PNHP

Framing health financing as wealth transfer ignores the moral imperative of social insurance

Framing health financing as wealth transfer ignores the moral imperative of social insurance

Health policy reform or wealth transfer?

By Gary Galles
The Orange County Register, May 9, 2018

Americans have been fighting over health insurance reform for years. Single-payer proposals, as most recently proposed in California’s legislature, are just the latest example. However, while rhetoric has focused on how many would supposedly gain or lose insurance, wealth transfers have been the real issue. As economist Henry Aaron estimated a quarter-century ago, implementing comprehensive national health insurance would redistribute more income than any single public policy then in existence.

We know insurance is not the real issue because claimed “reforms” violate so many principles of insurance.

The price controls reform proposals incorporate are also about transferring wealth, not health insurance. My age makes my actuarial risk six times that of my students. If, as Obamacare required, I could not be charged more than three times what they were, that really forces the young to subsidize the old, explaining why Obamacare imposed penalties to force acceptance of a bad deal.

Mandating coverage of pre-existing conditions also shows “reforms” are seldom really about insurance. It doesn’t reduce people’s risk exposure, it forces others to cover costs already known to be higher and deflects the blame to insurance companies who must charge others more. Such after-the-fact possibilities are not offered in fire, automobile or life insurance. Similarly, casinos don’t let you bet once the roulette ball or dice have stopped.

In addition, if health policy was truly aimed to benefit all Americans, rather than benefiting some by pick-pocketing others, it would not have been pushed with so many lies, damned lies and statistics.

Our health insurance debate has become so contentious largely because it has allowed massive wealth transfers to be mis-represented as improving health insurance. It helped dishonestly sell Obamacare, and now portrays reducing massive theft from those government targeted to hold the bag as imposing heartless harm on others. Such mis-representation cannot generate policies that advance either Americans’ or Californians’ well-being.

Gary M. Galles is a professor of economics at Pepperdine University, an adjunct scholar at the Ludwig von Mises Institute, a research fellow of the Independent Institute, a member of the Foundation for Economic Education faculty network, and a member of the Board of Policy Advisors at the Heartland Institute.

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Published comment:

By Don McCanne, M.D.

Wealth transfers have been the real issue? Isn’t the real issue rather ensuring that everyone has affordable access to essential health care services, as all other wealthy nations do?

We take for granted public services such as primary and secondary education, fire and police protection, public parks, highways and streets, national defense, Medicare, Social Security, the services of the National Institutes of Health, to mention a few. Most of the taxes used to fund these services are progressive to some degree – those with higher incomes pay more than those with lower incomes. Yet we do not refer to wealth transfer as being the primary policy that drives the existence of these services; it its the services themselves that are the primary public policies.

Health care stands out partly because of its very high costs. The cost of health care for the typical family of four receiving employer-sponsored PPO coverage is now $27,000 (Milliman). Median household income is now about $59,000. Although those are not identical family units, these numbers do make the general point that average-income families cannot possibly pay their proportionate share of global health care costs if they were evenly distributed amongst all of us (risk pooling).

Rather than framing this primarily as wealth transfer it should be framed as social insurance covering the health care needs of the people. If the funding were not equitable (progressive), too many would have to do without health care. The most efficient and effective methods of financing happen to be either a single payer system – an improved Medicare that covers everyone – or a national health service – socialized medicine. Most Americans would prefer Medicare for all, and would consider it their earned right, just as we consider Medicare in retirement to be our earned right rather than being primarily a government wealth transfer program.

https://www.ocregister.com…

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Comment:

By Don McCanne, M.D.

Although it is usually not wise to repeat the deceptive rhetoric of the opponents of health care justice, it can be helpful to understand it and be able to respond when it is in your face. Professor Galles uses wealth transfer – a concept he apparently considers to be evil – to reject the concept of pooling risk for health care.

It’s really simple. Because health care needs are unequally distributed, we need to pool risk by transferring from the healthy to the infirm. Because average health care costs are beyond the means of those with average incomes we need to fund the risk pool equitably based on ability to pay.

This is a concept that is accepted throughout society. Tax-financed public services are largely funded progressively through tax policy. That is not evil, but good. It makes it possible to provide those services for everyone. We don’t suggest that individuals with lower incomes should be denied fire or police protection merely because it would results a transfer of wealth.

Galles condemns what he calls wealth transfer when it makes health care services available to those who otherwise could not afford them. Yet he remains silent on the massive wealth transfer that necessitates these public policies – the transfer of wealth from the workers whose productivity has grown the economy, to those already wealthy rentiers who provide little personal contribution other than their excess capital gained by market abuses. That’s the shameful wealth transfer that our public policies should be addressing.

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The Time for Single-Payer Is Now

Countering Corporate Lies, Doctors Run Ad Providing the Facts About Medicare for All

By Jake Johnson
Common Dreams, May 12, 2018

As momentum in the fight for Medicare for All continues to grow nationwide thanks to persistent grassroots organizing by nurses, democratic socialists, and progressive activists, a group of California doctors placed an unprecedented eight-page ad in a major Sacramento newspaper on Thursday in an effort to combat corporate lies about single-payer and provide “patients and physicians with the tools they need to be effective advocates for a system that provides high quality care, but doesn’t bankrupt the sick or the U.S. economy.”

What If

“We don’t have the deep pockets of the insurance industry or the pharmaceutical industry, which Californians may recall spent $109 million two years ago to defeat a ballot measure to reduce drug prices, but we are determined to get the facts about single-payer out in Sacramento and across the country,” Dr. Paul Song, a radiation oncologist and president of the California chapter of Physicians for a National Health Program (PNHP), said in a statement.

The full eight-page publication—which features articles from doctors explaining how a single-payer system would be more cost-effective and provide far better care than the for-profit status quo—can be read here.

Funded by local PNHP members, the ad campaign ran in 100,000 copies of the Sacramento News and Review, and copies of the insert were given to every member of the California state legislature before the publication ran this week.

“There’s a lack of informative, accurate coverage of single payer in the mainstream media,” Dr. Bill Bronston, chair of the Sacramento Chapter of PNHP, said in a statement.

In addition to pressuring lawmakers in California and nationwide to get behind Medicare for All—which has been surging in popularity over the past year and now has the support of the majority of the American public—the ad insert is also aimed at urging “patients to talk to their doctors about how single payer could dramatically reduce drug costs and allow patients to choose their physicians without co-pays, deductibles, and outrageous out-of-network bills,” Dr. Song said.

https://www.commondreams.org…

APA panel: Single-payer system is the solution for mental health care

Single-Payer System Is the Solution for Mental Health Care, Panelists Say

By Kelly Davio
AJMC, May 7, 2018

In a discussion during the American Psychiatric Association 2018 Annual Meeting, held in New York, New York, a panel of psychiatrists argued that private insurance is failing patients with mental health disorders, and that a single-payer system would provide better access and better care for the most seriously ill patients.

J. Wesley Boyd, MD, PhD, a psychiatrist who focuses on adult outpatient psychiatry in the Cambridge Health Alliance, explained that mental health disorders, which affect 1 in 5 adults, are the leading cause of disability in the United States. Additionally, only 20% of children and youth with mental health disorders will get treatment, and “The effects can be lifelong and potentially devastating, both in terms of inability to retain work, possible interactions with the justice system, you name it…the stakes are very high.” In Boyd’s view, “The insurance industry is not doing anyone a favor when it comes to mental health care.”

Insurance companies create obstacles to needed mental health care, Boyd argued, starting with prior authorizations. “Anytime I have called for a prior authorization, I set aside 40 minutes to do that. I call a number, inevitably it’s a wrong number…I’m counting on being transferred at least twice before I get the person I need.” To Boyd, the difficulty in reaching the right person to authorize care is not merely a hassle, but potentially a deliberate attempt by insurers to curb access to care. “They want to make it as difficult for us as possible,” he said.

According to Boyd, payment for psychiatric services by private insurers is so low that many facilities lose money for the services that they provide, and consequently reduce access to the services that they offer.

Boyd discussed a study that he and his colleagues conducted in which they phoned 64 in-network Blue Cross Blue Shield (BCBS) mental health facilities in the Boston area to assess a patient’s ability to gain treatment. Researchers able to get an appointment only 12% of the time. In 23% of cases, they received no return call after trying twice to reach the clinic. In 23% of cases, facilities’ representatives explained that the patient would be required to receive primary care at the facility in order to be eligible for mental health services.

Monica Malowney, MPH, a consultant with the Public Consulting Group, added that in her own study, in which she and colleagues called 360 adult psychiatrists in 3 major cities using a provider list from BCBS, only 119 clinicians were reachable on a first round of calls. In another such study that focused on 913 psychiatrists in 5 major US cities who provide care to children, the researchers were able to get an appointment only 17% of the time.

Stephen Kemble, MD, who is retired from psychiatric practice, argued that value-based payment reform is compounding the problem of accessible care for patients with serious mental illnesses. According to Kemble, value-based models incentivize clinicians to avoid risky, more complex, socially disadvantaged patients because they may cost more to treat than other patients; “If you’re paid upfront, you want to avoid sick people. [You’re] cherry-picking.”

Kemble questioned whether the fee-for-service model itself is really to blame for the problem of high-cost, unnecessary care. Other drivers, such as lack of access to appropriate outpatient care, leads to unnecessary emergency department visits and hospitalizations.

Furthermore, the administrative burdens that come with a shift to value-based care, said Kemble, are creating physician burnout. In his experience in Hawaii, he has found that few private practice psychiatrists are willing to invest in the upgrades required to comply with reporting procedures associated with new payment models, so many clinicians simply stop accepting Medicare and Medicaid instead. As a result, he said, access in Hawaii is increasingly limited to community mental health centers and hospital clinics, so a number of seriously ill patients are unable to get urgently needed care.

Leslie Gise, MD, clinical professor of psychiatry at the John A Burn School of Medicine at the University of Hawaii and a staff psychiatrist at the Maui Health System, added that the current state of the healthcare system disproportionately disadvantages women in gaining access to mental healthcare, in part by charging women more for their coverage. The Affordable Care Act did not fully do away with the problem of “gender rating” enrollees, Gise said, because there are only nominal penalties for violating the law, an higher costs to employers to provide insurance to women can result in lower wages for female workers.

Furthermore, women who divorce often lose their private health insurance, she said, and the linkage of marital status and health insurance contributes to declines in women’s health. “Everyone should have adequate healthcare for life. Divorce should have nothing to do with it.”

A well-designed single-payer system that would cover all people for life, said Gise, would provide better outcomes, greater equality, and cost-reduction for the healthcare system at large.

http://www.ajmc.com…

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Comment:

By Don McCanne, M.D.

There has been a greater recognition of the need for mental health services at the same time that it has become clear that private insurers are failing us in providing adequate access to mental health care for those in need. It is hoped that our policymakers will listen to the recommendations of this panel that presented their case at the annual meeting of the American Psychiatric Association.

Their conclusion: “a single-payer system would provide better access and better care” for those in need of mental health services.

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

A more accessible video on the BUSPH symposium on Trump and public health

Yesterday’s message was on the symposium presented at the Boston University School of Public Health on “The Trump Administration and the Health of the Public.”

A more accessible version of the archived video is now available on the PNHP website along with a program listing the speakers and their topics.

The three videos total 6 hours (if you skip the first 28 minutes of background music before the program started):

https://pnhp.org…

A BU Today article on the symposium (the article emphasizes the racial injustices covered during the session):

http://www.bu.edu…

If you are curious as to why this symposium was worth sending out a second notice, click the first link above and skim the program again. These topics must be a part of our national dialogue on the health of the public.

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

Symposium on public policy and health in the Trump era

Dean's Symposium: The Trump Administration and the Health of the Public

Cosponsored with The Lancet Commission on Public Policy and Health in the Trump Era
Boston University School of Public Health, May 8, 2018

The day brought together public health scholars, journalists, thought leaders, and the wider public health community to discuss how we can view Trump-era policies and their impact on health more than a year into the new administration.

Agenda

OPENING REMARKS

Sandro Galea, Dean and Robert A. Knox Professor, Boston University School of Public Health

David U. Himmelstein, Distinguished Professor, School of Urban Public Health, Hunter College, City University of New York; Lecturer in Medicine, Harvard Medical School

Steffie Woolhandler, Distinguished Professor, Hunter College, City University of New York; Lecturer in Medicine, Harvard Medical School

KEYNOTE: FRAMING THE ISSUE—WHY THE TRUMP ADMINISTRATION MAY AFFECT HEALTH

Mary Travis Bassett, Commissioner, New York City Department of Health and Mental Hygiene

PANEL I: HEALTH OF PARTICULAR POPULATIONS – PART ONE

The Health of Immigrants
Altaf Saadi, Fellow, National Clinical Scholars Program, University of California, Los Angeles

The Health of Minority Populations
Zinzi Bailey, Assistant Scientist, Jay Weiss Institute for Health Equity, Sylvester Comprehensive Cancer Center, Miller School of Medicine, University of Miami

The Health of Children
Davida Schiff, Medical Director, HOPE Clinic, Massachusetts General Hospital

Moderator
Charles Kravetz, General Manager, WBUR

PANEL II: HEALTH AND BEHAVIOR

The Economy, and Its Impact on Health
Atheendar S. Venkataramani, Assistant Professor, Medical Ethics and Health Policy, Perelman School of Medicine, University of Pennsylvania

Trump Policies on Food and Nutrition
Marion Nestle, Paulette Goddard Professor and Professor Emerita, Steinhardt School of Culture, Education, and Human Development, New York University

Health Care
Adam Gaffney, Instructor of Medicine, Harvard Medical School; Pulmonary and Critical Care Physician, Cambridge Health Alliance

Moderator
Richard L. Berke, Founding Executive Editor, STAT

PANEL III: THE WORLD AROUND US

Global Health
Joia Mukherjee, Associate Professor of Medicine, Harvard Medical School; Chief Medical Officer, Partners In Health

The Environment
Martin McKee, Professor, European Public Health, London School of Hygiene and Tropical Medicine

Racism and Mental Health
Jacob Bor, Assistant Professor, Global Health, Boston University School of Public Health

Moderator
Carol Hills, Senior Producer, Reporter, and Host, PRI’s The World

PANEL IV: HEALTH OF PARTICULAR POPULATIONS – PART TWO

Native American Health
Michael E. Bird, National Consultant on Native American/Alaska Native Communities, AARP

The Health Crisis in Puerto Rico
Olveen Carrasquillo, Professor of Medicine and Public Health Sciences, Miller School of Medicine, University of Miami

Criminal Justice and Incarceration
Lello Tesema, Director of Population Health, Los Angeles County Correctional Health Services, Department of Health Services; Assistant Professor, Division of General Internal Medicine, University of Southern California; Gehr Fellow, Gehr Family Center for Implementation Science

Moderator
Jenifer McKim, Senior Investigative Reporter and Senior Trainer, New England Center for Investigative Reporting, Boston University College of Communication

CLOSING REMARKS

David U. Himmelstein, Distinguished Professor, School of Urban Public Health, Hunter College, City University of New York; Lecturer in Medicine, Harvard Medical School

Steffie Woolhandler, Distinguished Professor, Hunter College, City University of New York; Lecturer in Medicine, Harvard Medical School

https://www.bu.edu…

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Archived Video

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Comment:

By Don McCanne, M.D.

The next time you are in a mood to spend six hours or so on reading a book or whatever, use the time to view this symposium instead. This is as fine of a symposium on issues of health care justice as you’ll ever witness. And considering the challenges that our nation faces, this could not be more timely.

In his closing comments, David Himmelstein explains why we should be updating ourselves on these issues:

“Health professionals have a duty to play a role in the changes our country needs, not just coming from the top to change the politicians who lead us, but to change the sea that those politicians swim in, the data that they understand, and understand not just as dry facts that we feed them, but as things that motivate our citizens and that condition the lives of our nation. So we have a charge as public health and medical professionals to participate in the changes that our country needs.”

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

Michael Marmot: Childhood poverty and health inequity

Achieving health equity in the Americas

By Michael Marmot
Harvard Chan School of Public Health, May 3, 2018

But poverty – what are health people doing talking about poverty? Can we do anything about poverty? Well, you can, actually.

These OECD countries – there’s the United States. It’s looking at child poverty defined as less than 60% median income. In the US, 29% of children are in poverty. In Mexico, 31.6% in poverty.

David (Satcher) will remember, four years ago I addressed the American Public Health Association meeting, 8,000 people. And I showed something similar to this, that the US has such high child poverty levels. And I said– this was four years ago. You had a different person in the White House.

And I said, you live in a democracy. This must be the level of child poverty that you want. Otherwise, you’d elect a government that did something different. But can you change that? Well, yes you can.

This is reducing child poverty by social transfers– taxes and benefits, welfare. Finland reduces its pretax child poverty by 2/3 by taxes and transfers, Iceland similarly, Norway, Denmark Ireland, Sweden, even poor old UK. Oh, you’d rather not use the tax and benefits system.

I was teaching a global health class. And we had a student from Sweden. And when I talked about child poverty and the effect of government policy, this student from Sweden was really confused. She said, you mean some countries just operate their tax and benefit system to have high levels of child poverty? She couldn’t understand why any country would do that.

It is difficult to understand, isn’t it? Why would any country do that? Why would your country only reduce poverty by 18% by taxes and transfers? Pretty rich place.

And my country has decided to make inequality worse. This is the long run impact of tax and benefit reforms in the United Kingdom between 2015 and 2019. Look at families, working age families with children by deciles of income.

If you’re in the bottom decile, the bottom 10%, the Minister of Finance has decreed changes to the tax and benefits system that will lead to your income dropping by 9.5% by 2019. If you’re in the second bottom decile, your income will drop by more than 12%. And then the higher your income, the less the drop. It’s quite possible for the Minister of Finance to redistribute income. Our minister of finance is doing it, just redistributing it upwards and making families with children worse off.

I had a senior politician in London say to me, I’ve been listening to the evidence you gave to the Scottish Parliament. And I thought, what? You’ve been doing what? You should get out more.

And he said, you’re anti-government. And I said, no, I’m not. I’m pro-health equity.

Any policy that’s likely to have an adverse effect on child poverty will have an adverse effect on health inequalities. And that’s what I’m against. And in the US, a less progressive tax code from the 1960s, this is the top 0.1%. From the 1960s to 2013, the top 0.1% had a reduction in their tax by 2.1 percentage points and the bottom 50% an increase by 4.3 percentage points. You’re doing what we’re doing, making the tax system more regressive.

And the much vaulted recent tax bill, by 2027, the top 0.1% will get a 3% reduction. And the bottom 50% will get a 2% reduction. This is what the evidence shows.

Michael Marmot is Professor of Epidemiology and Public Health at University College London and one of the world’s foremost researchers on health inequalities.

Transcript, audio and video available through this link:
https://www.hsph.harvard.edu…

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Comment:

By Don McCanne, M.D.

The United States of America – the land with very high childhood poverty and associated health inequity. How would that placard look at our Fourth of July celebrations?

We can do something about it. As Michael Marmot says, we live in a democracy and thus we can have the level of child poverty that we want. Assuming that we would want it to be much lower than it is, why haven’t we done something already?

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

Public Health Symposium at Boston University

PNHP leaders Drs. Steffie Woolhandler, David Himmelstein, and Adam Gaffney joined other public health luminaries on May 8, 2018 to discuss “The Trump Administration and the Health of the Public.” This daylong symposium was hosted by the Boston University School of Public Health, and cosponsored by the newly formed Lancet Commission on Public Policy and Health in the Trump Era. Click here for more details.

Merging insurers with the health care delivery system

Partners HealthCare, Harvard Pilgrim discussing possible merger

By Priyanka Dayal McCluskey
The Boston Globe, May 4, 2018

Hospital giant Partners HealthCare, looking to fortify its position in the rapidly changing health care market, is in potential merger negotiations with Harvard Pilgrim Health Care, one of the state’s largest medical insurers.

Executives from Partners, Massachusetts’ largest network of doctors and hospitals, and Harvard Pilgrim have been talking for several months, officials from both companies confirmed Friday in response to inquiries from the Globe. They are discussing a range of options, including an acquisition of Harvard Pilgrim by Partners.

The talks are taking place at a time of heightened deal-making in health care across the country, as hospitals, physician groups, insurers, and other companies pursue new strategies to manage costs and patient care. In Massachusetts, Beth Israel Deaconess Medical Center and Lahey Health are planning a big hospital merger to more aggressively compete with Partners.

Boston-based Partners is the parent company of Massachusetts General, Brigham and Women’s, and several other hospitals. Its expansion plans have been scrutinized in the past because the company is the most dominant health care provider in Massachusetts, and among the most expensive. Partners acquired specialty hospital Massachusetts Eye and Ear this year, and it’s negotiating a takeover of Care New England Health System in Rhode Island.

“Partners HealthCare is constantly exploring new partnerships and relationships with other providers and insurers with the goal of improving the delivery of health care to patients both locally and around the world,” Partners spokesman Rich Copp said. “Harvard Pilgrim is certainly among those organizations.”

“We’re looking at what we could do differently that brings value to our marketplace,” Harvard Pilgrim’s chief executive, Eric H. Schultz, said in an interview.

The US health care industry is in a time of rapid deal-making, with companies trying to cut costs by owning more pieces of the health care pie. CVS Health and the insurer Aetna have been working on a deal, for example.

In recent years, the lines between health care providers and health insurers have blurred.

Among the uncertainties around the combination of Partners and Harvard Pilgrim is what would happen to Partners’ existing insurance business, Neighborhood Health Plan.

Partners acquired Neighborhood in 2012. But instead of boosting Partners’ bottom line, Neighborhood — which traditionally focused on low-income individuals on Medicaid — contributed to historic financial losses at Partners.

Neighborhood shed many of its low-income members and worked aggressively to sell insurance to employers. But with about 142,000 members, it remains a small player compared with the state’s big three insurers: Blue Cross Blue Shield of Massachusetts, Harvard Pilgrim, and Tufts Health Plan.

https://www.bostonglobe.com…

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Comment:

By Don McCanne, M.D.

The potential merger between Partners HealthCare and Harvard Pilgrim Health Care is not just another routine merger and acquisition activity, but it is one occurring at the heart of the U.S. health care system – Massachusetts General Hospital being one of the oldest and most prestigious hospitals in the nation.

It is distressing to see multiple hospitals and physicians merge to gain market advantage, but it is even more disturbing when an integrated health care delivery system is merging with one of the state’s largest insurers. The implication that this is to serve the patients better is belied by the fact that Partners’ previous acquisition of a smaller insurer – Neighborhood – was followed by the shedding of its low-income members as it aggressively marketed itself to the more lucrative employer-sponsored insurance market.

Under a well designed single payer national health program, supposedly we would eliminate the private insurers and switch to a publicly-administered pre-paid health program. But what happens when the private insurers become an integral part of the actual health care delivery system? As is there weren’t enough problems already, obviously that would make implementation of a single payer system that much more difficult.

We’ve spent eight years talking about improving Obamacare by the feeble act of adding a public option, perhaps as a Medicare buy-in, when right under our noses this M&A activity has been taking place. They are building a health care delivery system that will be unassailable by social insurance programs. Are we going to wait until the only solution to bringing health care justice to all will be to nationalize our health care delivery system? How feasible is that?

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

Docs talk single-payer at forum

Group wants to remove barriers to health care

By Ashley Sloboda
The (Fort Wayne, Ind.) Journal Gazette, May 7, 2018

Dr. Jon Walker didn’t pressure his audience of about two dozen Sunday to agree with his case for a single-payer health care system, also known as Medicare for all.

“You don’t have to accept this,” he said.

He did, however, encourage those at the Allen County Public Library meeting room to research the topic. He and others said they want the single-payer model to be considered.

“What we want is a discussion,” said Dr. Alison Case, who joined Walker as a panelist during a forum sponsored by Hoosiers for a Commonsense Health Plan.

The group is the Indiana affiliate of Physicians for a National Health Program, a nonprofit research and education organization of 19,000 physicians, medical students and health professionals who support single-payer national health insurance.

Under a single-payer system, a single public or quasi-public agency organizes health care financing, but the delivery of care remains largely in private hands, according to the national nonprofit. The organization expects benefits would include the elimination of financial barriers to care, such as deductibles.

All were welcome at Sunday’s forum, but many attendees indicated they work in health care.

Multiple speakers said the existing system is too expensive and, among other problems, leaves many underinsured or uninsured, resulting in people suffering and dying from illnesses they shouldn’t be suffering or dying from.

“This is a loss to our entire nation,” said Elaine Fazzaro, a retired registered nurse involved with Hoosiers for a Commonsense Health Plan.

As a physician, Case said, it’s frustrating that costs prevent patients from following treatment plans, such as people with diabetes not taking insulin because it’s unaffordable.

Panelist Dr. Tom Hayhurst recalled a 41-year-old man whose economic gamble cost him his life. Instead of immediately seeking medical treatment, financial reasons prompted the married father to wait until his temperature reached 104 degrees and he was gasping for air. By then, doctors couldn’t cure his pneumonia, Hayhurst said, calling the man’s death preventable.

Some attendees doubted the country will implement a single-payer system.

“Don’t give up. Let’s go to Washington,” Edith Kenna of the state organization said to a skeptical attendee.

Fazzaro agreed that it’s important to put pressure on lawmakers.

“Our politicians get so much influence from the…corporate side of it,” she said. “We have to have people understand what a single-payer health care plan would be.”

http://www.journalgazette.net…

There is a better way to deliver health care

By Herbert Keyser, M.D.
San Antonio Express News, May 5, 2018

About 20 years ago, I accepted a position to be the backup obstetrician for nine well-trained midwives in a large medical center.

The institution had decided that all deliveries would be done by them unless complications ensued. Under those circumstances I would be called upon to either assist in the management or take over the case.

It was a wonderful and gratifying experience. I learned a new way of looking at normal birth, based on constant supportive care during labor and delivery. The results were more than phenomenal. A national publication wrote an article describing our results as some of the best in the country.

I wanted to understand why that should be.

It wasn’t that we were smarter than all the physicians in facilities where all the babies were delivered by obstetricians. We were doing the same proportion of complicated cases as seen elsewhere. There had to be another answer.

Soon it became apparent to me.

When cases became complicated, I did the interventionist procedures that were required. But without complications the midwives spent long hours with these patients. That allowed these mothers to accomplish normal uncomplicated vaginal deliveries.

In the world of physician-delivered newborns, other factors intervened. Rarely did an obstetrician sit for hours with a patient in labor. Office hours and surgery all took time.

Commonly, physicians do not appear until the point of delivery. The earlier stages are managed by a labor room nurse who frequently has multiple patients in labor.

The explanation was simple.

The presence, uninterrupted, of a supporting person made all the difference. Without pressures to end the labor, do an unnecessary cesarean section, or intervene in any way, women had their babies with fewer complications and better results.

This year, my wife had a serious medical problem. I decided to seek help from the famed Mayo Clinic. Their national statistics are the top in American medicine. However, the reason for this superiority is a conundrum. There are great physicians all over this country.

So, why is the Mayo Clinic overwhelmingly evaluated as being at the top?

From the moment we arrived, I was impressed by the efficiency of this organization. It took several days to understand what made the difference. It was not dissimilar from my experience with the midwives.

Today’s private-practicing, fee-for-service physician knows that to make the practice work, it is necessary to turn over a great number of patients. Expenses have soared, with malpractice, office rental and labor costs constantly increasing, only a large volume of patients can sustain the economic forces.

That is not the world of the Mayo Clinic.

Every physician spent a great deal of time with us, frequently over an hour.

The answer was quite simple. There is no fee for service. There is no bonus system for productivity. Everyone is on a fixed salary, which varies by specialty and longevity. The average salary is less than in some parts of the country, but is not terrible — at just under $300,000 per year.

Every physician can refer any patient to another physician in every area of medicine to rule out other possible causes of an illness, with no pressure to produce, just the need to care for patients.

If Mayo can do that, why can’t everyone?

We are told “we can’t afford a single-payer system.” The real truth is that we spend so much per person for health care, that just spending the same amount in a single-payer system we can provide better care than any of the other countries of the world and care for everyone, not just three-fourths of our population.

Some will be unhappy.

The insurance industry will not be pleased.

The pharmaceutical industry will have to be content with reasonable rather than exorbitant profits.

The physicians who charge huge fees will have to be paid less, although physicians in general will be quite well compensated.

Then the Mayo Clinic will be just one of many places providing the highest quality care.

Spending quality time with each and every patient can be a wonderful benefit in finding our way out of the disgraceful health care system that this country maintains.

The political pressure exerted by all the forces previously mentioned that profit from our present system must somehow be overcome.

Americans really can have the kind of health care they pay for and deserve.

Dr. Herbert H. Keyser of San Antonio was the co-director of the Department of Obstetrics and Gynecology for one of the largest hospitals in Long Island, New York, for eight years, served as a lieutenant colonel in the United States Army Medical Corps, and for the last 25 years delivered babies primarily in poverty areas, Indian reservations and in locations of migrant workers.

https://www.mysanantonio.com…

Beware the disruptors and their wellness-industrial complex!

The New Health Economy in the age of disruption: Novel combinations attempt to remake the health system

PwC Health Research Institute, April 2018

The last six months have seen an explosion in unusual deals with the potential to reshape the US health ecosystem. CVS Health announced its intention to purchase Aetna for $69 billion. Cigna Corp. has announced an agreement to buy Express Scripts Holding Co. for $67 billion. UnitedHealth Group’s Optum purchased DaVita Medical Group for $4.9 billion. Albertsons Cos. has agreed to merge with Rite Aid Corp. Other high-profile and novel healthcare deals have been floated in the press. Several unusual partnerships also have been announced, including one among Amazon, JPMorgan Chase & Co. and Berkshire Hathaway Inc.

And these are just the largest and most recent deals and partnerships. In 2017, 967 deals occurred in the US health services market, including healthcare payers and providers. Deal value increased 146 percent over 2016. The US health industry is undergoing seismic change generated by a collision of forces, including the shift from volume to value, rising consumerism and the decentralization of care. This shifting terrain is creating uneven opportunities in the New Health Economy and will likely drive players new and established to reconsider their business models and strike the sorts of deals announced in the past six months. Some will be driven to seek returns in new markets as their core revenues shrink. Others will find success creating value for other players, including consumers. Still others will thrive by building infrastructure for the emerging virtual health system.

The US health system is starting to reorganize to obtain more favorable pricing and reimbursements. Companies are building capabilities to cut costs and meet customer needs in more convenient and transparent ways. Companies with capabilities across vast swaths of the health ecosystem are emerging, offering consumers one-stop shops for care, treatments, financing and risk management, wellness products and services—and in the case of retailers, toys, milk and wireless speakers.

The New Archetypes:

* Vertical Integrators

Companies such as CVS Health and Aetna, UnitedHealth Group’s Optum and DaVita Medical Group, and Cigna Corp. and Express Scripts Holding Co. have announced mergers or acquisitions to offer millions of consumers access to a broad array of cost-efficient, integrated, transparent services and products. They are doing this, in part, by absorbing some of the industry’s middlemen and vertically integrating parts of the US health ecosystem. “In a value-based environment, the more pieces of the supply chain that you can influence, the more you can impact utilization and cost, driving a win-win across providers, payers and patients,” said Jane Sarasohn-Kahn, a healthcare economist and founder of the group THINK-Health.

Companies also need a wider, data-driven view to develop new ways to cut waste and improve outcomes at lower costs. Vertical Integrators can, in theory, pull together many sources of key consumer data, allowing that broader vision to come into focus. “Data is really key to integration efforts,” said Eric Topol, founder and director of the Scripps Translational Science Institute.

* Employer Activists

Employer Activists are banding together to find ways to cut their employees’ healthcare costs. In February 2016, 20 US companies formed the Health Transformation Alliance (HTA), which has since worked on developing tools for its members to cut employee healthcare costs. In January 2018, Amazon, JPMorgan Chase & Co. and Berkshire Hathaway Inc. announced they would partner to form an independent company to lower healthcare costs and improve satisfaction for their employees by addressing healthcare quality and transparency.

Employers have, of course, long worked to reduce the amount they spend on health benefits. They have shifted premium costs to employees, raised deductibles and other cost-sharing, narrowed choices of in-network providers, experimented with reference pricing, launched pricing transparency tools to help employees and their families make price-conscious choices, and used formulary decisions and pre-authorizations to curb use of higher-priced therapeutics.

These strategies have had an impact. Utilization has been mostly flat for the last decade. Medical price, however, has risen 3-6 percent each year and remains an important medical cost trend driver.

* Technology Invaders

Technology Invaders have been trying to disrupt the US health industry for almost a decade. In 2013, HRI found, 76 percent of the Fortune 50 were engaged in the healthcare industry; several were technology companies aiming to use their digital prowess, pragmatism and consumer savvy to develop better ways to deliver, pay for and access care. In 2018, a slightly higher percentage of the Fortune 50 is involved with health, with about the same number of tech companies.

These Technology Invaders are gaining traction. Besides being an Employer Activist, Amazon has quietly started selling private-label over-the-counter medical products, from hair growth formula to allergy medicine. It also started offering Medicaid recipients discounted access to its Prime subscription service.

Apple’s newest operating system allows users to access parts of their EHRs on their phones; the company has partnered with more than three dozen hospitals for its Apple Health Records platform.

While Technology Invaders have the capability to disrupt, they likely will need partnerships with existing healthcare companies to actually do so.

* Health retailers

Health Retailers such as CVS Health, Walgreens Boots Alliance, Walmart, Albertsons Cos. and others use their vast network of store locations, troves of consumer insights, national and global supply chains and national (and sometimes global) branding to attract consumers looking for affordable, convenient care and goods in a system known for its lack of affordability and convenience. Over the past five years, consumers have consistently told HRI that they are open to receiving a wide range of services in retail settings, from wound care to MRIs.

Health Retailers are expanding in size and adding to their health offerings. The Albertsons-Rite Aid deal would give the chain 4,350 pharmacy counters in 4,900 stores and an additional 320 medical clinics, according to the companies. They said they expected the combination of its retail locations and healthcare offerings to drive financial growth. “This powerful combination enables us to become a truly differentiated leader in delivering value, choice, and flexibility to meet customers’ evolving food, health, and wellness needs,” said John Standley, Rite Aid chairman and CEO.

Health Retailers have an opportunity to use their consumer financial savvy to bring patients into the fold and keep them coming back, using reward programs and other strategies. For example, companies can offer consumers incentives to obtain care at a clinic, or offer subscription-type services to keep consumers coming back on a regular basis.

What comes next?

Dramatic change has been predicted for the US health system for many years. Finally, the industry is seeing the emergence of fundamentally new models: Vertical Integrators, Employer Activists, Technology Invaders and Health Retailers. Whether they will succeed in disrupting the health system, which has stubbornly resisted significant change, remains unknown. But they may find the environment more amenable to change than ever before, as healthcare costs are increasingly borne by consumers and pressure to pay for value instead of volume increases.

Companies may find success in these models, but they are unlikely to be bound by them. In fact, companies that are able to blend various archetypes may be positioned best to win in an evolving environment. At a minimum, companies should consider how they fit in this new environment and how they can succeed in their particular space. Consolidation and integration may put new pressures on existing healthcare organizations like pharmaceutical manufacturers, but they also might open up new opportunities, such as partnerships between providers and Health Retailers.

Players new and traditional come at the shifting landscape from very different directions, but there are resilient moves all healthcare companies should consider making:

* Invest in customer experience.

Consumers’ views on health can change rapidly. Many consumers are ready for healthcare to mirror other parts of their lives in terms of convenience, choice and the presence of affordable options with predictable pricing. Vertical Integrators, Technology Invaders and Health Retailers all have a leg up on many established health players in understanding consumers and tailoring experiences for them.

* Plan for a broader workforce.

These new business models possess capabilities that are minimally present in established health players. The new models may have armies of workers coding, working on AI, analyzing data, prototyping new services and products, and focusing on customer experiences. These new companies also may have staff from traditional players with deep knowledge of the health industry. Health companies competing in this new world should plan for a much broader workforce. And they should be prepared to pay for them—the rest of the global economy is seeking these capabilities too.

* Focus on price.

Employers, the government and other players largely have focused on utilization over the past decade. Price is the next frontier. Vertical Integrators, Employer Activists, Technology Invaders and Health Retailers are positioned to address price through greater scale, ownership of middlemen and a wider grip on the US health system value chain. Consumers, employers and the federal government are seeking relief on price and likely will reward companies able to significantly cut them without downgrading quality.

https://www.pwc.com…

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Comment:

By Don McCanne, M.D.

Arnold Relman warned us about the medical-industrial complex, but it is likely that even he did not realize how intense would be the disruptive innovation in health care that is beginning to take place.

What we are about to see is a takeover by the disruptors who “have a leg up on many established health players in understanding consumers and tailoring experiences for them.”

“This new world should plan for a much broader workforce (of disruptors), and they should be prepared to pay for them.”

The disruptors “are positioned to address price through greater scale, ownership of middlemen and a wider grip on the US health system value chain.”

It is almost as if the physicians, nurses and other health care professionals and the hospitals and clinics in which they provide their services have become a peripheral, albeit necessary, appendage to their wellness-industrial complex that is displacing our traditional health care delivery system and its more recent iteration of the medical-industrial complex – all for power and profit.

I remember when California enacted legislation that allowed the insurers to contract directly with the health care providers. I warned my friends about what this meant. “That can’t happen,” they said, and they hardly turned around when the managed care revolution was upon us.

Well, you say, this is different. It can’t happen. But it has already begun, and before you can turn around… well, you know.

Once the transformation is well along, imagine trying to implement a single payer, improved Medicare for all. It is likely that traditional Medicare will have been displaced by future iterations of Medicare Advantage plans, and so it would no longer serve as a model for reform. Once the silos of the health care delivery system are flattened, how will health care services be financed? Will there still be networks? Cost sharing barriers such as high deductibles? Will it be possible to fund this expansive model of the wellness-industrial complex through anything remotely resembling an insurance product, especially when the insurers are being amalgamated into what was formerly the health care delivery system? And now that the plutocracy is in control, how could we ever remove the passive investors that extract humongous rents through the wellness-industrial complex? And what about the patients? Did we forget about them?

The acutely ill, the injured, and those with chronic diseases will always be with us. The demand for decent health care will always be there. But the longer we wait to enact a truly universal, accessible, equitable and affordable health care system, the more difficult it will be. As an example, just think of how difficult it is to inform the public that they are getting a very bad deal when they support private Medicare Advantage plans. Compound that difficulty with the massive disruptions that are about to be foisted upon us by the New Health Economy that PwC describes in this report. The disruptors really understand marketing.

And, by the way, a Medicare buy-in public option won’t do it. It will only give the disruptors more time to fortify their New Health Economy. We must change our course today (yesterday, except that we can’t recover time already lost).

A single-payer national health program, aka an improved Medicare for all. Nothing less. Pull all stops today!

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