PNHP

N.H. House stands behind single-payer plan

N.H. House stands behind single-payer plan

By Shir Haberman
Portsmouth Herald
Thursday, March 29, 2007
shaberman@seacoastonline.com

PORTSMOUTH — The lack of federal action in finding solutions to the multitude of problems that have led to the national health care crisis has frustrated states suffering from the results of that crisis.

Nowhere is that more evident than in New Hampshire, where no less than 250 individual pieces of legislation were filed this year in an attempt to address various aspects of the problem. They range from a bill that would establish a committee to study just what is driving the cost of health care up in the state, to extending insurance coverage for the use of midwives, to establishing an electronically controlled drug prescription monitoring program.

However, the strongest indication of the bind the state finds itself in as a result of the inactivity of federal lawmakers may have been the passage of House Concurrent Resolution 5, which endorses the National Health Insurance Act put forth by Rep. John Conyers, D-Mich. The resolution passed the New Hampshire House on March 21 by almost a 2-to-1 margin.

“It’s very exciting,” said Portsmouth physician Thomas Clairmont, who was the impetus for the resolution. “It will open up the debate, because now when these (presidential candidates) come to speak before the Legislature, they will know where that body stands on health care.”

Conyers’ legislation establishes a new American national health insurance program by creating a single-payer health care system. The bill would create a publicly financed, privately delivered health care program that uses the already existing Medicare program, aiming to expand and improve the program for all U.S. residents.

The reasons for the overwhelming New Hampshire support for Conyers’ legislation were listed in the body of the resolution. They included:

* The fact that approximately 135,000 New Hampshire citizens lacked health insurance in 2006, and those insured now often experience burdensome medical debt.

* An estimate that half of all personal bankruptcies in the state are due to illnesses or medical bills, among other issues.

State Rep. Jim Splaine, D-Portsmouth, said he and state Rep. Paul McEachern, D-Portsmouth, sponsored HCR 5 “because we wanted to make it clear that a single-payer, national health care system is what New Hampshire and the nation need.”

“There were some concerns about cost,” he said of the House State-Federal Relations and Veterans Affairs Committee, which considered the bill. “But most saw the eventual savings a single-payer system would result in.” The committee voted 9-6 to recommend passage of the resolution.

The cost of Conyers’ bill has been estimated at $1.86 trillion a year. However, it is estimated that Conyers’ plan would save more than $150 billion on paperwork alone in the first year and another $50 billion by allowing Medicare to negotiate a bulk purchasing discount for medications.

Splaine said the HCR 5 must now go to the Senate for passage. He said he is optimistic about its chances there.

As a lead-up to the visit by Illinois Sen. Barack Obama Tuesday for a “Community Meeting on Health Care,” an article on this issue will appear each day in the Portsmouth Herald. We invite readers with stories to tell to contact Shir Haberman at 570-2230 or shaberman@seacoastonline.com.

In health care reform, California needn't settle for second best

By Kay McVay, RN
San Jose Mercury News
03/29/2007

Anyone worried about the cost and availability of health care should be very wary of some of what’s being said about health care reform in California.

SB840, state Sen. Sheila Kuehl’s bill providing guaranteed health care as an expanded and improved version of Medicare for all Californians, is the gold standard reform. It’s the most comprehensive – and the only plan that controls costs by eliminating administrative waste rather than limiting care and shifting costs to families.

But, Sacramento insiders insist, SB840 is not palatable for a governor who has vetoed the bill once before.

Instead, the voices of political expediency are browbeating us to lower our standards and accept an inferior approach such as Gov. Arnold Schwarzenegger’s proposal to force Californians to buy unaffordable, substandard health plans.

Under this plan, a typical Santa Clara County family could end up spending more than $12,000, nearly one-fifth of their annual income, on insurance premiums and deductibles before their insurance company spends a dime on their medical care.

If a medical emergency occurs, out-of-pocket costs could rise to 25 percent of household income, and this minimal insurance would probably exclude such basics as dental, vision, mental health and long-term care. They would all cost extra.

There is a better path: SB840.

Since Schwarzenegger vetoed a similar proposal last year, momentum for a real solution has grown in California and across the nation.

A recent New York Times-CBS poll shows 64 percent of Americans believe the government should guarantee health insurance for all; 55 percent identified it as the top domestic priority for Congress and the president. In California, 60 percent favor a publicly funded universal health care system, like SB840 and Medicare, over the current system. The public is ahead of the politicians and policy wonks.

Schwarzenegger now says he’s for a “universal” system, although it’s cloaked in mandated, high-deductible insurance policies.

With majorities in both the Senate and Assembly, the Democrats call the shots on health care reform. It’s their decision, not the governor’s, what health care reform will pass the Legislature.

If they unite behind SB840 – which Senate President Pro Tem Don Perata in January called the “benchmark” and “ultimate solution” for our health care crisis – they have the power to make that the only plan that Schwarzenegger can sign or veto, just as they did last year.

Why should the Legislature take that step?

Premiums have jumped 87 percent in six years. SB840 is the only reform that contains costs while increasing benefits, primarily by curbing administrative waste and insurance industry profits. In California, that’s $20 billion per year.

The insurers are the principal opposition to any systemic reform. To successfully counter their elephantine influence – through the millions of dollars the insurers spend on campaign contributions – legislators need the public support generated by a guaranteed health program of quality care for all.

Would Schwarzenegger ever sign a bill detested by his insurance industry donors, who don’t want anyone interfering with their profits? A recent Datamar poll found that voters who support what the governor says he wants to accomplish also favor SB840; they want a solution that works, not a windfall for insurers.

Registered nurses are used to fighting the insurance companies for the care our patients need.

In 2004, the governor issued an emergency regulation to roll back key portions of the state’s landmark law requiring minimum safe nurse staffing levels in hospitals. The same experts who argue Schwarzenegger will never sign SB840 counseled nurses not to fight for patient safety because the governor was too popular and could not be challenged.

Instead, California’s nurses launched a spirited campaign and, with public support, ultimately persuaded Schwarzenegger to end his efforts to erode patient care standards.

There are dozens of other examples – from Social Security to women’s suffrage to ending legal segregation – that were achieved despite the perceived wisdom of the time.

Today, the public interest can prevail again. Schwarzenegger, who wants a grand accomplishment on health care for his legacy and on his re`sume` if he runs for another office, can be encouraged to sign a bill that will make all Californians proud, end our health care nightmare and set another model for the nation.

KAY MCVAY is president emeritus of the California Nurses Association. She wrote this article for the Mercury News

In health care reform, California needn’t settle for second best

By Kay McVay, RN
San Jose Mercury News
03/29/2007

Anyone worried about the cost and availability of health care should be very wary of some of what’s being said about health care reform in California.

SB840, state Sen. Sheila Kuehl’s bill providing guaranteed health care as an expanded and improved version of Medicare for all Californians, is the gold standard reform. It’s the most comprehensive – and the only plan that controls costs by eliminating administrative waste rather than limiting care and shifting costs to families.

But, Sacramento insiders insist, SB840 is not palatable for a governor who has vetoed the bill once before.

Instead, the voices of political expediency are browbeating us to lower our standards and accept an inferior approach such as Gov. Arnold Schwarzenegger’s proposal to force Californians to buy unaffordable, substandard health plans.

Under this plan, a typical Santa Clara County family could end up spending more than $12,000, nearly one-fifth of their annual income, on insurance premiums and deductibles before their insurance company spends a dime on their medical care.

If a medical emergency occurs, out-of-pocket costs could rise to 25 percent of household income, and this minimal insurance would probably exclude such basics as dental, vision, mental health and long-term care. They would all cost extra.

There is a better path: SB840.

Since Schwarzenegger vetoed a similar proposal last year, momentum for a real solution has grown in California and across the nation.

A recent New York Times-CBS poll shows 64 percent of Americans believe the government should guarantee health insurance for all; 55 percent identified it as the top domestic priority for Congress and the president. In California, 60 percent favor a publicly funded universal health care system, like SB840 and Medicare, over the current system. The public is ahead of the politicians and policy wonks.

Schwarzenegger now says he’s for a “universal” system, although it’s cloaked in mandated, high-deductible insurance policies.

With majorities in both the Senate and Assembly, the Democrats call the shots on health care reform. It’s their decision, not the governor’s, what health care reform will pass the Legislature.

If they unite behind SB840 – which Senate President Pro Tem Don Perata in January called the “benchmark” and “ultimate solution” for our health care crisis – they have the power to make that the only plan that Schwarzenegger can sign or veto, just as they did last year.

Why should the Legislature take that step?

Premiums have jumped 87 percent in six years. SB840 is the only reform that contains costs while increasing benefits, primarily by curbing administrative waste and insurance industry profits. In California, that’s $20 billion per year.

The insurers are the principal opposition to any systemic reform. To successfully counter their elephantine influence – through the millions of dollars the insurers spend on campaign contributions – legislators need the public support generated by a guaranteed health program of quality care for all.

Would Schwarzenegger ever sign a bill detested by his insurance industry donors, who don’t want anyone interfering with their profits? A recent Datamar poll found that voters who support what the governor says he wants to accomplish also favor SB840; they want a solution that works, not a windfall for insurers.

Registered nurses are used to fighting the insurance companies for the care our patients need.

In 2004, the governor issued an emergency regulation to roll back key portions of the state’s landmark law requiring minimum safe nurse staffing levels in hospitals. The same experts who argue Schwarzenegger will never sign SB840 counseled nurses not to fight for patient safety because the governor was too popular and could not be challenged.

Instead, California’s nurses launched a spirited campaign and, with public support, ultimately persuaded Schwarzenegger to end his efforts to erode patient care standards.

There are dozens of other examples – from Social Security to women’s suffrage to ending legal segregation – that were achieved despite the perceived wisdom of the time.

Today, the public interest can prevail again. Schwarzenegger, who wants a grand accomplishment on health care for his legacy and on his re`sume` if he runs for another office, can be encouraged to sign a bill that will make all Californians proud, end our health care nightmare and set another model for the nation.

KAY MCVAY is president emeritus of the California Nurses Association. She wrote this article for the Mercury News

Administrative costs of tax credits

Administrative Costs for Advance Payment of Health Coverage Tax Credits: An Initial Analysis

By Stan Dorn
The Commonwealth Fund
March 2007

New federal initiatives to cover the uninsured are under serious discussion by national policymakers and interest groups. Such initiatives include many proposals to use fully refundable federal income tax credits to subsidize uninsured individuals’ purchase of coverage. In considering the merits of his approach, policymakers can learn from the country’s only current use of tax credits to cover the uninsured–namely Health Coverage Tax Credits (HCTCs), which were created under the Trade Act of 2002. HCTCs pay 65 percent of health insurance premiums for certain workers displaced by international trade and early retirees. The credits can either be claimed after the end of the year, when annual income tax forms are filed, or advanced monthly to health insurers to help pay premiums.

This issue brief examines an aspect of the HCTC program that has received little attention in prior research: the extent to which public dollars are spent on administrative costs, rather than on health care services.

During FY 2007, an estimated 13 percent of federal funding related to HCTC advance payment will be spent for health plan administration, 21 percent will pay IRS administrative costs, and 66 percent will purchase health care. This analysis raises serious questions about the efficiency of using federal income tax credits as a strategy to subsidize health coverage for millions of uninsured Americans.

http://www.cmwf.org/usr_doc/1017_Dorn_admin_costs_advance_payment_HCTC.pdf

Comment:

By Don McCanne, MD

One of the more important objections that many of us have had to the concept of using tax credits to help with the purchase of private insurance is that it would add to the administrative burden of a system already sinking from administrative overload. This study confirms that the increased administrative costs are not merely theoretical, but are very real.

After very high start-up costs, this program of advanced payments of tax credits continued to consume 34 percent of health care spending merely for the administrative costs of the health plans and the IRS. This did not include the costs of the administrative burden of the providers of health care, and it did not include the administrative costs of other involved entities such as labor unions, community agencies, State Workforce Agencies, volunteers, and others.

Those who contend that the private sector would be more efficient might have their enthusiasm mollified by the knowledge that 91 percent of start-up costs went to private contractors. Even if it were possible to improve the efficiency of this program, it would still involve very significant administrative expenses added on to the profound administrative waste that already uniquely characterizes our system.

There is a much more efficient mechanism of making health care coverage affordable for each individual than the use of tax credits. Simply establish a universal risk pool and fund it equitably through the tax system. The marginal administrative costs would be very low since we already have a tax system, and the high administrative costs of the complex, private-insurance premium system would disappear (except perhaps for elective supplemental coverage of non-essential services).

Tax credits are only one more scheme to try to protect the private insurance industry from its demise. When it is serving us so poorly, why would we want to do that?

Plug the health care drain

Spiraling insurance premiums threaten the state’s economic security. Moving to a single-payer system – public funding, private providers – just makes sense.

By Ron Forthofer
The Rocky Mountain News
March 24, 2007

Although health care is the top domestic concern of Americans, neither the Bush administration nor congressional leaders are willing to provide the leadership necessary to solve the crises confronting uninsured and underinsured Americans and U.S. businesses. Leading politicians continue to put campaign contributions from the health insurance and pharmaceutical industries ahead of the interests of other businesses and the American public. However, as U.S. businesses are faced with ever increasing health insurance premiums, more are willing to tackle the crisis and become a part of the solution.

In an October address, Dr. Henry E. Simmons, president of the National Coalition on Health Care, the nation’s largest health care alliance, said: “The escalation of health care costs is no longer only a health care issue. It has now created a gigantic national economic problem. For as these costs rise, they slow the rate of economic growth. By cutting into corporate operating margins, they reduce the capacity of firms to grow by investing in research, plant and equipment. And they put American firms at a steep disadvantage in world markets, where they have to compete against companies in countries with much lower health care costs.”

Ever-increasing health insurance premiums put small businesses in a bind. They often face the impossible choice of providing jobs or health insurance. In addition to the direct costs of insurance, each small business pays staff to deal with health insurance brokers/companies. Employers who can’t afford a staff person often conduct negotiations themselves. All this time and money spent on the complex array of health insurance “gotchas,” multiplied across thousands of small businesses in Colorado, represent millions of dollars that could be invested elsewhere.

Health insurance coverage also impacts the ability to attract and retain employees:

* If a small business doesn’t offer health insurance, potential employees may not consider its job openings.

* A business that offers insurance must be careful whom it hires since one person with a serious health problem could drive premiums sky high.

* A business providing health insurance is likely to have higher labor costs than a nonproviding competitor, putting it at a disadvantage in bidding situations.

Large businesses also are stymied. S. Gary Snodgrass, executive vice president of Exelon Corp., one of the country’s largest public utilities, said health coverage for its employees and retirees is its fastest-growing expense. Between 2001 and 2004, he said, those costs rose 70 percent, forcing the company to shift more of the burden to workers.

Ford Motor Co. spent almost $12,500 per hourly employee and retiree on health care expenses in 2002. William Clay Ford Jr., executive chairman of the board, said the rising cost of health benefits is the “biggest issue on our plate that we can’t solve. Health care is out of control. It’s a system that’s broke.”

In the fall of 2002, the Big Three automakers in Canada said: “The (Canadian) public health care system significantly reduces total labor costs for automobile manufacturing firms, compared to the cost of equivalent private insurance services purchased by U.S.-based automakers; these health insurance savings can amount to several dollars per hour of labor worked. Publicly funded health care thus accounts for a significant portion of Canada’s overall labor cost advantage in auto assembly, vs. the U.S., which in turn has been a significant factor in maintaining and attracting new auto investment to Canada.”

In June 2005, Toyota placed a new plant in Ontario instead of the United States, and health care costs were a key consideration.

The Canadian system reduces the role of the insurance industry – and, hence, the administrative burden on the health care system. Applying the Canadian model to the U.S. means that instead of having more than 1,200 private health insurers – each with its own costly bureaucracy and concomitant expenses – there would be only one group in each state dealing with administration. The Canadian health care delivery system is private, but the financing is public. It is a tax-based system costing far less than we pay in the U.S.

Health care expenses in the U.S. consume about 16 percent of our GDP vs. about 10 percent in Canada. The U.S. “system” is wasteful, with as much as 25 percent of premiums used for things other than health care. More importantly, the Canadian system covers everyone with comprehensive medical care, whereas our “system” fails to cover almost 47 million Americans, and another 30 million to 50 million are underinsured.

Studies by the Government Accounting Office and the Congressional Budget Office show that the single-payer system – public funding and private health care – can provide universal comprehensive coverage here and save money over the current failed market-based approach. These studies are supported by a May 2005 report by Kenneth Thorpe for the National Coalition on Health Care. Thorpe is the former top economist at the Department of Health and Human Services and now is chairman of the Health Policy and Management Department of Emory University in Atlanta. The report projected a saving of $1.1 trillion in the first 10 years under a universal, publicly financed system – even while insurance coverage is extended to every American and stronger quality measures are put in place, a far larger savings than other proposals for reforming the U.S. market-based health insurance system.

Under the single-payer approach, business saves because it would not waste resources researching health insurance decisions, and workers compensation costs would drop due to removal of the health care component. The playing field would be leveled in hiring and in competitive bidding. Uncertainty about health care costs would be eliminated. Large companies would boost their competitiveness in international markets.

Business can best protect its interests by supporting the single-payer bill now in Congress, H.R. 676. Among the 55 co-sponsors of this bill, none is from Colorado. If major surgery is not performed on the U.S. health care system, U.S. businesses and tens of millions of Americans will continue to pay a steep price for the failure to act.

Ron Forthofer is a retired professor of biostatistics at the University of Texas School of Public Health in Houston. A resident of Longmont, he was the Green Party candidate for governor of Colorado in 2002 and won 4 percent of the vote in Colorado’s 2nd Congressional District in 2000. He can be reached at ron_forthofer@yahoo.com.

The Corporate Crime of Selling Private Health Insurance

by The Corporate Crime Reporter

In most of the world, it is a corporate crime to sell private health insurance.That’s because most countries insure their citizens as a matter of right.

Private insurers dilute the public pool.

One nation, one payer.

Medicare for all.

Everybody in, nobody out.

No bills from the doctor.

No bills from the hospital.

No deductibles.

No co-pays.

No in network.

No out of network.

No corporate profits.

No threat of bankruptcy from health bills.

Health insurance will be the number one domestic political issue in the USA in 2008.

Polls indicate that the majority of the American people want single payer.

But who will deliver?

On Saturday, the Center for American Progress Action Fund and Service Employees International Union (SEIU) sponsored a forum in Las Vegas for presidential candidates to discuss health care.

No Republicans accepted.

Seven Democrats accepted.

All the candidates at the forum agreed that universal health care was the goal. (Even the Business Roundtable and the insurance industry now say they want “universal health care.”)

But only one – Congressman Dennis Kucinich (D-Ohio) – accepts the only answer that will work – single payer.

Medicare for all.

The rest – including Barack Obama, Hillary Clinton, Chris Dodd, Bill Richardson, Mike Gravel, and John Edwards – want some mixture of public and private health insurance.

They know this public/private mix won’t work – the healthy wealthy will buy private insurance, the sick poor will sign on with the government – and the government program will be crippled.

But they don’t have the guts to stand up to the private insurance industry and say – get out.

Kucinich has introduced single payer legislation (HR 676) in Congress that would make it unlawful to sell private health insurance for benefits that are medically necessary.

Last week, we entered the belly of the beast – the American Health Insurance Plans (AHIP) 2007 National Policy Forum at the Capital Hilton in Washington, D.C.

AHIP is the trade association for the companies that will be sacked if single payer becomes law.

We walked into a session titled – Coverage for All Americans: Putting Access at the Top of the National Agenda.

The session was moderated by AHIP President Karen Ignagni.

Not once during the 90-minute session was single payer mentioned.

Universal coverage, yes.

Single payer, no.

But during the discussion, the geography of nowhere was laid out.

On one side, Ron Pollack, executive director of Families USA had teamed up with AHIP’s Ignagni.

On the other, Bill Novelli, CEO of AARP and John Catsellani, president of the Business Roundtable.

AARP and the Business Roundtable have joined with SEIU to form something called Divided We Fail.

Divided We Fail is a corporate liberal answer to single payer.

All Americans should have access to affordable quality health care.

All Americans should have peace of mind about their future long-term financial security.

Families USA and AHIP do a separate dance but mouth similar platitudes.

But both Divided We Fail and Families USA/AHIP dismiss single payer as unworkable.

On the single payer side is Kucinich, about 60 members of the House of Representatives, the California Nurses Association, Physicians for a National Health Program, and Health Care Now.

Kucinich is now the single payer champion.

The problem with Kucinich, of course, is that if he doesn’t get the nomination, he will take the stage at the Democratic Convention in 2008 in Denver – as he did in 2004 in Boston – raise the hand of the corporate nominee and endorse the corporate platform.

Then where will we be?

Nowhere.

Again.

To visit the Crime Reporter’s home page, click here.

Association-sponsored coverage plummets

Health insurance options dwindle for self-employed

Group plans are being dropped or becoming unaffordable to many.

By Lisa Girion
Los Angeles Times
March 27, 2007

A major source of health insurance for people who work for themselves is disappearing, casting thousands of contractors, freelancers and solo practitioners into the ranks of the uninsured with little hope of obtaining new coverage.

Health plans offered by professional associations were once havens for millions of people who couldn’t get coverage anywhere else. But as medical costs have soared, groups representing professions as varied as law and golf have been forced to stop offering the benefit or been dropped by insurers.

More than 8,000 people with coverage through the California Assn. of Realtors could be next if Blue Shield of California succeeds with its plan to cancel the group’s health coverage.

“It’s a real stab in the heart,” said Marcy Garber, 62, an Encino real estate agent whose history of breast cancer makes her an almost-certain reject if she seeks similar coverage on her own.

Although no one tracks association coverage to know how many plans have disappeared, the experience of Marsh Affinity Services is telling. A decade ago, Marsh, which brokers and administers the health plans, had 142 such clients. Today, all but three have shut down.

In its heyday, association health coverage was so popular that brokers touted it as a membership recruiting tool for professional organizations. The demise of the coverage is particularly problematic in states like California, experts say, where a raft of jobs — including many in the service and entertainment sectors — don’t come with health benefits.

“The problem with associations is they go into a death spiral because they get the worst risk,” said Alan Fox, vice president of plan design for the American Psychological Assn. Insurance Trust, which covered thousands of psychologists and their families for 35 years before discontinuing its health plan in 1999.

As havens for people with medical conditions, association health plans are especially vulnerable to rising medical costs, said Janet Trautwein, chief executive of the National Assn. of Health Underwriters.

“Costs are going up everywhere in every type of plan,” Trautwein said. Associations “not only have the normal costs going up, but they have this adverse selection at the same time. It’s a double whammy.”

http://www.latimes.com/business/la-fi-insure27mar27,0,2749192,full.story

Comment:

By Don McCanne, MD

How many more examples do we need? Segregated health insurance risk pools are not effective for financing care of those individuals who have significant health care needs. We desperately need to establish one single risk pool, include everyone, and fund it equitably.

Republicans are well represented in these professional associations, but simply being a Republican will not provide financial security if you have breast cancer and have run out of insurance options. Reform is no longer a partisan issue. Moderates, conservatives and liberals should all have the health care they need, when they need it, without being exposed to the additional burden of financial hardship. We can do this together.

Health coverage for more people just helps insurers

By Milton Fisk
The Journal Gazette
03/26/2007

Suddenly, the most unlikely bunch has turned altruistic. Conservative businesses and politicians want health coverage for the uninsured. Schemes are multiplying about how to do it. Why the change of heart? Beware of those bearing gifts — this altruism is but poorly disguised self-interest.

Look at some apostles of this new altruism. Wal-Mart is an easy case; it hopes to use it to avoid paying any more for health benefits. Why Gov. Arnold Schwarzenegger? He hopes to garner more dollars for powerful private insurers he needs.

What are these schemes?

Common to all of them is the use of public subsidies so the uninsured can buy private insurance. However, spreading private insurance worsens the problems it creates.

The idea came from President Bush’s 2003 Medicare Plan D drug program, by which private insurers get public subsidies. It’s unadulterated corporate welfare. The drug companies get $40 billion a year more because Medicare can’t bargain over what it charges. The insurers’ ads and profits cost the government $5 billion a year.

With Medicare Plan D as inspiration, don’t expect much from our new altruists. Covering more people is an admirable goal. Getting it through private insurance will push inflation in health care through the roof. To modulate this inflation, we’d need public insurance — Medicare (A and B) is an example — extended to all.

In 2005, CEOs at five big insurers received together a total of $14 million plus stock options and grants for over 2 million shares. The aggregate profits in 2006 of these insurers were $12 billion. Still, their premiums have nearly doubled in the past decade. A public insurer seeks no profits, and its chieftains don’t become plutocrats.

Don’t stop here — there’s more to being an expensive parasite. Premiums for private insurance go to marketing as well as health care: the TV ads, junk mail, public relations accounts to burnish a bad image and hucksters signing on employers and hospitals. There’s little of this waste with public insurance.

Then there’s the cost of underwriting — trying to find whose poor health warrants a bigger premium, whose pre-existing conditions will deny them coverage and who to dump from the rolls. This cherry-picking is absent with public insurance; there’s no extra charge or denial for bad luck or poor genes.

Schwarzenegger wants insurers in his state to devote at least 85 percent of premiums to health care. WellPoint says it devotes only 81 percent; as a California giant, its screams will get Arnold back on track. This bickering is juvenile when Medicare has overhead of 3 percent.

Hang on for more — add to private insurers’ overhead a ripple effect on providers. Doctors and hospitals must send bills to multiple insurers. With a single public payer, this inefficiency disappears. Hospitals won’t have to bill insurers; they will operate under annual budgets negotiated with that single payer.

Shouldn’t the competition between multiple insurers save money?

Free enterprise versus big government? That’s not the fight. It’s rather: Pay more or pay less?

When a new altruist says he or she wants more people covered, ask, “Do you want to expand business for private insurers or do you want to reduce inflation in health care costs by having a single public insurer?”

Milton Fisk, a Bloomington resident, is a member of Hoosiers for a Commonsense Health Plan. He wrote this for Indiana newspapers.

The Sacramento Bee on pooling risk

Editorial: Coverage for all

The Sacramento Bee
March 25, 2007

The state regulator of HMOs has fined one of the largest, Blue Cross, $1 million for canceling health policies of enrollees who, among other things, got pregnant. Cancellations like these weren’t isolated, according to the California Department of Managed Health Care. Rather, they were systematic, right down to a computer program that scours the system for enrollees seeking certain kinds of care.

Blue Cross denies wrongdoing. That’s fine. There is a larger lesson here: This health insurance market, the one for individuals or families who don’t automatically get covered through their jobs, is sick. Insurers try to avoid covering people who need care. And many Californians avoid getting insurance until it is in their financial interest to do so. It’s a game, and the game must end somehow. That can only happen by blowing up the individual health insurance market that exists today and replacing it with something that makes more sense. And that can only happen with the California Legislature and Gov. Arnold Schwarzenegger.

There are two basic choices here when it comes to health insurance. One is to get rid of private health insurance altogether and replace it with a program in which the government directly pays doctors and hospitals to provide care. That’s known as single-payer. It is championed by some Democrats, but opposed by the governor. Single-
payer isn’t a likely short-term compromise, but the more we look at this mess, single-payer seems to be an increasingly likely long-term solution because of the many ills of the private insurance market.

The second choice is to fix the insurance market. How? Bottom line: It means that health insurers such as Blue Cross have to cover all who apply, even those who are eight months pregnant. On the flipside, everyone — or just about everyone — has to have insurance. It can be through his or her company. It can be through a government-
sponsored program. What is important is to throw everyone into the pool. Insurance, when it works, is all about spreading risks.

Either the governor and the Legislature somehow create this pool, or they don’t. All of the solutions by necessity would impose various mandates — either on employers, on individual Californians or in some combination. And any solution will require money. Why? If the state were to require everyone to have coverage and require insurance companies to cover anyone who signs up, that would include many low-
income Californians who don’t have insurance today. Those Californians can’t be expected to pay full freight. And they can’t be left out of the equation, only to wander later into emergency rooms and expect care.

In any sane health care system, getting pregnant should never be a cause to lose health care.

http://www.sacbee.com/110/story/143154.html

Comment:

By Don McCanne, MD

The Bee’s editorial board understands: “What is important is to throw everyone into the pool.”

Segregated pools of healthy individuals won’t do it. Yet that is the specialty of the private insurance industry – pooling risks of the healthy workforce and their healthy families.

If we are to effectively spread the risk, we would have to transfer funds from the segregated pools insuring the healthy, to pools that include those with high-cost needs. But that creates an actuarial nightmare that invites the inequities of gaming the system. It would be much easier and much more efficient to establish one single universal risk pool. It would also finally make the financing of health care equitable since contributions would be based on ability to pay.

Once we remove the requirement for the private plans to pool risk, what is left for them to do for us? Think hard. We’re sure paying them a lot for whatever it is they do.

Maybe it is time for us to tell those in the health insurance industry to go get a real job.

Gray Matters

Staying with Medicare will help keep it alive

By Saul Friedman
Family & Relationships
Newsday
March 24, 2007

Regular reader Martin Selig of Carle Place reminded me of a warning I had intended to convey about the problems with so-called Medicare Advantage plans.

The deadline for enrollment is March 31. He wondered whether an advertisement for one such plan – Liberty Advantage – isn’t intended to “lure people away from government controlled Medicare and put them in the hands of private HMOs.” The short answer, of course, is yes.

Beginning in 1997, the Congress pressured President Bill Clinton to further open Medicare to private plans, Medicare HMOs. Despite government subsidies, the HMOs abandoned the Medicare business and subscribers when they failed to make the profits they expected. But it was the opening wedge to Medicare privatization.

Then, under the Bush administrations, the HMOs got renewed life as “Medicare Plus” plans. With the passage of the privatized Part D drug plan, Republicans gave the insurance companies a huge “stabilization fund” to cushion them against possible losses and renamed the plans “Medicare Advantage.” And with the administration starving traditional Medicare, the Medicare Advantage plans are gaining subscribers because they seem to cost no more than Medicare but provide more coverage.

The Kaiser Family Foundation says there are 8.3 million subscribers to Medicare Advantage plans, up from 5.5 million since 2004. That’s because, in addition to the stabilization fund, they are further subsidized by the government, paid on average 12 percent more than the cost of traditional fee-for-service Medicare for each subscriber.

Thus, the first problem: Each new subscriber to a Medicare Advantage plan means another of the thousands of cuts that are bleeding Medicare to death, which explains why Medicare advocates in the Congress want to reduce the subsidy. You’d help by staying with Medicare.

Also, in addition to the advertising campaigns, the Medicare Rights Center and newspapers report that brokers and agents, some of them claiming to be from Medicare, are convincing beneficiaries to switch from traditional Medicare and sign up for Medicare Advantage plans. They claim, falsely, that beneficiaries may use doctors of their choice. Or they claim what they’re selling is “just like Original Medicare,” said the Medicare Rights Center.

It isn’t, of course, but the salespeople, who are paid commissions, pick on the more vulnerable elderly who live alone. No one from Medicare is authorized to call or visit you to sell you anything. People are being switched without fully understanding what is happening, and when you sign up for a Medicare Advantage plan, despite what you may be told, you must use doctors, labs and hospitals in the plan’s network. You’re no longer in traditional Medicare. And you may not be covered when you visit out of town. Also you’re locked into a Medicare Advantage plan for at least a year.

Third, although you may be told that you need pay only your monthly Part B premium ($93.50 for most people), the drug premiums and drug costs and co- pays for doctor and lab visits can add up.

And the Medicare Advantage premiums (in addition to the Part B premiums) vary wildly depending on where you live. Government subsidies differ from county to county.

For example, in New York, HIP and Empire Blue Cross offer Medicare Advantage plans in Nassau County for no premiums (in addition to the Part B premium) for the health or drug coverage, and they pay for generic drugs in the doughnut hole coverage gap. For comparable coverage in adjoining Suffolk County, HIP charges a $99 monthly premium (in addition to Part B) for the health care, $33.90 monthly for the drugs, with generic coverage in the hole; Empire charges a $116 monthly health premium plus $21.90 a month for drug coverage.

The Medicare Advantage HMOs remain notoriously slow in paying claims, refusing at first an average of 40 percent, according to New York Times columnist Paul Krugman, who reports that angry doctors and hospitals are hiring companies to challenge the insurers. Some insurers are “cherry pickers” seeking to cover the youngest and healthiest clients; others are “lemon droppers,” companies that refuse or drop coverage for the chronically ill.

Depending on your situation (if you travel or need certain doctors and hospitals), a better course is to have a trio of plans good anywhere in the U.S.: Traditional Medicare; a supplemental policy, such as Medigap, and a relatively inexpensive Part D drugs-only plan.

For help in deciding, call the health insurance counseling hotline, 800-701- 0501; Medicare Rights Center, medicare rights.org at 800-333-4114.

Here’s another piece of evidence that this administration is out to kill Medicare. Because the Congress imposed an arbitrary cap on Medicare – premiums must always pay for 15 percent of Medicare’s budget – the Part B premiums are expected to rise by a record 17 percent next year, from $93.50 to $109.40, according to the nonpartisan TREA Senior Citizens League.

For most beneficiaries, that means Medicare premiums next year will have increased 77 percent in six years, wiping out the Social Security cost-of- living increases of 15 percent for the same period. The league estimated that 22 million Social Security recipients will see no cost-of-living increase because of the greater deductions from their checks for Medicare.

More affluent beneficiaries will be socked with premiums approaching $200 a month. That’s certain to drive many people away from Medicare and leave it as a program for the low-income elderly. I believe that has been the administration’s plan.

WRITE TO Saul Friedman, Newsday, 235 Pinelawn Rd., Melville, NY, 11747-4250,

or by e-mail at saulfriedman@comcast.net. Copyright 2007 Newsday Inc.

Candidates Outline Ideas for Universal Health Care

By ROBERT PEAR
The New York Times
March 25, 2007

LAS VEGAS, March 24 — Seven Democratic candidates for president promised Saturday to guarantee health insurance for all, but they disagreed over how to pay for it and how fast it could be achieved.

Senator Hillary Rodham Clinton of New York assailed the health insurance industry and said she would prohibit insurers from denying coverage or charging much higher premiums to people with medical problems.

John Edwards, the former senator from North Carolina, offered the most detailed plan for universal coverage, saying he would raise taxes to help pay the cost, which he estimated at $90 billion to $120 billion a year.

Senator Barack Obama of Illinois appeared less conversant with the details of health policy and sometimes found himself on the defensive, trying to explain why he had yet to offer a detailed plan to cover all Americans.

“The most important challenge is to build a political consensus around the need to solve this problem,” Mr. Obama said.

Gov. Bill Richardson of New Mexico offered a potpourri of ideas to achieve universal coverage, including tax credits to help people buy insurance and an option to let people ages 55 to 64 buy coverage through Medicare.

To help pay for his proposals, Mr. Richardson said, he would “get out of Iraq” and redirect money from the military to health care.

The candidates spoke at a forum on health care at the University of Nevada, Las Vegas, sponsored by the Service Employees International Union and the Center for American Progress Action Fund, a liberal advocacy group. Sponsors of the forum said they had also invited Republican candidates, but none attended.

Health care is emerging as a top issue in the 2008 presidential race, as businesses join consumers in demanding action to curb costs and cover the uninsured.

Nevada has gained new prominence in the political calendar. It will provide an early test of voter sentiment in a Sunbelt state with a large Hispanic population, and the results here could help create momentum for a Democratic candidate going into New Hampshire. Nevada Democrats are scheduled to hold presidential caucuses on Jan. 19 next year, five days after the Iowa caucuses and three days before the first-in-the-nation primary in New Hampshire.

Mrs. Clinton said she hoped to make health care “the No. 1 voting issue in the 2008 election.”

Her remarks were reminiscent of a speech she gave to the service employees union in May 1993, when she attacked “price gouging, cost shifting and unconscionable profiteering” in health care and the insurance industry.

On Saturday, she said that the failure of her proposal for universal coverage in 1994 made her more determined to achieve the goal now.

“It also makes me understand what we are up against,” Mrs. Clinton said. “We have to modernize and reform the way we deliver health care. But we have to change the way we finance it. That’s going to mean taking money away from people who make out really well right now.”

Mrs. Clinton complained that “insurance companies make money by spending a lot of money, and employing a lot of people, to avoid insuring you, and then if you’re insured, they try to avoid paying for the health care you receive.”

To deal with such problems, Mrs. Clinton said, “we could require that every insurance company had to insure everybody, with no exclusion for pre-existing conditions.”

Mr. Edwards, who disclosed on Thursday that his wife’s cancer had returned in an incurable form, reaffirmed that he was “definitely in the race for the duration.”

He said that he and his wife, Elizabeth, were getting “too much credit” for their courage and determination. Millions of women have had to struggle with cancer “without what we have, without great health care coverage, without knowing they can get all the medications they need,” he said.

“One of the reasons that I want to be president of the United States,” Mr. Edwards said, “is to make sure that every woman and every person in America gets the same kind of things we have.”

Under the Edwards plan, employers would have to cover their employees or pay into a fund that would finance coverage. Senators Clinton and Obama also expressed interest in this idea.

Mr. Edwards said he would help pay for his plan by “rolling back George Bush’s tax cuts for people making more than $200,000 a year.”

Mr. Richardson said universal coverage “could be achieved in my first year as president,” if voters sent more Democrats to Congress.

As president, he said, he would duplicate the steps he has taken as governor, to “cut junk food out of schools” and to ban smoking in most workplaces, including bars, restaurants and stores.

Mr. Obama said that he would be issuing a detailed plan “over the next couple of months” to achieve universal coverage by the end of the first term of the next president, in January 2013.

When asked why he did not have such a plan, he said, “Our campaign now is a little over eight weeks old.”

While most people get coverage through employers, Mr. Obama said, he wants to foster federal and state purchasing pools. Employers would still have the option of providing coverage, he said, but after 10 or 20 years, “many people may find that they get better coverage,” or better value, outside their employers.

Mr. Obama said he did not know how much it would cost to achieve universal coverage. In response to a question, he said, “I have not foreclosed the possibility that we might need additional revenue” to reach that goal.

“We should not underestimate the amount of money that could be saved in the existing system,” Mr. Obama said. But he opposed cuts in payments to hospitals, doctors and nurses.

Another candidate, Senator Christopher J. Dodd of Connecticut, emphasized his experience, saying that as president he could immediately begin work with Senate committee chairmen to forge a consensus on legislation to cover all Americans.

Mr. Dodd said he would push for legislation making it easier for nurses to form unions, even if they performed some supervisory duties.

Among the candidates at the forum, Representative Dennis J. Kucinich of Ohio offered the most sweeping proposal, to create “a universal, single-payer not-for-profit health care system providing Medicare for all.”

“Health care is a right, not a privilege,” Mr. Kucinich said.

Another candidate, former Senator Mike Gravel of Alaska, called for “a universal single-payer plan.” He said he would give people vouchers, which could be used to pay doctors and hospitals, and a choice of five or six health plans.

(Note by PNHP – Gravel’s plan is not a single payer plan. It is a variant of “managed competition” as proposed by right-wing Stanford economist Victor Fuchs)

Blog postings from the Campaign for America's Future

SEIU Candidate Debate, Las Vegas, 3/24/07

Universal Care: Getting The Right Mix

Submitted by Roger Hickey on Mon, 2007-03-26 15:22.

At Saturday’s health care forum for presidential candidates, John Edwards was bold, detailed and specific–but didn’t diagnose the problem.

Barack Obama was vague–but stressed that no president can do it without the people.

Dennis Kucinich diagnosed the problem, and pushed immediate transformation.

Hillary Clinton, surprisingly, forcefully adopted Kucinich’s diagnosis (before he spoke).

Put them all together–in the right way–and you have a winning health care plan.

I was at the forum in Las Vegas where the Center for American Progress and SEIU made a real contribution to the political debate by getting seven Democratic candidates together to discuss health care.

In a political system where presidential candidates, not party committees, formulate policy for the parties, forcing the candidates to refine their views early–before a crowd of party and union activists–is not a bad thing. Irresponsibly, CSPAN didn’t cover it live, but CAP streamed the event live on the web, and will soon have a transcript available.

Everyone expected former senator Edwards to stress the specifics of his plan for health care for all, and he did. The audience was not so prepared for Obama’s vagueness, but the Illinois senator stuck to principles on the grounds that he was still working on his plan.

But the real surprise was Clinton’s forceful diagnosis of the health care problem–and of her failure to win coverage for all in her husband’s administration.

The New York senator pointed to the power and greed of the insurance industry. She told the Nevada crowd that the failure of her proposal for universal coverage in 1994 made her more determined to achieve the goal now.

As reported by Robert Pear in Sunday’s New York Times, Clinton declared, “[My experience] also makes me understand what we are up against. We have to modernize and reform the way we deliver health care. But we have to change the way we finance it. That’s going to mean taking money away from people who make out really well right now.”

Pressed to explain what she meant by moderator Karen Tumulty of Time, she complained that:

…Insurance companies make money by spending a lot of money, and employing a lot of people, to avoid insuring you, and then if you’re insured, they try to avoid paying for the health care you receive.

(Monday’s front-page story in The New York Times offers a particularly vivid example of that in the long-term care industry.)

With that, Clinton established a strong starting point for an explanation that most Americans can understand about why health care is in crisis. She also announced she would soon introduce legislation to “require that every insurance company had to insure everybody, with no exclusion for pre-existing conditions.”

And with that, Hillary left open the question each of the major candidates need to answer: If the insurance industry is the problem, do we want them to be the centerpiece of an expanded system of subsidies and regulations to try to “incentivize” or force them to cover everyone? And if we go down that road, will we ever get health care costs under control?

Even Edwards, with his admirably frank and detailed plan, does not really answer that question. He builds his coverage-for-all plan around both private insurers and a public, Medicare-like system, claiming that the public’s choices could eventually lead to the private companies losing the competition.

Kucinich was very clear in his response: Even if you set up a public program to compete with private insurers–and even if you regulate the private insurers (as Clinton and Schwarzenegger want to do)–the private insurance companies will find ways to “cherry pick” and cover only the youngest, healthiest and richest parts of the population. And, the representative from Ohio warned, you will end up with only the oldest, sickest and poorest people in the public system–and that is not level competition.

Kucinich’s other warning: Private insurance, with its advertising and administrative costs (necessary to do their “cherry picking” and claims-denying) can never be the basis for an efficient health care system that can get overall costs stabilized.

Kucinich’s problem is the public’s resistance to rapidly imposing his “single-payer” system on everyone–even those (represented memorably by Harry and Louise) who are happy with their current health plan and don’t want to change.

But Clinton’s diagnosis of the health care problem could lead her (or Obama or Edwards) to embracing a gradual shift to a Medicare-style public plan for everyone (individuals and corporations) for whom private insurance is not working.

There was a lot of agreement on important fundamentals at the debate: Edwards, Clinton and Obama all agreed that requiring employers to either insure their workers or pay into a fund to cover them (“pay or play”) is probably the way to go.

So if you put them all together in the right way, you just might come up with a winning health care plan, a winner for the candidate and for the American people.

P.S. — I’m glad I went out to Las Vegas rather than trying to get the streaming video to work. Being there made me realize how for the Democratic Party this health care vision is very much a work in progress. People need to understand that we have the power–though our tough questions, through the lines we chose to applaud and through our own strong advocacy of what kind of health program the candidates should adopt. We have the power to shape the program and the message, and the winning strategy.

P.P.S — I told the taxi driver who took me to the Cox Center at the University of Nevada at Las Vegas about the debate about to take place inside. He hadn’t heard about it but thought a health care solution was really needed. Hospitalized with a serious illness–and no health insurance–he ended up with $250,000 in medical debts and had to declare bankruptcy.

After he got well, he tried to get a job (one with health insurance) at one of the big unionized hotels on the Vegas strip, but the hotel turned him down for the job because his credit records indicated he had declared bankruptcy!

This kind of Catch-22 health care system is undermining everyone’s economic security and Americans are looking to us for an alternative.

The Health Care Questions I Still Have

Submitted by Bill Scher on Mon, 2007-03-26 18:05.

After watching Saturday’s presidential candidate forum on health care, and judging the candidates using Roger Hickey’s five health care questions, I’m left with key questions for each Oval Office aspirant.

To former Sen. John Edwards: your plan sets up competition between private insurers and a new “Medicare-style” government plans for everyone under 65. You argue that with competition, we will see if Americans want public or private plans. But what will you do to ensure the plans compete on a level playing field?

To Sen. Hillary Clinton: You accurately identified the problem with private insurers, how they make a profit by either trying to “avoid insuring you” or “try[ing] to avoid paying for the health care you receive.” But the 1993 health care plan you supported solely relied on private insurers to deliver health care coverage. Will you commit to offering some sort of public plan so we can reduce our reliance on private insurers?

To Sen. Barack Obama: The principles you laid out appear to track the plan that John Edwards has offered. In fact, you called Edwards’ plan “very credible.” What can you propose that would improve upon the Edwards plan?

To Gov. Bill Richardson and Sen. Chris Dodd: Are you actually pledging to achieve universal coverage, or are you only offering universal “access” to coverage, which will allow some to fall through the cracks?

To Rep. Dennis Kucinich: You make a compelling case for an immediate move to a single-payer system, but how do you convince those Americans who are content with their coverage that such a system won’t take away what they have?

To Sen. Joe Biden: The Nevada Caucus 2008 blog checks your past statements and concludes you chose not the attend the forum because you’re not really for universal coverage. Is that true?

To the Republican candidates, who all skipped the forum: Do you really think you can win the White House if you won’t take public questions on what you’re going to do about our health care crisis?