PNHP

Growth of national health expenditures, 2011

pnhpf3a

Growth of national health expenditures, 2011

National Health Spending In 2011: Overall Growth Remains Low, But Some Payers And Services Show Signs Of Acceleration

By Micah Hartman, Anne B. Martin, Joseph Benson, Aaron Catlin, the National Health Expenditure Accounts Team
Health Affairs, January 2013

Abstract

In 2011 US health care spending grew 3.9 percent to reach $2.7 trillion, marking the third consecutive year of relatively slow growth. Growth in national health spending closely tracked growth in nominal gross domestic product (GDP) in 2010 and 2011, and health spending as a share of GDP remained stable from 2009 through 2011, at 17.9 percent. Even as growth in spending at the national level has remained stable, personal health care spending growth accelerated in 2011 (from 3.7 percent to 4.1 percent), in part because of faster growth in spending for prescription drugs and physician and clinical services. There were also divergent trends in spending growth in 2011 depending on the payment source: Medicaid spending growth slowed, while growth in Medicare, private health insurance, and out-of-pocket spending accelerated. Overall, there was relatively slow growth in incomes, jobs, and GDP in 2011, which raises questions about whether US health care spending will rebound over the next few years as it typically has after past economic downturns.

Out-Of-Pocket Spending

Faster growth in 2011 reflects higher cost sharing for group health insurance plans and increased enrollment in consumer-directed health plans that have higher deductibles, copayments, or both. Additionally, increases in the number of uninsured people over the past few years had resulted in more direct out-of-pocket spending than might otherwise have been the case.

Medicaid

Slower growth in Medicaid spending reflected states’ efforts to control expenditure growth as the enhanced federal matching rates expired and state revenues continued to increase at a slow rate. With fewer federal matching dollars and continued pressure on their budgets, some states implemented cost-control measures that included provider reimbursement reductions, eligibility restrictions, benefit reductions, and increased cost sharing.

Medicare

Medicare spending for physicians’ services also accelerated in 2011, increasing 7.6 percent compared to 3.2 percent growth in 2010, even as the increase in physicians’ fees was lower in 2011. Faster fee-for-service spending growth for physician services, therefore, is attributable to a rebound in the volume and intensity of services after unusually slow growth in 2009 and 2010.

Conclusion

In 2011 national health spending increased 3.9 percent—the same rate of growth experienced in 2009 and 2010. The recent recession had an immediate and noticeable effect on the health sector because of high unemployment, loss of private health insurance coverage, and a reduction in the resources available to pay for health care. All of these factors contributed to historically low growth in aggregate health spending during 2009–11.

In 2011, however, there were some signs of change, evident in faster growth in nonprice factors such as the use and intensity of health care goods and services. Additionally, insurance coverage expanded in 2011 for dependents under age twenty-six, and overall private health insurance coverage did not decline as had been experienced in the prior three years.

Nonetheless, economic, income, and job growth in 2011 was modest and less than might normally be expected during an economic recovery. This fact raises questions about whether the near future will hold the type of rebound in health care spending typically seen a few years after a downturn. Data for the years 2012 and 2013 will provide important indications of the state of the US health system as the major insurance expansions associated with the Affordable Care Act grow nearer on the horizon.

http://content.healthaffairs.org/content/32/1/87.abstract

Comment:

By Don McCanne, MD 

National Health Expenditures (NHE), 2011

$2,700.7 – NHE, billions

17.9 – NHE as percent of GDP

$8,680 – NHE per capita

In 2011, health care costs grew at the same rate as the growth in the gross domestic product (GDP). Thus the recent severe recession and slow recovery, plus the initial phase of implementation of the Affordable Care Act, have not had a major impact on the growth of health care spending.

At a time when Medicare spending is under close scrutiny, especially for potential opportunities to reduce the federal deficit, the fact that the volume and intensity of services have increased disproportionately warrants scrutiny. Physician behavior may drive reforms that could have other consequences, favorable, or more likely unfavorable.

Shifts in Medicaid spending should raise red flags. More of the costs are being shifted to states at a time that they are facing budget crises. States are responding with measures such as provider reimbursement reductions, eligibility restrictions, benefit reductions, and increased cost sharing. These changes can result in greater impairment of access just at a time when massive enrollment increases are anticipated. This can have very serious consequences for a welfare program that is already critically underfunded.

Out-of-pocket spending is increasing, especially due to an increase in enrollment in consumer-directed health plans with high deductibles – a market strategy to reduce health care spending by erecting financial barriers to care.

Although reducing the increase in health expenditures down to the rate of increase in the GDP sounds like good news, the trends behind the numbers should have us all deeply concerned.

Need I say, a single payer…

Uwe Reinhardt explains the complexities in pricing of Medicare Advantage plans

The Complexities of Comparing Medicare Choices

By Uwe E. Reinhardt
The New York Times, January 4, 2013

The roughly 50 million Americans covered by the federal Medicare program have a choice of receiving their benefits under the traditional, free-choice, fee-for-service Medicare program or from a private, managed-care Medicare Advantage plan. The private plans have a steadily increasing number of enrollees — currently 13 million, or 27 percent of beneficiaries.

A fundamental question that has engaged health-policy researchers and commentators for some time is whether coverage of Medicare’s standard benefit package under Medicare Advantage plans is cheaper or more expensive than it is under traditional fee-for-service Medicare.

The answer is yes.

At the risk of going over ground already covered in Economix and in the scholarly literature on the subject, this answer may warrant some explanation.

(At this point, Professor Reinhardt provides an excellent explanation, with numerous helpful links, of the complexities in pricing of the Medicare Advantage plans. If you wish to understand this topic better, and understand why his answer is “yes,” the full article is well worth reading. DMc)

Comment:

Don McCanne, MD

The only correct “yes” is that Medicare Advantage plans are more expensive. The extra cost is invisible to beneficiaries because it is borne by taxpayers. The plans can be considered less expensive only if you believe that it is fair for taxpayers to provide the private plans with extra funds for their ability to cheat through well documented favorable selection (HSR DOI: 10.1111/1475-6773.12006) and the gaming of risk adjustment (GAO 12-51, Jan 12, 2012 and NBER Working Paper No. 16977).

While we’re at it, we should also mention the profound administrative waste of not only the Medicare Advantage plans but also the private Medigap plans (the latter paid by excessive premiums), and the administrative burden that they place on the health care delivery system.

Congress should stop wasting our public funds in these efforts to push us into private plans. If they took the same public and private funds already being spent and used those to improve the benefits of the traditional Medicare program (especially reducing cost sharing and capping out-of-pocket spending), then we would have an even better Medicare program. In fact, it could become the basis of the Improved Medicare for All that many of us long for but has remained elusive to a large extent because of the elevated stature that the private insurance industry holds in the Halls of Congress.

http://economix.blogs.nytimes.com/2013/01/04/the-complexities-of-comparing-medicare-choices/

State should embrace expansion of Medicaid

By Rob Stone, M.D.
Indianapolis Star, Letters, Jan. 3, 2013

The Affordable Care Act is coming. Gov.-elect Mike Pence has said the ACA will “double down on an already broken and unaffordable Medicaid system, and, left unchecked, it will destroy all the progress we have made on health-care access, not to mention our economic competitiveness and fiscal solvency for our state and country.” I disagree.

Out of the 800,000 Hoosiers currently without health insurance,363,000 could be provided Medicaid coverage. According to a Harvard study on preventable deaths due to lack of health insurance, 363 Hoosiers per year, or 1 person a day would be saved from a needless preventable death. In my work toward a national health program, I’ve heard far too many people say that they are afraid to see a doctor because they can’t afford health insurance.

Right now in Indiana if a family of four earns more than $11.50 a day, it’s too much to qualify for Medicaid. Under the ACA the same family of four can earn $30,000 a year and be covered. That’s equal to two adults working 80 hours a week at minimum wage. This would be an incredible boon to working Hoosier families, lifting the threat of financial ruin caused by an accident or illness, and opening the door to preventative care.

Experts argue how much this will cost the state. Estimates range from $50 million to as much as $150 million a year, but none contest the amount of federal money that would come into the state if we proceed – $1.7 billion a year, which would go to Indiana hospitals, doctors, nurses, and into the state’s economy. A study in Missouri predicted 24,000 jobs would be created there.

Congress was aware of how large a chunk Medicaid currently takes out of states’ budgets and made this a deal too good to refuse, with a federal contribution of more than $11 for every $1 of Indiana taxpayers’ money. If Hoosier lawmakers don’t take the deal, our federal tax dollars will go to states that do.

Where could Indiana find the money to pay our share? The Medicaid expansion would cover nearly all of the inmates in Indiana’s prisons and could save the General Fund $100 million every year. The cigarette taxes collected for the Healthy Indiana Plan, $121 million, alone would likely cover the entire cost. The state’s high-risk insurance pool (ICHIA) currently costs $48 million annually, and it will no longer be needed in 2014. We are just beginning to add up all the savings.

The fiscally responsible thing to do is for Hoosiers is to set aside our partisan differences and participate in this expansion of Medicaid. It will create jobs, strengthen our hospitals, not to mention make us healthier.

Rejecting Medicaid would be a huge blow to Indiana. If Hoosiers are serious about the right to life, it begins with caring for the living, saving 363 lives every year.

Stone, a medical doctor, is director of Hoosiers for a Commonsense Health Plan.

http://blogs.indystar.com/letters/2013/01/03/my-view-state-should-embrace-expansion-of-medicaid/

Sen. Mark Kirk's lesson for us

Sen. Kirk returns to Senate after year-long recovery from stroke

By Emily Goodin
The Hill, January 3, 2013

Sen. Mark Kirk (R-Ill.) returned to the Senate on Thursday after nearly a year’s absence.

Kirk, who had a stroke in January 2012, walked up the Capitol steps holding a cane and with the help of Vice President Biden and Sen. Joe Manchin (D-W.Va.).

Cheers rang out as Kirk began his climb. He walked into the Capitol shortly before noon, when the 113th Congress was gaveled into session.

http://thehill.com/capital-living/275411-sen-kirk-returns-to-cheers-applause

And…

Sen. Mark Kirk’s message to stroke victims: ‘Don’t give up’

By Natahsa Korecki
Chicago Sun-Times, January 2, 2013

(Sen. Mark Kirk) spoke with the Sun-Times in a sit-down interview in the U.S. Capitol one day before he plans his dramatic climb up the Capitol steps. He offered a new perspective on the Illinois Medicaid program and what it offers to those with low incomes.

He does plan to take a closer look at funding of the Illinois Medicaid program for those with no income who suffer a stroke, he said. In general, a person on Medicaid in Illinois would be allowed 11 rehab visits, he said.

“Had I been limited to that, I would have had no chance to recover like I did,” Kirk said. “So unlike before suffering the stroke, I’m much more focused on Medicaid and what my fellow citizens face.”

Kirk has the same federal health-care coverage available to other federal employees. He has incurred major out-of-pocket expenses, which have affected his savings and retirement, sources familiar with Kirk’s situation said.

http://www.suntimes.com/news/metro/17348299-418/mark-kirk-says-he-would-support-an-assault-weapons-ban.html

Comment:

By Don McCanne, MD

It was quite moving watching the live C-SPAN broadcast of Sen. Mark Kirk today, climbing the Capitol steps to the resounding ovation given to him by his colleagues in the Senate. After his severely debilitating stroke, his message to other stroke victims is, “Don’t give up,” and he didn’t.

He has had a year to think about stroke victims on Medicaid in Illinois and what the limit of a total of eleven rehabilitation visits must mean to them. This is clearly an inhumane public policy that must be changed.

But what about all of the other patients with major medical problems who do not get the care that they need because they are uninsured, or Medicaid doesn’t provide adequate access, or private insurance…

What about private insurance? Sen. Kirk has coverage through the Federal Employees Health Benefits Program (FEHBP) – a menu of private health plans. That is about as good coverage as you can get today, yet with the major out-of-pocket expenses, it has not protected his savings and retirement.

We have a much bigger problem in health care other than simply trying to figure out how we can get Medicaid patients adequate rehabilitative services after a stroke.

If only Sen. Kirk’s colleagues in the Senate and House could learn from his travails. They might begin to consider that we really do need a comprehensive health care system that takes care of all of us – an Improved Medicare for All.

In the battle for reform, remember Sen. Kirk’s words, “Don’t give up.”

Overweight, and our health care system

Association of All-Cause Mortality With Overweight and Obesity Using Standard Body Mass Index Categories

By Katherine M. Flegal, PhD; Brian K. Kit, MD; Heather Orpana, PhD; Barry I. Graubard, PhD
JAMA, January 2, 2013

In this study, we used the National Heart, Lung, and Blood Institute’s terminology with categories of underweight (BMI of <18.5), normal weight (BMI of 18.5-<25), overweight (BMI of 25-<30), and obesity (BMI of ≥30). Grade 1 obesity was defined as a BMI of 30 to less than 35; grade 2 obesity, a BMI of 35 to less than 40; and grade 3 obesity, a BMI of 40 or greater.

The most recent data from the United States show that almost 40% of adult men and almost 30% of adult women fall into the overweight category with a BMI of 25 to less than 30.

In the United States and Canada, more than half of those who are obese fall into the grade 1 category (BMI of 30-<35).

According to the results presented herein, overweight (defined as a BMI of 25-<30) is associated with significantly lower mortality overall relative to the normal weight category with an overall summary HR (hazard ratio) of 0.94.

The summary HRs were 0.94 (95% CI, 0.91-0.96) for overweight, 1.18 (95% CI, 1.12-1.25) for obesity (all grades combined), 0.95 (95% CI, 0.88-1.01) for grade 1 obesity, and 1.29 (95% CI, 1.18-1.41) for grades 2 and 3 obesity.

http://jama.jamanetwork.com/article.aspx?articleid=1555137

And…

Obesity Update 2012

OECD

Obesity rates

16.9% – All OECD nations

33.8% – United States

http://www.oecd.org/health/49716427.pdf

And…

NIH Body Mass Index (BMI) calculator:

http://nhlbisupport.com/bmi/

Comment

By Don McCanne, MD

If you are amongst the 30 to 40 percent of Americans who are overweight, you likely are resolving at the beginning of this year to finally do something about your weight. The good news is that you don’t have to. Being overweight (BMI 25->30) is associated with a mortality rate that is 6 percent lower than that for normal weight. Happy New Year.

In fact, even you fall into the category of grade 1 obesity (BMI 30->35), you still have no increase in mortality due to your weight alone. (You can use the BMI calculator at the NIH link above to determine where you fall.)

This, of course, does not mean that you are free to abandon healthy habits. Good nutrition and regular exercise are still important. To increase compliance, just be sure that the exercise program that you select is enjoyable and that it is easily integrated into your daily regimen. Same for selecting nutritious food.

Nevertheless, grade 2 and 3 obesity (BMI 35 or greater) are associated with increased mortality, so prevention and intervention are important. But is that primarily a responsibility of providers in the health care delivery system? Telling people to exercise and eat well is great advice, but it is not very effective, especially since everyone already knows that.

Prevention of obesity is more a function of society at large. Health education, school nutrition programs, responsible food product design by the industry, planning of communities to promote physical activity such as walking, biking or hiking, and including breaks for physical activity for those in sedentary occupations are types of measures that would take place out in the community rather than within the health care delivery system.

However, Grade 2 and 3 obesity do place a burden on the health care delivery system because of their association with chronic diseases. The policy community correctly emphasizes that the delivery system must provide chronic disease services. But that isn’t new. That is what primary care professionals have been doing all along.

What is a problem is that there has been a misplaced emphasis on chronic disease management as if that were a new solution to health care cost and quality issues. This has led to ineffectual tinkering by promoting nebulous models such as accountable care organizations. The efforts would be better directed toward reinforcing the primary care infrastructure.

If we really do want to improve the management of health care spending while improving quality we need to implement fundamental structural reform of our health care financing system by enacting a single payer, improved Medicare for all. It’s a system that would work great for all of us, even for those of us who are overweight.

Correction: “Overweight”

In today’s qotd message, “Overweight,” I wrote, “Being overweight (BMI 25->30) is associated with a mortality rate that is 6 percent lower than that for normal weight.”

The study demonstrated that the summary hazard ratio (HR) for overweight compared to normal weight was 0.94. Thus, “The researchers found that the summary HRs indicated a 6 percent lower risk of death for overweight.” (The JAMA Network, January 1, 2013).

http://www.digitalnewsrelease.com/?q=jama_3867

Medical students' attitudes regarding the uninsured and underinsured

Videotaped Patient Stories: Impact on Medical Students' Attitudes Regarding Healthcare for the Uninsured and Underinsured

By Richard Bruno, Allen Andrews, Brian Garvey, Kristin Huntoon, Rajarshi Mazumder, Jaleh Olson, David Sanders, Ilana Weinbaum, Paul Gorman
PLOS ONE, December 12, 2012

The attitudes of medical students toward the current United States healthcare system are not well described in the literature. A graded survey was developed to assess awareness and motivation toward the care of the uninsured and underinsured as well as the impact of a video intervention on these attitudes.

Medical students from nine medical schools were invited to participate and 895 completed the survey. Based on student coordinators’ estimates of their class size, reconciled with AAMC data, the response rate was 22.7%.

Our key findings were: (1) An overwhelming majority of medical students responding agree or strongly agree that everyone should have access to healthcare (96%) and that care should be provided regardless of ability to pay (85%); (2) two thirds of medical students responding agree or strongly agree that they have the personal responsibility to volunteer time for underserved patients (67.4%) and expressed a willingness to forgo a portion of income to provide healthcare to the underserved (66.1%); (3) 72% of respondents agree or strongly agree that publicly funded healthcare should be available to all citizens; (4) these values were strongly correlated with older age and intention to pursue primary care; (5) following a video montage of patient stories, respondents were more likely to indicate a personal desire to be involved in providing care to the underserved.

Ideas for Reform

Many students articulated a need for systemic healthcare reform. Most of those responding were in agreement that there were a number of issues within healthcare that need to be transformed, but they did not agree on any single plan for change. Respondents proposed ideas for reform ranging from changing payment structures, reducing cost of care, incentivizing healthy behaviors, reforming health insurance, to shifting toward a socialized or single payer approach to healthcare.

Physician vs. Government Responsibility

While several respondents stated that physicians across all specialties have a responsibility to care for the underserved, a large number of respondents felt strongly that physicians should choose whether or not to volunteer their time serving the uninsured and should not be obligated to do so. Others took this idea further, stating that physicians already sacrifice a lot and should always be compensated for their services. There seemed to be consensus that although physicians must play a role in caring for the underserved, they should not bear the entire responsibility of doing so. Respondents were split over whether this should be the responsibility of the government or not.

Healthcare as a Right

While a significant group of respondents felt that healthcare should be a right for all people, others felt that certain groups should be excluded or that individuals should have to take responsibility for their own health and payment for their own care. Several people stated specifically that healthcare is a right and that all people should have access regardless of their ability to pay, while others stated that healthcare should not be free for anyone and that everyone should be required to pay something. Other respondents specified that while everyone should have access to a basic level of care, those who can pay more should be able to purchase more or higher quality services. Some students clarified that specific groups, such as those who are not citizens or whose health problems are the result of unhealthy behaviors, should not receive care funded by taxpayer dollars. Several respondents also expressed concern that publicly funded care takes away personal responsibility and that people would likely take advantage of the system.

http://www.plosone.org/article/info%3Adoi%2F10.1371%2Fjournal.pone.0051827

Comment

By Don McCanne, MD

As the nation implements the provisions of the Affordable Care Act we can look forward to a future wherein, regardless of the structure of financing and the delivery system in health care, the altruistic students of today will demonstrate that we’ll be in good hands. They will make the system, regardless of how flawed, work for the benefit of everyone. Or can we be so assured?

This study does have some limitations. Less than one-fourth of students invited to participate actually responded. Because of the nature of the survey, there may have been a self-selection bias toward more altruistic students. A major feature of the study was to assess views before and after viewing a two minute video montage of patients telling their stories. Intuitively it seems unlikely that such a video could change moral and ethical perceptions developed over a lifetime, though 83 percent who viewed the video, as opposed to 77 percent who did not, expressed that they personally wanted to be involved in providing care to those without access (a “statistically significant” insignificant finding).

The key findings listed in the excerpts above superficially seem to be reassuring in that fairly large percentages of these self-selected students hold certain altruistic views. But what about the others? Do 4 percent of medical students really believe that not everyone should have access to health care? Do 15 percent believe that care should not be provided when there is no ability to pay? Do 33 percent believe that they have no personal responsibility to volunteer time for underserved patients? Are 34 percent unwilling to forgo a portion of income to provide health care to the underserved? Do 28 percent believe that publicly funded health care should not be available to all citizens?

You may be troubled as I was on reading the paragraph above titled “Healthcare is a Right.” It demonstrates that the opponents of solidarity and egalitarianism have been very effective in delivering their message that we are not all in this together, that we are each on our own. Particularly prominent are the observations expressing the view that everyone should be required to pay something, otherwise individuals would abandon personal responsibility and take advantage of the system. This, of course, represents the rhetoric of the advocates of consumer-directed health care (CDHC).

So what is wrong with CDHC? Steffie Woolhandler and David Himmelstein summarized it well in the following paragraph from their article, “Consumer Directed Healthcare: Except for the Healthy and Wealthy It’s Unwise.”

“Behind the rhetoric of consumer responsiveness and personal responsibility, CDHC sets in motion huge resource transfers. The sick and middle-aged pay more, whereas the young and healthy pay less. Women spend more, whereas men spend less. Workers bear more of the burden, whereas employers bear less. The poor skip vital care while the rich enjoy tax-free tummy tucks. And, as in every health reform in memory, bureaucrats and insurance firms walk off with an ever larger share of health dollars.”

https://pnhp.org/PDF_files/CDHC_Unwise.pdf

The question then, are these particular medical students merely passively, naively and uncritically accepting the framing as presented by the CDHC advocates, or do they really believe in a social order that is defined by our individual efforts and rejects moral precepts of social justice? Or is that even a valid dichotomy? The rhetoric of this sector of the nation’s medical students is not very reassuring.

Happy
New Year anyway.

Medical students’ attitudes regarding the uninsured and underinsured

Videotaped Patient Stories: Impact on Medical Students’ Attitudes Regarding Healthcare for the Uninsured and Underinsured

By Richard Bruno, Allen Andrews, Brian Garvey, Kristin Huntoon, Rajarshi Mazumder, Jaleh Olson, David Sanders, Ilana Weinbaum, Paul Gorman
PLOS ONE, December 12, 2012

The attitudes of medical students toward the current United States healthcare system are not well described in the literature. A graded survey was developed to assess awareness and motivation toward the care of the uninsured and underinsured as well as the impact of a video intervention on these attitudes.

Medical students from nine medical schools were invited to participate and 895 completed the survey. Based on student coordinators’ estimates of their class size, reconciled with AAMC data, the response rate was 22.7%.

Our key findings were: (1) An overwhelming majority of medical students responding agree or strongly agree that everyone should have access to healthcare (96%) and that care should be provided regardless of ability to pay (85%); (2) two thirds of medical students responding agree or strongly agree that they have the personal responsibility to volunteer time for underserved patients (67.4%) and expressed a willingness to forgo a portion of income to provide healthcare to the underserved (66.1%); (3) 72% of respondents agree or strongly agree that publicly funded healthcare should be available to all citizens; (4) these values were strongly correlated with older age and intention to pursue primary care; (5) following a video montage of patient stories, respondents were more likely to indicate a personal desire to be involved in providing care to the underserved.

Ideas for Reform

Many students articulated a need for systemic healthcare reform. Most of those responding were in agreement that there were a number of issues within healthcare that need to be transformed, but they did not agree on any single plan for change. Respondents proposed ideas for reform ranging from changing payment structures, reducing cost of care, incentivizing healthy behaviors, reforming health insurance, to shifting toward a socialized or single payer approach to healthcare.

Physician vs. Government Responsibility

While several respondents stated that physicians across all specialties have a responsibility to care for the underserved, a large number of respondents felt strongly that physicians should choose whether or not to volunteer their time serving the uninsured and should not be obligated to do so. Others took this idea further, stating that physicians already sacrifice a lot and should always be compensated for their services. There seemed to be consensus that although physicians must play a role in caring for the underserved, they should not bear the entire responsibility of doing so. Respondents were split over whether this should be the responsibility of the government or not.

Healthcare as a Right

While a significant group of respondents felt that healthcare should be a right for all people, others felt that certain groups should be excluded or that individuals should have to take responsibility for their own health and payment for their own care. Several people stated specifically that healthcare is a right and that all people should have access regardless of their ability to pay, while others stated that healthcare should not be free for anyone and that everyone should be required to pay something. Other respondents specified that while everyone should have access to a basic level of care, those who can pay more should be able to purchase more or higher quality services. Some students clarified that specific groups, such as those who are not citizens or whose health problems are the result of unhealthy behaviors, should not receive care funded by taxpayer dollars. Several respondents also expressed concern that publicly funded care takes away personal responsibility and that people would likely take advantage of the system.

http://www.plosone.org/article/info%3Adoi%2F10.1371%2Fjournal.pone.0051827

Comment

By Don McCanne, MD

As the nation implements the provisions of the Affordable Care Act we can look forward to a future wherein, regardless of the structure of financing and the delivery system in health care, the altruistic students of today will demonstrate that we’ll be in good hands. They will make the system, regardless of how flawed, work for the benefit of everyone. Or can we be so assured?

This study does have some limitations. Less than one-fourth of students invited to participate actually responded. Because of the nature of the survey, there may have been a self-selection bias toward more altruistic students. A major feature of the study was to assess views before and after viewing a two minute video montage of patients telling their stories. Intuitively it seems unlikely that such a video could change moral and ethical perceptions developed over a lifetime, though 83 percent who viewed the video, as opposed to 77 percent who did not, expressed that they personally wanted to be involved in providing care to those without access (a “statistically significant” insignificant finding).

The key findings listed in the excerpts above superficially seem to be reassuring in that fairly large percentages of these self-selected students hold certain altruistic views. But what about the others? Do 4 percent of medical students really believe that not everyone should have access to health care? Do 15 percent believe that care should not be provided when there is no ability to pay? Do 33 percent believe that they have no personal responsibility to volunteer time for underserved patients? Are 34 percent unwilling to forgo a portion of income to provide health care to the underserved? Do 28 percent believe that publicly funded health care should not be available to all citizens?

You may be troubled as I was on reading the paragraph above titled “Healthcare is a Right.” It demonstrates that the opponents of solidarity and egalitarianism have been very effective in delivering their message that we are not all in this together, that we are each on our own. Particularly prominent are the observations expressing the view that everyone should be required to pay something, otherwise individuals would abandon personal responsibility and take advantage of the system. This, of course, represents the rhetoric of the advocates of consumer-directed health care (CDHC).

So what is wrong with CDHC? Steffie Woolhandler and David Himmelstein summarized it well in the following paragraph from their article, “Consumer Directed Healthcare: Except for the Healthy and Wealthy It’s Unwise.”

“Behind the rhetoric of consumer responsiveness and personal responsibility, CDHC sets in motion huge resource transfers. The sick and middle-aged pay more, whereas the young and healthy pay less. Women spend more, whereas men spend less. Workers bear more of the burden, whereas employers bear less. The poor skip vital care while the rich enjoy tax-free tummy tucks. And, as in every health reform in memory, bureaucrats and insurance firms walk off with an ever larger share of health dollars.”

https://www.pnhp.org/PDF_files/CDHC_Unwise.pdf

The question then, are these particular medical students merely passively, naively and uncritically accepting the framing as presented by the CDHC advocates, or do they really believe in a social order that is defined by our individual efforts and rejects moral precepts of social justice? Or is that even a valid dichotomy? The rhetoric of this sector of the nation’s medical students is not very reassuring.

Happy New Year anyway.

Chronic MaineCare shortfalls — a symptom of a disease we can treat

By Philip Caper, M.D.
Bnagor Daily News, Dec. 27, 2012

About a year ago, facing a budgetary shortfall, the Maine Legislature had a knock-down, drag-out fight over Gov. Paul LePage’s proposal to save $220 million by throwing 65,000 Maine residents off MaineCare.

At that time, I predicted that the Legislature “can look forward to a repeat performance in a year or two unless they have the courage, wisdom and bipartisanship to attack the fundamental flaws in the ways we finance and deliver [all] health care services.” Well, they didn’t. And now they are.

The recently announced “unexpected” cost overrun of more than $100 million attributable mostly to MaineCare will no doubt lead to a repeat of last year’s fight. At the same time, Maine hospitals are clamoring for almost $500 million in past-due MaineCare payments.

The Legislature is now under different management. Maybe the Democrats can succeed where the Republicans failed. But to do so they will have to finally be willing to look at the big picture.

At a national level, Congress and the Obama administration are contemplating cutbacks in Medicare eligibility as one way to reduce federal spending. Such cuts, like those in MaineCare, will simply shift those costs to the private sector.

That shift will only exacerbate existing private-sector health care cost problems. Out-of-control costs have had a dampening effect on employment, depressed wages and discouraged entrepreneurship by creating job lock. They have also encouraged employers to shift whatever costs they can to their workers and to public-sector programs such as MaineCare. Walmart is the poster child for this phenomenon, but it’s hardly alone.

MaineCare cost overruns are only a symptom of larger problems in our health care system as a whole. They cannot be solved in isolation. Trying to do so is a losing strategy.

The Legislature now has an opportunity to revisit a solution they have failed to embrace in the past under both Democratic and Republican leadership — movement toward a single, publicly managed health care system for all the people of Maine.

Such a system would cover everybody, and would be a big step toward eliminating the billions of dollars of health care waste due to fraud, overtreatment, inefficiency and unnecessarily high prices. It could do so for no more than we are now spending.

It would also enable us to control total health care spending in ways far less intrusive than our current system. How is this possible? Here’s an analogy.

If a rancher has a herd of cattle and wants to limit their grazing to a limited amount of land, he can accomplish that in one of two ways. He can either tether each of the cattle to a leash (and hope they don’t find a way to break loose) or he can build a fence that effectively encloses all of them in their pasture. Controlling the entire herd is both more effective and less intrusive than trying to control individuals.

In health care we have tried tethering (mostly through private insurance companies) by restricting the individual actions of both health care givers and patients. It hasn’t worked.

A single, publicly financed and managed health care system will permit us to create a fair, unified, simplified and enforceable budget for all health care in Maine, while at the same time reducing our intrusive management of individuals’ health care decisions. It would give everybody in Maine a stake in seeing to it that the system that includes everyone works well for everyone.

As I’ve written before, Obamacare is in some ways a step in the right direction, but it’s far more complicated than need be and will not be as effective in constraining health care costs as it must be. But it does contain provisions that would permit Maine to set up a program that would provide the tools to manage the competing claims and objectives of different stakeholders. We could simultaneously improve access to care, the quality of care, and restrain the rise in costs for everyone in Maine.

I hope the Legislature takes a serious look at this approach in the coming months as they struggle with their daunting budgetary challenges. It will not be easy. That’s why it hasn’t been done before.

But if we are willing to treat the underlying pathology of our health care system instead of just the symptoms, we will have taken the first step toward fixing it. If not, we will be fighting the same fights next year and the year after.

Physician Philip Caper of Brooklin is a founding board member of Maine AllCare, a nonpartisan, nonprofit group committed to making health care in Maine universal, accessible and affordable for all. He can be reached at pcpcaper21@gmail.com.

http://bangordailynews.com/2012/12/27/health/chronic-mainecare-shortfalls-a-symptom-of-a-disease-we-can-treat/print/

Health care challenges in Minnesota tied to access, insurance, says physician advocates

By Andrea Parrott
Twin Cities Daily Planet, Dec. 24, 2012

After daily witnessing situations in which patients suffered or had to make decisions detrimental to their health due to difficulties in accessing health care, Dr. Elizabeth Frost and Dr. Ann Settgast had enough. They felt they had to do something that would allow everyone to have health insurance and so, access to health care. The two decided to found the Minnesota chapter of Physicians for a National Health Program (PNHP).

PNHP is a national non-profit organization whose members advocate for single payer health care. The idea of single payer health care is that instead of people paying fees to a private health insurance company, they will pay one fund. Hospitals, doctors, and other health providers would then receive payment from that one fund. Dr. Settgast explained single payer in this way: “Some people use an analogy of ‘Medicare of all’ as a synonym for single payer… It’s an example of a fund where everyone pays into the fund and then that fund pays for health care and private deliverers of health care. So Medicare is like a little micro single payer.”
 
Twin Cities Daily Planet spoke with the doctors, asking them about the state of health care in Minnesota. The edited interview is below.

What are some personal experiences that led you to advocate for a single payer health program?

Dr. Settgast: That’s a great question that could take me like 12 hours to answer. I’m a primary care doctor so I take care of patients on a daily basis. Every single day I see reasons why we need single payer. A recent one would be a woman who I took care of—a Vietnamese woman in her early 60s who came in and I diagnosed her with rheumatoid arthritis, which is terrible—she had terrible swelling of her hand joints. Really deforming joint disease. She was a full-time employee of a company and her husband worked full time as well. Got her to the rheumatologist. Got her on the right drugs. Her joints totally improved. Her pain was eliminated. She was fully functional. Everything was great.

And then, she just didn’t show up for like two or three years. One day she just shows up on my schedule… So I came into the room. She’s a tiny little woman and from the door, I could see her joint was like the size of a golf ball—like hugely swollen. I said, I’ll just change her name, I said “Lynn, what happened? Where have you been?” Since I had seen her, she got laid off from her job and her husband died. And she was only 63 at the time that this happened… She didn’t have access to health care so she just had to stop her drugs, stop seeing her rheumatologist and her joints deteriorated… I didn’t realize, but she had turned 65, so she was back. And it’s disgusting because this woman’s hand is ruined and it’s totally preventable. We see this stuff every single day. And it’s inhumane and it’s disgusting as a physician when all you care about is taking care of sick people to see people not access care.

Dr. Frost: A daily basis there are stories… Yesterday I had a patient who stopped her birth control and now is pregnant. I also today had somebody who had psoriasis… they haven’t had it treated in almost a year now because they don’t have insurance… Again, again, and again, you’re looking at somebody and apologizing for our medical system. “That’s really unfair. I’m sorry that happened to you.” You can’t just keep doing that again and again. You have to find some other outlet to feel like you’re making a difference on a larger level.

What do you see as the main health care policy issues in Minnesota?

Dr. Settgast: We are leading the nation in the number of individuals with high deductible health insurance plans. The idea is that this would somehow promote personal responsibility. You have a high deductible so you’re not going to go to the doctor unless you really need to because you’re going to be spending your own money. But what that says is that you’re relying on people who aren’t doctors to decide whether they need medical care or not—is problematic right there. That’s our job: to say, “No, this is not something serious, you’re OK.” People shouldn’t be relied on to do that at home. But then the other issue that we know, there is actually good data showing that the higher your deductible, the less care you receive. And there’s no way to know that that care isn’t needed. You’re much more likely to see conditions being under-managed or undiagnosed. People just aren’t going to the office when they’re sick…

Dr. Frost: I think a big huge policy thing that’s really going on in Minnesota right now, of course, is the exchanges and figuring out how to set up the exchanges under the Affordable Care Act—that’s huge. That’s going to take up a lot of energy in the next year or two, but I don’t know how much it’s really going to solve the problem.

Dr. Settgast: It’s not going to solve it because all you’re doing is adding this level of administrative complexity when now people can go shopping in this exchange to get their private health insurance. It might help some people to get some policy, but it’s not designing the system so that it will work. It’s adding more complexity to an already chaotic system… You still have these huge billing departments having to bill multiple payers and you’re still having insurance companies take all this money off the top… for functions that have nothing to do with health care. There’s still a huge amount of waste still in the system and we haven’t done anything to change that.

What are some of the main health policy issues that you see facing the nation?

Dr. Frost: I think Minnesota is a little bit ahead of the rest of the nation in the area that we’re talking about… Like we already offer Medicaid to adults without children.

Dr. Settgast: Our Medicaid eligibility rules are much better here… I have a brother in Indiana… if he was here he would qualify for coverage…

Dr. Frost: We’re talking a lot about how health care is paid for when we do single payer… I think Minnesota has some of the largest health care disparities. I know that education is the worst in the nation in terms of disparities… I don’t know how we compare to other states in terms of health care, but I have a feeling it’s not very good. One of the things that really distresses me a lot is especially the Native Americans have terrible, terrible health care statistics… It’s really, really sad and that’s a population I work with a lot.

Dr. Settgast: The problems in the nation are the same as the problems here: uninsurance, underinsurance, people not having access to care. That’s all in all of the states.

Dr. Frost: Of course the biggest problem is the insurance industry… It’s not like the politicians are in charge and they’re guiding the system—no, they need to figure out what the [insurance] industry might accept and then work within those boundaries… Our politicians are controlled pretty much by the industry… The evidence for a single payer system is so ridiculously strong, it’s really amazing that we weren’t able to do more with the Affordable Care Act. It’s really quite astounding—that the Affordable Care Act is such a big deal and it does so little… one of things that was not allowed to be on the table, was not allowed to be discussed at all was the idea that the government would purchase drugs for our elderly… Now there’s like a gazillon Medicare Part D plans. Each one of those little plans doesn’t have the purchasing power to drive down the price of drugs.
Dr. Settgast: We see the patients who don’t take their medicines, or they take them every other day because they have to make them last.

What are some of the main challenges to making changes in health policy?

Dr. Settgast: The health insurers. Because if you look at the polling data, the public supports single payer, physicians support single payer… We know you can cover everyone for less cost and give everyone high quality coverage.

What happens in the U.S. is if I’m the doctor and I see 20 patients in a day and I diagnose them all with the same thing. Let’s say they all have diabetes or uncontrolled sugar. Every patient, depending on their payer, may pay my clinic a different fee because all the payers, the insurance companies, are negotiating with the all the clinics separately… so it’s hugely complicated, which is part of the cost—all these contract negotiations because everybody gets a different deal and so every patient pays differently… It’s so unequal. And then if you’re uninsured and you come in, you have a totally different cost than what the insurance pays in the next room.

Dr. Frost: It’s totally unfair. Because you’re uninsured, you have to pay the full price… if you’re totally uninsured you have to pay the $300 while the insurance pays $200, and Medicaid might pay $175 and Medicare might pay $215…

What progress do you see in addressing health disparities in Minnesota?

Dr. Settgast: I personally think it’s crazy to try and address health disparities without having a system that covers everyone. I mean how can you really expect to decrease disparities if you have whole portions of the population that don’t have any access to the system? You can’t do things on a population level if you’re leaving 10 percent of the people out… I mean obviously having a single payer doesn’t eliminate all health care disparities because a lot of health care disparities isn’t necessarily access to the system, but it’s the first step… I mean, how are they going to stand on equal footing in terms of their diabetes control or their hypertension control if they don’t have a doctor because they don’t have health insurance?

Dr. Frost: I think it’s important to differentiate between health disparities and health care disparities because health disparities are, a lot of them are socially determined. So if you don’t have a grocery store in the area… that will make it a lot harder to eat well… So I think separating those two things are important, but in terms of access to health care, I see again and again and again… somebody gets out of Medicaid and gets a job and loses their insurance so they can’t see you anymore. So once you get back… on your feet, you get back into the system, you can’t treat those diseases that you’ve been treating… So it’s that inequality in the health care system, the injustice in the health care system is what makes me so angry, and it’s because I see it every day.

© 2012 Andrea Parrott

http://www.tcdailyplanet.net/news/2012/12/23/mn-voices-health-care-challenges-minnesota-tied-access-insurance-says-physician-advo

GAO report on USPS Retiree Health Benefits Fund

U.S. POSTAL SERVICE
Status, Financial Outlook, and Alternative Approaches to Fund Retiree Health Benefits

GAO (U.S. Government Accountability Office), December 4, 2012

The Postal Service Retiree Health Benefits Fund (PSRHBF) covered about 49 percent of the U.S. Postal Service’s (USPS) $94 billion retiree health benefit liability at fiscal year-end 2012. USPS’s deteriorating financial outlook, however, will make it difficult to continue the current prefunding schedule in the short term, and possibly to fully fund the remaining $48 billion unfunded liability over the remaining 44 years of the schedule on which the 2006 Postal Accountability and Enhancement Act (PAEA) was based.

USPS is intended to be a self-sustaining entity funded almost entirely by postal ratepayers, but its financial losses are challenging its sustainability. GAO has testified that USPS should prefund its retiree health benefit liabilities to the maximum extent that its finances permit, but none of the funding approaches may be viable unless USPS has the ability to make the payments. USPS’s default on its last two required PSRHBF payments and its inability to borrow further make the need for a comprehensive package of actions to achieve sustainable financial viability even more urgent.

USPS agreed that comprehensive reform is necessary to achieve financial sustainability. It also recognized its obligation to provide effective, affordable health benefits to its employees and retirees, but said that it does not have the financial resources to make prefunding payments required by current law.

http://www.gao.gov/products/GAO-13-112

Comment

By Don McCanne, MD

Linking health insurance to employment has contributed greatly to the dysfunction of health care financing within the United States. If it were a good method, you would think that the United States Postal Service would provide an exemplary model for such financing.

This GAO report confirms that none of the proposed funding approaches for the Postal Service Retiree Health Benefits Fund may be viable unless USPS has the ability to make the payments. The USPS has responded in writing that “it does not have the financial resources to make prefunding payments required by current law.”

It is long past time to take the employer out of health care coverage and financing decisions. Instead, we should establish our own single universal risk pool funded equitably through the tax system. Employers could get on with the task of managing their own businesses, while our public stewards would take charge of managing more efficiently and more assuredly health care financing for all of us.

New America Foundation implicitly endorses single payer

Social Contract Budgeting: Prescriptions from Economics and History

By Peter H. Lindert, Distinguished Research Professor of Economics, University of California – Davis
New America Foundation, December 2012

America has yet to accept the insurance solution that has worked relatively well in other countries: let the government serve as a dominant payer, with mandatory universal coverage and mandated pure community rating. (Note that international experience recommends single-payer insurance, but is indifferent to government provision of health care.) Instead, American state and federal insurance systems embody an unavoidably messy political compromise, one in which the public is forced to buy coverage choosing from a menu of private insurers. As it stands, the government will act as single regulator, not as single payer. This has the political advantage of keeping government budgets from raising taxes to cover insurance, but the disadvantage of perpetuating, and still subsidizing, a costly private insurance industry.

http://growth.newamerica.net/sites/newamerica.net/files/policydocs/Lindert_Peter_NAF_SocialContractBudgeting_2012.pdf

And…

New America Foundation

About New America

The New America Foundation is a nonprofit, nonpartisan public policy institute that invests in new thinkers and new ideas to address the next generation of challenges facing the United States.

With an emphasis on big ideas, impartial analysis and pragmatic solutions, New America invests in outstanding individuals whose ability to communicate to wide and influential audiences can change the country’s policy discourse in critical areas, bringing promising new ideas and debates to the fore.

http://newamerica.net/about

Comment

By Don McCanne, MD

This statement implicitly supporting single payer is of great importance because of its source. The New America Foundation was established to move beyond partisan politics. “The foundation’s mission is animated by the American ideal that each generation will live better than the last.”

In his article, “Social Contract Budgeting,” UC Davis Professor Peter Lindert discusses four fronts: education, health insurance, pensions, and broad taxes. Although he attempts to move beyond politics, most of us will still reflect on his concepts under the cloud of our own biases. As an example, although some of us are uncomfortable with the concept of a VAT (value added tax, a consumption tax), he discusses a variation in which the VAT can be progressively redistributive.

For those of us who have campaigned so long and so hard for health care justice, Lindert states what we perceive to be the obvious: we need to move beyond politics and “accept the insurance solution that has worked relatively well in other countries,” noting that “international experience recommends single-payer insurance.”

Bruce Bartlett's Christmas gift to all of us

Though it is not our policy to distribute a Quote of the Day message on Christmas Day, we have to make an exception this year and thank Bruce Bartlett for his Christmas present to PNHP and to all of us who dream of a future with health care justice throughout the nation.

A Conservative Case for the Welfare State

By Bruce Bartlett
The New York Times, December 25, 2012

(Bruce Bartlett held senior policy roles in the Reagan and George H.W. Bush administrations and served on the staffs of Representatives Jack Kemp and Ron Paul.)

At the root of much of the dispute between Democrats and Republicans over the so-called fiscal cliff is a deep disagreement over the welfare state. Republicans continue to fight a long-running war against Social Security, Medicare, Medicaid and many other social-welfare programs that most Americans support overwhelmingly and oppose cutting.

Republicans in Congress opposed the New Deal and the Great Society, but Republican presidents from Dwight D. Eisenhower through George H.W. Bush accepted the legitimacy of the welfare state and sought to manage it properly and fund it adequately. When Republicans regained control of Congress in 1994 they nevertheless sought to repeal the New Deal and Great Society programs they had always opposed.

Republicans are now using the fiscal impasse to try to raise the age for Medicare and reduce Social Security benefits by changing the index used to adjust them for inflation. They know that such programs will be easier to abolish in the future if the number of people who qualify can be reduced and benefits are cut so that privatization becomes more attractive.

This is foolish and reactionary. Moreover, there are sound reasons why a conservative would support a welfare state.

One problem with this conservative view is its lack of an empirical foundation. Research by Peter H. Lindert of the University of California, Davis, shows clearly that the welfare state is not incompatible with growth while providing a superior quality of life to many of those left to sink or swim in America.

In a new paper for the New America Foundation, Professor Lindert summarizes his findings. He points out that there are huge efficiencies in providing pensions and health care publicly rather than privately. A main reason is that in a properly run welfare state, benefits are nearly universal, which eliminates vast amounts of administrative overhead necessary to decide who is entitled to benefits and who isn’t, as is the case in America, and eliminates the disincentives to work resulting from benefit phase-outs.

A 2003 study in the New England Journal of Medicine found that Canada’s single-payer health system had less than a third of the per-capita administrative cost of the United States system, with its many private insurance companies and overlapping government programs.

Americans believe that their health system is the best in the world, but in fact it is not.

The one area where the United States tops all other countries in terms of health is cost. According to the Organization for Economic Cooperation and Development, the United States spent more than any other country – 17.4 percent of gross domestic product on health in 2009. By contrast, Britain spent only 9.8 percent of G.D.P. on health.

Thus, for no more than the United States already spends through government, we could have a national health-insurance system equal to that in Britain. The 7.6 percent of G.D.P. difference between American and British total health spending is about equal to the revenue raised by the Social Security tax. So, in effect, having a single-payer health system like Britain’s could theoretically give Americans 7.6 percent of G.D.P. to spend on something else – equivalent to abolishing the payroll tax.

This is a powerful conservative argument for national health insurance.

http://economix.blogs.nytimes.com/2012/12/25/a-conservative-case-for-the-welfare-state/#more-158917

Comment

By Don McCanne, MD

Thank you, Bruce Bartlett, for perhaps the greatest Christmas gift of all – a rationale for why we all have to join together to provide health care for everyone.

(The 2003 NEJM article cited is that of PNHP co-founders Steffie Woolhandler and David Himmelstein, plus Terry Campbell of the Canadian Institute for Health Information.)