Most of you are aware of the important role that Deb Richter has played in advancing health care reform in the state of Vermont, where every effort is being made to bring Vermont in compliance with the policies and goals of a single payer system. The road in that direction has been rough and challenging, but that has not stopped the dedicated advocates of reform from moving forward.

Deb Richter is a member of the nominating committee for the Green Mountain Care Board. She has asked me distribute the following notice. Many members of this list either are or know people who are highly qualified to serve on this board. Applicants do not have to be Vermonters.

This is a great opportunity for qualified, dedicated individuals to contribute to these groundbreaking efforts to advance health care justice.

GREEN MOUNTAIN CARE BOARD MEMBER

State of Vermont

The State of Vermont is seeking candidates for the independent, five-member, Green Mountain Care Board that was established by Vermont’s landmark health care health reform law. The Board consists of a full-time Chair and four members.

Vermont’s health care reform law (Act 48, 2011 Session) sets out a process to move the state through several stages of health care system change leading to a publicly financed, universal health benefits program, Green Mountain Care, by 2017. When completed, the program will provide affordable access to high quality health care for all Vermonters, separate from their employment.

Board members will be exempt state employees. The Chair, who will be responsible for leading the process, will be a full time employee and will be paid $122,866. Side members will be .8 FTE (32 hours) and will be paid $81,910. Required qualifications can be found in the job description below. The Governor will make appointments to the Green Mountain Care Board by October 1, 2011 from a list of qualified candidates submitted to him by the Nominating Committee.

How to Apply
To obtain a complete job description, application form and find complete details about the application process, please visit:
http://humanresources.vermont.gov/GMCB_Search

Completed applications must be received no later than 2:00 p.m. on July 11, 2011.

Green Mountain Care Board Member Search:
http://humanresources.vermont.gov/GMCB_Search

Green Mountain Care Board Member Job Description:
http://humanresources.vermont.gov/sites/dhr/files/pdf/GMCB%20Job%20Description.pdf

Application for Candidates for Green Mountain Care Board:
http://humanresources.vermont.gov/sites/dhr/files/pdf/APPLICATION%20FOR%20GMCB%20CANDIDATES.pdf

(Although this is not an official message from PNHP, it is being distributed nevertheless because the Vermont effort represents significant progress towards the goal of achieving health care justice for all – a goal we share with the Vermont organizers. PNHP will continue its mission of advocating for a single payer national health program, without compromise.)

By Kieke G.H. Okma, Ph.D., Theodore R. Marmor, Ph.D., and Jonathan Oberlander, Ph.D
The New England Journal of Medicine, June 15, 2011

Discussions about U.S. health care reform are often parochial, with scant attention paid to other countries’ experiences. It is thus surprising that in the ongoing debate over Medicare, some U.S. commentators have turned to the Netherlands as a model of regulated competition among private insurance companies. The Dutch experience is particularly relevant given the proposal by Congressman Paul Ryan (R-WI) to eliminate traditional Medicare and instead provide beneficiaries with vouchers to purchase private insurance.

It is easy to understand why Dutch health care — which does rely on regulated private insurance — would appeal to advocates of Medicare vouchers. Indeed, U.S. ideas about managed competition helped to shape health care reform in the Netherlands. But careful examination of the Dutch experience shows that insurance competition has not produced the expected benefits and in fact has created new problems, calling into question the merits of this reform model and its suitability for Medicare.

Before 2006, the Netherlands had a mixed health insurance system, with more than 60% of the population covered by mandatory social insurance, administered by nonprofit sick funds. The remaining population had private insurance, voluntarily purchased, and the uninsured rate was about 1.5%.

In 2006, the Netherlands replaced this arrangement with a mandated private insurance system similar to Switzerland’s. Under this reform, all legal residents of the Netherlands are required to purchase basic insurance from private insurers. Private plans are heavily regulated. They cannot turn down applicants, regardless of health status, and must charge community-rated premiums. A risk-equalization scheme varies payment to health plans according to their enrolled populations’ risk profiles. The aim is to reduce plans’ incentives to select profitable patients and ensure that plans with sicker, higher-cost populations are not financially penalized. Insurance plans are expected to compete on the basis of price and quality by selectively contracting with networks of hospitals, physicians, and other medical care providers.

Advocates of this system argued that competition among private insurers would reduce health care spending, enhance consumer choice, and improve the quality of care and the health system’s responsiveness to patients — arguments that are being repeated in the U.S. debate over Medicare. The reality of managed competition in the Netherlands, however, has not matched the rhetoric.

Four key points emerge from the Dutch experience. First, competition has not sharply slowed the rate of growth in health care spending. Health care expenditures continue to outpace general inflation, having increased at an average annual rate of 5% since 2006. At the same time, the total costs of health insurance for Dutch families, including premiums and deductibles, increased by 41%.

Reforms aimed at increasing and managing competition also produced high administrative costs and complexity. Administering premium subsidies for low-income people has proven expensive.

Second, some Dutch people remain uninsured, and there has been a substantial increase in the number of insured persons failing to pay their insurance premiums.

Third, the expansion of consumer choice has not worked as envisioned. Since 2007, only about 4% of the Dutch population, on average, has changed plans each year. Moreover, accelerating consolidation of the health insurance market has restricted meaningful choice of insurance plan. Currently, four insurance conglomerates control about 90% of the Dutch health insurance market. Recent polls suggest public dissatisfaction with private insurers, with 65% of insured people reporting that they have low or very low levels of trust in private plans.

Fourth, notwithstanding the rhetoric of competition, the Netherlands still relies heavily on regulation. Indeed, the Dutch case shows that competitive systems that seek to escape supposedly centralized, bureaucratic control of medical care paradoxically require sophisticated regulation and government intervention in order to work.

The comprehensiveness of health insurance in the Netherlands provides a critical contrast to the Ryan Medicare plan, which would erode the U.S. government’s contribution to the point that 65-year-old beneficiaries would pay about two thirds of medical costs themselves.

The myth that competition has been key to cost containment in the Netherlands has obscured a crucial reality. Health care systems in Europe, Canada, Japan, and beyond, all of which spend much less than the United States on medical services, rely on regulation of prices, coordinated payment, budgets, and in some cases limits on selected expensive medical technologies, to contain health care spending. Systemwide regulation of spending, rather than competition among insurers, is the key to controlling health care costs. The Netherlands, after all, spent much less on medical care than the United States with virtually universal insurance coverage long before it began experimenting with managed competition in 2006.

The Dutch experience provides a cautionary tale about the place of private insurance competition in health care reform. The Dutch reforms have fallen far short of expectations — a reminder that policy intentions should not be confused with outcomes and that managed competition is hardly a panacea. The idea that the Dutch reforms provide a successful model for U.S. Medicare to emulate is bizarre. The Dutch case in fact underscores the pitfalls of the casual use (and misuse) of international experience in U.S. health care reform debates.

http://healthpolicyandreform.nejm.org/?p=14712

Comment: 

By Don McCanne, MD

The authors of this NEJM Perspective on lessons from the Netherlands – Kieke G.H. Okma, Ph.D., Theodore R. Marmor, Ph.D., and Jonathan Oberlander, Ph.D. – are highly credible authorities on comparative studies and the politics of health care reform. The facts they present are well documented, and the conclusion is so obvious that it is essentially a restatement of the facts: “Systemwide regulation of spending, rather than competition among insurers, is the key to controlling health care costs.”

To no surprise, some of the published responses in the NEJM have challenged the credibility of these noted authorities, and instead have chosen to reframe the discussion – presenting “free markets,” “competition” and “consumer choice” as if these were the facts. These critics dismiss the results in the Netherlands because their “managed competition” system failed to use free market principles.

Which is it? Do we adopt Netherlands-style managed competition because it allows private insurers to compete, even though that hasn’t been proven to be of benefit? Or do we reject all existing models and adopt a truly free market wherein patients pay for all health care with their own cash? Of course, that can’t work either because of the necessity of pooling funds, and as soon as you have introduced the insurance function, you have suppressed the “price-based signals” and distorted the market.

Of course, neither of these choices – framed in terms of “markets” – will work. What does work – framed in terms of thoroughly documented studies of functioning health systems – is “regulation of prices, coordinated payment, budgets, and in some cases limits on selected expensive medical technologies.” That requires a major role for government, as the Netherlands is rediscovering.

Although the authors present this as a lesson for Medicare, it is actuall
y a lesson for our entire health care system. Perhaps they anticipate when Medicare will be improved and then expanded to cover everyone. Let’s hope so.

Managed Competition for Medicare? Sobering Lessons from the Netherlands

By Kieke G.H. Okma, Ph.D., Theodore R. Marmor, Ph.D., and Jonathan Oberlander, Ph.D
The New England Journal of Medicine, June 15, 2011

Discussions about U.S. health care reform are often parochial, with scant attention paid to other countries’ experiences. It is thus surprising that in the ongoing debate over Medicare, some U.S. commentators have turned to the Netherlands as a model of regulated competition among private insurance companies. The Dutch experience is particularly relevant given the proposal by Congressman Paul Ryan (R-WI) to eliminate traditional Medicare and instead provide beneficiaries with vouchers to purchase private insurance.

It is easy to understand why Dutch health care — which does rely on regulated private insurance — would appeal to advocates of Medicare vouchers. Indeed, U.S. ideas about managed competition helped to shape health care reform in the Netherlands. But careful examination of the Dutch experience shows that insurance competition has not produced the expected benefits and in fact has created new problems, calling into question the merits of this reform model and its suitability for Medicare.

Before 2006, the Netherlands had a mixed health insurance system, with more than 60% of the population covered by mandatory social insurance, administered by nonprofit sick funds. The remaining population had private insurance, voluntarily purchased, and the uninsured rate was about 1.5%.

In 2006, the Netherlands replaced this arrangement with a mandated private insurance system similar to Switzerland’s. Under this reform, all legal residents of the Netherlands are required to purchase basic insurance from private insurers. Private plans are heavily regulated. They cannot turn down applicants, regardless of health status, and must charge community-rated premiums. A risk-equalization scheme varies payment to health plans according to their enrolled populations’ risk profiles. The aim is to reduce plans’ incentives to select profitable patients and ensure that plans with sicker, higher-cost populations are not financially penalized. Insurance plans are expected to compete on the basis of price and quality by selectively contracting with networks of hospitals, physicians, and other medical care providers.

Advocates of this system argued that competition among private insurers would reduce health care spending, enhance consumer choice, and improve the quality of care and the health system’s responsiveness to patients — arguments that are being repeated in the U.S. debate over Medicare. The reality of managed competition in the Netherlands, however, has not matched the rhetoric.

Four key points emerge from the Dutch experience. First, competition has not sharply slowed the rate of growth in health care spending. Health care expenditures continue to outpace general inflation, having increased at an average annual rate of 5% since 2006. At the same time, the total costs of health insurance for Dutch families, including premiums and deductibles, increased by 41%.

Reforms aimed at increasing and managing competition also produced high administrative costs and complexity. Administering premium subsidies for low-income people has proven expensive.

Second, some Dutch people remain uninsured, and there has been a substantial increase in the number of insured persons failing to pay their insurance premiums.

Third, the expansion of consumer choice has not worked as envisioned. Since 2007, only about 4% of the Dutch population, on average, has changed plans each year. Moreover, accelerating consolidation of the health insurance market has restricted meaningful choice of insurance plan. Currently, four insurance conglomerates control about 90% of the Dutch health insurance market. Recent polls suggest public dissatisfaction with private insurers, with 65% of insured people reporting that they have low or very low levels of trust in private plans.

Fourth, notwithstanding the rhetoric of competition, the Netherlands still relies heavily on regulation. Indeed, the Dutch case shows that competitive systems that seek to escape supposedly centralized, bureaucratic control of medical care paradoxically require sophisticated regulation and government intervention in order to work.

The comprehensiveness of health insurance in the Netherlands provides a critical contrast to the Ryan Medicare plan, which would erode the U.S. government’s contribution to the point that 65-year-old beneficiaries would pay about two thirds of medical costs themselves.

The myth that competition has been key to cost containment in the Netherlands has obscured a crucial reality. Health care systems in Europe, Canada, Japan, and beyond, all of which spend much less than the United States on medical services, rely on regulation of prices, coordinated payment, budgets, and in some cases limits on selected expensive medical technologies, to contain health care spending. Systemwide regulation of spending, rather than competition among insurers, is the key to controlling health care costs. The Netherlands, after all, spent much less on medical care than the United States with virtually universal insurance coverage long before it began experimenting with managed competition in 2006.

The Dutch experience provides a cautionary tale about the place of private insurance competition in health care reform. The Dutch reforms have fallen far short of expectations — a reminder that policy intentions should not be confused with outcomes and that managed competition is hardly a panacea. The idea that the Dutch reforms provide a successful model for U.S. Medicare to emulate is bizarre. The Dutch case in fact underscores the pitfalls of the casual use (and misuse) of international experience in U.S. health care reform debates.

http://healthpolicyandreform.nejm.org/?p=14712

The authors of this NEJM Perspective on lessons from the Netherlands – Kieke G.H. Okma, Ph.D., Theodore R. Marmor, Ph.D., and Jonathan Oberlander, Ph.D. – are highly credible authorities on comparative studies and the politics of health care reform. The facts they present are well documented, and the conclusion is so obvious that it is essentially a restatement of the facts: “Systemwide regulation of spending, rather than competition among insurers, is the key to controlling health care costs.”

To no surprise, some of the published responses in the NEJM have challenged the credibility of these noted authorities, and instead have chosen to reframe the discussion – presenting “free markets,” “competition” and “consumer choice” as if these were the facts. These critics dismiss the results in the Netherlands because their “managed competition” system failed to use free market principles.

Which is it? Do we adopt Netherlands-style managed competition because it allows private insurers to compete, even though that hasn’t been proven to be of benefit? Or do we reject all existing models and adopt a truly free market wherein patients pay for all health care with their own cash? Of course, that can’t work either because of the necessity of pooling funds, and as soon as you have introduced the insurance function, you have suppressed the “price-based signals” and distorted the market.

Of course, neither of these choices – framed in terms of “markets” – will work. What does work – framed in terms of thoroughly documented studies of functioning health systems – is “regulation of prices, coordinated payment, budgets, and in some cases limits on selected expensive medical technologies.” That requires a major role for government, as the Netherlands is rediscovering.

Although the authors present this as a lesson for Medicare, it is actually a lesson for our entire health care system. Perhaps they anticipate when Medicare will be improved and then expanded to cover everyone. Let’s hope so.

By Joanna Bisgaier, M.S.W., and Karin V. Rhodes, M.D.
The New England Journal of Medicine, June 15, 2011

Expansions of Medicaid and the Children’s Health Insurance Program (CHIP) are designed to extend access to high-quality medical care to all U.S. children. However, evidence suggests that the 37 million children covered by Medicaid–CHIP are less likely to receive specialty care than children covered by commercial insurance.

We designed an audit study in which research assistants posing as mothers made paired calls to the same clinic and attempted to schedule an appointment for a child needing specialty care. The calls were separated by 1 month and varied only by insurance status (private vs. Medicaid–CHIP insurance).

With the use of an experimental study design involving simulated requests for specialty care, we measured real-world scheduling behavior in an urban area with a high density of medical specialists. The results showed significant disparities in children’s access to needed outpatient specialty care, attributable to specialists’ reluctance to accept public health insurance. These results held across all audited specialties. (66% of the callers reporting Medicaid–CHIP coverage were denied an appointment for specialty care, as compared with 11% of the callers reporting Blue Cross Blue Shield insurance.) Moreover, even when children with Medicaid–CHIP were not denied appointments outright, the appointments were, on average, 22 days later than those obtained for privately insured children with identical health conditions (even though the clinical scenarios represented urgent situations).

Overall, we found considerable disparities in access to outpatient pediatric specialty care that were attributable to providers’ nonacceptance of public insurance.

http://healthpolicyandreform.nejm.org/?p=14707&query=TOC

Comment: 

By Don McCanne, MD

A well functioning health care system removes barriers to the care that patients need. It is sad commentary that the United States has a program for the most needy that instead crates a barrier to care. As this study shows, merely being covered by Medicaid disqualifies many children from being able to access the specialized care that they need.

This doesn’t happen in other nations. If a person needs care, access is automatically provided without any thought given to the mechanism of payment.

In the United States, even though we have more than enough money already in the system to pay for all essential care, we have erected a wasteful, fragmented, dysfunctional financing system that creates barriers that must be negotiated before appropriate care can be obtained. It’s not the money; it’s the flawed financing system.

We need to cast aside these barriers and create an equitable financing system that is automatic – a single payer national health program. We have the money. Now all we need is the political will.