by pnhp at 11:30 AM | Permalink