PNHP

Here they come again: Broader health care debate for 2016

Here they come again: Broader health care debate for 2016

By Ricardo Alonso-Zaldivar
WNYT.com (Albany, N.Y.), Oct. 2, 2015        

WASHINGTON (AP) — After seven years of the political drama known as “Obamacare,” you might think voters would be tired of big ideas for revamping health care. If so, the presidential candidates seem to have missed the memo.

The 2016 hopefuls in both parties are offering a full spectrum of options, from a system wholly run by the federal government to dialing back Washington’s lead role. Much is promised by the candidates, but each approach has pitfalls.

On the left, part of the appeal of Vermont independent Sen. Bernie Sanders is his years-long advocacy of “single payer,” a tax-supported, Medicare-like plan for all. The idea is in the political DNA of liberals, and Sanders as president would lead a movement to make it happen, his campaign says.

On the right are the Republicans, united on repealing President Barack Obama’s health care law, but unable to agree on what they would replace it with. They wouldn’t stop with the Affordable Care Act, either. Republicans also want curbs on Medicaid, to reduce spending and let states, not Washington, set the tone. Medicaid covers low-income and disabled people.

In the middle — if one still exists on such a polarized issue — is Democrat Hillary Rodham Clinton. She would keep the basic structure of Medicare, Medicaid and the Obama health law while making incremental changes. This week she proposed repealing an insurance tax in the health law that’s opposed by unions and big business but seen by experts as a needed brake on costs. She also wants to curb prescription drug prices and limit insurance cost-shifting to consumers.

“The only person not in favor of ‘repeal and replace’ is Hillary Clinton,” quips Republican economist Douglas Holtz-Eakin. “There is a debate being presented to the American people: Do you want to go further left, or do you want to go in the direction conservatives are advocating? The person who is basically arguing for the status quo is Hillary Clinton.”

A look at the three approaches, and their potential drawbacks:

SINGLE PAYER

If Sanders keeps gaining traction, the wonkish term for a government-run health care system could become a household word. His supporters say Obama’s hard-fought health overhaul hasn’t done nearly enough.

“People are still one illness away from becoming bankrupt,” said Dr. Deb Richter, who practices near Montpelier, Vermont, and focuses on addiction treatment. “Obamacare was hyped as this savior, and it has not been that.”

Supporters say having the government take charge of health care finances would slow the growth of spending, keep things affordable for patients, and improve overall quality.

A major pitfall is the switch from employer-based and private coverage to the single-payer plan. Money that employers and individuals now pay for premiums would have to be diverted to government coffers — a massive tax increase.

“It’s a dead end,” said Princeton sociologist Paul Starr, a historian of the U.S. health care system. Supporters “don’t face up to the significant tax changes that would be necessary.”

REPEAL AND REPLACE

The Supreme Court upheld Obama’s law, and the president won re-election in 2012. That didn’t settle the debate, but 2016 may.

“For Republicans it’s their last chance to litigate the Affordable Care Act,” said Jim Capretta, an expert on entitlement programs at the conservative Ethics & Public Policy Center in Washington. “If they lose the election, the ACA is likely to become even more entrenched.”

‘Repeal’ is a winning issue with the GOP’s political base, but the ‘replace’ part gets tricky because Republicans don’t agree on an alternative. In the general election, the GOP counterproposal will be measured against the health care law’s progress in reducing the number of uninsured. A plan that repeals federal mandates and reduces insurance subsidies would probably leave more people uncovered.

Republican front-runner Donald Trump says his replacement plan would be different. He’d make sure everybody in the country is covered, something not even Obama accomplishes. Trump says he’d make a deal with hospitals, and most people would still have private coverage.

“There is not nearly enough to go on from Trump’s statements to assess what he actually has in mind,” said Capretta.

But the biggest pitfall for Republicans could be Medicare, not “Obamacare.” The party has previously advocated privatizing the insurance program for older Americans. In 2016, that would be asking for trouble.

“Seniors have been tilting Republican in the last elections,” said Robert Blendon, a public opinion expert at the Harvard T.H. Chan School of Public Health. “The only thing that could get them to tilt the other way is a Medicare proposal.”

CONTINUITY, MOSTLY

Hillary Clinton established her credentials on health care in the 1990s, although she and her husband, then-President Bill Clinton, failed to pass the overhaul legislation they proposed. She lost the 2008 Democratic nomination to Obama, but he adopted key parts of her health plan.

This time, Clinton is promising to build on Obama’s coverage expansion and smooth its rough edges, while keeping Democrats’ traditional commitment to Medicare and Medicaid.

The drawback is that Clinton’s middle way may be seen as uninspiring. “I think there is a hunger among Democrats to see something more happen,” Blendon said.

http://wnyt.com/article/stories/s3923639.shtml

Can Sec. 1557 be used to prevent discriminatory adverse tiering?

The Section 1557 Regulation: What’s Missing, And How We Can Include It

By Douglas Jacobs
Health Affairs Blog, September 21, 2015

Kristin Agar, a 63-year-old social worker, was diagnosed with lupus in 2008, a rare disease in which the body’s own immune system can cause serious damage to the kidneys, brain, skin, and joints. Unfortunately, despite having insurance coverage, Kristin has found that the drug she needs to treat her lupus is unaffordable. All around the United States, Kristin joins other patients with chronic conditions like HIV, Hepatitis C, Multiple Sclerosis, Rheumatoid Arthritis, and Leukemia, who are having trouble paying for their medications.

In June, Robert Restuccia and I wrote a Health Affairs Blog post showing that discrimination in our health care system is evolving. Some insurers that once refused outright to offer coverage to patients like Kristin are now resorting to more surreptitious means to discourage enrollment, like increasing the cost of all medications for certain conditions. This practice, called “adverse tiering,” has been regulated under Section 1302 of the Affordable Care Act (ACA), which grants the Department of Health and Human Services (HHS) the authority to define essential health benefits under the ACA.

However, the Section 1302 regulation has so far been limited. The rule states that adverse tiering may be discriminatory, but also appears to allow an exemption for expensive drugs like Kristin’s lupus medication. Additionally, insurers that are “caught” practicing adverse tiering only have to provide written justification for their actions to HHS or comply by fixing their benefit design.

Even without practicing adverse tiering, insurers could discourage the most expensive beneficiaries from enrolling by increasing the cost of wheelchairs, nursing homes, or even specific surgeries. If HHS wanted to categorize any future insurance practices as discrimination under Section 1302, the regulatory process could take years. As such, these new forms of discrimination have prompted many to call on the Obama Administration for a stronger response.

The Section 1557 Regulation

Earlier this month, over five years after the Affordable Care Act was adopted, the Obama Administration finally proposed the highly anticipated rule that implements the ACA’s main nondiscrimination provision: Section 1557. The rule prevents discrimination on the basis of race, color, national origin, sex, age, and disability, and broadly applies to all health programs and activities that receive assistance through HHS.

For those who have experienced discrimination in its many forms, the regulation includes a number of provisions to protect consumers. Each health entity must provide appropriate aids and services to those with limited English proficiency and disabilities. The rule extends protections for transgender persons unlike ever before, including it as a form of sex discrimination. Furthermore, all services must be made available for gender transition (like a hysterectomy) that are available to a person seeking non-transition related care. All transgender persons must be treated consistent with their own gender identity.

The proposed rule also establishes a private right of action, giving individuals the ability to file a lawsuit under Section 1557 (courts had already begun to authorize private Section 1557 lawsuits, but this makes it official). This is an important step forward, because unlike the Section 1302 regulation, insurers will be highly motivated to comply with the 1557 regulation or face costly litigation. Insurers will think twice about changing their benefit design to discourage enrollment by individuals of a certain race, color, national origin, sex, age, and disability. Instead of taking years to pass a new regulation, a private cause of action allows the justice system to “keep pace” with quickly evolving insurer practices.

However, these positive developments are tempered by some noticeable omissions. Namely, the rule is conspicuously silent about discrimination on the basis of health status. As Timothy Jost stated in his recent post, “Surprisingly, the proposed rule does not directly address one of the most salient current discrimination questions: whether insurers can impose high cost sharing or otherwise limit access to expensive drugs needed by certain disabled populations.”

Kristin Agar, who can’t afford her lupus medication, may not be assisted by the Section 1557 regulations. Insurers could continue to discourage enrollment by the sickest consumers through manipulation of their benefit designs.

Without directly addressing the issue, HHS seems to have made a distinction between two different types of discrimination: discrimination by categorically excluding certain individuals from care, and discrimination by “pricing out” certain enrollees by making specific services unaffordable. In other words, making drugs or services unaffordable seems to be an effective way for insurance companies to discourage enrollment and improve their bottom lines.

The reticence to address “price-based” discrimination likely stems from insurers historically charging different prices for medications and services. Insurers argue that this pricing structure allows them to encourage the use of more low-cost services and medications.

However, this omission even has the potential to undermine the very forms of discrimination that the proposed Section 1557 regulation aims to protect against. For example, despite the new transgender protections in the rule, plans could still discriminate against transgender people by making hormonal treatments and transition-related care unaffordable. A plan could more broadly still discriminate on the basis of sex by increasing costs for medications predominantly used by women (like breast cancer treatment), increasing costs for pregnancy care, or severely limiting the number of gynecologists in the plan network. It is clear that in order to have a strong Section 1557 regulation, HHS must also address cost.

A Way Forward

HHS should adopt a standard way of addressing cost-based discrimination in the final Section 1557 rule. When does changing the cost of a drug or service make it “unaffordable,” thus discouraging enrollment and constituting discrimination? The answer to this question appears in other ACA regulations.

The Internal Revenue Service (IRS) defines “unaffordable” in the ACA as a percentage of income, which could set a standard for price-based discrimination as well. An “unaffordable” medication or service would become discriminatory if there is no lower-cost, but similarly efficacious drug or service. This would preserve an insurer’s ability to encourage the selection of lower cost drugs and services, while still protecting consumers from discriminatory pricing schemes. Even if the final Section 1557 regulation does not include cost-based discrimination, standards of discrimination may evolve with ongoing litigation. As individuals increasingly file Section 1557 cases, it is entirely possible that courts will find cost-based discrimination unlawful.

However, Kristin Agar and others with chronic conditions need more than a federal regulation recognizing cost-based discrimination: HHS should ban discrimination on the basis of health conditions in their final rule. HHS has the authority to interpret Section 1557 broadly as part of an overall statutory and regulatory regime to make health care more accessible to those who need it the most, and also have the responsibility to counter long standing and pervasive discriminatory practices by insurers.

In the absence of an explicit ban, another way to achieve Section 1557 protection against discrimination is for HHS or courts to categorize certain diseases as “disabilities.” Courts have historically been reluctant to do this, defining a “disability” as being restricted to an “impairment that substantially limits one or more major life activities.”

However, this was before the passage of the Americans with Disabilities Act Amendments in 2008, and the subsequent final rule in 2011 that broadened the definition of disability to include impairments to bodily functions (such as the immune system, special sense organs, normal cell growth, and digestive, genitourinary, neurological, bowel, respiratory, cardiovascular, endocrine, hemic, lymphatic, musculoskeletal, and reproductive functions, among others). Since the amendments passed, courts have more broadly interpreted “disability,” although they continue to assess each case individually. This relatively untested new version of disability could include protections for Kristin and many others with chronic conditions under Section 1557.

Until HHS or a court decides, those with health conditions will continue to rely on the slow, partial protections of Section 1302. Kristin deserves a better system. She deserves a system that prospectively bans discrimination on the basis of her race, color, national origin, sex, age, disability, and health, either by being excluded from insurance plans or by being priced out of them. Kristin deserves to be able to file suit when she is being discriminated against. Kristin deserves to be covered by Section 1557.

http://healthaffairs.org/blog/2015/09/21/the-section-1557-regulation-whats-missing-and-how-we-can-include-it/

***

Nondiscrimination in Health Programs and Activities

Federal Register, September 8, 2015

Summary

The Department of Health and Human Services (HHS or “the Department”) is issuing this proposed rule on Section 1557 of the Affordable Care Act (ACA) (Section 1557). Section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in certain health programs and activities. Section 1557(c) of the ACA authorizes the Secretary of the Department to promulgate regulations to implement the nondiscrimination requirements of Section 1557. In addition, the Secretary is authorized to prescribe regulations for the Department’s governance, conduct, and performance of its business, including, here, how HHS will apply the standards of Section 1557 to HHS-administered health programs and activities.

https://www.federalregister.gov/articles/2015/09/08/2015-22043/nondiscrimination-in-health-programs-and-activities

***

Comment:

By Don McCanne, MD

Insurers will always try to find a way to avoid paying for health care whenever they can. This article explains “adverse tiering” – an innovation by the insurers wherein needed services or products used by individuals with high-cost disorders are placed in a higher tier of coverage in which patient cost sharing is much higher. This adverse tiering is being used by insurers to discourage enrollment in plans by people with disorders such as HIV, hepatitis C, multiple sclerosis, rheumatoid arthritis, or leukemia.

Section 1557 of the Affordable Care Act (ACA) – the nondiscrimination section – states that an individual shall not “be excluded from participation in, be denied the benefits of, or be subjected to discrimination under, any health program or activity, any part of which is receiving Federal financial assistance, including credits, subsidies, or contracts of insurance, or under any program or activity that is administered by an Executive Agency or any entity established under this title (or amendments).”

After five years, HHS has finally released a proposed rule for Section 1557 nondiscrimination under ACA. As Douglas Jacobs explains in the Health Affairs Blog, the proposed rule does not seem to adequately address adverse tiering discrimination. Banning such discrimination can be technically challenging since price tiering is encouraged by some in the policy community as a means of discouraging patients from receiving expensive care that they do not really need (the rhetoric of advocates of consumer-directed health care). Another possibility that Douglas Jacobs suggests is that the proposed rule could be modified to enable lawsuits under the amended Americans with Disabilities Act (ADA).

After reviewing the 200 page proposed rule and considering the complexities of defining how adverse tiering discrimination could be banned while still leaving tiering in place, or considering the complexities of lawsuits under ADA, even in defining whether these expensive conditions are disabilities, it does seem clear that these approaches further increase the wasteful administrative excesses that already plague our heath care system.

In contrast, a single payer national health program would eliminate cost sharing thereby eliminating the insurers’ tool of adverse tiering, not to state the obvious of eliminating the insurers themselves. Life for patients and their health care professionals would be so much simpler.

School of Medicine holds rally, vigil in support of Medicare

By Amanda Kaufman
The Daily Free Press (Boston), Oct. 2, 2015

Joining 30 other universities around the nation, the Boston University School of Medicine hosted a Medicare-for-All National Day of Action rally Thursday to advocate for single-payer health care reform. BU was the only university in Massachusetts to participate.

Organizers and attendees of the rally used the hashtag #TenOne, representing Oct. 1, on social media to spread the word about the cause and connect with the other universities.

BUSM students, professors and policymakers gathered on BU’s Medical Campus to discuss the current inadequacies of the United States’ health coverage system and to raise support for Medicare reform.

The rally ended with a candlelight vigil to honor the lives lost due to the lack of affordable healthcare. The rally’s attendees held candles and colorful posters decorated with phrases such as “Help heal American healthcare!” and “Patients over Profits,” while also participating in a thirty-three second moment of silence to honor the thirty-three million Americans that remain uninsured.

Students for a National Health Program, the student branch of Physicians for a National Health Program, organized the rally.

Clara Zhu, one of the event’s chief organizers and a second-year BUSM student, said when organizing the event, the group wanted to focus on bringing together a variety of people to discuss the lack of healthcare in American and how it has affected patients.

“We have attending physicians, residents, lawmakers, people who specialize in policy and, of course, medical students, and the idea there is that when you have a problem that is so large, that’s so entrenched in our culture, it’s important to be able to have allies from different fields to be able to approach that problem,” she said.

Zhu said America’s hesitance toward single-payer health care in comparison to several other established nations around the world is astonishing.

“Every other major industrialized nation has government-supported healthcare and manages to insure its citizens,” she said. “The United States is the wealthiest nation in the world and somehow still a massive portion of our citizens are uninsured or underinsured.”

Jawad Husain, a third-year BUSM student, said the rally was partly inspired by last year’s White Coat Die-Ins movement, which highlighted police brutality in America.

Over 60 BUSM students participated in White Coat Die-Ins last December in support of the Black Lives Matter movement. The rally was mirrored at 75 other medical schools across the nation, he said.

“[Medicare-for-All] was inspired by what we saw as a big increase in medical student organizing after the Black Lives Matter movement,” Husain said. “We were really inspired by the mobilizing of social media and coordinating a day of action across multiple schools, so that’s how this event came to be.”

Janine Petito, a third-year BU medical student, said there’s a large amount of support among students to start working on real healthcare reform. She said as medical students, they realize they have a lot of privilege and access to a patient population that the rest of the world does not have.

“There’s enough stress that comes along with any illness, whether it’s a broken foot or terminal cancer, and the fact that you could be financially ruined by a diagnosis that’s completely out of your control is outrageous,” Petito said.

First-year BU medical student Alex Iwamoto said the current healthcare system is a mess that has to undergo a lot of change.

“It’s going to be really hard through a lot of incremental change to get to something like single-payer healthcare, I don’t know exactly what it’s going to take,” he said. “Our current system costs a lot of money yet is wildly inefficient.”

School of Medicine holds rally, vigil in support of Medicare

Medical Students Nationwide Rally for Medicare for All

By Robert Lowes
Medscape, Oct. 1, 2015

Hundreds of medical students in at least 16 states plan to demonstrate into the evening today in favor of extending Medicare coverage to all citizens, which would amount to a single-payer healthcare program for the United States.

The schedule of events include marches and teach-ins as well as candlelight vigils in honor of the estimated 35,000 American adults whose deaths last year, organizers said, could have been prevented had those individuals possessed health insurance coverage.

Today’s activism springs from the Students for a National Health Program (SNaHP), an arm of Physicians for a National Health Program. SNaHP has roughly 800 members in chapters at 43 US medical schools, according to Scott Goldberg, a member of the Physicians for a National Health Program board of directors and a fourth-year student at the University of Chicago Pritzker School of Medicine in Illinois. Most of the chapters are participating in what’s called the Medicare-for-All National Day of Action, which also goes by the Twitter hashtag #TenOne.

Joining SNaHP in the Medicare-for-All National Day of Action are:

  • the American Medical Student Association;
  • the Latino Medical Student Association;
  • Universities Allied for Essential Medicine;
  • Pre-Health Dreamers, consisting of undocumented students preparing for healthcare careers; and
  • #WhiteCoats4Black Lives, a group of medical students who conducted a nationwide “die-in” last year to protest police brutality against blacks.

The Medicare-for-All National Day of Action is timed to coincide with the 50th anniversary of Medicare, but not today’s debut of the International Statistical Classification of Diseases and Related Health Problems, 10th Revision, diagnostic codes, which has healthcare in a dither. “It happens to be a coincidence,” “Goldberg told Medscape Medical News.

Bryant Shuey, a second-year student at the University of New Mexico School of Medicine, who is helping organize #TenOne activities there, said his nascent clinical experiences have strengthened his belief in a single-payer system. Working in a family medicine practice, Shuey encountered a 65-year-old man who had just become eligible for Medicare. Up until that point, the patient had put off seeing a physician for years on account of the expense.

“He had a mass in his abdomen, weight loss, and changes in his stools,” Shuey told Medscape Medical News. “We ran tests and found out that he had colon cancer. It had pretty much progressed past the point of therapy.”

Blue State Tilt?

Tonight in Chicago, students from five local medical schools will hold a “funeral march” to commemorate uninsured patients who died of preventable causes as well as the hoped-for death of the private health insurance industry, “which places profits above patients,” Goldberg said. The march will end in front of an office for health insurer Humana, where participants will hear speeches and light candles.

“It’s an appropriate place to have it,” Goldberg said.

Press materials from SNaHP state that at least 36 chapters in 16 states intend to conduct marches and rallies today. Most of the 16 states are in the Northeast, North Central, and West Coast sections of the country, and all but two were blue states in the 2012 presidential election. By and large, #Ten10 is skipping over the South, the Great Plains, and the West, which are Republican bastions.

Goldberg said the national map for the National Day of Action reflects not so much political differences as it does the growth of SNaHP.

“We’ve only been around for 4 years,” he said. “Definitely there are chapters in Blue states that are maybe easier to recruit [in], but over the last 6 months to a year, a lot of growth has come from red states.” He pointed to a chapter that has just formed at the Washington University School of Medicine in St. Louis, Missouri.

“It’s not a red state or blue state issue. Medical students are entering into this profession because they see it as a service profession and they want to do what’s best for their patients.

“Clearly single-payer is the most evidence-based and comprehensive way to provide for all patients, regardless of their income or their race or ethnicity.”

http://www.medscape.com/viewarticle/852017

Academic leaders corrupting themselves in the medical-industrial complex

Prevalence and compensation of academic leaders, professors, and trustees on publicly traded US healthcare company boards of directors: cross sectional study

By Timothy S Anderson, Chester B Good, Walid F Gellad

BMJ, September 29, 2015

Abstract

Objective: To identify the prevalence, characteristics, and compensation of members of the boards of directors of healthcare industry companies who hold academic appointments as leaders, professors, or trustees.

Design: Cross sectional study.

Setting: US healthcare companies publicly traded on the NASDAQ or New York Stock Exchange in 2013.

Participants: 3434 directors of pharmaceutical, biotechnology, medical equipment and supply, and healthcare provider companies.

Main outcome measures: Prevalence, annual compensation, and beneficial stock ownership of directors with affiliations as leaders, professors, or trustees of academic medical and research institutions.

Results: 446 healthcare companies met the study search criteria, of which 442 (99%) had publicly accessible disclosures on boards of directors. 180 companies (41%) had one or more academically affiliated directors. Directors were affiliated with 85 geographically diverse non-profit academic institutions, including 19 of the top 20 National Institute of Health funded medical schools and all of the 17 US News honor roll hospitals. Overall, these 279 academically affiliated directors included 73 leaders, 121 professors, and 85 trustees. Leaders included 17 chief executive officers and 11 vice presidents or executive officers of health systems and hospitals; 15 university presidents, provosts, and chancellors; and eight medical school deans or presidents. The total annual compensation to academically affiliated directors for their services to companies was $54 995 786 (£35 836 000; €49 185 900) (median individual compensation $193 000) and directors beneficially owned 59 831 477 shares of company stock (median 50 699 shares).

Conclusions:  A substantial number and diversity of academic leaders, professors, and trustees hold directorships at US healthcare companies, with compensation often approaching or surpassing common academic clinical salaries. Dual obligations to for profit company shareholders and non-profit clinical and educational institutions pose considerable personal, financial, and institutional conflicts of interest beyond that of simple consulting relationships. These conflicts have not been fully addressed by professional societies or academic institutions and deserve additional review, regulation, and, in some cases, prohibition when conflicts cannot be reconciled.

From the Introduction

As the for profit healthcare industry and academic medicine have grown closely intertwined, financial relationships between industry and academia and the risks of conflicts of interest have come under scrutiny. Physicians and the media have highlighted concerns that secondary financial interests of individuals and companies may create an undue influence on primary patient care, research, and education goals.

The attention of professional guidelines and the media has primarily focused on researchers and clinicians who receive financial payments for conducting industry research, providing consulting services, and giving promotional lectures. Less attention is paid to academic individuals who also serve on the boards of directors of for profit healthcare companies. Boards of directors are elected by shareholders annually, with responsibilities including oversight of executive officers, setting major strategic initiatives, and handling major financial decisions such as mergers. Similar to individuals engaging in consulting relationships, directors on industry boards enter a formal contract with the company and receive financial payment for services; however, they are subject to two important differences. Firstly, unlike consultants who are compensated to provide expertise on a specific issue, directors are subject to a fiduciary responsibility to company shareholders to advance the general interests of the company and increase profits. Secondly, directors are reimbursed both through larger cash fees than typical consulting contracts and through stock options, the value of which is directly tied to the financial success of the company. Serving as a director has largely been unaddressed in professional society guidelines.

Though the missions of academia and for profit companies can overlap, they may also diverge, specifically when the for profit mission of industry competes with the non-profit taxpayer funded clinical and research missions of academic medical and research institutions.

From the Discussion

Overall, 85 non-profit academic institutions, including many of the most renowned medical research and clinical centers had at least one leader, professor, or trustee who served as a director for a for profit healthcare company. The academic roles of directors ranged from clinical and research professors to trustees of academic institutions and hospitals to a large collection of senior leadership, including 17 health system chief executive officers and eight medical school deans. Directors received considerable cash compensation and owned a median of 50 000 stock shares tied to company performance. The dual obligations to industry and academia that these individuals hold create important conflicts of interest when the missions of their institutions diverge, while at the same time offering potential benefits when the missions overlap. Approaches to managing these competing interests have not been fully addressed in professional ethical guidelines.

Financial relationships between US academic leadership and the pharmaceutical industry have been well documented. A 2006 survey of department chairs found 60% of respondents had a relationship to industry, with 11% serving on a company board of directors. A 2009 study of medical school deans documented nine deans who served on company boards of directors, with a median compensation of over $200 000. We previously documented US academic leadership that held directorships at 19 of the 47 largest global pharmaceutical companies. This study extends the scope of our understanding of these dual roles in three key ways: by using company reported data to examine 99% of publicly traded US healthcare companies across all sectors, examining a wider spectrum of academically affiliated individuals beyond leaders, and providing a more detailed examination of the magnitude of financial relationships, including stock ownership.

http://www.bmj.com/content/351/bmj.h4826

***

Comment:

By Don McCanne, MD

For decades, Arnold (Bud) Relman had warned us about the medical-industrial complex that displaces the noble traditions and ethics of medicine in which patient service is paramount with the business model of health care in which patients become a means to build models in which success is measured by profits and stock performance. Did we listen?

One need only look at the behavior of pharmaceutical firms, for-profit hospital chains, private investor-owned insurance companies, medical device manufacturers, and other components of our health care system to recognize that we have been moving in the wrong direction. Even the architects of the Affordable Care Act ignored Dr. Relman’s call by expanding taxpayer support of the predominantly investor-owned private insurance industry, enhancing their performance in the stock markets, by enabling pharmaceutical firms freedom to charge outrageous prices, greatly increasing their profits, by motivating hospitals to consolidate, giving them greater market leverage, and by a massive infusion of funds into Medicaid programs as control is being transferred to private, investor-owned managed care organizations.

One would hope that our academic institutions, as centers of medical education, research, and patient care would take the lead in moving away from the commercialization of health care and, instead, reinforce the traditional values of the healing arts. Is there hope in today’s message?

We learn that the leaders, professors and trustees of our academic institutions are joining the boards of directors of for-profit health care companies. To assuage any disconcerting reservations they may have over their conflicts of interest, they are being soothed with cash (median $193,000 annually) and stock (median 50,000 shares). Whoa. What does that bode for the future when our newly minted professionals are groomed in this environment?

How does this comport with Bud Relman’s letter to his physician colleagues (A Second Opinion, 2007)? “Our failing, inequitable, and unaffordable health system will be reformed because it must be; because nothing else short of a major overhaul will do the job that a majority of citizens want done. It may begin as an extension of Medicare benefits to people below sixty-five, or as a trial of a new single-payer insurance system in one or more states, or there may be enough popular support to enable passage of landmark legislation that reshapes the entire system nationwide. Much of what happens in the near term will depend on what you decide to do.”

Health professions students want ‘Medicare for all’

By Jordan Centers
Illinois Single-Payer Coalition, Oct. 1, 2015

Despite the Affordable Care Act’s undeniable success in extending health coverage to more people and in curbing some of the health insurance industry’s worst practices, recent reports show our nation still has 33 million people who are uninsured, a comparable number who are inadequately insured, sharply rising deductibles and copays, and skyrocketing pharmaceutical drug prices.

The 2010 health law clearly did not go far enough.

Students in the health professions see this grim picture and want to do something to fix it. On Thursday, Oct. 1, here in Chicago – in tandem with students on more than 30 university campuses nationwide – health professional students will speak out against the continuing calamity in U.S. health care and call for an effective remedy: an expanded and improved Medicare for all Americans.

Such a fundamental reform is urgently needed.

The U.S. is the only industrialized nation without a system of national coverage. As a result, many Americans go bankrupt when they get sick. In fact, according to one study, more than 60 percent of personal bankruptcies in the U.S. are linked to illness and medical bills.

Even if you have insurance, you’re not safe: that same study showed that nearly 80 percent of those medical bankruptcies occur to those who are already insured.

Americans pay more for health care than anyone in the world, and yet in many categories our medical outcomes are subpar. Still worse: according to another study, an estimated 45,000 Americans die each year due to lack of coverage.

Our private-health-insurance “system,” which the ACA reinforced, is clearly failing us.

In contrast, since its inception over 50 years ago, Medicare has provided reliable, effective coverage for all Americans over 65. It’s not perfect. Despite its strengths, Medicare still requires too much cost-sharing and has too many coverage gaps. This is precisely why we are calling for an expanded and improved Medicare for all.

A single-payer, Medicare-for-All system would expand comprehensive health care coverage to everyone in the United States. Patients would have free choice of physicians and other clinicians, hospitals, and inpatient care facilities. There would be no copayments, deductibles, or coinsurance.

Rather, all services would be paid for by a national insurance fund, which would be funded through existing federal monies spent on care and on a system of progressive taxation. One study says such a plan would save 95 percent of U.S. households money.

While health care would be publicly financed, services would still be delivered by both public and private providers.

Having many payers, as we do now, is extremely inefficient. A 2003 study in the New England Journal of Medicine estimated that administration and bureaucracy consumes 31 percent of all health care expenditures in the U.S., most of it waste. Adopting a streamlined single-payer system would save more than $375 billion annually, money that we could redirect to care.

Additionally, a single payer would be able to negotiate much more effectively with pharmaceutical and medical supply companies for fairer prices, helping to slow health care spending.

As students, we have already seen the system fail so many of our patients. We entered the health care profession in order to help people live their lives to their fullest potential. The current system won’t allow us to do that. We demand better. We demand a system that provides care based on needs and not means. We demand a system that considers health a human right.

Please join health professional students from four universities at a candlelight vigil on Thursday, Oct. 1, at 5:15 p.m., at Heritage Green Park, 610 W. Adams, Chicago, to show your support in our fight.

Jordan Centers is a nursing student at Rush University in Chicago and a member of Students for a National Health Program.

FEHBP premium increases indicate that we have not controlled health care costs

Federal health-care plan costs to rise by most in five years

By Eric Yoder
The Washington Post, September 29, 2015

The enrollee share of premiums in the health insurance program for federal employees and retirees will rise by 7.4 percent on average in 2016, the largest increase since 2011, the government announced Tuesday.

Overall premium increases in the Federal Employees Health Benefits Program will average 6.4 percent, but because of the way the formula works for setting the employer and enrollee shares, the enrollee share on average is increasing by more.

The increases in enrollee premiums break down to an average of 6.5 percent for self-only coverage and 10.7 percent for self and family coverage. Current family plan enrollees who switch to self plus one will see their premiums rise by 4.9 percent on average, rather than the 10.7 percent increase for sticking with family coverage.

Within the averages, there is much variation among plans, with some even reducing their premiums while others are increasing them by well more than the average. There are about 250 participating plans, the large majority available only regionally. In the Washington, D.C., metropolitan area, there will be 33 choices.

Office of Personnel Management officials said the increases are in line with estimates of upcoming hikes in private-sector employer-sponsored health plans, which are in the 4 to 6 percent range. Increases in another large governmental plan to which the FEHBP is often compared, the one covering California state employees, will range from 7 to 11 percent depending on the coverage chosen.

Organizations representing federal employees and retirees decried the increases, pointing out that federal employees are in line for only a 1.3 percent raise in January on average, and that retirees likely will receive no cost of living adjustment, or only a minimal one, due to the overall low rate of inflation.

Rising health-care costs “could even mean reduced take-home pay for some federal employees,” while retirees “are facing an even worse situation,” National Active and Retired Federal Employees Association President Richard G. Thissen said in a statement.

http://www.washingtonpost.com/blogs/federal-eye/wp/2015/09/29/federal-health-care-plan-costs-to-rise-by-most-in-five-years/

***

Comment:

By Don McCanne, MD

The Federal Employees Health Benefits Program (FEHBP) is the epitome of the golden standard of employer-sponsored health insurance – the type of coverage that the Affordable Care Act was designed to protect. The claim that we have controlled health care costs is belied by the fact that FEHBP premiums are increasing by an average of 6.5 percent for individual coverage and 10.7 percent for families, when wage increases are relatively flat – only a 1.3 percent increase for next year.

Premium increases in CalPERS – a similar program for California state employees – will range from 7 to 11 percent, a large increase considering that a return to a robust economy does not seem imminent.

This is the best we have, and it is not working well enough. A major factor is that FEHBP and CalPERS use competing private insurers. We have more than ample evidence to show that, not only have the private insurers been ineffective in slowing cost increases to sustainable levels, they have also perpetuated and expanded the profound administrative waste characterizing our system, both through their own administrative excesses and through the tremendous administrative burden they place on the health care delivery system.

Yesterday’s message was on a new OECD report on fiscal sustainability of health systems of economically-developed nations. What these nations have in common that is working for them is a collaboration between government health and budget officials. The most effective models for the United States would be either a single payer national health insurance program or a government-owned and operated national health service.

Since most Americans are comfortable with and supportive of Medicare, the more pragmatic and politically feasible approach would be to enact the single payer model of an improved Medicare for all. Of course, we could certainly enact a national health service if people were to become well informed on the models and decided that’s what they wanted instead.

Single-Payer System: Why It Would Save US Healthcare

Why America Should Have a Single-Payer System

By Leigh Page
Medscape, Sept. 29, 2015

Donald Berwick, MD, helped launch the Affordable Care Act (ACA)—considered at the time to be the only health reform this country would need—when he was administrator of the Centers for Medicare & Medicaid Services (CMS) in 2010 to 2011.

But 5 years later, Dr Berwick and millions of other Americans are calling for a new round of reform that would involve much deeper changes: a single-payer system. Dr Berwick says he still supports the ACA—”It’s been a step forward for the country,” he says—but adds, “The ACA does not deal with problem of waste and complexity in the system.”

Other single-payer advocates are less forgiving. They think that the ACA has pampered the commercial insurance industry, providing it with millions more customers and allowing it to jack up charges to levels that fewer Americans can afford.

The single payer would be the US government.

Single-payer reform would take an audacious step. It would virtually eliminate the entire commercial insurance industry—with $730 billion in revenues and a work force of 470,000—and replace it with one unified payer. A small vestige of the industry would remain to cover nonessential services, such as LASIK surgery.

Advocates often envision a single-payer system as an expansion of Medicare, or “Medicare for all.” Single-payer systems in Canada, Australia, Denmark, Norway, and Sweden—as well as other types of centrally run systems—have much lower per capita health spending and generally better health outcomes than the United States.[1] However, this is also true for non–single-payer systems outside of the United States. The United States simply has the highest healthcare costs, regardless of the system.

The single-payer approach has a moral argument—that everyone should have a right to healthcare—but it also has a practical argument, says James Burdick, MD, a transplant surgeon at Johns Hopkins University School of Medicine and author of Talking About SINGLE PAYER!, which will be published later this year. “It’s a more economical way to use healthcare resources,” Dr Burdick says. “You could reduce expenses and still improve quality. That’s a tremendous opportunity that you don’t have in many other fields.”

According to a 2014 study,[2] the new, streamlined system would save US healthcare $375 billion per year, owing mainly to removal of the inefficient administrative costs of multiple payers. The authors calculated that the savings would cover millions of people who are still uninsured and terminate high deductibles and other out-of-pocket costs levied by commercial insurers.

Restoring Doctors’ Authority

Terrence McAllister, a pediatrician with a solo practice in Plymouth, Massachusetts, thinks that a single-payer system would restore the medical profession’s independence and authority. Dealing with multiple commercial insurers makes it very difficult to be independent. “The profession is becoming more and more dependent on employment, and that usually means serving the needs of hospitals,” he says.

Dr McAllister’s wife, Leann, who administers the practice, sees a renaissance for small practices under a single-payer system. In the United States, small practices often have to make do with lower reimbursements because they lack negotiating leverage with insurers. There are no such negotiations in a single-payer system. “I could build a business plan with far more certainty,” she says.

For all practices, administrative costs would plummet because there would be only one set of payment rules. Prior authorizations, narrow networks, and out-of-pocket payments would be eliminated, proponents of a single-payer system say.

Under the Canadian single-payer system, physicians turn in a slip of paper for each encounter. Dr Burdick says that a Canadian orthopedic surgeon who moved from the United States told him he was greatly relieved to no longer have an extra room in the back for coding clerks and claims files. “I fill out the chits for each encounter, and my secretary bundles them up and sends them in,” he told Dr Burdick. Indeed, a 2011 study[3] found that US doctors spend almost four times more money dealing with payers than do doctors in Ontario, Canada.

Dr Berwick did not support a single-payer system until late 2013—several months into his campaign to be the Democratic nominee for governor of Massachusetts, his first foray into electoral politics. While campaigning, “I became more and more familiar with all the obstacles people faced in education, housing, and employment,” he says. “I concluded that our healthcare system takes money away from these things.”

He thinks a single-payer approach could clean up a highly inefficient system. “There is too much complexity and administrative hassle in our healthcare system,” he says. “We need to simplify the payment structure.”

Evidence of Growing Physician Support

Dr Berwick lost the primary in September 2014, but during the campaign, he saw his single-payer message resonate with doctors. It definitely did so with the McAllisters. “He helped solidify our support for a single-payer system,” Leann McAllister recalls. In March, Dr McAllister joined Physicians for a National Health Program (PNHP), a single-payer advocacy group that has more than 19,000 members nationwide.

Are more doctors flocking to support a single-payer approach? The only known recent poll of doctors is a 2014 survey of Maine physicians[4] conducted for the Maine Medical Association (MMA). The poll found that nearly 65% of MMA members preferred the single-payer option over trying to fix the current system—up from 52% in a 2008 survey.

The MMA 2014 survey showed that a single-payer system is especially popular among primary care and employed physicians. For example, more than three quarters of family physicians endorsed a single-payer system, compared with one third of radiologists. And whereas only 40.7% of physicians at fully physician-owned practices endorsed single-payer, 72.6% of those in fully hospital-operated practices did so.

Physicians seem more open to a single-payer system as the profession moves toward the Democrat Party, a stronghold of support for this idea. According to a study[5] published in July, 55% of doctors making political contributions in the 2013-2014 election cycle gave to Democrats. That’s a substantial change from 18 years earlier, when 72% of contributing doctors gave to Republicans.

Proponents say there are plenty of reasons for doctors to like the single-payer approach. In addition to restoring physicians’ authority and simplifying claims, Dr McAllister says that a single-payer system would simplify the clinical process, thereby boosting the quality of care. “From a clinical perspective, the main advantage is that I don’t have to consider which insurance the patient has and make my plans for patients on the basis of that,” he says.

It is also being claimed that a single-payer system may reduce malpractice litigation. There might not be a need to file a lawsuit to get future medical care, because a single payer would cover it. Still, it would not cover pain and suffering or economic damage.

Americans Are Warming Up to Single-Payer

There are signs that the public is also warming up to a single-payer system. A slight majority of Americans (51%) support Medicare for all, according to a national poll[7] released in January for the Progressive Change Institute. The survey also found, however, that more than one third oppose Medicare for all. Also, there is a wide partisan divide. Whereas 79% of Democrats supported a single-payer system, only 23% of Republicans did so.

Interest in single-payer may continue to grow, owing to the rise of high deductibles and other out-of-pocket costs for patients, according to Steffie Woolhandler, MD, a Harvard internist and cofounder of the PNHP. Although the ACA expanded coverage to millions more Americans, she says it also accelerated the trend toward high deductibles. “Now people with insurance are finding that they can’t afford to use it,” she says. (The assumption is that a single-payer system will not include high deductibles.)

A study[8] released by the Commonwealth Fund in May found that the proportion of US adults with high deductibles tripled from 2003 to 2014. It estimated that almost one quarter of insured US adults had such high out-of-pocket costs relative to their incomes that they were deemed to be underinsured. One half of this population reported problems with medical bills or debt, and more than 2 of 5 said that they didn’t seek needed care because of the cost.

“The trend in this nation is to shift the costs of healthcare more and more onto individual families,” Dr Berwick says. “High deductibles take money out of people’s pockets under the guise of personal responsibility. There is a great shift of wealth away from the middle class and working people.”

Dr Woolhandler says it may take years for many Americans with high deductibles to understand just how toxic they are. “People might need to have a major medical event to see how badly the system is failing them,” she says.

Leann McAllister makes an analogy to parents who deny pediatric vaccines until they understand that their own child could die without them. “Americans are often motivated by fear,” she says. “They may react only when they see that our healthcare system could fall apart.”

The Massachusetts practice administrator also says that high deductibles produce an imbalance in physician supply. In less wealthy areas, such as Plymouth, she says, patients faced with large out-of-pocket expenses simply forgo care, permanently reducing demand for doctors. She says no new physicians have come into the area for many years, despite a growing population.

Movement May Start on the State Level

The movement encountered a setback last December 2014, when Vermont pulled the plug on its single-payer initiative, the only one in the nation. The Vermont governor cited high projected costs for businesses and taxpayers, which cooled Vermonters’ enthusiasm and almost lost him his reelection bid the month before.

Dr Berwick says it’s only a temporary setback. “What happened in Vermont gives us lessons for the next wave of efforts,” he says. Advocates within the state are already working on new approaches. Deborah Richter, MD, a family physician in Berlin, Vermont, and a leader of the state’s single-payer movement, says she is working with legislators on a plan to publicly fund primary care activities only, and fold in specialists later. “We realize that you can’t just flip the switch and suddenly have a single-payer system,” she says.

The Vermont setback shows that people need to gain a better understanding of how a single-payer system would work, Dr Berwick adds. Although taxes and fees would rise substantially to pay for the system, these costs are less than what people had to pay for their own insurance. Businesses that already cover their employees would also see lower costs owing to efficiencies.

Dr Berwick thinks it’s possible that single-payer systems will initially emerge at the state level. “The current polarization in Washington makes it difficult to enact it on the federal level right now,” he says. Dr Richter likes the idea of state-operated systems within a national system, similar to the way in which Canada’s single-payer system is run by each province. The federal government would determine what services are covered, and each state would determine reimbursement levels.

Dr McAllister, however, doubts that a one-state single-payer system would work well. He recalls that when Massachusetts instituted its own pre-ACA version of health reform, out-of-state patients flocked to emergency departments there, driving up the program’s costs.

Public Distrust Must Still Be Overcome

One potential barrier for the movement is the public’s abiding mistrust of government. “A very big obstacle to progressing this policy is the widespread perception that government is unable to solve problems,” Dr Berwick told a national meeting of the PHNP last November.[9] “We need to make the case that government can solve problems and manage its business well.”

Dr Berwick and others in the movement see government as a mechanism for doing good. “Trying to make government look less functional, that’s the agenda on the right,” he says. But if anti-government attitudes prove insurmountable, he thinks that a single-payer operation could be handed over to an independent board.

Leann McAllister said that another unfair criticism of single-payer is that it would be bureaucratic. “We have an even bigger bureaucracy with commercial insurers,” she says. “They have plenty of unnecessary rules.” For instance, when patients in her practice move to a different plan, they sometimes are assigned a new doctor, even though her husband is in-network. “It takes a lot of paperwork to correct that,” she says.

Another potential downside that is cited for a single-payer system is waiting lists for elective procedures, such as those for hip and knee operations in Canada. The problem exists, but it’s “way overstated,” Dr Berwick says. “The fact is that Canadians wouldn’t trade their system for ours.”

Dr Burdick asserts that comparisons between US and Canadian waiting lists are unfair, because Canada scrupulously measures its waits and we don’t. “We know the numbers of Canadians on waiting lists because they are counted, but no one keeps track of how long you have to wait for care in the United States,” he says.

Dr Richter also discounts critics’ tales of a vast movement of Canadians to the United States to receive care denied back home. Most Canadians who get care in the States, she asserts, fell ill or had accidents while visiting.

What Would It Be Like for Doctors?

It’s hard to predict exactly how a single-payer system would affect US doctors, because it could be implemented in a variety of different ways. For example, Canadian doctors get fee-for-service payments, but Dr Berwick says US doctors could instead receive value-based payments, which Medicare is moving toward.

“There is really a wide range of choices,” says the former CMS administrator, who helped develop value-based payments for Medicare. “A global payment or capitated payment system could be quite flexible. This would allow funds to be easily shifted to where they’re most needed.”

Many specialists are concerned that their reimbursements would be slashed under a single-payer system, but Dr Burdick says that this doesn’t have to happen. “The spending problem in US healthcare does not really have to do with physician reimbursements,” he says. “It has to do with the payments that physicians are generating.”

Dr Burdick added that services covered by a single-payer system could be determined by a board of experts, like the United Kingdom’s National Institute for Health and Care Excellence (NICE). He wants the US board to be dominated by physicians—as NICE is—but it should also be completely independent of political influence, which he says NICE is not.

Dr Berwick agrees that physicians should have a central role on policy-making committees. “Doctors would have a voice in the terms of their work, and rules for paying them would have to be maintained in a fair way,” he says. “Right now, nobody knows how fees are set, and most doctors don’t at all feel that they’re in the driver’s seat.”

Dr Berwick is also a strong proponent of use of outcomes and quality data, as well as use of electronic medical records (EMRs). “Data would be an integral part of a single-payer system,” he says. “This is already going on with commercial payers, and they are using data in ways that are not accountable or transparent. You need rules so that the data aren’t misused and there are privacy protections.”

Under a single-payer system, EMRs would be simpler to use and there would be fewer data-reporting requirements, Dr Berwick says. “Right now, doctors are driven crazy by multiple reporting and payment structures,” he says. “It’s very complicated and highly demoralizing. A single-payer system would be a lot simpler.”

Conclusion

Dr Woolhandler says more work is needed before the United States embraces a single-payer system. “We have to get the word out about problems in the current system, and the ability of a single-payer system to resolve them,” she says. “And we need good political leadership that can explain the advantages. Political challenges in Washington make it very challenging to adopt a single-payer system right now, but the situation could change rapidly. Look at the late 1950s. Who could have predicted all the reforms that happened the 1960s?”

Leigh Page is a freelance health care writer in Chicago.

http://www.medscape.com/viewarticle/851265

OECD: Fiscal sustainability of health systems

Fiscal Sustainability of Health Systems: Bridging Health and Finance Perspectives

OECD, September 2015

From the Forward

This book provides a synthesis of the work developed by the OECD Senior Budget and Health Officials Joint Network. Over the past four years, this joint network has been an important forum to promote the dialogue and mutual comprehension between Health and Finance Ministries. It has provided a platform for budget and health officials to discuss together possible solutions to fiscal sustainability challenges in health care. It describes a wide range of responses by countries to the crisis – some clearly beneficial, achieving better value for money, others less so, reducing services across-the-board and potentially leading to poorer health outcomes and financial hardship from increasing costs borne by patients. This book presents a strong case for timely reforms of health care systems, based on close collaboration between budget and health officials.

From Chapter 1: Fiscal sustainability of health systems – Why is it an issue, what can be done?

The main messages from this chapter are summarised below:

  • Fiscal sustainability requires governments to mange public finances credibly. Health systems are a key challenge to fiscal sustainability, since rising costs, new treatment possibilities and demand for continued improvements to the quality of care will exert pressure on public finances.
  • Health expenditure has typically outpaced economies growth. Whilst the global economic crisis moderated rapid growth in health spending, this is expected to be temporary. Indeed, projections forecast health expenditures to rise as a share of GDP.
  • Spending on health has been largely driven by new technologies and rising incomes, with demographic change and institutional characteristics of health systems relevant but less important factors in most countries.
  • The implications of rising costs are particularly important for public finances, since health care is predominantly funded from public sources. Moreover, aging may lead to shortfalls in payroll taxes to finance health.
  • Policy makers have three broad ways to ensure fiscal sustainability of health systems: raise more money for health, improve the efficiency of government health spending, and reassess the boundaries between public and private spending. Simpler blanket spending cuts can also evidently address fiscal constraints, but are more likely to have adverse effects.
  • Health care is highly valued by populations and is a major contributor to countries’ economies. Therefore spending more on health care is not automatically a problem, particularly if citizens are willing to pay for this through higher taxes or cuts in other areas of government spending. The challenge is to ensure any increase in spending respects fiscal sustainability constraints, and delivers good value for money.

Do not reduce population coverage, avoid across-the-board increases in cost sharing

Looking first at population coverage, leaving certain population groups to be voluntarily covered by private health insurance appears to be a logical policy option from a fiscal perspective. Indeed, the theoretical advantages of private health insurance are an expansion of individual choice, greater innovation and flexibility, as well as reduced public cost pressures. However, in practice the risks associated with private health insurance are numerous, including higher administrative costs, less bargaining power for insurers, pressure for tax incentives, and risk selection leading to inequitable coverage gaps.

Given these issues, and coupled with strong social justice arguments, universality of population coverage should be maintained. In terms of cost coverage, blanket increases in cost-sharing and other forms of out-of-pocket payments is also undesirable, since they can deter health-seeking behaviour and can lead to people facing financial hardship. Small, targeted co-payments that include exemptions could be considered, but are unlikely to generate substantial revenues.

From the Conclusion of Chapter 1

Finally, it is also important to remember that more health spending is not automatically a problem. Good health remains a critical part of human development and an important contributor to economic growth. Health care is also highly valued by society. Accommodating greater health spending as a share of government budgets is therefore not automatically a problem. The challenge is to ensure that any increase in spending respects fiscal sustainability constraints, and that money is effectively spent.

From Chapter 2: The challenge of budgeting for health care programmes

Meanings of “sustainability”

The United States currently spends a share of its GDP on health care which would seem unthinkable and horrifying to policy makers in any other country. It seems unnecessary and wasteful to many Americans. Yet the US economy certainly has survived that level of spending. If the United States can survive its much higher spending, why would that level be “unsustainable” for other countries?

The most plausible way in which spending could be “unsustainable” would be if political support for the expense could not be sustained. Fundamentally, this means political support for redistribution. In all modern economies, the average cost of medical care is now unaffordable for a significant proportion of the population. All health care finance systems accordingly redistribute not just from the healthy to the sick, but from those with higher incomes to those with lower incomes. Systems are funded roughly in proportion to ability to pay; if they are not, then some people are likely to receive much less care. Therefore the capacity to spend on health care for all citizens depends on the ability to collect the necessary funds from the higher income strata within the country.

As the United States is an extreme case that suggests doubts about economic unsustainability arguments, it provides the clearest evidence of the political sustainability problem. The United States faces the most extreme redistribution challenge both because spending is so high, making costs less affordable for individuals, and because incomes are especially unequal, making average costs even more daunting for the lower-income groups. In the United States, limits on redistribution work not to make national health insurance unsustainable, but to prevent its creation.

http://www.oecd-ilibrary.org/social-issues-migration-health/fiscal-sustainability-of-health-systems_9789264233386-en

***

Comment:

By Don McCanne, MD

Because of ever-increasing health care costs, all nations are concerned about the fiscal sustainability of their health care systems. The United States has the highest costs – theoretically the least sustainable system – thus this report should be useful for our policymakers since it describes various approaches to sustainability by economically-developed member nations of OECD, informing us on both beneficial and detrimental policies.

This 264 page report is accessible, without charge, for reading – in sections or in its entirety – at the link above. Be sure to keep the link for future review or reference.

A major theme throughout this report is that sustainability is achieved by close cooperation between Ministries of Health and Ministries of Finance, that is, collaboration between government health and budget officials. In one word: government.

Because of our high health care costs and our inordinate levels of income inequality, we have a greater need for redistribution, yet, compared to other economically-developed nations, our government policies are relatively weak. As this report states, in the United States, “limits on redistribution work not to make national health insurance unsustainable, but to prevent its creation.”

U.S. policies hinder good health care for all

By Anne Scheetz, M.D.
The State Journal-Register (Springfield, Ill.), Sept. 27, 2015

During September we observe Sickle Cell Disease Awareness Month with the goal of bringing greater attention to this genetic disease that affects 4,000 to 5,000 Illinoisans. 

A disease of red blood cells, SCD can affect many body organs, including brain, bones, heart and lungs. Some people have few symptoms; others suffer serious complications such as childhood strokes, pneumonia, episodes of severe pain (pain crises), leg ulcers and early death. Under the best conditions SCD causes great suffering to severely affected people. With inadequate care, suffering is much worse.

Medical advances, including medications, blood transfusions and treatment of stroke risk, have improved symptoms, reduced organ damage and prolonged life for many people. All can have adverse effects. Stem cell transplants appear to cure select cases but carry a risk of death. 

Known ancestry does not reliably indicate risk, so all infants should be screened. But most patients are black. Being black and being sick are risk factors for poverty; personal poverty and living in poor neighborhoods in turn adversely affect health.

People with severe forms of the disease require a lot of care. But current U.S. policy systematically erects barriers to care. 

Doctors are supposed to keep patients healthy, and failure to do so is considered a sign of poor practice. Yet SCD is rarely curable, and many complications, including pain crises, are not preventable. Patients who suffer pain crises require frequent hospitalizations. Yet Medicare and Illinois Medicaid penalize hospitals for re-admissions. 

Despite increases in insurance coverage under the Affordable Care Act, people with SCD can find themselves uninsured. They can end up in high-deductible health plans. They may fail to get care or suffer financial hardship, and the stress of such pressures further worsens their health. 

Pre-authorization requirements make it difficult for patients to get wound care products and medications on time. Network restrictions prevent people from getting care from their doctors and hospitals of choice. Restriction to a single pharmacy, required under some health plans, prevents people from going elsewhere for out-of-stock pain medicines. Some essential services, such as dental care, which is important for good nutrition, are not covered for most people with SCD as for most Americans. 

U.S. health insurance plans are highly variable, and even the best do not cover all necessary care or provide first-dollar coverage. Insurance companies make their own determinations that certain treatments are experimental or not medically indicated, and drugs commonly used for chronic conditions may require high co-pays. 

In summary, people with SCD, like people living with other chronic diseases, suffer unnecessarily from policies that prevent good care. It doesn’t have to be this way. Lack of health insurance, unaffordable out-of-pocket costs, network restrictions, preauthorization requirements and penalties for readmissions all stem from our private-insurance-based system. 

Under a Medicare-for-all system every U.S. resident would have first-dollar coverage for all necessary care. Patients and their clinicians would make medical decisions. Everyone would have complete choice of hospitals, pharmacies and other providers. Financing by a progressive tax would transfer wealth from the top down, with the greatest benefit going to those currently most disadvantaged, including poor people, people of color and all sick people.

Instead of creating barriers to care, we would greatly simplify administration, saving $400 billion per year — more than enough to cover the uninsured and eliminate deductibles and co-payments for all of us. What better way to observe SCD Awareness Month than by pressing for a system that would allow us to provide the best care to people affected by this disease? 

Dr. Anne Scheetz is a founding member of the Illinois Single-Payer Coalition and a leader of the Illinois chapter of Physicians for a National Health Program. She lives in Chicago.

http://www.sj-r.com/article/20150927/OPINION/150929656