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What is best health care coverage for part-time workers?

What is best health care coverage for part-time workers?

Wegmans cuts health benefits for part-time workers

By Samantha Maziarz Christmann
The Buffalo News, July 10, 2013

Et tu, Wegmans?

The Rochester-based grocer that has been continually lauded for providing health insurance to its part-time workers will no longer offer that benefit.

Until recently, the company voluntarily offered health insurance to employees who worked 20 hours per week or more. Companies are required by law to offer health insurance only to full-time employees who work 30 hours or more per week.

Wegmans employs roughly 1,433 full-time employees and 4,304 part-time employees in the Buffalo Niagara region.

Several Wegmans employees confirmed part-time health benefits had been cut and said the company said the decision was related to changes brought about by the Affordable Care Act.

However, part-time employees may actually benefit from Wegmans’ decision, according to Brian Murphy, a partner at Lawley Benefits Group, an insurance brokerage firm in Buffalo.

“If you have an employee that qualifies for subsidized coverage, they might be better off going with that than a limited part-time benefit,” Murphy said.

That’s because subsidized coverage can have a lower out-of-pocket cost for the insured employee while also providing better benefits than an employer-paid plan.

Under the Affordable Care Act, part-time employees are not eligible for health insurance subsidies if their employer offers insurance.

“It’s a win-win. The employee gets subsidized coverage, and the employer gets to lower costs,” Murphy said.

“As a private company, we don’t share specifics of our employee benefits programs. It’s a given that health care reform will result in some changes to our benefits program, but it will not change our commitment to meeting the needs of our employees,” Wegmans said in a statement.

http://www.buffalonews.com/apps/pbcs.dll/article?AID=/20130710/BUSINESS/130719892/1003

Comment:

By Don McCanne, M.D.

The best coverage for part-time workers? Well, for part-time workers and for everyone else, it would be a single payer national health program. But we don’t have that. So, before we can enact an improved Medicare for everyone, what would be the best way to cover part-time workers under the Affordable Care Act?

During the reform process, the plight of the part-time worker remained an important consideration in trying to design a near-universal system (which it didn’t turn out to be). Part-time workers tend to have very low wages making it impossible to purchase decent insurance on their own, and yet their family incomes are often just barely high enough that they do not qualify for Medicaid.

Congress decided to continue to rely heavily on employer-sponsored health plans for coverage. The problem with part-time workers is that most employers either provided them with no coverage at all, or, if they did, the coverage was often so spartan that it was almost worthless. Although it was decided to require all but the smallest employers to provide employee coverage or face financial penalties, legislators yielded to larger employers who wanted part-time employees to be exempt. The threshold qualifying as part-time was set at 30 hours.

Think of all of the occupations in which flexible, part-time positions are ideal. Large retail sellers, supermarket chains, restaurant and fast food chains, hospitality services, and so forth, serve as examples. Labor costs are a great concern for these employers, and they have struggled with the concept of trying to meet the high costs of adequate health benefit programs.

But look at the opportunity they have with the 30 hour threshold. They no longer have to feel guilty about providing only worthless plans or no plans at all. Under the Affordable Care Act, the government is going to provide part-time employees subsidies inversely related to income, supposedly allowing these people to buy more comprehensive coverage through the exchanges. Employers can walk away, and these employees will get a better deal from the government.

Although it may be a better deal, it’s still not such a hot prospect. Even with subsidies for both premiums and out-of-pocket expenses, these low income individuals will still not be able to afford their portion of the costs and will face financial hardship as a result.

So these employers will be relieved of their responsibility of paying for health care coverage for their part-time employees, and the taxpayers will pick up the tab. Although there are important reasons for bringing an end to employer-sponsored coverage, it is unfair to give these employers special breaks, especially when considering that several members of the Walton family are near the top of the billionaires list. We should pay more taxes so that they can collect more billions?

No. This “win-win,” wherein “the employee gets subsidized coverage, and the employer gets to lower costs,” is a loser for health care equity and justice. As said at the start, we need a single payer national health program.

Problems with Affordable Care Act show need for single-payer system

By Toni Vafi
St. Louis Post-Dispatch, July 11, 2013

As promises of the Affordable Care Act continue to wither, the delay of the employer mandate is cause for more disappointment. Initially there was promise of average savings of $2,500 per family annually and visions of a public option. Universal coverage was assured and the oft-stated “if you like your employer based insurance, you can keep it” was evidence that we weren’t going socialist. These were a few of the goodies we expected under the Patient Protection and Affordable Care Act.

What happened? Gone are the $2,500 savings and the public option. Cost control wasn’t part of the ACA. The public option bothered insurance companies, so it was out. Of 60 million uninsured, the ACA will leave at least 30 million still without coverage, and the employer mandate delay will now surely increase the implementation burden on the exchanges, which might not be ready to go by Oct. 1.

Not to worry. Employers that have been unable to come up with a plan over the past four years are mainly employers of lower wage and temporary workers. These workers might receive subsidized plans on the exchanges. According to the Post-Dispatch (“Delay in health care law raises questions,” July 4), some employers expect to save millions during this one-year delay, millions to be picked up by the taxpayers. Most of the 30 million newly insured will be exchange or Medicaid clients, also to be funded in full or subsidized by the federal government. While I never begrudge the use of federal funds for health care, I do begrudge this elaborate plan giving insurance companies a third of those federal funds to shuffle paper and deny care, while earning huge profits for themselves.

If medical care is to be funded by tax dollars, let’s skip the hogwash and go directly to a single-payer system, which saves billions and provides equitable care for all.

http://www.stltoday.com/news/opinion/mailbag/letters-to-the-editor/problems-with-affordable-care-act-show-need-for-single-payer/article_8265fb30-b93e-5235-b7a4-4eab45811972.html

The State of US Health: Older but Sicker

The State of US Health, 1990-2010

By US Burden of Disease Collaborators
JAMA, July 10, 2013

Objectives

To measure the burden of diseases, injuries, and leading risk factors in the United States from 1990 to 2010 and to compare these measurements with those of the 34 countries in the Organisation for Economic Co-operation and Development (OECD) countries.

Design

We used the systematic analysis of descriptive epidemiology of 291 diseases and injuries, 1160 sequelae of these diseases and injuries, and 67 risk factors or clusters of risk factors from 1990 to 2010 for 187 countries developed for the Global Burden of Disease 2010 Study to describe the health status of the United States and to compare US health outcomes with those of 34 OECD countries.

Results

US life expectancy for both sexes combined increased from 75.2 years in 1990 to 78.2 years in 2010; during the same period, HALE (healthy life expectancy) increased from 65.8 years to 68.1 years. The diseases and injuries with the largest number of YLLs (years of life lost due to premature mortality) in 2010 were ischemic heart disease, lung cancer, stroke, chronic obstructive pulmonary disease, and road injury. Age-standardized YLL rates increased for Alzheimer disease, drug use disorders, chronic kidney disease, kidney cancer, and falls. The diseases with the largest number of YLDs (years lived with disability) in 2010 were low back pain, major depressive disorder, other musculoskeletal disorders, neck pain, and anxiety disorders. As the US population has aged, YLDs have comprised a larger share of DALYs (disability-adjusted life-years) than have YLLs. The leading risk factors related to DALYs were dietary risks, tobacco smoking, high body mass index, high blood pressure, high fasting plasma glucose, physical inactivity, and alcohol use. Among 34 OECD countries between 1990 and 2010, the US rank for the age-standardized death rate changed from 18th to 27th, for the age-standardized YLL rate from 23rd to 28th, for the age-standardized YLD rate from 5th to 6th, for life expectancy at birth from 20th to 27th, and for HALE from 14th to 26th.

Conclusions and Relevance

From 1990 to 2010, the United States made substantial progress in improving health. Life expectancy at birth and HALE increased, all-cause death rates at all ages decreased, and age-specific rates of years lived with disability remained stable. However, morbidity and chronic disability now account for nearly half of the US health burden, and improvements in population health in the United States have not kept pace with advances in population health in other wealthy nations.

http://jama.jamanetwork.com/article.aspx?articleid=1710486

Comment:

By Don McCanne, M.D.

According to The Washington Post (July 10), Thomas R. Frieden, director of the Centers for Disease Control and Prevention “noted that the United States is among the last of its economic peers in offering universal health care, and it is late in making societal changes to address the risks that needlessly shorten lives.” He said, “The good news is these are things we can do something about. If you look at the county-by-county charts, it shows in communities where they took improvements in health seriously, they were able to see dramatic improvements.”

With our great wealth, we can do both. We can offer universal health care, and we can expand public health programs, including fostering societal changes that address our health risks. But first we need to elect legislators and administrators who support these goals. It’s really up to us.

Public Citizen's 'Road Map to State Single Payer'

By Healthcare-NOW’s national staff
Healthcare-NOW, July 10, 2013

This year, some of our movement’s most inspirational organizing has focused on state-level single-payer healthcare legislation. Consequently, our ally Public Citizen released a report today titled “A Road Map to ‘Single Payer’: How States Can Escape the Clutches of the Private Health Insurance System.” The report aims to help state legislators and activists navigate the legal and legislative hurdles facing state-level single-payer efforts.

If you are active in a state single-payer campaign, we encourage you to download the report and share it with allies in your legislature.

Inspired by Vermont’s law designed to move the state through a series of phases culminating in a single-payer system, many other states have impressed us this year. Oregon activists organized a 1,000-person rally that resulted in passing a bill that compares the costs of single-payer with other healthcare financing systems. New York activists delivered over 10,000 signatures for single payer to legislators that resulted in securing a majority of the state Assembly supporting their state single-payer bill. Colorado activists launched a statewide ballot initiative to make access to healthcare a constitutional right, and is in the process of collecting 100,000 signatures.

Many states, however, do not enjoy the luxury of a state legislature that offers hope for single-payer legislation. We hope state-level victories will inspire national activism for achieving a right to healthcare for all, regardless of geography, income, or other social identities.

We hope that this Road Map will serve as a helpful tool in states’ organizing toolbox, and that you will share it with your network.

Sincerely,
Ben, Zoraida, and Jeff
Healthcare-NOW! National Staff

Healthcare-NOW! is a grassroots organization that addresses the health insurance crisis in the U.S. by educating and advocating for the passage of expanded and improved Medicare-for-all legislation, such as HR 676. Healthcare-NOW! – (800) 453-1305 – 1315 Spruce Street, Philadelphia, PA 19107.

PNHP note: For additional analysis of Public Citizen’s report, see “How states can get close to a single-payer system” by PNHP’s senior health policy fellow, Dr. Don McCanne.

Medicare for all

By Jack Bernard
Modern Healthcare, Letters, July 6, 2013

Hospital board members make decisions based on the mission of their organizations, not solely on how to increase the bottom line. Similarly, we can’t just let our fellow citizens suffer, expecting the free market to magically take care of the problem of the uninsured and underinsured. The market has not done so; the percentage of uninsured has risen drastically nationwide. The Affordable Care Act will not eliminate the problem, only slow it down.

It is up to us to choose what sort of a country we really are, a nation of compassion or a Darwinian society in which the strong ruthlessly trample the weak. If we view ourselves as the moral beacon of the world, then we must take care of the less fortunate here. And that means national health insurance for all, not only those over 65. I have witnessed the fatuous arguments about expanding Medicare, about it being “too expensive.” Countries with single payer have better healthcare outcomes than we do and spend much less per capita. Healthcare should be a right for all Americans, not a privilege. The best way to achieve that goal is Medicare for all.

Jack Bernard is a retired healthcare executive in Monticello, Ga.

http://www.modernhealthcare.com/article/20130706/MAGAZINE/307069980/medicare-for-all-and-other-letters&template=mobile

PNHP note: An archive of opinion pieces by Jack Bernard can be found here.

How States Can Get Close to a Single-Payer System

Public Citizen Releases Road Map for States to Achieve Unified, Universal Health Care; Distributes to State Lawmakers Throughout U.S.

Public Citizen, July 10, 2013

WASHINGTON, D.C. – The steps a state would need to take to move toward creating a single-payer health care system are somewhat complicated but are doable, according to a new Public Citizen report that provides states with a road map of how to achieve unified, universal health coverage.

A state could not hope to achieve a pure single-payer system, such as exists in Canada, because of federal programs, such as Medicare and Medicaid. But many of the ambitions of a single-payer system can be realized at the state level, the report explains. A state can accomplish much that the Affordable Care Act (ACA), or Obamacare, does not: provide universal care, greatly increase administrative efficiency and control costs.

Public Citizen distributed the report to state lawmakers throughout the country through the state affiliates of Health Care NOW. The report is available (at the link below).

“The facts are simple: We pay far more for health care than any developed country, yet we cover fewer people and get worse results,” said Dave Sterrett, health care counsel for Public Citizen’s Congress Watch division. “It’s time for real change.”

Calling for a universal care system in the United States is often painted as a quixotic pursuit because of incessant fear-mongering by conservatives about the supposed evils of a “government takeover” of health care.

But the report, A Road Map to “Single-Payer”: How States Can Escape the Clutches of the Private Health Insurance System, points out that Americans polled in 2012 were nearly evenly divided when asked if they favored a single-payer system, and this was amid the relentless drumbeat of opposition to the ACA. Evidence suggesting support for the single-payer concept also can be found in Americans’ widespread approval of Medicare, the government-run program that provides nearly universal care to those over 65 at far less cost than care that is reimbursed by private insurance companies.

The first step on a state’s road to a quasi-single payer system is to obtain a waiver from the ACA. This is well within reach because the act includes language that permits a state to receive a waiver from the ACA’s strictures, beginning in 2017. A state can be granted this waiver if it demonstrates that its alternative would provide coverage at least as good, for at least as many people, as the ACA would, and not add costs to the federal budget. For states that receive waivers, the federal government must provide funds to the state that equal what it would spend pursuant to the ACA. A state promising to provide comprehensive, universal care would easily clear this hurdle.

Achieving integration between a state system and Medicare and Medicaid would be more difficult because the law does not permit a broad waiver from these programs. But the law does provide ample room for the administration of these programs within a state to be altered to align billing systems and prices. This would allow Medicare and Medicaid to appear to providers and patients to be almost seamlessly integrated with a state system, although this strategy would require a state to dedicate resources to reconcile claims with the federal government.

The other major legal hurdle for a state to overcome is posed by the 1974 Employee Retirement Income Security Act (ERISA), which forbids states from regulating employer benefits plans. But a small body of case law provides grounds for cautious optimism that the hurdles of ERISA can be overcome. A state could insulate its system from being struck down on ERISA grounds by legislating alternative funding options, such as payroll, income or sales taxes.

The final major hurdle is determining how to pay for a universal care system. Transitioning from a system largely financed by employer and employee-paid insurance premiums to one likely financed by some combination of taxes would be challenging.

But the transition should not hurt employers or residents in the long run, the report concludes. A proposed system in Vermont, for instance, would significantly expand both the quality of benefits and the number of people covered. Yet Vermont’s plan would cost slightly less than the state’s current system, according to analysis commissioned by the state.

“Single-payer in the United States has been scorned but never tested,” said Lisa Gilbert, director of Public Citizen’s Congress Watch division. “We’re looking for a few pioneering states with the courage and fortitude to let common sense prevail over the insanity of our current patchwork system. Once they succeed, we expect most opposition to single-payer and our reliance on privately insured health care to become historical relics.”

http://www.citizen.org/road-map-to-single-payer-health-care-report

Report – “A Road Map to ‘Single-Payer'” (21 pages): http://www.citizen.org/documents/road-map-to-single-payer-health-care-report.pdf

Comment:

By Don McCanne, M.D.

This very useful Public Citizen report on steps toward single payer at the state level serves two important functions:

1)  Although the Affordable Care Act is providing a few beneficial tweaks to the financing of our health care system, by now it is obvious that, by building on our dysfunctional, fragmented system, intolerable health care injustices will be perpetuated. Yet Congress itself is currently so dysfunctional that it is impossible to get them to consider a vastly superior alternative – a single payer Improved Medicare for All.

For those who cannot wait until we are able to elect a sane supermajority in Congress, this report provides suggestions on how some single payer principles could be applied at the state level. Although that pathway is rugged and cannot lead all the way to single payer, at least it would provide more improvement than we are seeing with the Affordable Care Act. There is plenty in this report to keep health justice activists very busy on the state level.

2)  The far more important conclusion to be drawn from this report is that states acting alone cannot establish a bona fide single payer system. There are too many major barriers that would prevent states from totally replacing their fragmented financing infrastructure. Under current federal laws, limitations imposed on states would not allow them to capture many of the more effective benefits of the single payer model.

Although states could come much closer to universal coverage, their systems would still perpetuate many of the inefficiencies and inequities that exist today. Without the power of a public, single payer monopsony (a single buyer), improving allocation of our resources would be much more difficult. Although states could improve billing functions, that captures only a very small portion of the profound administrative waste in our system. Any savings on a state level would be very modest and would not be enough to pay for the elimination of uninsurance and underinsurance. Total health care costs would increase even more, when costs are already intolerable.

The lesson? We cannot let up in the least in our efforts to educate the nation on the imperative of a single payer national health program. To be unequivocally clear, that’s NATIONAL.

We cannot use the example of Saskatchewan and pretend that a state can set up a single payer system that could serve as an example for the nation – a model that could be expanded to all states. No. Saskatchewan began with a tabula rasa. They were able to create a de novo single payer system. The Public Citizen report shows us that our existing federal laws create complexities that would prevent states from enacting a financing model that could be held up to the rest of the
nation as an example of the benefits of single payer, even though that is a noble intent of the report. In fact, there is a risk that such an effort would allow opponents to claim, “See, single payer doesn’t work.”

Vermont is currently implementing legislation that originally was intended to bring it a single payer financing system. But they found that a bona fide single payer system is not possible, so they have abandoned the term, “single payer.” That might be wise advice for other state activists.

We cannot allow enthusiasm for state efforts to diminish in the least the exhaustive effort that will be required to reach the threshold of political feasibility that will be a requisite to motivate Congress to take action.

Reasons for Outrage on Health Care

By Laura S. Boylan, M.D.
The New York Times, Letters, July 9, 2013

Re “Diagnosis: Insufficient Outrage,” by H. Gilbert Welch (Op-Ed, July 5):

As medical “cost sharing” (read: “cost shifting”) grows, hidden costs will be revealed, and outrage, already simmering, can be counted on coming to a boil. We need to stop pretending that the rules of the market will provide us with high-quality, high-value health care and join the rest of the developed world with universal health insurance.

Medicare’s 48th birthday is coming up this month. Let’s expand and improve on this most successful and popular of American institutions with publicly financed and privately delivered single-payer health care for all.

The writer is a clinical associate professor of neurology at New York University School of Medicine.

Burdened by insurance paperwork

By Melvin W. Young, M.D.

 We doctors should “rage” against a system so perverse that on any given day a physician may treat 15 patients with as many insurance plans requiring unproductive paperwork. It is a system so perverse that it forces us to hire clerks whose only role is to seek authorization for needed procedures.

It is a system so skewed against us that a letter from a lawyer sets our hearts racing. A system so out of control that chief executives of major insurance companies make salaries in the millions of dollars as we doctors struggle to meet payroll and pay the rent.

The excesses in the system may justifiably lead to outrage, but we doctors are likewise outraged at the blame heaped upon us for a failed system not of our creation.

The writer is a cardiologist. He lives in Dover, Vt.

http://www.nytimes.com/2013/07/10/opinion/reasons-for-outrage-on-health-care.html?_r=0

First do no financial harm

First, Do No (Financial) Harm

By Christopher Moriates, MD; Neel T. Shah, MD, MPP; Vineet M. Arora, MD, MAPP
JAMA, July 8, 2013

“First, do no harm” is a well-established mantra of the medical profession, but it may need to be reconceptualized in an era of unsustainable health care spending. Medical bills are now a leading cause of financial harm and physicians decide what goes on the bill. The possible consequential harm is substantial, often leading to lost homes and depleted savings. While the Affordable Care Act will ensure expanded coverage, newly insured Americans will not necessarily be immune from increased costs of their care. More Americans than ever before are enrolled in high-deductible insurance plans, meaning that seemingly simple decisions that physicians make about testing could directly lead to thousands of dollars in out-of-pocket costs. This strain on household budgets can cause further erosion of personal health.

Just as physicians play an important role in preventing serious infections, physicians can also help patients avoid experiencing financial harm as a result of medical care.

SCREEN FOR FINANCIAL HARM

First, physicians can help patients avoid financial harm by screening each patient to determine financial risk and preferences.

ADOPT A UNIVERSAL APPROACH

In 2007, the majority of medical debtors had health insurance at the beginning of their illness, and an estimated 25 million Americans were underinsured. Hence, it is increasingly difficult to know which patients will be faced with insurmountable medical bills in the near future. Since physicians cannot be sure which patients will ultimately have unaffordable medical bills, they should treat all patients as if they could be.

This approach applies to both inpatient and outpatient encounters because patients often face significant financial obligations in both settings. Although physicians may assume that hospitalizations for insured patients are automatically covered by health plans, in reality these patients may still face large co-payments. Thus, in some instances whether hospitalization can be avoided should be discussed. In addition, the payer may refute the appropriateness of admission or leave coverage gaps due to high deductibles, caps, or other cost-sharing mechanisms. In the ambulatory care setting, patients may pay a percentage of the fees for services.

UNDERSTAND FINANCIAL RAMIFICATIONS AND VALUE OF RECOMMENDATIONS

Many studies demonstrate that physicians are unaware of the cost of routinely ordered tests, let alone the potential financial risks for patients seeking care. To explain potential options and their fiscal implications to patients, physicians will need to take responsibility for knowing the financial ramifications of the care they are providing.

OPTIMIZE CARE PLANS FOR INDIVIDUAL PATIENTS

Physicians also should learn how to optimize personalized health care decisions for patients’ financial health.

CONCLUSIONS

Financial concerns are important to patients and physicians need to be prepared to address this aspect of their care. Although these financial discussions may present some challenges, physicians already participate in difficult discussions with patients about opiate abuse, domestic violence, and end-of-life decisions. To provide truly patient-centered care, physicians can live up to the mantra of “First, do no harm” by not only caring for their patients’ health, but also for their financial well-being.

For the full JAMA article (free access):
http://jama.jamanetwork.com/article.aspx?articleID=1709839

Comment:

By Don McCanne, M.D.

In these days of outrageous health care costs physicians now have not only the obligation to provide care as close to optimal as the circumstances will allow, they also have an obligation to prevent personal financial harm to the patient that could result from their medical decisions. But should the latter really be the physicians’ obligation?

The authors of this JAMA article list steps to be followed during patient encounters designed to prevent financial harm to patients. Doesn’t the physician already have enough to do without having to become the keeper of the patients’ pocketbooks? Unfortunately, under our current dysfunctional system of financing health care, too many patients face significant financial barriers to care. The physician remains the person in charge of determining the magnitude of those barriers, simply based on the medical management selected.

The Affordable Care Act will not help much since the new standard for private insurance is low actuarial value, high-deductible plans. In fact, the financial barriers will become more commonplace as employers are now greatly expanding the use of consumer-driven, high-deductible plans.

Patients who previously weren’t concerned much about their out-of-pocket costs are now going to want more information from physicians about what their own plans will or will not cover, how much they will have to pay out-of-pocket, whether the specialists or diagnostic facilities are in or out of their networks, which prescriptions are covered and under what tier, and many other spending issues for which the physicians frequently do not have the answers. Yet knowing the answers is now becoming the responsibility of physicians?

Why do we have a system with so much financial exposure to patients when other nations have much lower national health expenditures with cost sharing usually at negligible levels? It is because of the nutty idea that only patients can control costs when they have to pay out-of-pocket (consumer-driven health care), when we know that is absolutely untrue. Other nations have proven that there are far more effective methods of controlling costs that not only provide financial security for the patients, but also improve the allocation of health care dollars, providing higher quality and greater value.

Physicians should be leading the bandwagon in first doing no financial harm by supporting a system that totally separates financing from the clinical environment. If they could convince the nation that we need a single payer national health program then they could proceed with tending to patients’ health care needs while letting our own public administrators deal with the financing of the system.

Financial barriers harm patients. It is our obligation to first do no harm by removing those barriers – for everyone. Then we can get on with simply taking care of the patients.

Night terrors of the uninsured

For all of the promise of the Affordable Care Act, it has holes.

By Diana Wagman
Los Angeles Times, July 6, 2013

It’s 3:14 a.m.

I’m awake. Every night for the last six months, my eyes have opened just after 3. It’s my personal witching hour when my demons come out of the closet and surround the bed whispering messages of doom. My husband sleeps on, oblivious. I’ve developed some tricks to keep the creatures at bay. I count backward, I count my blessings, I recite what little poetry I know by heart. If I start listening to the goblins, that’s it, I’m up for the duration.

What am I worried about? I have smart, healthy children, one college graduate and one in college. I have a house and a husband and a car. What I don’t have is a job. And because I’m unemployed, we don’t have job-based health insurance. My husband works hard. He works a lot. But he’s always been freelance, and he’s hardly ever had insurance. That’s what I get from my kind of work, teaching at the university level — never much in the way of salary, but benefits. Now the work has dried up and I’m benefit-less again.

I had a great one-year appointment teaching at a California State, with wonderful colleagues and interesting students. When the school decided to make the job a permanent position, I couldn’t apply. I didn’t have the required advanced degree. Twenty years working in my field, four published books and many published articles and stories, and I wasn’t eligible to continue doing exactly what I’d been doing. I know it has to do with the school’s accreditation. My department would have kept me if it could, but it couldn’t. I looked into getting that advanced degree and was even accepted at a school nearby, but I wouldn’t have been able to have the degree “in hand” by the time the permanent job started this fall.

So I’m out of work. Again. And because healthcare in this country is tied to employment, we are out of luck. Again. I had cancer. My daughter was hit by a car and got a concussion and a fractured ankle. I know bad things can happen to me, to my family. We have to have health insurance. And we have to pay for it ourselves. And that keeps me up at night.

I was excited when the Affordable Care Act was introduced. I thought it was about time everybody in this country had insurance. I believed it was ridiculous that we’re the only wealthy, Western nation without universal care. But the Affordable Care Act is not universal care. It’s not the single-payer system I so hoped for. It’s a step in the right direction, but for people like my husband and me, who make a pretty good income, it’s unlikely to give us any kind of break. We’ll still have to pay for our insurance entirely ourselves, and I’m not optimistic the price will go down.

Thanks to the Affordable Care Act, my new insurance company can’t deny me because I had cancer. Unfortunately, at least until January, when additional provisions of the law go into effect, they can charge me for it. For my family of four, to get care comparable to what I had through the CSU, we will spend $1,500 a month, or $18,000 a year. That’s a lot of money. I have to teach a lot to make that. The insurance through my former job was fantastic. We could choose our doctors, our co-pay was low and our deductible very reasonable.

We had that same insurance when I was diagnosed with cancer. Back then I was working at a different Cal State school and thank God I was. Without insurance, we would have lost our house, decimated the college funds, spent every bit of savings we had, and, six years later, I’m sure we’d still be paying off those bills. Or we would have gone bankrupt. Some 700,000 Americans every year declare bankruptcy because of medical bills. The number in Japan? Zero. The number in Germany? Zero.

I was lucky my cancer diagnosis came when it did. I had a job and I kept it until a year after treatment, when, due to budget cuts to the CSU system, I was laid off. We went on COBRA, because no other insurance would have me — the cancer survivor — until this latest job came along. COBRA is even more expensive now.

“Do something else,” the demons whisper. I have poured over Craigslist looking for different kinds of work. I recently applied to be an animal control officer — no lie — but withdrew my application when I read the blog, “A day in the life of an animal control officer.” Too sad, too confrontational, too many pit bulls for me. And really, I love teaching. It’s what I have done for 20 years.

“Go back to school,” other demons — and my husband — sometimes say, but it’s expensive, we’re already paying my daughter’s college tuition, and I’m in my 50s. Who’s going to hire me as a full-time teacher for a permanent position when I’d be eligible to retire in less than 10 years? And if some school does hire me two years from now, will I work long enough to pay back my college loans?

I could hobble along, teaching where I can, doing some independent work, and my income would pay my daughter’s tuition or at least her living expenses, if it wasn’t for our health insurance. The Affordable Care Act mandates I have it, and I know my family needs it, but paying for it means other things will suffer. We’re not poor, I don’t want to suggest that we are, but we will have to make some hard choices if I’m not working and we’re paying $1,300 a month to an insurance company.

I had hoped that, under the new healthcare system, essential services for everybody would be covered by the government, as they are in every other First World country. At the very least I wanted the Affordable Care Act to be what it says it is: affordable care for everybody.

That said, I’m glad that an insurance provider can no longer deny me for having had cancer and that our unemployed son can stay on our insurance until he’s 26. By then, I tell myself, surely he will have a full-time job.

“But will his job have benefits?” Those are my 3 a.m. demons hissing at me again. And I have no answer for them.

Diana Wagman’s most recent novel is “The Care and Feeding of Exotic Pets.”

Latest handout to big insurers hurts Medicare

Instead of attacking Medicare, we should be expanding it to all

By Johnathon Ross, M.D.
The Blade (Toledo, Ohio), July 4, 2013

Medicare’s costs will jump by $7.43 billion next year because of an unprecedented decision by the federal government to change payment rates for private, for-profit Medicare Advantage plans.

The government’s action will result in a huge financial windfall for big health insurers, whose Washington lobbyists pushed hard for the new rates.

Enrollment in privately run Medicare Advantage plans, which cover 13.1 million beneficiaries, was expected to dip sharply over the next few years, because of a planned reduction in government overpayments to these plans.

Studies by the Government Accountability Office and many private groups repeatedly have drawn attention to these overpayments. These studies suggest that if the 13.1 million beneficiaries were enrolled in the traditional Medicare program, their costs of care would have been 14 percent lower than the payments made to the private plans, with no loss in the quality of care.

The overpayments occur because private Medicare Advantage plans tend to enroll healthier, less-costly seniors, yet they receive a larger average payment per enrollee from the government.

The Affordable Care Act also acknowledged these overpayments. Yet the secretary of health and human services, Kathleen Sebelius, has announced that a scheduled 2.2 percent reduction in payments to the for-profit plans this year will now become a 3.3 percent increase instead.

The extraordinary rate-setting directive from Ms. Sebelius to the Centers for Medicare and Medicaid Services (CMS), which spurned historical practice and the advice of the CMS actuary, will result in an obscene windfall for the private, for-profit insurers.

This announcement, leaked shortly before the stock market closed, caused stock prices for the nation’s five largest for-profit health insurers to surge over the next week. That yielded an instant $13.2 billion bonanza for investors.

UnitedHealth reaped the largest windfall. Based on its share of the market, UnitedHealth will receive an extra $1.49 billion from Medicare for its Medicare Advantage plans in 2014, and $14.3 billion to $20.9 billion over the next decade, triggering a $5.04 billion surge in the value of UnitedHealth’s stock.

Other plans saw similar gains. But taxpayers will foot the bill.

It is hard to fathom how we can allow this massive payout to private insurers, when some in Congress are proposing higher premiums, higher out-of-pocket payments, and even vouchers to undermine traditional Medicare, instead of shoring it up. These bonus payments to the privately run plans will further divert resources from the more efficient traditional Medicare program.

Instead of attacking Medicare, we should be improving it and expanding it to all. The traditional Medicare program has worked for more than 50 years to cover our most vulnerable disabled friends, neighbors, parents, and grandparents.

Medicare came into existence because the private insurance industry would not cover seniors and disabled people. Being old and disabled are pre-existing conditions. Medicare would be an excellent model for providing health care to all, and superior to the Affordable Care Act.

The Affordable Care Act will cover only half of the 50 million uninsured Americans. It will cost an extra $100 billion a year, because it builds on a “sickness care” system run by wasteful private insurance companies. Thanks to those companies, our health care is saddled with about $400 billion a year in unnecessary bureaucracy and paperwork.

Studies suggest that by replacing costly private insurers with a streamlined nonprofit agency that pays all medical bills, similar to how Medicare operates today, we could cover everyone and upgrade existing coverage at no added cost.

Research consistently has shown that for-profit health care and insurance produces worse outcomes at higher prices. When will we conclude that health care is a basic human need and provide it to all our fellow citizens, just as we together support education, police, and fire and rescue services?

Expanding Medicare to all Americans would save lives and money. It is the right thing to do.

Dr. Johnathon Ross of Ottawa Hills is past president of Physicians for a National Health Program, which supports single-payer national health insurance.

http://www.toledoblade.com/Opinion/2013/07/04/Latest-handout-to-big-insurers-hurts-Medicare.html

Why physicians must reclaim their profession

By Andrew D. Coates, M.D., F.A.C.P.

The 10-minute YouTube video found after the jump shows Dr. Andrew Coates of upstate New York, president of Physicians for a National Health Program, speaking at a program organized by Maryland’s Healthcare is a Human Right Campaign in Columbia, Md., on June 27.

Excerpt: “We need to claim our proper place in society and part of doing that is advocating for a national health program, nothing less than something that will provide comprehensive care for absolutely everyone.”

Watch Dr. Coates on restoring integrity and justice to the medical profession by fighting for universal health care, and hear his thoughts on why doctors can no longer stand for an exclusionary and privatized system.

Insurers game risk against each other

Do Insurers Risk-Select Against Each Other? Evidence from Medicaid and Implications for Health Reform

By Ilyana Kuziemko, Katherine Meckel and Maya Rossin-Slater
National Bureau of Economic Research, Working Paper 19198, July 2013

Abstract

Increasingly in U.S. public insurance programs, the state finances and regulates competing, capitated private health plans but does not itself directly insure beneficiaries through a public fee-for-service (FFS) plan. We develop a simple model of risk-selection in such settings. Capitation incentivizes insurers to retain low-cost clients and thus improve their care relative to high-cost clients, who they prefer would switch to a competitor. We test this prediction using county transitions from FFS Medicaid to capitated Medicaid managed care (MMC) for pregnant women and infants. We first document the large health disparities and corresponding cost differences between blacks and Hispanics (who make up the large majority of Medicaid enrollees in our data), with black births costing nearly double that of Hispanics. Consistent with the model, black-Hispanic infant health disparities widen under MMC (e.g., the black-Hispanic mortality gap grows by 42 percent) and black mothers’ pre-natal care worsens relative to that of Hispanics. Remarkably, black birth rates fall (and abortions rise) significantly after MMC—consistent with mothers reacting to poor care by reducing fertility or plans discouraging births from high-cost groups. Implications for the ACA exchanges are discussed.

From the Introduction

In summary, under MMC, infants whose costs are likely to exceed the capitation payment die more frequently, experience worse health outcomes, receive diminished care, or are not born at all.

From the Conclusion

Introducing risk-adjustment could potentially address the risk-selection results we have presented, though, historically, governments have been reluctant to risk-adjust based on race. Adjusting based on past health conditions is very challenging in the MMC setting and, as previously noted, is rarely attempted. First, plans would have to submit some accounting of their clients’ health conditions to the government, so “intensive” coding becomes a problem, as it is in Medicare Advantage and the Medicare Prospective Payment System. Second, while Medicare can calibrate a risk-adjustment formula by regressing enrollee costs on dummies for past health conditions using cost and claims data from its FFS pool, state governments under MMC typically do not have a public FFS option and thus will not have the cost and claims data that Medicare uses. Third, risk-adjustment formulae typically document existing health conditions using twelve months of pre-data, and use this information to forecast costs for the following twelve months. A stable client population – as in Medicare – is thus required, a challenge in Medicaid given the “churning” of the client base.

Each of these three challenges would seem to apply equally to the ACA state exchanges. Regulators will rely on insurers’ accounting of client health conditions, and as there is no public FFS option they will not have their own cost and claims data. And as the exchanges serve those too rich for Medicaid but not so well off as to have employer insurance, their clients will likely come and go based on outside options – if their situation improves, then they will move into employer insurance; if their situation deteriorates, then they may need to switch to Medicaid.

With Medicaid Managed Care, the ACA exchanges, Medicare Part D and the prominence of Medicare premium-support proposals, the U.S. is moving rapidly toward providing public health insurance through a model of competing, capitated private insurance plans. Past work has identified challenges associated with this model, including the increase in costs that come with insurers losing monopsony bargaining power over providers and consumers’ cognitive overload from choosing among a large set of options. Our work points to an additional concern arising from consumer choice – it tempts insurers to under-serve high-cost clients in the hope they will switch to a competitor.

http://www.nber.org/papers/w19198

Comment:

By Don McCanne, M.D.

The conclusions of this study are shocking, even if predictable.

It has already been established that private Medicare Advantage plans engage in surreptitious activities that result in enrollment of lower-cost, healthier patients, while both avoiding higher-cost patients, and engaging in behaviors that cause higher-cost patients to disenroll (cherry picking and lemon dropping). This shifts higher-cost patients to the traditional public Medicare program, while the private insurers increase profits by continuing to game risk selection.

This study is different because all of the Medicaid patients who were formerly insured through a public program were transferred to private Medicaid managed care programs. Thus there was no public program where the private plans could dump their high-cost patients. So what did they do? They dumped them on their private Medicaid managed care competitors!

What is particularly shocking is the way they did it. They spent more money on the healthier patients to keep them contented so they would stay in their plans, while reducing spending and giving worse service to their higher-cost patients, ensuring dissatisfaction because of the worse outcomes that the patients suffered. Particularly distressing to advocates of social justice is that the high-cost patients discriminated against in this Texas study were predominantly black.

This study provides an important lesson for the insurance exchanges being established under the Affordable Care Act. Since a “public option” was rejected, the exchanges will include only private plans competing with each other. What kind of behavior can we expect? The most effective way for the private insurers to dump high-cost patients onto their competitors will be to give them worse care with terrible outcomes, causing their patients to flee. Of course, there is nowhere else to turn except to other private insurers, though some patients might even consider that paying a penalty for remaining uninsured might be a better option. Then again, remaining uninsured is not a realistic option for those who need higher-cost care.

It’s the same old bottom line. We can either have a publicly administered system dedicated to a patient service ethic, or we can have a privately administered insurance system dedicated to a common business ethic, no matter how cutthroat. Aren’t we making the wrong choice?