PNHP

A private health care information technology system

A private health care information technology system

A private health care information technology system

Health and Human Services
July 21, 2004
The Decade of Health Information Technology: Delivering Consumer-centric and Information-rich Health Care
By David J. Brailer, MD, PhD, National Coordinator for Health Information Technology

Conclusion

Health information technology provides a mechanism for refocusing care delivery around consumers without substantial regulation and industry upheaval. Information technology can result in better care (care that is higher in quality, safer, and more consumer responsive) and at the same time, more efficient (care that is appropriate, available, and less wasteful). There are very few other alternatives that can achieve both of these goals in a balanced and timely manner.

A national strategy for HIT is needed to achieve this change. This strategy should inform clinical care by introducing EHRs on a widespread basis everywhere clinicians provide treatment. It should interconnect clinicians to allow them to share data in a seamless and secure manner that protects patient privacy. It should customize health information and care so that consumers can have more control, more treatment options, and more choice of providers, including clinicians who may be at a distance. It also should improve population health by monitoring health care delivery in a simple and timely fashion so that quality, public health risks, and clinical research can be enhanced.

The changes that will accompany the application of information technology to health care will be difficult and will challenge fundamental assumptions that have been long held. However, this change is inevitable, needed, and beneficial. Actions can and should be taken to ensure that this change happens sooner rather than later, is more widespread rather than less, and also improves health care quality while addressing health care costs. The actions that are taken over the next decade will ensure that the best health care can be delivered to Americans, and that lasting and positive change in the health care industry will result.

And from the report:

Public-Private Leadership

Low adoption and use of HIT are attributable to many factors, including a
challenging marketplace and a previous lack of cohesive federal policies supporting it. Leaders across the public and private sector recognize that the adoption and effective use of HIT require a joint effort between federal, state, and local government and the private sector.

The private sector role

While the federal government plays an important role in HIT adoption, the effective use of, and value creation from, this technology lies predominantly with the private sector. The federal government will provide a vision and a strategic direction for a national interoperable health care system, but will rely on a competitive technology industry, privately operated support services, and shared investments in HIT adoption. The private sector must develop the market institutions to deliver the products and services that can transform the paper-based health care system into an electronic, consumer-centered, and quality-based system. The private sector can best ensure that HIT products are successfully implemented in ways that meet the varying needs of American health care across settings, cultures, and geographies. The private sector can also continue constant innovation in HIT and ensure that products are delivered on an affordable basis.

Federal and state governments have delegated most components of quality assurance to voluntary private organizations, including but not limited, to the JCAHO, NCQA, the National Quality Forum, residency review committees, and others. This will be true of quality and performance accountability in the future world of HIT. New market institutions need to be developed that can support clinician adoption of HIT, provide interoperability, and enhance the value realized by these investments. Close collaboration between public and private sectors can develop new methods for improving care without creating unnecessary regulation and minimizing reporting burdens on private industry.

The federal role

The federal government has substantial cause for addressing HIT adoption. Although the public is only now becoming aware of errors and mistreatments
in care delivery, the incidence and severity of errors has been known by researchers for some time. The health status of Americans is lower than it
would be if care were seamless, timely, and evidence driven. Health care
inefficiency and quality problems create economic burdens on other industries. When working Americans spend large shares of their time moving between physicians, dealing with the morbidity of improperly treated chronic illness, handling care burdens for their elderly parents, and recovering from errors and unnecessary therapies, the productivity of the American labor force, and America’s position as a global output leader, is harmed.

The federal government has numerous means of stimulating change in the health care industry, even if most of that change occurs in the private sector. While the federal government should not seek to reform health care without industry collaboration through the use of information technology, neither should it let the status quo exist simply because change will be difficult, complicated, and challenging to the industry. The DoD and VA are major federal health care delivery organizations and, increasingly, contractors for care in communities across the United States. The lessons these organizations have learned about HIT are an invaluable national asset and should be diffused through relationships with private delivery networks. Also, the Federal Employees Health Benefits Program (FEHB) contracts for care in most urban markets across the United States, and can drive positive economic change in general care delivery. Beyond finance and
contracting, the current operation of the health care industry results from a vast
patchwork of federal regulations that create many unintended inhibitory consequences for quality and efficiency.

The full report (178 pages):
http://www.hhs.gov/onchit/framework/hitframework.pdf

Press release:
http://www.hhs.gov/news/press/2004pres/20040721a.html

Comment: The private, competitive market has produced for us computers that are powerful yet inexpensive. Software that is used widely is quite inexpensive, and that in the public domain is essentially free after the initial development costs. With inexpensive computers and software developed in the public domain, the cost of an integrated health care IT (information technology) system should be quite modest. And the return in error reduction and administrative efficiency would far more than offset any real costs.

The Veterans Administration is far ahead of the rest of the nation in developing and utilizing an integrated IT system. And this has been developed in the public (government!) sector. Many other nations with universal health care systems have also introduced integrated IT systems primarily through the public sector.

What has the magic of the competitive marketplace produced in the way of an
integrated IT system to this date? High costs, very poor penetration, and system failures! Competitive market theory dictates that we should be leading the world with a high quality health care IT system at a low cost. What went wrong?

First of all, a fragmented system of multiple private plans, public programs and uninsurance does not provide an infrastructure that is very conducive to an integrated IT system. A single payer system, or, at minimum, a highly regulated system of universal coverage through multiple plans, would provide a framework that would ensure adaptability of an integrated IT system. Of course, a single, publicly administered system would be much preferred for an integrated IT system.

But the greatest difficulty with private IT solutions lies in the very nature of these marketplace models. Their goals are, above all, to maximize profits and to maximize the market price of their shares. To achieve those goals, corporate behavior varies from that of a public entity that has a simpler goal of establishing an effective and efficient high quality system that serves the heath care system and its patients well. The public system does not have to be concerned about being a successful business enterprise, but the private model does.

What might the private sector do that doesn’t serve our interests well? They will produce products that command the highest prices that the market will bear. They will design the products to provide a continuing revenue stream. Once gaining a significant share of the market, they will design incompatibility with other systems in an attempt to garner the entire market. They will design obsolescence into their systems to ensure future markets for their new innovative products. They will partner with and perhaps acquire other related entities that can expand profit potentials through greater control of components of the health care system which their products can influence. Although these are good business practices, they are terrible policies for our health care system.

But without market incentives, wouldn’t innovation be suppressed? We have market innovations now, and they have not resulted in the IT developments
that we desperately need. Public innovations have been effective in developing systems in other nations and in the VA that are already working. If private entrepreneurs can develop innovations that could benefit a public system, there is no reason that they couldn’t be sold to the government to place in the public domain. But they should be priced to reflect costs plus a fair one-time profit. We really don’t need more superfluous profit centers in our health care system.

The health information technology report released today should alarm us all.
Although we all agree on the importance of an integrated IT system, the Bush
administration is limiting the role of the government to being an enabler that encourages the private sector to develop a successful business model. Rather than higher quality at a lower cost, we’ll end up with mediocrity at a much higher cost, wasting even more of our health care dollars.

We desperately need strong leadership from our government in developing a
health care IT system that will serve us all well. But based on the current leadership that has failed to address even the fundamental issue of adequate
health care coverage for all, it is unlikely that we’ll see any enlightened leadership on this in the near future. But that said, “Watch this swing!”

NCHC’s call for comprehensive reform

NCHC’s call for comprehensive reform

National Coalition on Health Care
July 20, 2004

Building a Better Health Care System

Principle 1 – Health Care Coverage for All

Principle 2 – Cost Management

Principle 3 – Improvement of Health Care Quality and Safety

Principle 4 – Equitable Financing

Principle 5 – Simplified Administration

Conclusion

The members of the National Coalition on Health Care are determined to work
for comprehensive reform of the American health care system. We offer these
specifications for reform as an agenda – an urgent agenda – for action. We close with two observations.

First, we would emphasize again our conviction that reform must be systemic
and system-wide. The problems of our health care system – and the principles
that guided our development of specifications for reform – are so closely
interrelated that they must all be addressed at the same time. One-dimensional reform will not work.

Consider: Unless we improve the quality of care, we will not be able to manage costs or afford universal coverage. Unless we manage costs effectively, we will not be able to achieve equitable financing or cover all Americans. And unless we assure coverage for everybody, we will be unable to make the system less complex, establish a level playing field without cost-shifting, or create a truly competitive health care marketplace.

Second, the status quo – clearly, undeniably – is not working. It leaves tens of millions of Americans with no health insurance at all. It allows costs to skyrocket year after year, putting coverage out of reach for millions of Americans and compromising the vitality of our economy and its capacity to create and sustain jobs. And it jeopardizes the safety of patients because of widespread sub- standard care.

The status quo is not acceptable. It is time – it is past time – to change it. The readers of this report can have a tremendous impact on the prospects for reform and the shape of reform. We hope that you will work with us in this important effort.

Full report:
http://www.nchc.org/materials/studies/reform.pdf

Press release:
http://www.nchc.org/news/press_releases/2004_07_20.pdf

Webcast of the briefing:

http://www.kaisernetwork.org/health_cast/hcast_index.cfm?display=detail&hc=1239.

Comment: On reading the full report it is difficult to come to any other conclusion than that a single payer, publicly funded and publicly administered insurance program offers the best option, and possibly the only realistic option, for achieving all of the Coalition’s goals. However, in order not to lose support of several coalition members, the other familiar options were included for consideration in this proposal.

Although this report is quite weak on specifying the one precise model of reform that should be adopted, it is very strong in supporting no less than truly comprehensive reform now. The message is that it is time to abandon the failed policies of incremental tweaking. That is a real step forward. We should move on it.

WebMD calls for a government solution for electronic communications

WebMD
July 19, 2004
HIPAA Implementation: The Case for a Rational Roll-Out Plan

HIPAA Administrative Simplification, as it is currently being implemented,is increasing complexity and cost for health care providers and payers.

Introducing WebMD

WebMD Envoy conducts more HIPAA transactions than any other private entity. In total, WebMD processes more than 3.0 billion transactions on an annualized basis for 300,000 physicians, hospitals, dentists, labs and pharmacies, submitting to more than 1,500 payer connections.

The HIPAA Promise: Administrative Simplification

As envisioned by Congress, codified by law and embraced by the industry, HIPAA Administrative Simplification would reduce administrative costs by increasing efficiency through the exchange of electronic communications between providers and payers. As HHS noted in the preamble to the final Transaction Rule, “The lack of standardization makes it difficult and expensive to develop and maintain software. Moreover, the lack of standardization minimizes the ability of health care providers and health plans to achieve efficiency and savings.” At the core of the HIPAA promise is the commitment to reduce administrative costs by defining standards for electronic transactions so that all participants in the electronic health care marketplace would speak the same language and use the same practices.

Instead of negotiating the details of more than 400 claim forms,providers would fill out just one form that would be accepted by all payers. The information payers sent back to providers would be equally uniform. The simplicity brought about by standardization was expected to encourage more providers to switch from paper to electronic transactions.

The HIPAA statute specifies that the standards adopted “shall be consistent with the objective of reducing the administrative costs of providing and paying for health care.” Congress reiterated this objective in the statute three times, and the Department clearly stated that “[t]he purpose of [the Transaction Rule] is to improve the . efficiency and effectiveness of the health care system.” Consistent with Congress’s clear intent that Administrative Simplification reduce administrative costs, standard electronic health care communication must be implemented in a manner that is consistent with and satisfies this objective.

Missing the HIPAA Mark

The simplification envisioned by HIPAA has not materialized and the statutory HIPAA goals of reducing administrative costs and increasing efficiency are in jeopardy.

Transaction Format – Lack of Uniformity

The standards and implementation specifications are extremely complicated and thousands of pages long. Multiple versions of a HIPAA standard claim have emerged as each payer defines for itself what constitutes a “HIPAA-compliant” claim. Payers have published more than 600 different “companion documents” setting forth their individual interpretations and implementation of the government guidelines. That number is expected to grow to one thousand. The standards, as currently being implemented, are increasing the complexity, and therefore the costs of electronic transactions.

Getting HIPAA back on Track: HHS Leadership

HHS must take action to facilitate the successful implementation of Administrative Simplification. Industry efforts to implement Administrative Simplification have resulted in complex standards, expensive and inefficient implementation and uncertainty in the market place. A few strategic actions by the Department can leverage the remarkable forces and resources of the health care industry to achieve the objectives of Administrative Simplification.

Implement full complement of HIPAA transactions

It is widely recognized in the industry that only through implementation of all the covered transactions will administrative efficiencies, and therefore savings, be realized. CMS has an important leadership role to play in making this HIPAA objective a reality. We recommend that, as a payer, CMS focus its implementation efforts on the complete set of HIPAA transactions. To these ends, the Medicare contingency plan should address the full set of transactions, not simply HIPAA formatted claims. Other payers will follow Medicare’s example and diversify efforts to ensure a balanced implementation initiative that recognizes HIPAA is more than just submitting claims.

Conclusion

CMS action is vital to ensuring that the HIPAA objectives of cost savings and increased efficiency are achieved. The success or failure of HIPAA implementation will have significant implications for the success or failure of the National Health Information Infrastructure.

http://www.corporate-ir.net/media_files/IROL/11/116708/HIPAApaper1.pdf

Comment: Imagine if we had a single, publicly administered payer instead. The conclusion that we need a government agency to take action to implement the National Health Information Infrastructure would be the same. But the administrative nightmare of attempting to bring into efficient compliance our fragmented system of funding care would be nothing more than a bad dream.

Nation’s Largest Health Coalition Calls For Sweeping Changes in Health Care System

For More Information, Contact:
Janet Firshein or Kari Root at (301) 652-1558, or
Pat Schoeni at NCHC, (202) 638-7151

Nation’s Largest Health Coalition Calls For Sweeping Changes in Health Care System

Washington, D.C., July 20, 2004: Alarmed at what it terms a deepening health care crisis and dissatisfied with the status quo, the nation’s largest, most broadly representative alliance of organizations working for health care reform today called on our nations policymakers to dramatically overhaul the health care system.

The National Coalition on Health Care, which includes nearly 100 of Americas largest businesses, unions, provider groups, insurers, pension funds, and consumer and religious organizations, urged comprehensive reforms that would insure all Americans, control rapidly rising health costs, and dramatically improve quality and patient safety.

Henry E. Simmons, M.D., president of the non-partisan Coalition said, The health care reforms we are recommending go far beyond any proposal now being considered. After a year of study and debate, the Coalition has concluded that incremental strategies will not be sufficient. What we need is action on comprehensive reform, and soon. And it is clear that over the long term, the cost of action is far less than the cost of inaction, he added.

The Coalition, which collectively represents 150 million Americans, today released specifications for system-wide reforms to help frame a renewed national debate about the health care system and to embolden political leaders to act rapidly regardless of who is elected President or wins control of Congress in November. The Coalitionís report, Building a Better Health Care System: Specifications for Reform, calls for:

1.Requiring health coverage for all Americans within two to three years after the enactment of legislation.
2.Bringing cost increases for health care in line with increases in other parts of the economy within five years.
3.Launching a nationwide effort to dramatically improve the quality, safety, and value of care.
4.Making the financing of health care more equitable.
5.Simplifying and modernizing the administration of health care.

At a press conference on Capitol Hill today, the Coalition warned that, if policymakers fail to act:

ï Premiums for family health coverage will exceed $14,500 in 2006 — more than double their level in 2001.
ï The number of Americans without health insurance will surge to more than 51 million in 2006 — an increase of more than 10 million since 2001.
ï Millions will be unnecessarily injured, and hundreds of thousands of Americans will die each year because of poor quality care.
ï Surging health care costs will add trillions of dollars to federal deficits in the coming decades.

According to the Coalition, The escalation of health care costs is not only a health care issue. It is also a major national economic problem.î Soaring health care costs, the new report says, are reducing economic growth and job creation, corporate profits, the global competitiveness of American firms, and the viability of pensions. Health care costs also have become the single most contentious issue in collective bargaining.

These and other pressures have pushed this unusual alliance of organizations to reach consensus and compromise to make progress, said former Governor Robert D. Ray (R-IA), Co-chairman of the Coalition. “If each of us — each political leader, each organization, each voter — holds out only for our ideal, we’ll remain deadlocked, he warned.

The status quo is unacceptable, added Coalition Co-Chairman Paul G. Rogers (D-FL), former U.S. Representative and Chair of the House Energy and Commerce Health Subcommittee. Todays report is politically significant because it shows that there is broad support across most sectors of the economy and society, and across party lines for tough, system-wide reform. The Coalition’s Honorary Co-Chairmen are former Presidents George H.W. Bush, Jimmy Carter, and Gerald R. Ford.

Speakers at today’s press event included:

Henry E. Simmons, M.D., President, National Coalition on Health Care
Former Gov. Robert D. Ray, Co-Chairman, NCHC
Former U.S. Rep. Paul G. Rogers, Co-Chairman, NCHC
John Aschenbrenner, President, Insurance and Financial Services, Principal Financial Group
John J. Sweeney, President, AFL-CIO
William Novelli, CEO, AARP
James Winkler, General Secretary of the General Board of Church and Society of the United Methodist Church, for the National Council of Churches of Christ in the U.S.A.
Barbara Ross-Lee, D.O., Chair of the Board of Directors, Association of Academic Health Centers
William J. Grize, President and CEO, Ahold USA
Sean Harrigan, President of the Board, California Public Employees Retirement System

A list of the Coalition members issuing today’s report is attached to this press release. Additional information about the Coalition and a copy of the report Building a Better Health Care System: Specifications for Reform, can be obtained by visiting the Coalition’s Website (www.nchc.org) or by calling (202) 638-7151.

The Georgia SecureCare Program

The SecureCare Program would cover all Georgians under a single uniform health plan that is administered and funded by the state. The SecureCare program would replace all current public-sector insurance systems including:
Medicare, Medicaid, PeachCare, CHAMPUS and the Federal Employees Health Benefits Plan (FEHBP). It would also replace private health insurance plans in the state. The program would be financed with current government health care funding for discontinued programs, a payroll tax to replace employer benefits plans and other dedicated revenues (i.e., taxes) on households.

Please click here to read the Lewin Group Analysis

Medical Class Warfare

Medical Class Warfare

By PAUL KRUGMAN.
E-mail: krugman@nytimes.com

If past patterns are any guide, about one in three Americans will go without health insurance for some part of the next two years. They won’t, for the most part, be the persistently poor, who are usually covered by Medicaid. They will be members of working families with breadwinners who have jobs without medical benefits or who have been laid off.

Many Americans fear the loss of health insurance. Last week I described John Kerry’s health plan. What’s the Bush administration’s plan?

First, it offers a tax credit for low- and middle-income families who don’t have health coverage through employers. That credit helps them purchase health insurance. The credit would be $3,000 for a family of four with an income of $25,000; for an income of $40,000, it would fall to $1,714. Last year the average premium for families of four covered by employers was more than $9,000.

A study by the Kaiser Family Foundation estimates that the tax credit would reduce the number of uninsured, 44 million people in 2002, by 1.8 million. So it wouldn’t help a great majority of families unable to afford insurance. For comparison, an independent assessment of the Kerry plan by Kenneth Thorpe of Emory University says that it would reduce the number of uninsured by 26.7 million.

The other main component of the Bush plan involves ”health savings accounts.” The prescription drug bill the Bush administration pushed through Congress last year had a number of provisions unrelated to Medicare. One of them allowed people who purchase insurance policies with high deductibles, generally at least $2,000 per family, to shelter income from taxes by setting up special accounts for medical expenses. This year, the administration proposed making the premiums linked to these accounts fully tax-deductible.

Although the 2005 budget presents that new deduction under the heading ”Helping the uninsured,” health savings accounts don’t seem to have much to do with the needs of the families likely to find themselves without health insurance. For one thing, such families need more protection than a plan with a $2,000 deductible provides. Furthermore, the tax advantages of health savings accounts would be small for those families most at risk of losing health insurance, who are overwhelmingly in low tax brackets.

But for people whose income puts them in high tax brackets, these accounts are a very good deal; making the premiums deductible turns them into a great deal. In other words, health savings accounts will offer the already affluent, who don’t have problems getting health insurance, yet another tax shelter. Meanwhile, health savings accounts, in the view of many experts, will actually increase the number of uninsured.

This perverse effect shouldn’t be too surprising: unless they are carefully designed, medical policies often have side consequences that worsen the problems they supposedly address. For example, the Congressional Budget Office estimates that one-third of the retirees who now have drug coverage through their former employers will lose that coverage as a result of the Bush prescription drug bill and will be forced to accept inferior coverage from Medicare.

In the case of health savings accounts, the key side consequence is a reduced incentive for companies to insure their workers. When companies provide group health insurance, healthier employees implicitly subsidize their sicker colleagues. They’re willing to do this largely because the employer’s contributions to health insurance are a tax-free form of compensation, but only if the same plan is offered to all employees.

Tax-free health savings accounts and premiums would provide healthier and wealthier employees an incentive to opt out, accepting higher paychecks instead, and would lead to higher insurance premiums for those who remain in traditional plans. This would cause some companies to stop providing health insurance, or raise employee contributions to a level some workers can’t afford.

The difference couldn’t be starker. Mr. Kerry offers a health care plan that would extend coverage to most of those now uninsured, paid for by rolling back tax cuts for those with incomes over $200,000. President Bush offers a tax credit that would extend coverage to fewer than 5 percent of the uninsured, plus a new tax break for the affluent that would actually increase the number of uninsured. As I said last week, I don’t see how Mr. Bush can win this debate.

Coalition for Health Coverage forms in Southhampton

The Southhampton Press
June 24, 2004

By Kathleen Fitzpatrick

Members of the newly formed Coalition for Health Coverage in Suffolk held a vigil outside Southampton Hospital’s emergency room on Saturday in solidarity with thousands of protesters across the country who called attention to the millions of Americans who don’t have health insurance.

“This is a story that is playing out all over the U.S.,” said Kathleen Madigan, the eastern Long Island outreach coordinator for the Women’s Health Partnership, referring to the national day of action calling for government action. “There are people out here on the East End who are working three jobs and can’t afford health insurance.”

East End activist Michael O’Neill of the Unitarian Universalist Church said he’s 68 years old and can’t afford health insurance or dental care. “I have to hope I don’t get sick,” he said. “Medicine should not be a privilege.”

According to Families USA, a non-profit organization dedicated to achieving health care for all Americans, more than 75 percent of uninsured New Yorkers are members of working families. The remaining New Yorkers are either seeking employment or are not in the labor force because they are chronically ill, disabled or caregivers.

The coalition of South Fork organizations, which formed two months ago, is “pulling together to ring the bell” on the health insurance emergency in this community, said Ms. Madigan.

James S. Henry, author and investigative journalist, served as spokesperson for the coalition. “This group is coming together to start organizing on issues of concern to people who are not insured, but also to hospitals facing financial crisis in treating those who are uninsured, and the rest of us living in a population where doctors are not doing preventative care,” he said. “Seventy-two million Americans experienced a lack of coverage within the last two years. We’re making an effort to educate people to build support for specific policy changes at all levels.”

A bill championed by many at the vigil, the National Health Care Act, also referred to as Expanded Medicare for All Americans, has 30 sponsors in Congress. Dr. Elaine Fox of Physicians for National Healthcare who had a practice for 17 years in Southampton, has taken time off to be an activist, and supports the bill. She explained that the act would cover everyone under the “old-fashioned” Medicare.

“Medical administration costs would be 3 percent; right now, it’s at 10.25 percent with all other insurance plans,” she said. “The country would save $280 billion a year. That money is enough to cover all of the uninsured, to cover prescription drugs, and also cover those who are underinsured.”

Dr. Fox said that this bill would not cause an increase in health care spending. “Bush’s bill increases spending by $550 billion,” she said. “The reason that [this bill] has not passed yet is because of profits. Profit motive has no place in health care. Patients come before profits.”

The current system is profit-driven, not patient-driven, according to Mr. Henry. He said that such a system doesn’t work.

“Employer-based health care system is not doing the job,” he said. “Costs have risen 10 percent a year for the last decade. As a country, a larger share of our national income is going to pay health insurance, more than in any other country. Fifteen percent of our [Gross Domestic Product] goes toward health insurance. In European countries and in Canada they pay less than half of that.”

Mr. Henry explained that one of the problems with the medical market is that it’s not competitive. “It’s not the kind of market you expect to work well without regulation,” he said. “Consumers don’t know enough to evaluate their own care. Suppliers don’t have to compete. The people paying the bills—insurance companies—are not the ones receiving the care.”

“Those of us in this coalition believe health care should be viewed as a human right,” said Mr. Henry. “A lot of Americans wake up every day with this on their mind. People are losing their businesses. Small businesses are having a hard time competing. Hospitals like this one are in trouble.”

According to Donna Sutton, Southampton Hospital’s director of public affairs, in 2003 the hospital reported $1.3 million in “charity care,” free care provided to patients who are not expected to pay medical bills. In Suffolk and Nassau counties, there is a law that requires hospital to have a “charity care” program.

At Southampton Hospital, the amount of aid provided is based on need, which is determined by income and family size. The highest eligible income is twice the federal poverty level. The hospital actively screens those who could benefit from charity care, she said.

The hospital also reported $6 million in uncompensated care—expenditures not collected due to insurance companies not covering the bills and/or patients who the hospital expected would pay but who didn’t. The hospital’s total revenue for 2003 was about $80.7 million.

Dr. Allen Fein, who has a practice in Southampton, emphasized that the coalition was not attacking the hospital. “Hospitals are caught in a system where they aren’t being paid for the care they provide,” he said. “There’s very little good will between hospitals and insurance companies.”

Dr. Fox said that a disproportionate number of people of color are without health insurance. According to the coalition’s press release, 32 percent of Hispanics living in the United States are uninsured; 10 of the 13 million uninsured Hispanics are in working families. Twenty percent of black Americans and 18 percent of Asians are uninsured, compared with 11 percent of whites.

Most immigrants on the East End do not have health insurance—an issue the coalition will work on.

“If our goal is to provide care for everyone, and we want to include the immigrant community as well,” said Mr. O’Neill. “It is an injustice that they pay social security taxes and they’re not eligible to receive that money if they return to their home country.”

Ms. Madigan said the group would begin to meet regularly. “The next steps are for us to have an organizing meeting to formulate positions on this,” she said.

Currently the group is working on filming a documentary, “On the Edge: Living Without Health Insurance,” which highlights health insurance issues on the East End. The group hopes to have it finished by the fall, she said.

Medicare cards little help

Medicare cards little help
Dawn MacKeen
STAFF WRITER
July 15, 2004
Seniors in Nassau County can save more money purchasing top-selling medications through Canada and the Veterans Administration than with a new Medicare-approved drug card, according to a Congressional committee report issued Wednesday.

Democrats in the House Committee on Government Reform analyzed discounts offered by the 34 different cards in Nassau County. They found, for example, that seniors can get their prescriptions filled for almost the same price online at the Web site drugstore.com. “I think seniors should care because the federal government will be spending more than $500 billion to give them a prescription drug card that is not working,” said U.S. Rep. Carolyn McCarthy, who represents Nassau County and requested the study.

Seniors were able to start using the cards, which offer discounts of up to 18 percent on brand-name drugs, on June 1. Although there are no local numbers, the federal agency overseeing the program, the Centers for Medicare & Medicaid Services boasts 3.8 million enrollees nationwide, most of whom were signed up automatically.

Peter Ashkenaz, the agency’s spokesman, defended the program. “The cards are showing real savings,” he said, pointing out that the new report primarily compared the program to mail-order pharmacies, such as drugstore.com or ones in Canada. “And remember that most seniors prefer to buy their drugs at their neighborhood drug store.”

To many senior advocates, the results of the congressional study were hardly surprising. The recent findings mirror other studies examining the savings offered by the cards nationwide. The congressional study found that in Canada, a 30-day supply of Celebrex, an arthritis drug, costs $38.69 compared with the Medicare drug card’s $74.14. And through the Veterans Administration, for example, the acid reflux medication Protonix costs $44.31, in contrast to the card’s $68.71.
The new report says the only people who can benefit from the cards are low-income seniors, who don’t have to pay the annual fee of up to $30 for the card. Once a person enrolls, he or she can obtain a $600 credit to apply toward the purchase of prescription drugs. But to qualify for the subsidy, a person must earn less than $12,569 and a couple less than $16,862.

“The low-income are getting the benefit of the $600, but that’s really a small percentage,” said Roberta Monat, director of Long Island’s Jewish Association for Services for the Aged. “Most of our people have not even gotten them [the cards]… It’s much too confusing, convoluted, seniors can’t figure it out.”

In fact, more than 100,000 low-income seniors already in Elderly Pharmaceutical Insurance Coverage (EPIC) were automatically enrolled in First Health Services Corp.’s Medicare card program. That card saves the user less than any other, according to the report. “Our EPIC program receives drug manufacturer discounts on prescriptions, and the federal drug discount program is bringing additional cost savings,” said Rob Kenny, a state health department spokesman. But consumer advocates point out that the cards that offer the least savings can deplete a senior’s $600 subsidy faster.

“The Pataki administration should ask some very hard questions as to why the card it selected offers the worst deal,” said Robert Hayes, president of the Medicare Rights Center, a Manhattan-based consumer group.

Jim Sykes Announces Health Plan

Jim Sykes Announces Health Plan
By bshepard@ktva.com!
Brett Shepard
Tuesday, July 13, 2004 – US Senate candidate Jim Sykes has ambitious plans for Alaska’s health care system if he gets elected.

According to Sykes contributions from medical and insurance companies have dictated the health care platforms for his fellow competitors Tony Knowles and Lisa Murkowski.

He says we need to get the health care money out of the campaign system in order to make progress towards lower cost in the system.

Sykes solution for lower health care cost would be to create a single-payer national health care system.

“We need a single-payer system. Imagine a country, our country I hope, where you can take your health care card, like they do in Canada, and you see the physician y! ou want to see and you get the help you need and it’s payed for by a universal insurance pool. That is what we need.”

Sykes said this system would help control the continually rising cost of health care in this country.

We contacted representatives with the Murkowski campaign and they said this type of system wouldn’t work in the US.

The Knowles campaign representative said one the key components of Knowles campaign to help lower health care cost would be to import drugs from Canada.

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The New Economics of Being Young

The New Economics of Being Young
by Solana Pyne
One Sick Fall
With health insurance out of reach, a generation braces itself for the worst
July 13th, 2004

If they’re not outright poor as a class, young adults in this country are at least very, very broke. The average collegian graduates with more than $20,000 in debt, headed for a job market where real hourly wages have kept pace with neither inflation nor the cost of living. Young adults are broke in part because of their unprecedented schooling”in the latest census figures, 28 percent of those between 25 and 29 reported holding a bachelor’s degree”which promised to pluck them away from the constellation of problems plaguing America’s underclass, whether it was trouble with housing or inadequate medical care.
Yet there they are, these latest inheritors of the American dream, lined up in emergency rooms for toothaches and the flu, not because they’re having emergencies, but because they don’t have health insurance, and emergency rooms, unlike private doctors, are obliged to give them care. Since 1987, the number of uninsured young adults has grown at twice the rate of older adults, even though the demographic itself is shrinking. One-quarter to one-third of adults under 35 went without insurance for all of 2002, the most recent year for which statistics are available”an increase of 1.2 million from the year before. Half were uninsured for some part of 2002. Of the 43.6 million uninsured adults in the U.S., 41 percent are young.

Of all the rationales John Kerry and George Bush will give this year as they stump for their individual visions of helping the nation’s uninsured, one of the most pragmatic is that those little plastic cards can make the difference, for a crucial group of consumers, between having a financial parachute and cratering into debt.

Maria Davidson, of Meriden, Connecticut, was 26 and working for low pay with no benefits when her seven-year-old son tried to kill himself. The ambulance took him to Yale-New Haven Hospital. She had no private coverage for herself and her family. Her children were not eligible for public plans, and she wasn’t aware of programs that could have covered the hospital expenses. Her son amassed $3,900 in bills that Davidson just couldn’t pay. That was nine years ago. By the time the bill was resolved as the result of a lawsuit, she owed, with interest, over $6,000. Collection agencies were garnishing her wages and had put a lien on her condo.

Much of her story is sadly typical. A survey published in May by the Commonwealth Fund, a nonprofit based in New York City, found that of the uninsured between 19 and 29, half had trouble making payments, had been contacted by a collection agency, or had modified their lifestyles to pay off medical bills.

And the cost hardly stops with lost purchasing power. The Commonwealth Fund’s survey found that more than half of those young and not covered had gone without needed medical care in the last year, which included not seeing a doctor, failing to fill a prescription, or skipping a recommended medical test, treatment, or follow-up visit.

Long Islander Fred Gumm, 26, now has health insurance through his job at Starbucks, which, he said, is “pretty much the only reason I work there.” He went without coverage for two and a half years, during and after school at SUNY-New Paltz. While uninsured, he broke a few fingers and injured his shoulder and his back. He didn’t go to the doctor because he couldn’t afford the bill, and as a result, the injuries healed badly and still trouble him.
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The story for middle-class kids these days is that you’re covered by your family’s insurance until you graduate college, and then you’re on your own. For those not in school, the cutoff comes even sooner. “You turn 19 and lose your parents’ coverage,” said Sara Collins, an economist for the Commonwealth Fund.

In theory, you quickly get a job that comes with insurance. That’s the way our system is designed to work, with employers rather than the government providing coverage. But as premiums have risen, companies have begun to consider forgoing health plans. In September, the trade journal BenefitsNews.com reported that among companies with 10 to 49 workers, the percentage of those offering insurance dropped from 66 percent to 62 percent. That four-point dip may not sound like much, but the journal estimated it could represent some 200,000 businesses. What’s more, young people tend to work for smaller firms” think entrepreneurial start-ups”and only 55 percent of companies with fewer than 10 workers carry health plans. A May 2003 report by the Commonwealth Fund found that 65 percent of working young adults are eligible for an employer-sponsored plan, compared to 77 percent of older adults.

What looked like a relatively seamless transition for your parents looks for you like a rickety bridge. You’re not making much money, you’ve got student debt, the job market stinks, and what jobs exist aren’t promising much. “The kinds of jobs you’re eligible for are the kinds that often don’t come with health insurance,” Collins said.

America’s approach to paying for medical care stretches back to World War II, when regulations made accident and health insurance for employees tax-exempt. Meanwhile, a simultaneous wage freeze and worker shortage encouraged employers to offer insurance as a perk to attract labor, explained Ken McDonnell, a research analyst with the Employee Benefit Research Institute.

During the same period, England instituted universal coverage. The reasons we didn’t are a complex knot of social and political influences now nearly impossible to untangle. “I think part of it is who’s being served here. In more homogeneous societies, like in Scandinavian countries, [universal health care] came as a no-brainer,” said David Jones, the president of the Community Services Society, a New York nonprofit. “But we’re not homogeneous. There’s a sense that ‘We’ve got ours, I’m not sure I want to give it to those guys.’ ” As employer-sponsored insurance took hold, the number of uninsured dropped steadily, reaching an all-time low of 23 million in 1976. But the very availability of good care quickly drove premiums up. In the 1980s, health care costs exploded, with annual increases peaking at 18 percent in 1989, before slowing briefly in the 1990s. Increases hit the double digits again in 2001, and reached 13.9 percent last year.

Perhaps not surprising, companies began to balk at providing benefits, leading individuals”the self-employed, the unemployed, the employed but not covered”to go it alone. Reforms designed to help the older and sicker buy private insurance served to further squeeze the able-bodied but vulnerable. Prices today are all over the map. A young, healthy adult in California can find basic catastrophic coverage for under $100 a month, but the same person could have to pay $280 for a similar plan in New York, largely due to differing state regulations.

For Lars Russell, in his early twenties, the cost of health insurance came as a shock. He graduated last year from the University of Michigan and moved to New York. “It’s not really anything I can afford,” he said in November. “I don’t even have car insurance right now.”
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Russell would get little sympathy from McDonnell, the benefits research analyst. “That’s life,” he said, when asked about the huge number of uninsured young adults. “If you’re young and healthy, you’re going to take risks. It’s life everywhere.”

McDonnell cited an unwillingness to pay for insurance as a big reason young adults go without coverage. It’s a fine line, however, between being unwilling to pay even $100 a month and being unable to. And it’s significant that when offered health insurance by an employer in exchange for a deduction from each paycheck, 74 percent of young adults take it, just a hair less than the 79 percent of older adults who do the same. “The argument is that if it’s that important to you, then get a job that offers health insurance,” said McDonnell, who, like so many experts on health care issues, is over 35 and has long had jobs with good benefits.

Janet Murray “who asked that her name be changed because of pending litigation” followed McDonnell’s advice. Now in her late twenties, she was born with hypothyroidism and takes daily medication. During her first year of college in upstate New York, she contracted Lyme disease. Because she caught it early, she doesn’t need constant treatment, though she is prone to exhaustion and respiratory infections like pneumonia. Her health problems don’t prevent her from working, but they make it impossible for her to do without good insurance. Murray studied film in college but gave up on her dream of working in movie production. Instead, she took an office job with a media company because it came with benefits.

“I think the biggest thing for me was, if I had the stamina and I didn’t have the general expenses of being on a bunch of medication, I would have taken more risks,” Murray said. “I feel like I don’t really have that luxury.”

Maybe her dreams wouldn’t have panned out, but the American health care system has made it nearly impossible for her even to try. Or maybe Murray is lucky. At 21, Pedro Jimenez of South Williamsburg said he has never had health insurance at all. “I don’t really know anything about it, to be honest,” he said. When necessary, he has gone to the emergency room and tried to pay off the bills in installments. Otherwise, he has avoided going to the doctor. But basically, he has avoided thinking about the dangers, focusing instead on looking for work, getting his GED, and going to college.

It’s important to note that degrees of coverage vary greatly by race: African Americans were nearly twice as likely as non-Hispanic white people to be uninsured in 2002, and Latinos three times as likely.
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Not having a job with benefits can mean being forced to choose between health insurance and other expenses, some of them critical to building a so-called life. Young adults “are in a stage where people have debts from school, they are trying to buy a house, and that seems more important than paying for health insurance, which might cost multiple thousands each year,” said Robert Blendon, a professor of health policy and political analysis at Harvard University.

The types and prices of plans for sale vary dramatically by state, largely according to regulations. Premiums nationwide for those under 35 average about $136 per month, according to eHealthInsurance, a website that sells individual and family insurance. Many states have plans with premiums below $100 for young, healthy adults without any pre-existing conditions. Cheaper plans are usually for emergencies only, don’t cover routine doctor visits, and carry four-digit deductibles.

At age 22, Kristen Gass had minor outpatient surgery to remove pre-cancerous cells from her cervix. At the time, she was working as an actress and had health insurance through the Actors’ Equity Association, a union that represents actors and stage managers working in theater. Soon after, she moved back home to Los Angeles, took a break from acting, and lost her coverage. When she looked into buying a policy, insurers quoted monthly premiums hundreds of dollars higher than she was able to afford, citing her recent surgery and a family history of cancer. They told her she would have to be without symptoms or treatment for at least two years before premiums would drop. So she went without.

“I just didn’t go to the doctor,” Gass said. “I went once for a checkup and that was it. I realized how much it would cost.” Had she been in New York, the cost of individual insurance would have been the same regardless of her history. But she still couldn’t have afforded it.

Only one New York insurer has posted a plan on eHealthInsurance, at am monthly premium of $280. The plan covers hospitalization but not doctor visits. According to the New York State Insurance Department, basic HMO plans start at $320 a month. The self-employed may be able to get insurance at group rates through organizations in their field. One of the more popular comes from the Freelancers Union “part of Working Today” which offers HMO coverage, including vision and dental, for $286 through Health Insurance Plan of Greater New York.

Just as race plays a factor, so does gender. By the time he reaches age 34, the average Joe earns $30,677, and could expect to pay 11 percent of that gross for the cheapest plan in New York. The average Jane, earning $21,649, would fork over 4 percent more.
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If the cost of insurance is unbearable, so is the cost of not having it. Even common injuries can be financially debilitating for people still trying to get on their feet. Manhattan resident Drew Brown, uninsured and unemployed, went to the emergency room at Beth Israel for a toothache and left with a prescription and a $500 bill. Brooklynite Andrea Craig had to pay $2,000 for surgery to treat a mouth infection before she got insurance through her current job. Some people have almost gotten used to it. “If I get sick, I go to the emergency room. I usually give them my real name. I get bills. If they are reasonable I pay them. If not “if they’re, like, four or five grand”I ignore them,” said a 35-year-old Manhattan photographer who refused to give his name.” The emergency room is the only place I go. It’s the only place that’s free.” High numbers of uninsured strain hospital budgets because emergency rooms can’t deny care to those who can’t pay, Harvard professor Blendon said. Disease outbreaks are worsened when a significant fraction of the population doesn’t have insurance. “We’ve lucked out because we haven’t had any big epidemics, but with SARS and anthrax it really struck experts that you are going to have people getting sick and not going to the doctor,” Blendon said. “Canada didn’t have that problem.”

The only real fix is universal health care, said Ken McDonnell, and with the current political climate, he says, such a policy has “a snowball’s chance in hell.” Estimates of the cost range from a net savings to a new burden of trillions. A study published by the journal Health Affairs estimated that extending coverage to the uninsured would lead to extra spending on the order of $33.9 billion to $68.7 billion each year as the newly insured sought additional medical care.

Short of universal health care, most reforms still leave young adults at risk. For now, many go it alone, scrounging up care where possible and resigning themselves to the hope that lighting won’t strike. After all, millions of people do it.

Willingness of the insured to cover the uninsured

Willingness of the insured to cover the uninsured

Journal of General Internal Medicine
August 2004
Will Insured Citizens Give Up Benefit Coverage to Include the Uninsured?
By Susan Dorr Goold, MD, MHSA, MA, Stephen A. Green, MD, MA, Andrea K.
Biddle, PhD, MPH, Ellen Benavides, MHA, Marion Danis, MD

OBJECTIVE: To describe the willingness of insured citizens to trade off their own health benefits to cover the uninsured.

DESIGN: Descriptive study of individual and group decisions and decision making using quantitative and qualitative methods.

SETTING AND PARTICIPANTS:Twenty-nine groups of citizens (N= 282) residing throughout Minnesota.

INTERVENTIONS: Groups participated in Choosing Healthplans All Together (CHAT), a simulation exercise in which participants choose whether and how
extensively to cover health services in a hypothetical health plan constrained by limited resources. We describe individual and group decisions, and group dialogue concerning whether to allocate 2% of their premium to cover uninsured children in Minnesota, or 4% of their premium to cover uninsured children and adults.

MEASUREMENTS AND MAIN RESULTS: While discussing coverage for the uninsured, groups presented arguments about personal responsibility, community
benefit, caring for the vulnerable, social impact, and perceptions of personal
risk. All groups chose to insure children; 22 of 29 groups also insured adults.
More individuals chose to cover the uninsured at the end of the exercise, after group deliberation, than before (66% vs 54%; P < .001). Individual selections differed from group selections more often for the uninsured category than any other. Nevertheless, 89% of participants were willing to abide by the health plan developed by their group. CONCLUSION: In the context of tradeoffs with their own health insurance benefits, groups of Minnesotans presented value-based arguments about covering the uninsured. All 29 groups and two thirds of individuals chose to
contribute a portion of their premium to insure all children and most groups chose also to insure uninsured adults.

http://www.blackwell-synergy.com/links/doi/10.1111/j.1525-1497.2004.32102.x

Comment: Two thirds of us believe in including everyone in the insurance risk pool, and nine tenths of us would be willing to abide by the health plan supported by the two thirds majority. Isn’t that strong enough support to move forward with a program of universal health care coverage?

Pfizer's free drugs and the $800 million pill

Pfizer’s free drugs and the $800 million pill

Pfizer
News Release
July 7, 2004
Pfizer to Launch Comprehensive Initiative Expanding Access to Prescription Medicines for Millions of Americans

Pfizer Inc said today it will launch the pharmaceutical industry’s most comprehensive initiative to significantly expand access to prescription medicines across the United States, with a specific focus on enabling America’s 43 million uninsured to obtain Pfizer medicines at significant savings.

With enrollment beginning in August, Pfizer will provide millions of working families without drug coverage access to Pfizer medicines at an average savings of 37 percent.

“I applaud the steps Pfizer is taking today, which will provide America’s uninsured with access to medicine at significant savings. Pfizer is helping those in dire need get the medicine they often require. This effort holds the promise of helping people in real need, and that is vitally important,” said U.S. Senator Hillary Rodham Clinton (D-NY).

http://www.pfizer.com/are/news_releases/2004pr/mn_2004_0707.html

Frequently Asked Questions about Pfizer Pfriends
Does this new program provide health insurance or coverage for the uninsured?

The actions that Pfizer is taking are a first step, not a total solution for the uninsured. We believe that every American should have access to quality, affordable health insurance. In order to get to a place where every American
has access to quality, affordable health care, we will need to develop a solution that involves government, medical professionals, nonprofits and the private sector. Pfizer is committed to playing an active role in getting to that solution.

http://www.pfizer.com/are/news_releases/2004pr/mn_2004_0707_qa.html

The New York Times
July 8, 2004
Drug Companies Seek to Mend Their Image
By Gardiner Harris

Acknowledging its dismal public standing, Pfizer, the nation’s largest drug company, held a news conference on Wednesday to announce an effort to provide discounted drugs to the working poor and anyone without health insurance.

In a series of presentations, executives at Pfizer, which is based in New York, said yesterday that they were starting the discount program – whose cost will not significantly affect the company’s profits, they said – because it was the right thing to do.

New America Foundation
July 8, 2004
The $800 Million Pill: What Drives the Cost of Prescription Drugs?

Why do life-saving prescription drugs cost so much? Drug companies insist that prices reflect the millions they invest in research and development. In his book The $800 Million Pill, Merrill Goozner contends that American taxpayers are in fact footing the bill twice: once by supporting government-funded research and again by paying astronomically high prices for prescription drugs. Goozner demonstrates that almost all the important new drugs of the past quarter-century actually originated from research at taxpayer-funded universities and at the National Institutes of Health.

He reports that once the innovative work is over, the pharmaceutical industry often steps in to reap the profit. Goozner shows how drug innovation is driven by dedicated scientists intent on finding cures for diseases, not by pharmaceutical firms whose bottom line often takes precedence over the advance of medicine. The $800 Million Pill suggests ways that the government’s role in testing new medicines could be expanded to eliminate the private sector waste driving up the cost of existing drugs.

http://www.newamerica.net/index.cfm?pg=event&EveID=392

Comment: Pfizer’s program creates an administrative nightmare with multiple means-tested programs which will place a significant burden on the health care delivery system. The program will be limited to Pfizer’s products, thereby excluding most prescriptions. Most of the uninsured will still not be able to afford their share of the payment for the drugs in these programs. Since Pfizer has indicated that their generosity will not have a detrimental impact on profits, they obviously realize that this program will have a negligible impact when compared to existing needs.

The conclusions in Merrill Goozner’s report lead to a persuasive argument that Pfizer and the other pharmaceutical firms have an ethical obligation to cooperate with our public agencies in ensuring that everyone has affordable access to essential medications.

Pfizer states that they are “committed to playing an active role” in getting to a solution, which involves the government, wherein every American would, have access to “quality, affordable health insurance.” Pfizer would have more credibility if we saw the least inkling of “playing an active role in getting to that solution.”