PNHP

Drug co-payments benefit plans, not patients

Drug co-payments benefit plans, not patients

JAMA
October 9, 2002
Employer Drug Benefit Plans and Spending on Prescription Drugs
By Geoffrey F. Joyce, PhD; José J. Escarce, MD, PhD; Matthew D. Solomon, MA;
Dana P. Goldman, PhD

We found that many of the tools used to influence pharmaceutical use were
effective in reducing drug expenditures for working-age enrollees with
employer-provided drug coverage. Adding an additional level of co-payment,
increasing existing co-payments or coinsurance rates, and requiring MGS
(paying co-payments plus differences in cost between the brand and generic
drugs) all reduced health insurance plan payments significantly.

Patient out-of-pocket spending did not change substantially within a
specific benefit design, because the reduction in overall drug use due to
higher patient cost-sharing largely offset the effects of higher co-payments
per prescription.

Several studies have found that spending caps and formulary restrictions
reduced use of both essential and nonessential medications among low-income
and elderly populations.

Conclusions: Adding an additional level of co-payment, increasing existing
co-payments or coinsurance rates, and requiring mandatory generic
substitution all reduced plan payments and overall drug spending among
working-age enrollees with employer-provided drug coverage. The reduction in
drug spending largely benefited health insurance plans because the
percentage of drug expenses beneficiaries paid out-of-pocket rose
significantly.

http://jama.ama-assn.org/issues/v288n14/abs/joc21507.html

Comment: We continue on the path of developing and expanding policies that
benefit health insurance plans, to the detriment of patient coverage. When
will we finally accept the concept that health policy should be designed to
benefit patients?

Universal care hinges on cost

http://www.oregonlive.com/elections/oregonian/index.ssf?/xml/story.ssf/html_standard.xsl?/base/news/103399171483813.xml

Cast against a national backdrop of eroding health coverage, Oregon moves into the spotlight next month with a ballot measure that would create a single statewide health plan for virtually all residents.

Consumer activists, senior citizen groups and church organizations have spent years trying to advance similar “single payer” health changes in state legislatures from Oregon to Vermont. But their grass-roots organizing efforts have been defeated repeatedly, with the opposition primarily led by the powerfully funded insurance and hospital industries.

This time, they’re using a different approach, and because Oregon’s Measure 23 is the first single-payer proposal to go directly before voters since 1994, it’s drawing national attention to the campaign.

“It’s the only state where people are going to get to vote in November on universal health care,” said Dr. Ida Hellander, executive director of Physicians for a National Health Care Program in Chicago. The group represents about 9,000 doctors.

“If the Oregon measure passes, it’s just the beginning,” Hellander said. “It shows that it can be done, that it can work.”

Supporters of Measure 23 say it would solve the problems of rising health costs, uncertain access to caregivers and haphazard limits on coverage. The plan would pay for practically all health services, and extend coverage to the 444,000 children and adults in Oregon who now go without health insurance, according to the latest Census estimates.

Opponents say the plan’s billions of dollars in added taxes on personal income and employer payrolls would undermine Oregon’s already faltering economy. The agency created by the measure would command a $20 billion annual budget and have the power to impose up to $10.8 billion in new taxes in the first year of implementation, which would be 2005.

Business groups and other opponents say health spending would surge under the measure. The reason, they say, is the plan adds coverage for many services that most people now pay for on their own, such as alternative medicine practitioners and prescription drugs for Medicare enrollees.

At the same time, critics say, the measure imposes no specific limits or consumer cost-sharing provisions to discourage excessive use.

“The reality is, it’s inevitable these costs are going to rise rapidly, because you are talking about virtually unlimited options where people could access care free at the point of service,” said Pat McCormick, spokesman for No Unhealthy Taxes for Oregon.

Health insurers and other opponents have given more than $400,000 to the campaign — outspending Measure 23 supporters by more than 18 to 1, according to financial disclosures filed this month. Kaiser Permanente, Regence BlueCross BlueShield of Oregon, Pacificare, PacificSource and ODS Health Plans have each contributed more than twice the total raised by supporters, $22,023.

No more HMOs? Despite heavy spending by opponents, the measure might appeal to many voters who resent managed-care companies and — with the recession — fear losing their health coverage, according to some campaign watchers.

“There is great popular unhappiness with HMOs and health care in general,” said Bill Lunch, political science professor at Oregon State University.

“If somehow, the proponents can make the connection between the problems and Measure 23 as the solution, it is not inconceivable that it could prevail,” Lunch said.

Advocates say eliminating insurance company overhead costs and profits would allow the state to provide universal coverage for less money than employers, individuals and government programs currently spend.

Mark Lindgren, chairman of Health Care for All — Oregon, the coalition behind Measure 23, said it would “vastly reduce” the existing health care bureaucracy. Administrative costs would be capped at 5 percent, compared with the 12 percent overhead typical among health insurance companies in Oregon.

“There is such huge savings possible by cutting out the middleman and bargaining aggressively with pharmaceutical makers,” Lindgren said. “Individual costs should go down, and it’s likely to be a really good deal for Oregon business as well.”

The single statewide health plan would largely replace the jumble of private and public programs that now pay for health care, including individual insurance policies, most employer-sponsored health plans, workers’ compensation medical claims, the state and federally funded Oregon Health Plan for the poor and the federal Medicare program for retirees. Oregon would have to gain approval from the federal government to tap Medicare and the federal money now going to the Oregon Health Plan.

A board with 10 elected members and five appointed by the governor would run the plan. The board’s powers would include setting the fees paid to medical caregivers — which the hospital industry and many doctors strongly oppose. The Oregon Medical Association, the state’s largest physician organization, and the Oregon Association of Hospitals and Health Systems oppose the measure.

“You’ve got a problem already with health care providers who are opting not to accept low government reimbursement,” McCormick said. “You would be providing an incentive for providers to move to other states.”

To draw union support, drafters of the measure left room for health plans run by labor-management health care trusts. Employers and union workers opting to continue such plans would be exempt from the payroll and income taxes.

Despite that provision, the Oregon AFL-CIO recently announced its opposition, citing the increased tax burden on working people.

“We believe a universal health care system is the right way to go, but the burden of responsibility for paying for this one, we believe, is inappropriate,” said the AFL-CIO’s Lynn-Marie Crider. “We believe the responsibility should be borne primarily by the employers.”

Views differ on tax burden The AFL-CIO position highlights measure supporters’ toughest sell: persuading voters to pass a multibillion-dollar tax increase while the state struggles to emerge from recession. Opponents are seizing on the tax burden to sway voters.

“You are going to drive employers out of state or close their doors by imposing an 11 percent payroll tax,” said Mark Nelson, the lobbyist heading the opposition.

According to supporters’ calculations, the plan would cost the state about $19.9 billion in its first year. Existing government programs would cover about two-thirds of the costs. The remaining third, about $6.3 billion, would come from additional taxes. Estimates by the Oregon Department of Administrative Services suggest the additional tax burden could come closer to $10 billion the first year.

Supporters say most Oregonians would pay less in taxes than they currently spend on premiums, co-payments and out-of-pocket costs for doctors, dentists, home health supplies, prescription drugs excluded by private health insurance and Medicare, and long-term care — which all would be covered by the single-payer plan.

Households earning less than 150 percent of the poverty level, currently about $27,000 for a family of four, would be exempt from the income tax increase. The tax rate would increase with income, up to a maximum of an additional 8 percent, which would nearly double the current top tax rate of 9 percent.

Supporters are appealing to voters’ worries about the security of their health care coverage when many employers are cutting benefits or raising the share of costs borne by workers.

“Premiums are going up ridiculously. People are losing jobs and health coverage. Things are getting worse every day,” Lindgren said. “It’s not just wild-eyed liberals saying this.”

Joe Rojas-Burke: 503-412-7073, joerojas@news.oregonian.com

Copyright 2002 Oregon Live. All Rights Reserved.

New Mexico Rallies for Universal Health Care

Prominent physicians, medical students and seniors unite in support of single-payer health care reform

CHICAGO, IL, October 3, 2002 � October 1-8 is Universal Health Care Awareness Week in Albuquerque, New Mexico, bringing national attention to 25% of New Mexico residents who do not have health insurance. Health Students for Social Action (HSSA) and the Gray Panthers, a senior activist group in Albuquerque, have teamed up to organize a week of events to educate people about single-payer health care reform. An independent study by the Lewin group shows that developing a universal health care system is not only affordable, it’s cost effective. Lewin calculated that New Mexico would save millions of dollars by adopting a universal single-payer system.

Event highlights include a highly anticipated October 4 debate between Dr. McCanne, M.D., president of Physicians for a National Health Program (PNHP), and Dr. David Scrase, president of Presbyterian HMO, on the topic of financing health care.

Dr. McCanne is a retired family physician in San Clemente, California. For three decades, he allotted one-half of his practice hours to indigent patients. Dr. McCanne was a tireless supporter of Proposition 186, the California single-payer initiative, defeated by $10 million in insurance industry funded opposition. He has written extensively in the lay press on single-payer and patient-oriented health care, often using the concept of �Universal Medicare” as a model for single payer that the public can understand and support. He has elected to dedicate the remainder of his productive years to full-time activism on behalf of the single-payer cause. PNHP is membership organization of doctors that supports universal health care.

David R. Scrase, MD, is a Board Certified Internist and Geriatrician who has been involved in market-driven managed care for almost two decades. Dr. Scrase practices in Albuquerque, New Mexico.

�As a fourth-year medical student,� says Michael Walta, of HSSA, �I see patients everyday, facing hardship, bankruptcy, or just plain being turned away at the door. We are taking this issue away from the politicians, who are failing us, and bringing the message of universal coverage to those who are being abused by the health care crisis: the working poor, the elderly, and the middle-class.�

Linda Peeno, M.D., nationally known for exposing problems in corporate managed care, will be the keynote speaker at a panel discussion October 5. Peeno is a family practioner, a medical ethicist, and advisor on legal cases against giant for-profit HMOs. Peeno was recently the subject of the Showtime feature film �Damaged Care,� starring Laura Dern (Jurassic Park.)

The week concludes on Sunday with a “Run to Cover Everyone,” sponsored by HSSA, followed by a rally at the National Hispanic Cultural Center.

“New Mexicans deserve comprehensive affordable health insurance,” said Jaime Aagaard, of HSSA. �Medical students are demanding change from our elected leaders”.

More than one-third of Hispanics are uninsured; in some cities the figure is as high as one-half. New Mexico now joins Vermont, Maine, Massachusetts, California, and Oregon in the ever-growing movement supporting single-payer health care reform. For more information about the Run to Cover Everyone go to: www.runtocovereveryone.net

# # #

Physicians for a National Health Program has been advocating for health care reform for 15 years with more than 10,000 members across the United States.
PNHP is headquartered in Chicago.

www.pnhp.org

Universal Health Care Week October 1- 8, 2002
Albuquerque, New Mexico

TUESDAY,OCTOBER 1 & THURSDAY, OCTOBER 3

FUN RUN
Noon: register to sign up for “Run to Cover Everyone” and buy raffle tickets. Outside BMSB, sponsored by Health Students for Social Action (HSSA), noon-1pm.
Contact: 505-907-6655
Email: funrun@twignation.com
http://runtocovereveryone.net

FRIDAY, OCTOBER 4

Grand Rounds
8am: Ob/Gyn Grand Rounds, Dr. Don McCanne, president of Physicians for a National Health Program (PNHP). HSSB 105.

Q&A with Dr. Don McCanne
Noon: Informal Question/Answer Session with Dr. Don McCanne, expert on the single-payer healthcare system.
BMSB basement room 53.

Health Care Financing Debate
5pm: Healthcare Financing Debate, Dr. David Scrace, president of Presbyterian Health Program vs. Dr. Don McCanne.
Nursing and Pharmacy Bldg, auditorium.

Reception
6:30pm: Reception for Dr. Don McCanne, sponsored by local PNHP chapter.
SATURDAY, OCTOBER 5

Universal Health Care Panel
7pm Universal Healthcare Panel, Santa Fe. Sponsored by Green party. Keynote speaker Dr. Linda Peeno, famous whistleblower on corporate managed care, and Dr. Don McCanne.
Call 505-992-3335 for info.
SUNDAY, OCTOBER 6

Reception
10am Reception for Nick Unger of Universal Healthcare Action Network (UHCAN). Contact: 505-899-0392

Run to Cover Everyone
1-5pm Run to Cover Everyone, followed by Rally with free food, live music (Tobias Rene), raffle, plus more. National Hispanic Cultural Center, 4th and Bridge SE. Contact: 907-6655 for info.

Canadian Auto Works Support Medicare

Sep. 21, 01:00 EDT
Carol Goar
THERE’S ALWAYS a surprise when Buzz Hargrove negotiates a contract with one of the country’s auto giants.

Three years ago, it was a generous child care subsidy. Ford of Canada agreed to provide parents of preschoolers with up to $2,000 a year to help defray their child care expenses. Nothing like that had ever been achieved at the bargaining table.

This time, it was a corporate endorsement of medicare. Hargrove persuaded Michael Grimaldi, president of General Motors of Canada, to praise publicly funded health care and call for its expansion to include prescription drugs and home care. No high-profile business leader has done this.

It was a gratifying week for the president of the Canadian Auto Workers. Not only did he reach a trendsetting deal with General Motors five hours before the strike deadline, he played a role in the health-care debate.

He can’t declare victory yet. Workers at GM’s five plants have to ratify Tuesday’s tentative agreement and Hargrove has to win comparable settlements for his members at Ford and DaimlerChrysler.

But he has achieved his goal on medicare. The top executives of the Big Three automakers have all signed a letter endorsing Canada’s publicly funded health-care system and asking that it be enlarged. “The system needs a secure multi-year funding base from the government and must be expanded to cover an updated range of services including prescription drugs and home care,” the statement says.

It would be naïve to believe that senior auto executives — particularly Grimaldi who is American — would stand up for socialized medicine out of a sense of public spiritedness.

They did it because it cost them nothing, it improved the bargaining climate and it clearly mattered to the CAW.

But that is not the whole story. Hargrove had tried to put medicare on the table in past bargaining rounds, but had always been rebuffed. The heads of the car companies would admit privately that Canada’s public health-care system was a godsend, sparing them the expense of providing comprehensive medical insurance to their employees. But they would never say it in public.

This time, they agreed. Several factors changed their attitude:
*
The CAW was able to quantify, using credible corporate data, the competitive advantage that medicare provides to the Canadian auto industry.

The union compared the hourly labour costs of vehicle assembly in Canada and the United States. The Canadian rate, including wages, benefits and payroll taxes, was $29.90 per hour. The American rate was $45.60. (All figures are in American dollars.)

Health care accounted for more than a quarter of the difference. It saved Canadian employers $4 per hour per worker.

“It’s a strategic advantage for Canada,” said Grimaldi, at a joint press conference with Hargrove.
*
Management was concerned about the escalating cost of workplace health benefits.

Drug costs were rising rapidly. Acutely ill patients were being sent home to recover, needing private nursing and home care. More and more medical services were being “delisted” by provincial governments, forcing employers to step in.

The union did not have to make the case that the erosion of medicare had real consequences for business. The car companies were feeling the effects.
*
The health-care outlook worried corporate accountants.

With an aging population, ever-more sophisticated medical technology and a global bidding war for doctors and nurses, it was clear that health costs could only climb.

The less governments covered, the more individuals and their employers would have to pick up. What had once looked like a costly social program to auto executives began to have bottom-line appeal.

It would be a mistake to read too much into a simple endorsation of medicare.

The auto executives did not agree to do anything specific to support or strengthen medicare. They did not challenge other business leaders to speak out. They did not grapple with the difficult question of how to pay for a pharmacare plan or a national home-care program. They certainly did not say that they’d be open to a tax increase to sustain Canada’s publicly funded health-care system.

But they did take a stand. They did acknowledge that medicare is good for business.

Hargrove contends that their intervention came at a perfect time to influence the Romanow Commission, which is now drafting its final report on the future of medicare.

In fact, the automakers’ statement probably came too late — and said too little — to affect Roy Romanow’s prescriptions in any material way.

But it was well-timed to suit Hargrove’s agenda. The CAW president is pondering a run for the leadership of the New Democratic Party. He has said he will make up his mind when he completes this round of auto bargaining.

The 58-year-old labour leader has been highly effective at getting good deals for his members, while nudging the country’s social agenda forward.

But he’s had the resources of the country’s largest private-sector union behind him. He’s dealt with rich, pragmatic employers. He’s known the drama of late-night dealmaking and the euphoria of winning.

Hargrove might find politics a comedown.

GREG KEENAN
AUTO INDUSTRY REPORTER

Canada’s system of government-financed health care represents about
half the cost advantage General Motors of Canada Ltd.’s assembly
plants have over U.S. plants, GM Canada president Michael Grimaldi
says.

The health care system is a “strategic advantage,” for Canada, Mr.
Grimaldi said yesterday as he and Canadian Auto Workers union
president Buzz Hargrove unveiled a joint letter that the union and all
Big Three auto makers are sending to Ottawa.

“The public health care system significantly reduces total labour
costs for automobile manufacturing firms, compared to the cost of
equivalent private insurance services purchased by U.S.-based auto
makers; these health insurance savings can amount to several dollars
per hour of labour worked,” the union, GM, DaimlerChrysler Canada Inc.
and Ford Motor Co. of Canada Ltd. said in the joint statement.

“The erosion of publicly funded health care — through measures such
as the delisting of currently covered services, the imposition of user
fees, the failure of the public system to keep up with the changing
nature of health care and new costs such as prescription drugs and
home care — will impose significant costs on automotive employers and
undermine the attractiveness of Canada as a site for new automotive
investment,” the letter said.

The public health care system also makes Canadian workers healthier
and more productive, the letter added.

Mr. Grimaldi said preserving and enhancing the health care system will
make it more attractive for GM Canada to continue making investments
here.

He cited the addition of a third shift at one of the company’s car
plants in Oshawa, Ont., and a $500-million investment at Cami
Automotive Inc., a joint venture assembly plant operated with Suzuki
Motor Co. Ltd.

The joint statement comes as the CAW is locked in contract talks with
the Big Three. At the moment, it is negotiating with GM Canada with a
deadline of next Tuesday night for a new contract.

Those talks are going well, both Mr. Hargrove and Mr. Grimaldi said,
while tossing compliments at each other.

Mr. Hargrove said he’s hoping for a first wage offer from the company by as early as today.

“A lot of money and a lot of jobs will get you an agreement, Mike,” he
told Mr. Grimaldi.

But the focus yesterday was on health care, including during the
talks.

Mr. Hargrove said a presentation from GM Canada’s health care provider
showed that “some of the increases we’re facing in drugs are
astronomical.”

GM Canada’s parent, General Motors Corp., is facing similar
challenges, Michael Bruynesteyn, an analyst for Prudential Securities
Inc., noted in a recent report.

“We understand from GM that it is the world’s largest purchaser of
Viagra, a benefit not usually covered by many U.S. employers’ health
care plans,” Mr. Bruynesteyn noted.

Between employees, retirees and their dependents, GM pays for health
care benefits for about 1.25 million Americans, roughly the population
of Manitoba, Stephen Girsky, an auto industry analyst for Morgan
Stanley, noted in a report on GM last year.

The costs of that service amounted to $3.9-billion (U.S.) in 2000, Mr.
Girsky noted.

That in turn, represented a little more than $900 on every vehicle GM
assembled in the United States in 2000.

United stand on health care
CAW, GM leaders urge Ontario, Ottawa to increase public funding
By Steve Arnold
The Hamilton Spectator

Corporate and union leaders of Canada’s auto industry have issued a united
call for increased government health care funding.
In an unprecedented move yesterday, the presidents of the Canadian Auto
Workers union and the Big 3 auto makers signed a joint letter urging the
federal and provincial governments to recognize the important role publicly
financed health care plays in the country’s economy.
“The success of (the auto) industry has been crucial to Canada’s economic
progress over the past decade,” the letter states. “Canada’s health care
system has been an important ingredient in the auto industry’s performance.”

GM Canada president Michael Grimaldi and CAW leader Buzz Hargrove told a
news conference that about half of the labour cost advantage Canadian auto
plants enjoy over American competitors can be attributed to the national
health care system, and losing that advantage would cost jobs.
“Canada’s health care system is an important part of Canadian culture, a
significant factor in Canada’s economy and we must ensure it plays that role
in the future,” Grimaldi said. “Health care is important to the country and
to the auto industry and we’re looking to the policy makers … to look at
the system and make sure it addresses the needs of Canadians.”
In the letters, which were also signed by Ford Canada president Alain Batty
and DaimlerChrysler Canada head Ed Brust, the industry leaders worry that
measures such as reducing the number of services covered by the public plan,
increasing user fees, the failure to include important new treatments on the
list of covered procedures and the ever-rising cost of prescription drugs
will lead to higher employment costs as workers push for higher wages or
better benefit plans to protect their standard of living.
Those increases, in turn, would mean higher vehicle prices or less
investment in Canada as companies turn to low-wage countries like Mexico.
“For both employers and workers in the auto industry, it is vitally
important that the publicly funded health care system be preserved and
renewed,” the letter states. “The system needs a secure multi-year funding
base from government, and must be expanded to cover an updated range of
services (including prescription drugs and home-care services) that reflects
both the evolving nature of medical science and the emerging needs of our
population.”
Fear for the future of the public system has been growing for several years
as governments have struggled to offer tax cuts while also trimming debts
and eliminating deficits. A commission under former Saskatchewan Premier Roy
Romanow has been touring the country looking at that question and is to
issue a final report later in the year.
A persistent fear has been that the commission will recommend increased
private involvement in health care — creating a two-class system in which
the wealthy get preferred treatment while others suffer.
The comments in the joint letter echo those made to the commission by the
CAW and United Steelworkers of America.
In its brief, for example, the CAW recommended expanding coverage under the
Canada Health Act to include pharmacare, homecare, long-term care, the
development of national standards and programs and increased spending on
health promotion.
When USWA national director Lawrence McBrearty made his presentation in May,
he dismissed arguments of a “crisis” in the public system, calling them a
creation of “politicians, whose priority is cutting taxes rather than
preserving essential public services, commissions with tainted credentials
and think-tanks supported by the private health care industry … The crisis
is that the self-interested and profit seeking in this country are engaged
in a deliberate campaign to undermine confidence in our public health care
system, as a prelude to its destruction.”
In the U. S. steel industry, he added, health insurance costs are 18 per
cent of total employment costs compared to between 4 and 6 per cent in
Canada.
“We do not have a crisis of ability to pay,” he added. “We have a crisis …
in which a self-interested and profit seeking elite is working to prevent
Canadians from getting what they clearly want.”
The call for continued support of the public system has also been sounded by
Charles Baillie, chairman and CEO of Toronto Dominion Bank, who told an
audience in 1999, “in an era of globalization, we need every competitive and
comparative advantage we have and the fundamentals of our health care system
are one of those advantages … It is high time that we in the private
sector went on the record to make the case that Canada’s health care system
is an economic asset … that our country dare not lose.”
Yesterday’s statements came as GM and the CAW enter the final stage of
negotiations for a new three-year agreement. The contract expires Tuesday
and both Grimaldi and Hargrove said they are confident of reaching a deal
before the deadline.
“The pace of negotiations is on track,” Hargrove said. “There is a lot left
to resolve, but the mood is good, there’s no animosity, and we have plenty
of time and lots of experience on both sides.”
CAW and healthcare. Story by Steve Arnold

CAW, auto makers laud health system
By GREG KEENAN
AUTO INDUSTRY REPORTER

Friday, September 13, 2002 – Globe and Mail

Canada’s system of government-financed health care represents about half the
cost advantage General Motors of Canada Ltd.’s assembly plants have over
U.S. plants, GM Canada president Michael Grimaldi says.
The health care system is a “strategic advantage,” for Canada, Mr. Grimaldi
said yesterday as he and Canadian Auto Workers union president Buzz Hargrove
unveiled a joint letter that the union and all Big Three auto makers are
sending to Ottawa.
“The public health care system significantly reduces total labour costs for
automobile manufacturing firms, compared to the cost of equivalent private
insurance services purchased by U.S.-based auto makers; these health
insurance savings can amount to several dollars per hour of labour worked,”
the union, GM, DaimlerChrysler Canada Inc. and Ford Motor Co. of Canada Ltd.
said in the joint statement.
“The erosion of publicly funded health care — through measures such as the
delisting of currently covered services, the imposition of user fees, the
failure of the public system to keep up with the changing nature of health
care and new costs such as prescription drugs and home care — will impose
significant costs on automotive employers and undermine the attractiveness
of Canada as a site for new automotive investment,” the letter said.
The public health care system also makes Canadian workers healthier and more
productive, the letter added.
Mr. Grimaldi said preserving and enhancing the health care system will make
it more attractive for GM Canada to continue making investments here.
He cited the addition of a third shift at one of the company’s car plants in
Oshawa, Ont., and a $500-million investment at Cami Automotive Inc., a joint
venture assembly plant operated with Suzuki Motor Co. Ltd.
The joint statement comes as the CAW is locked in contract talks with the
Big Three. At the moment, it is negotiating with GM Canada with a deadline
of next Tuesday night for a new contract.
Those talks are going well, both Mr. Hargrove and Mr. Grimaldi said, while
tossing compliments at each other.
Mr. Hargrove said he’s hoping for a first wage offer from the company by as
early as today.
“A lot of money and a lot of jobs will get you an agreement, Mike,” he told
Mr. Grimaldi.
But the focus yesterday was on health care, including during the talks.
Mr. Hargrove said a presentation from GM Canada’s health care provider
showed that “some of the increases we’re facing in drugs are astronomical.”
GM Canada’s parent, General Motors Corp., is facing similar challenges,
Michael Bruynesteyn, an analyst for Prudential Securities Inc., noted in a
recent report.
“We understand from GM that it is the world’s largest purchaser of Viagra, a
benefit not usually covered by many U.S. employers’ health care plans,” Mr.
Bruynesteyn noted.
Between employees, retirees and their dependents, GM pays for health care
benefits for about 1.25 million Americans, roughly the population of
Manitoba, Stephen Girsky, an auto industry analyst for Morgan Stanley, noted
in a report on GM last year.
The costs of that service amounted to $3.9-billion (U.S.) in 2000, Mr.
Girsky noted.
That in turn, represented a little more than $900 on every vehicle GM
assembled in the United States in 2000.

Where is the health care reform debate?

The Washington Times
September 30, 2002
Better to act than act shocked
By Greg Scandlen

President Bush has proposed legislation addressing all three ideas – tax
credits, MSA expansion and AHPs. Adopting these three ideas would be the
most serious assault on the problem of the uninsured in more than 35 years.

These are also the only viable ideas currently on the table. Some who prefer
to have the government run everything have argued for expanding Medicaid,
the government’s health care program for the poor, to include all of the
uninsured.

http://washingtontimes.com/commentary/20020930-94445632.htm

Comment: It is not surprising to see the conservative views of the National
Center for Policy Analysis published in the conservative Washington Times.
But what is of concern is that the debate over health care reform seems to
be a debate between those that favor the conservative approaches of the Bush
administration, approaches that totally lack compassion, with those that
favor tweaking our public welfare programs, Medicaid and SCHIP, as if that
would solve our problems.

Those that support public-program tweaking should realize that in their zeal
to move to the right on reform, they are being characterized as individuals
who “prefer to have the government run everything.” In reality, there is not
much difference between the conservatives and the incrementalists. Combined,
they represent one side of the health care debate, although it is to the
advantage of the conservatives to represent incrementalists as the liberal
option.

The genuine other side is represented by those who support true health care
justice: an affordable, comprehensive, equitable, publicly-administered,
universal health insurance program. Let’s all make a greater effort to be
sure that the nation understands this, the moral imperative.

Death spiral of comprehensive coverage

Los Angeles Times
September 29, 2002
Rising Costs Put Pressure on Kaiser
By Don Lee

Kaiser Permanente is having one of its brightest financial years ever, but
beneath the rosy numbers lies a harsh reality: The company is facing a
challenge that threatens the survival of the managed-care model that it
pioneered decades ago.

The nation’s leading nonprofit HMO and hospital system and its 11,000
doctors are being confronted by the rising costs of treating its aging
membership, while more bare-bones health plans are drawing away the coveted
young and healthy consumers.

As the nation heads into the third straight year of double-digit health-cost
increases, with no relief in sight, the insurance industry is devising more
plans with skinnier benefits and fatter member co-payments and deductibles.
Employers want them because they minimize premium increases, and the plans
are especially appealing to young, healthy individuals who don’t want to pay
higher premiums for comprehensive coverage they don’t think they’ll ever
use.

These changes will be increasingly visible to millions of Americans at open
enrollments this fall. Many will be offered so-called consumer-driven plans,
which will allow employees to tap into a savings account to pay for medical
services as needed.

The Oakland-based health system has been a model of managed care, providing
a basic full-coverage plan for all members…

But like those of other HMOs and health plans, Kaiser’s premiums have soared
in the last couple of years. That raises the question of whether Kaiser can
maintain its one-shoe-fits-all approach and its competitive edge, and avoid
segmenting the membership.

In a recent memo to the staff, George Halvorson, Kaiser’s new chief
executive, laid out the dilemma this way: “Those shifts [in the marketplace]
will cause many of our healthiest members to leave us for lower-cost,
lower-benefit plans. At the same time, employers will save money if their
sicker patients voluntarily migrate to us.”

http://www.latimes.com/business/la-fi-kaiser29sep29,0,845054.story?coll=la%2
Dheadlines%2Dbusiness

Comment: This is a disaster! Not just for Kaiser, but for our entire system
of funding health care through private plans.

Rising costs are being shifted from employers and the health plans to
individual employee-beneficiaries. These cost increases are not being
tolerated. The primary cost decision is being made at the time of selecting
the health plan. For the majority of individuals who are relatively healthy,
plans with the lowest premiums will be selected.

The only way the health plan industry can offer products with lower premiums
is to reduce benefits and increase cost-sharing by the beneficiaries. That
is not a major problem for the healthy, but it can result in financial ruin
for those with significant chronic disorders. Less healthy individuals will
have to select the plans with higher premiums to be sure that care will
remain affordable.

Segmentation of the market is inevitable. The healthy will move into the
Spartan plans and the sick will be concentrated in the comprehensive plans
such as Kaiser. With a concentration of high cost patients, comprehensive
plans will be forced to dramatically increase their premiums to the point
that they are unaffordable. This “death spiral” will knock comprehensive
plans out of the market.

Thus, the chronically ill will be forced into the “consumer-driven” plans
and face financial ruin because of the excessive burden of cost-sharing.
Also, some of the healthy, who gambled by selecting low premium plans, will
develop severe acute or chronic problems and likewise face financial ruin.
Unpaid medical bills are continuing to increase as a major cause of personal
bankruptcy.

And what national policies are we adopting to address this disaster? We are
“strengthening” the employer-link by increasing the menu of low premium
plans that will control the employers’ health care costs and will assure the
health plans that they will continue to have a solid market. It matters
little to the health plans that their products are of little value as long
as they continue to receive their portion of the health care dollar. And the
government is seriously considering subsidizing this process through tax
credits which can only result in perpetuation of these cruel policies.

We are spending $1.55 trillion in health care this year. That is more than
enough to provide comprehensive health care services for everyone. We could
achieve this goal merely by adopting a single, publicly administered,
national health insurance program. Yet we continue with these insane
policies because we don’t want the government involved.

But 60% of health care funding is already through the public system. Canada
has a universal system which is 70% publicly funded, and their entire public
and private funding is less than our current government funding alone. Our
government is already deeply involved. Let’s demand that we change public
policies from those that nurture health plans to those that nurture
patients.

The uninsured are back on the national agenda

Los Angeles Times
September 30, 2002
Fewer Have Coverage for Health Care
By Vicki Kemper

Altogether, the number of Americans who had no health coverage for any part
of the year increased… to 41.2 million.

Sen. Edward M. Kennedy (D-Mass.) has signaled his intention to pursue
replacing the system of largely employment-based health insurance with a
government-based system.

Sen. Kennedy:

“The large increase in the already unacceptably high number of the uninsured
should be a wake-up call for Congress and the president. Every American
deserves affordable health care.”

Canadian youth understand

Romanow Commission
Hearing of May 28, 2002
Ottawa

From a summary of the testimony of Kyla Weinman and Laura Wilson, Grade 8
students at Glashan Middle School:

At the outset, they expressed their support for free, universal health care.
Recently, they saw the movie John Q and were appalled to learn that in the
US, many people do not have the money or medical insurance to pay for the
costs of health care.

They noted that some groups want to change our system to mirror that south
of the border, and claimed that those who want to go in this direction are
not the poor. They asked if we want the nightmare of two-tier medicine to
become a reality in Canada.

As youth in Canada, Weinman and Wilson emphasized that the future of health
care is important since it is their future too; it will benefit their aging
parents and it will benefit them as they grow older. Considering a future as
a health care professional, they noted that if Canada adopts a two-tier
system, it would sway their career choice since they want to provide care
for those who need care, not for those who can jump the queue simply by
paying more. They observed that the message Canada’s health care system
sends is that no one is better because they are richer.

In closing, they recalled the words of Tommy Douglas: “I’m telling you that,
unless those of us who believe in Medicare raise our voices in no uncertain
terms, unless we arouse our neighbors and our friends and our communities,
we are sounding the death knell of Medicare in this country – and I, for
one, will not sit idly by and see that happen.”

http://www.youthformedicare.ca/action%20items/action%20-%20kyla%20+%20laura%20presentation%20to%20Romanow.htm

Comment: This testimony is from the y4m (youth for medicare) website. The
opening page is a poster of Canadian youth stating, “We’re young. We’re not
stupid.” The “About Us” page is entitled, “Call to Action for Public
Medicare: Corporate health care sucks!” (They do tend to elect language that
makes their position quite clear.)

It would be great to see a similar movement from our youth in the United
States where our unmet health care needs are much greater than Canada’s.

Their website:
http://www.youthformedicare.ca/

How many uninsured?

USA Today
September 26, 2002
Bridge temporary insurance gaps
By Steven Findlay

Monday, the Census Bureau will release its annual tally of health-insurance
coverage in the USA. Once again we will be reminded of a shameful statistic:
In 2001, some 40 million or so Americans — one in seven — had no health
insurance during the entire year. That includes about 8 million children.

But the new Census numbers aren’t a complete picture of the problem. Many
more Americans have gaps in coverage than this annual report indicates.
That’s because the survey measures (or purports to measure) health-insurance
status during an entire year. But tens of millions of Americans lose their
coverage for some part of the year, sometimes for just a few weeks or
months, a dilemma not reflected in the statistics.

That’s why it’s time to stop using the Census Bureau’s annual report of the
full-year uninsured as the only benchmark of this problem. Instead, the
focus should shift to measures of the number of Americans each year who have
any gap in their coverage.

From 1996 to 1999, between 59 million and 62 million Americans were
uninsured at some point each year, according to a large-scale survey
conducted by the federal Agency for Healthcare Research and Quality. That’s
one in four people under the age of 65 (the age at which Medicare provides
universal coverage). Another Census Bureau analysis, done in 1998, found
that during a three-year period 30% of the population under age 65 can
expect to experience a gap in health insurance.

The change in measuring the uninsured is needed for both symbolic and
concrete reasons. Symbolically, the much larger number may garner more
political attention, as it should. The switch also would send a strong
message that any gap in health-insurance coverage, even of a few weeks, is
dangerous and unacceptable.

Bridging the gaps that millions of Americans have in their coverage would
underscore the fact that health insurance is a necessity, not a luxury. That
would be a good start down the road to universal coverage.

http://www.usatoday.com/usatonline/20020926/4483190s.htm

Comment: Better yet, let’s skip the start and go straight to universal
coverage.

Oregon Health Plan under-funded

The Oregonian
September 25, 2002
Kaiser backs out of Oregon Health Plan
By Joe Rojas-Burke

Kaiser Permanente, Oregon’s largest health maintenance organization, plans
to withdraw from the Oregon Health Plan, a state and federally funded
program for people who are poor or disabled.

The withdrawal effectively ends the state’s attempt to use commercial HMOs
to provide health care to the low-income population. The four largest
commercial plans have dropped tens of thousands of Oregon Health Plan
enrollees during the past two years, saying state reimbursements don’t cover
rising expenses.

Those dropped by Kaiser will remain covered by the Oregon Health Plan. But
they may struggle to find doctors willing to accept the state’s low rate of
payment.

http://www.oregonlive.com/business/oregonian/index.ssf?/xml/story.ssf/html_s
tandard.xsl?/base/business/1032954933321613.xml

Comment: The Oregon Health Plan is an admirable attempt to provide coverage
for low-income individuals, for high-risk individuals, and for those without
employer-based coverage. It has met some of its goals but has fallen short
on others. Overall it has improved the allocation of the very limited health
care funds available for these sectors of the patient population. But one
tradeoff is that services with high cost or low potential of preserving life
are not covered.

Besides rationing, a greater problem persists. These individuals do not have
enough of a political voice to assure that adequate funding of this coverage
would be provided. Commercial HMOs have been losing money in this program,
and direct-to-provider payments are so low that providers may no longer be
willing or even able to participate. Coverage means very little if
participating providers are not readily available.

There are excesses in health care, especially in administration. Reducing
that waste by eliminating the middleman health plans, and redirecting those
funds to health care could assure adequate funding for comprehensive health
care for everyone. Placing everyone in the same risk pool would eliminate
the tendency to under-fund care for low-income or high-risk individuals. And
everyone else would be assured that they would have coverage for benefits
and expenses that are not now covered by their current plans.

Measure 23, the Oregon Comprehensive Health Care Finance Act of 2002, would
do just that. The voters of Oregon will have the opportunity to vote on this
initiative in the November election.

Number Without Health Insurance Climbs 2.5 million Over Previous Estimate

Census Bureau Press Release Disguises Shrinking Coverage

Listen to NPR’s Morning Edition Report (requires Real Player).

The Census Bureau estimate that 41.2 million Americans were uninsured in 2001 actually represents a rise of 2.5 million over their 2000 estimate, not the 1.4 million increase that the Bureau’s press release implies, according to health policy experts at Columbia and Harvard Universities. The discrepancy is due to a new upward revision of the 2000 estimate to correct for previous undercounts of Hispanics and low income Americans that was discovered by the 2000 Census.

The Bureau’s September 30 press release states that the number of uninsured rose from 39.8 million (14.2%) in 2000 to 41.2 million (14.6%) in 2001. Yet last year’s release estimated the number uninsured at 38.7 million (14.0%). The 1.1 million discrepancy in the 2000 estimates is buried in a technical appendix to the Census Bureau’s report, and is not even mentioned in the Bureau’s press release announcing the 2001 findings.

“The Bush administration is trying to bury bad domestic news. Last year they announced that 38.7 million were uninsured. This year their figure is 2.5 million higher, but by sleight of hand they try to make almost half of the increase disappear.” Said Dr. David U. Himmelstein, Associate Professor of Medicine at Harvard. He continued: “Despite the economic boom of the 1990s and massive expansions of Medicaid and the CHIP program, we’ve been losing ground on health insurance. Between 1991 and 2001, the number of uninsured rose by 8.5 million, and by 18 million since 1980. And though we won’t have the exact figures until next year, everyone knows that things are already much worse than today’s report indicates. Health costs are soaring, and additional millions have lost job-based coverage this year. Only national health insurance can save our failing health care system.”

Dr. Olveen Carrasquillo, Assistant Professor of Medicine at Columbia University noted: “Since 1992, the number of Hispanics without coverage has increased by 4 million, a 47% increase. Latinos, who make up 13% of the U.S. population, accounted for 64% of the increase in the uninsured between 2000 and 2001. While the Bush administration pays lip service to reaching out to Hispanic voters, its policies are denying life-saving medical care to millions of Hispanics.”

Note: Last year’s Census Bureau press release and estimate on the uninsured is available at: www.Census.gov/Press-Release/www/2001/cb01-162.html

####

Physicians for a National Health Program is a membership organization that advocates for universal health care under a single-payer national health program. For commentary on state increases in the number of uninsured, call (312) 782-6006 for a local spokesperson.

Dr. Olveen Carrasquillo may be reached at (212) 305-7298 or (212) 851-5358.

Stifling technological innovation?

Reuters Health
September 23, 2002
Millionaires Lining Up to Buy Personal Gene Maps
By Richard Woodman

A service to map a person’s entire genetic code is being offered by
America’s genome entrepreneur Craig Venter, according to the Sunday Times.

The newspaper said that for 400,000 (US$621,500), a person would get details
of their entire genetic code within 1 week.

Venter is said to have already signed up several millionaires, though he has
declined to name them.

According to the report, 25 million ($38.9 million) will be spent on the new
facility, which will offer the service starting later this year.

But other researchers, already upset by Venter’s commercial approach to the
Human Genome Project, are skeptical.

Dr. Tim Hubbard, head of human genome analysis at the Sanger Institute in
Cambridge, one of the laboratories involved in the Human Genome Project,
said knowing someone’s genome was not the same as understanding it.

“We know very little about the link between differences in genes and ill
health. Until we do, mapping individual genomes will be like the Russians
sending tourists into space. It is fun for those who can afford it, but it
is just a good gimmick.”

http://abcnews.go.com/wire/Living/reuters20020923_392.html

Comment: A frequent criticism of universal health care programs is that
they stifle technological innovations. Research and development costs, under
a publicly funded system, would be recovered, along with a fair profit, only
if the technological advances and new pharmaceutical products provided value
for the health care dollar.

But many innovations today such as spiral CT scans used as “virtual physical
examinations” or the development of high-priced copy-cat drugs are not
providing value considering their costs. In fact, the impact of these new
innovations may be detrimental and even more costly, producing a negative
value. Craig Venter’s abuse of the Human Genome Project, partly funded
directly and indirectly with public dollars, is a terrible waste of
resources that could be put to much better use.

More investment in research on the human genome is needed. But the mission
of that research must be for the public good rather than primarily as a
means to divert large amounts of health care dollars to passive investors.

At our current health care spending of over $1.5 trillion, more than enough
funds would be available to support a robust research program. But let’s do
it through the National Institutes of Health. And then let’s demand that our
public investment is used for the public good. Private firms can prosper by
producing technological and pharmaceutical products, but they should prosper
only when they provide adequate health care value.