PNHP

Health law, constitutional or no, fails to remedy ailment: doctors group

Health law, constitutional or no, fails to remedy ailment: doctors group

FOR IMMEDIATE RELEASE
March 26, 2012

Contact:
Garrett Adams, M.D., president PNHP
Andrew Coates, M.D., president-elect PNHP
Oliver Fein, M.D.
David Himmelstein, M.D.
Steffie Woolhandler, M.D.
Mark Almberg, PNHP communications director, (312) 782-6006, mark@pnhp.org

Leaders of Physicians for a National Health Program, an organization of 18,000 doctors who advocate for single-payer national health insurance, released the following statement today:

Regardless of whether the Supreme Court upholds or overturns the Affordable Care Act in whole or in part, the unfortunate reality is that federal health law of 2010 will not work: (1) it will not achieve universal coverage, as it leaves at least 26 million uninsured, (2) it will not make health care affordable to Americans with insurance, because gaps in their policies will leave them vulnerable to bankruptcy in the event of major illness, and (3) it will not control costs.

Why? Because the ACA perpetuates a dominant role for the private insurance industry.  That industry siphons off hundreds of billions of  health care dollars annually for overhead, profit and the paperwork it demands from doctors and hospitals; it denies care in order to increase insurers’ bottom line; and it obstructs any serious effort to control costs.

In contrast, a single-payer, improved-Medicare-for-all system would achieve all three goals – truly universal, comprehensive coverage; health security for our patients and their families; and cost control. It would do so by replacing private insurers with a single, nonprofit agency like Medicare that pays all medical bills, streamlines administration, and reins in costs for medications and other supplies through its bargaining clout.

The major provisions of the ACA do not go into effect until 2014. Although we will be counseled to “wait and see” how this reform plays out, we’ve seen how comparable reforms in Massachusetts and other states have worked over the past few decades. They have invariably failed our patients, foundering on the shoals of skyrocketing costs – even as they have profited the big private insurers and Big Pharma.

The Supreme Court’s ruling is not expected until June. Regardless of how it rules, we cannot wait for an effective remedy to our health care woes any longer, nor can our patients. The stakes are too high.

We pledge to continue our work for the only equitable, financially responsible and humane cure for our health care mess: single-payer national health insurance, an expanded and improved Medicare for all.

******

Background

Statement of Physicians for a National Health Program upon the passage of the health law in March 2010. Fact sheet on the crisis in U.S. health care and the case for single-payer health reform. A recent analysis of the Massachusetts health reform.

*******
Physicians for a National Health Program (www.pnhp.org) is an organization of more than 18,000 doctors who support single-payer national health insurance. To speak with a physician/spokesperson in your area, visit www.pnhp.org/stateactions or call (312) 782-6006.

PNHP statement on the Supreme Court deliberation of the Affordable Care Act

Health law, constitutional or no, fails to remedy ailment: doctors group

Press Release, March 26, 2012
Leaders of Physicians for a National Health Program, an organization of 18,000 doctors who advocate for single-payer national health insurance, released the following statement today:
Regardless of whether the Supreme Court upholds or overturns the Affordable Care Act in whole or in part, the unfortunate reality is that federal health law of 2010 will not work: (1) it will not achieve universal coverage, as it leaves at least 26 million uninsured, (2) it will not make health care affordable to Americans with insurance, because gaps in their policies will leave them vulnerable to bankruptcy in the event of major illness, and (3) it will not control costs.
Why? Because the ACA perpetuates a dominant role for the private insurance industry. That industry siphons off hundreds of billions of health care dollars annually for overhead, profit and the paperwork it demands from doctors and hospitals; it denies care in order to increase insurers’ bottom line; and it obstructs any serious effort to control costs.
In contrast, a single-payer, improved-Medicare-for-all system would achieve all three goals – truly universal, comprehensive coverage; health security for our patients and their families; and cost control. It would do so by replacing private insurers with a single, nonprofit agency like Medicare that pays all medical bills, streamlines administration, and reins in costs for medications and other supplies through its bargaining clout.
The major provisions of the ACA do not go into effect until 2014. Although we will be counseled to “wait and see” how this reform plays out, we’ve seen how comparable reforms in Massachusetts and other states have worked over the past few decades. They have invariably failed our patients, foundering on the shoals of skyrocketing costs – even as they have profited the big private insurers and Big Pharma.
The Supreme Court’s ruling is not expected until June. Regardless of how it rules, we cannot wait for an effective remedy to our health care woes any longer, nor can our patients. The stakes are too high.
We pledge to continue our work for the only equitable, financially responsible and humane cure for our health care mess: single-payer national health insurance, an expanded and improved Medicare for all.
https://pnhp.org/news/2012/march/health-law-constitutional-or-no-fails-to-remedy-ailment-doctors-group

The attention to the Supreme Court deliberations on the Affordable Care Act is an unfortunate distraction since, regardless of the outcome, intolerable levels of uninsurance, undersinsurance, and unaffordability will still be with us. We need to replace the Affordable Care Act with single-payer national health insurance, an expanded and improved Medicare for all.
Please share this pivotal message with others, and feel free to use it as a basis for other communications such as letters to the editor, op-eds, reports to community organizations, and any other modality that can educate others on this crucial issue.
Other resources:
PNHP statement on the passage of the Affordable Care Act (March 2010):
https://pnhp.org/news/2010/march/pro-single-payer-doctors-health-bill-leaves-23-million-uninsured
Fact sheet on single payer, improved Medicare for all:
https://pnhp.org/system/assets/drupal/docs/2011/Improved-Medicare-for-All-Fact-Sheet.pdf
Many other resources are available at www.pnhp.org

Single Payer and the Supreme Court

Surprisingly, several groups seek to challenge the Affordable Care Act from the left

By Robert Kuttner
The American Prospect, March 23, 2012

When the Supreme Court begins its extraordinary three days of hearings on the constitutionality of the Affordable Care Act, one of the oddities will be an amicus brief challenging the act’s individual mandate from 50 doctors who support national health insurance. They point out the inconvenient truth that, contrary to the administration’s representations, the government did not need to require citizens to purchase insurance from private companies in order to meet its goals of serving the health-care needs of the populace. Congress could have enacted a single-payer law.

Since the Constitution unambiguously gives Congress the power to tax, there has never been a serious constitutional challenge to our tax-supported systems of health insurance, Medicare, and the services of the Veterans Health Administration system. In the words of the brief:

“Amici thus submit this brief for the purpose of disputing the primary tenet of the Government’s position, that Congress cannot regulate the national healthcare market effectively unless it has power to require that citizens purchase insurance from private insurance companies. On the contrary, as set forth herein, Congress has already demonstrated that it can regulate healthcare markets effectively by implementing a single payer system such as Medicare or the VHA.”

Much of the brief is devoted to demonstrating the superior efficiencies of single-payer systems, but it is also offers a formidable summary of the constitutional argument against the government’s view of what the Commerce Clause permits.

“Government contends that the provision is not only ‘reasonable’ but also ‘necessary’ to its broader regulation of the national healthcare market. Brief for Petitioners. In particular, the Government contends that the individual mandate is ‘key to the viability of the Act’s guaranteed-issue and community-rating provisions.’ But while it might be true that these provisions will adversely impact private insurers’ profits, and that the individual mandate offsets this adverse impact by guaranteeing the private insurers a large stream of new customers who are required by law to purchase insurance, that is not sufficient to render the individual mandate constitutional. If it were, Congress could ‘reform’ any private industry – whether it be automobiles, coal, pharmaceuticals or any other – by enacting legislation requiring every that American purchase the industry’s goods or services in exchange for some perceived public good the industry provides. Yet Congress has never before enacted such a mandate.”

Ouch.

The brief further contends that none of the cases cited by the government “support the conclusion that the commerce power permits Congress to enact any regulation it finds necessary to the viability of a larger scheme regulating interstate commerce.”

It would be more than a little ironic if a majority of the Court struck down the Affordable Care Act by relying on these arguments. These points have been made by others, of course. But what’s nervy is that some single-payer advocates are tactically allying themselves with the political right in a momentous Supreme Court battle.

The brief is filed in the name of two groups, Single Payer Action and It’s Our Economy, and was written by attorney Oliver Hall. It explicitly asks the Court to uphold the ruling of the Court of Appeals for the Eleventh Circuit finding the individual mandate unconstitutional.

This tactic must have given some single-payer advocates pause, since the most prominent single-payer group, Physicians for a National Health Program (PNHP) and such noted proponents of national health insurance as Drs. David Himmelstein and Steffie Woolhandler of Physicians for a National Health Program are not on the brief.

If the Affordable Care Act were to be struck down, it would be a political blow to the Obama administration, as well as another case of overreach by the Roberts Court.

But the Court could well uphold the act. Some observers have suggested that the conservatives on the Court are having second thoughts about the unintended consequences of the Citizens United decision on unlimited political giving. Justices Scalia and Kennedy, moreover, have gone both ways on prior cases involving the reach of the commerce clause and may decide that this is not the time to further risk the Court as an institution, which severely impaired its credibility in Bush v. Gore.

On the other hand, if the Court struck down only the individual mandate, the rest of the act would live on. And the administration and Congress would have to find other ways to prevent uninsured people from free-riding on the system. As my colleague Paul Starr has proposed, a Court finding that the mandate was illegal would not necessarily kill the whole law. Other incentives and disincentives could be created so that most people would find it attractive to purchase insurance.

The amici have a point. A single-payer program would be more efficient and unambiguously constitutional, and even the Affordable Care Act need not be such a gravy train for the insurance industry. This brief, though risky, could turn out to be constructive mischief.

http://prospect.org/article/single-payer-and-supreme-court

Insurers promoting phony "self-insured" plans for small employers

California seeks limits on small-business self-insurance trend

By Chad Terhune
Los Angeles Times, March 23, 2012

Self-insurance, in which employers pay medical providers for their workers’ care, has traditionally been used only by large employers that have the financial resources to pay for expensive medical claims.

Now some insurers are chasing after much smaller customers with new plans designed to limit employer payouts for big claims using what’s called stop-loss policies. This guarantees that businesses won’t be responsible for anything over a certain amount per employee, perhaps as low as $10,000 or $20,000, with the rest paid by an insurer. Regulators and health-policy experts say this arrangement undercuts the notion of self-insurance since employers aren’t bearing much of the risk, and it allows companies to circumvent some state insurance rules.

“This is not real self-insurance. This is clearly a sham,” said Mark Hall, a professor of law and public health at Wake Forest University who has studied the small-business insurance market.

Critics said insurers such as Cigna Corp. are using these new plans to game the system and cherry-pick companies with healthier workers. They said this could undermine a key goal of the federal Affordable Care Act to lower premiums by pooling together more healthy and sick Americans into insurance exchanges. Premiums could continue to escalate without a diverse pool of consumers.

Insurance officials say that they are responding to employer demands for more affordable coverage and that regulators shouldn’t interfere in the market.

Self-insurance is attractive for many reasons, particularly the prospect of lower costs. It’s exempt from state insurance regulations such as mandated benefits, granting employers the flexibility to design their own benefit package and the opportunity to reap some of the savings from employee wellness programs. A federal law, the Employee Retirement Income Security Act, or ERISA, governs self-funded plans. Some aspects of the Affordable Care Act do apply to self-insurance, such as the elimination of caps on lifetime benefits and some preventive care at no cost.

Anthem Blue Cross, California’s largest for-profit insurer and a unit of WellPoint Inc., began selling these self-insured plans to employers with as few as 35 workers March 1, down from its previous minimum of 250 employees. Assurant Inc., a New York-based insurer, is selling plans to companies in California and other states with as few as 10 workers.

Marc Neely, vice president for Cigna’s self-insured business in 14 Western states, said his sales to small businesses with as few as 25 people are growing at a double-digit rate because employers are fed up with annual rate hikes of 10% to 15% on their traditional plans. Neely said Cigna offers stop-loss coverage as low as $20,000 per employee. “We’re excited about California as a growth market for us,” Neely said.

http://www.latimes.com/business/la-fi-small-business-insure-20120323,0,4149546.story

Comment:

By Don McCanne, MD

Now that the Affordable Care Act (ACA) is law, we can be assured the the private insurers will be team players in helping to craft regulated insurance markets that will serve the interests of patients first. Right? Wrong! Just read this article about how they are dumping much of the risk onto employers through these phony “self-insured” plans, while using ERISA to escape some of the regulatory provisions of ACA.

These crooks will never change. It is in their corporate DNA. No matter how much they are regulated, they will always find a way around to cheat the payers and avoid paying for the sick. This is what insurance market innovation is all about – screw the patients and take the money and run.

(For more, this topic was covered in a previous message: https://pnhp.org/news/2011/november/exemptions-for-self-insured-plans-place-employees-at-risk)

Insurers promoting phony “self-insured” plans for small employers

California seeks limits on small-business self-insurance trend

By Chad Terhune
Los Angeles Times, March 23, 2012

Self-insurance, in which employers pay medical providers for their workers’ care, has traditionally been used only by large employers that have the financial resources to pay for expensive medical claims.

Now some insurers are chasing after much smaller customers with new plans designed to limit employer payouts for big claims using what’s called stop-loss policies. This guarantees that businesses won’t be responsible for anything over a certain amount per employee, perhaps as low as $10,000 or $20,000, with the rest paid by an insurer. Regulators and health-policy experts say this arrangement undercuts the notion of self-insurance since employers aren’t bearing much of the risk, and it allows companies to circumvent some state insurance rules.

“This is not real self-insurance. This is clearly a sham,” said Mark Hall, a professor of law and public health at Wake Forest University who has studied the small-business insurance market.

Critics said insurers such as Cigna Corp. are using these new plans to game the system and cherry-pick companies with healthier workers. They said this could undermine a key goal of the federal Affordable Care Act to lower premiums by pooling together more healthy and sick Americans into insurance exchanges. Premiums could continue to escalate without a diverse pool of consumers.

Insurance officials say that they are responding to employer demands for more affordable coverage and that regulators shouldn’t interfere in the market.

Self-insurance is attractive for many reasons, particularly the prospect of lower costs. It’s exempt from state insurance regulations such as mandated benefits, granting employers the flexibility to design their own benefit package and the opportunity to reap some of the savings from employee wellness programs. A federal law, the Employee Retirement Income Security Act, or ERISA, governs self-funded plans. Some aspects of the Affordable Care Act do apply to self-insurance, such as the elimination of caps on lifetime benefits and some preventive care at no cost.

Anthem Blue Cross, California’s largest for-profit insurer and a unit of WellPoint Inc., began selling these self-insured plans to employers with as few as 35 workers March 1, down from its previous minimum of 250 employees. Assurant Inc., a New York-based insurer, is selling plans to companies in California and other states with as few as 10 workers.

Marc Neely, vice president for Cigna’s self-insured business in 14 Western states, said his sales to small businesses with as few as 25 people are growing at a double-digit rate because employers are fed up with annual rate hikes of 10% to 15% on their traditional plans. Neely said Cigna offers stop-loss coverage as low as $20,000 per employee. “We’re excited about California as a growth market for us,” Neely said.

http://www.latimes.com/business/la-fi-small-business-insure-20120323,0,4149546.story

Comment:

By Don McCanne, MD

Now that the Affordable Care Act (ACA) is law, we can be assured the the private insurers will be team players in helping to craft regulated insurance markets that will serve the interests of patients first. Right? Wrong! Just read this article about how they are dumping much of the risk onto employers through these phony “self-insured” plans, while using ERISA to escape some of the regulatory provisions of ACA.

These crooks will never change. It is in their corporate DNA. No matter how much they are regulated, they will always find a way around to cheat the payers and avoid paying for the sick. This is what insurance market innovation is all about – screw the patients and take the money and run.

(For more, this topic was covered in a previous message: https://www.pnhp.org/news/2011/november/exemptions-for-self-insured-plans-place-employees-at-risk)

Georgia cost-control bill means well, but is naive

By Jack Bernard
Atlanta Journal-Constitution, March 22, 2012

Co-sponsored by Rep. Paul Broun of Athens, the bill is a well-meaning but naive and misguided attempt to control state and federal expenditures.

It is similar to Rep. Paul Ryan’s plan for radical Medicare reform through vouchers, legislation passed by the House last year and soundly rejected by the Senate.

Controlling Medicaid expenses is clearly needed for national deficit reduction, and to lessen the fiscal burden on states like ours. From 2006 to 2009, Georgia Medicaid expenditures rose from $3.9 billion to $5.6 billion. However, balancing the budget on the backs of 2 million of Georgia’s poorest residents by cutting the care they receive (which is what will happen) is not the way to go.

A much better, more comprehensive solution is to do away with both Medicaid and the Affordable Care Act (i.e., Obamacare) by expanding Medicare to cover all ages and people, including national elected officials. With Universal Medicare all costs can be controlled and complete access assured. Medicare has overhead expenses of about 3 percent, one-tenth of the overhead costs of private insurers. Further, one part of the ACA that should be kept is the Medicare Independent Payment Advisory Board, set up to make sure that costs do not escalate.

Under Universal Medicare, the savings can be spent reimbursing doctors and other providers for direct care, taking care of sick people, versus buying second homes and yachts for insurance company CEOs who are making millions of dollars each year in bonuses, stock options and ridiculous salaries.

Medicare is one of the few programs that taxpayers enthusiastically support, even many of the tea party’s gray panthers. It is hard for anyone to attack a program almost everyone understands and generally likes. In other words, if Medicare is good enough for granny, then it’s good enough for me and my congressman. Now, that is a political slogan that Joe Sixpack can get behind.

Medicare must be responsive to the voters because it is a publicly funded program authorized by our elected representatives. Who elects the CEOs of health insurance companies? What real power does the individual policy holder have when denied a claim (otherwise known as rationing)? Almost none.

The benefits of Medicare for all, as well as costs relative to existing private programs, have been established by a national group, Physicians for a National Health Program. (Their website — www.pnhp.org — contains information on single payer systems.)

Unfortunately, PNHP and other progressive groups were virtually shut out of the political process when reform was discussed in Washington in 2009. The insurance lobby was, and still is, one of the strongest in our capital.

Block grants — effectively cutting health care to poor people — are not the answer to our problems. Neither is going backward, dumping the ACA and relying on the “free market” to cure our ills. A recent Gallup survey shows that the insurance problem is getting much worse in our state and the nation. In Georgia, the number of uninsured is increasing rapidly, from 19 percent in 2008 to 22 percent in 2011. That rate is even faster than the U.S. rise from 15 percent to 17 percent. In fact, only five states have a higher rate of uninsured than Georgia. .

A single payer program covering all Americans should have been passed in 2009 — and it will be, in future years when the true financial and human costs of misguided reforms like the ACA, Medicaid block grants and Medicare vouchers are clear.

Jack Bernard, a senior health care executive for 25 years, serves on the Jasper County Board of Commissioners.

http://www.ajc.com/opinion/bill-means-well-but-1395148.html

Occupy Health Care? Will 'Medicare for all' catch fire?

Maybe ‘Medicare for All’ can catch fire as a populist slogan

By James Hill and Samuel Levey
Iowa City Press-Citizen, March 22, 2012

Even as voices from the Occupy Wall Street movement have faded in recent months, the conversations they started continue. Wall Street greed, corporate recklessness and growing economic inequality are still in the news and still being talked about — along with other grievances caught up in the movement’s wide net.

Problems in the health care sector are among them; many can be found posted on websites along with demands for change, often under a banner of “Occupy Health Care.”

No doubt the U.S. health care system is a worthy offender and deserves such attention. Consider the massive out-of-control spending ($2.6 trillion in 2010, more than 16 percent of GDP), the glaring inefficiencies, the stubbornly high number of medical errors and the persistent waste, fraud and abuse.

Of these, the offense that ought to merit a storm of protest is the ever-climbing cost of health care. In 2011, the national bill for health care increased by 4.5 percent, health insurance premiums rose by 9 percent, and the average cost of employer-provided coverage for a family exceeded $15,000. Today costs continue on an upward spiral of national spending.

Some supporters of President Obama’s Affordable Care Act of 2010 believe the legislation will be able to “bend the curve” of spending when fully implemented, as it is intended to do, by reducing costs over the long term.

And it’s true that restructuring the delivery of health care could have a notable effect on cost. As economist David Cutler notes, “The potential savings from delivery system reform are enormous. … (Given enough time,) 30 percent of annual medical spending — nearly $2,300 per person — could be eliminated without any adverse health consequence.”

But much skepticism remains. Many strong supporters of health care reform who rallied behind Obama’s early efforts now doubt the ACA will halt the inexorable rise in health care cost.

Former New England Journal of Medicine editor Arnold Relman asks, “If neither party is proposing effective solutions to the cost crisis and political deadlock in Washington is preventing the consideration of new ideas, are we doomed to witness a slowly collapsing health care system that eventually will provide adequate care only to those who can afford to pay?”

Other critics take a similarly dim view of the Affordable Care Act’s prospects for cost control. For physicians Steffie Woolhandler and David Himmelstein, the blame is not in political gridlock but the enormous influence of corporations, from health insurers to pharmaceutical companies, in the making of American health care policy.

As long as health care is run as a bottom-line business with financial incentives driving it, they argue, the overtreatment of patients and rising administrative overhead will continue, pushing up overall costs.

While Relman finds encouraging possibilities for cost-control in the trend toward multispecialty group practices and salaried physicians, he remains a firm believer in the superior virtues of the program Congress once again failed to pass: comprehensive national health insurance.

Like Woolhandler and Himmelstein, Relman favors universal coverage under a single-payer, taxpayer-supported public system. Under this system, advocates argue, the bedeviling problems of patient overtreatment and excessive administrative costs can be brought under control via prepaid comprehensive care while health care insurance is extended to all Americans — features not possible under the act.

The response of such single-payer stalwarts to the achievement of Affordable Care Act is tepid support at best. And in the minds of many liberal reform advocates, the act is inadequate health care legislation, not something to celebrate and feel good about.

Perhaps that dissatisfaction is now working its way into a new health care rhetoric that appears to align itself somewhat with the rhetoric of the Occupy movement. Starr, himself an admitted “strong reformer,” describes the ideological/class lines on which health care in American has been fought over its history, then wonders if the “special interests were arrayed on one side and the suffering masses on the other, the conflict would fit easily into a familiar populist picture of the world.”

A populist picture is perhaps what Woolhandler and Himmelstein have in mind. America is now divided on the issue of health care financing, they argue, and “while the American people want an expanded and improved Medicare for All — that is a single-payer system — corporations dead set against single-payer reform have come to dictate the agendas of both political parties. Hence, the only way to win national health insurance is to build a popular movement to counter corporate power.”

If “Medicare for All” can catch fire as a populist slogan, just as “Occupy Wall Street” did in 2011, under the force of widening economic and political divisions, perhaps a full-blown Occupy Health Care movement will emerge.

For that to happen, however — for reformers to have more than a scattering of websites to show for their efforts — the movement will need something more to move it forward: a visible groundswell of discontent.

Jim Hill is a writer who lives in Coralville. Samuel Levey is a professor in the Department of Health Management and Policy in the University of Iowa College of Public Health.

http://www.press-citizen.com/article/20120322/OPINION02/303220043/Occupy-Health-Care-?odyssey=nav|head

Occupy Health Care? Will ‘Medicare for all’ catch fire?

Maybe ‘Medicare for All’ can catch fire as a populist slogan

By James Hill and Samuel Levey
Iowa City Press-Citizen, March 22, 2012

Even as voices from the Occupy Wall Street movement have faded in recent months, the conversations they started continue. Wall Street greed, corporate recklessness and growing economic inequality are still in the news and still being talked about — along with other grievances caught up in the movement’s wide net.

Problems in the health care sector are among them; many can be found posted on websites along with demands for change, often under a banner of “Occupy Health Care.”

No doubt the U.S. health care system is a worthy offender and deserves such attention. Consider the massive out-of-control spending ($2.6 trillion in 2010, more than 16 percent of GDP), the glaring inefficiencies, the stubbornly high number of medical errors and the persistent waste, fraud and abuse.

Of these, the offense that ought to merit a storm of protest is the ever-climbing cost of health care. In 2011, the national bill for health care increased by 4.5 percent, health insurance premiums rose by 9 percent, and the average cost of employer-provided coverage for a family exceeded $15,000. Today costs continue on an upward spiral of national spending.

Some supporters of President Obama’s Affordable Care Act of 2010 believe the legislation will be able to “bend the curve” of spending when fully implemented, as it is intended to do, by reducing costs over the long term.

And it’s true that restructuring the delivery of health care could have a notable effect on cost. As economist David Cutler notes, “The potential savings from delivery system reform are enormous. … (Given enough time,) 30 percent of annual medical spending — nearly $2,300 per person — could be eliminated without any adverse health consequence.”

But much skepticism remains. Many strong supporters of health care reform who rallied behind Obama’s early efforts now doubt the ACA will halt the inexorable rise in health care cost.

Former New England Journal of Medicine editor Arnold Relman asks, “If neither party is proposing effective solutions to the cost crisis and political deadlock in Washington is preventing the consideration of new ideas, are we doomed to witness a slowly collapsing health care system that eventually will provide adequate care only to those who can afford to pay?”

Other critics take a similarly dim view of the Affordable Care Act’s prospects for cost control. For physicians Steffie Woolhandler and David Himmelstein, the blame is not in political gridlock but the enormous influence of corporations, from health insurers to pharmaceutical companies, in the making of American health care policy.

As long as health care is run as a bottom-line business with financial incentives driving it, they argue, the overtreatment of patients and rising administrative overhead will continue, pushing up overall costs.

While Relman finds encouraging possibilities for cost-control in the trend toward multispecialty group practices and salaried physicians, he remains a firm believer in the superior virtues of the program Congress once again failed to pass: comprehensive national health insurance.

Like Woolhandler and Himmelstein, Relman favors universal coverage under a single-payer, taxpayer-supported public system. Under this system, advocates argue, the bedeviling problems of patient overtreatment and excessive administrative costs can be brought under control via prepaid comprehensive care while health care insurance is extended to all Americans — features not possible under the act.

The response of such single-payer stalwarts to the achievement of Affordable Care Act is tepid support at best. And in the minds of many liberal reform advocates, the act is inadequate health care legislation, not something to celebrate and feel good about.

Perhaps that dissatisfaction is now working its way into a new health care rhetoric that appears to align itself somewhat with the rhetoric of the Occupy movement. Starr, himself an admitted “strong reformer,” describes the ideological/class lines on which health care in American has been fought over its history, then wonders if the “special interests were arrayed on one side and the suffering masses on the other, the conflict would fit easily into a familiar populist picture of the world.”

A populist picture is perhaps what Woolhandler and Himmelstein have in mind. America is now divided on the issue of health care financing, they argue, and “while the American people want an expanded and improved Medicare for All — that is a single-payer system — corporations dead set against single-payer reform have come to dictate the agendas of both political parties. Hence, the only way to win national health insurance is to build a popular movement to counter corporate power.”

If “Medicare for All” can catch fire as a populist slogan, just as “Occupy Wall Street” did in 2011, under the force of widening economic and political divisions, perhaps a full-blown Occupy Health Care movement will emerge.

For that to happen, however — for reformers to have more than a scattering of websites to show for their efforts — the movement will need something more to move it forward: a visible groundswell of discontent.

Jim Hill is a writer who lives in Coralville. Samuel Levey is a professor in the Department of Health Management and Policy in the University of Iowa College of Public Health.

http://www.press-citizen.com/article/20120322/OPINION02/303220043/Occupy-Health-Care-?odyssey=nav|head

Insurers promoting phony "self-insured" plans for small employers

California seeks limits on small-business self-insurance trend

By Chad Terhune
Los Angeles Times, March 23, 2012
Self-insurance, in which employers pay medical providers for their workers’ care, has traditionally been used only by large employers that have the financial resources to pay for expensive medical claims.
Now some insurers are chasing after much smaller customers with new plans designed to limit employer payouts for big claims using what’s called stop-loss policies. This guarantees that businesses won’t be responsible for anything over a certain amount per employee, perhaps as low as $10,000 or $20,000, with the rest paid by an insurer. Regulators and health-policy experts say this arrangement undercuts the notion of self-insurance since employers aren’t bearing much of the risk, and it allows companies to circumvent some state insurance rules.
“This is not real self-insurance. This is clearly a sham,” said Mark Hall, a professor of law and public health at Wake Forest University who has studied the small-business insurance market.
Critics said insurers such as Cigna Corp. are using these new plans to game the system and cherry-pick companies with healthier workers. They said this could undermine a key goal of the federal Affordable Care Act to lower premiums by pooling together more healthy and sick Americans into insurance exchanges. Premiums could continue to escalate without a diverse pool of consumers.
Insurance officials say that they are responding to employer demands for more affordable coverage and that regulators shouldn’t interfere in the market.
Self-insurance is attractive for many reasons, particularly the prospect of lower costs. It’s exempt from state insurance regulations such as mandated benefits, granting employers the flexibility to design their own benefit package and the opportunity to reap some of the savings from employee wellness programs. A federal law, the Employee Retirement Income Security Act, or ERISA, governs self-funded plans. Some aspects of the Affordable Care Act do apply to self-insurance, such as the elimination of caps on lifetime benefits and some preventive care at no cost.
Anthem Blue Cross, California’s largest for-profit insurer and a unit of WellPoint Inc., began selling these self-insured plans to employers with as few as 35 workers March 1, down from its previous minimum of 250 employees. Assurant Inc., a New York-based insurer, is selling plans to companies in California and other states with as few as 10 workers.
Marc Neely, vice president for Cigna’s self-insured business in 14 Western states, said his sales to small businesses with as few as 25 people are growing at a double-digit rate because employers are fed up with annual rate hikes of 10% to 15% on their traditional plans. Neely said Cigna offers stop-loss coverage as low as $20,000 per employee. “We’re excited about California as a growth market for us,” Neely said.
http://www.latimes.com/business/la-fi-small-business-insure-20120323,0,4…

Now that the Affordable Care Act (ACA) is law, we can be assured the the private insurers will be team players in helping to craft regulated insurance markets that will serve the interests of patients first. Right? Wrong! Just read this article about how they are dumping much of the risk onto employers through these phony “self-insured” plans, while using ERISA to escape some of the regulatory provisions of ACA.
These crooks will never change. It is in their corporate DNA. No matter how much they are regulated, they will always find a way around to cheat the payers and avoid paying for the sick. This is what insurance market innovation is all about – screw the patients and take the money and run.
(For more, this topic was covered in a previous message: https://pnhp.org/news/2011/november/exemptions-for-self-insured-plans…)

Controlling costs through HHS rate reviews

2012 Progress Report: Health Reform is Opening the Insurance Market and Protecting Consumers

HealthCare.gov, March 22, 2012

The Affordable Care Act’s Rate Review policies bring an unprecedented level of scrutiny and transparency to health insurance rate increases.  They ensure that, in every state, every proposed increase of 10% or more is evaluated by independent experts to assess whether they are based on reasonable assumptions and sound data.

Rate review is expected to help moderate premium increases and provide consumers with greater value for their premium dollar. Additionally, health insurance companies must provide easy to understand information to their customers about their reasons for significant rate increases, as well as publicly justify and post on their website any unreasonable rate increases.

The Affordable Care Act’s Rate Review program started for most individual and small group plans on September 1, 2011.

Through March 10, 2012, 186 increases affecting more than 1.3 million people have been posted on companyprofiles.healthcare.gov.  Each provides an explanation from the insurer, including the rate increases determined to be unreasonable rate increases.

States are taking a strong lead in reviewing proposed rate increases.  Of the 186 requested increases posted on HealthCare.gov as of March 10, 2012, two-thirds (125 filings) of these are being reviewed by rate review programs in the states. Only one-third (61 filings) is under review by HHS.

In the 61 instances to date where HHS is charged with conducting reviews, the Department has completed 28 determinations.  HHS has determined that 20 of the 28 proposed rate increases are unreasonable.  The most common reason for this determination is that the proposal would result in projected medical loss ratios (MLRs) below the 80% applicable threshold.

http://www.healthcare.gov/law/resources/reports/rate-review03222012a.html

Comment: 

By Don McCanne, MD

The title of today’s message, “Controlling costs through HHS rate reviews,” is deliberately deceptive to make a point. Supposedly, the Affordable Care Act (ACA) was designed to help control spending in health care, and the insurance premium Rate Review process was a component of cost containment. In fact, not only does the process have no impact on health care spending, it doesn’t even have any federal control over increases in health insurance premiums.

ACA regulations require that any plan with premium increases of 10 percent or more be reviewed. Although states may have some influence over rate increases, the federal government has no authority to do anything about the increases other than expose the insurers to public ridicule.

In the last six months, 20 rate increases reviewed by the federal government have been found to be unreasonable, primarily because they exceeded the 20 percent of the premium that they could use for administrative services and profits. Many of these insurers in the individual market will find that their inefficiencies are so great that they will be unable to comply with this requirement, so they really don’t need ridicule to drive home this point.

In the meantime, insurers will be able to increase their premiums 9.9 percent each year with no questions asked, at least not by the federal government. Compound that rate over several years, and then where will we be?

Obviously this ACA measure to “control costs” will have very little impact, if any, on insurance premiums and absolutely no impact on total health care spending.

There is a much more efficient model of health care financing that actually would slow the increase in health care spending while ensuring health care for everyone. Instead of playing ACA games, we should move forward with an improved Medicare for everyone.

Spin Doctors in Vermont

An industry defector warns of outside influence in the single-payer debate

By Kathryn Flagg
Seven Days (Burlington, Vt.), March 21, 2012

Maybe you’ve seen the commercial. It debuted on Vermont airwaves last month, and the message goes something like this:

“Governor Peter Shumlin and the Democratic majorities in Montpelier want to completely uproot our health care system and spend more than $5 billion on a single-payer health care scheme,” says a middle-aged woman sitting down to tea in her kitchen. She looks exasperated and extremely skeptical. She tells viewers that no one knows where the money will come from or what the benefits will look like, and that elected officials won’t have any answers until after the next election.

“It’s not fair and it’s not right,” she says, then adds, “They’re hiding something. They’re not giving us any reason to trust them.”

The ad was paid for by a group called Vermonters for Health Care Freedom — and Wendell Potter predicted exactly this kind of publicity. It’s indicative, he says, of the kind of tactics the insurance industry will roll out in the coming months and years to counteract the forward march of single-payer health care in Vermont.

Potter knows those tactics well: He’s a longtime insider who defected from a high-ranking, high-paying public relations job to draw back the curtain on the health insurance industry. Based in Philadelphia, he is closely watching Vermont and testified last year before its legislators. Now Potter warns that the state will be a frontline battleground for single-payer health care in the U.S., and that the insurance industry — with its profits at stake — is sure to have a hand in the debate.

“The insurance industry is very afraid that [if Vermont succeeds] … other states will pay attention,” Potter says. That includes much larger states, such as California, where a single-payer bill stalled out in the state senate last month.

Vermont led the nation last year when it passed legislation to establish the country’s first single-payer health care plan. Proponents say it will cut care costs while providing universal insurance, but opponents such as Vermonters for Health Care Freedom say the system could raise taxes, chase off employers and limit health care choices.

Under current federal rules, the state can’t enact that plan until 2017. Potter and local single-payer advocates say the delay gives opponents time to mobilize.

“What I’m seeing right now is that they’re having their shills, the people they’re influencing, try to raise doubts about how the state will pay for universal coverage and what will happen to taxes,” Potter says. “They’ll try to … get Vermonters to second-guess themselves.”

Potter would know: Not long ago, he was on the inside. He began his career as a newspaper reporter, then, like many journalists, made the switch to public-relations work. He spent the bulk of his PR days at Cigna, where he climbed the corporate ladder and eventually ended up about as close to the top as a public-relations executive can be, he says.

“I spent a lot of time trying to mislead people,” says Potter, though in the early days, he notes, he himself was a believer. He joined Cigna in the early 1990s at the advent of “managed care,” an approach the industry hoped would bring down costs while providing coverage to more people. During the heyday of managed-care plans, Potter says, that worked relatively well.

But slowly the industry changed. Companies began focusing on what they called “consumer-driven care” and shifting more and more customers to high-deductible plans. Potter calls these customers the “underinsured”: They’re technically covered, but their deductibles are so high — often thousands of dollars each year — that they can’t afford much care, or must go into debt to obtain it. Part of Potter’s job was making people think these plans were a good solution to the problems of providing health care in America, yet he grew increasingly doubtful.

“I was trying to sell people snake oil, to tell you the truth,” he says.

Potter is soft spoken, and the twang in his voice reflects his Southern upbringing. It was during a trip back to the South, in 2007, that he had what he now calls his “epiphany.” Potter tagged along to watch a Knoxville, Tenn.-based nonprofit dole out medical care at county fairgrounds in Virginia. That nonprofit, Remote Area Medical, has tended to patients in developing countries, but its leaders found that people closer to home desperately needed attention, too.

With RAM, Potter drove the 50-odd miles from Tennessee to the Wise County, Va., fairgrounds, where he watched thousands of patients queue up to see doctors and nurses ensconced in animal stalls-turned-makeshift clinics. Though he’d been having doubts about his career for some time, he says that experience opened his eyes.

“What I was doing for a living was in some way making it necessary for people to get care that way, in an undignified, dehumanizing way,” Potter says.

Potter quit his job in 2008, a few months after he worked on a white paper to persuade legislators that the problem of uninsured citizens in the United States wasn’t a problem at all. By the time he left Cigna, he was convinced of exactly the opposite. These days, Potter supports single-payer health care as a way to provide quality care while cutting costs.

Surprisingly, Potter hasn’t experienced any backlash from the insurance industry, which he says he’s seen effectively silence or discredit critics in the past. What he has experienced, though, is a flood of emails from former coworkers and others still in the insurance world — often writing from private accounts — thanking him for the work he does. Potter has returned to his roots as a reporter and now writes news-analysis columns for the Center for Public Integrity. He’s also published a book, “Deadly Spin: An Insurance Company Insider Speaks Out on How Corporate PR is Killing Health Care and Deceiving Americans.”

While Potter says the insurance industry itself may never be especially visible in Vermont, he predicts it will funnel in money through groups such as the National Federation of Independent Business and the U.S. Chamber of Commerce. He expects a “fear-mongering” campaign to unfold over time.

“It will be the attempt to kill [single payer] by a thousand cuts over the months to come,” Potter says.

He warns Vermont residents to be skeptical of the talking points they’ll hear on the topic of single-payer health care, to question motives and to look at the sources of the information provided.

“I encourage Vermonters to seek out the truth and keep their eyes on really transforming the health care system here,” Potter says. “Vermont can lead the country toward a more rational and equitable health care system.”

Local proponents of a single-payer system are well aware that the fight isn’t over. Ellen Oxfeld is a longtime advocate, one of the leaders of Vermont Health Care for All. She says she’s particularly concerned about the influence of outside money on the health care debate in the state. She points out that Vermont is a small market where ad time isn’t that expensive.

“They have more money, and they have time,” Oxfeld says of her opponents. “But I think what’s on our side is that the present system is unsustainable, and people’s own experiences are showing them that.”

Peggy Carey agrees. Carey is a doctor and chair of the Vermont chapter of Physicians for a National Health Program. She says the tactics of which Potter warns are already in play in the state, and it’s going to take a continuous response from activists to counter those attacks. But she also thinks Vermont is fortunate enough to
have residents who want to hear both sides of the argument and make informed decisions.

“I think they’re pretty good about overlooking special-interest folks and the spin-meisters that are out there,” Carey says.

But who is doing the spinning? Potter says it’s likely organizations funded or in some other way backed by for-profit insurers, though tracking the funding behind voices in the unfolding health care debate may be impossible.

Vermonters for Health Care Freedom, for example, is a 501(c)(4) — in other words, a nonprofit devoted primarily to social welfare. That means the group doesn’t have to disclose its donors or sources of funding. Groups with that tax designation include major nonprofits, such as the National Rifle Association and AARP, some of which are also major political spenders. Tax law says these groups can’t promote individual candidates but can promote causes, and they may do unlimited lobbying on issues related to a cause.

Darcie Johnston, a Burlington consultant, founded VHCF, which aired some radio ads last year before unveiling its first television spot last month. Johnston headed the group until VHCF hired its executive director, Jeffery Wennberg. Johnston says her motivation is to educate Vermonters about the possible economic and health care impacts of Green Mountain Care, the state’s proposed single-payer system.

Though she’s squarely at odds with activists Oxfeld, Carey and Potter, Johnston does agree with them on one count: She predicts Vermont will soon be the focus of attention from individuals, companies and interest groups around the country.

“We’re lab rats,” she says.

http://www.7dvt.com/2012spin-doctors

Controlling costs through HHS rate reviews

2012 Progress Report: Health Reform is Opening the Insurance Market and Protecting Consumers

HealthCare.gov, March 22, 2012
The Affordable Care Act’s Rate Review policies bring an unprecedented level of scrutiny and transparency to health insurance rate increases.  They ensure that, in every state, every proposed increase of 10% or more is evaluated by independent experts to assess whether they are based on reasonable assumptions and sound data.
Rate review is expected to help moderate premium increases and provide consumers with greater value for their premium dollar. Additionally, health insurance companies must provide easy to understand information to their customers about their reasons for significant rate increases, as well as publicly justify and post on their website any unreasonable rate increases.
The Affordable Care Act’s Rate Review program started for most individual and small group plans on September 1, 2011.
Through March 10, 2012, 186 increases affecting more than 1.3 million people have been posted on companyprofiles.healthcare.gov.  Each provides an explanation from the insurer, including the rate increases determined to be unreasonable rate increases.
States are taking a strong lead in reviewing proposed rate increases.  Of the 186 requested increases posted on HealthCare.gov as of March 10, 2012, two-thirds (125 filings) of these are being reviewed by rate review programs in the states. Only one-third (61 filings) is under review by HHS.
In the 61 instances to date where HHS is charged with conducting reviews, the Department has completed 28 determinations.  HHS has determined that 20 of the 28 proposed rate increases are unreasonable.  The most common reason for this determination is that the proposal would result in projected medical loss ratios (MLRs) below the 80% applicable threshold.
http://www.healthcare.gov/law/resources/reports/rate-review03222012a.html

The title of today’s message, “Controlling costs through HHS rate reviews,” is deliberately deceptive to make a point. Supposedly, the Affordable Care Act (ACA) was designed to help control spending in health care, and the insurance premium Rate Review process was a component of cost containment. In fact, not only does the process have no impact on health care spending, it doesn’t even have any federal control over increases in health insurance premiums.
ACA regulations require that any plan with premium increases of 10 percent or more be reviewed. Although states may have some influence over rate increases, the federal government has no authority to do anything about the increases other than expose the insurers to public ridicule.
In the last six months, 20 rate increases reviewed by the federal government have been found to be unreasonable, primarily because they exceeded the 20 percent of the premium that they could use for administrative services and profits. Many of these insurers in the individual market will find that their inefficiencies are so great that they will be unable to comply with this requirement, so they really don’t need ridicule to drive home this point.
In the meantime, insurers will be able to increase their premiums 9.9 percent each year with no questions asked, at least not by the federal government. Compound that rate over several years, and then where will we be?
Obviously this ACA measure to “control costs” will have very little impact, if any, on insurance premiums and absolutely no impact on total health care spending.
There is a much more efficient model of health care financing that actually would slow the increase in health care spending while ensuring health care for everyone. Instead of playing ACA games, we should move forward with an improved Medicare for everyone.