New legislation would create an interim task force to delve into creating such a system
By Diane Lund-Muzikant
The Lund Report (Portland, Ore.), Feb. 1, 2017
The recent study by the RAND Corp. that looked at the feasibility of a single payer system has given renewed hope to advocates, while concerns are being raised about how such a system would play out financially.
Sen. Michael Dembrow (D-Portland), whose legislation gave the impetus for the RAND study, is fully aware that more work lies ahead. He’s making arrangements for the principal investigator who conducted the study to meet with the healthcare committees later this month to discuss the findings, and intends to draft legislation to create an interim committee that can take a deep dive into this issue after the session adjourns.
“Broadly speaking, the study gives us a lot to work with; I’m not sure I agree with all their conclusions, but I think it’s an important first step,” Dembrow told The Lund Report. “The RAND Corporation wanted to come up with something that looks soberly at the positives and the negatives in a way that provides some direction for us and to look at what factors to take into consideration when crafting something that works for Oregon. That’s why they’re coming to Oregon to talk about their assumptions and recommendations; it’s part of their contract.”
RAND concluded that more people could be covered under a single payer system with a higher quality of care for the same amount of money that’s being spent currently. Their analysis also concluded that providers would see their reimbursement levels decrease, which may not necessarily be true, said Dembrow because there would be fewer administrative hurdles under a single payer system.
Now that the Republicans control the federal government, the timing of this study is creating more urgency since Medicaid could be turned into a block grant program. “Oregon needs to figure out what’s working best, and that could give rise to a single payer system,” Dembrow said.
He also doubts there was any interference from Healthcare Management Associates, whose managing principal, Tina Edlund, had been the acting director of the Oregon Health Authority prior to Lynne Saxton. HMA consulted with RAND on the status of the coordinated care organizations that provide care to more than 1 million Oregonians. “RAND wanted to look at how the CCOs are working and how different processes could interface,” Dembrow added.
RAND made incorrect assumptions about the administrative savings, according to Charlie Swanson, legislative committee chair for Health Care for All Oregon Action, who also sits on their board. Their researchers only looked at the savings from insurance companies and not provider offices, concluding that a single payer system would save 11 percent of costs. However, they referenced $600 million rather than the $4 billion that would have been realized from Oregon’s $36 billion total in 2015.
Healthcare costs in the state are expected to reach $46-48 billion by 2019, according to the Kaiser Family Foundation.
“RAND either shortchanged or misunderstood the administrative savings,” Swanson said.
RAND was given a difficult task to figure out what the federal legislation would permit states to do, and there’s an enormous grey area, particularly with respect to ERISA which prevents states from regulating employer benefits to create a universal healthcare plan, according to Dr. Sam Metz, a long-time advocate of a single payer system, who’s a member of Oregon Physicians for a National Health Program and a founding member of Mad as Hell Doctors.
He’s hopeful legislators will take the time to review the study in-depth, and realize that healthcare reform needs to move toward a universal system.
“Regardless of what we think of CCOs, Oregon’s overall spending in healthcare has not gone down, and there’s not been a reduction in medical bankruptcies, or an improvement in overall public health,” Metz said. “Medicaid is not a model for universal care. We know Oregon is uniquely vulnerable to federal policy because we have a larger Medicaid burden. We can provide better care to more people without requiring more money in a single payer system.”
But change doesn’t come easy when Oregon is spending close to $40 billion on health care, which is the largest single sector of its economy, he added. “When we change how that money flows even a little, some people are going to lose millions of dollars, and they’re going to make more noise than the people who gain money. Changing this industry and the health of Oregonians will require substantial leadership within the industry at great risk to itself, and will require a critical mass activated voters to tell legislators they have their back when it comes to the next election.
“Voters don’t have to solve the impending healthcare crisis, but they need to tell legislators to find the right answers. In the U.S. today, more people die of treatable diseases because don’t have money for treatment than are shot to death, and the loss of healthcare is a greater risk to our families than foreign-born or native-born terrorists,” Metz added.
RAND also concluded that providing more care to more people would lead to congestion in the system. “This congestion the RAND report warns us about sounds like a giant economic stimulus for Oregon; it means there’s a new need in Oregon not just for neurosurgeons, but for nurse practitioners, home health aides, workers in hospital cafeterias and construction workers to build new clinics,” Metz said.