PNHP

AMA supports progressive tax policies for health care

AMA supports progressive tax policies for health care

AMA meeting: AMA clarifies plan on tax credits for insurance

By Doug Trapp
American Medical News
July 7, 2008

Existing AMA policy, first approved a decade ago, calls for ending employees’ federal income tax exemption for work-based coverage. That should happen, however, only after establishing a system of tax credits to help people buy health insurance. Related AMA policy also calls for… an individual insurance mandate for those earning more than 500% of the federal poverty level, and subsidies for medically high-risk people.

AMA policy adopted at the (House of Delegates) meeting further specifies that once tax credits are in place, employee exemptions for health insurance spending should end only for federal income taxes — not for state or federal payroll taxes, which include Medicare, Social Security and unemployment taxes. (T)he exemption for payroll taxes… would disproportionately affect lower-income people and raise employers’ payroll taxes, and would not provide additional revenue for health insurance tax credits.

Richard Warner, MD, a Kansas psychiatrist, offered an amendment to maintain tax-free HSA contributions after insurance tax credits are in place, but the house did not adopt it.

Delegates also clarified AMA policy on the tax deductibility of health insurance spending. Previous policy had called for deductibility of out-of-pocket medical expenses and insurance premiums, but the house rescinded it in favor of the tax credit plan. AMA policy still envisions people with lower incomes having more generous tax credits and easier access to them than wealthier people.

David McKalip, MD, a neurosurgeon in St. Petersburg, Fla., offered an amendment to give Americans at all income levels tax credits for purchasing health insurance. He said the AMA policy represents a massive transfer of wealth that would discourage wealthier Americans from having health insurance by ending their tax incentives for buying it. His proposal was rejected.

http://www.ama-assn.org/amednews/2008/07/07/prsk0707.htm

Comment:

By Don McCanne, MD

From a policy perspective, this is really great news. The AMA already is on record for supporting progressive financing of our health care system through the use of refundable, advanceable, inversely-income-indexed tax credits to purchase private health plans. The current additional actions of the AMA House of Delegates even more explicitly support the concept of progressive financing of health care, based on ability to pay.

Health savings accounts (HSAs) are a regressive method of financing health care because they provide a greater tax deduction to higher income individuals. The AMA proposal would end this unfair policy by no longer allowing the deduction of HSA contributions from taxable income. An attempt to endorse the continuation of tax-free HSA contributions was rejected.

AMA policies would tend to shift coverage from employer-sponsored plans to the individual market. To encourage this shift, some policymakers recommend eliminating the deductibility of employer-sponsored coverage, and making premiums and out-of-pocket expenses deductible for the individual. The AMA recognizes that this would perpetuate unfair regressive tax policies. Instead, the AMA recommends not allowing the deductibility of medical expenses or premiums, but instead providing tax credits that are inversely proportional to each individual’s income. There could not be a more explicit support of shifting from regressive to progressive tax policies to fund health care.

The AMA also supports a mandate to purchase insurance for individuals with incomes over 500 percent of the federal poverty level. This is another policy that explicitly acknowledges that the wealthy have a responsibility to contribute to the pooling of funds for health care for everyone.

The AMA also supports tax subsidies for high-risk people, yet another acknowledgment that financing of major health care costs must be through progressive tax policies.

Perhaps the most exciting news of all is the action taken on an amendment offered in protest to the “massive transfer of wealth” that would take place by ending the regressive tax incentives to purchase private insurance. (Technically, the AMA proposal would end the “massive transfer of wealth to the wealthy” through health plan deductibility, and replace it with a transfer to lower-income individuals who need help paying for health care.) The AMA rejected this amendment, seeing through the mean-spirited “massive transfer of wealth” rhetoric. AMA members are first and foremost physicians who really do care about their patients.

In relying on private health plans to provide coverage, the AMA still has a major hurdle before reaching a model that actually would work. They do support greater regulation of the insurance plans, but through a robust market of private plan choices. Regulations are required to make the plans do their job of providing us with affordable access to health care, whereas markets function to provide us with price-competitive insurance products that keep prices down by preventing us from having affordable access to health care that we need. We can avoid that perpetual push-pull by replacing the private plans with a single risk pool, funded through progressive tax policies, and administered by our own public agency.

The AMA is getting closer. If they would just knock down this private-plan hurdle, the AMA could lead the way.

Presbyterian Church USA votes to support single payer healthcare

Last week there was a major victory at the Presbyterian Church USA General Assembly where many hundreds of commissioners from across the country met in San Jose to discuss and set church policy on a broad range of faith and justice issues. They voted 377 to 250 with 12 abstentions to support publicly financed privately delivered single payer health care and appropriated $25,000 to their educational program to teach on this issue. Presbyterians in Pittsburgh and David Bos from Kentucky took the initiative that made this astounding success possible.

Study: Most Doctors Favor National Insurance

Student hopes findings will sway CMA to avidly support national healthcare

By Parker Duncan
Southern California Physician
06/1/2008
Med Student Views

For advocates of true healthcare reform, spring is in full bloom. April brought two important surveys and a high-profile investigative television report, all of which were supportive of national health insurance such as a “single-payer” system. California health professional students continue to add even more voices to the chorus. Will the California Medical Association join in?

In a study printed in the April Annals of Internal Medicine, Indiana University School of Medicine researcher Aaron Carroll found that 59 percent of physicians–and a majority across almost every specialty–favor “government legislation to establish national health insurance.”

Two weeks later, the PBS Frontline special “Sick Around the World” focused on lessons that the United States can learn from the national healthcare systems of five other democracies. And a late-April Field Institute poll reported that the proportion of Californians preferring to receive healthcare coverage “through the government” rose by nine percentage points since 2006, while preference for “individual responsibility” dropped six points.

These “April showers” of information are a clarion call for true healthcare reform that fulfills the five guiding principles defined in the Institute of Medicine’s 2004 report, Insuring America’s Health: Principles and Recommendations. The five principles are:

Universality–Everyone in, nobody out, where “everyone” means everybody, as compared to recent state initiatives, where universal healthcare will never be achieved by design.

Continuity–Care that is life-long, automatic and guaranteed.

Affordability–Care that is accessible to families and individuals.

Sustainability–A system of care to which everyone contributes, and that simplifies billing, regulations and underwriting requirements.

High quality–Care that is patient-centered and evidence-based, with the goal of improving the population’s health.

California medical students get it. In January 2006, more than 125 of us gathered in Sacramento for the first-ever Lobby Day created entirely by medical students in support of state Sen. Sheila Kuehl’s SB 840, the state’s only reform effort that upholds the IOM’s criteria. In 2007, we brought more than 200 students. This January, we grew even larger and broader. A coalition of more than 350 health professional students left our classrooms and clinical responsibilities to amass in Sacramento, holding more than 100 legislative visits that secured four co-authorships.

And not just health professional students, but specifically CMA Medical Student Section members get it. Many of the students involved in planning and attending Lobby Day have held CMA-MSS leadership roles both on their campuses and in the statewide organization. In 2006, the CMA-MSS Congress endorsed a single-payer approach to health insurance reform. And this month in Chicago, CMA-MSS leaders introduced legislation calling upon the American Medical Association to endorse the IOM guiding principles.

Will CMA redefine its value system to unambiguously embrace what physicians want, what its students have been advocating for more than two years, and what patients are literally dying for? Such a redefinition would value healthcare as a social good, rather than as another widget produced in response to the market.

What is most puzzling is the CMA’s lack of a clear endorsement of national health insurance, even while it expends a major part of its advocacy contesting violations by companies thriving under the current system. Not a CMA Alert arrives without the next twisted and horrid tale of such follies, along with CMA’s save-the-day efforts to protect physicians. For example, the April 28 Alert’s lead article, “United Healthcare Cutting Physician Fees Without Notice,” is followed by an update on the latest racketeering lawsuit against Blue Cross/Blue Shield.

Ultimately, the imperative of true, universal healthcare transcends our 59-percent physician support, and even public support. Huge social and environmental issues loom on the horizon, and creating a universal healthcare system is the minimum preparation we can make for the potential impact on health that will result from such environmental eventualities as polar ice-cap melting.

Healthcare reform consistent with the IOM is inevitable and it is near at hand. My optimism springs from the belief that we have almost fulfilled Winston Churchill’s quip that “Americans will always do the right thing–after they’ve tried everything else.” Along with hundreds of other medical students and other CMA-MSS members, I invite the CMA for a stroll through the resplendent fields of change.

Senate advances plot to privatize Medicare

Medicare Advantage Organizations: Actual Expenses and Profits Compared to Projections for 2005

GAO
June 24, 2008
On average, MA organizations’ self-reported actual medical expenditures as a percentage of revenue were lower in 2005 than they had projected. MA organizations, on average, reported spending 85.7 percent of total revenue on medical expenses in 2005, but had projected medical expenditures of 90.2 percent of total revenue. Because organizations spent less revenue on medical expenses than projected, they earned higher average profits than projected. On average, MA organizations’ self-reported actual profit margin was 5.1 percent of total revenue, which is approximately $1.14 billion more in profits in 2005 than MA organizations projected.
http://www.gao.gov/new.items/d08827r.pdf

And…

Medicare Cloture Narrowly Fails

By Drew Armstrong
CQ Politics
June 26, 2008
It now looks certain that doctors will take a deep cut to their Medicare payment rates next week, after the Senate failed to move forward on a take-it-or-leave-it Medicare bill offered up by Democrats.
The White House reiterated its veto threat against the bill on Thursday, likely making moot the narrow victory that seemed possible for Democrats. The administration opposes a provision that would partially offset the cost of the bill by cutting some bonus payments to private Medicare Advantage plans in areas with teaching hospitals. It also disagreed with a provision to limit a subset of the plans known as “private fee for service,” saying the bill would “reduce access, benefits, and choices for many of the approximately 2.25 million beneficiaries who have chosen to enroll in” those plans.
The Medicare Advantage plans are paid at a higher rate than traditional Medicare, and Democrats have long argued that the private plans’ rates should be cut.
The Bush administration and many Republicans argue that the plans inject private competition into the market and will eventually lower costs.
The House passed the measure two days ago, 355-59, in a vote comfortably more than the two-thirds majority that would be needed to override a presidential veto.
http://www.cqpolitics.com/wmspage.cfm?docID=news-000002907388&parm1=1&cpage=1

The political defeat of the measure to prevent Medicare pay cuts for physicians was not partisan. Enough Republicans joined Democrats in the House to form a veto-proof majority in support of the legislation. Though many Republicans also joined the Democrats in the Senate, they came up one vote short on cloture. Sens. Obama and Clinton interrupted campaign activities to vote, but Sen. McCain was a no-show.
This was a victory for conservative/libertarian ideologues who wish to destroy the traditional Medicare program and replace it with private health plans. Their first step was to use taxpayer funds to overpay private Medicare Advantage plans so that patients would be attracted by the greater benefits that could be offered (benefits that in all fairness should be offered as well to those remaining in the traditional program). The next step is to reduce compensation in the traditional Medicare program so that physicians will bail out. Fee reductions of about 40 percent are scheduled over the next couple of years, which should accelerate the physician exodus. That would convert Medicare into an underfunded Medicaid-type welfare program, with patients fleeing to the private options.
The eventual surprise that Medicare Advantage beneficiaries are not anticipating is that it will be converted into a defined contribution program with the costs of health care inflation being shifted to the patients’ portion of the Medicare Advantage premium and to other out-of-pocket cost sharing.
Fortunately, many Republicans do support the social solidarity represented by Medicare. They are offended by the efforts to waste taxpayer funds on the excesses of private insurers in a nefarious plot to destroy the best health care financing program we have (though it needs further improvement). Joining with the Democrats, these Republicans will surely do the right thing when they return from their recess. Sen. McCain will also have another opportunity to dispel the claim that he offers us only four more years of Bush policies.

Senate advances plot to privatize Medicare

Medicare Advantage Organizations: Actual Expenses and Profits Compared to Projections for 2005

GAO
June 24, 2008

On average, MA organizations’ self-reported actual medical expenditures as a percentage of revenue were lower in 2005 than they had projected. MA organizations, on average, reported spending 85.7 percent of total revenue on medical expenses in 2005, but had projected medical expenditures of 90.2 percent of total revenue. Because organizations spent less revenue on medical expenses than projected, they earned higher average profits than projected. On average, MA organizations’ self-reported actual profit margin was 5.1 percent of total revenue, which is approximately $1.14 billion more in profits in 2005 than MA organizations projected.

http://www.gao.gov/new.items/d08827r.pdf

And…

Medicare Cloture Narrowly Fails

By Drew Armstrong
CQ Politics
June 26, 2008

It now looks certain that doctors will take a deep cut to their Medicare payment rates next week, after the Senate failed to move forward on a take-it-or-leave-it Medicare bill offered up by Democrats.

The White House reiterated its veto threat against the bill on Thursday, likely making moot the narrow victory that seemed possible for Democrats. The administration opposes a provision that would partially offset the cost of the bill by cutting some bonus payments to private Medicare Advantage plans in areas with teaching hospitals. It also disagreed with a provision to limit a subset of the plans known as “private fee for service,” saying the bill would “reduce access, benefits, and choices for many of the approximately 2.25 million beneficiaries who have chosen to enroll in” those plans.

The Medicare Advantage plans are paid at a higher rate than traditional Medicare, and Democrats have long argued that the private plans’ rates should be cut.

The Bush administration and many Republicans argue that the plans inject private competition into the market and will eventually lower costs.

The House passed the measure two days ago, 355-59, in a vote comfortably more than the two-thirds majority that would be needed to override a presidential veto.

http://www.cqpolitics.com/wmspage.cfm?docID=news-000002907388&parm1=1&cpage=1

Comment:

By Don McCanne, MD

The political defeat of the measure to prevent Medicare pay cuts for physicians was not partisan. Enough Republicans joined Democrats in the House to form a veto-proof majority in support of the legislation. Though many Republicans also joined the Democrats in the Senate, they came up one vote short on cloture. Sens. Obama and Clinton interrupted campaign activities to vote, but Sen. McCain was a no-show.

This was a victory for conservative/libertarian ideologues who wish to destroy the traditional Medicare program and replace it with private health plans. Their first step was to use taxpayer funds to overpay private Medicare Advantage plans so that patients would be attracted by the greater benefits that could be offered (benefits that in all fairness should be offered as well to those remaining in the traditional program). The next step is to reduce compensation in the traditional Medicare program so that physicians will bail out. Fee reductions of about 40 percent are scheduled over the next couple of years, which should accelerate the physician exodus. That would convert Medicare into an underfunded Medicaid-type welfare program, with patients fleeing to the private options.

The eventual surprise that Medicare Advantage beneficiaries are not anticipating is that it will be converted into a defined contribution program with the costs of health care inflation being shifted to the patients’ portion of the Medicare Advantage premium and to other out-of-pocket cost sharing.

Fortunately, many Republicans do support the social solidarity represented by Medicare. They are offended by the efforts to waste taxpayer funds on the excesses of private insurers in a nefarious plot to destroy the best health care financing program we have (though it needs further improvement). Joining with the Democrats, these Republicans will surely do the right thing when they return from their recess. Sen. McCain will also have another opportunity to dispel the claim that he offers us only four more years of Bush policies.

The battle to save Medicare

Saul Friedman
Gray Matters
Newsday
June 26, 2008

Reader Jack Wajda, 69, of Orlando, a retired AT&T executive and financial planner, identifies the single greatest problem with the American health-care system as well as anyone. He writes: “To allow private for-profit insurance companies to decide whether and what type of care we receive is incomprehensible to me.”

If you’ve been reading my columns and mail in reaction to what I’ve written, that private insurers have the power to virtually run American health care is also incomprehensible to most doctors, nurses, technicians, as well as patients.

Don’t get me wrong. I have auto, homeowners and life insurance. The risk pools for these coverages are fairly predictable and we can largely depend on the insurance protection. But consider what happened on the Gulf coasts and even in parts of Long Island after recent hurricanes. Insurance was canceled or premiums raised sky high because of the slim possibility of another storm.

But one’s health should not be held hostage to the profit motive. Health is too important to be left to the insurance business. It is not like a car or a roof that can be replaced.

Yet that is how for-profit health insurance works. As long as you’re young and reasonably healthy, insurance companies are glad to take your money and cover your bumps, bruises and routine doctor visits. But if you’re really ill and your costs run into the thousands, your insurer will have second thoughts about your coverage. And if you’re elderly and more likely to suffer costly health problems, the risk pool suddenly becomes too risky for the profit-seeking health insurers.

Those costs are why the Republicans, who seek to replace Medicare with private insurance companies, took the first step toward that in 1995, with the assent of the Clinton administration, when Newt Gingrich’s Congress required Medicare to bring in private so-called Medicare HMOs. Gingrich, you recall, promised insurers that Medicare would “wither on the vine.” The HMOs bugged out on Medicare because they weren’t making sufficient profits. But they were replaced by “Medicare Plus Choice.”

Now, as Wajda correctly writes, taxpayers pay the private Medicare Advantage plans at least $9,000 a year more per patient than for traditional Medicare, with salespeople getting commissions. On top of that, the prescription benefit, Part D, has also been given to the insurance companies, which are earning high profits.

Medicare Advantage and Part D have been so confusing and corrupted by greedy sales practices and deception that even this administration has taken measures to crack down. But more important, the privatization of Medicare has come at great cost to the principles and the budget of our most popular public health-insurance program. As Judith Stein, of the Center for Medicare Advocacy, writes, private insurance is in danger of killing Medicare.

So will someone tell me why even Medicare’s well-wishers, including Sens. Barack Obama and Hillary Clinton, continue to look to the private insurers to strengthen the nation’s health-care system and cover the 47 million uninsured Americans? Both would subsidize the coverage for millions of Americans, but most of the insurance would be private. And many would not be covered. Sen. John McCain, who would slash spending for public health insurance, except for federal employees such as himself, would provide tax credits to purchase private insurance.

As columnist (and my former Newsday colleague) Marie Cocco writes, these proposals would not bring everyone into the system, and without universal coverage, the risk pool is bound to fail. Besides, patients and physicians would still be at the mercy of a profit-seeking business, with large administrative costs, bureaucrats checking and second-guessing your coverage, executive salaries, salespeople’s commissions and stockholders to satisfy.

Stein and other Medicare advocates have been lobbying to strengthen the program by canceling a potentially devastating 10 percent slash in physicians’ fee and easing the assets test to permit more of the near poor to take advantage of low-income programs. And Democratic lawmakers would pay for these changes by cutting the excessive payments to private Medicare Advantage plans.

But Mike Leavitt, the Secretary of Health and Human Services, who has been on the road telling audiences and reporters that Medicare is in financial trouble, has told Democrats that President George W. Bush will veto any bill that touches the fund for the private insurers.

As Democrats seek a Medicare bill that will pass, AARP has launched a nationwide advertising campaign to “Keep Medicare Fair.” AARP’s Andrew Nannis told me the organization favors the bill’s proposals to loosen the assets tests and cancel the physician cuts, without raising Medicare premiums. He added that AARP favors cutting the subsidies to private plans, but it’s not clear how hard their lobbyists are pushing for it. AARP’s insurer, UnitedHealthcare, is lobbying hard to retain the subsidies, which earns AARP $700 million a year in royalties.

Traditional Medicare is still the nation’s most popular health insurance, even among the young. Why not save the system with Medicare for all? Rep. John Conyers’ bill, HR 676, would cover every person for all health-care issues, and eliminate the expense of dozens of other programs, such as Medicaid, and the high overhead and profits of the private-insurance industry. The bill has 90 co-sponsors, and the support of organized labor, nurses and thousands of doctors. Take a look at the bill at thomas.loc.gov.

http://www.newsday.com/news/columnists/ny-bzsaul0627,0,4451877.column

Insured experience a larger relative increase in access problems

Falling Behind: Americans' Access to Medical Care Deteriorates, 2003-2007

By Peter J. Cunningham and Laurie E. Felland
Center for Studying Health System Change (HSC)
June 2008

The number and proportion of Americans reporting going without or delaying needed medical care increased sharply between 2003 and 2007, according to findings from the Center for Studying Health System Change’s (HSC) nationally representative 2007 Health Tracking Household Survey. One in five Americans — 59 million people — reported not getting or delaying needed medical care in 2007, up from one in seven — 36 million people — in 2003.

While access deteriorated for both insured and uninsured people, insured people experienced a larger relative increase in access problems compared with uninsured people. Moreover, access declined more for people in fair or poor health than for healthier people. In addition, unmet medical needs increased for low-income children, reversing earlier trends and widening the access gap with higher-income children. People reporting access problems increasingly cited cost as an obstacle to needed care, along with rising rates of health plan and health system barriers.

While cost continued to be the overwhelming concern among uninsured people (more than 90% of uninsured people reported cost as a barrier across all three surveys), the increase in cost barriers occurred mostly among insured people. Higher patient cost sharing — people facing higher deductibles and other increased out-of-pocket expenses for medical services — likely is driving growing cost concerns among insured people.

The health plan-related barriers that people increasingly cited were that their health plan would not pay for treatment (9.2 percentage point increase), followed by the doctor or hospital would not accept their insurance (4.5 percentage point increase). The return of health plan prior-authorization requirements for certain services may be a contributing factor. Also, rising insurance deductibles or coinsurance that cause people to be responsible for much or all of a medical bill may contribute to some people reporting that their health plan would not pay for the treatment. The increase in people reporting that their doctor would not accept their insurance may mean more doctors are opting out of private insurance networks or not accepting new Medicare or Medicaid patients.

http://www.hschange.org/CONTENT/993/

And…

Increasing Number of U.S. Residents Delay, Forgo Needed Health Care Because of Cost Concerns, According to (HSC) Report

Kaiser Daily Health Policy Report
June 26, 2008

Karen Ignagni, CEO of America’s Health Insurance Plans, said that lawmakers must address a number of issues — such as differences in quality of care across the nation and the high costs of surgeries, medical imaging services and specialty medications — to make medical care more affordable (Rubenstein, Wall Street Journal, 6/26).

http://www.kaisernetwork.org/Daily_reports/rep_hpolicy.cfm#52980

Comment:

By Don McCanne, MD

Access to health care in the United States is bad and getting worse. Particularly shocking are some of the factors that are associated with impaired access: increasing rates of uninsurance, deterioration in the financial protection afforded those who are insured, rising rates of health plan barriers, children being in families with low incomes (reversing prior gains), excessive increases in health care costs, and, most shocking of all, actually having a need for health care, insured or not.

Other contributors to impaired access include the growing shortage of primary care professionals, evolving entrepreneurial trends with a decline in the provision of charity services, and the increasing constraints in the capacities of community health centers and other safety-net institutions.

The fastest growing cause of impaired access is the increase in health plan-related barriers. So what is the response of the insurance industry? “Lawmakers must address” the issues. If the insurance industry is making things worse, and they want to turn the problems over to lawmakers, then we should accept their suggestion. Why continue to pay them hundreds of billions of dollars when their insurance product innovations are no longer ensuring affordable access for those of us with significant health care needs?

In an HSC press release, Gail Shearer, director of health policy analysis at Consumers Union, stated, “This study is yet another wake-up call to policymakers that our health care system is failing to meet the needs of even insured consumers in America. Health care reform is not just about decreasing the numbers of uninsured people. It is about transforming the system into one that consistently provides appropriate quality care without unfair financial burdens.”

Single payer, anyone?

International Health Systems for Single Payer Advocates

By Dr. Ida Hellander
PNHP Executive Director

Health care systems in the Organization for Economic Cooperation and Development (OECD) countries primarily reflect three types of programs:

1. In a single-payer national health insurance system, as demonstrated by Canada, Denmark, Norway, Australia, Taiwan and Sweden, health insurance is publicly administered and most physicians are in private practice. U.S. Medicare would be a single payer insurance system if it applied to everyone in the U.S.

2. Great Britain and Spain are among the OECD countries with national health services, in which salaried physicians predominate and hospitals are publicly owned and operated. The Department of Veteran’s Affairs would be a U.S. single payer national health service system if it applied to everyone in the U.S.

3. Highly regulated, universal, multi-payer health insurance systems are illustrated by countries like Germany and France, which have universal health insurance via non-profit “sickness funds” or “social insurance funds”. They also have a market for supplementary private insurance, or “gap” coverage, but this accounts for less than 5 percent of health expenditures in most nations.

Sickness or social insurance funds do not operate like insurance companies in the U.S.; they don’t market, cherry pick, set premiums or rates paid to providers, determine benefits, earn profits or have investors, etc. In most countries, sickness funds pay physicians and hospitals uniform rates that are negotiated annually (also known as an “all-payer” system). Princeton economist Uwe Reinhardt calls Switzerland’s “sickness funds” quasi-governmental agencies**

There is no model similar to sickness funds *** operating in the U.S., although they are often confused with the Federal Employee Health Benefit Program (FEHBP), which is simply a group of for-profit private insurance plans with varying benefits, rules, regulations, providers, etc. The 1993 Clinton health plan was an attempt to regulate private insurance companies in the U.S. to behave more like sickness funds, but the insurance industry defeated it.

Bottom line: The most important point for single payer advocates is that every country with universal coverage has a non-profit insurance system. No country uses for-profit, investor-owned insurance companies such as we have in the U.S. (although they do have a small role in selling “gap” coverage).

Notes:

* The three basic models are general outlines, and there are many examples of “mixed models” (e.g. although Sweden has national health insurance, the hospitals are owned by county government, a feature more common to countries with a national health service).

** Many countries are tinkering with how sickness funds operate (e.g. Germany). The most extreme change is in the Netherlands, which since 2006 has allowed the non-profit regional sickness funds to become for-profit insurance companies, and new insurance companies to form, in the hope that “competition” would control costs. After just one year of experience, the country has experienced 1) a wave of anti-competitive mergers of the insurers 2) emergence of health plans that “cherry pick” the young and healthy and 3) loss of universal coverage and the emergence of 250,000 residents who are uninsured and 4) another 250,000 residents who are behind on their insurance payments. All of the positive data from the Netherlands (on costs, infant mortality, quality, etc) is based on the system pre-2006 (personal communication, Hans Maarse).

*** In the film “Sick around the World” five nation’s health systems are shown. The U.K. is an example of a single payer national health service. Taiwan is an example of a single payer national health insurance. Germany, Japan, and Switzerland use multiple “sickness funds” that are non-profit and pay uniform rates to providers (“all-payer”)

The OECD regularly publishes a CD-ROM with 10+ years of comparative data for those interested in pursuing further research. It is available on the OECD website at www.oecd.org

Comparative studies of several nations’ systems by Gerard Anderson at John Hopkins are on the Commonwealth Fund web site, www.commonwealthfund.org

Strong support for universal risk pool

Kaiser Health Tracking Poll: Election 2008

Kaiser Family Foundation
June 2008

As a result of recent changes in the economy, have you and your family experienced any of the following problems, or not? Was this a serious problem, or not?

Percent of the public saying each was a “serious problem:”
43% – Problems paying for gas
27% – Problems getting a good-paying job or raise in pay
25% – Problems paying for health care and health insurance
19% – Problems paying for food
16% – Problems with credit card debt or other personal debt
15% – Losing money in the stock market
14% – Problems paying your rent or mortgage

Which ONE of the following health care issues would you most like to hear the presidential candidates talk about?

51% – Making health care and health insurance more affordable
22% – Expanding health insurance coverage for the uninsured
10% – Improving the quality of care and reducing medical errors
7% – Reducing the total amount the country spends on health care
4% – Reducing spending on government programs like Medicare/Medicaid

Do you think that the cost of health care is something the president and Congress can do a lot about, do a little about, or is that mostly beyond their control?

62% – A lot
21% – A little
13% – Beyond their control
3% – Don’t know

The presidential candidates have proposed different approaches to improving the health care system in the U.S. Which of the following comes closest to your view?

56% – The main goal of these efforts should be to make sure that EVERYONE is covered by health insurance
41% – The main goal of these efforts should be to make health insurance more available and affordable in the private marketplace, even if everyone doesn’t get covered

When thinking about health insurance coverage in this country, which of the following comes closer to your view?

59% – We need to get everyone into the same insurance pool so we can spread the costs of sick and healthy people over the whole population
32% – Healthier people should not be asked to pay more to subsidize sicker people by being in the same insurance pool with them
10% – Don’t know/Refused

http://www.kff.org/kaiserpolls/h08_posr062508pkg.cfm

Comment:

By Don McCanne, MD

Paying for health care and health insurance is already a serious problem for one-fourth of us. That is greater than the percent of individuals having serious problems paying for food and housing and paying off credit cards and other personal debt.

The strongest support is for making health care and health insurance affordable. The public also supports covering everyone with insurance, although that support is much weaker amongst Republicans (11%).

A strong majority believes that the president and Congress can do a lot about the cost of health care, suggesting that there is strong support for a major government role in health care reform.

The most reassuring finding in this poll is that almost twice as many people believe that “we need to get everyone into the same insurance pool so we can spread the costs of sick and healthy people over the whole population” as do those who believe that the healthy “should not be asked to pay more to subsidize sicker people by being in the same insurance pool with them.”

And look at the breakdown of the support for a single risk pool covering everyone: 74% of Democrats, 57% of Independents, and 39% of Republicans. Imagine a coalition of the Democrats, a strong majority of Independents, and two-fifths of the Republicans. That should be more than enough to refute the notion that a single payer national health program is not politically feasible. The public already supports the policy; we just need to get them to understand the “single payer” label, or come up with a new one.

Fein Calls For Taking Profit Out Of Health

by Melinda Tuhus
New Haven Independent
June 24, 2008 1:35 PM

This man wants to get rid of co-pays and deductibles for health insurance, which he calls “remarkably crude ways of controlling demand.” He has a better idea — health insurance for all in a system that allows private coverage with public funding.

Dr. Oliver Fein is taking the reins at Physicians for a National Health Program, a 20-year-old organization of more than 15,000 doctors who support a single-payer plan for all, similar to Medicare for those over 65.


Melinda Tuhus Photo
PNHP President-Elect Dr. Oliver Fein

He told about 30 doctors and medical students over dinner Monday night at Mory’s (that “fabled Yale drinking club,” as one diner described it) that under the current system, the U.S. ranks highest in the number of preventable deaths among 19 developed nations. That’s because 45 million Americans are uninsured, and more than 50 million are underinsured.

One of those attending was Yale historian Jennifer Klein, who wrote a book about what she called “our screwed-up health care system.” She said that back in the 1930s people were organizing health care as a community benefit; it wasn’t a profit-based system. “It had nothing to do with insurance companies, and it had very little to do with employers,” she said. Click here to hear a two-minute lesson in how the system evolved to its current state.

Responding to those flaws, Fein, a practicing physician and professor of public health at Weill Cornell Medical College in New York, said health coverage must be universal, covering everyone. As for undocumented immigrants, he proposed the wording of any new health insurance law should stipulate that “residents” are covered, but then lawmakers should decide what length of residency is required to be eligible for coverage.

Fein enumerated other requirements of a new paradigm of health insurance. “It must be comprehensive. Would there be any exclusions? Yeah, probably, you know, tummy tucks, botox for wrinkles. I might even exclude a private room in the hospital unless medically indicated,” such as if a patient has a roommate with tuberculosis.

“It must be tier-free. Now we have one tier for the elderly, another tier for the poor, another tier for those who are employed, another for those who are uninsured. We really need to think of a single tier of care.”

That’s when he proposed eliminating co-pays and deductibles, “because what they do is cut demand for needed services equal to the amount they cut for unneeded services.” Another tenet of a tier-free system, he said, is that private insurance can supplement, but not duplicate, public coverage.

He said public funding should replace the “regressive” funding of premium-based financing for health insurance. “Right now, the president of a company usually pays the same premium as the secretary in the company. Are their incomes equal? Absolutely not.”

And finally, the new system must have low administrative costs, for which the U.S. has to look no further than its own health care program for elders. “Medicare has an administrative cost of three percent,” he pointed out, “whereas the average commercial insurance in this country has an overhead and profit of roughly 19 to 20 percent.” For some insurers, that number goes up to 30 percent of medical costs.

This reporter was seated next to Veronica Marer, a Canadian-born solo private practitioner in Connecticut. She said with her roots in Canada (and relatives also in France), she’s learned a lot about the single payer health systems in those countries, which she believes are better for more people than the U.S. system. But, she added, “Of course it’s not perfect; there’s rationing of care and waiting for non-emergency procedures.” But she supports single payer not only because it covers more people, but because it’s much more cost-effective. She said with such a system in place, she could do with one fewer of her 2.5 employees. “Not that I want to get rid of anyone,” she hastened to add. “I love my employees.”

One goal of the gathering was to resuscitate the dormant state chapter of PNHP that had existed in the 1990s. John Battista, a psychiatrist and one of the leaders of that chapter, recounted a brief history of their efforts, from “giving talks at churches and all that,” to drafting a single payer bill in 1999; to do that PNHP spun off the Connecticut Coalition for Universal Health Care. The bill failed to pass in the General Assembly, for which Battista blamed the influence of the insurance industry on key lawmakers.

When those present introduced themselves, Michael Connair, an orthopedic surgeon in private practice and an associate clinical professor at the Yale School of Medicine, said he hoped the organization would “modify its spiel slightly to have more appeal.”

Asked to elaborate after the event, Connair replied, “I think there is a knee-jerk prejudice against a single payer system — rightly so, looking at Medicaid or the Canadian system or the deteriorating aspects of the Medicare system. So to use that phrase unnecessarily alienates people. I think the message this organization is trying to get across is that we should have universal health care sponsored by the government, controlled by the government, with the elimination of skimming by the insurance companies and the unnecessary administrative barriers that make life difficult for doctors and patients. I think this organization wants an enlightened European system.

“The Universal Health Care Foundation of Connecticut has a similar message,” Connair continued, “but it seems to be a little more readily accepted — universal health care for all. I think they should unite with the foundation which has the support of providers, consumers and businesses. It would be a shame to duplicate efforts — I think a common presentation of ideas would benefit both. PR [public relations] is important here. You’ve gotta get your foot in the door before people will listen, and you don’t want to turn them off before they’ve heard your message. Americans probably wouldn’t tolerate the Canadian or British systems, but would probably accept some of the European models.” (Disclosure: The Universal Health Care Foundation of Connecticut grants money to the Online Journalism Project, which publishes this website.)

Fein said he hoped one positive outcome of the nation’s economic downturn would be that more people would start thinking about taking the profit out of health care. He also said PNHP is supporting House bill 676 in Congress that would create a single payer system.

A contingent of Connecticut Green Party members was in attendance, including Battista and his wife, psychologist Justine McCabe from New Milford. After Fein’s talk, she pointed out that the Green Party has been a consistent and staunch supporter of single payer health insurance, moreso than almost all the Democrats in Congress (and none of the Republicans).

Single Payer "American Style"

By Robert Zarr MD, MPH, FAAP
American Academy of Pediatrics
Section of Young Physicians
Letters
Newsletter, Spring, 2008

I think the most important part of Hirotaka Yamashiro’s “Children and Single Payer Health Care: Pros and Cons,” was the comment about equity of care. Although it is important to discuss pediatrician’s relatively low reimbursement rates, more important is that America’s children receive quality care without bankrupting their families. Let’s not forget that we still have 9 million children without health insurance. These 9 million children forego necessary care, and suffer unnecessarily because of it. There is no doubt that the average Canadian child has better access to primary care than his/her American counterpart. The Canadian pediatrician, with lower office overhead, either specialist or primary care, is reimbursed with fewer hassles and more timely than his/her American counterpart. I would posit that what Canada has IS a good system that is under-funded. Canada’s neighbor to the South, in contrast, has a terribly wasteful and dysfunctional system with the largest private health insurance bureaucracy in the world. Our problem is not that we spend too little, but that we have no system. America spends twice as much per capita on health care as Canada, yet we have generally worse health outcomes. Currently more than 60% of US total health expenditures is publicly financed, and this amount is more than most developed countries spend total. Americans already pay for health care, but just don’t get it. Every developed country in the world, except the US, has government assured health insurance. Most spend half of what we do. Falling at number 37 in health outcomes, according to the World Health Organization, seems to suggest that the US has much to learn from other countries, and not vice versa. While every other developed country’s health care system most certainly has areas for improvement, none is in such a crisis as ours. We need a publicly financed but privately delivered health care system, which would be more equitable to all American children and their pediatricians. What we need in the US is single payer “American style.”