PNHP

Health care insurance lessons from Greece

pnhpf3a

Health care insurance lessons from Greece

Amid Cutbacks, Greek Doctors Offer Message to Poor: You Are Not Alone

By Liz Alderman
The New York Times, October 24, 2012

Life in Greece has been turned on its head since the debt crisis took hold. But in few areas has the change been more striking than in health care. Until recently, Greece had a typical European health system, with employers and individuals contributing to a fund that with government assistance financed universal care. People who lost their jobs still received unlimited benefits.

That changed in July 2011, when Greece signed a loan agreement with international lenders to ward off financial collapse. Now, as stipulated in the deal, Greeks who lose their jobs receive benefits for a maximum of a year. After that, if they are unable to foot the bill, they are on their own, paying all costs out of pocket.

About half of Greece’s 1.2 million long-term unemployed lack health insurance, a number that is expected to rise sharply in a country with an unemployment rate of 25 percent and a moribund economy, said Savas Robolis, director of the Labor Institute of the General Confederation of Greek Workers. A new $17.5 billion austerity package of budget cuts and tax increases, agreed upon Wednesday with Greece’s international lenders, will make matters only worse, most economists say.

“In Greece right now, to be unemployed means death,” said Dr. Kostas Syrigos, (the chief of oncology at Sotiria General Hospital in central Athens).

“We are moving to the same situation that the United States has been in, where when you lose your job and you are uninsured, you aren’t covered,” Dr. Syrigos said.

http://www.nytimes.com/2012/10/25/world/europe/greek-unemployed-cut-off-from-medical-treatment.html?hp&_r=0&pagewanted=all

Comment:

By Don McCanne, MD

Greece’s austerity program has been devastating. Greece’s lenders have imposed on them the requirement that individuals lose their health insurance after one year of unemployment. As Dr. Kostas Syrigos states, “We are moving to the same situation that the United States has been in, where when you lose your job and you are uninsured, you aren’t covered.”

So the European nation that is suffering most from the current financial crisis has had to drop its health care coverage standards to that of the United States. Isn’t there a lesson here for us?

But you say that the Affordable Care Act has fixed that. If you lose your employer-sponsored coverage you can always buy insurance in the exchanges (but not if you can’t pay your share of the subsidized premium). If you lose most or all of your income, you can always sign up for Medicaid (but not if your state declined to participate in the expanded program).

Greece is right to hold us up as the example of the worst health care coverage standards of all industrialized nations. The irony is that we are wealthy enough and are already spending enough money to do something about it, but we don’t. We still can, by enacting an improved Medicare that covers everyone. Can’t we learn from Greece’s experience?

Mark Pauly: Cost effectiveness depends on cost sharing

Cost Effectiveness Analysis and the Design of Cost-Sharing in Insurance: Solving a Puzzle

By Mark Pauly
National Bureau of Economic Research, October 2012

Abstract
 
The conventional model for the use of cost effectiveness analysis for health programs involves determining whether the cost per unit of effectiveness of the program is better than some socially determined maximum acceptable cost per unit of effectiveness. If a program is better, the policy implication is that it should be implemented by full coverage of its cost by insurance; if not, no coverage should be provided and the program should not be implemented.  This paper examines the unanswered question of how cost effectiveness analysis should be performed and interpreted when insurance coverage can involve non-negligible cost sharing.  It explores both the question of how cost effectiveness is affected by the presence of cost sharing, and the more fundamental question of cost effectiveness when cost sharing is itself set at the cost effective level.  Both a benchmark model where only “societal” preferences (embodied in a threshold value of dollars per unit of health) matter and a model where individual willingness to pay can be combined with societal values are considered. A common view that cost sharing should vary inversely with program cost effectiveness is shown to be incorrect. A key issue in correct analysis is whether there is heterogeneity either in marginal effectiveness of care or marginal values of care that cannot be perceived by the social planner but is known by the demander. The cost effectiveness of a program is shown to depend upon the level of cost sharing; it is possible that some programs that would fail the social test at both zero coverage and full coverage will be acceptable with positive cost sharing.  Combining individual and social preferences affects both the choice of programs and the extent of cost sharing.

From the Introduction

Of course, the answer to the question of the relationship between cost effectiveness values and cost sharing depends both on the perspective taken and the empirical facts.  So I first outline the simple and correct application of a decision rule to treatment choices based on cost effectiveness in the “binary coverage” setting, when insurance either covers 100 percent of the cost of a given type of care or leaves it entirely uncovered,  and the extra welfarist approach is taken.  I show that this approach usually is based on two assumptions: a single value for expected improvement in health outcomes is to be applied to all patients, and a single monetary value for those expected marginal benefits prevails.  This is the approach, avowedly “extra-welfarist,” much favored at present in the United Kingdom by the NICE advisory body.

However, I then show that opening the door to consideration of cost sharing means that many things, including this perspective, might appropriately be modified.  Modifications are needed if there is heterogeneity in either effectiveness of the treatment across patients or in the values citizens place on health outcomes, and that heterogeneity is determined to be relevant to policy.  I show that the ideal level of “interior” cost sharing depends on whether consumer values are assumed to be relevant, on how much consumer values really vary, and most especially on whether the extent of variation in expected effectiveness across patients is perceived by patients but cannot be known by the insurer.  I briefly consider as well the possibility that social values are variable or uncertain.

Conclusion
 
These are somewhat discouraging conclusions.  They definitely imply that there is no simple but correct way to move from findings of a typical cost effectiveness study to saying what the coinsurance rate should be for a non-poor population.  The most one could hope for would be a binary decision of whether or not a particular treatment should or should not be covered by insurance with a particular predetermined cost sharing rate (usually but not necessarily zero).  They also imply that the cost effectiveness of a treatment cannot be properly determined unless coinsurance is set at the optimal level.  So, unless there is perfect information to identify heterogeneity of benefits, considerations of consumer demand (in the classic economic sense of the shape of the demand curve) need to be added, regardless of the normative model.

The fundamental problem is the assumption of a uniform benefit of uniform value which is central to the societal cost effectiveness model.  This assumption is presumably made for administrative and expository reasons, not because anyone believes that marginal health benefits are uniform, or that the marginal value of a health benefit (to a consumer or society) is independent of the current level of health or allocation of resources.  It was hard enough to get policymakers to accept the need for considering costs and the need to establish a money value for health outcomes, however arbitrary, and in the United States neither of these concepts is as yet effective.  But paradoxically it might be more feasible to get political acceptance if more attention to reasonable variation in effectiveness and value were explicit rather than suppressed in the analysis.  As always, there is a case to prefer approximating the perfect rather than precisely hitting the imperfect as a method of policy analysis.

http://papers.nber.org/papers/w18481

Comment:

By Don McCanne, MD

Mark Pauly has contributed extensively to the policy literature on the moral hazard of health insurance (the hazard that individuals will obtain care that they do not need if they do not have to pay for it), a concept which has been used to support cost sharing (deductibles, co-payments and coinsurance) as a means to create consumer price sensitivity. Pauly now expands on the concept by applying it to cost effectiveness analysis.

With our very high health care costs, it is inevitable that more attention will be paid to cost effectiveness. Although most cost effectiveness analyses are aimed at whether or not a particular health care service or product provides adequate societal value (measured benefit per unit cost, especially costs that society pays through public programs or private insurance), Pauly now suggests that the value to the individual, as expressed by the level of cost sharing tolerated, should also be introduced in determining cost effectiveness.

First, a few words about cost effectiveness. Most health care professionals do attempt to provide cost effective care. If a very expensive procedure likely would provide no health care value, the practitioner would advise against its use. Likewise, low cost but high volume interventions that are eventually shown to be ineffective also would be abandoned by the practitioner.

Sometimes we simply don’t know whether the benefit is worth the cost. This is where cost effectiveness analysis can be helpful. If a cancer drug regimen that costs $300,000 results in maybe three months of poorer quality life due to side effects, but prolongs life by only three days, most reasonable individuals would decide that this is not cost effective and should not be paid for through our collective funds, whether government taxes or private insurance funds. Three months of hospice is better than three months and three days of therapeutic misery.

An example of a low cost, high volume intervention might be the use of an anti-hypertensive drug that in long term studies showed absolutely no benefit in reducing morbidity or mortality. Obviously that would not be cost effective, and its use would be abandoned.

Okay. So we determine that most medical interventions fall somewhere
between 100 percent cost effective and not cost effective at all. Then we are supposed to determine a level of cost sharing for each intervention that would motivate the patient to make a correct decision on whether or not to accept the care based on consumer-directed cost effectiveness decisions that still provide adequate societal value? Come on!

Forget moral hazard. Through cost effectiveness analyses we can determine whether or not medical interventions should be available to patients, and we don’t need to have patients making spending decisions to determine health care value. Even if the benefit may not be uniform between patients, the decisions should be made at the clinical level based strictly on medical benefit and not on cost. Cost decisions should be made at the societal level.

The purpose of cost sharing is to reduce health care spending. Our message earlier this week demonstrated that controlling moral hazard through cost sharing introduces behavioral hazard; that is, decisions that patents make when exposed to out-of-pocket costs as a consequence of accessing health care can be detrimental. Policies that promote detrimental medical decisions are bad policies.

Keep in mind that we spend almost twice as much per capita on health care as the United Kingdom, yet we have ever-increasing cost sharing whereas their system pays 100 percent of the cost of covered services. There are many features of their national health services that result in lower costs, but one that applies to today’s discussion is their application of cost effectiveness and evidence-based analyses through their National Institute for Health and Clinical Effectiveness (NICE). Eliminating ineffective and detrimental care reduces costs, with a net gain in quality.

Just think of what we could have if we established a single payer financing system. We could reduce administrative and clinical waste while eliminating financial barriers to care so that everyone would have access to cost effective and evidence-based, high quality care – care that is really NICE.

Doctors to candidates: Don't mess with Medicare

By The Associated Press
USA Today, Oct. 18, 2012

PNHP note: The following 1 1/2 minute video produced by The Associated Press and carried by USA Today shows about 50 doctors, medical students and nurses, along with a comparable number of senior citizens and other health care advocates, rallying in front of the Waldorf Astoria hotel in New York City where President Obama and Republican challenger Mitt Romney were attending a black-tie dinner. The theme of the rally was “Don’t mess with Medicare,” and many of the activists, including PNHP members who were there, advocated for an improved Medicare for all. Among the featured speakers in the AP video, which was carried by many news outlets across the country, is Dr. Elizabeth Rosenthal of the NY Metro chapter of PNHP. Other news stories featured PNHP members Dr. Matt Anderson, Dr. Steve Auerbach, and medical students Andy Simmons and Lusha Liang, among others.

Watch the video by clicking here.

Doctors to candidates: Don’t mess with Medicare

By The Associated Press
USA Today, Oct. 18, 2012

PNHP note: The following 1 1/2 minute video produced by The Associated Press and carried by USA Today shows about 50 doctors, medical students and nurses, along with a comparable number of senior citizens and other health care advocates, rallying in front of the Waldorf Astoria hotel in New York City where President Obama and Republican challenger Mitt Romney were attending a black-tie dinner. The theme of the rally was “Don’t mess with Medicare,” and many of the activists, including PNHP members who were there, advocated for an improved Medicare for all. Among the featured speakers in the AP video, which was carried by many news outlets across the country, is Dr. Elizabeth Rosenthal of the NY Metro chapter of PNHP. Other news stories featured PNHP members Dr. Matt Anderson, Dr. Steve Auerbach, and medical students Andy Simmons and Lusha Liang, among others.

Watch the video by clicking here.

U.S. executives most concerned about health care costs

Healthcare costs top U.S. executives' concerns: Adecco survey

By Nick Zieminski
Reuters, October 22, 2012

U.S. corporate executives are more worried about providing healthcare benefits to their employees than about issues like wages, taxes or attracting qualified workers, according to a survey by the world’s No. 1 staffing company, Adecco SA.

In Adecco’s poll of senior executives, 55 percent named healthcare benefits as their biggest current business challenge, and about a third say they are holding back hiring because of healthcare reforms introduced by U.S. President Barack Obama.

Healthcare’s prominence as an issue has risen since the 2008-2009 recession, Adecco found: in 2007, only 35 percent called healthcare their top worry.

Obama’s 2010 healthcare law, upheld this year by the U.S. Supreme Court, is expected to raise insurance costs for employers because it calls for wider coverage of more people, including those with pre-existing medical conditions.

http://www.reuters.com/article/2012/10/22/us-adecco-election-survey-idUSBRE89L12T20121022

Comment:

By Don McCanne, MD

The Affordable Care Act (ACA) was designed to not disturb the largest sector of health insurance coverage already in existence: employer-sponsored health plans. Although costs were said to be almost intolerable for many employers, ACA included provisions to improve private health plans which will further increase costs for employers. Thus it is no surprise that health care has moved up on the executives’ list of concerns as their biggest business challenge.

Before the Democrats settled on the ACA model of reform, employers were looking for better ways of controlling costs. One of the models under consideration was single payer, an attractive option because of its greater efficiencies and assured coverage of everyone.

Business executives might have been more interested in the single payer model except for two perceived drawbacks: 1) They were not assured that they wouldn’t have to foot much of the bill for a national health program through higher payroll taxes, higher taxes on executive compensation, and higher corporate taxes, and 2) Many of them are ideologically conservative and did not want to see a government-run health care financing system.

With the passage of ACA health care moved from a top concern of 35 percent of the executives to a top concern of 55 percent of them. That suggests that they may believe they made a bad decision in passively allowing ACA to move forward, though there was token opposition from the U.S. Chamber of Commerce and the National Federation of Independent Business.

Another change taking place is that businesses are relying more on Medicare for their retirees as they pare back their health benefit programs for former employees. Obviously they recognize that Medicare provides a greater value for them than did their private programs, especially because of the federal funding of Medicare. It would not be much of a reach for them to decide that Medicare would also provide a greater value for them if it became the health benefit program for their active employees.

If we were to move forward with an improved Medicare that covered everyone, then the employers would need to be convinced that the taxes to fund the universal risk pool would be equitably distributed, and that they would not have to bear an unfair excessive financial burden for the program. Without getting into details on tax policy, suffice it to say that such a goal is readily achievable.

That would leave only ideology as a hurdle. Successful businessmen certainly place great importance on value. When it is demonstrated to them that an improved Medicare for all would control their health care costs well into the indefinite future, they would be very foolish to reject such a good deal. They really wouldn’t have to give up their ideology. They could take it to the smoking lounge and vent with their business colleagues, over a cigar and a snifter of brandy, how terrible it is that they had to accept the terms of a single payer system, but, after all, business is business.

Canadians are ready for an adult conversation on Medicare

Canada's health-care system is ticking along nicely, Dr. Michael Rachlis says

By Michael Rachlis, M.D.
The Toronto Star, Oct. 14, 2012

Over the past two years, Brian Mulroney, former Bank of Canada governor David Dodge and other prominent Canadians have called for an “adult conversation on medicare.” This month Globe and Mail columnist Jeffrey Simpson became the latest member of the Canadian chattering class to call for a mature deliberation about Canada’s favourite social program.

The analysis usually proceeds from a 30-second case for medicare’s unaffordability. Medicare might have been well-meant but health costs are rising faster than government revenues and the economy. Governments can’t fix medicare’s problems without raising taxes, which isn’t an option. The only hope is that Canadians will finally have a grown-up conversation about medicare and at least introduce more for-profit care if not dismantle it entirely.

This story is frequently told and easily understood. But it’s almost completely false.

Total health-care costs as a share of the economy did rise when the economy tanked in 2008-9 but they have been falling for two years. For the past two years, provincial government health costs have also fallen as a share of GDP and as a share of their overall spending. Far from hitting the forecast 70 per cent, or even 50 per cent of program expenditures, provincial health costs are less than 38 per cent of program spending and falling.

Health care did grow from 33 per cent of program spending in the 1990s to 39 per cent in 2003 but this wasn’t so much due to higher health costs as it was due to government cuts to other portfolios. From 2000 to 2011, Canadian governments cut taxes by nearly 6 per cent of GDP amounting to foregone annual revenue of $100 billion. And, contrary to the Canadian chin-wag consensus, Canadians strongly support higher progressive taxes. A spring Forum Institute poll indicated that Ontarians favored by four to one raising higher earners’ income taxes. Even Conservative voters favored fair taxes by two to one.

But the good news is medicare doesn’t need much if any new money or for-profit care. Many examples across the country demonstrate we could almost eliminate waits for doctors and other services through process improvement and system redesign. But Simpson and others seeking the mythical adult discussion hardly mention public sector options. These grownups are either ignorant about Etobicoke’s Queensway surgicentre — North America’s largest ambulatory surgical facility — or they want to keep us ignorant. The Queensway is part of the Trillium health system, a public hospital.

Unfortunately, medicare’s real story doesn’t get much air time. Former Saskatchewan premier Tommy Douglas talked all his life about the need for the second stage of medicare. He said the first stage featured public payment for the old system based on treating illness with doctors and hospitals. He said the second stage would highlight a redesigned delivery system focused on keeping people healthy.

In the 1960s, Douglas and Supreme Court judge and co-founder of medicare Emmett Hall supported salaried doctors working in interdisciplinary teams. However, Douglas maintained that it was too politically difficult to change the way doctors were paid and how they did their work coincidently with pressuring them into public payment. For the rest of his life, he repeatedly warned that if the delivery system was left unreformed, medicare would increasingly fail Canadians and lose political support.

When Canadians hear about the second stage of medicare, they are more than ready for a mature conversation. When they hear about innovations to reduce wait lists, they are ready to eradicate them with public sector solutions. When they hear that public finance is more efficient and that Canadian taxes have been cut by $100 billion, they are ready for medicare to cover drugs and continuing care.

So let’s start the grown-up conversation with a real question about access. Best practices across Canada demonstrate that we could see our family doctors within one day, see specialists within one week, and get elective surgery within three months. And we could get this much better care for little or no additional cost. How can we make this happen within the next two years everywhere in this country?

It’s true that this won’t be an easy. But it’s a miracle we got medicare at all. The medical profession, almost all the provinces, and most of the Canadian elite opposed medicare 50 years ago. Fortunately, the Canadian people strongly supported medicare then and they still do. Let’s plug into that good will and modernize our health system for the 21st century.

Dr. Michael Rachlis is a health policy analyst and an associate professor at the University of Toronto. www.michaelrachlis.ca

http://www.thestar.com/opinion/editorialopinion/article/1271031–canadians-are-ready-for-an-adult-conversation-on-medicare

US and Canada Medicare spending

EMBARGOED until Oct. 29, 2012, at 4 p.m. Eastern time.

Note: To SAVE these files to your hard drive, right-click (option-click on the Mac) the link and select “Save Target As” or “Download to Disk.” Left-clicking these files will only open them in a temporary directory.


Manuscript

Cost Control in a Parallel Universe: Medicare Spending in the U.S. and Canada

Resources

E-Methods and E-Files


Incorrect Password
Please enter the correct password

“;}
print “

Please enter your password for access: “;
print “

“;
}
?>

Behavioral hazard in health insurance

By Katherine Baicker, Sendhil Mullainathan and Joshua Schwartzstein
Working Paper 18468
National Bureau of Economic Research, October 2012

ABSTRACT

This paper develops a model of health insurance that incorporates behavioral biases. In the traditional model, people who are insured overuse low value medical care because of moral hazard. There is ample evidence, though, of a different inefficiency: people underuse high value medical care because they make mistakes. Such “behavioral hazard” changes the fundamental tradeoff between insurance and incentives. With only moral hazard, raising copays increases the efficiency of demand by ameliorating overuse. With the addition of behavioral hazard, raising copays may reduce efficiency by exaggerating underuse. This means that estimating the demand response is no longer enough for setting optimal copays; the health response needs to be considered as well. This provides a theoretical foundation for value-based insurance design: for some high value treatments, for example, copays should be zero (or even negative). Empirically, this reinterpretation of demand proves important, since high value care is often as elastic as low value care. For example, calibration using data from a field experiment suggests that omitting behavioral hazard leads to welfare estimates that can be both wrong in sign and off by an order of magnitude. Optimally designed insurance can thus increase health care efficiency as well as provide financial protection, suggesting the potential for market failure when private insurers are not fully incentivized to counteract behavioral biases.

****

6.3 Evidence on Private Plans

These results suggest that competitive forces do not lead to efficient equilibrium insurance contracts when insurees are naive about their biases, but that the insurer will have an incentive to counteract biases when this saves the insurer money. These results may shed light on why more health insurance plans do not incorporate behavioral hazard into their copayment structures. Recall the evidence from Table 2 (from full paper at link below), which summarizes the features of several major insurance plans. Co-payments are rarely a function of the health benefit associated with the care for a particular patient.

Nevertheless, insurers could increase profits by promoting adherence to medications and treatments that save money over a reasonably short horizon (relative to the typical tenure of their enrollees), and the model suggests that insurers will invest in encouraging care in such instances.

http://www.nber.org/papers/w18468.pdf

Comment:

By Don McCanne, MD

Moral hazard in health insurance is said to occur when patients obtain unnecessary care merely because they don’t have to pay for it. Requiring patients to pay for at least a portion of their care, through deductibles, co-payments and coinsurance, supposedly disincentivizes patients from obtaining such unnecessary care, but does so at the cost of patients declining care that is quite appropriate and should be obtained. This paper attempts to compensate for that by adding behavioral hazard to that of moral hazard when determining when and how much financial exposure patients should have when accessing care. If the behavior of patients might cause them to underuse care, then cost sharing should be adjusted downward accordingly.

That’s the theory. In practice it would greatly add to the administrative burden of private health care financing to try to identify not only each instance when a patient might be inclined to overuse care unnecessarily (moral hazard), but also each instance in which a patient might avoid beneficial care because of cost barriers (behavioral hazard), and then to modify the patient’s share of each cost entailed based on these economic hazards.

Current estimates on how much could be saved by avoiding moral hazard are flawed anyway, primarily because they ignore the deleterious effect of behavioral hazard. Yet private insurance products incorporate cost sharing that does ignore behavioral hazard, except in very limited instances such as preventive services or cost sharing for important maintenance drugs. Once you make the adjustments in cost sharing that would prevent most or all behavioral hazard, the savings would dramatically diminish and might even be totally offset by the costs of the administrative excesses.

The most effective way to prevent behavioral hazard is to remove all financial barriers to care. The moral hazard remaining does not even apply to the eighty percent of health care that is consumed by patients with greater needs who have long exceeded their deductibles and stop loss. It’s simply not worth applying cost sharing measures to the remaining twenty percent of care for those of us who are relatively healthy, when the resulting decrease in our total national health expenditures would be almost negligible.

Besides, who are all of these people who are demanding care that they simply do not need? Thinking back through my decades of family practice, no one individual comes to mind.

Health reform won’t shield Utah families from medical debt

Both Obama’s reform and challenger Romney’s plan leave families exposed to high out-of-pocket costs

By Kirsten Stewart
The Salt Lake Tribune, Oct. 21, 2012

Kiarah sits propped up on pillows, her tiny frame seeming to disappear in the sterile expanse of the hospital bed.

The 4-year-old is distracted for now by her Nintendo DS. She’s too young to remember the first two surgeries to rebuild her hip, the body casts and having to learn to walk again. “We try hard to insulate her, to make sure she doesn’t feel different from other kids,” said her mother, Sarah McCoy.

But the well-wishers and balloons will soon give way to months of rehabilitation and piles of medical bills.

Prior to Kiarah’s diagnosis with hip dysplasia, McCoy had no debt. Now, despite having better-than-average health insurance, mounting medical bills and related expenses have pushed the 28-year-old working mom to the brink of bankruptcy.

Medical debt is a common burden in America, shouldered not just by the poor and uninsured, but scores of fully insured, middle-class families. It’s a leading cause of bankruptcy and well-documented drag on the economy, which industry experts say is getting worse.

And it’s uncertain whether federal health reform will bring relief.

“It’s a problem that affects everyone but the extremely wealthy, a problem of the 99 percent. And it’s a matter of bad luck for the people who incur it,” said Mark Rukavina, a former consumer advocate and founder of the hospital advisory group, Community Health Advisors in Massachusetts.

The first hint of Kiarah’s hip dysplasia was the click a nurse heard while examining the newborn’s hips. But the family pediatrician couldn’t replicate the click and dismissed McCoy’s concerns, even 10 months later, when she complained her daughter was walking oddly.

After Kiarah’s first birthday, an orthopedic specialist confirmed Kiarah had hip dysplasia, said McCoy. “Her hip has never been in the socket, so no cup had developed. It was still the size as a newborn.”

The first two attempts to create a socket to grip her femur were only partially successful. Doctors at Primary Children’s Medical Center say prospects are better now that she and her bones are bigger, said McCoy.

Tapping patients’ pockets

The Affordable Care Act aims to reduce medical debt by insuring more people, thereby easing the charity-care burden on hospitals, which will have fewer losses to pass onto paying customers.

The law puts limits on what nonprofit hospitals can do to collect debts and puts new restrictions on insurers, which can no longer deny coverage to the sick or charge them more. Insurers can’t impose lifetime caps on coverage, and they have to spend more of the premiums they collect on actual medical care.

“Health reform will probably succeed at reducing many of the large bills,” said Rukavina. “But there will still be out-of-pocket costs that eat into people’s budgets.”

Indeed, the pioneering reform law in Massachusetts upon which federal reform was built may have kept debt in check, but it hasn’t solved it.

A survey of Bay State residents who filed bankruptcy in 2009 showed 53 percent blamed medical bills, down slightly from 59 percent in 2007 when the law wasn’t yet fully implemented, a study in the American Journal of Medicine showed. But the difference wasn’t statistically significant, the authors said.

The Blue Cross Blue Shield of Massachusetts Foundation reported in a 2010 survey that 1 in 5 adults were carrying medical debt and paying it down — statistically the same as in 2006.

Authors of both surveys blamed the high cost of U.S. medical care, which is rising faster than wages and inflation. Feeling squeezed, insurers are passing more of those costs onto consumers in the form of higher premiums, deductibles, co-payments and co-insurance — practices that neither President Obama’s health care law nor Mitt Romney’s health plan will limit.

Romney’s proposal to repeal the insurance mandate and turn Medicaid into a block grant could raise people’s out-of-pocket costs because, the Commonwealth Foundation predicts, it will increase the number of people who are uninsured. Romney also would provide smaller insurance subsidies to fewer people and steer more people to cheaper health plans that cover less.

“The trend has absolutely been toward increasing patient responsibility. It’s the least likely group to put up a fuss,” said Mark Rieger, a vice president at Gateway EDI, a St. Louis-based company that sells software to help doctors better manage their bills.

It used to be that no more than 9 to 10 percent of a physician’s income came directly from patients, he said. Now in some parts of the country it’s close to 20 to 30 percent.

‘It’s hard to climb out’

Still, health care providers “are only about 50 to 60 percent successful on collecting on patient responsibility,” Rieger said. As a result, clinics and hospitals have become less tolerant of past-due balances.

Days before Kiarah’s surgery, a clerk at Primary Children’s phoned McCoy to ask how she planned to pay for it.

“She said, ‘You’ve met your $700 deductible, but we estimate your portion of the bill will still be $4,000. And because you have an outstanding balance with us, we’ll need you to pay that up-front,’” said McCoy, who feared Kiarah would be denied surgery.

Instead, the nonprofit hospital put her on a payment plan. It routinely conveys the expected cost as patients preregister for care, said hospital spokeswoman Bonnie Midget. “Most families appreciate knowing up-front what their portion will be.”

McCoy is grateful for doctors at Primary and the hospital’s flexibility. A flight scheduler at Hill Air Force Base, she is the sole provider for Kiarah, her 10-year-old sister, Tiyah, and the girls’ father, Justin Adams, who is disabled.

But with every payment plan comes interest, and with each surgery, more bills and time off work.

“I’ve had my wages garnished to pay past premiums on my insurance for when I took unpaid leave. I’ve maxed out my credit cards to pay the rent and make car payments. My credit is shot, so I can’t take out a loan to consolidate my debt,” she said. “Once you’re in a hole, it’s hard to climb out.”

Creditors are now hounding her for more than $100,000.

‘The most common type of debt’

McCoy has hired a lawyer to sue the pediatrician who missed Kiarah’s dysplasia. But the case could take years to litigate. Her attorney has recommended that she file bankruptcy.

Data on how many bankruptcies in Utah are caused by medical debt are hard to come by.

But nearly 88 percent of a random sample of bankruptcy filings between 2003 and 2007 reported at least some medical debt, said Levi Pace, a doctoral candidate in economics at the University of Utah, who for his dissertation is researching the effects of changes to bankruptcy laws.

http://www.sltrib.com/sltrib/news/54935642-78/medical-debt-kiarah-mccoy.html.csp

Oregon lawmaker intends to keep single-payer movement alive next session

The Portland legislator is convinced that a single-payer health system is the most affordable and comprehensive option

By Diane Lund-Muzikant
The Lund Report (Portland, Ore.), Oct. 18, 2012

Despite the emphasis on health care transformation, evident by the $1.9 billion in federal funds that Governor John Kitzhaber garnered to implement coordinated care organizations, the single-payer movement isn’t dead in Oregon.

Its champion, Rep. Michael Dembrow (D-Portland) plans to re-introduce the same legislation again next February. In 2011, it received a hearing in the House but stalled there (House Bill 3510).

This time around, Dembrow has his eyes set on having public hearings in both the House and Senate health care committees.

“I don’t see transformation and single payer as being mutually exclusive, but complimentary,” Dembrow said. “The principles of coordinating care are very much the same with the single-payer philosophy – focusing on focusing on prevention and primary care including oral health and mental health as well as physical health.”

But Dembrow faces an uphill battle with his legislative colleagues, among them Rep., Tina Kotek (D-Portland) who said she applauded the conversation in 2011 but wants to let the dust settle on health reform before jumping on board.

“With the Affordable Care Act and the coordinated care organizations, we need to see how they work first. If they don’t work we’ll have to move to single payer because it’s an economic issue. People need access to health care, and my hope is that restructuring the Oregon Health Plan we can eventually impact and transform the entire private system. Let’s go there first.”

Rep. Bruce Hanna (R-Roseburg) said he’s never seen evidence showing that single payer is the best alternative. “Single payer takes away the competitive nature of providing health care. Anytime you eliminate competition, you increase costs, not decrease them.”

Nevertheless, Dembrow plowing ahead and insists that people have serious questions about the impact of the Affordable Care Act.

“It’s a move in the right direction but will still leave people without affordable coverage. Single payer is where we need to wind up as a country because it’s going be most affordable option. In principle, it will extend Medicare to all Oregonians and lead to lower administrative costs, less paperwork and be more comprehensive.”

Thousands of Oregonians favor a single-payer system, he believes. “They’re calling for us to move in this direction, and this legislation will create a focus for their organizing to keep this movement going.”

Next session, Dembrow’s also contemplating legislation that would call for a constitutional amendment saying health care is a fundamental right, an issue championed in the past by Rep. Mitch Greenlick (D-Portland). If successful, it would appear on the November 2014 ballot.

A rally being planned for the opening day of the session next February could draw support for such an amendment.

“If we do go forward with the constitutional referral, it’ll be kicked off then, but we’ll only go forward if I feel like there’s real potential for a statewide organization,” he said. “I don’t want to put this measure on the ballot unless I feel that proponents are willing to organize at the grassroots level to get it through.”

Dembrow realized the need for a single-payer system after the birth of his first child, who needed surgery when he was two weeks old. Both he and his wife were graduate students at the time, and the medical bill completely wiped out their savings. Four years later, his daughter was born in France, and Dembrow encountered the single-payer system firsthand. “All of our contributions came directly out of our paycheck; we had an excellent level of care without any kind of hardship or worry.”

Later, as president of the faculty union at Portland Community College, he saw the struggles that teachers faced who worked part-time and didn’t have access to health care. That led Dembrow to create a fund allowing these educators to be reimbursed for their insurance bills.

During his first stint in the legislature in 2009, he succeeded in passing legislation that allowed part-time faculty to combine their employment from multiple public colleges or universities and become eligible to purchase benefits from the Oregon Educators Benefit Board.

http://www.thelundreport.org/resource/dembrow_intends_to_keep_single_payer_movement_alive_next_session

Simple treatments: bad doctors or a bad health system?

By Josh Freeman, M.D.
Medicine and Social Justice blog, Oct. 20, 2012

The New York Times editorial on September 9, 2012, “Simple treatments ignored”, is a commentary on a report in the September 7 issue of the Centers for Disease Control and Prevention (CDC) publication Morbidity and Mortality Weekly Report (MMWR)  that many Americans with hypertension (high blood pressure) were not being adequately treated. The Times notes that the study “found that 67 million Americans had high blood pressure and that 31 million of them were being treated with medicines that reduced their blood pressure to a safe level. The remaining 36 million fell into three groups: people who were not aware of their hypertension, people who were aware but were not taking medication, and those who were aware and were treated with medication but still had hypertension.”

This is definitely not a good thing; hypertension is a serious disease that can have devastating results – most obviously in stroke, but also in increasing the risk of heart attack and kidney failure. Also, as the article states, treatment is relatively easy – that is to say, there are drugs that are available for effectively keeping hypertension under control. In fact, so many people are receiving effective treatment that the incidence of bad outcomes, such as stroke, has greatly decreased. The Times editorial, however, creates the impression that much or most of the fault of for lack of treatment is the result of ignorant, incompetent, uncareful (or uncaring) physicians; the reason, they write, is “…mostly because overburdened doctors did not give hypertension high priority.” This is a highly dubious assumption.

The editorial goes on to praise, specifically, the Kaiser Health System for doing a good job of controlling its patients’ blood pressure, and thus reducing the rate of strokes and heart attacks:  “The organization created a hypertension registry to track patients and the care they were getting; eased the burden on doctors by using pharmacists to initiate drug therapy and medical assistants to monitor patients’ progress; made it easy for patients to get free blood pressure checks; and showed doctors how their record on controlling blood pressure compared with others in the system.” This is great.

People should get treated effectively for treatable diseases, and hypertension is certainly one. There are, however, many reasons why they are not always treated, and this problem includes patient as well as provider issues. Hypertension is, on the whole, asymptomatic; it does not cause pain or weakness or even, usually, headaches; thus the sobriquet “silent killer”. The treatments, in addition to drugs, include things like “…weight loss, increased physical activity, lower sodium and alcohol consumption, and stress management,” which require significant effort and commitment on the part of the patient, and are not easy to do.

But, more important, the lessons of Kaiser are not easily translated into the rest of the health system. Kaiser is a very atypical in that it is a vertically-integrated, closed-panel health system. For starters, and it is a very important start, every patient in their panel is insured (though Kaiser) and every patient sees a Kaiser provider. Thus, they control both the coverage and direct care of this population, and they have a large enough scale to do outreach programs to encourage and support people in adopting and maintaining the behaviors listed above. This is, however, not the case for most of the community. Many people are not insured, and many others have insurance that does not cover drugs and other treatments. A variety of factors, some provider related (such as not being able to get an appointment) and others originating from patients’ own decisions (choosing to go to ERs and urgent care centers, and indeed “doctor shopping”), they see different providers. That the US has an uncoordinated health non-system is the key problem, not that “their doctors are asleep at the switch.”

The article concludes: “The benefits of reducing high blood pressure — not to mention the cost savings — are obvious. The wonder is that the health care system has done such a bad job of delivering those benefits.” To me the wonder is that we have tolerated not actually having a health system for as long as we have, and that health policy continues to try to address issues of quality of care while ignoring the elephants in the room: that so many people have no coverage or poor coverage, and that reimbursement overwhelmingly rewards intervening once problems have arisen rather than preventing them. That a physician hired by a hospital to inject clot-busters into the brain’s arteries to try to reverse a stroke that has already occurred earns, literally, several times as much as (and works much less than) a primary care physician who treats hypertension (and many other diseases). The reimbursement system is completely inequitable and inappropriate, and the health system is a sick hodge-podge of half measures.

First, we need a health insurance system that covers everyone: Medicare for all. Then we need to reward systems-based and outcomes-based care. Then maybe all of us can see results like Kaiser’s.

http://medicinesocialjustice.blogspot.com/2012/10/simple-treatments-bad-doctors-or-bad.html

George McGovern

What It Means to Be a Democrat

By George McGovern
Blue Rider Press, Penguin Group, 2011

Universal Health Care

In 2010, Barack Obama and the Democrats in Congress did an outstanding job in passing the Patient Protection and Affordable Care Act to make health insurance available for every American. The bill passed without a single Republican vote.

The law is being phased in over five years, but it already has eliminated some of the major shortcomings of the private insurance system. It has made health care coverage available to more children and young adults, ended lifetime limits on coverage, made more preventive services available at no cost, improved pharmaceutical coverage for seniors on Medicare, and provided tax credits to small businesses that insure their employees. The law also prohibits insurers from the heinous practice of denying coverage to children who have preexisting conditions, a provision that later will be extended to adults. It offers much-needed discipline to the insurance companies, which have called the shots for far too long.

But I think we should go further.

We should replace the 906-page bill, which I’m sure many lawmakers and most citizens haven’t read, with a seven word sentence that reads: “Congress hereby extends Medicare to all Americans.”

My firsthand experience with Medicare has convinced me that a Medicare-like plan, or single-payer system such as Canada enjoys, should apply to everyone, not just to old duffers like me.

http://www.amazon.com/What-Means-Democrat-George-McGovern/dp/B007F7QA5K

Comment:

By Don McCanne, MD

Electoral votes, 1972 Presidential election:

17 – George McGovern
520 – Richard Nixon

McGovern tried, and he never quit. We are all the better for it.