by RTT Staff Writer
4/23/2009

(RTTNews) – A panel of experts told the House Subcommittee on Health, Education, Labor, and Pensions Thursday recommended potential reforms to reduce the cost of health care for employees, employers and their families.

Michael J. Langan of Principal at Towers Perrin manages a group of employee benefits attorneys who analyze legislative and regulatory issues affecting employer benefit and compensation programs, including retirement, health and welfare, executive compensation and other human resource issues. He urged immediate action be taken on health reform.

“These are times of extraordinary economic turmoil and challenges,” he said in prepared remarks. “Some have even suggested that health reform may need to wait until we address other more urgent economic recovery priorities.”

“We take the opposite view,” Langan continued. “Addressing the nation’s health policy challenges is an integral element of — rather than an obstacle to — economic recovery and personal financial security.”

Dr. David Himmelstein, a Harvard professor, proposed a single-payer plan that would cover all Americans and save taxpayers $400 billion annually.

The approach itself is controversial, and President Obama has suggested that it is off the table. However, Majority Leader Harry Reid has said that the Congressional Progressive Caucus “prefers a single-payer approach to health care reform.”

Under a single-payer system, doctors, hospitals and other health care providers are paid from a single fund administered by the government, which eliminates the wasteful spending and high administrative costs of private insurance, saving almost $400 billion annually. This is enough to provide every American with high-quality care, including those who currently have insurance but still cannot afford medications and treatment.

“[A] single-payer reform would make universal, comprehensive coverage affordable by diverting hundreds of billions of dollars from bureaucracy to patient care,” Himmelstein said in his testimony today. “Lesser reforms – even those that include a public plan option – cannot realize such savings. While reforms that maintain a major role for private insurers may be politically attractive, they are economically and medically nonsensical.”

President Barack Obama has made health care reform one of the five pillars of his path to economic recovery. In addition, his budget director Peter Orszag has said that “the path to fiscal responsibility must run directly through health care…the single most important thing we can do to put the nation back on a sustainable (fiscal) course is slow healthcare costs.”

“It is the key to our fiscal future,” Orszag added.

In his $3.55 trillion budget proposal, Obama requested $635 billion to be set aside for an overhaul of the nation’s health care system.

By Dr. David L. Brown
Times Beacon Record, Long Island
January 16, 2009

I admitted a patient today who I previously took care of following a heart attack in July. He was discharged on the appropriate medications, which he took for a month until he lost his job and his health insurance. Without the medications, which he could no longer afford, he suffered another heart attack. Unfortunately he didn’t survive this one.

Although many Americans, President Bush among them, feel America has the best health care in the world, they couldn’t be more wrong. Health care systems are composed of three connected components — accessibility, quality and cost.

U.S. compared to other areas

In each of these areas, health care in the United States lags far behind the rest of the developed world. We have 45 million uninsured citizens and as many as 75 million under insured. Those numbers are rapidly increasing as the economy worsens. Contrary to common belief, the uninsured are not predominantly the homeless and the chronically unemployed. Rather 50 percent are employed and 25 percent are children. Only 5 percent are able to work but are unemployed.

These people are denied access to all but catastrophic care provided in overcrowded emergency rooms. It is estimated that 18,000 patients die annually from the lack of insurance. Sixty percent of the uninsured and 28 percent of the insured go without needed care because they cannot afford it. Half of all bankruptcies are caused by medical bills. Three quarters of those bankruptcies are among people with health insurance. As Martin Luther King Jr said, “of all the forms of inequality, injustice in health care is the most shocking and inhuman.”

In terms of objective measures of quality we must look at population-based statistics which reflects care delivered to the average American. I have no doubt that the quality of care we provide to the president at Bethesda Naval Hospital and the sheiks of Saudi Arabia at the Mayo Clinic is second to none. However, as a country we rank 34th in the world in life expectancy — just above Panama. Our infant mortality rate is 29th in the world — tying us with Slovakia and Poland. As a result of their limited access to quality health care, the poor have significantly reduced life expectancies and increased infant mortalities compared to the rest of the country — speaking to the injustice Dr. King addressed.

Yet despite our poor performance on these and many other measures of health care quality, the U.S. spends far more on health care than every other country in the world. We spend over 2 trillion dollars or 16 percent of our GDP. That works out to 7,000 dollars per person per year. Health care costs are increasing rapidly to the point it is projected that health care spending will increase to 20 percent of GDP by 2017. We already spend one third of every dollar raised in federal state and local taxes on health care, so further increases in spending are not sustainable.

We pay the highest health care taxes in the world. In fact, our current health care taxes amount to more than total health care spending in France, Canada and Britain. And the care in those countries, each of which has universal health care, is superior to ours by most measures of quality.

Vision for a new approach

To improve access, improve quality and control cost, we require a government funded universal health care system. Four principles shape the vision for a new approach to health care:

* Access to comprehensive health care is a human right. It is the responsibility of society through its government to ensure this right. Coverage should not be tied to employment.

* The right to choose and change one’s physician is fundamental to patient autonomy.

* Pursuit of corporate profit has no place in health care.

* In a democracy, the public should set health policies and budgets. Personal medical decisions must be made by patients and their doctors, not by corporate or government bureaucrats.

By universal care, I do not mean that all Americans have some form of insurance, but that all citizens have the same insurance that provides all necessary preventive care, out-patient care, hospital care, prescription drugs, dental care, mental health care and longterm care without co-pays or deductibles, which are barriers to access.

Many current proposals that provide for basic coverage for the poor and better coverage for those with more means create a two-tiered system of care that is unjust. Our country has already discarded “separate but equal” in education and we need to discard it in health care as well. Having everyone in the same system allows the cost of caring for the sickest who are intentionally excluded from private insurance to be spread over the greatest number of persons. Furthermore, keeping those with economic and political resources in the same system as the poor and disenfranchised will allow them to use their influence for the benefit of all.

Paying for such a system

How will we pay for such a system? We already pay enough for universal health care — we just don’t get it. In fact, we get significantly less for our money than people in many other industrialized countries. For example Canadians who live, on average, three years longer than Americans spend only $3,900 for universal care as compared to $7,000 per person per year in the U.S. for far from universal care. Although we hear a lot about waiting lines for care in Canada, Canadians utilize more hospital days, nursing home days, more out-patient visits and are prescribed more drugs per capita than Americans.

Because we pay for health care through a patchwork of private insurance companies, one third of our health care dollar or $2,300 per person per year goes to administrative costs and profits. Replacing private insurers with a national health program would save about $1,150 per person per year or $350 billion annually that is currently wasted on billing, marketing, underwriting and other activities that sustain insurers’ profit but divert resources from care. Combined with what we are already spending, this is more than enough to provide comprehensive coverage for everyone.

Removing profit from health care

If we agree that health care is a right, then for-profit entities have no place in the provision of an inherent right. Creation of a government financed health care system will eliminate the inherent conflict in having for-profit companies involved in health care. The fiduciary responsibility of a for-profit public company is to provide a profit to their shareholders — not to ensure the best health care for their customers. As Milton Friedman wrote: “few trends could undermine the foundations of our free society as the acceptance by corporate officials of a social responsibility other than to make as much money as possible.”

It is inherently obvious that in any health care insurance business, maximum profits can only be achieved by insuring (taking premiums from) the healthiest persons who are least likely to need care and constructing barriers to prevent having to pay for the expensive care of those who need it most-essentially, insuring the healthy. That kind of mercenary strategy has no place in a civilized health care system. In fact the United States is the only place in the world with a thriving for profit health insurance industry.

You may ask “can government run an industry more efficiently that for profit companies?” The answer is an unequivocal yes. The administrative overhead of Medicare or the Canadian health system is about 3 percent. It is at least four times higher than that in the private sector in the U.S.

Another reason to take profit out of health care is because it discourages preventive care. Thirty-one cents of every health care dollar is spend on hospital care while only 3 cents of every dollar is spent on prevention. As we all know, for-profit companies function on a maximal one-year time horizon. Thus, there is no incentive to spend on, or encourage, preventive care today which may not result in a benefit for 20 years. On top of that, in the current environment, people change health care coverage on average every two years. For-profit companies do not want to pay for prevention only to have a competitor company reap the benefit years later.

In addition to eliminating private insurance, for-profit investor owned hospitals, imaging centers, dialysis centers, nursing homes and the like would be banned. These entities have higher administrative costs, reduced expenditures on clinical staff to offset those costs and score lower on most measures of quality than their non-profit counterparts.

Opponents of universal care funded by the government claim that government bureaucrats (as opposed to corporate bureaucrats) will be making medical decisions. But the system is government financed, not government controlled. Individual decisions are left to the patient and doctor.

Proposed system

Private doctors would continue to be paid on a simplified fee schedule or could become salaried employees of hospitals or capitated groups. HMOs that only provide insurance would be phased out. Successful non-profit plans like Kaiser and Group Health would continue to exist but would be funded by the government. Medications would be purchased wholesale.

Quality would be improved by requiring adherence to evidence-based practice guidelines which are currently applied to only about half of patients in the U.S. Of interest, the highest adherence rate to guidelines is in the federally run Veterans Administration health system.

Ultimately, changing to a publicly financed system will save money but the initial transition will probably require revenue in excess of the health care costs currently borne by the government through taxes. Thus, a universal public system would be financed by retaining funds already collected for Medicare and Medicaid. The gap between the current public funding and what we would need would be financed by a payroll tax of 7 percent on employers and an income tax of 2 percent on individuals. The payroll tax would take the place of all other employers’ expenses for employees’ health care. The income tax would replace all current insurance premiums, co-pays, deductibles and other out-of-pocket payments. For most people a 2 percent tax would amount to less than what they currently pay. The 7 percent payroll tax is less than the 8.5 percent most large companies pay.

Furthermore, no employer would gain a competitive advantage over another because they scrimped on health care benefits. And health insurance would no longer be relevant at the bargaining table between employers and employees. Our businesses such as GM will become more competitive as less of the cost of health care has to be passed on to consumers. Health insurance costs add $1,525 to the price of every GM car made in the U.S. If the same car is made in Canada, health care costs add only $197 to each car. In fact Warren Buffett has said that GM is no longer an automobile manufacturer but rather a health benefits company that happens to make cars.

It is encouraging that President-elect Obama feels strongly that health care reform should be a national priority. However, his proposals for reform are piecemeal modifications of the existing dysfunctional systems. Similar reforms have failed to control costs or improve access when tried in several different states.

In conclusion, it is time for the United States to join the rest of the world and ensure universal health care. Having the government fund the program is the most just, equitable and practical solution.

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Dr. David L. Brown is chief of cardiology at Stony Brook University Medical Center. The opinions of columnists are their own. They do not speak for the newspaper.

Kaiser Daily Health Policy Report
Capitol Hill Watch
Apr 24, 2009

On Thursday, witnesses at a House Education and Labor Health, Employment, Labor and Pensions Subcommittee hearing discussed strategies to curb rising health care costs while extending health insurance to more U.S. residents, CQ HealthBeat reports. Health care reform approaches discussed at the hearing include a single-payer health care system; a “employee benefit cooperative” system in which small employers, employees and families band together to purchase coverage; a national health insurance exchange; Medicaid expansion; and changes to the current model of employer-based plans to make coverage more affordable.

David Himmelstein, a primary care physician and associate professor of medicine at Harvard University, advocated a single-payer system (Norman, CQ HealthBeat, 4/23). Himmelstein said that he thinks a health reform modeled after the 2006 Massachusetts health insurance law “will fail” because it is “economically not viable.” According to Himmelstein, the Massachusetts law has “no means of cost containment” because the state is “increasing coverage … by buying additional insurance from (private insurers) on top of already high costs” (Wayne, CQ Today, 4/23). He added, “While reforms that maintain a major role for private insurers may be politically attractive, they are economically and medically nonsensical.”

Subcommittee Chair Robert Andrews (D-N.J.) called the discussion a “dynamic interchange” and a starting point for addressing how to provide quality insurance to all U.S. residents. Rep. John Kline (R-Minn.) said, “There is obviously a great deal of disagreement and diversity here… we’ve got a long way to go here” (CQ HealthBeat, 4/23).

By INGRID PERITZ
Globe and Mail
April 23, 2009

MONTREAL — The patient sat in the clinic’s waiting room, apparently dead, yet even that wasn’t enough to get him medical attention.

In a scene that combined tragedy with Monty Python farce, a 77-year-old man in acute respiratory failure turned up at a private medical clinic in Montreal only to be told to wait his turn.

Jean-Jacques Sauvageau waited until his heart stopped and his dentures fell out onto the floor. Even then, the famous doctor who came to tend to him did a cursory exam and didn’t try to revive him, leaving him instead before the horrified eyes of fellow patients.

The events were depicted in a report issued yesterday by Quebec coroner Catherine Rudel-Tessier. And the doctor taken to task for his failure to try to resuscitate the patient is private-care crusader Jacques Chaoulli.

In 2005, he made history by persuading the Supreme Court to overturn Quebec’s ban on private health insurance.

In this case, Dr. Chaoulli was on duty at a private clinic last year when Mr. Sauvageau showed up. His face was bluish-purple and he had severe trouble breathing. Though the clinic advertised itself as providing emergency care, he was told to take a seat.

After about a half hour, the increasingly alarmed fellow patients could see Mr. Sauvageau was unconscious and alerted the receptionist. Dr. Chaoulli came out, did a cursory examination and concluded the patient was already dead.

He left him sitting in the chair, and told the nurse to phone 911 to report the death.

But the 911 operator pleaded with the nurse to try to revive Mr. Sauvageau. Dr. Chaoulli got on the phone and tried to argue the patient was dead; however, the 911 operator insisted.

Meanwhile, the other patients grew increasingly alarmed, seeing the apparently dead man, his mouth and eyes wide open. Sarah Twain-Lagarde, in the clinic with her feverish toddler, called 911 herself and tried to resuscitate Mr. Sauvageau, but nurses told her to stop.

Eventually, ambulance medics arrived and tried in vain to revive the patient.

An autopsy later revealed that Mr. Sauvageau died of a pulmonary embolism and would not have survived anyway. But the coroner said that Dr. Chaoulli had no way of knowing that, and should have tried to perform CPR.

“[Mr. Sauvageau] had been alive just a few minutes earlier. Suddenly, he loses consciousness and his pulse stops. You have to throw yourself on him and get everything going again, and that wasn’t done,” Ms. Rudel-Tessier said in an interview. “[Dr. Chaoulli] should have done so.”

The coroner urged Quebec’s College of Physicians to write guidelines so private health clinics provide a safe environment for patients. She also urged the college to probe the quality of medical care given to Mr. Sauvageau.

By Chris Doherty
Deseret News
Friday, April 24, 2009

Let me begin by stating that I believe that neither the Canadian nor the U.S. health-care system is perfect, and both could be improved. Some Canadians in need of elective procedures are said to have to wait to see a specialist for their medical conditions in Canada. I, personally, had an appointment last week with a specialist here whom I had been waiting 16 weeks to see, because he is one of a small group of providers “approved” by my insurance. Waits can occur on either side of the border.

But my wait had an end to it. Some 48 million people will have no end to medical problems they are experiencing. Imagine having a migraine that had no end to it or a painful urological condition that continued indefinitely. Imagine if you had a suspicious mole and no way to know if it was cancer or not. That is the state of 48 million Americans, through no fault of their own.

Granted, there may be some who just thought they would save a buck or two and made an unwise decision. Those who willingly run the unnecessary risk may pay, and pay dearly, for their mistake. The rest are a group of people who are excluded from health care in this country. They are those who have either been priced out of the private insurance market, or have pre-existing conditions. In America, you are safe, as long as your medical conditions don’t prevent you from working for an existing company with benefits, you don’t get laid off and you don’t want to start your own company. Then you will continue to be covered.

Otherwise, you may want to consider moving to Canada, where health care is not just offered to the healthy or wealthy. Unfortunately, however, you still run the risk of bankruptcy, since medical bills contribute to half of all personal bankruptcies in this country, and three-fourths of those bankrupted have health insurance at the time they get sick or injured.

Consider what two peer-reviewed medical journals have published on the subject. First, from the Journal of the American Medical Association, “Proposal of the Physicians Working Group for Single-Payer National Health Insurance,” where we are told that “the United States spends more than twice as much on health care as the average of other developed nations,” and “the United States alone treats health care as a commodity distributed according to the ability to pay rather than as a social service to be distributed according to medical need.” From the New England Journal of Medicine, “A large sum might be saved in the United States if administrative costs could be trimmed by implementing a Canadian-style health-care system.”

The Physicians Proposal, published in the Journal of the American Medical Association, is available at www.pnhp.org. It is a proposal put together by responsible physicians who advocate an expanded and improved version of traditional Medicare. According to the proposal, “the world’s richest health-care system is unable to ensure basics like prenatal care and immunizations, and we trail the developed world on such indicators as infant mortality and life expectancy.”

In life expectancy, we are 29th, right behind Bosnia. People largely misunderstand this statistic. They think that Americans may live a few years less than the rest of the developed world. That is not what this statistic represents, since once people in this country reach that magical age of 65, they are eligible for universal care, in the form of Medicare. What skews this statistic are the unnecessary deaths of Americans before 65. This is what causes the average life expectancy to drop.

Our country discovered much of the medical knowledge that the rest of the world enjoys. Why, then, are we exporting these discoveries and trailing the rest of the developed world?

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Chris Doherty, a multiple sclerosis patient, lives in Bountiful.

By Timothy Noah
Slate
Wednesday, April 22, 2009

On April 21, the Senate Finance Committee held the first of three planned hearings on health care reform. The focus was on improving the efficiency of health care “delivery systems”–i.e., hospitals and doctors. It’s an important issue, but not one that’s likely to be the primary focus of the health care reform bill, which will probably have more to do with reforming health insurance. For this reason, the hearing didn’t get much press coverage, and what few stories there were groped around for an angle. I groped a little myself before deciding not to write anything. A day later, though, I changed my mind and decided that the hearing had generated a kind of Zen-riddle news–not about the witnesses who appeared, but rather about a witness who, on reflection, seemed conspicuous for his absence.

The hearing was, I suspect, a sop to Sen. Charles Grassley, R-Iowa, the committee’s ranking member. Grassley spoke with greater urgency than Sen. Max Baucus D-Mont., the committee chairman, about reforming delivery systems. (Click here for Grassley’s opening statement and here for Baucus’.) “How do we make sure that we’re really tackling delivery reform?” Grassley asked. There was a lot of talk about the need to reform or eliminate the “fee-for-service” model, which pays doctors and hospitals based on the number of procedures performed rather than on outcomes; about the need to collect information on best practices and to alter treatments accordingly; and, especially, about the need to increase computerization of medical records (this last should be greatly accelerated by the stimulus bill’s allocation of $21 billion to hospitals and doctors for information technology).

The 13 witnesses were chosen for their expertise on these topics. Particular deference was granted to Glenn Steele, president and chief executive officer of Geisinger Health System, which employs about 800 doctors in rural Pennsylvania. Geisinger is seen as an innovator in streamlining health care. The company imposes a single charge for treating particular illnesses, integrating physician and hospital fees into what it terms a “warranty.” It has standardized treatments for the most common chronic diseases according to “consensus-based best practices,” and it invested early and aggressively in computerized patient records. Also present was Paul Diaz, president and chief executive officer of Kindred Healthcare, the largest provider of long-term health care in the country, who is a strong advocate for shifting more medical care into home settings. There were representatives from the American Hospital Association, the American College of Physicians, and (representing patients) the National Partnership for Women and Families. Mark McClellan, who ran the Medicare and Medicaid programs under President George W. Bush, was there. So was Glenn Hackbarth, chairman of the Medicare Payment Advisory Commission, an agency that advises Congress about the Medicare program.

Who wasn’t there? Eric Shinseki.

Shinseki was the Army chief of staff who effectively ended his career when, prior to the Iraq war, he testified before the Senate Armed Services Committee that the postwar occupation would require several hundred thousand troops. This estimate, which proved accurate, was deemed scandalously disloyal at the time by Defense Secretary Donald Rumsfeld and Deputy Defense Secretary Paul Wolfowitz, who were lowballing the official estimate at 100,000. What does all this have to do with health care reform? Absolutely nothing. But President Obama rewarded Shinseki’s truth-telling by appointing him secretary of veterans affairs, and the Senate confirmed him on Obama’s first day in office. If you still don’t know what this has to do with health care reform, then I urge you to read Best Care Anywhere, Phillip Longman’s indispensable 2007 account of how the Veterans Administration turned itself into the country’s pre-eminent health care delivery system. (Full disclosure: I wrote the book’s forward. I received no money for doing so, and will receive none if you purchase a copy.) Or you can read the 2005 Washington Monthly article on which the book was based or the column I wrote when Longman’s article first appeared, or The Next Progressive Era, a book Longman just published (with Ray Boshara) that includes a summary of the arguments put forth in Best Care Anywhere.

Phil and I have publicized this story repeatedly because no one else seems willing to–no one, that is, except for experts on medical economics, to whom the VA’s superiority to other health care delivery systems is boringly old news. The general public doesn’t know about it because nonexperts harbor a deep resistance to believing it. This stems in part from confusion over the well-publicized scandals involving Walter Reed Army Medical Center, which even many Washington policy jocks think (mistakenly) is part of the VA hospital system. (It isn’t. As the name implies, Walter Reed is run by the Army.) It also stems from a conviction that has seeped deep into the political culture that anything run by the federal government must be inferior to market-based alternatives. The Obama administration and Congress are utterly terrified that in crafting health care reform they will run afoul of this infantile prejudice. They will therefore move heaven and earth to avoid acknowledging the VA’s pioneering use of computerized medical records, its avoidance of the justly lamented fee-for-service model (VA physicians are salaried), and the efficiencies it realizes by treating patients over the long term. The implications of this success are too terrifyingly pinko. The VA is, after all, a system in which the role of insurer, physician, and hospital are all assumed by the U.S. government. The Bush administration did its patriotic best to diminish the VA’s record of success by withholding necessary funding and vastly expanding its use of private contractors, an experiment that, according to a recent article by Tara McKelvey in The Nation, is off to an unpromising start. But the VA’s own doctors and hospitals continue to provide a distressingly positive model for health care reform.

Baucus and his staff recently met privately with experts from the VA to learn about these achievements, but he isn’t about to put any of these folks in front of a TV camera. The rationale for excluding the VA from the hearing was that because it is run separately from the rest of the health care system, the VA probably won’t be affected by any delivery-system reforms Congress enacts. But that’s absurd. The hearing was an attempt to seek out models for reform. The VA hospitals represent the most successful large-scale reform in the delivery of health care that this country has seen in decades. But–shhhhh!–let’s keep that between you and me. I’ve probably said too much already.