PNHP

Nobody Should Get Rich Off Obamacare

Nobody Should Get Rich Off Obamacare

By Evan Soltas
Bloomberg, The Ticker, Dec. 3, 2013

For an industry that’s supposed to be burdened by the launch of Obamacare, the health-care business is doing pretty well. Stocks of health-care companies are up almost 40 percent this year, the strongest performance of any sector in the S&P 500.

This is despite, for insurers, new regulations on the “medical loss ratio” which require them to spend at least 80 percent of premiums on health care — in practice, capping their profits and administrative expenses such as advertising at 20 percent. How about the medical-technology manufacturers that were slapped with an excise tax? Doing just fine. The hospital chains that face lower reimbursement rates from Medicare patients? They’re doing well, too.

Health care is a business, and businesses are supposed to make money. Still, it’s a bit concerning that health-care investors are so upbeat just as President Barack Obama’s health-reform law goes into effect.

It makes you wonder where the new profits are expected to come from. If they’re earned in a competitive market, great — but health care in the U.S. hasn’t been a free market in decades, so it’s worth turning a skeptical eye.

The law will give the insurance industry millions of new customers and subsidizes its products. It brings millions of others into the market for health-care services through its Medicaid expansion. If health-care investors are throwing a party, it might be because the rest of us are paying for it.

Economists call profits in excess of what would be earned in a competitive market “rents.” Often it’s hard to tell the difference — but the expected increase in health-care profits has a whiff of rent about it. After all, Obama passed his law with the support of the health-care industry. The insurers signed on. Pharma signed on. Doctors signed on. It would be shocking if this law reduced their rents.

Regulation is the usual remedy. Public utilities commissions, for example, determine the “fair profit” of electric utilities and prevent them from squeezing customers. In health care, this hasn’t been the Obama administration’s approach. A headline on a recent piece by Adam Davidson put it best: “The President Wants You To Get Rich On Obamacare.” It said that Tom Scully, a private-equity executive who has been pitching health-care investments, leaves investors expecting a gold mine:

No matter what investors thought about Obamacare politically — and surely many there did not think much of it — the law was going to make some people very rich. … With the right understanding of the industry, private-sector markets and bureaucratic rules, savvy investors could help underwrite innovative companies specifically designed to profit from the law. Billions could flow from Washington to Wall Street, indeed.

The health-care reform gives health-care suppliers one of the benefits enjoyed by utilities: safe profits. But the quid pro quo — that those profits should be moderate — seems to be missing. That’s the assessment of investors, anyway. For now, at least, they aren’t looking at Aetna the way they look at Con Ed.

Evan Soltas is a contributor to the Ticker.

http://www.bloomberg.com/news/2013-12-03/nobody-should-get-rich-off-obamacare.html?alcmpid=view

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Who wins under Obamacare?

Nobody Should Get Rich Off Obamacare

By Evan Soltas
Bloomberg View, December 3, 2013 For an industry that’s supposed to be burdened by the launch of Obamacare, the health-care business is doing pretty well. Stocks of health-care companies are up almost 40 percent this year, the strongest performance of any sector in the S&P 500. How about the medical-technology manufacturers that were slapped with an excise tax? Doing just fine. The hospital chains that face lower reimbursement rates from Medicare patients? They’re doing well, too. Health care is a business, and businesses are supposed to make money. Still, it’s a bit concerning that health-care investors are so upbeat just as President Barack Obama’s health-reform law goes into effect. The law will give the insurance industry millions of new customers and subsidizes its products. It brings millions of others into the market for health-care services through its Medicaid expansion. If health-care investors are throwing a party, it might be because the rest of us are paying for it. http://www.bloomberg.com/news/2013-12-03/nobody-should-get-rich-off-obamacare.html?alcmpid=view

Comment:

By Don McCanne, M.D. To pass the Affordable Care Act, President Obama was convinced that he had to gain the support of the health financing and health care industries. He did. Look who’s profiting. Who loses? Those who will have to pay much more out of pocket for health care because of higher deductibles. Those who lose choice of their physicians and hospitals because of narrower provider networks, and end up losing catastrophic protection because of care inadvertently received out of network. Those who will be contributing through taxes or insurance premiums far more than they should have to because of the profoundly wasteful administrative excesses of our dysfunctional financing system. That’s most of us. The improvements in insurance plans for the few – guaranteed issue and community rating – do not begin to offset the deterioration that is beginning to take place in the employer-sponsored plans where most of us receive our health care coverage. There are a few of us who will gain, some by being enrolled in Medicaid and some by receiving subsidies for exchange plans, but the numbers of us who will lose is far greater than the numbers who will win. We could have had reform in which we would all be winners – an improved Medicare that covers everyone. Even those who will gain through Medicaid or subsidies would gain much more under a single payer system. But no, political feasibility dictated that the vested stakeholders of the medical-industrial complex be the ones who get the money, while the rest of us pay more and get less.

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Medicare for all is the solution

By Andrew Rock
Tampa Bay Times, Letters, Nov. 3, 2013

Re “New dispute arises: policy cancellations” (Oct. 30)

All the recent hoopla about the Affordable Care Act has generated a lot of heat but not much light. In all the angry finger-pointing, both parties have missed the main point. Obamacare is flawed and cumbersome for the same reason that our existing “system” doesn’t work: It is a health insurance system, not a health care system. The obvious answer is a single-payer health care system, Medicare for all

The administration is running into problems with technology and with cancellation of existing policies precisely because Obamacare is an insurance-based program. So we have to navigate insurance exchange websites, that must then connect up with insurance company databases, that must then correlate with existing insurance coverage, and so on. It’s bound to be inefficient and confusing, and also costly.

Insurance companies take at least 20 cents out of every dollar Americans spend on health care; Medicare takes only 2 or 3 cents on the dollar. Health insurance companies are massively profitable, yet most Americans either can’t afford health insurance or are very dissatisfied with the coverage they have, which is not only expensive but often not there for us when we need it most.

Those Americans fortunate enough to be on Medicare are very happy with it. Most of us, including President Barack Obama, knew that a single-payer Medicare for all system was by far the best way to reform American health care. But it didn’t happen because it wasn’t “politically doable.” Most of our congressmen and state legislators are more responsive to the corporate interests who pay for their election campaigns than the people they claim to represent. This is true of both Republicans and Democrats. So single payer was never on the table because the health insurance lobby is simply too powerful.

If Obamacare ever gets off the ground, it will be helpful to many low-income Americans who will be able to afford health insurance. But it is a huge windfall for the health insurance industry, just as the Bush administration’s prescription drug benefit was a huge windfall for the pharmaceutical industry.

Andrew Rock lives in Tampa.

http://www.tampabay.com/opinion/letters/vote-for-november-letter-of-the-month/2155085

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Bone Marrow as a commodity

Why It’s OK to Pay Bone-Marrow Donors

By Sally Satel
Bloomberg View, December 1, 2013 Locating a marrow donor is often a needle-in-a-haystack affair. The odds that two random individuals will have the same tissue type are less than 1 in 10,000, and the chances are much lower for blacks. Allowing compensation for donations could enlarge the pool of potential donors and increase the likelihood that compatible donors will follow through. So the ruling by a three-judge panel of the U.S. Court of Appeals for the Ninth Circuit was promising news for the 12,000 people with cancer and blood diseases currently looking for a marrow donor. Shaka Mitchell, a lawyer in Nashville, Tennessee, and co-founder of the nonprofit MoreMarrowDonors.org… invited a team of economists to evaluate the effects of the ruling on people’s willingness to join a registry and to donate when they are found to be a match. The researchers were to specifically assess whether cash payments would be any more or less persuasive than noncash rewards or charitable donations. Now comes the bad news. On Oct. 2, the U.S. Department of Health and Human Services proposed a new rule that would overturn the Ninth Circuit’s decision. The government proposes designating a specific form of bone marrow — circulating bone-marrow stem cells derived from blood — as a kind of donation that, under the 1984 National Organ Transplant Act, cannot be compensated. The strongest opposition to compensation comes from the National Marrow Donor Program, the Minneapolis-based nonprofit that maintains the nation’s largest donor registry. Michael Boo, the program’s chief strategy officer, says of reimbursement, “Is that what we want people to be motivated by?” HHS is presumably under pressure from the National Marrow Donor Program. The department does not otherwise explain its proposed rule except to claim that compensation runs afoul of the transplant act’s “intent to ban commodification of human stem cells” and to “curb opportunities for coercion and exploitation, encourage altruistic donation and decrease the likelihood of disease transmission.” Each year, 2,000 to 3,000 Americans in need of marrow transplants die waiting for a match. Altruism is a virtue, but clearly it is not a dependable motive for marrow donation. (Sally Satel, is a psychiatrist and a resident scholar at the American Enterprise Institute.) http://www.bloomberg.com/news/2013-12-01/why-it-s-ok-to-pay-bone-marrow-donors.html

Comment:

By Don McCanne, M.D. Imagine trading bone marrow in the commodities market. It could be very lucrative. In no time at all, the prices could be driven over what we are now paying for the newer cancer drugs – $100,000 and more – maybe much more. And don’t stop at bone marrow. Think of the trade that could be generated in other human organs. Is there no end to the commodification of health care? How did we end up here? Is the compulsion to look for market solutions so great that we abandon all sense of humanity? People who think like this – do they have a soul?

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The real fix for Obamacare's flaws: Medicare for all

There’s no reason to rollback the progress the ACA has made. But we should go all the way and dump the for-profit system

By RoseAnn DeMoro
The Guardian (U.K.), Nov. 27, 2013

Lost amidst the well-chronicled travails of the Affordable Care Act rollout are the long term effects of people struggling to get the health coverage they need without going bankrupt.

If that sounds familiar, it’s because that’s been the main story line of the US healthcare system for several decades. Sadly, little has changed.

Still, with all the ACA’s highly publicized snafus, and less discussed systemic flaws, there’s no reason to welcome the cynical efforts to repeal or defund the law by politicians whose only alternative is more of the same callous, existing market-based healthcare system.

US nurses oppose the rollback and appreciate that several million Americans who are now uninsured may finally get coverage, principally through the expansion of Medicaid, or access to private insurance they’ve been denied because of their prior health status.

At the same time, nurses will never stop campaigning for a fundamental transformation to a more humane single-payer, expanded Medicare for all system not based on ability to pay and obeisance to the policy confines of insurance claims adjustors.

Website delays – the most unwelcome news for computer acolytes since the tech boom crashed – are not the biggest problem with the ACA, as will become increasingly apparent long after the signup headaches are a distant memory.

What prompted the ACA was a rapidly escalating healthcare nightmare, seen in 50 million uninsured, medical bills plunging millions into un-payable debt or bankruptcy, long delays in access to care, and record numbers skipping needed treatment due to cost.

The main culprit was our profit-focused system, with rising profiteering by a massive health care industry, and an increasing number of employers dropping coverage or just dumping more costs onto workers.

The ACA tackles some of the most egregious inequities: lack of access for many of the working poor who will now be eligible for Medicaid or subsidies to offset some of their costs for buying private insurance through the exchanges, a crackdown on several especially notorious insurance abuses, and encouragement of preventive care.

But the law actually further entrenches the insurance-based system through the requirement that uncovered individuals buy private insurance. It’s also chock full of loopholes.

Some consumers who have made it through the website labyrinth have found confusing choices among plans which vary widely in both premium and out of pocket costs even with the subsidies, a pass through of public funds to the private insurers.

The minimum benefits are also somewhat illusory. Insurance companies have decades of experience at gaming the system and warehouses full of experts to design ways to limit coverage options.

The ACA allows insurers to cherry pick healthier enrollees by the way benefit packages are designed, and as a Washington Post article noted on 21 November, consumers are discovering insurers are restricting their choice of doctors and excluding many top ranked hospitals from their approved “network”.

The wide disparity between the healthcare you need, what your policy will cover, and what the insurer will actually pay for remains.

Far less reported is what registered nurses increasingly see – financial incentives within the ACA for hospitals to prematurely push patients out of hospitals to cheaper, less regulated settings or back to their homes. It also encourages shifting more care delivery from nurses and doctors to robots and other technology that undermines individual patient care, and that may work no better than the dysfunctional ACA websites.

Is there an alternative? Most other developed nations have discovered it, a single-payer or national healthcare system.

Without the imperative of prioritizing profits over care, Medicare for all streamlines the administrative waste and complex insurance billing operations endemic to private insurance. That waste is a major reason why the US has more than double the per capita cost of healthcare of other developed nations, yet lower life expectancies than many.

Medicare for all eliminates the multi-tiered health plans that plague both the individual and group insurance markets that are tied to the girth of your wallet not your need for care. Class, gender, and racial disparities in access and quality of care vanish under Medicare for all.

It’s beyond time that we stop vilifying government and perpetuating a corporatized healthcare system that has abandoned so many. We can, with a system of Medicare for all, we can cut healthcare costs and promote a much more humane society.

http://www.theguardian.com/commentisfree/2013/nov/27/obamacare-flaws-medicare-for-all

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Grading a Physician's Value — The Misapplication of Performance Measurement

Grading a Physician’s Value — The Misapplication of Performance Measurement

By Robert A. Berenson, M.D., and Deborah R. Kaye, M.D.
The New England Journal of Medicine, November 28, 2013 Perhaps the only health policy issue on which Republicans and Democrats agree is the need to move from volume-based to value-based payment for health care providers. Rather than paying for activity, the aspirational goal is to pay for outcomes that take into account quality and costs. In keeping with this notion of paying for value rather than volume, the Affordable Care Act (ACA) created the “value-based payment modifier,” or “value modifier,” a pay-for-performance approach for physicians who actively participate in Medicare. By 2017, physicians will be rewarded or penalized on the basis of the relative calculated value of the care they provide to Medicare beneficiaries. Although we agree that value-based payment is appropriate as a concept, the practical reality is that the Centers for Medicare and Medicaid Services (CMS), despite heroic efforts, cannot accurately measure any physician’s overall value, now or in the foreseeable future. The value modifier is meant to provide differential payment to a physician or physician group under the Medicare Physician Fee Schedule on the basis of the quality of care furnished as compared with the cost. To reduce the burden on physicians, CMS has based the value modifier on the Physician Quality Reporting System (PQRS). The meager rate of physician participation in the PQRS suggests that something is fundamentally wrong — physicians simply do not respect the measures, and for good reason. PQRS measures reflect a vanishingly small part of professional activities in most clinical specialties. A handful of such measures can provide a highly misleading snapshot of any physician’s quality. Research shows that performance on specific aspects of care does not predict performance on other components of care. Primary care physicians manage 400 different conditions in a year, and 70 conditions account for 80% of their patient load. Yet a primary care physician currently reports on as few as three PQRS measures. The challenge of accurately assigning costs to an individual physician is similarly daunting. Current methods for case-mix adjustment do not adequately capture variations in patients’ illness severity, complicating coexisting conditions, or relevant socioeconomic differences — differences beyond the physician’s control that affect the cost of care. And we currently don’t know how to attribute to an individual physician the costs that Medicare beneficiaries generate across the health care system. Even if we had better measures, behavioral economists would still challenge the pay-for-performance concept, at least for professionals such as physicians and teachers, who must manage complex situations and creatively solve problems. These critics argue that rewarding professionals on the basis of a particular performance measure has the potential to crowd out the intrinsic motivation to perform well across the board, not just on the few activities being measured. http://www.nejm.org/doi/full/10.1056/NEJMp1312287?query=TOC

Comment:

By Don McCanne, M.D. The “value-based payment modifier” – an adjustment in payments to reward physicians for improving value in the health care they provide, or to punish them for providing lower value – is yet another example of the often misguided measures in the Affordable Care Act allegedly designed to improve our health care system, when, in fact, the fundamental reforms in the health care financing system that we really needed were barely touched upon, in deference to the private insurance industry. It will be difficult to change from a volume-based system (fees based on volume of services provided) to a value-based payment system when we still do not know how to define the value of physician services, as Drs. Berenson and Kaye explain to us in this NEJM article, though they do suggest some other modest measures that might have some benefit. It is fine to continue research on measures that have a potential for improving value in health care, but it is almost criminal to ignore a concept that has already been proven in other nations to dramatically increase value – potentially a far greater increase than all of the other measures combined that are included in the Affordable Care Act. Of course, that concept is single payer financing. Let’s first enact an improved Medicare for all, and then we could tweak the system with measures that might provide incremental improvements in value. But first things first.

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Major physician organizations concerned about impaired access through exchange plans

Doctors: New Health Care Plans Raise Red Flags

By Louise Radnofsky
The Wall Street Journal, November 26, 2013 Physicians groups told Obama administration officials Tuesday that they are worried that new insurance plans under the Affordable Care Act offer only limited networks of providers and low reimbursement rates for doctors, and that could make it difficult for millions of those enrolled to actually get health care. As the Journal has reported, some health plans don’t include big brand-name health providers in their networks and are slashing how much they’ll pay medical practices for treating the newly covered. Representatives from the major physician lobbying groups raised these issues Tuesday in a White House meeting with health officials including Chris Jennings and Jeanne Lambrew of the White House, and Chiquita Brooks-LaSure of the Centers for Medicare & Medicaid Services. “Some of the things were not a surprise to them… they’re acutely aware,” Shawn Martin, a top lobbyist for the American Academy of Family Physicians, said after the noon meeting. The American Medical Association, the American Academy of Family Physicians, American Academy of Pediatrics, and American College of Physicians, the American Osteopathic Association, the American Medical Group Association and the American Association of Nurse Practitioners were among the groups present, participants said. http://blogs.wsj.com/washwire/2013/11/26/doctors-new-health-care-plans-raise-red-flags/

Comment:

By Don McCanne, M.D. The new health plans to be offered in the exchanges are avoiding excessive premium increases by using narrow networks of physicians and by lowering payment rates for health services. The leaders of our nation’s leading organizations of health care professionals are concerned enough about what this might do to patient access that they met with Obama administration officials at the White House. The administration officials were already “acutely aware” of these problems. Of course, they were. They result from fundamental design flaws in the financing model of the Affordable Care Act. The model was designed by and for the private insurance industry. It is likely that members of these professional organizations are not only concerned about the patients, narrow networks and lower payments have a direct effect on their livelihoods. In a well designed system, patients must always come first, but the professionals taking care of the patients should be content as well. Grumpy doctors and nurses detract from an optimal patient care environment. There will be more discontentment as the Obamacare model of high-deductibles, narrow networks, and payment restrictions extend to employer-sponsored private plans. These trends will no doubt expand with the proliferation of private insurance exchanges catering to employers – exchanges outside of the government-operated Obamacare exchanges. Even the private Medicare Advantage plans are being modified in response to their overpayments being pared back. UnitedHealth, the nation’s largest private insurer, has notified thousands of physicians that they are being dropped from their Medicare Advantage network. Do we really want to keep headed in this direction? The traditional Medicare program does not use narrow networks. Patients have their choice of their health care professionals. Medicare payment rates are higher than the rates expected to be offered by most of the exchange plans. It would not take much to improve Medicare, and then it would be an ideal program for covering everyone. You can bet that the representatives of these professional groups didn’t ask for single payer to be put on the table. Too bad.

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Obama put faith in house of cards

By Eric Naumburg, M.D.
The Baltimore Sun, Letters, Nov. 26, 2013

President Obama is reaping what he sowed by relying on the health insurers when he supported the Affordable Care Act. The health insurers literally wrote the law, in the person of Liz Fowler, a former VP at WellPoint, and clearly they know Obamacare better than the President, whose ill-fated promise about keeping your health insurance if you are happy with it blew up in his face.

But the reality is the American people never wanted their favorite health insurance plan what they want is affordable, accessible healthcare. In fact a majority of Americans want a government funded healthcare system similar to traditional Medicare.

The complexity of the Affordable Care Act undoubtedly contributed to its difficult launch; but the real weakness of the law is that once you have health insurance you are still not protected from bankruptcy due to illness or guaranteed access to the doctor and hospital of your choice.

We need a humane healthcare system, not a profit-driven one. In a rich country like America, healthcare should be a public good, not a privilege. If we expanded traditional Medicare to everyone, there would be no need to figure out if you can afford a bronze, silver, gold or platinum plan; instead there’d be one standard of care for everyone.

Dr. Eric Naumburg is co-chair of the Maryland chapter of Physicians for a National Health Program.

http://www.baltimoresun.com/news/opinion/readersrespond/bs-ed-health-insurance-20131126,0,4649646.story

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The Single-Payer Alternative

By Nancy Folbre
The New York Times, Economix blog, Nov. 25, 2013

Rush Limbaugh’s take on the disastrous rollout of the Affordable Care Act could, ironically, warm the hearts of those at the other end of the political spectrum. He contends that President Obama knew all along that the Affordable Care Act would crash and burn, but pushed it through so that the conflagration would clear the way for single-payer health insurance.

The conspiracy charge sounds deranged, but problems with the new health insurance system may indeed revitalize demands for more substantive reforms, which many policy makers and voters set aside in the putative interests of political pragmatism. Whatever the advantages of a single-payer system such as that currently administered by Medicare, one view held, American voters were unlikely to get behind it.

Yet one of the greatest advantages of a single-payer system — its relatively low administrative costs — has been thrown into sharp relief by problems registering with the new health exchanges.  Andwhile Republicans despise the Affordable Care Act despite its conformity with many of their earlier proposals, their proposed changes (other than simple rollback) look complicated, kludgy and costly to administer.

The malfunctioning website has magnified problems inherent in coordinating enrollment across many different companies in many different exchanges in cooperation with many different government agencies. The harmonization challenges are orders of magnitude greater than those faced by a single company or a single state, making streamlining difficult. Improved software can do only so much.

In theory, competition and choice should increase efficiency. In practice, health insurance companies are able to take advantage of the complexity and uncertainty surrounding health care choices to make comparison shopping very difficult.

Lack of clear information about the prices of medical procedures, combined with a proliferation of insurance options whose potential benefits will be strongly affected by unpredictable events (such as being involved in an automobile accident or developing cancer), put consumers in a weak position.

The process of negotiating relationships with new health care providers because old ones are “out of network” is physically and emotionally exhausting. Insurance companies benefit from promoting policies that are difficult to understand and make consumers fearful of any change in their coverage. That fear and aversion has spilled over into the transactions required for many people to benefit from the Affordable Care Act.

David Himmelstein and Steffie Woolhandler, co-founders of Physicians for a National Health Program, regularly assert that elimination of the huge paperwork and overhead imposed by private insurance companies could save enough to cover the estimated 31 million of Americans who will remain uninsured under the Affordable Care Act.

My fellow Economix blogger Uwe E. Reinhardt, expanding on this theme, notes that the Institute of Medicine of the National Academy of Sciences recently estimated excess administrative costs of $191 billion, again more than enough to attain truly universal health care coverage.

Most such estimates are limited to the monetary costs incurred by insurers, doctors and hospitals and don’t include the value of the time that health care consumers must devote to managing a torrent of inscrutable paperwork that can become truly frightening for the critically ill.

Even if its rollout becomes more expeditious, the Affordable Care Act does little to reduce the incentives that companies have to barricade themselves behind high information and transaction costs. In the financial sector, I previously noted, this perverse incentive is described as “strategic price complexity.”

A complicated new program applied to a complicated old industry makes it hard for everyone to figure out exactly what they will be getting relative to what they are paying. As a result, many ordinary people and small businesses fall prey to redistributional paranoia.

Accusations of ripoffs proliferate, along with assertions that the Affordable Care Act is unfair to young people or that it simply represents transfers from the affluent to the poor, or from whites to people of color.

The program clearly has redistributive impact, but much of it will be muted over the life cycle. People who pay more for their insurance will get more benefits in return. The biggest transfers will go from the healthy to the sick (who are sometimes poor precisely because they are sick) and from one part of the health care system (emergency room care) to another (insurance-covered routine care).

But the structure of the program seems unintentionally designed to intensify distributional conflict. Its highly means-tested subsidies create strong political resentments and contribute to very high implicit marginal tax rates on lower-income families.

A single-payer insurance system, whether based on an extension of Medicare or on the Canadian model, promises many profoundly important benefits. Right off the mark, it promises simplicity.

No wonder conservative pundits are afraid of it.

Nancy Folbre is professor emerita of economics at the Universi ty of Massachusetts, Amherst. http://economix.blogs.nytimes.com/2013/11/25/the-single-payer-alternative/?_r=0

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Both parties protect health care industry

By James Fieseher, M.D.
Portsmouth (N.H.) Herald, Nov. 24, 2013 In the land where the Supreme Court recognizes corporations as “people,” political contributions are seen as a “right of free speech,” and multi-billion-dollar corporations are given taxpayer bailouts, it is little wonder that politicians are willing to shut down the government in an effort to support a bloated health care system that fails to cover more than 80 percent of Americans while charging us three times the cost of health care as in other industrialized nations. There has been a great deal of political noise, but no constructive discussion when it comes to health care. Our health care “debate” has been reduced to an attack or defense of the Affordable Care Act, or ACA (a.k.a. “Obamacare”). Indeed, the implementation of “Obamacare” has uncovered some glaring flaws. Not the least of which was the president promising people they could “keep their health care plan” while simultaneously setting a standard for insurance companies to protect patients from substandard care. That promise would have worked if substandard health insurance didn’t exist, but that was one of the reasons the ACA was passed in the first place. Because of this oversight, we have Republican partisans demanding that health care reform be repealed, a Democratic president trying to regain credibility for a remark that in retrospect, never should have been made and self-insured Americans (approximately 10 percent of the population) trying to decide whether they should hold on to a substandard health insurance policy. It is this last group that feels like they’re owners of a boat with a large hole in it. Their boat is fine as long as they don’t need to put it in the water. The ACA, promoted by Democrats, is faulty and complicated, but the Republicans’ insistence on “free market” health care is worse. “Free market” is the same health care that we’ve been working with for the past 40 years and is available only if you’re healthy and wealthy enough. Health care costs under a “free market” system are responsible for well over half of the personal bankruptcies in the Unites States each year. If you’re a conscionable small business owner, a minimal health care plan for your employees constitutes about 25 percent of your business expense. There is nothing “free” in that free market. The Republicans’ lack of a health care alternative makes the “party of business” more like the party only for big business. Both Republicans and Democrats are careful to protect the health care industry. The Democrats do try to rein in some of the more egregious abuses of the health insurance industry, but the problems and abuses are so widespread that the ACA makes for easy pickings for its critics. Is medical insurance too big to fail? Health insurance is one of the most profitable industries in the country, meaning we pay a lot into it and get much less out of it. Surely the reason that politicians from both sides of the aisle support the health insurance industry must go beyond fat political contributions. Medical insurance companies were not formed to promote health or health care; they are the one component of the health care industry that doesn’t actually contribute to patient care. If you are lucky enough to hit the health insurance “lottery” and receive more money than you (and your employer) contributed, then you can be sure someone in the company is looking for a way to drop you from your plan. To really fix health care, we need to look beyond the two “solutions” offered by the two major political parties that promote different ways of protecting our medical insurance industry. We need solutions that offer every American access to health care at a cost that neither bankrupts the individual nor the nation. That means a thoughtful, respectful discussion not manipulated by the fear mongers against big government or big business. Winston Churchill once said: “Healthy citizens are the greatest asset any country can have.” Our large corporations have received their bailouts, it’s time we took care of our “other” citizens — the mere mortal ones. James Fieseher, MD, FAAFP, practices in Portsmouth. http://www.seacoastonline.com/articles/20131124-OPINION-311240316

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Story omitted exchange on single payer

By David Ray, M.D.
Times Union (Albany, N.Y.), Nov. 25, 2013 I believe the article on Uwe Reinhardt’s lecture at the University at Albany had a glaring omission (“Website failure carries high risk,” Nov. 20). I attended this talk, and the first question posed to Mr. Reinhardt was “what about single-payer health care?” He responded by revealing that he consulted with the government of Taiwan when they chose to overhaul their system in 1995, and he facilitated their adoption of a single-payer system. Mr. Reinhardt went on to describe a simple system with universal access, seamless and transportable care, smart card access and other features that he characterized as “a dream system.” The United States health care stands 37th, Taiwan is ranked fifth. So what stands between the United States and such a sensible system? Political will is lacking and, frankly, that means that our legislators lack the backbone to stand up to the dollar power of the lobbyists and monied interests like the private insurance industry. Mr. Reinhardt suggested the only solution in this country is to move forward by individual states or communities. That works well in a place like Albany, which has few hospitals, benevolent insurance companies, and low unemployment. But what about the cities and states that have no inclination or means to care for the underserved and that rank low in population health? Is it: “Sorry, every man (or city, or state) for itself?” That doesn’t seem like any way to run a country. There are numerous single-payer advocacy groups active in the Capital Region. For the future of our children and our country, everyone should join one, learn the facts, and make himself or herself heard. David Ray, M.D., is Coordinator, Capital District Chapter, Physicians for a National Health Plan. He lives in Menands. http://www.timesunion.com/opinion/article/Everyone-has-a-health-care-voice-5008278.php PNHP note: This letter originally appeared under the headline “Everyone has a health care voice.”

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2013 OECD Indicators and the economic crisis

Health at a Glance 2013 – OECD Indicators

OECD, November 21, 2013

Editorial: From expenditure growth to productivity growth in the health sector

By Stefano Scarpetta, Director for Employment, Labour and Social Affairs Almost six years since the start of the global financial and economic crisis, economic conditions vary widely across OECD countries, with the United States, Canada and Japan on a path to recovery, while the economic prospects of many European countries remain subdued. After a period in which, as part of the stimulus packages, greater resources were channelled to welfare and social protection programmes, the shift towards restoring sound fiscal conditions has often implied substantial cuts in public spending. Like other government programmes, health care has been the target of spending cuts in many OECD countries. The crisis has had a profound impact on the lives of citizens across the world, and has tested the resilience of many families as they see their wealth and incomes decline. Millions of people have joined the ranks of the unemployed and millions more are experiencing financial stress. The combined effects of the crisis with the associated recent expenditure cuts as well as health care reforms have led to uncertainty about the impact on the health and well-being of the population. The most recent OECD health statistics, presented in this edition of Health at a Glance, provide a comprehensive picture of how health systems have evolved during the crisis and the challenges which lie ahead. Growth in health spending has slowed markedly in almost all OECD countries since 2008. After years of continuous growth of over 4% per annum, average health spending across the OECD grew at only 0.2% between 2009 and 2011. Total health spending fell in 11 out of the 34 OECD countries between 2009 and 2011, compared to pre-crisis levels. Not surprisingly, the countries hit hardest by the economic crisis have witnessed the biggest cuts in health expenditure growth. In order to limit or reduce public health expenditures, countries have worked to lower the prices paid for publicly financed health care, including cutting the price of medical goods, particularly pharmaceuticals. Governments have targeted hospital spending through budgetary restrictions and cuts to wages. Several countries including Greece, Ireland, Iceland and Estonia have reduced nursing wages in response to the crisis as well as those of salaried GPs. Expenditure on prevention and public health has also been cut since 2009. Further, in several OECD countries, patients are now expected to assume a greater share of health costs. There is evidence that more people in countries such as Greece and Italy are foregoing medical care due to financial constraints, reflecting reduced household incomes, but also perhaps rising out-of-pocket costs. Low-income groups are the worst affected, although they are likely to have the highest health care needs, and they may be foregoing necessary care such as medicines or routine medical check-ups for chronic conditions. This may have long-term health and economic consequences for the most vulnerable groups in society. Many of the reforms implemented since the start of the crisis have had an immediate impact on public expenditure. Some have been controversial, with considerable unrest and political pressure from industry groups, and some may also have had undesirable consequences for access, outcomes and equity. For example, greater out-of-pocket costs are likely to reduce health care use among those in highest need, leading to greater inequity and inefficiency over the longer term. In the new, more constrained, fiscal climate, the challenge for health care policy makers is to preserve quality health care coverage for the whole population while converting a system built on notions of unconstrained growth to one that is based on greater productivity and fiscal sustainability. This challenge is not new. Countries have pursued the twin objectives of efficiency and equity in health for decades. The economic crisis means that health care policy makers must swiftly and convincingly adopt a health care productivity agenda. Health at a Glance 2013 – OECD Indicators (213 pages): http://www.oecd.org/els/health-systems/Health-at-a-Glance-2013.pdf

Comment:

By Don McCanne, M.D The 2013 edition of OECD’s “Health at a Glance,” in text, graphs and tables, provides updates of international comparisons of indicators of health and health systems. The graphs are likely familiar to many of you. This report is worth downloading just to have the updates. The editorial discusses the stresses on health systems resulting from the Great Recession, and the government responses to those stresses. A trend that should alarm us all is that “patients are now expected to assume a greater share of health costs.” Further, more people are forgoing medical care due to financial constraints. There is concern that the responses may be having undesirable consequences for access, outcomes and equity. The editorialist emphasizes that nations should pursue the objectives of efficiency and equity by adopting a new health care productivity agenda. Improving productivity is fine, but for the United States, it is imperative that we immediately adopt a financing infrastructure that ensures equity. All other OECD nations are light years ahead of us on that.

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