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Medicare for All Explained Podcast: Episode 108

Medicare for All Explained Podcast: Episode 108

A Prologue to the Future

February 15, 2024

Podcast host Joe Sparks brings up the drastic measures imposed by the University of Delaware to confront rising health costs: everything from freezing hiring, to pausing university projects, to curbing employee travel.

“If we would switch from employers paying for health care to a single-payer Medicare for All system,” he says, “then universities and businesses would not have to worry about health insurance.”

Additional episodes will be uploaded monthly. Subscribe in iTunes, or access a complete archive of the podcast, below.

https://medicareforallexplained.podbean.com

Reversing the Corporate Practice of Medicine

A new organization, Take Medicine Back, is sounding the alarm about the corporate acquisition of medicine, which disrupts clinical care – harming both patients and doctors. The solution: enforce existing laws, create new laws, align physician organizations against corporate control, and unionize physicians.

A Call To Action To Take The Profession Back from Corporate Interests, TAKE MEDICINE BACK, October 2023, by Mitchell Li, M.D.; Sailesh Konda; and Robert McNamara

Conclusion:

The corporate practice of medicine doctrine was integral in providing an ethical basis for the practice of medicine. Today, the AMA explicitly tolerates the corporate practice of medicine, and state prohibitions on CPOM are broadly unenforced. The vast majority of physicians are now employees of increasingly consolidated corporations, while moral injury and burnout among physicians are at unsustainable levels. Rapid horizontal and vertical consolidation of non-physician healthcare corporations that employ physicians not only increases monopoly power over consumers, which in return increases costs, but also increases monopsony power over physician labor. This has resulted in anti-competitive labor practices that lead to intimidation of, and retaliation against physicians who advocate for patients. This places the public at risk through greater corporate influence over the practice of medicine. …

A new era of robust antitrust enforcement in healthcare is needed. Past FTC actions against the AMA restricting the ability to impose ethical restrictions on its members should be re-examined in the context of unintended consequences of enabling corporatization and consolidation. A national prohibition on the corporate practice of medicine is necessary to accompany the strengthening, and enforcement of existing state-based prohibitions. Physician organizations must collectively reject non-physician corporate ownership of medical practices. Reclaiming the profession from corporate interests will take time, and greater protections for employed physicians are needed now in order to protect patients. In the face of legislative inaction at the state and federal level, employed physicians should use the tools available to labor and organize through unionization.

[HJM bolding]

The Corporate Practice of Medicine By The Numbers

  • 74% – Physicians employed by corporate entities
  • 34 – States prohibit the corporate practice of medicine to protect patients – and enforced in none of them
  • 87% – Of physicians say patients trust them less than they did a decade earlier
  • 140 million – Americans facing financial hardship due to healthcare bills
  • $1 Trillion – Worth of private equity transactions in healthcare over the past decade
  • 63%  – Of physicians reporting burnout in 2020 – an all-time high, and rising
  • 2.51 – Replacement ratio of physicians by non-physician practitioners in private-equity owned medical practices
  • 1 in 4 – U.S. Medical Students are considering quitting their studies
  • 58% – of U.S. Medical and Nursing students do not intend to treat patients
  • 1 in 10 – physicians working under or for United Health

Comment:

By Don McCanne, M.D. and Jim Kahn, M.D, M.P.H.

In 1980, NEJM editor Arnold Relman, M.D. issued the warning of the relatively unheralded rise of a huge new industry that supplies health-care services for profit which he labeled the “medical-industrial complex.” He concluded, “How best to ensure that the medical-industrial complex serves the interests of patients first and of its stockholders second will have to be the responsibility of the medical profession and an informed public.”

Apparently the medical profession and the public have largely failed in this responsibility – based on the statistics showing that private ownership and profits are shifting to private equity, yielding dissatisfaction of both health care professionals and, most importantly, patients.

Today’s HJM directs our attention to an organization that is sounding a call to action to “take the profession back from corporate interests.” The name of their organization is simply TAKE MEDICINE BACK. They have produced a very easy-to-read 63-page paper. Their recommendations are complementary to those of Physicians for a National Health Program and other organizations that support health care justice for all.

We should work together to take medicine back from private equity and the corporate world and use it to fulfill our dreams of realizing comprehensive, equitable, affordable, high quality care for absolutely everyone. Those of us who really care are now busy aligning ourselves in the direction that will get us there. Let’s go!

https://healthjusticemonitor.org…

Stay informed! Subscribe to the McCanne Health Justice Monitor to receive regular policy updates via email, and be sure to follow them on Twitter @HealthJustMon.

Medicare subsidies prop up profits

By Ken Dolkart, M.D.
Valley News (Lebanon, N.H.), Letters, February 9, 2024

Traditional Medicare excels in administrative efficiency. The privatization of Medicare via contracts with intermediary Medicare Advantage (MA) megaliths has required subsidies of $613 billion to reduce premiums for subscribers. Many seniors welcome those negligible premiums offered by MA and the modest-costing additional “bells and whistles” that are so heavily marketed. However, denial and increasing restriction of services, subtle “lemon-dropping” of sicker patients into traditional Medicare, not so subtle coding fraud and the need for added subsidies to assure private profit threatens the financial integrity of Medicare. Patients are starting to share horror stories of denial of specialist care, not to mention the administrative burden on clinicians in trying to get approval for that care. We are recapitulating the 1990s, prior to the ACA, when public disgust arose due to denial of care and rising costs of the deregulated, interstate managed-care industry.

As a subscriber to traditional Medicare, I recently learned that my traditional Medicare premiums have been raised to pay for those subsidies that enable profit by MA plans! MA’s profitized inefficiencies should not require raising premiums on subscribers of traditional Medicare. Those subsidies would be better spent expanding the services of traditional Medicare. Our must trusted form of “universal care” for American seniors is being scavenged by those who turn Reaganesque, anti-regulatory fervor into ways to creatively siphon money off public health dollars.

Promotion of the financial interests of the publicly traded, for-profit medical industry seems to be the chief concern of Health & Human Services, CMS and Congress. We must ask our representatives to develop a coordinated, regulated, care-directed program that integrates clinicians, hospitals, community services and payment programs.

https://www.vnews.com…

Reminders that Private Insurers Use Shady Tactics to Manipulate and Deceive Us

“Free” preventive services that cost patients hundreds of dollars. A Medicare enrollment “choice” that defaults to Medicare Advantage. These are two newly highlighted devious maneuvers that favor benefits for shareholders over benefits for the public.

Opinion: Ouch. That ‘free’ annual checkup might cost you. Here’s why, Washington Post, January 24, 2024, by Elisabeth Rosenthal

When Kristy Uddin, 49, went in for her annual mammogram in Washington state last year, she assumed she would not incur a bill because the test is one of the many preventive measures guaranteed to be free to patients under the 2010 Affordable Care Act. The ACA’s provision made medical and economic sense, encouraging Americans to use screening tools that could nip medical problems in the bud and keep patients healthy.

So when a bill for $236 arrived, Uddin — an occupational therapist familiar with the health-care industry’s workings — complained to her insurer and the hospital. …

The ACA’s designers might have assumed that they had spelled out with sufficient clarity that millions of Americans would no longer have to pay for certain types of preventive care, including mammograms, colonoscopies and recommended vaccines, in addition to doctor visits to screen for disease. But the law’s authors didn’t reckon with America’s ever-creative medical billing juggernaut. …

[HJM: see the article for more examples of this “billing minefield”. And see also
The colonoscopies were free but the ‘surgical trays’ came with $600 price tags]

Republicans Are Planning to Totally Privatize Medicare — And Fast, Rolling Stone, February 5, 2024, by Andrew Perez

The right-wing policy agenda written for a new Donald Trump presidency would “greatly accelerate” efforts to privatize Medicare.

Last year, for the first time ever, a majority of Americans eligible for Medicare were on privatized Medicare Advantage plans. If Republicans win the presidential race this year, the push to fully privatize Medicare, the government health insurance program for seniors and people with disabilities, will only intensify.

Conservative operatives have already sketched out what the GOP’s policy agenda would look like in the early days of a new Donald Trump presidency. As Rolling Stone has detailed, the proposed Project 2025 agenda is radically right-wing. One item buried in the 887-page blueprint has attracted little attention thus far, but would have a monumental impact on the health of America’s seniors and the future of one of America’s most popular social programs: a call to “make Medicare Advantage the default enrollment option” for people who are newly eligible for Medicare.

Such a policy would hasten the end of the traditional Medicare program, as well as its foundational premise: that seniors can go to any doctor or provider they choose. The change would be a boon for private health insurers — which generate massive profits and growing portions of their revenues from Medicare Advantage plans — and further consolidate corporate control over the United States health care system.

Comment:

By Jim Kahn, M.D., M.P.H.

We know very well that the fundamental purpose of the private health insurance business is to make money for shareholders. HJM has highlighted the massive profits which are enhanced by high financial barriers to care and tens of billions of dollars in overcharges to public payers like Medicare.

Now we learn of two more startling examples of shady business tactics, present day and dystopian future.

1) Creative billing. A mandated benefit of the Affordable Care Act is free-to-the-patient preventive care. That is, insurers pay fully. But sometimes they don’t. It turns out that segmenting prevention services into pieces, or piling on non-prevention services, hits patients with hundreds of dollars in fees. Not free! Reminds me of the massive “convenience,” “processing,” and “delivery” fees imposed when renting or purchasing a car, buying concert tickets, or banking. Idiosyncratic provider billing confuses matters. But insurers have an incentive to be negligent – if they fail to assure that charges are appropriately bundled in a prevention package, it lowers their costs as some costs land with patients.

2) “Default Enrollment to Medicare Advantage”. This scheme is in the dystopian Project 2025 laid out by the MAGA GOP – a 920-page blueprint for far-right policy implementation if Trump wins in 2024. Buried deep in the text is the idea that the choice of traditional Medicare vs. Medicare Advantage should “default” to the latter. That is, unless new Medicare beneficiaries “opt out” of MA, they’re stuck with it, and with the MA problems (like financial barriers and narrow networks) which we’ve written about. How much does this matter? A lot – one academic review estimated a 27% shift, e.g., from 40% MA to 67% MA. The exact effect will depend on wording, and could be a lot more. This is “behavioral economics” – e.g., nudging actions through choice framing, wording, or visual layout. If in the interest of helping people (e.g., eat healthier), terrific. If in the interest of building profits for shareholders with public money, terrible.

We need a single, government payer. It will end complex billing rules and manipulations to increase insurer profits. It will turn health insurance into a public good optimizing public benefit.

https://healthjusticemonitor.org…

Stay informed! Subscribe to the McCanne Health Justice Monitor to receive regular policy updates via email, and be sure to follow them on Twitter @HealthJustMon.

Republicans Are Planning to Totally Privatize Medicare — And Fast

The right-wing policy agenda written for a new Donald Trump presidency would “greatly accelerate” efforts to privatize Medicare

By Andrew Perez
Rolling Stone, February 5, 2024

LAST YEAR, FOR the first time ever, a majority of Americans eligible for Medicare were on privatized Medicare Advantage plans. If Republicans win the presidential race this year, the push to fully privatize Medicare, the government health insurance program for seniors and people with disabilities, will only intensify.

Conservative operatives have already sketched out what the GOP’s policy agenda would look like in the early days of a new Donald Trump presidency. As Rolling Stone has detailed, the proposed Project 2025 agenda is radically right-wing. One item buried in the 887-page blueprint has attracted little attention thus far, but would have a monumental impact on the health of America’s seniors and the future of one of America’s most popular social programs: a call to “make Medicare Advantage the default enrollment option” for people who are newly eligible for Medicare.

Such a policy would hasten the end of the traditional Medicare program, as well as its foundational premise: that seniors can go to any doctor or provider they choose. The change would be a boon for private health insurers — which generate massive profits and growing portions of their revenues from Medicare Advantage plans — and further consolidate corporate control over the United States health care system.

It would not likely benefit seniors, since the private plans limit the doctors they can see and often wrongfully deny patients’ care. Because the plans are costly, experts say the GOP proposal could threaten the Medicare program’s solvency.

Philip Verhoef, president of the single-payer advocacy group Physicians for a National Health Program, tells Rolling Stone it would be “disastrous” to make Medicare Advantage the default enrollment option. “To do so would be really just a clear handout to the private insurance industry,” he says.

David Lipschutz, associate director of the Center for Medicare Advocacy, says the plan would “greatly accelerate” Medicare privatization.

Project 2025, which is being spearheaded by the influential Heritage Foundation, describes its presidential transition project as “the conservative movement’s unified effort to be ready for the next conservative Administration to govern at 12:00 noon, January 20, 2025.”

Established in 1973, the Heritage Foundation has long exerted influence in GOP administrations — and perhaps never more so than in the one led by Trump. One year into his presidency, the Heritage Foundation wrote that “Trump and his administration have embraced nearly two-thirds of the policy recommendations” in its “Mandate for Leadership.”

The latest “Mandate for Leadership,” the Project 2025 agenda written by the Heritage Foundation and like-minded conservative organizations, would reshape the future of the Medicare program and push more seniors into alternative, privatized Medicare Advantage plans.

The trend toward privatization is already happening — a slim majority of Medicare beneficiaries is now enrolled in private Medicare Advantage plans. Trump helped advance this trend as president.

As The New York Times reported in 2018, during Medicare’s open enrollment period, the Trump administration emailed messages to millions of beneficiaries touting the private plans. Some of the emails included subject lines like, “Get more benefits for your money,” and “See if you can save money with Medicare Advantage.”

Trump’s administration also helped make Medicare Advantage more attractive by expanding the range of perks the plans can offer to enrollees, allowing them to add benefits such as transportation to doctors’ offices and meal delivery.

A spokesperson for Trump did not respond to questions from Rolling Stone about whether the former president supports the Project 2025 proposal.

Former South Carolina Gov. Nikki Haley, Trump’s sole remaining GOP primary opponent, has said she wants to “expand Medicare Advantage plans, which seniors love.”

Lipschutz, of the Center for Medicare Advocacy, says the Project 2025 plan would “violate the free choice of provider provision and principle of the Medicare Act, which guarantees that people will have a free choice of provider.”

Under traditional Medicare, enrollees are free to visit any doctor who accepts Medicare (nearly all physicians do). Medicare Advantage plans, by contrast, often have limited networks of doctors that patients can choose from, and many providers have stopped accepting the private plans because they so often deny the prior authorization requests they require before patients can receive services.

Lipschutz notes the Project 2025 plan says that Republicans would “give beneficiaries direct control of how they spend Medicare dollars.” He says this is “internally inconsistent” with its proposal to make Medicare Advantage the default enrollment option. Medicare Advantage plans, he says, are “tasked with managing your care, and telling you what you can and can’t do, and what is and is not covered — that is the opposite of putting beneficiaries in control of how they spend their dollars.”

It’s natural that beneficiaries might see some appeal in Medicare Advantage plans. Traditional Medicare leaves patients with significant out-of-pocket costs — which is why many enrollees in the traditional program pay for supplemental Medigap coverage. Medicare Advantage plans also promise to limit these costs. And unlike the traditional Medicare program, the private plans can offer dental, vision, and hearing benefits.

But the private plans often do not work well for sicker patients — and when they seek to leave the program and enroll in traditional Medicare, they may encounter an expensive problem: Most states allow Medigap plans to deny coverage to patients with preexisting health conditions, so these patients can get stuck with significant out-of-pocket costs.

While Medicare Advantage plans are required to pay for services covered by traditional Medicare, the government has for years flagged “​​persistent problems related to denials of care and payment in Medicare Advantage.” More recently, news reports have found the private plans are using artificial intelligence and algorithms to deny services in bulk, with extreme error rates — allegedly as high as 90 percent, according to one class action lawsuit.

The Biden administration has issued new rules and guidance to try to ensure that Medicare Advantage plans do as they are required and approve the same services as traditional Medicare. But the financial incentive to deny care is baked into the Medicare Advantage model: The private plans are given a fixed amount of money every month to provide coverage for each enrollee; paying out fewer dollars means extra profit.

Lipschutz says making Medicare Advantage the default enrollment option would “accelerate program insolvency because Medicare Advantage [costs] so much more than traditional Medicare.”

The privatized plans have, for years, systematically overbilled the government — mostly by billing the government as if their patients are sicker than they really are. The Biden administration has worked to claw back some of those past overpayments and rein in future outlays. Industry lobbyists and lawyers have aggressively fought these efforts.

MedPAC, an independent congressional advisory agency, projects that the federal government will overpay Medicare Advantage plans by $88 billion this year.

Lipschutz notes the Project 2025 plan includes a few Medicare Advantage reform ideas that could save the government money, depending on the details. However, he says, if “you increase enrollment in Medicare Advantage, you further threaten and put more pressure on Medicare’s finances.”

https://www.rollingstone.com…

Value-Based Care Failed, Let’s Admit it and Progress to Real Reform

The Congressional Budget Office found that CMS experiments in value-based care payment schemes have cost us billions over 10 years, and will continue to do so. A prominent health foundation leader says, let’s double down. We say: time to admit defeat and advocate for a single payer system.

Federal Budgetary Effects of the Activities of the Center for Medicare & Medicaid Innovation, U.S. Congressional Budget Office, September 2023

The Center for Medicare & Medicaid Innovation (CMMI) was created by the Affordable Care Act (ACA) in 2010. It conducts pilot programs, known as models, that test new ways to deliver and pay for health care in Medicare, Medicaid, and the Children’s Health Insurance Program, with the goal of identifying approaches that reduce spending or improve the quality of care.

CBO currently estimates that CMMI’s activities increased direct spending by $5.4 billion … between 2011 and 2020. …

By contrast, in 2010, when the ACA was enacted, CBO projected that CMMI would produce net savings over the 2010–2019 period. …

Looking ahead, CBO currently projects that CMMI’s activities will increase net federal spending by $1.3 billion, or 0.01 percent of net spending on Medicare … from 2021 to 2030.

The CBO Report That Didn’t Roar, KFF, January 4, 2024, by Drew Altman (KFF CEO & President)

A Congressional Budget Office (CBO) report in September slipped … largely unnoticed by the larger health community despite its potentially broad implications for efforts to promote value through popular payment changes. …

CBO found that most of post Affordable Care Act (ACA) payment and delivery demonstrations launched by the Centers for Medicare and Medicaid Innovation (CMMI) in CMS between 2011 and 2020 did not save money as intended, and cost the government $5.4 billion more than they saved, including administrative costs associated with them. CBO also projected that CMMI would be a net loser cost-wise for Medicare through 2030.

This matters because the CMMI demonstrations have been widely regarded as the leading edge of a generation of value-based payment initiatives which have become the primary cost strategy in the U.S. over the past decade, displacing what had always been the dominant schools of cost containment, competition (favored by conservatives), and regulation (favored by liberals). …

CMS’s goal remains to see every Medicare beneficiary in some form of accountable care arrangement in seven years. And recently former Health and Human Services Secretary Alex Azar called for an end to demos altogether, feeling value-based payment was the way to go. After all, Medicare spending growth has slowed in recent years. While the full explanation for that is not well understood, it’s possible that the drive towards value-based payment and accountable care has changed provider attitudes and behavior and is part of the explanation, though that is difficult to quantify. Still, Medicare spending is expected to accelerate in the future.

Back to the CBO report. Whatever the results of a particular group of demonstration projects, CMS will always need the authority to experiment with changes in its three big programs: Medicare, Medicaid, and the ACA. In a more perfect world not every demonstration would need to save the federal government money; some good things could actually cost more and might be worth investing in; for example, if they demonstrably improve access or health outcomes.

Having worked in CMS earlier in my career trying to coordinate waivers from the administrator’s office, and once been nominated to run the agency, I know the need to have a division within CMS, like CMMI, to oversee R&D activity. In fact, it would make good sense to better consolidate CMS waiver and demonstration activity across Medicaid, Medicare, and the ACA within the agency, but that’s truly inside baseball and a subject for another day.

Comment:

By Ana Malinow, M.D. and Jim Kahn, M.D., M.P.H.

The recent post by Drew Altman in “KFF Beyond the Data” spotlighted the overlooked but important Congressional Budget Office (CBO) report published in September on the budgetary effects of the Center for Medicare and Medicaid Innovation (CMMI). The report strikingly found that in its first decade, the CMMI did not reduce Medicare program expenditures, as mandated and promised, but instead cost Medicare $5.4 billion more than it saved, with ongoing losses projected through 2023.

Instead of advocating that CMS / CMMI abandon its model of using value-based care to try to fix fee-for-service, Dr. Altman makes excuses as to why only six of the 49 demonstration models produced modest savings. It goes further, wishing “equity” into existence if CMMI just integrates a “focus on equity on everything [it] does.” The evidence available suggests that VBC fails to control costs [i], improve quality, or increase equity. Defining and measuring value is extremely difficult, and as a result, CMMI pilots have little to do with value and lots more to do with cost (which, again, go up). We never have the data we need — complete, accurate, and timely. Little data, little value.

We all agree that CMS resources should be used efficiently to pay for care for enrollees. And we agree that CMS has not succeeded in that mission.

Where we disagree is what comes next. Dr. Altman supports continued experimentation with VBC. We believe that we now have ample evidence from the US and other countries that the fundamental problem is a health care system with a huge role for for-profit insurers and contracting intermediaries.

Can we (and especially Dr. Altman) say … our system is broken, resistant to real change with weak tools like value-based care, where financial incentives are primary and at odds with good care. CMS and the rest of us should follow the lead of dozens of other wealthy nations with identical comprehensive publicly mandated insurance for everyone, with no role for profit-oriented intermediaries. Time for single payer.

This represents an attack on the current system. Having someone like Dr. Altman, with his policy heft, making the argument would be revolutionary.

Can we move beyond what has failed and focus instead on improving and expanding Medicare?

[i] As discussed in the article’s comment, an updated analysis shows that MSSP further increases costs to Medicare. We’ll report on this soon.

https://healthjusticemonitor.org…

Stay informed! Subscribe to the McCanne Health Justice Monitor to receive regular policy updates via email, and be sure to follow them on Twitter @HealthJustMon.

Wealth Inequality Drives Health Inequality

This study reveals that US wealth inequality, at historic highs, creates large health inequality: a lifespan difference of 13 years between the richest and poorest. Rectifying these economic differences would raise overall longevity to levels achieved in other wealthy countries.

Wealth Redistribution to Extend Longevity in the US, JAMA Internal Medicine, January 29, 2024, by Kathryn E. W. Himmelstein, Alexander C. Tsai, Atheendar S. Venkataramani

Question: What is the association between wealth redistribution and longevity in the US?

Findings: In this cohort study of 35,164 US adults aged 50 years or older, those with low and high wealth experienced marked differences in longevity. Participants in the highest wealth decile had a hazard ratio of 0.59 for death (95% CI, 0.53-0.66) compared with those in the lowest decile, corresponding to a 13.5-year difference in survival. Simulations suggested that more equitable distributions of wealth might be associated with up to 2.2 years of additional population-level longevity, closing the gap with other OECD countries.

Conclusions: The findings of this cohort study suggest that unequal and racialized distribution of wealth in the US is associated with dramatically reduced longevity across the entire population, with particularly harmful consequences for the survival of individuals with low wealth and Black individuals in the US. Redistributive policies could greatly improve health and longevity of US residents without harming the health of individuals in the US who are currently wealthy.

Comment:

By Don McCanne, M.D.

In the United States, the wealthiest 10% of households hold over 70% of the total wealth, whereas the lower half holds less than 2%. Racial wealth inequalities are even worse. Unfortunately, this plays out in impaired access to medical care and other health risks for poor, Blacks, and Latinos – together substantially lowering life expectancy in these groups.

The good news is that we can fix this. We can redistribute wealth from billionaires and mega-millionaires, using public policies – most of all taxation. We could use much of that revenue to pay for a health care system that takes care of all of us, without the wealthy losing any health care at all. Thus, none of us would have to worry any longer about economic disadvantage reducing our life span.

https://healthjusticemonitor.org…

Stay informed! Subscribe to the McCanne Health Justice Monitor to receive regular policy updates via email, and be sure to follow them on Twitter @HealthJustMon.

An interstate compact for healthcare

By Ahmed Kutty, M.D.
Concord (N.H.) Monitor, Opinion, January 28, 2024

The concept of healthcare as a human right and its public funding have gained steady salience in our public discourse recently, thanks largely to the 2016 presidential campaign of Sen. Bernie Sanders. Since then momentum for a national health plan has stalled at the federal level.

Several state-based legislative efforts have been attempted over the last three decades, notably with California’s Proposition 197 in 1994 and the 1992 New York Health Bill. Sadly, such state bills either got killed or after passing, succumbed to gubernatorial veto; and a few are languishing in committees of the various legislatures across the country.

Vermont in 2011 came close to the finish line, but the staggering cost projections, hyped in the media by the special interest groups, provided cover for the governor to pull the rug from under it in December 2014, even though he had campaigned arduously for it. The small size of the population and its budget versus the exaggerated price estimates for a universal public plan was pronounced as the major cause of the debacle. Scaling up to a beneficiary pool of at least five million, yielding a larger revenue base was the lesson learned, opined several leading healthcare economists.

Interstate compact, a constitutional feature dating back to the colonial period, was adopted from the 1776 Confederation document into the U.S. Constitution in 1789 under Article 1, Section 10, Clause 3. This provision allows two or more states to band together to jointly execute public projects on a regional basis and for carrying out varied functions of common interest. Geographic contiguity is not required.

Nationwide, 200 compacts exist evidencing its efficacy as a governance tool. Port Authority of New York and New Jersey, created under a 1922 Compact, remains a strong and popular entity regulating regional transportation. New Hampshire is in the Northeast Water Pollution Control Commission. School districts of Rivendell and Dresden are administered under a New Hampshire-Vermont compact. 46 member states via a compact govern driver’s licensing.

In healthcare licensure for nursing, emergency medical service personnel and practitioners of telehealth under the compact mechanism is a success story. A compact among New England states with a combined population of 5 million or more, obtainable for instance with a grouping of New Hampshire, Vermont and Maine offers a regional, pragmatic and optimally-sized vehicle for publicly financing healthcare as social insurance for all residents of the region, while continuing to keep care delivery predominantly in the private sector.

Each state passing the enabling legislation to create the Compact for Healthcare will, under an interstate healthcare commission, have a compact-wide governing board and a healthcare trust fund akin to our national Medicare Trust Fund. Funds from targeted revenues for healthcare and from general funds are appropriated and aggregated into the trust fund. Premiums, deductibles, copays and coinsurance will be replaced by a progressive healthcare tax and/or surcharge, and will result in the abolition of most out-of-pocket costs at the point of service for all residents of the participating states, for all medically appropriate care.

Congressional consent, while required, is generally granted if the goals and functioning of the compact do not infringe on federal powers. A tougher nut to crack will revolve around obtaining a Congressional waiver for merging Medicare and the federal portion of Medicaid funds into the compact trust fund. Section 1332 waiver facility available under the Affordable Care Act for state-level innovations in funding and care delivery points to a potential path forward.

A bill titled ‘An Act Establishing an Interstate Compact for Universal Healthcare’ (HB 353) sponsored by Strafford Rep. Peter Schmidt in the winter of 2023, after a Commerce Committee hearing got tabled, was put on the consent calendar and met its demise early this January. The Granite State chapter of Physicians for a National Health Plan having toiled hard on this bill, with tenacity, resilience and resourcefulness will not let the story end here.

Public support and agitating for healthcare justice from the elected officials in Concord is a necessary but not sufficient condition for gaining traction. Multipronged strategies to generate the necessary political will in our elected leadership class to stand up to the moneyed interests who have captured and commodified our healthcare system, and to do the right thing are critically needed now. Gigantic efforts at ‘for-profit privatization’ of public programs like Medicare, Medicaid, veterans healthcare, long-term, rehab and mental health care, dialysis centers and several other care-giving organizations are proceeding at a breakneck pace, mostly under the radar of public awareness.

Percy Bysshe Shelley’s line, “Rise like lions from slumber…ye are many, they are few” must inspire us to act vigorously and unfalteringly for an affordable, efficient, equitable and publicly-insured system in northern New England, carrying the potential to be the catalyst for a national plan like Saskatchewan’s was for Canadian Medicare in 1962-72.

https://www.concordmonitor.com…

Dr. Samuel Dickman on MSNBC

Reproductive health researcher and Planned Parenthood of Montana Chief Medical Officer Dr. Samuel Dickman appeared on “The Katie Phang Show” on MSNBC on January 27, 2024. Dr. Dickman discussed his recent study in JAMA Internal Medicine, which estimated nearly 65,000 pregnancies related to sexual assault in the 14 states that have outlawed abortion following the overturning of Roe v. Wade.

“I wish research like this wasn’t necessary,” said Dr. Dickman, who also urged for the bans to be reversed. “I wish that sexual violence was not so common, and that survivors were able to access medical care.”

Oregon & California on Parallel Paths to Universal Unified Financing Health Care

Two West Coast states have new laws mandating universal health care plans with single payer / unified financing over the next 3-4 years. That represents massive potential for a left coast lead to real US health care reform. Let’s get to work!

Oregon SB 1089 (now enacted law)

(5) “Single payer health care financing system” means a universal system used by the state for paying the cost of healthcare services or goods in which:

(a) Institutional providers are paid directly for health care services or goods by the state or are paid by an administrator that does not bear risk in its contracts with the state;

(b) Group practices are paid directly for health care services or goods by the state or are paid by an administrator that does not bear risk in its contracts with the state, by the employer of the group practice or by an institutional provider; and

(c) Individual providers are paid directly for health care services or goods by the state, by their employers, by an administrator that does not bear risk in its contracts with the state, by an institutional provider or by a group practice.

Comment:

By Michael Lighty

The implementation of California’s Unified Healthcare Financing Act (SB 770) begins this year as Oregon ramps up its Universal Health Plan Governance Board (SB 1089) to create a universal healthcare system based on single payer financing.

Call it the West Coast Way.

In California, SB 770 mandates discussions between the State and the federal government to explore and define waivers to permit unified financing / single payer. We discussed this in HJM.

In Oregon, SB 1089 creates the Universal Health Plan Governance Board. The Board will develop an implementation plan, and then administer it. The process will create a detailed, publicly funded, single payer universal health plan. It will do in-depth research and analysis to design program details. The Board will include members with a variety of expertise and backgrounds. It will present the plan to the state legislature, so implementation could start as soon as 2027 (though note need for ballot referenda below).

In both states, there is a clear requirement for a single source of payment for all healthcare services. This follows the recommendations of the Healthy California for All Commission, and Oregon’s Universal Healthcare Task Force. CA SB 770 (Sec. 1 Part 4 1001 (q)) and OR SB 1089 prohibit risk-bearing contracts and financial incentives to deny care. A key issue for both plans is the role, if any, of integrated delivery systems, benefit funds, and third-party administrators.

The detailed policy development beginning this year by the UHP Governance Board in Oregon and the California Department of Health Services will lead to discussions with the federal government, specifically the Center for Medicare and Medicaid Services, over the terms of federal financial support and approval of the universal healthcare system in each state. This “Waiver” of existing federal rules will then form the basis of final approval by the respective state legislatures likely in 2026. In both states, voters will have the final say on how the programs will be financed, as early as 2028.

These efforts are the most advanced and strategic approaches to determining what it actually takes and implementing a plan to achieve guaranteed healthcare through single-payer financing. Major questions to address include: the role of Medicare in relation to state universal health care programs, how employee benefit funds relate to the new programs, and how the federal ERISA law governing employer provided benefits impacts these state programs. These and other issues must be resolved in order to redirect federal funds currently used to support healthcare in the state into the new universal healthcare programs.

Both states decided to lay out the principles that govern the design of a universal healthcare system, and to finalize the details based upon discussions with the federal government before asking the legislature to approve a full-blown program and financing. That is different from prior efforts to pass the program and then talk to the federal government.

After decades of unsuccessful legislative and ballot initiatives in Oregon and California, advocates are optimistic about this new strategy. Answering political, technical, and legal questions up front can preempt any excuse avowed supporters of universal healthcare may cite to oppose single payer.

Will it succeed? We are some years away from knowing, but the political impact is encouraging. Building a coalition that includes the full range of health reformers from single payer advocates to those working for coverage and access expansion, along with unions and policymakers, has enabled the progress so far. This strategic approach to policy creates a political momentum that could be the missing piece to finally winning guaranteed, efficient, and equitable healthcare. The West Coast can lead the way.

https://healthjusticemonitor.org…

Stay informed! Subscribe to the McCanne Health Justice Monitor to receive regular policy updates via email, and be sure to follow them on Twitter @HealthJustMon.

Who is most efficient in health care? Surprise, it’s the VA

This new study finds that in the Veterans Health Administration (VA) 22.5% of personnel are administrative or clerical, vs. 29.3% for the rest of the health care system. If non-VA insurers and providers echoed VA staffing, they would need 900,000 fewer administrators and clerks, sharply reducing administrative costs. Single payer efficiency gains would be even greater.

Administration’s Share of Personnel in Veterans Health Administration and Private Sector Care, JAMA Network Open, January 18, 2024, by Steffie Woolhandler, Andrew Toporek, Jian Gao, Eileen Moran, Andrew Wilper, and David U. Himmelstein

“Nearly 4 million people were employed in health care administration in the private sector (excluding long-term care) in 2019, a number that would have decreased by nearly 900 000 individuals had staffing patterns followed those of the VHA. …

The VHA’s leaner administrative staffing likely reflects the agency’s simpler financing scheme. … [Private sector] health care institutions bill for individual patients and services and interact with insurers that have varying fee schedules, deductibles, prior-approval requirements, formularies, and referral networks. . . . Even capitation payment schemes generally entail risk-adjustment calculations requiring detailed tracking of each patient’s service use, diagnoses, and costs. In this context, investments in administration may make financial sense, for example, increasing revenue by documenting more diagnoses. Financial success is key to private sector institution growth and even survival, and executive compensation is often linked to financial metrics. This could incentivize efforts to improve efficiency but could also encourage revenue-enhancing administrative activities that add little clinical value (eg, marketing and upcoding).

In contrast, VHA hospitals and clinics are funded mostly through lump-sum budgets. The VHA does not bill Medicare or Medicaid and collects only 2.7% of its revenues from private insurers and 0.3% from patients, minimizing the need to attribute costs and charges to individual patients. In the VHA, all facilities are in network, 1 formulary applies to all patients, and few services require prior authorization. While managers must adhere to budgetary constraints and provide a volume of clinical services commensurate with their budgets, incentives based on financial metrics are minimal for hospital leaders and their institutions.

The difference in administration’s share of personnel in the VHA vs the US private sector that we found (6.8 percentage points) appears smaller than administrative cost differences between the US and single-payer nations; for example, there was a 13.2 percentage point disparity in hospital administrative costs and a 17.4 percentage point difference in system-wide administrative costs between the US and Canada. Several factors may account for the VHA’s less streamlined administration; unlike in Canada, where all residents are automatically and equally eligible for care, the VHA must determine eligibility based on veteran disability level, veteran income, and other factors. Additionally, the VHA serves as an insurer for some non-VHA care, spending approximately 20% of its budget purchasing private sector care.”

Comment:

By David Himmelstein, M.D. and Steffie Woolhandler, M.D., M.P.H.

In this study we and our colleagues analyzed data on employment and occupation from a Census Bureau survey of 3.2 million Americans, including 122,315 who worked in private sector and VA hospitals, clinics and medical offices. We grouped all health care occupations into 18 categories, three of them administrative, and applied the same classification criteria to VA and private sector health care workers. We gleaned additional data on health insurance employees from the Bureau of Labor Statistics, and data on employees in the VA Central Office from VA employment records.

Doctors and hospitals waste hundreds of billions each year on useless paperwork. Most of that is inflicted by profit-seeking insurers, who try to avoid paying for care by imposing complex coverage rules and documentation requirements. And our profit-oriented system also rewards providers for devoting more resources to gaming the payment system.

Some VA colleagues complain that the system has rigid rules and too much bureaucracy. But its simplified payment scheme saves so much time and effort that it’s still far more efficient than private sector care. Comparisons with other nations indicate that even greater efficiency is possible under a universal, single payer system.

Previous studies have shown that VA care is as good or better than care in the private sector. We now know that the VA is also more administratively efficient, because patient care – not money – is at the center of its mission.

https://healthjusticemonitor.org…

Stay informed! Subscribe to the McCanne Health Justice Monitor to receive regular policy updates via email, and be sure to follow them on Twitter @HealthJustMon.

Rape-Related Pregnancies in the 14 US States With Total Abortion Bans

By Samuel L. Dickman, M.D.; Kari White, Ph.D.; David U. Himmelstein, M.D.; Emily Lupez, M.D.; Elizabeth Schrier, M.D.; Steffie Woolhandler, M.D., M.P.H.
JAMA Internal Medicine, January 24, 2024

Many US women report experiencing sexual violence, and many seek abortion for rape-related pregnancies. Following the US Supreme Court’s 2022 Dobbs v Jackson Women’s Health Organization (Dobbs) decision overturning Roe v Wade, 14 states have outlawed abortion at any gestational duration. Although 5 of these states allow exceptions for rape-related pregnancies, stringent gestational duration limits apply, and survivors must report the rape to law enforcement, a requirement likely to disqualify most survivors of rape, of whom only 21% report their rape to police.

Post Dobbs, 10 or fewer legal abortions occurred monthly in each of the total abortion ban states. We estimated rape-related pregnancies by state to assess how abortion bans affected survivors of rape.

Results: In the 14 states that implemented total abortion bans following the Dobbs decision, we estimated that 519,981 completed rapes were associated with 64,565 pregnancies during the 4 to 18 months that bans were in effect. Of these, an estimated 5,586 rape-related pregnancies (9%) occurred in states with rape exceptions, and 58,979 (91%) in states with no exception, with 26,313 (45%) in Texas.

full study:
https://jamanetwork.com…