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Patients in poor health leave Medicare Advantage plans

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Patients in poor health leave Medicare Advantage plans

Medicare Advantage; CMS Should Use Data on Disenrollment and Beneficiary Health Status to Strengthen Oversight

United States Government Accountability Office (GAO), April 2017

If MAOs (Medicare Advantage Organizations) are meeting the needs of all their beneficiaries, we would expect that the rates at which beneficiaries disenroll would not vary by their health status. However, when beneficiaries in poor health are more likely to disenroll than those in better health—which we refer to as health-biased disenrollment—it may indicate that those beneficiaries could be facing problems with access to care or the quality of services provided. From an oversight perspective, contracts with health-biased disenrollment may not warrant extra CMS scrutiny if relatively few beneficiaries choose to leave the contract. However, contracts with both high overall rates of disenrollment and health-biased disenrollment may indicate potentially problematic contracts.

Conclusions

CMS is responsible for ensuring that all MA contracts offer care that meets applicable standards, regardless of beneficiary health status. However, as part of its routine oversight, CMS does not examine disenrollment rates by health status. Our analysis identified 35 contracts in 2014 where MA beneficiaries in poor health were more likely to disenroll than those in better health. These contracts with health-biased disenrollment had quality scores that were consistently and substantially below the scores of contracts without health-biased disenrollment. In addition, survey data indicate that beneficiaries who left these contracts reported problems with coverage of preferred doctors and hospitals as well as problems getting access to care as leading reasons they chose to leave their contracts. This type of information on disenrollment and beneficiary health status is available to CMS; however, by not leveraging it as part of its routine oversight of MA contracts, CMS is missing an opportunity to better target its oversight activities toward MA contracts that may not be adequately meeting the health care needs of all beneficiaries, particularly those in poor health.

https://www.gao.gov…

***

Comment:

By Don McCanne, M.D.

This GAO analysis shows that individuals enrolled in the private Medicare Advantage plans who were in poor health disenrolled at higher rates than those who were in better health. Reasons given included problems with coverage of their preferred doctors and hospitals (narrow networks) and problems getting access to care.

We know that private Medicare Advantage insurers game the system by selectively marketing to healthier patients and by upcoding to obtain higher risk adjustment payments. Although not discussed in this report, the exodus of patients in poor health could well represent intentional delivery of inferior services in an effort to encourage higher cost patients to leave.

This analysis also showed that healthier patients who left plans did so because of the cost of care, frequently switching to plans with lower costs.

This is how markets work. Healthy patients shop lower prices whereas patients with health care needs leave plans because of poor service. Is that really the way we want our health care system to work? Or would we prefer a system with greater choice in our health care professionals and institutions that strive more to bring us the health care that we truly need? A well designed single payer system would bring us the latter.

Stay informed! Visit www.pnhp.org/qotd to sign up for daily email updates.

Patients in poor health leave Medicare Advantage plans

Medicare Advantage; CMS Should Use Data on Disenrollment and Beneficiary Health Status to Strengthen Oversight

United States Government Accountability Office (GAO), April 2017

If MAOs (Medicare Advantage Organizations) are meeting the needs of all their beneficiaries, we would expect that the rates at which beneficiaries disenroll would not vary by their health status. However, when beneficiaries in poor health are more likely to disenroll than those in better health—which we refer to as health-biased disenrollment—it may indicate that those beneficiaries could be facing problems with access to care or the quality of services provided. From an oversight perspective, contracts with health-biased disenrollment may not warrant extra CMS scrutiny if relatively few beneficiaries choose to leave the contract. However, contracts with both high overall rates of disenrollment and health-biased disenrollment may indicate potentially problematic contracts.

Conclusions

CMS is responsible for ensuring that all MA contracts offer care that meets applicable standards, regardless of beneficiary health status. However, as part of its routine oversight, CMS does not examine disenrollment rates by health status. Our analysis identified 35 contracts in 2014 where MA beneficiaries in poor health were more likely to disenroll than those in better health. These contracts with health-biased disenrollment had quality scores that were consistently and substantially below the scores of contracts without health-biased disenrollment. In addition, survey data indicate that beneficiaries who left these contracts reported problems with coverage of preferred doctors and hospitals as well as problems getting access to care as leading reasons they chose to leave their contracts. This type of information on disenrollment and beneficiary health status is available to CMS; however, by not leveraging it as part of its routine oversight of MA contracts, CMS is missing an opportunity to better target its oversight activities toward MA contracts that may not be adequately meeting the health care needs of all beneficiaries, particularly those in poor health.

https://www.gao.gov…

***

Comment:

By Don McCanne, M.D.

This GAO analysis shows that individuals enrolled in the private Medicare Advantage plans who were in poor health disenrolled at higher rates than those who were in better health. Reasons given included problems with coverage of their preferred doctors and hospitals (narrow networks) and problems getting access to care.

We know that private Medicare Advantage insurers game the system by selectively marketing to healthier patients and by upcoding to obtain higher risk adjustment payments. Although not discussed in this report, the exodus of patients in poor health could well represent intentional delivery of inferior services in an effort to encourage higher cost patients to leave.

This analysis also showed that healthier patients who left plans did so because of the cost of care, frequently switching to plans with lower costs.

This is how markets work. Healthy patients shop lower prices whereas patients with health care needs leave plans because of poor service. Is that really the way we want our health care system to work? Or would we prefer a system with greater choice in our health care professionals and institutions that strive more to bring us the health care that we truly need? A well designed single payer system would bring us the latter.

Stay informed! Visit www.pnhp.org/qotd to sign up for daily email updates.

Dr. Margaret Flowers on ‘Washington Journal’

PNHP board adviser Dr. Margaret Flowers appeared on the C-SPAN program “Washington Journal” on July 10, 2017, to discuss the feasibility of single-payer reform in the U.S. She was joined by Michael Tanner of the Cato Institute, and presented the case for improved Medicare for all, including comprehensive coverage and greater efficiency.

Private Medicare Advantage plans associated with greater racial disparity

Medicare Advantage Associated With More Racial Disparity Than Traditional Medicare For Hospital Readmissions

By Yue Li, Xi Cen, Xueya Cai, Caroline P. Thirukumaran, Jie Zhou and Laurent G. Glance
Health Affairs, July 2017

Abstract

We compared racial disparities in thirty-day readmissions between traditional Medicare and Medicare Advantage beneficiaries who underwent one of six major surgeries in New York State in 2013. We found that Medicare Advantage was associated with greater racial disparity, compared to traditional Medicare. After controlling for patient, hospital, and geographic characteristics in a propensity score based approach, we found that in traditional Medicare, black patients were 33 percent more likely than white patients to be readmitted, whereas in Medicare Advantage, black patients were 64 percent more likely than white patients to be readmitted. Our findings suggest that the risk-reduction strategies adopted by Medicare Advantage plans have not been successful in lowering the markedly higher rate of readmission among black patients, compared to white patients.

http://content.healthaffairs.org…

***

Comment:

By Don McCanne, M.D.

There are many reasons for racial disparities in health care, and they are all bad, but some are worse than others.

In this study hospital readmissions within thirty days of undergoing any one of six major surgeries were greater in black Medicare patients than in white patients. However, the disparities were much higher in privately insured Medicare Advantage patients than they were in patients enrolled in the traditional Medicare program. Efforts must be directed to identifying and correcting the reasons for these disparities in all Medicare patients, but special attention should be given to those in the private Medicare Advantage plans, especially considering the greater prevalence of the problem.

Taxpayers are paying more for patient care in the private Medicare Advantage plans than they are for patients in the traditional Medicare program. The private insurance industry claims that they are providing greater value for that spending through higher quality care that is better coordinated, including better post-discharge followup care. However, this study shows that black patients are receiving worse followup care, resulting in higher readmission rates.

This particular disparity in care seems to be one of the worst since it combines the problematic background of disparities in care with the somewhat nefarious managed care techniques of the private insurance industry that are based more on greater profits (greed) than on their professed higher quality care. The private insurers are providing lower quality care at a higher cost – the exact opposite of what they claim.

The authors of this report conclude, “Further research is needed to understand whether newer health care delivery models, such as accountable care organizations, will help narrow the gap in readmission outcomes between black and white patients.” No. With this and a multitude of other studies, we have enough data already to warrant dismissing the private Medicare Advantage plans. Instead, we need to fix the traditional Medicare program, converting it into a model that would be ideal to expand to include everyone. That fix certainly should include addressing all of the reasons for racial disparities in care.

Stay informed! Visit www.pnhp.org/qotd to sign up for daily email updates.

Three Doctors on What Works and Doesn’t Work in U.S. Health Care

By Scott Simon
NPR Weekend Edition, July 8, 2017

Doctors Julie Gunter, Rob Stone and Gary Sobelson talk with Scott Simon about the problems with American health care and what they think of the current Republican health care plan.

TRANSCRIPT

SCOTT SIMON, HOST: The United States spends about $9,000 per person per year on health care, the highest in the world. But our life expectancy is still lower than France, Switzerland, Japan, the United Kingdom, all of which spend less. With the Republican health care bill still on the Senate docket, we thought it would be a good time to hear from U.S. doctors. We have three with us now, Dr. Julie Gunther, a family doctor in Idaho, Rob Stone, an ER turned palliative care doctor in Indiana, and Dr. Gary Sobelson, a primary care doctor in New Hampshire. Thanks so much for being with us.

GARY SOBELSON: Thank you.

ROB STONE: Thank you.

JULIE GUNTHER: Thank you.

SIMON: Let me begin, if we can, with you, Dr. Gary Sobelson there in New Hampshire. Seven years since the Affordable Care Act – three since most of the changes went into effect. How is health care different? Is it better, worse?

SOBELSON: Much better coverage for our patients, particularly, in my case as a family doctor, for the working poor. I have people coming in for preventive services, for hypertension management, for cardiovascular disease prevention, for cancer screening who really had not been coming in except for the most acute needs. And that’s been meaningfully different.

SIMON: Dr. Rob Stone in Indiana, you were an ER doctor. You must have seen patients who who came to the ER because they didn’t have insurance to cover primary care visits. Has that changed under the Affordable Care Act for you?

STONE: It’s changed very noticeably. And a far smaller percentage of people are coming in uninsured, although we still continue to take care of those folks, too. Our hospital’s also affiliated with some very small-town hospitals in Bedford, Ind., Paoli, Ind. And in those areas in particular, I think the Medicaid expansion part of the Affordable Care Act has helped to solidify the financial standing of those hospitals, which was somewhat questionable earlier.

So I would say that’s all good. The downside – and this started before the Affordable Care Act – before Obamacare – is that co-pays and deductibles and premiums keep going up for the people who aren’t on Medicaid. And so people coming into the ER find themselves underinsured too often when they realize they can’t afford their co-pays or their deductibles.

SIMON: Dr. Julie Gunther, you’re a family doctor in Idaho. And I gather you’ve kind of opted out of the typical model and you have your own direct primary care practice.

GUNTHER: Yes, I have. I was a system-employed outpatient physician until 2014. And then I left and started a solo, independent, cash-based practice. So I no longer bill insurance.

SIMON: And why did you take that step?

GUNTHER: The simple answer is I had to leave the system to save myself to be the doctor I wanted to be. It’s valuable for me to hear Dr. Sobelson and Dr. Stone’s experiences. My experience was very, very different. Even before the Affordable Care Act – but especially after – the progressive amount of regulations made it almost impossible for me to serve people the way I was originally called to serve them as an outpatient family doctor.

And so I have built a rather successful cash-based practice that charges very, very little per month. The majority of my patients are either uninsured, underinsured or so frustrated with the current system and its barriers that they would rather pay a small amount out of pocket every month for more direct care.

SIMON: Well – and so I’m going to bring Dr. Rob Stone into this conversation because I’ve been told you’re an advocate for a single-payer system. Is Dr. Gunther onto something?

STONE: Well, I don’t know how generalizable it is widely – and particularly not to very poor areas like the inner city. But my feeling is that we have a good model for how to take care of everybody, which some people still think is kind of a pie-in-the-sky dream. But I’m still going to push for it. And I think that is expanding Medicare, which already takes care of everybody over 65. And I happened to turn 65 a couple months ago. And I’m on Medicare now. And I’m pretty happy with that.

SIMON: Dr. Gary Sobelson, are the high costs of health care unavoidable? Can’t we, after all, just do more for people – a lot more – than we could even 10 and 20 years ago?

SOBELSON: While there are many things that we can do, the high costs are things that the system itself brings about. We’ve designed a system that rewards high-reimbursement procedures, surgeries and undervalues the things that are cost-effective. And it doesn’t really matter how much we research this or prove this to ourselves within our profession. We don’t seem to move in that direction. We don’t have the political will.

Dr. Stone’s comments about Medicare for all are not isolated to small groups of the population. We’ve studied this in New Hampshire, and over 80 percent of our primary care physicians are in favor of a system that some would call single-payer – and the majority of our overall doctors, even including specialists. And that’s been replicated across the country, too. We as Americans seem to value our independent decision-making over collective wisdom, though I would argue that when simple procedures like common arthroscopic knee surgery, something that takes 15 to 30 minutes, is costing $15,000 to $25,000 in community hospitals around our country – that no one has the freedom to make that decision.

GUNTHER: I was just going to say I normally talk about a single payer system. And we use Medicare as a model. My patients who have Medicare say that it works. My mother and father who are economically well off pay $150 a month towards their health care. My Americans who are age 30 to 60 are dropping their health care plans. And they come in, and they tell me, I can choose between putting food on the table, paying for my kid to go to college or getting a health plan that I can’t afford.

So it’s not that I oppose a broader solution. But I would contend we have a system that is completely crumbling and unsustainable. And in my opinion and experience, I don’t think Medicare is working all that well, especially not in a way that we could roll it out to our whole country in any sort of sustainable way. And the heart of it in my opinion is we talk a lot about who’s going to pay for health care. But what we should be talking about is the price of health care.

SIMON: Do we have an unrealistic expectation that health care costs can be reduced when we expect health care to do more and more?

GUNTHER: I think there’s great examples that current health care prices are upwards of a thousand times more than anywhere close to true cost. My patients can get a CAT scan – cash price for $300. If they go into the local ER, it’ll bill out at $2,400. So I think we need to start asking why. Because we keep talking about who should pay or how we should pay for health care.

But if we allow free market forces and competition to create price transparency, then we start to have the opportunity for price control, cost control. And then I think we can completely change the dialogue from who should pay and how should we pay too to what parts of health care do people need help paying for.

SOBELSON: I think Dr. Gunther is describing the problems that we’ve created by more or less – and this is a failing of the ACA – allowing corporate profitability to be the driving force of how we set these so. So, again, if you’re not under Medicare or Medicaid in this country, you’re depending on a private insurance industry to somehow control costs, when, in fact, it’s not really in their interest. They don’t have skin in the game here.

They make their profitability based on how much they collect in revenue. And, in fact, it’s written into the law. So, again, it’s not surprising that we’ve created a model where, in fact, more spending will be encouraged, not discouraged because the only people who really would care about it would be the consumers. And they don’t seem to believe that they can control it.

SIMON: Let me ask this finally, if I could. The Senate bill that’s under consideration right now may or may not be going anywhere. Could each of you give us one idea that you would like to see the government adopt that could improve health care in this country? – or not just the government. What can we do?

STONE: Well, I would say first that the Senate bill is a terrible thing that would set us back and would cost lives. And the people who would be hurt the worst would be children, the disabled and the elderly and nursing homes because of the ravages to Medicaid. So the first thing I would do would be, say, save Medicaid and continue to expand it. And then the second biggest problem in the Senate bill is that it would make health care very expensive for people ages 50 to 65 or 55 to 65 – would be to think about lowering the age of Medicare eligibility to, say, 55 and not cut those people out into the cold.

SIMON: That’s Dr. Rob Stone in Indiana. Dr. Julie Gunther, what would you suggest?

GUNTHER: I would agree with Dr. Stone. I don’t think the Senate bill provides the improvements to the Affordable Care Act or some of our biggest health care problems that we need. If I had one ask it would be that we allow consumers – we allow patients who do have health savings accounts to use those health savings dollars to pay their physician, whether it’s a periodic fee or a direct payment.

And one of my favorite quotes about health care in our country is that we continue to tape wings on a car and call it an airplane. I think we have to radically transform the system at its core if we hope to end up in a different place.

SIMON: And Dr. Gary Sobelson.

SOBELSON: Yeah. From my perspective in New Hampshire, I think the damages to Medicaid that the Senate bill would bring about would be devastating to us and take back so much positive progress we’ve had in terms of access and cost containment.

And if I had to add one thing to it, I think Dr. Stone’s idea of expanding Medicare to populations that traditionally have a hard time buying insurance could be extended into the whole idea of the ability of a public option, the ability of the Medicare and Medicaid programs to work out ways to compete with private insurers so that the public could become more comfortable with them.

SIMON: Doctors Rob Stone, Julie Gunther and Gary Sobelson, thanks so much for joining us.

GUNTHER: Thank you.

STONE: Thank you.

SOBELSON: Thank you.

http://www.npr.org…

Three Doctors on What Works and Doesn’t Work in U.S. Health Care

By Scott Simon
NPR Weekend Edition, July 8, 2017

Doctors Julie Gunter, Rob Stone and Gary Sobelson talk with Scott Simon about the problems with American health care and what they think of the current Republican health care plan.

TRANSCRIPT

SCOTT SIMON, HOST: The United States spends about $9,000 per person per year on health care, the highest in the world. But our life expectancy is still lower than France, Switzerland, Japan, the United Kingdom, all of which spend less. With the Republican health care bill still on the Senate docket, we thought it would be a good time to hear from U.S. doctors. We have three with us now, Dr. Julie Gunther, a family doctor in Idaho, Rob Stone, an ER turned palliative care doctor in Indiana, and Dr. Gary Sobelson, a primary care doctor in New Hampshire. Thanks so much for being with us.

GARY SOBELSON: Thank you.

ROB STONE: Thank you.

JULIE GUNTHER: Thank you.

SIMON: Let me begin, if we can, with you, Dr. Gary Sobelson there in New Hampshire. Seven years since the Affordable Care Act – three since most of the changes went into effect. How is health care different? Is it better, worse?

SOBELSON: Much better coverage for our patients, particularly, in my case as a family doctor, for the working poor. I have people coming in for preventive services, for hypertension management, for cardiovascular disease prevention, for cancer screening who really had not been coming in except for the most acute needs. And that’s been meaningfully different.

SIMON: Dr. Rob Stone in Indiana, you were an ER doctor. You must have seen patients who who came to the ER because they didn’t have insurance to cover primary care visits. Has that changed under the Affordable Care Act for you?

STONE: It’s changed very noticeably. And a far smaller percentage of people are coming in uninsured, although we still continue to take care of those folks, too. Our hospital’s also affiliated with some very small-town hospitals in Bedford, Ind., Paoli, Ind. And in those areas in particular, I think the Medicaid expansion part of the Affordable Care Act has helped to solidify the financial standing of those hospitals, which was somewhat questionable earlier.

So I would say that’s all good. The downside – and this started before the Affordable Care Act – before Obamacare – is that co-pays and deductibles and premiums keep going up for the people who aren’t on Medicaid. And so people coming into the ER find themselves underinsured too often when they realize they can’t afford their co-pays or their deductibles.

SIMON: Dr. Julie Gunther, you’re a family doctor in Idaho. And I gather you’ve kind of opted out of the typical model and you have your own direct primary care practice.

GUNTHER: Yes, I have. I was a system-employed outpatient physician until 2014. And then I left and started a solo, independent, cash-based practice. So I no longer bill insurance.

SIMON: And why did you take that step?

GUNTHER: The simple answer is I had to leave the system to save myself to be the doctor I wanted to be. It’s valuable for me to hear Dr. Sobelson and Dr. Stone’s experiences. My experience was very, very different. Even before the Affordable Care Act – but especially after – the progressive amount of regulations made it almost impossible for me to serve people the way I was originally called to serve them as an outpatient family doctor.

And so I have built a rather successful cash-based practice that charges very, very little per month. The majority of my patients are either uninsured, underinsured or so frustrated with the current system and its barriers that they would rather pay a small amount out of pocket every month for more direct care.

SIMON: Well – and so I’m going to bring Dr. Rob Stone into this conversation because I’ve been told you’re an advocate for a single-payer system. Is Dr. Gunther onto something?

STONE: Well, I don’t know how generalizable it is widely – and particularly not to very poor areas like the inner city. But my feeling is that we have a good model for how to take care of everybody, which some people still think is kind of a pie-in-the-sky dream. But I’m still going to push for it. And I think that is expanding Medicare, which already takes care of everybody over 65. And I happened to turn 65 a couple months ago. And I’m on Medicare now. And I’m pretty happy with that.

SIMON: Dr. Gary Sobelson, are the high costs of health care unavoidable? Can’t we, after all, just do more for people – a lot more – than we could even 10 and 20 years ago?

SOBELSON: While there are many things that we can do, the high costs are things that the system itself brings about. We’ve designed a system that rewards high-reimbursement procedures, surgeries and undervalues the things that are cost-effective. And it doesn’t really matter how much we research this or prove this to ourselves within our profession. We don’t seem to move in that direction. We don’t have the political will.

Dr. Stone’s comments about Medicare for all are not isolated to small groups of the population. We’ve studied this in New Hampshire, and over 80 percent of our primary care physicians are in favor of a system that some would call single-payer – and the majority of our overall doctors, even including specialists. And that’s been replicated across the country, too. We as Americans seem to value our independent decision-making over collective wisdom, though I would argue that when simple procedures like common arthroscopic knee surgery, something that takes 15 to 30 minutes, is costing $15,000 to $25,000 in community hospitals around our country – that no one has the freedom to make that decision.

GUNTHER: I was just going to say I normally talk about a single payer system. And we use Medicare as a model. My patients who have Medicare say that it works. My mother and father who are economically well off pay $150 a month towards their health care. My Americans who are age 30 to 60 are dropping their health care plans. And they come in, and they tell me, I can choose between putting food on the table, paying for my kid to go to college or getting a health plan that I can’t afford.

So it’s not that I oppose a broader solution. But I would contend we have a system that is completely crumbling and unsustainable. And in my opinion and experience, I don’t think Medicare is working all that well, especially not in a way that we could roll it out to our whole country in any sort of sustainable way. And the heart of it in my opinion is we talk a lot about who’s going to pay for health care. But what we should be talking about is the price of health care.

SIMON: Do we have an unrealistic expectation that health care costs can be reduced when we expect health care to do more and more?

GUNTHER: I think there’s great examples that current health care prices are upwards of a thousand times more than anywhere close to true cost. My patients can get a CAT scan – cash price for $300. If they go into the local ER, it’ll bill out at $2,400. So I think we need to start asking why. Because we keep talking about who should pay or how we should pay for health care.

But if we allow free market forces and competition to create price transparency, then we start to have the opportunity for price control, cost control. And then I think we can completely change the dialogue from who should pay and how should we pay too to what parts of health care do people need help paying for.

SOBELSON: I think Dr. Gunther is describing the problems that we’ve created by more or less – and this is a failing of the ACA – allowing corporate profitability to be the driving force of how we set these so. So, again, if you’re not under Medicare or Medicaid in this country, you’re depending on a private insurance industry to somehow control costs, when, in fact, it’s not really in their interest. They don’t have skin in the game here.

They make their profitability based on how much they collect in revenue. And, in fact, it’s written into the law. So, again, it’s not surprising that we’ve created a model where, in fact, more spending will be encouraged, not discouraged because the only people who really would care about it would be the consumers. And they don’t seem to believe that they can control it.

SIMON: Let me ask this finally, if I could. The Senate bill that’s under consideration right now may or may not be going anywhere. Could each of you give us one idea that you would like to see the government adopt that could improve health care in this country? – or not just the government. What can we do?

STONE: Well, I would say first that the Senate bill is a terrible thing that would set us back and would cost lives. And the people who would be hurt the worst would be children, the disabled and the elderly and nursing homes because of the ravages to Medicaid. So the first thing I would do would be, say, save Medicaid and continue to expand it. And then the second biggest problem in the Senate bill is that it would make health care very expensive for people ages 50 to 65 or 55 to 65 – would be to think about lowering the age of Medicare eligibility to, say, 55 and not cut those people out into the cold.

SIMON: That’s Dr. Rob Stone in Indiana. Dr. Julie Gunther, what would you suggest?

GUNTHER: I would agree with Dr. Stone. I don’t think the Senate bill provides the improvements to the Affordable Care Act or some of our biggest health care problems that we need. If I had one ask it would be that we allow consumers – we allow patients who do have health savings accounts to use those health savings dollars to pay their physician, whether it’s a periodic fee or a direct payment.

And one of my favorite quotes about health care in our country is that we continue to tape wings on a car and call it an airplane. I think we have to radically transform the system at its core if we hope to end up in a different place.

SIMON: And Dr. Gary Sobelson.

SOBELSON: Yeah. From my perspective in New Hampshire, I think the damages to Medicaid that the Senate bill would bring about would be devastating to us and take back so much positive progress we’ve had in terms of access and cost containment.

And if I had to add one thing to it, I think Dr. Stone’s idea of expanding Medicare to populations that traditionally have a hard time buying insurance could be extended into the whole idea of the ability of a public option, the ability of the Medicare and Medicaid programs to work out ways to compete with private insurers so that the public could become more comfortable with them.

SIMON: Doctors Rob Stone, Julie Gunther and Gary Sobelson, thanks so much for joining us.

GUNTHER: Thank you.

STONE: Thank you.

SOBELSON: Thank you.

http://www.npr.org…

Why Single-Payer Health Care Saves Money

By Robert H. Frank
The New York Times, July 7, 2017

Lingering uncertainty about the fate of the Affordable Care Act has spurred the California legislature to consider adoption of a statewide single-payer health care system.

Sometimes described as Medicare for all, single-payer is a system in which a public agency handles health care financing while the delivery of care remains largely in private hands.

Discussions of the California measure have stalled, however, in the wake of preliminary estimates pegging the cost of the program as greater than the entire state government budget. Similar cost concerns derailed single-payer proposals in Colorado and Vermont.

Voters need to understand that this cost objection is specious. That’s because, as experience in many countries has demonstrated, the total cost of providing health coverage under the single-payer approach is actually substantially lower than under the current system in the United States. It is a bedrock economic principle that if we can find a way to do something more efficiently, it’s possible for everyone to come out ahead.

By analogy, suppose that your state’s government took over road maintenance from the county governments within it, in the process reducing total maintenance costs by 30 percent. Your state taxes would obviously have to go up under this arrangement.

But if roads would be as well maintained as before, would that be a reason to oppose the move? Clearly not, since the resulting cost savings would reduce your county taxes by more than your state taxes went up. Likewise, it makes no sense to oppose single-payer on the grounds that it would require additional tax revenue. In each case, the resulting gains in efficiency would leave you with greater effective purchasing power than before.

Total costs are lower under single-payer systems for several reasons. One is that administrative costs average only about 2 percent of total expenses under a single-payer program like Medicare, less than one-sixth the corresponding percentage for many private insurers. Single-payer systems also spend virtually nothing on competitive advertising, which can account for more than 15 percent of total expenses for private insurers.

The most important source of cost savings under single-payer is that large government entities are able to negotiate much more favorable terms with service providers. In 2012, for example, the average cost of coronary bypass surgery was more than $73,000 in the United States but less than $23,000 in France.

Despite this evidence, respected commentators continue to cite costs as a reason to doubt that single-payer can succeed in the United States. A recent Washington Post editorial, for example, ominously predicted that budget realities would dampen enthusiasm for single-payer, noting that the per capita expenditures under existing single-payer programs in the United States were much higher than those in other countries.

But this comparison is misleading. In most other countries, single-payer covers the whole population, most of which has only minimal health needs. In contrast, single-payer components of the United States system disproportionately cover population subgroups with the heaviest medical needs: older people (Medicare), the poor and disabled (Medicaid) and returned service personnel (Department of Veterans Affairs).

In short, the evidence is clear that single-payer delivers quality care at significantly lower cost than the current American hybrid system. It thus makes no sense to reject single-payer on the grounds that it would require higher tax revenues. That’s true, of course, but it’s an irrelevant objection.

In addition to being far cheaper, single-payer would also defuse the powerful political objections to the Affordable Care Act’s participation mandate. Polls consistently show that large majorities want people with pre-existing conditions to be able to obtain health coverage at affordable rates. But that goal cannot be achieved unless healthy people are required to join the insured pool. Officials in the Obama administration tried, largely in vain, to explain why the program’s insurance exchanges would collapse in the absence of the participation mandate.

But the logic of the underlying argument is actually very simple. Most people seem able to grasp it if you ask them what would happen if the government required companies to sell fire insurance at affordable rates to people whose houses had already burned down.

No home insurer could remain in business if each policy it sold required it to replace a house costing several hundred thousand dollars. Similarly, no health insurer could remain in business if each of its policy holders generated many thousands of dollars in health care reimbursements each month.

That’s why the lack of a mandate in the alternative plans under consideration means that millions of people with pre-existing conditions will become uninsurable if repeal efforts are successful. An underappreciated advantage of the single-payer approach is that it sidesteps the mandate objection by paying to cover everyone out of tax revenue.

Of course, having to pay taxes is itself a mandate of a sort, but it’s one the electorate has largely come to terms with. Apart from fringe groups that denounce all taxation as theft, most people understand that our entire system would collapse if tax payments were purely voluntary.

The Affordable Care Act is an inefficient system that was adopted only because its architects believed, plausibly, that the more efficient single-payer approach would not be politically achievable in 2009. But single-payer now enjoys significantly higher support than it did then, and is actually strongly favored by voters in some states.

Solid majorities nationwide now favor expansion of the existing single-payer elements of our current system, such as Medicare and Medicaid. Medicaid cuts proposed in Congress have been roundly criticized. Perhaps it’s time to go further: Individual states and, eventually, the entire country, can save money and improve services by embracing single-payer health care.

https://www.nytimes.com…

Why Single-Payer Health Care Saves Money

By Robert H. Frank
The New York Times, July 7, 2017

Lingering uncertainty about the fate of the Affordable Care Act has spurred the California legislature to consider adoption of a statewide single-payer health care system.

Sometimes described as Medicare for all, single-payer is a system in which a public agency handles health care financing while the delivery of care remains largely in private hands.

Discussions of the California measure have stalled, however, in the wake of preliminary estimates pegging the cost of the program as greater than the entire state government budget. Similar cost concerns derailed single-payer proposals in Colorado and Vermont.

Voters need to understand that this cost objection is specious. That’s because, as experience in many countries has demonstrated, the total cost of providing health coverage under the single-payer approach is actually substantially lower than under the current system in the United States. It is a bedrock economic principle that if we can find a way to do something more efficiently, it’s possible for everyone to come out ahead.

By analogy, suppose that your state’s government took over road maintenance from the county governments within it, in the process reducing total maintenance costs by 30 percent. Your state taxes would obviously have to go up under this arrangement.

But if roads would be as well maintained as before, would that be a reason to oppose the move? Clearly not, since the resulting cost savings would reduce your county taxes by more than your state taxes went up. Likewise, it makes no sense to oppose single-payer on the grounds that it would require additional tax revenue. In each case, the resulting gains in efficiency would leave you with greater effective purchasing power than before.

Total costs are lower under single-payer systems for several reasons. One is that administrative costs average only about 2 percent of total expenses under a single-payer program like Medicare, less than one-sixth the corresponding percentage for many private insurers. Single-payer systems also spend virtually nothing on competitive advertising, which can account for more than 15 percent of total expenses for private insurers.

The most important source of cost savings under single-payer is that large government entities are able to negotiate much more favorable terms with service providers. In 2012, for example, the average cost of coronary bypass surgery was more than $73,000 in the United States but less than $23,000 in France.

Despite this evidence, respected commentators continue to cite costs as a reason to doubt that single-payer can succeed in the United States. A recent Washington Post editorial, for example, ominously predicted that budget realities would dampen enthusiasm for single-payer, noting that the per capita expenditures under existing single-payer programs in the United States were much higher than those in other countries.

But this comparison is misleading. In most other countries, single-payer covers the whole population, most of which has only minimal health needs. In contrast, single-payer components of the United States system disproportionately cover population subgroups with the heaviest medical needs: older people (Medicare), the poor and disabled (Medicaid) and returned service personnel (Department of Veterans Affairs).

In short, the evidence is clear that single-payer delivers quality care at significantly lower cost than the current American hybrid system. It thus makes no sense to reject single-payer on the grounds that it would require higher tax revenues. That’s true, of course, but it’s an irrelevant objection.

In addition to being far cheaper, single-payer would also defuse the powerful political objections to the Affordable Care Act’s participation mandate. Polls consistently show that large majorities want people with pre-existing conditions to be able to obtain health coverage at affordable rates. But that goal cannot be achieved unless healthy people are required to join the insured pool. Officials in the Obama administration tried, largely in vain, to explain why the program’s insurance exchanges would collapse in the absence of the participation mandate.

But the logic of the underlying argument is actually very simple. Most people seem able to grasp it if you ask them what would happen if the government required companies to sell fire insurance at affordable rates to people whose houses had already burned down.

No home insurer could remain in business if each policy it sold required it to replace a house costing several hundred thousand dollars. Similarly, no health insurer could remain in business if each of its policy holders generated many thousands of dollars in health care reimbursements each month.

That’s why the lack of a mandate in the alternative plans under consideration means that millions of people with pre-existing conditions will become uninsurable if repeal efforts are successful. An underappreciated advantage of the single-payer approach is that it sidesteps the mandate objection by paying to cover everyone out of tax revenue.

Of course, having to pay taxes is itself a mandate of a sort, but it’s one the electorate has largely come to terms with. Apart from fringe groups that denounce all taxation as theft, most people understand that our entire system would collapse if tax payments were purely voluntary.

The Affordable Care Act is an inefficient system that was adopted only because its architects believed, plausibly, that the more efficient single-payer approach would not be politically achievable in 2009. But single-payer now enjoys significantly higher support than it did then, and is actually strongly favored by voters in some states.

Solid majorities nationwide now favor expansion of the existing single-payer elements of our current system, such as Medicare and Medicaid. Medicaid cuts proposed in Congress have been roundly criticized. Perhaps it’s time to go further: Individual states and, eventually, the entire country, can save money and improve services by embracing single-payer health care.

https://www.nytimes.com…

A health care solution is on the table

By Ahmed C.K. Kutty, M.D.
Concord Monitor, July 7, 2017

With the turmoil surrounding the current healthcare bill in the Senate, a solution hiding in plain sight deserves every concerned American’s attention.

Medicare For All fits the bill as a worthy replacement for the much maligned Affordable Care Act.

Having been around for 52 years, Medicare is familiar and popular, efficient with an overhead of 3 percent, contrasted with 30 percent in the private sector plans, and is available to all seniors and the disabled, regardless of economic status.’

Medicare for All will be eminently affordable with savings of $500 billion predicted, from $3.4 trillion that is the current health care tab for the whole country. Financed publicly. No premiums, deductibles and copays will be due at the point of care. Delivery will remain largely private, as under the current system.

The time is now for an improved Medicare to be expanded to cover all 320 million of us in a single national risk pool.

Did Winston Churchill know something about our national character we did not when he remarked: “Americans can be counted on to do the right thing after they have tried all else.”?

http://www.concordmonitor.com…

A health care solution is on the table

By Ahmed C.K. Kutty, M.D.
Concord Monitor, July 7, 2017

With the turmoil surrounding the current healthcare bill in the Senate, a solution hiding in plain sight deserves every concerned American’s attention.

Medicare For All fits the bill as a worthy replacement for the much maligned Affordable Care Act.

Having been around for 52 years, Medicare is familiar and popular, efficient with an overhead of 3 percent, contrasted with 30 percent in the private sector plans, and is available to all seniors and the disabled, regardless of economic status.’

Medicare for All will be eminently affordable with savings of $500 billion predicted, from $3.4 trillion that is the current health care tab for the whole country. Financed publicly. No premiums, deductibles and copays will be due at the point of care. Delivery will remain largely private, as under the current system.

The time is now for an improved Medicare to be expanded to cover all 320 million of us in a single national risk pool.

Did Winston Churchill know something about our national character we did not when he remarked: “Americans can be counted on to do the right thing after they have tried all else.”?

http://www.concordmonitor.com…

Michael Lighty explains the waiver process proposed for a California single payer system

Policy Rant: CA SB 562 and Federal Waivers

By Michael Lighty
Medium, July 6, 2017

Skeptics of SB 562, the California single-payer bill, latch onto the question of obtaining federal waivers to help fund the new Healthy California Trust Fund, an independent public authority created by SB562 that will guarantee healthcare to all Californians thru single-payer financing. But these skeptics fail to recognize the political, statutory and legal paths available to ensure the new system receives all the federal funds for which Californians are eligible.

Through on-going consultations with advocates, administrators, legal authorities and health policy analysts, the sponsor of SB 562 is preparing for how the new system can build upon the existing Medicaid 1115 waiver for California, utilize newly granted state flexibility under the current Administration, apply for a 1332 waiver under the ACA, and establish Healthy California as a Part B provider for Medicare as well as subsidize Part D premiums, approaches consistent with current law and regulation.

Professor William Hsiao in his July, 2011, analysis of constraints to state single-payer, cites existing provisions of the Social Security Act that give states the opportunity to administer Medicare, an element useful to creating the “single channel” entity that reimburses all providers, the model for Healthy California.

He also discusses the usefulness to state single payer of Section 1332 of the ACA, which Congress intended to facilitate state universal healthcare systems, including single-payer financing. Converting federal tax subsidies under the ACA to monies into the new Healthy California Trust Fund, and getting federal tax credits for any employer and individual tax payments to fund the new Trust Fund, are the primary changes, the granting of which are contemplated by the legislative debate and the ACA statute. The waiver must certify the state program is budget neutral to the federal government and expands coverage. Hawaii obtained a 1332 waiver in January to provide federal tax credits for employer paid state taxes, replacing tax credits for employer paid insurance or coverage, a precedent relevant to SB 562.

Much uncertainty surrounds the future of Medicaid, but greater state “flexibility” is expected, along with reduced funding. Such flexibility does make it more likely that California can obtain those federal Medicaid dollars, however we organize our healthcare financing, provided we spend those dollars per the eligibility rules.

In other words, Californians will receive every federal healthcare dollar for which we are eligible, the question is in what form — can we use those dollars as part of the “single channel” created by the Healthy California Trust Fund to pay providers? And if we don’t get those monies, or the Federal government denies waivers to California while granting great flexibility to other states, we can litigate. These decisions are subject to judicial review.

In a political environment of gridlock and worse at the federal level, and increasing focus for change at the state level, with Democrats in control of California government holding 2/3 legislative majorities and the governorship, the politics strongly favor organizing to win in the golden state. With the resources of a nation, California can and should lead the country to achieve healthcare as a human right.

Michael Lighty is Director of Public Policy at California Nurses Association/National Nurses United.

https://medium.com…

***

Comment:

By Don McCanne, M.D.

What legislative process on the state level is there that would allow a state to use Medicare, Medicaid, ACA subsidies and other federal funds for a state-based single payer system? That question is apropos to SB 562, the California single payer bill. Michael Lighty, the policy director for the California Nurses Association – the major driving force behind the current efforts to enact a single payer system in California, explains that process to us.

I will make no effort to paraphrase his comments.

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Single payer support growing but malleable

Data Note: Modestly Strong but Malleable Support for Single-Payer Health Care

By Liz Hamel, Bryan Wu, and Mollyann Brodie
Kaiser Family Foundation, July 5, 2017

As Congress continues to negotiate a repeal and replacement of the Affordable Care Act (ACA), some observers have suggested that if Republicans are unable to pass a replacement plan, it will create momentum for Democrats to push the country towards a single-payer health care system. This section of the latest Kaiser Health Tracking poll finds that while there has been a modest increase in the public’s level of support for single-payer in recent years, a substantial share of the public remains opposed to such a plan, and opinions are quite malleable when presented with the types of arguments that would be likely to arise during a national debate.

Trending support for single-payer

The June Kaiser Health Tracking poll finds that a slim majority of the public (53 percent) now favors a single-payer health plan in which all Americans would get their insurance from a single government plan, while just over four in ten (43 percent) are opposed. This is somewhat higher than the level of support found in a variety of Kaiser polls with slight variations in question wording dating back to 1998. From 1998 through 2004,  roughly four in ten supported a national health plan, while about half were opposed. In polling from 2008-2009, the period leading up to passage of the ACA, the public was more evenly divided, with about half in favor of a single-payer plan and half opposed.

Independents may be diving slight shift in overall attitudes

Not surprisingly, there are partisan divisions in how the public feels about single-payer health care, with a majority of Democrats (64 percent) and just over half independents (55 percent) in favor and a majority of Republicans (67 percent) opposed. However, the recent increase in support for single-payer has largely been driven by an increase among independents. Among this group, on average in 2008-2009, 42 percent said they would favor a single-payer plan, a share that has increased to a majority (55 percent) in the most recent tracking poll.

“Medicare-for-all” vs. “Single-payer”

Language often matters in framing questions about health policy. For example, the February 2016 Kaiser Health Tracking Poll found that when terms were tested on their own, outside the definition of a national health plan that would cover all Americans, the public was more likely to react favorably to the term “Medicare-for-all” (64 percent favorable) than “single-payer health insurance system” (44 percent favorable). However, the current poll finds that when the plan is defined as one in which all Americans would get their insurance from a single government plan, support is similar when the plan was referred to as “Medicare-for-all” (57 percent in favor) as when it was referred to as “single payer” (53 percent).

Support for single-payer is malleable when given opposing arguments

While a slim majority favors the idea of a national health plan at the outset, a prolonged national debate over making such a dramatic change to the U.S. health care system would likely result in the public being exposed to multiple messages for and against such a plan. The poll finds the public’s attitudes on single-payer are quite malleable, and some people could be convinced to change their position after hearing typical pro and con arguments that might come up in a national debate. For example, when those who initially say they favor a single-payer or Medicare-for-all plan are asked how they would feel if they heard that such a plan would give the government too much control over health care, about four in ten (21 percent of the public overall) say they would change their mind and would now oppose the plan, pushing total opposition up to 62 percent. Similarly, when this group is told such a plan would require many Americans to pay more in taxes or that it would eliminate or replace the Affordable Care Act, total opposition increases to 60 percent and 53 percent, respectively.

On the other side, when those who initially oppose a single-payer or Medicare-for-all plan are asked how they would feel if they heard such a plan would reduce health insurance administrative costs, four in ten (17 percent of the public overall) change their position and say they would now favor the plan, bringing total support to 72 percent. Similarly, when this group is told such a plan would ensure that all Americans have health insurance as a basic right or that it would reduce the role of private health insurance companies in health care, total support increases to 71 percent and 65 percent, respectively.

http://www.kff.org…

Topline: Precise questions and trends in responses
http://files.kff.org…

***

Comment:

By Don McCanne, M.D.

This highly credible Kaiser Foundation poll confirms the results of other recent polls showing that there has been a modest increase in support of single payer reform. A few specific points in this poll are worth noting.

Partisan polarization persists with 64 percent of Democrats supporting single payer and 67 percent of Republicans opposed. Amongst independents support has increased – now a majority at 55 percent, indicating that the single payer message is gaining traction amongst those not locked into a partisan camp. There is still a divide within each of the two dominant parties in that a significant minority of Democrats oppose single payer and a significant minority of Republicans favor it. For these reasons, single payer advocates should not narrowly target their educational efforts to a single party.

Last year a Kaiser poll showed that the term “Medicare-for-all” was preferred to “single payer” by 64 percent to 44 percent. With the recent increased interest in single payer, partly attributable to the presidential campaign of Bernie Sanders, the preference for Medicare-for-all over single payer has narrowed – now 57 percent to 53 percent. This is further evidence of the increased traction of single payer.

We have known that support for single payer is malleable. Previous surveys have shown that when supporters are asked about features of single payer that might be perceived as negative (too much government control, requiring more taxes, or now eliminating the Affordable Care Act) then support declines. This survey shows that the reverse is also true. When opponents are asked about single payer features that might be perceived as favorable (health insurance as a basic right, reduction in administrative costs, or reducing the role of private insurance) then support increases. In practice, the malleability has been used to defeat state ballot measures through the use of a few soundbites late in the campaigns. California’s measure lost 3 to 1 and measures in Oregon and Colorado lost 4 to 1. Positive soundbites do not seem to offset the uncertainty and fear created by negative soundbites.

Although this poll shows that there has been a modest increase in support of single payer – now 53 percent, up from the 40s over the past two decades – that support is malleable and 43 percent remain opposed. We still have a lot of work to do – education, coalition activities, and enlisting more grassroots support. Almost everyone would prefer single payer; it’s just that too many do not yet realize it.

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