PNHP

Sen. McCain's Guaranteed Access Plan

Sen. McCain's Guaranteed Access Plan

Remarks By John McCain On Health Care On Day Two Of The "Call To Action Tour"

www.JohnMcCain.com
Lee Moffitt Cancer Center & Research Institute, Tampa, FL
April 29, 2008

As President, I will meet with the governors to solicit their ideas about a best practice model that states can follow — a Guaranteed Access Plan or GAP that would reflect the best experience of the states. I will work with Congress, the governors, and industry to make sure that it is funded adequately and has the right incentives to reduce costs such as disease management, individual case management, and health and wellness programs. These programs reach out to people who are at risk for different diseases and chronic conditions and provide them with nurse care managers to make sure they receive the proper care and avoid unnecessary treatments and emergency room visits. The details of a Guaranteed Access Plan will be worked out with the collaboration and consent of the states. But, conceptually, federal assistance could be provided to a nonprofit GAP that operated under the direction of a board that included all stakeholders groups — legislators, insurers, business and medical community representatives, and, most importantly, patients. The board would contract with insurers to cover patients who have been denied insurance and could join with other state plans to enlarge pools and lower overhead costs. There would be reasonable limits on premiums, and assistance would be available for Americans below a certain income level.

This cooperation among states in the purchase of insurance would also be a crucial step in ridding the market of both needless and costly regulations, and the dominance in the market of only a few insurance companies. Right now, there is a different health insurance market for every state. Each one has its own rules and restrictions, and often guarantees inadequate competition among insurance companies. Often these circumstances prevent the best companies, with the best plans and lowest prices, from making their product available to any American who wants it. We need to break down these barriers to competition, innovation and excellence, with the goal of establishing a national market to make the best practices and lowest prices available to every person in every state.

http://www.johnmccain.com/Informing/News/Speeches/2c3cfa3a-748e-4121-84db-28995cf367da.htm

Comment:

By Don McCanne, MD

This speech was promoted as a major policy address that would flesh out Sen. McCain’s proposal for health care reform, according to his campaign spokesman Jeff Sadosky. Until now, the only real substance of his proposal was to offer a tax credit, $2500 for individuals and $5000 for families, to purchase health plans in a competitive, deregulated private insurance market. Most of the rest of his proposal is simply rhetorical fluff.

What would appear to be new is his proposal for a Guaranteed Access Plan (GAP). He would establish nonprofit GAPs with stakeholder boards that would provide oversight “in ridding the market of both needless and costly regulations.” Unfortunately, those needless and costly regulations have not been adequate to prevent the explosion in the growth of underinsurance products that currently are exposing insured individuals to unaffordable out-of-pocket expenses for health care. By further reducing regulatory oversight, his proposal would make health care access even less affordable for the majority of Americans.

All of the candidates have been guilty of promoting rhetorical fluff as if it provided the substantial, effective policy reform that we desperately need. This includes measures such as electronic medical records, integrated information technology, disease management, wellness programs, tort reform, innovative payment systems, nebulous administrative efficiencies, and so forth. Some of these policies, if properly structured, might have a beneficial impact on our health care system, but none of them seriously address the two crippling problems in health care today: failing to provide everyone with access to comprehensive health care services, and failing to make that health care affordable for each individual with needs.

The proposals of Sen. Clinton and Sen. Obama fall far short of making health care affordable for everyone, and, as a result, would leave many without access to the care that they need simply because of the financial barriers to care. With continued excessive escalation of health care costs, their proposals would likely result in further deterioration of affordability and access.

In contrast, Sen. McCain would free up the market to allow private insurers to create plans with premiums that we can afford. The only tradeoff is that we’ll have to pay out-of-pocket for most of the health care that we might need.

Side-by-Side Comparison of the Candidates' Positions on Health Care

Kaiser Family Foundation

This side-by-side comparison of the candidates’ positions on health care was prepared by the Kaiser Family Foundation with the assistance of Health Policy Alternatives, Inc. and is based on information appearing on the candidates’ websites as supplemented by information from candidate speeches, the campaign debates and news reports. The sources of information are identified for each candidate’s summary (with links to the Internet). The comparison highlights information on the candidates’ positions related to access to health care coverage, cost containment, improving the quality of care and financing. Information will be updated regularly as the campaign unfolds.

Side-by-side comparison of the candidates’ positions

Website: www.health08.org/sidebyside.cfm

Sen. McCain’s Guaranteed Access Plan

Remarks By John McCain On Health Care On Day Two Of The “Call To Action Tour”

www.JohnMcCain.com
Lee Moffitt Cancer Center & Research Institute, Tampa, FL
April 29, 2008

As President, I will meet with the governors to solicit their ideas about a best practice model that states can follow — a Guaranteed Access Plan or GAP that would reflect the best experience of the states. I will work with Congress, the governors, and industry to make sure that it is funded adequately and has the right incentives to reduce costs such as disease management, individual case management, and health and wellness programs. These programs reach out to people who are at risk for different diseases and chronic conditions and provide them with nurse care managers to make sure they receive the proper care and avoid unnecessary treatments and emergency room visits. The details of a Guaranteed Access Plan will be worked out with the collaboration and consent of the states. But, conceptually, federal assistance could be provided to a nonprofit GAP that operated under the direction of a board that included all stakeholders groups — legislators, insurers, business and medical community representatives, and, most importantly, patients. The board would contract with insurers to cover patients who have been denied insurance and could join with other state plans to enlarge pools and lower overhead costs. There would be reasonable limits on premiums, and assistance would be available for Americans below a certain income level.

This cooperation among states in the purchase of insurance would also be a crucial step in ridding the market of both needless and costly regulations, and the dominance in the market of only a few insurance companies. Right now, there is a different health insurance market for every state. Each one has its own rules and restrictions, and often guarantees inadequate competition among insurance companies. Often these circumstances prevent the best companies, with the best plans and lowest prices, from making their product available to any American who wants it. We need to break down these barriers to competition, innovation and excellence, with the goal of establishing a national market to make the best practices and lowest prices available to every person in every state.

http://www.johnmccain.com/Informing/News/Speeches/2c3cfa3a-748e-4121-84db-28995cf367da.htm

Comment:

By Don McCanne, MD

This speech was promoted as a major policy address that would flesh out Sen. McCain’s proposal for health care reform, according to his campaign spokesman Jeff Sadosky. Until now, the only real substance of his proposal was to offer a tax credit, $2500 for individuals and $5000 for families, to purchase health plans in a competitive, deregulated private insurance market. Most of the rest of his proposal is simply rhetorical fluff.

What would appear to be new is his proposal for a Guaranteed Access Plan (GAP). He would establish nonprofit GAPs with stakeholder boards that would provide oversight “in ridding the market of both needless and costly regulations.” Unfortunately, those needless and costly regulations have not been adequate to prevent the explosion in the growth of underinsurance products that currently are exposing insured individuals to unaffordable out-of-pocket expenses for health care. By further reducing regulatory oversight, his proposal would make health care access even less affordable for the majority of Americans.

All of the candidates have been guilty of promoting rhetorical fluff as if it provided the substantial, effective policy reform that we desperately need. This includes measures such as electronic medical records, integrated information technology, disease management, wellness programs, tort reform, innovative payment systems, nebulous administrative efficiencies, and so forth. Some of these policies, if properly structured, might have a beneficial impact on our health care system, but none of them seriously address the two crippling problems in health care today: failing to provide everyone with access to comprehensive health care services, and failing to make that health care affordable for each individual with needs.

The proposals of Sen. Clinton and Sen. Obama fall far short of making health care affordable for everyone, and, as a result, would leave many without access to the care that they need simply because of the financial barriers to care. With continued excessive escalation of health care costs, their proposals would likely result in further deterioration of affordability and access.

In contrast, Sen. McCain would free up the market to allow private insurers to create plans with premiums that we can afford. The only tradeoff is that we’ll have to pay out-of-pocket for most of the health care that we might need.

Side-by-Side Comparison of the Candidates’ Positions on Health Care

Kaiser Family Foundation

This side-by-side comparison of the candidates’ positions on health care was prepared by the Kaiser Family Foundation with the assistance of Health Policy Alternatives, Inc. and is based on information appearing on the candidates’ websites as supplemented by information from candidate speeches, the campaign debates and news reports. The sources of information are identified for each candidate’s summary (with links to the Internet). The comparison highlights information on the candidates’ positions related to access to health care coverage, cost containment, improving the quality of care and financing. Information will be updated regularly as the campaign unfolds.

Side-by-side comparison of the candidates’ positions

Website: www.health08.org/sidebyside.cfm

Is LipiScan a gizmo?

Scanner to Find Fatty Deposits in Vessels Is Approved

By Barnaby Feder
The New York Times
April 26, 2008

Federal regulators have approved the sale of a new laser scanning system intended to locate fatty deposits in blood vessel walls that are thought to cause heart attacks.

Lipid pools may be anywhere in an artery wall, not just where a blockage has formed from the buildup of plaque. Researchers are unsure whether stenting the pools might reduce heart attack risk, but many believe that inadvertently covering only part of a pool probably increases the risk of rupture.

But some researchers say the whole concept of trying to find and treat lipid pools with devices is a waste of time and money. The pools, they say, are a symptom of arterial disease that affects all of the heart’s arteries and indeed the whole circulatory system. They favor efforts to use drugs and lifestyle changes to reduce concentrations of the potentially dangerous lipids throughout the body.

InfraRdDx said its catheter, which emits near-infrared laser light inside the artery and forms an image from how much is absorbed, could produce a fuller picture of the contents and dimensions of lipids in the vessel walls. The company’s product, the LipiScan Coronary Imaging System, consists of a $150,000 computer console that analyzes and displays the data gathered by the LipiScan laser catheter, which costs $2,400 and can be used only once.

http://www.nytimes.com/2008/04/26/business/26plaque.html?scp=1&sq=LipiScan&st=nyt

And…

Gizmo Idolatry

By Bruce Leff, M.D. and Thomas E. Finucane, M.D.
JAMA
April 16, 2008

That utilization varies widely by region for several devices and procedures, with no better clinical outcomes in high-use regions, provides strong indirect evidence that gizmo idolatry exists and affects clinical practice.

Common Sense Appeal

Many gizmos make so much sense, in the absence of evidence or even the presence of evidence to the contrary, that their value or utility is persuasive prima facie. For example, if coronary artery occlusion causes myocardial infarction, opening the occlusions postinfarction makes sense. If coronary artery bypass graft surgery has significant morbidity and mortality, perhaps stents are the solution. If bare metal stents develop thrombosis, drug-eluting stents can reasonably be expected to be better. The above reasoning proceeds despite evidence that angiographically defined coronary stenosis is a poor predictor of subsequent occlusion and infarction in patients with stable angina. The face value and common sense appeal of such interventions contribute to their widespread diffusion, more rapidly than evidence alone could justify.

What to Do?

In the medical marketplace, some combination of avarice, hucksterism, credulity, genuine need, and gizmo idolatry impart considerable momentum to the early and unconsidered use of many unproven technologies. A multitiered strategy will be required to combat this phenomenon. Recognition of gizmo idolatry is a critical first step in educating consumers, both clinicians and patients, to be circumspect rather than enthusiastic and to seek evidence about the effectiveness of any medical technology. Tort reform may help reduce defensive medicineĆ¢ā‚¬ā€œinduced gizmo idolatry. Wennberg et al have proposed reforms to the Medicare system to reduce, among other things, the use of supply sensitive services, sometimes a manifestation of gizmo idolatry. Their proposal includes (1) promoting health care organizational structures that foster effective care delivery, (2) detailed strategies to improve the quality of patient-physician decisions regarding treatments in which patient preference should play a role, (3) the promotion of more conservative practice styles, and (4) the establishment of Comprehensive Centers for Medical Excellence to implement these changes.

Conclusion

Gizmo idolatry describes the willingness to accept, in fact to prefer, unproven, technologically oriented medical measures. Several forces contribute to and encourage this tendency. Great burdens may result. Clinicians, patients, payers, and policy makers should be mindful of the urge to use gizmos. Purveyors should proceed responsibly, limiting promotional efforts until data about meaningful benefit to patients are developed. Payers should be stringent in their decisions to cover expensive and unproven treatments. Clinicians and patients should resist the clamor for the new and fancy. Finally, all stakeholders should encourage and reward diligent bedside care for all who need it.

http://jama.ama-assn.org/cgi/content/full/299/15/1830

<3>Comment:

By Don McCanne, MD

Think of how often a medical technology firm has suggested simple, inexpensive clinical management of a condition that would obviate the need to use their very expensive technology. Never? Yet those supporting market financing of our health care system insist that it encourages technological advances which provide higher quality care at lower costs. What we are receiving instead is much more expensive care, often of dubious value.

Technological firms develop products with the primary goal of making a lot of money – a whole lot of money. Their intention is that the results of their research would provide them with products that provide significant benefit to patients. That may not always turn out to be true, but if they can just get their products on the market then they can hope that the “common sense of gizmo idolatry” will drive the success of their innovations.

Other nations place limits on gizmo medicine while encouraging clearly beneficial high-tech services. Opponents of reform frequently criticize these limits as “government rationing” of health care. But is it really rationing to decline to pay for expensive interventions with highly dubious, unproven benefit? Whether paying a premium to an insurance company or paying a tax to a public insurance program, most of us would not want our funds wasted on these often detrimental excesses.

Remember that Antonio Egas Moniz received the Nobel Prize in 1949 for developing the leucotome – a retractable wire loop gizmo that cut the frontal lobes off of the brain. In our enlightened age, we should demand more than gizmos from the technology firms. If we had a national health program, we would have control of what the firms seek – the money to pay for their gizmos. Then maybe they would get it right.

Doctors agree: We need single-payer health care

It's the only system that offers affordable quality care

By LEONARD A. ZWELLING and ANA MALINOW
Houston Chronicle
April 26, 2008

We have all heard it before. The health care system in the United States is broken. We have all heard it, but when is someone going to do something about it?

Physicians for a National Health Program (PNHP) is a group of 15,000 physicians who believe that there is a solution and it is currently working for Americans — if they are over 65. It is, of course, Medicare, part of the 60 percent of our current health care system that is paid for and administered by the government.

We believe a single-payer system (Medicare for everyone) would be less costly, more efficient and provide all Americans with the health care they need without an increase in overall dollars spent (an amount that is increasing at a rate of 7 percent per year). This would include the 47 million who are currently uninsured and the estimated 50.3 million who are “underinsured” (spending 10 percent or more of their pretax income on health care).

Until now, doctors who believed in a system of guaranteed single-payer health care were in the minority. However, in a new study from Indiana University published in The Annals of Internal Medicine, 59 percent of the physicians support national health insurance.

This is a 10 percentage point increase from the same survey done 5 years ago. In fact, there are increases in support among doctors in every medical specialty. We expect that physician support for single-payer national health insurance will continue to grow. Recently the American College of Physicians endorsed a single-payer system.

Our group, the Physicians for a National Health Program, applauds the new findings. We are thrilled that the majority of our colleagues believe, as we do, that the solution to the health care crisis is a single-payer system.

Most of us now recognize that the huge administrative burden placed on physicians and their office staffs to comply with the mandates of the insurance industry, and the tremendous profits garnered by these companies at everyone’s expense (rising premiums), have nothing to do with quality health care or access to it.

In Texas alone it has been estimated that we waste $98 billion on administrative health care costs. Administrative costs constitute 31 percent of health care expenditures — and don’t make anyone feel better except the insurance company stockholders.

So, of course, the presidential candidates are proposing these same cost-effective plans, right? Wrong. None of the three remaining candidates has a health plan that matches what the majority of physician providers think would be best for their patients or their practices.

The McCain free-market plan has failed; health care is not a commodity subject to the laws of supply and demand. The Clinton and Obama mandate plans would make everyone buy insurance and criminalize those who do not. Such plans have failed repeatedly in the past and a mandate plan is failing in Massachusetts now.

Incremental plans will not work. Free market plans will not work. Mandates will not work. Only a single-payer system, free of the private insurance industry, will provide care to everyone and reduce overhead and administrative costs.

Only single-payer national health insurance, “improved and expanded Medicare for all,” can provide Americans with a level of care equal to that currently available in most industrialized nations.

The doctors have spoken. What about you? This election year, demand a system that provides Americans the health care they deserve: single-payer, national health insurance.

Zwelling and Malinow are both members of PNHP. Malinow, an assistant professor of pediatrics at Baylor College of Medicine, is the current PNHP president.

The French Health Care System

by Jean-Francois Briere

The French health care system was rated the best in the world by the World Health Organization in 2001. The American health care system ranked 37th. In 2004, France spent 10.5% of its gross domestic product on health while the U.S. spent 15.4%. Again, in 2004, the last year for which figures are available, the per capita total expenditure on health in U.S. dollars was $3,464 in France but $6,096 in the U.S. Analyzing the French system might provide some ideas for a solution to the current health care crisis in America. We need to start with an understanding of how the French system works.

France does not have socialized medicine. Socialized medicine is a system where all physicians and medical personnel are employed by the government and medical care is free. In such a system, health insurance does not exist because it is not necessary. Communist countries have socialized medicine and in the United States such a system exists on a limited scale for the military and for veterans.

The main difference between the French and the American health care systems is not in the way medical care is delivered. Both systems are actually fairly similar in this regard. Most physicians in France are independent providers who have a private practice like here. You can find both public and for-profit private clinics/hospitals in France like here. Pharmacies in France are private businesses like here. The main difference lies in the way the financing of the system is structured. France has a non-profit national health insurance system (administered by the Social Security administration) with mandatory coverage for anyone who resides for more than 3 months in the country. Health care insurance is not directly managed by the government but by an autonomous authority made up of representatives of employers, unions and the government. It is in many ways analogous to how Medicare is funded and managed in the United States. The system is financed mainly by mandatory contributions by employers and employees, or on taxable income for non-salaried persons. Contributions are a percentage of income, not a flat amount. This makes universal coverage feasible because nobody is in a position where they cannot afford health insurance. Currently, employers pay 12.8 % of salary to cover their employees. Employees pay a Social Security tax of 7.5% of salary, but this tax (called CSG) covers not only health care insurance but also includes other benefits like disability insurance. Households earning less than $9,600 per year do not pay any contribution. College students pay a flat amount (about $200 per year.) If you go to France, you cannot obtain a residence permit without first showing that you have registered for national health insurance.

The Social Security administration negotiates all medical fees with national unions and organizations of medical providers. The vast majority of physicians agree to follow the Social Security fee scale: they are called “medecins conventionnes” (physicians under contract). If these physicians under contract charge in excess of the established fee schedule, they must return the excess income to Social Security. A small number of physicians do not accept the Social Security fee scale and set their own fees. They see a small clientele of (wealthy) patients. Health care fees for similar services offered by similar categories of physicians in the same area of France are the same. Competition does exist among physicians and among hospitals, but it is about the quality of medical care, not its price. Unlike people stuck in a mandated provider network in the U.S., French patients can see any physician in the country. In this way, France is like a gigantic preferred provider network under contract with a single insurer. Physicians’ incomes in France are comfortable, but not as high as they are in certain specialties, or in certain geographical areas, in the US. Medical schools in France are public institutions and are almost tuition-free. As a result, physicians do not have to pay back huge student loans.

The French health care system does not usually cover 100% of medical fees, but rather a specific percentage depending on the kind of service, or the kind of medication. Commonly prescribed, cheap medications may be reimbursed at 50% of cost. Expensive life-saving ones, for cancer for instance, would be reimbursed at 100%. In 2008, the cost of a visit to a physician is 23 euros (about $34.50 given current exchange rates). It is covered at 70% ($24.15). Patients have to pay 30% ($10.35) from their own pocket. Most people have private insurance coverage for these non-covered balances, usually through unions or non-profit insurance companies where the insurance premiums are highly regulated. Since 2006, patients have been required to see a primary care physician before going to see a specialist, and there is a mandatory co-pay of 1 euro ($1.50) per visit which by law cannot be covered by Social Security or by private insurance. However, the total co-pay amount per year is capped at 50 euros per person ($75). It works much the same way if one is hospitalized: health care charges are covered at 100%, but patients must pay a 16 euro ($24) “hospitality” charge per day, which is usually covered by private insurance. In theory, you are supposed to pay physicians’ charges or medication costs out of pocket and seek reimbursement later. In practice, however, everyone has personal Social Security cards (called “cartes vitales”) containing an electronic chip with personal information which can link directly to the central Social Security computers and automatically credit the reimbursement to the physician’s or the pharmacy’s account. Many French physicians’ offices have only one secretary and sometimes none, because the administrative requirements are so minimal and can be so easily and efficiently handled. Prescription drug prices are controlled by the Social Security administration. The same medication often costs 30% to 50% less in France than in the U.S. French law bans all health care advertising to the general public. Drug companies may promote new products only to physicians, not patients.

Surveys show that the French are generally satisfied with their health care system. It combines universal access to care with a high degree of freedom for patients. While it is not perfect, it provides a model worth emulating.

Jean-Francois Briere is a member of the Steering Committee of the Capital District Alliance for Universal Healthcare and Assistant Professor of French Studies at the University at Albany/SUNY. CDAUH thanks him for taking the time to write this article especially for this newsletter.

Politicians limited in health debate

Dr. Bill Davidson Jr.
North Annville
Lebanon Daily News, PA

With health care the leading domestic issue facing our country today, one would have expected the leading presidential candidates to have presented the nation with serious, viable solutions. Unfortunately, none has been willing to look at this issue without the lens of party ideology or special-interest politics, and as a result the American people are unlikely to see any relief from soaring health-care costs, a million annual bankruptcies, 47 million uninsured and less-than-anticipated medical-quality outcomes.

John McCain, on the occasions when he acknowledges that there is a health-care problem, asks our electorate to let the “invisible hand” of the free market work its magic on our health care system. The fact that it is the “free market” that has brought us to our present state of distress doesn’t deter him from advocating for health savings accounts, consumer-directed health care and other investment-industry solutions that only deepen the problem. Just as the best physicians are not necessarily the most rewarded financially, health care is a social good and requires a mixture of financial incentives and true American compassion.

The Democrats have also let us down by allowing the financial interests of the insurance and pharmaceutical industries to narrow our options for solutions. Neither Sen. Barack Obama nor Sen. Hillary Clinton has been willing to divest themselves of the campaign support of these industries. They have, therefore, presented Americans with very flawed solutions.

Clinton’s plan of individual mandates will force people to buy health-care insurance even to the point of jail or attachment of wages for those who refuse. Obama’s solution is less confrontational but keeps the same old players in place, and so we can expect little real change of substance.

Obama tells us he personally prefers a Canadian-styled single-payer system but doesn’t feel most Americans are ready to give up our present system based on private insurance. With 65 percent of Americans favoring a universal, government-financed system (CNN Poll, May 2007) one has to ask to whom he is listening — ordinary citizens or lobbyists who represent the drug and insurance industries? Only a universal, single-payer system can deliver quality health care for all Americans at an affordable price.

Eventually, such a system, enjoyed by most of the industrialized world, will come to pass here. It seems a shame that so much suffering has to take place before our politicians can feel empowered enough to take on the special-interest groups that stand in the way.

Providing health care for all shouldn't make insurers rich

By Milton Fisk and Kay Mueller
Herald-Times
Guest column
April 24, 2008

Government subsidies and outsourcing may be good for business without always being good for the public. Medicare outsources the administration of its prescription drug program, Medicare D, to private insurers. Medicare Advantage — Medicare C — subsidizes managed care insurance plans for seniors choosing them. Several current presidential aspirants — Clinton and Obama — would subsidize the purchase of insurance for the low-income uninsured. Each of these plans offers private insurers protection against a less wasteful plan, one that does without private insurers.

Involving the insurers in the Medicare drug and Advantage plans is a needless drain of Medicare funds.

The drug companies charge much more for the drugs used under Medicare D than they do for the same drugs bought by Medicaid. The law forbids Medicare to negotiate prices of Medicare D drugs with the pharmaceuticals. Medicaid bargains a 30 percent discount on drugs while the insurers running Medicare D bargain only a 5 to 10 percent discount. Medicare C’s Advantage Plan turns over managed care to private insurers, paying them 10 to 12 percent more than Medicare pays for seniors in its regular program.

Suppose one of those presidential aspirants wins. What would the subsidies they want cost? They want subsidies to help at least the poorest two-thirds of the 47 million uninsured buy insurance.

The insurers would be in for a windfall injection — from the government and low-income individuals — of about $150 billion each year. Any industry would love this. But would it serve the public interest?

The answer comes from looking at how to get quality health care to the uninsured for much less. The private insurers operate with enormous overhead. Profit is an essential part of it, since without it, investors turn away.

Then there is marketing, lobbying, paperwork, computer systems, colossal salaries for upper level managers and the expense of constantly merging and reorganizing. In sum, overhead accounts for roughly 25 percent of premium income, while overhead for Medicare is five times less!

The presidential aspirants who promote this kind of insurer protection plan recognize the waste involved. So what is their response? They would make subsidies contingent on reducing overhead. Sen.Clinton’s plan says premiums are not to be dedicated to “excessive profits and marketing.” This might reduce overhead from 25 percent down to 15 or 20 percent of premium income — still three or four times more than Medicare’s overhead. How can anyone stand before the public and say they want to waste billions of taxpayers’ dollars just to protect the insurers?

It is not right to use the uninsured as an excuse for making the insurers richer. We don’t need the insurers to provide the uninsured with health care.

Those proposing insurance protection plans spread the view that we shouldn’t help the uninsured unless the corporations make a buck out of it. Whatever happened to the public interest?

This guest column was written by Milton Fisk and Kay Mueller, who are members of the research committee of Hoosiers for a Commonsense Health Plan. Fisk is also an author of a book on health care reform.

U.S. must look for a health care system to cover everyone

By Robert Stone, M.D.
Bloomington Herald Times
Guest column
April 25, 2008

Nationally, the week of April 27 to May 3 is Cover the Uninsured Week. Locally, many of the 883 GE employees and their families are getting closer every day to becoming uninsured. Since World War II, access to health care in this country has been based on employer-sponsored insurance, but the percentage of workers covered by their employers peaked in 2001 at 65 percent and has been dropping ever since. The projections are that in a very few years less than half of Indiana workers will have coverage through their work. We’ve heard about the problems the auto industry has in paying for health care, but small businesses are feeling it even more, dropping their coverage at an even higher rate. The problem of the uninsured is not just “their” problem, it’s “our” problem. We are all just a layoff, a plant closing or a divorce away from being uninsured.

To make matters worse, we have a new epidemic of under-insurance. From 2000 to 2006, insurance premiums rose 87 percent while earnings increased only 20 percent over that same six-year period. The national average cost is now $1,000 a month for family coverage. While premiums have soared, deductibles and co-pays have gone up, too. In the desperate attempt to find a policy with affordable premiums, the fine print becomes crucial. For example, the official plan offered to Indiana University students has an annual maximum benefit of $75,000 per injury or illness. You can spend that much in one week in the intensive-care unit!

It is becoming clear that our current medical economic situation is unsustainable, with medical costs rising faster than inflation, insurance premiums rising much faster than earnings, while the number of uninsured just keeps rising. We don’t even need to go into the moral dimension of the richest country in the world allowing a rapidly growing number of its people to live under Third World medical conditions.

Taking into account that costs are out of control, how can we possibly contain them? The essence of insurance is that the greatest efficiency is achieved with the largest risk pool. The essence of bargaining for good prices is the use of bulk purchasing. The most cost-effective medical care is preventive care. How can you incorporate all that in one solution? By setting up an all-inclusive system that brings everyone into one big risk pool, in other words, a universal system.

How can we run a universal system in the most cost-effective way? The government will have to be the paymaster. Doctors and hospitals should stay private and independent.

Where is the model that we can use? Our 40-plus years of experience with Medicare. In the mid 1990s, when officials in Taiwan decided that their market-based health insurance system was failing, they looked at the experiences of other countries around the world and ended up with a system very much like our Medicare, but for everyone, not just those over age 65.

Is that socialism? I hardly think so. If Medicare is not socialism for everyone over age 65 right now, why is it socialism if we cover the rest of us? Is it any different from our “socialized” police force or fire department?

Is Medicare perfect? No, but it is a solid foundation to build on. Do you see long lines of seniors waiting outside of doctors’ offices around town? No, waiting lines are not a problem. Do Medicare patients get second-rate care? No, quality is no worse in Medicare than private insurance, and in many ways better.

Cover the uninsured? Aid for the under-insured? And those at risk of losing their insurance? That’s getting to be about everyone under Medicare age. Let’s cover everyone. Medicare for all!

This guest column was written by Robert Stone, M.D., director of Hoosiers for a Commonsense Health Plan, and state coordinator, Indiana chapter, Physicians for a National Health Program.

Providing health care for all shouldn’t make insurers rich

By Milton Fisk and Kay Mueller
Herald-Times
Guest column
April 24, 2008

Government subsidies and outsourcing may be good for business without always being good for the public. Medicare outsources the administration of its prescription drug program, Medicare D, to private insurers. Medicare Advantage — Medicare C — subsidizes managed care insurance plans for seniors choosing them. Several current presidential aspirants — Clinton and Obama — would subsidize the purchase of insurance for the low-income uninsured. Each of these plans offers private insurers protection against a less wasteful plan, one that does without private insurers.

Involving the insurers in the Medicare drug and Advantage plans is a needless drain of Medicare funds.

The drug companies charge much more for the drugs used under Medicare D than they do for the same drugs bought by Medicaid. The law forbids Medicare to negotiate prices of Medicare D drugs with the pharmaceuticals. Medicaid bargains a 30 percent discount on drugs while the insurers running Medicare D bargain only a 5 to 10 percent discount. Medicare C’s Advantage Plan turns over managed care to private insurers, paying them 10 to 12 percent more than Medicare pays for seniors in its regular program.

Suppose one of those presidential aspirants wins. What would the subsidies they want cost? They want subsidies to help at least the poorest two-thirds of the 47 million uninsured buy insurance.

The insurers would be in for a windfall injection — from the government and low-income individuals — of about $150 billion each year. Any industry would love this. But would it serve the public interest?

The answer comes from looking at how to get quality health care to the uninsured for much less. The private insurers operate with enormous overhead. Profit is an essential part of it, since without it, investors turn away.

Then there is marketing, lobbying, paperwork, computer systems, colossal salaries for upper level managers and the expense of constantly merging and reorganizing. In sum, overhead accounts for roughly 25 percent of premium income, while overhead for Medicare is five times less!

The presidential aspirants who promote this kind of insurer protection plan recognize the waste involved. So what is their response? They would make subsidies contingent on reducing overhead. Sen.Clinton’s plan says premiums are not to be dedicated to “excessive profits and marketing.” This might reduce overhead from 25 percent down to 15 or 20 percent of premium income — still three or four times more than Medicare’s overhead. How can anyone stand before the public and say they want to waste billions of taxpayers’ dollars just to protect the insurers?

It is not right to use the uninsured as an excuse for making the insurers richer. We don’t need the insurers to provide the uninsured with health care.

Those proposing insurance protection plans spread the view that we shouldn’t help the uninsured unless the corporations make a buck out of it. Whatever happened to the public interest?

This guest column was written by Milton Fisk and Kay Mueller, who are members of the research committee of Hoosiers for a Commonsense Health Plan. Fisk is also an author of a book on health care reform.

Marcia Angell on relationship between coverage and costs

Health Reform You Shouldn't Believe In

By Marcia Angell
The American Prospect
April 21, 2008

All of these variations in the Democrats’ plans run into this intractable dilemma: If the system stays essentially as it is and we try to expand coverage, costs will inevitably rise. On the other hand, attempts to control costs will inevitably reduce coverage. Without fundamental reform, coverage and costs have to move in the same direction. Yet, we don’t have the option of expanding both coverage and costs. At 16 percent of gross domestic product, our health-care system is already unaffordable. In fact, costs are the central problem; universal health care would be easy if money were no object. Furthermore, none of the proposed reforms offers any workable mechanism for controlling the unsustainable inflation in health costs. Attempts to regulate private insurers to prevent the worst abuses would probably do little more than add to the complexity and administrative costs of the system.

The proposed reforms also make the fundamental mistake of confusing insurance with health care. As many Americans are learning, the two are not the same — not by a long shot. Health insurance can easily be too skimpy or too laden with exceptions and co-charges to be of much use. What people really want when they’re sick is medical care, not medical insurance, just as they want education for their children, not the opportunity to buy education insurance.

The only workable solution is a single-payer system (there, I said it), in which everyone is provided with whatever care he or she needs regardless of age and medical condition. There would no longer be a private insurance industry, which adds little of value yet skims a substantial fraction of the health-care dollar right off the top. Employers, too, would no longer be involved in health care. Care would be provided in nonprofit facilities. The most progressive way to fund such a system would be through an earmarked income tax, which would be more than offset by eliminating premiums and out-of-pocket expenses.

This is not the same as Medicare for all. Medicare is embedded in our market-based entrepreneurial private system, and therefore experiences many of the same inflationary forces, including having to deal with profit-maximizing hospitals and physicians’ groups. Doctors’ fees are skewed to reward highly paid specialists for doing as many expensive tests and procedures as possible. As a result, Medicare inflation is almost as high as inflation in the private sector and similarly unsustainable.

…the private insurance industry has managed to convince many political leaders, including progressives, that a single-payer system is unrealistic. But what is truly unrealistic is anything else. My greatest concern about the Massachusetts plan is that when it unravels, people will draw the wrong lesson. They will assume that universal care at a cost we can afford is impossible, and give up on it. It’s not impossible; it’s just unlikely to be achievable while leaving our dysfunctional system in place. Can we make it right? I’m tempted to say, “Yes, we can.”

http://www.prospect.org/cs/articles?article=health_reform_you_shouldnt_believe_in

Comment:

By Don McCanne, MD

Yes we can!