PNHP

Health bill would allow waivers in 2014

Health bill would allow waivers in 2014

By NEAL P. GOSWAMI
Bennington Banner, 01/18/2011

BENNINGTON – Vermont’s congressional delegation joined Gov. Peter Shumlin Tuesday to announce legislation that would allow states to seek federal health care waivers in 2014, and the flexibility to craft their own state-level health care plans.

Landmark health care reform legislation signed into law last year by President Barack Obama provides states the option of seeking a federal waiver to opt out of some requirements of the bill as long as certain standards are maintained. That provision was sought by U.S. Sen. Bernie Sanders, a Vermont independent. But the law currently does not allow those waivers until 2017.

Campaign promise

Shumlin, a Democrat sworn in to office earlier this month, promised during the campaign that he would seek a single-payer health care system for the state. He said acquiring the needed federal waivers would be the easy part of implementing such a system. Vermont’s congressional delegation is hoping to prove him right.

Sanders joined U.S. Sen. Patrick Leahy and Rep. Peter Welch, both Democrats, at a Statehouse press conference Tuesday morning to announce the “State Leadership in Healthcare Act,” which would allow states to move forward with state-level plans three years sooner.

“At a time when 50 million Americans lack health insurance and when the cost of health care continues to soar, it is my strong hope that Vermont will lead the nation in a new direction through a Medicare-for-all single-payer approach. The goal is clear – quality,
Advertisement
cost-effective health care for all Vermonters,” Sanders said. “This is essential not only for the well-being of all Vermonters but for job creation. We must do all we can to lower the crushing costs of health care that are now devastating Vermont businesses and their employees.”

Sanders plans to introduce the bill in the Senate for himself and Leahy. Welch will introduce the bill in the House.

Last year’s health care changes extend access to health insurance to about 32 million more Americans. But Shumlin and the state’s congressional delegation said Tuesday that states should be allowed to make additional improvements on their own to help better control costs.

Allowing waivers in 2014 will keep states from spending money on health insurance exchanges, which are required for all states by 2014. A state receiving a waiver to implement its own system would likely dismantle the exchange, anyway.

A waiver would allow states to collect federal funding – including Medicaid, Medicare and the Children’s Health Insurance Program – to finance state-level pilot health care systems. Those plans must be as comprehensive and affordable as the federal model and cover as many people, however. Waivers will not be granted for plans that offer lower quality or less affordable coverage, according to the Vermont officials.

The bill also calls for HHS to create an application that includes required waivers.

Shumlin said the legislation will deliver federal money required to implement a state-level plan that covers all Vermont residents in a more timely manner. “We want to do it better and faster than the federal law contemplates. We want to control costs and cover everyone,” Shumlin said. “I am so pleased that our congressional delegation supports us in this effort, and I thank them for introducing this important legislation.”

The announcement of the legislation comes as the GOP-led U.S. House prepares to vote this week on repealing the federal health care law. While the measure is expected to clear the House, it will almost certainly come to a halt in the Senate, which remains under the control of Democrats.

Leahy said repeal efforts are a step backward. Allowing states to obtain waivers sooner will help better the federal legislation, he said. “While some in Washington are trying to turn the clock back on health reform, Vermont instead is moving forward. This state waiver bill will give Vermont and other states the choice to go above and beyond what the federal health care law does by devising their own reforms,” he said. “Vermont has always been a leader in health care quality and access, and this bill will give our state the flexibility we want to offer Vermonters the best care and coverage while controlling costs.”

Welch, in a telephone interview, said the proposed changes to federal law will allow Vermont to move forward the way it best sees fit. “We’ve got to get our arms around the costs and single-payer flexibility would give the governor and the state the ability to do the job,” he said. He noted, however, that other states could develop their own plans, which might be very different from what Shumlin hopes to implement.

“If another state wanted to pursue it through another way that works for them, they could,” Welch said. “We believe there is a way to get support from among Republicans who may be against single-payer. The waiver is not promoting single payer, it’s promoting flexibility,” he added.

While “leadership is coming from Vermont,” other states are also interested in obtaining a waiver, Welch said, including “red” states. “I’ve been talking regularly to Gov. Shumlin and he’s said some pretty conservative governors are interested in having some flexibility,” Welch said.

Cooperation is also expected from the White House, Welch said. “[HHS] Secretary [Kathleen] Sebelius is the one we’ve had contact with and she’s a former governor herself and has indicated significant interest in this. I think we’ll find cooperation from the White House in this,” Welch said.

Tuesday’s press conference precedes a report expected to be delivered to lawmakers today by Dr. William Hsiao, a Harvard University economist. Hsiao was hired by the state to design three separate universal health care plans for the state, including a single-payer plan, according to the law passed last year that calls for the health system options.

“This is just the beginning of this process, and there are other waivers we will need to get it done. If we work together, I am convinced we can persuade the federal government they should not stand in our way,” Shumlin said.

Contact Neal P. Goswami at ngoswami@benningtonbanner.com

http://www.benningtonbanner.com/ci_17131163

Wendell Potter speaks in Bloomington, Ind

By Michela Tindera
Indiana Daily Student, Jan. 17, 2011
 
More than 415 people filled the Buskirk-Chumley Theater on Sunday as Wendell Potter, former head of corporate communications at health insurance giant CIGNA, attempted to blow the whistle on corporate insurance.
 
After resigning from his post at CIGNA in May 2008, he began tireless efforts to protest the immoralities of corporate public relations.
 
By publishing his first book, “Deadly Spin: An Insurance Company Insider Speaks Out on How Corporate PR is killing Health Care and Deceiving Americans” and going on tour, Potter has attempted to shed light on the health care industry.
 
The book signing and speech by Potter as well as a screening of the related 2007 Michael Moore documentary “Sicko,” which was also a critique of the injustices of the health insurance industry, was sponsored by Hoosiers for a Commonsense Health Care Plan.
Considering his 20 years of experience in corporate public relations, first with Humana and then with CIGNA, it may have been difficult to imagine that Potter’s next career move would be to become what Time Magazine calls “the ideal whistleblower” in the campaign against the injustices of the health insurance industry.
 
“I didn’t think I’d get this involved,” Potter said. “It was very scary, but I decided if I ever had the chance to make a difference, I wanted to.”
 
Yet it was a personal decision following events during the course of a couple years that made him want to turn in his papers.
 
“There were three strikes that occurred to me before I decided to resign,” Potter said.
The first strike was the release of “Sicko.” It was part of Potter’s job to discredit this film in order to maintain a positive reputation for CIGNA.
 
“It was especially daunting to me to disprove because I realized Michael Moore had gotten it right,” Potter said in his speech.
 
Shortly after, on a visit to his hometown in Tennessee, he came upon a makeshift clinic in nearby Wise County, Va., where hundreds of people were lined up in front of a barn to receive health care.
 
The death of a CIGNA policyholder was the final strike against the health insurance industry for Potter.
 
It was also Potter’s job to deal with “squeaky wheels,” or policyholders with complaints. One such family was that of 17-year-old Nataline Sarkisyan in late 2007.
 
Sarkisyan was a patient in need of a liver who was eligible for transplant, according to doctors at University of California, Los Angeles. Yet Sarkisyan was deemed ineligible by a CIGNA employee who claimed the surgery would be experimental.
 
While her surgery was eventually allowed after her family and their lawyers generated enough bad press, CIGNA’s approval came too late. Sarkisyan died within hours of the news from CIGNA.
 
“That did it for me,” Potter said. “I could not in good conscience continue working.”
 
Potter said the main reason for the injustices committed by health insurances giants is their greater concern for meeting the expectations of Wall Street shareholders and analysts like Goldman Sachs than the needs of actual patients.
 
While a health care act repeal may be underway, Potter said this attempt is a smokescreen to allow health insurance companies to strip out consumer protections that would be beneficial.
 
“It’s a shame that corporations have so much political power,” Bloomington City Council representative Isabel Piedmont-Smith said after Potter’s speech.
 
However, the health insurance industry is a proponent of some provisions of health care reform, such as the requirement that nearly everyone buy health insurance by 2014 or be severely fined.
 
“If people were well-informed and not victimized by the industry, it’d be a no-brainer,” said Chris Stacks, Indianapolis physician and member of HCHP. “Health insurance companies do not add any value to the transaction. There’s no point to pay 25 percent to a middleman.”
 
Potter recommended college students stay informed and get involved to make necessary changes. Students can call congressmen, write letters to the editor of their local newspapers, and stay informed on current events.
 
“This is important for all of us,” Potter said. “Young people need coverage as they get older. They need to think ahead.”
 
http://www.idsnews.com/news/story.aspx?id=79230

‘Sicko’ showing draws crowd, emotions

By Kelsey Holder
Indiana Daily Student, Jan. 18, 2011

Advocates of American health care reform filled the chairs of the Buskirk-Chumley Theater on Sunday.
 
They silenced themselves as IU Jacobs School of Music Sylvia McNair sang an a cappella version of “Down to the River to Pray.”
 
“As I went down in the river to pray / Studying about that good ol’ way / And who shall wear the robe and crown? / Good Lord, show me the way.”
 
McNair and guitarist David Gulyas treated the advocates with four other songs: “Blowin’ in the Wind,” Harold Arlen’s “Over the Rainbow,” “Greensleeves” and “Let There Be Peace on Earth.”
 
“We let them choose the songs they’d be sharing,” said Dr. Rob Stone, director of Hoosiers for a Commonsense Health Plan. “They chose well.”
 
Bloomington residents and other locals were there to watch Michael Moore’s 2007 documentary “Sicko” and speak with the whistle-blower Wendell Potter about his insight to health insurance companies in America.
 
Potter stopped by the Buskirk-Chumley Theater during his book tour of the newly released “Deadly Spin: An Insurance Company Insider Speaks Out on How Corporate PR Is Killing Health Care and Deceiving Americans.”
 
“We thought showing ‘Sicko’ would nicely complement the book tour,” Rob Stone’s wife and fellow advocate Karen Green Stone said.
 
Rob and Karen housed Potter during his weekend visit and organized the free event sponsored by Hoosiers for a Commonsense Health Plan.
 
John and Rosalie Neel are members of Hoosiers for a Commonsense and ushered the event.
 
“We’ve never seen ‘Sicko,’” Rosalie said. “We’re very excited.”
 
The couple, along with other ushers, wore shirts that quoted Dr. Martin Luther King Jr.:
 
“Of all the forms of inequality, injustice in health care is the most shocking and inhumane.”
 
The fronts of the shirts read “Medicare for All.”
 
“We’re on Medicare,” John said. “We get the quality that everyone should get.”
 
Although they receive full benefits from Medicare, they still firmly believe in the Hoosiers for a Commonsense mission.
 
“We went to our first meeting about a year and a half ago because of an ad in the paper,” John said. “We’ve been going ever since. One meeting is all it takes.”
 
As the Buskirk-Chumley house filled to more than 415 people, the largest attendance yet of Potter’s book tour, the anxiousness for the 3 p.m. showing of “Sicko” grew.
 
“The movie ‘Sicko’ itself is a wake-up call,” Potter said. “It is both emotionally affecting and effective. Michael Moore achieved his objective.”
 
Potter screened the film twice before its release in 2007, while he still held the PR executive position for CIGNA.
 
“I thought, ‘Oh my, I can’t believe he made a movie this accurate,’” he said. “I knew it’d be a challenge to discredit it.”
 
Potter confirmed the authenticity of the documentary, admitting that it uncovers a side of health care that most choose not to see.
 
“The arts have a significant role to play in communicating and reaching people,” he said. “You can reach people on an emotional level. The movie ‘Sicko’ does that.”
 
http://www.idsnews.com/news/story.aspx?id=79226

Doran: A health care bubble about to burst

By Terry Doran
VTDigger.com, January 15, 2011

Editor’s note: This op-ed is by Terry Doran, a resident of Montpelier. His wife, is Dr. Deborah Richter, a single-payer advocate.

When we talk about health care reform, what are we really talking about?

Reform says there is something to correct. What is it?

There are a lot of answers. The quality of care. The delivery of care. The cost of health insurance. The wildly discrepant charges by doctors and hospitals. Those are some, and they break down into narrower and narrower topics, all of which could do with some correction, perhaps.

By now few, if any of us, believe the costs of health care are sustainable much longer. There are clear signs we are in huge trouble. This is widely, clearly understood.

We seem to be living in a health care bubble about to burst. The alarm grows more urgent year by year, and yet nothing close to the scope of the problem is attempted. Vermont has tried tiny corrections with tiny discernible effects, not all of them good. What now?

Could it be that it goes much deeper, this problem? Everyone knows there are selfish interests who want corrective change kept to between none and the minimum.

It looks like what is needed is a kind of religious conversion. We’ve allowed something to happen in health care because we had faith and now that faith has been thoroughly discredited.

It goes like this:

Our health care is an admixture of a market-model (health care stores for individual buyers with enough money) and a public good (health care services financially supported by society).

In Vermont most health care professionals and the services, hospitals, etc., act as though health care is a public good, which is the same thing as saying its primary reason for being is to benefit the public as a whole.

Our faith, delirious you could argue, was to believe that a market model could solve – mysteriously, magically – any problem thrown in its way. You can decide if this was true in big banking and Detroit auto manufacturing.

There is now a mountain of evidence that our awkward coupling of the health care stores idea to the health care services idea is a really bad idea. It doesn’t work.

One good reason for this is that a public good isn’t limited to one segment of the population, however you define that group. It excludes no one. A market-model does. It excludes some, the some usually being those without enough money.

Our deepest problem is to understand a public good, how it works and why, and what it can mean for health care. We don’t exclude some youngsters from public education; we don’t exclude some families from fire and police protection; we don’t exclude some drivers from full use of roads and highways.

Characteristic of all these, and other public goods, is that they are collectively funded by us all for us all. The implied agreement is that individually we know we are unlikely to be able to pay for a school, fire department, police force, or a road without the help of everyone else.

Health care is exactly the same, except that we have mostly fallen into the trap of looking at it as an individual purchase and not a public good. When we use it, we tend to think we’re up for paying for it, or our insurance is. But in fact the very existence of the services (a hospital, a nurse, a doctor) we intend to buy from depend on collective financing.

At this moment Vermont stands at a unique point in time. It’s the only state on the cusp of adopting a health care system that is coordinated to benefit the whole of the Vermont public. Our legislature has asked a highly-regarded health economist, William Hsiao of Harvard, and his working group to design three systems to study and perhaps legislate from.

We won’t know what the designs look like until Wednesday morning. But if what eventuates does not move us clearly and in a step-wise manner toward health care as a public good, then our unique moment will have been lost. And the next sound you hear could be the sound of a bubble bursting.

http://vtdigger.org/2011/01/15/doran-a-health-care-bubble-about-to-burst/

Doctor urges single-payer health plan

Advocate invokes King during talk

By Nancy C. Rodriguez
Louisville Courier-Journal, Jan. 15, 2011

President Barack Obama’s landmark health care law was significant, “but it is not enough and it will not solve our problem,” a national advocate for single-payer health insurance told an audience Saturday at the Urban League of Louisville.

The legislation still leaves 23 million Americans uninsured and without access to quality health care, said Dr. Claudia Fegan, past president of Physicians for a National Health Program.

“This is about justice,” she said. “Heath care should be a right to which everyone is entitled.”

Fegan was the guest speaker at an event that was sponsored by Physicians for a National Health Program-Kentucky and Kentuckians for Single Payer Health Care and tied to Dr. Martin Luther King Jr.’s birthday. It was called “Remembering Dr. King’s Cry for Justice in Health Care” and was attended by about 60 people, including Louisville Mayor Greg Fischer, Louisville Urban League executive director Ben Richmond and U.S. Rep. John Yarmuth, D-3rd District.

“I want everyone in our community, and particularly in the South and minorities, to know we can do a better job of providing health care to all our citizens,” said Dr. Garrett Adams, president and Kentucky coordinator for Physicians for a National Health Program.

During her talk, Fegan — who practices primary care internal medicine at the Woodlawn Health Center of Cook County in Chicago — said African Americans are more likely to be uninsured and suffer from higher rates of cancer, heart disease, diabetes and HIV.

“This is our issue. … This is our reality,” said Fegan, who called the fight for better health care the civil-rights struggle of the 21st century.

A single-payer health care system would involve the government or a government-run organization collecting all health care fees and paying out all health care costs.

Fegan said she knows some are reluctant to criticize Obama’s health care law because they support the president. “I think Dr. King would say it’s important to tell the truth. Remember, he said, ‘The time is always right to do the right thing,’” she said.

She said a single-payer plan would lead to better access to quality health care for all Americans. “There are no easy solutions. We have to be willing to fight and continue to fight,” said Fegan, who ended her talk by leading a chant of, “Everybody in, and nobody out.”

Fegan’s comments came just days before the U.S. House of Representatives is expected to vote to repeal the health care law. The repeal vote would fulfill a campaign promise of Republicans who won control of the House in the November elections. The measure is expected to stall in the Senate, where Democrats remain in control.

Obama has said he would veto a repeal if Congress passes it.

Democrats argue that the health care law, which was signed last year, will expand coverage to millions of uninsured Americans and help rein in soaring medical costs. Republicans argue that the coverage mandated in the legislation is unconstitutional and that penalties for employers who don’t provide coverage discourage hiring.

Yarmuth said the health care law was “an important first step,” but he acknowledged that “it was not what I wanted to see. I’m a single-payer guy.”

He said health care is a moral issue. “It’s not a question of politics; it’s not a question of economics,” he said. “It’s a question of morality.”

http://www.courier-journal.com/article/20110115/NEWS01/301150075/Doctor+urges+single-payer+health+plan

Only Washington has cure for fear of major medical bills

Health care costs are devastating the U.S. middle class in ways not seen in countries that have universal care.

By RICHARD C. DILLIHUNT, M.D.
The Portland (Maine) Press Herald, Jan. 1, 2011

PORTLAND – Fear is a distressing emotion aroused by an impending danger. This simple four-letter word commands attention in a myriad of daily circumstances in the lives of men. Fear can paralyze any person or nation — thank goodness FDR saw this coming.

Perhaps the first expression of fear in primates is the Moro reflex, in which the infant, when startled, instinctively throws out his arms, spreads his fingers and then grasps for his mother.

Creatures below man rely upon fear for survival; see the spider roll up in a ball, the lobster in reverse gear or the chipmunk disappear into a hole seemingly too small for escape.

In medical practice, fear is a constant visitor to patients, and the allaying of apprehensions assumes a dominant role in the doctor-patient relationship. A hidden, quiet, highly personal part, it’s nonetheless a crucial  factor in the strategic approach to management of the medical problem at hand.

As an aside, this is one of several reasons why attempts at involvement of political forces in patient care are unsuccessful — even laughable when brought to bear awkwardly, as we have seen during recent health care debates. As my dad said, “If you want to comment on that, go first to medical school.” So I did.

With the skyrocketing of  health care costs continuing, it has become evident that this is contributing deeply to our decrepit economy, and to the overall national health (or lack of it).

Newspaper and magazine articles as well as books are written about this morass, but lurking in the background is a complex element of our situation that hasn’t surfaced as a significant factor.

Yes, it’s fear itself. When this box is opened, a vast seascape is exposed, and one wonders how this subject has remained under cover.

The mechanics and importance of fear in this setting deserve a look.

The insurance industry is afraid of losing its control over Washington by restriction of campaign donations; the pharmaceutical industry fears price control, and the legal profession fears tort reform.

The medical profession is shaking at the thought of losing reimbursement for services rendered and hospitals fear competition among themselves, while politicians fear loss of campaign funding, completing a circle reminding one of buffalo under siege.

More importantly, outside the circle, fear is entrapping a huge category of health care recipients — our vast middle class who have absorbed repeated blows by armies of providers bellying up to the troughs, feasting on a source of great riches that has a decidedly detrimental effect on America’s economy.

Let’s explore this matter to illuminate our health care system — especially how it compares to other countries. Ours is much more expensive, has no price controls, penalizes business the most and allows bankruptcy due to inability to pay.

In a large number of middle-class patients receiving major care, a second fear is manifest under our system.

This is the fear of economic consequences and secondary personal humiliation occurring weeks later when the bills arrive. Insurance coverage, health savings accounts, deductibles and personal savings accounts are inadequate. The bills are so astronomical that fear again appears — and rules.

This is fear of economic consequences with personal humiliation, a situation not seen in nations with universal health care. It’s perhaps best depicted by a fictitious example:

John Recipient, age 50, has a complicated gastrectomy  requiring prolonged hospitalization. After health insurance payments he still owes $75,000 to the hospital and physicians. His disability insurance covers only his basic needs.

He borrows from his aged parents and his 401(k), his wife returns to work, his employer suffers from hard times and John has no job. His daughter cancels plans to attend Yale and two family cars go without payment for two months, requiring the sale of one to pay for the other.

Credit cards are maxed out, his mortgage is in arrears with ultimate foreclosure at a huge loss, and his youngest son needs braces.

Along the line a deep-seated throbbing, even palpable fear, has developed, along with loss of self-respect and despair. Bankruptcy is filed, and a middle-American family lies in economic ruin.

This does not happen in Canada or other industrialized countries with universal health care. It happens right here. Nothing Karl Rove can say will make this story go away. No tea party will correct this social injustice. We are struck another blow in trying to emerge from depression.

Hello, Washington, do you hear the people? We are anxious for change. Please, no more tweaks.

Richard C. Dillihunt, M.D., of Portland is a retired surgeon.

http://www.pressherald.com/opinion/only-washington-has-cure-for-fear-of-major-medical-bills_2011-01-01.html

IOM’s “essential benefits” may serve interests of private insurers

Health care lobby mum on repeal

By Kate Nocera
Politico
January 18, 2011

It’s at meetings like the Institute of Medicine’s Committee on the Determination of Essential Health Benefits where these groups (AHIP and others) can begin to voice their concerns. The committee convened for three days last week to hear from experts, lobbyists and special advocacy groups. The IOM will soon make recommendations to the Department of Health and Human Services on what defines an “essential benefit” that insurers must cover if they want to be listed on the exchanges that are coming in 2014.

Carmella Bocchino, AHIP executive vice president of clinical affairs and strategic planning, asked HHS not to load specific benefits into the bill, so the 10 broad categories of benefits would remain as they are and the market would decide what type of coverage is needed. The group also asked HHS not to include the 2,000 state mandates as part of an essential benefit package. Each state directs insurance providers on what must be covered in the policies they sell. The inclusion of every state mandate in the health care reform law would significantly drive up consumer costs and mandates for all states, which does not necessarily make sense, AHIP argues.

http://www.politico.com/news/stories/0111/47711.html

IOM meeting on essential benefits:
http://iom.edu/Activities/HealthServices/EssentialHealthBenefits/2011-JAN-12/Agenda.aspx

The Institute of Medicine (IOM) will be making recommendations to HHS on the definition of required essential benefits for the health plans that are to be offered through the state insurance exchanges. Several experts testifying before IOM’s Committee have called for flexibility in the definition (testimonies provided at IOM link above).

We should all be concerned that the insurance industry intends to use this approach to “let the market decide what type of coverage is needed.” Although the health reform legislation closed large loopholes in insurance coverage, it is clear that the industry fully intends to use innovations in essential benefit design to continue to profit by depriving patients of essential health care.

It was a terrible mistake to design health care financing reform based on the existing model of private insurance plans. No matter how much the private insurers are regulated, they will always find a way to place their own interests first.

It is not too late to stop this nonsense and do it right – establish our own publicly-administered and publicly-financed single payer national health program, an improved Medicare for all.

Wishful thinking on health costs?

Wishful Thinking on Health Costs

By David Leonhardt
The New York Times
January 13, 2011

Opponents of the health law sometimes like to suggest that cutting health costs would be easy, if only we’d be willing to try common-sense ideas. But that’s wishful thinking. The law does include most of the common-sense ideas supported by health economists ranging from Mark McClellan (the former Bush administration official) to David Cutler (a former Clinton and Obama adviser). There’s just no getting around the fact that reducing the growth rate of health costs will be difficult.

Comment:

By Don McCanne, MD

So many noted policy experts have trumpeted the supposed fact that the health reform law contains essentially all of the cost containment ideas known that now this concept is being accepted unchallenged. This ignores the fact that the most effective model of cost containment was rejected at the very beginning of the reform process.

Numerous microsimulation studies plus the experience of several nations has demonstrated that a single payer system (e.g., an improved Medicare for all) actually bends the cost curve down when contrasted with the fragmented, multi-payer system that we have in the United States.

These same microsimulation studies show that building on our current system, which is precisely what the current law does, is the most expensive model of reform, primarily because it retains the profound administrative inefficiencies that are a major contributor to our very high costs. Setting medical loss ratios recovers only a negligible portion of the administrative waste which permeates our system. The many other efficiencies of a single payer system, such as reducing the administrative burden on the health care delivery system, would recover much of this waste.

Another factor that is not receiving the attention that it should is that the current law can never result in truly universal coverage – tens of millions will remain uninsured. A single payer system not only costs less and slows the growth of health costs into the future, it also automatically covers everyone. Moreover, it uses progressive tax policies to ensure that funding is equitable, making health care affordable for everyone.

The popularity of Medicare is understandable, since it provides us with health security in our later years. But the projected spending increases in this high-risk pool are of concern. We could fix that problem immediately by diluting the costly Medicare pool with the couple hundred million of us who are relatively healthy.

We’re already paying for the Medicare pool anyway, so why shouldn’t we all have the advantage of an efficient health care financing system that eliminates the profound waste of our costly, dysfunctional, fragmented system of a multitude of private and public payers? An improved Medicare for all is the only practical solution to our problem of intolerable cost increases.

http://community.nytimes.com/comments/economix.blogs.nytimes.com/2011/01/13/wishful-thinking-on-health-costs/?permid=16#comment16

Wishful thinking on health costs?

Wishful Thinking on Health Costs

By David Leonhardt
The New York Times
January 13, 2011

Opponents of the health law sometimes like to suggest that cutting health costs would be easy, if only we’d be willing to try common-sense ideas. But that’s wishful thinking. The law does include most of the common-sense ideas supported by health economists ranging from Mark McClellan (the former Bush administration official) to David Cutler (a former Clinton and Obama adviser). There’s just no getting around the fact that reducing the growth rate of health costs will be difficult.

So many noted policy experts have trumpeted the supposed fact that the health reform law contains essentially all of the cost containment ideas known that now this concept is being accepted unchallenged. This ignores the fact that the most effective model of cost containment was rejected at the very beginning of the reform process.

Numerous microsimulation studies plus the experience of several nations has demonstrated that a single payer system (e.g., an improved Medicare for all) actually bends the cost curve down when contrasted with the fragmented, multi-payer system that we have in the United States.

These same microsimulation studies show that building on our current system, which is precisely what the current law does, is the most expensive model of reform, primarily because it retains the profound administrative inefficiencies that are a major contributor to our very high costs. Setting medical loss ratios recovers only a negligible portion of the administrative waste which permeates our system. The many other efficiencies of a single payer system, such as reducing the administrative burden on the health care delivery system, would recover much of this waste.

Another factor that is not receiving the attention that it should is that the current law can never result in truly universal coverage – tens of millions will remain uninsured. A single payer system not only costs less and slows the growth of health costs into the future, it also automatically covers everyone. Moreover, it uses progressive tax policies to ensure that funding is equitable, making health care affordable for everyone.

The popularity of Medicare is understandable, since it provides us with health security in our later years. But the projected spending increases in this high-risk pool are of concern. We could fix that problem immediately by diluting the costly Medicare pool with the couple hundred million of us who are relatively healthy.

We’re already paying for the Medicare pool anyway, so why shouldn’t we all have the advantage of an efficient health care financing system that eliminates the profound waste of our costly, dysfunctional, fragmented system of a multitude of private and public payers? An improved Medicare for all is the only practical solution to our problem of intolerable cost increases.

http://community.nytimes.com/comments/economix.blogs.nytimes.com/2011/01/13/wishful-thinking-on-health-costs/?permid=16#comment16

Gov. Christie claims that health care will bankrupt New Jersey

Christie Says Health-Care Costs to Bankrupt New Jersey Without Concessions

By Terrence Dopp
Bloomberg
January 13, 2011

New Jersey Governor Chris Christie said health-care costs “will bankrupt” the state unless it requires workers to pay more for medical coverage.

Christie wants all public employees in New Jersey to contribute more than the current 1.5 percent of salary toward their health benefits.

“We have to have a plan where everyone has some skin in the game,” Christie said. “Right now 1.5 percent is just something we can’t afford. Everyone knows that but they won’t say it.”

http://www.bloomberg.com/news/2011-01-13/christie-says-health-care-costs-to-bankrupt-new-jersey-without-concessions.html

Comment: 

By Don McCanne, MD

“Health care bills are going to bankrupt the government.” New Jersey Gov. Chris Christie is but the latest of conservative politicians to sound this alarm. You would think that they would recommend truly effective policies to bring escalating health care costs under control. But no. They merely wish to shift health care costs from the government, in this case, to their own public employees.

Virtually all economists agree that employer-sponsored health plans actually are paid for by the employees in the form of forgone wage increases. Gov. Christie’s proposal to shift the costs to the employees is not merely a nominal transfer of the payment responsibility; it is a true shift because he is not going to replace the forgone wages.

In trying to contain health care costs we need to look at our entire health care spending, not simply how it is distributed between public and private payers. Reducing government spending on health care by shifting it to others does not reduce total health care spending, except in one very important regard. Making health care unaffordable rations health care based on the inability to pay – the most inhumane form of rationing, and one that is uniquely American.

The claim that health care costs will bankrupt the government is a false claim since we have one of the lowest total tax burdens of all industrialized nations. A very modest increase in tax revenues would solve this problem. On the other hand, passing health care costs onto already financially-strapped employees will surely increase the rate of personal bankruptcies.

I am especially appalled by Gov. Christie’s use of the old standby argument that patients need “more skin in the game.” It creates visions of patients who are out of money and are forced to turn to their own skin to barter for the health care that they desperately need – only to learn that skin is not accepted at banks or currency exchanges.

Gov. Christie claims that health care will bankrupt New Jersey

Christie Says Health-Care Costs to Bankrupt New Jersey Without Concessions

By Terrence Dopp
Bloomberg
January 13, 2011

New Jersey Governor Chris Christie said health-care costs “will bankrupt” the state unless it requires workers to pay more for medical coverage.

Christie wants all public employees in New Jersey to contribute more than the current 1.5 percent of salary toward their health benefits.

“We have to have a plan where everyone has some skin in the game,” Christie said. “Right now 1.5 percent is just something we can’t afford. Everyone knows that but they won’t say it.”

http://www.bloomberg.com/news/2011-01-13/christie-says-health-care-costs-to-bankrupt-new-jersey-without-concessions.html

“Health care bills are going to bankrupt the government.” New Jersey Gov. Chris Christie is but the latest of conservative politicians to sound this alarm. You would think that they would recommend truly effective policies to bring escalating health care costs under control. But no. They merely wish to shift health care costs from the government, in this case, to their own public employees.

Virtually all economists agree that employer-sponsored health plans actually are paid for by the employees in the form of forgone wage increases. Gov. Christie’s proposal to shift the costs to the employees is not merely a nominal transfer of the payment responsibility; it is a true shift because he is not going to replace the forgone wages.

In trying to contain health care costs we need to look at our entire health care spending, not simply how it is distributed between public and private payers. Reducing government spending on health care by shifting it to others does not reduce total health care spending, except in one very important regard. Making health care unaffordable rations health care based on the inability to pay – the most inhumane form of rationing, and one that is uniquely American.

The claim that health care costs will bankrupt the government is a false claim since we have one of the lowest total tax burdens of all industrialized nations. A very modest increase in tax revenues would solve this problem. On the other hand, passing health care costs onto already financially-strapped employees will surely increase the rate of personal bankruptcies.

I am especially appalled by Gov. Christie’s use of the old standby argument that patients need “more skin in the game.” It creates visions of patients who are out of money and are forced to turn to their own skin to barter for the health care that they desperately need – only to learn that skin is not accepted at banks or currency exchanges.

Is anybody listening on controlling costs?

The CBO Is Telling Us Something. Is Anybody Listening?

By Austin Frakt
Kaiser Health News
January 11, 2011

The problem is health care costs. They’ll cause budgetary distress with or without health reform. The CBO’s estimates, both of them, show it clearly. Health care costs have been the source of budgetary woes for decades, and there’s no end in sight under any realistic scoring of any serious health reform proposal.

One way to get serious is to embrace the cost control provisions of the new law and to protect them from the likely efforts of future policymakers to undo them. In this, I agree with health economist Henry Aaron, who wrote about the health reform law:

“[T]he bill contains, at least in embryonic form, virtually every idea for cost control that any analyst has come up with. … The most practical cost-control strategy that is now available to Congress is to accelerate the implementation of these provisions, not to stymie them.”

http://www.kaiserhealthnews.org/Columns/2011/January/011111frakt.aspx

And…

A Milestone in the Health Care Journey

By Ronald Brownstein
The Atlantic
November 21, 2009

“I’m sort of a known skeptic on this stuff,” (Jonathan) Gruber told me. “My summary is it’s really hard to figure out how to bend the cost curve, but I can’t think of a thing to try that they didn’t try. They really make the best effort anyone has ever made. Everything is in here….I can’t think of anything I’d do that they are not doing in the bill. You couldn’t have done better than they are doing.”

http://www.theatlantic.com/politics/archive/2009/11/a-milestone-in-the-health-care-journey/30619/

Comment: 

By Don McCanne, MD

Austin Frakt’s voice is now added to those of Jonathan Gruber , Henry Aaron and others who claim that every cost control measure is in the Patient Protection and Affordable Care Act (PPACA). Yet they left out the most effective measure of all – single payer – the one that wasn’t even granted a seat at the table.

Over 30 percent of our national health expenditures are diverted to administration. That is almost twice the percentage of administrative costs in Canada – a nation with a single payer system. If we were to adopt the administrative efficiencies of Canada’s single payer system, we conceivably could recover about 14 percent of our national health expenditures, not in just the first year, but in every year to follow. Even if we were to recover only 10 percent, think of what that would amount to over the years.

The authors of PPACA were aware of this administrative waste, but because they elected to leave the fragmented system of private insurers and public programs in place, they focused narrowly on the administrative costs of the private insurers, which is only a fraction of the administrative costs of our system. They decided to allow the insurers to continue to use 15 to 20 percent of their revenues for administrative functions and profits. Since some were already functioning at this level – especially the non-profits – the net savings is almost negligible. More importantly, this did not address any of the other administrative excesses – especially the huge administrative burden placed on the providers of health care.

There are other important cost-saving features of a single payer system that were also left out of PPACA. These include very effective tools such as the monopsonistic power of a single buyer, global budgeting, negotiated rates, bulk purchasing, and preventing over-utilization of excessive capacity through separate budgeting of capital improvements. These measures, along with the permanent administrative savings, truly bend the cost curve down to more sustainable levels.

Austin Frakt asks the right question. Is anybody listening?

Is anybody listening on controlling costs?

The CBO Is Telling Us Something. Is Anybody Listening?

By Austin Frakt
Kaiser Health News
January 11, 2011

The problem is health care costs. They’ll cause budgetary distress with or without health reform. The CBO’s estimates, both of them, show it clearly. Health care costs have been the source of budgetary woes for decades, and there’s no end in sight under any realistic scoring of any serious health reform proposal.

One way to get serious is to embrace the cost control provisions of the new law and to protect them from the likely efforts of future policymakers to undo them. In this, I agree with health economist Henry Aaron, who wrote about the health reform law:

“[T]he bill contains, at least in embryonic form, virtually every idea for cost control that any analyst has come up with. … The most practical cost-control strategy that is now available to Congress is to accelerate the implementation of these provisions, not to stymie them.”

http://www.kaiserhealthnews.org/Columns/2011/January/011111frakt.aspx

And…

A Milestone in the Health Care Journey

By Ronald Brownstein
The Atlantic
November 21, 2009

“I’m sort of a known skeptic on this stuff,” (Jonathan) Gruber told me. “My summary is it’s really hard to figure out how to bend the cost curve, but I can’t think of a thing to try that they didn’t try. They really make the best effort anyone has ever made. Everything is in here….I can’t think of anything I’d do that they are not doing in the bill. You couldn’t have done better than they are doing.”

http://www.theatlantic.com/politics/archive/2009/11/a-milestone-in-the-health-care-journey/30619/

Austin Frakt’s voice is now added to those of Jonathan Gruber , Henry Aaron and others who claim that every cost control measure is in the Patient Protection and Affordable Care Act (PPACA). Yet they left out the most effective measure of all – single payer – the one that wasn’t even granted a seat at the table.

Over 30 percent of our national health expenditures are diverted to administration. That is almost twice the percentage of administrative costs in Canada – a nation with a single payer system. If we were to adopt the administrative efficiencies of Canada’s single payer system, we conceivably could recover about 14 percent of our national health expenditures, not in just the first year, but in every year to follow. Even if we were to recover only 10 percent, think of what that would amount to over the years.

The authors of PPACA were aware of this administrative waste, but because they elected to leave the fragmented system of private insurers and public programs in place, they focused narrowly on the administrative costs of the private insurers, which is only a fraction of the administrative costs of our system. They decided to allow the insurers to continue to use 15 to 20 percent of their revenues for administrative functions and profits. Since some were already functioning at this level – especially the non-profits – the net savings is almost negligible. More importantly, this did not address any of the other administrative excesses – especially the huge administrative burden placed on the providers of health care.

There are other important cost-saving features of a single payer system that were also left out of PPACA. These include very effective tools such as the monopsonistic power of a single buyer, global budgeting, negotiated rates, bulk purchasing, and preventing over-utilization of excessive capacity through separate budgeting of capital improvements. These measures, along with the permanent administrative savings, truly bend the cost curve down to more sustainable levels.

Austin Frakt asks the right question. Is anybody listening?