PNHP

Thomas is the Canary in the Health Care 'Coal Mine'

Thomas is the Canary in the Health Care 'Coal Mine'

Today (January 24) Physicians for a National Health Program and California Nurses Association/National Nurses Organizing Committee held a press conference at the National Press Club in Washington, uniting in a call for national health insurance.

Nathan Wilkes, a computer network engineer from Colorado, provided a few comments at that press conference. He represents the American dream. He has a great family and an excellent job that provides him with the protection of the best that private insurers have to offer. The story of his son, Thomas, should make us question whether the private insurance industry can ever provide the level of protection against medical debt that we all should have. Following are excerpts from an essay that Nathan wrote about their experiences.

Problems with and solutions for the current system of employer-sponsored health care in the United States

By Nathan J. Wilkes
January, 2007

Meet Thomas.

Thomas is only three years old. By most accounts, he is your typical three-year-old — learning his alphabet and numbers, infatuated with Spider-Man, and constantly finding new ways to get in trouble.

But, by fate and circumstance, he is more than that. Thomas is the Canary in the Health Care ‘Coal Mine’.

When Thomas was born in 2003, he was diagnosed with Severe Hemophilia A, a genetic blood-clotting disorder caused by a lack of “Factor VIII” that prevents his body from creating clots when he sustains injury.

In the three years of Thomas’s life, our family has been exposed to the harsh realities of health care in Colorado and the US. Through my experiences with employer-based health care, providers (doctors, hospitals, emergency rooms), insurance companies, advocacy groups, legislative bodies, non-profit groups, and peers in the hemophilia community, I have witnessed first-hand what happens when the fundamental basis of providing health care coverage is deeply flawed and so-called “reform” actions are nothing more than attempts to increase the profits of special interest groups.

I helped build a local high-tech company (Virtela) from the ground up. I am currently the 4th most senior employee based on longevity, and the most senior engineer.

Managing expenses such as health care for employees has not been easy. Because of the risk associated with joining a start-up company, it was imperative that Virtela offer a comprehensive benefits package, including health insurance, stock options, and competitive salaries. As a result, employees enjoyed health insurance with no deductible, no copayments, affordable prescriptions, and reasonable premium expenses.

Over the first several years, we witnessed moderate increases in premium costs. As an employer of about 100 people, we fit into the large-group insurance category. If we didn’t like the premiums we were offered upon renewal, we went to bid and shopped around for competitive insurance rates. As a result, we had three different providers over the first three years, switching to preserve benefits while keeping premium costs down (or at least not rising as fast).

In 2004, we saw modest increases in premiums and greater shift of premium costs onto employees through higher copays.

In early 2004, Thomas developed an inhibitor to his factor replacement therapy. Without going into the details, an inhibitor meant that his body developed an immunological response to the life-saving factor treatments that normally allowed his blood to clot if he had an injury.

When Virtela went to renew its insurance at the end of 2004, it faced an unprecedented dilemma. Because of claims history, we faced a nearly 40% increase in premiums. As a new company struggling to reach profitability, there was no room in the budget for the company to cover the difference. Rather than pass the costs on to the employees, who no doubt couldn’t afford to absorb this increase either, the contract was put out to bid again, like had been done many times before. There was a difference this time. Because of prior claims and a lack of guarantee-issue for large-group coverage, every insurance company refused to bid on our business. United Health Care, thanks to guarantee-renewability, was our only option for insurance and we were stuck with the premiums they dictated.

Virtela then worked with United Health Care and a broker to try and craft an affordable solution. The only solution that fit in the company’s budget was migrating from the original PPO plan to a High Deductible Health Plan. By coupling the HDHP with a Health Savings Account, Virtela was able to pay the premiums for which they had budgeted. The increase was still passed on to the employees, but in the form of HSA contributions that were voluntary. Some employees chose the HSA and struggled to find the budget to fund it. Some employees chose the HSA and didn’t fund it fully because it wasn’t in their budget to do so yet.

In 2005 and 2006, Thomas’s treatment didn’t change much. Claims were about $750,000 for each year. What did change were our benefits. Every other insurance company again refused to bid on our business. At the end of 2005, we faced another premium increase of over 55%. The only way to lessen the burden was to accept some very troublesome changes to the benefits. The out-of-pocket maximum increased from $4,000 to $8,000. Prescriptions after the deductible was met went from 100% coverage to $10-$50 each. Most troubling of all, a $1 million lifetime maximum was introduced. The direct effect of this cap was to weed out high-cost plan participants like my son.

When lifetime capitation was first introduced by the insurance industry in 1970, $1M was a common standard. A $1M lifetime cap in 1970, adjusted for inflation, should be close to $20 million today, yet a $1M cap is still the norm and now woefully inadequate.

In 2006, Thomas’s claims were about $800,000. Premiums for 2007 increased yet again. Benefits were further limited by increasing the deductible from $4,000 to $6,000 and out-of-pocket annual maximum from $8,000 to $10,000 for family coverage. It is now officially impossible for a new employee making maximum allowable contributions to his HSA to match the new deductible in a year’s time.

The introduction of the cap for the 2006 plan started a timer that couldn’t be reversed. By the time we hit the cap, I would have to make a critical decision. In order to not fall into a “pre-existing condition” category with my son’s hemophilia, I would have to find some way to maintain private insurance coverage when the cap was exhausted.

Over the next couple of months following the introduction of the lifetime cap, I searched and searched for a solution.

(He lists six options, each with its own problems.)

7) Change the world. Lobby for single-payer, single-risk-pool, universal-access coverage like that proposed by Physicians for a National Health Plan and many others. This is the only option that addresses the real problems of health care costs, access to care, and social responsibility while remaining fair and making economic sense.

Press release – PNHP and CNA/NNOC:
https://pnhp.org/news/2007/january/physicians_and_nurse.php

Comment:

By Don McCanne, MD

The private insurance model is fundamentally different from a universal, publicly-funded social insurance model. The former works well for the healthy, but not so well for the sick and injured; the latter always works for everyone. When will the nation finally learn this lesson?

Let's skip the gimmicks and enact real reforms

By MERTON C. BERNSTEIN
HEALTH CARE
Special to The Kansas City Star
Published on Wed, Jan. 24, 2007

We have reached a national consensus on health insurance — it costs too much and covers too few. Most “reform” proposals, like California Gov. Arnold Schwarzenegger’s and the health insurance industry’s, camouflage their real costs with tax breaks and other subsidies.

But coverage and cost are not two separate problems. Repeated double-digit cost increases caused coverage of millions to disappear. To cover the uncovered, we must — and we can — make better use of the $2 trillion public and private medical-care programs now expend. Banishing unnecessary nonbenefit costs could generate funds to cover everyone.

It is not reform to make individuals insure themselves. An individual mandate would require establishing and maintaining records just to keep track of compliance; enforcement proceedings against every noncomplying individual; processing requests for exemptions; keeping tabs on those not exempted; and repeatedly updating all these steps.

It is not reform to condition subsidies on poverty. Such tests, which also would require repeated updating, would cost tens of billions when applied to millions of people. That helps explain why means-tested Medicaid costs almost 5 percent more to administer than nonmeans-tested Medicare. Nor is it reform to vary millions of individuals’ subsidies based on the inevitable variations in individual income — at great administrative cost.

These nonreforms only increase costs — massively reducing funds for essentials like vaccination. They pepper the much-heralded Massachusetts and Schwarzenegger health-care plan and the health-care-provider proposal, backed by AARP, to extend coverage. Understandably, that proposal omits to say who will pay.

Permitting physician ownership interests in testing laboratories, imaging facilities, hospitals, nursing homes and pharmacies would provide inducements to prescribe what they sell. Rather than assuming that everyone would resist temptation, medical societies and legislation should shut those cookie jars. That would improve care and reduce costs.

Reform will elude us if the public and policy-makers mistake what needs changing. For example, in a 2006 Kaiser Foundation opinion poll, “too many malpractice suits” tied for second as the largest cause of ballooning health-care costs. Yet analyses show that malpractice premiums and litigating costs constitute just 1 percent of medical-care outlays.

If Medicare covered us all, more of the health-care dollar would go for treatment and prevention. Currently, insurers and providers spend huge amounts to match billions of billings with thousands of private plans and many public programs with differing eligibility and benefit criteria.

Medicare for All would save most of those nonbenefit charges. Some object that savings would be slight because providers must maintain records for treatment. Yes, but that recordkeeping does not require clericals to determine what programs, if any, cover claimants, and if so, what is billable and how much is reimbursable.

To tame costs and extend coverage, we must harvest savings where now we sow and reap inefficiently. The Schwarzenegger and Massachusetts gimmicks and the plan shaped by the same people who designed the perplexing and inefficient Part D — health insurers and AARP — plow other fields. Instead of savings, they increase nonbenefit costs. That’s not reform.

Merton C. Bernstein is a Coles Professor of Law Emeritus at Washington University. He was principal consultant to the National Commission on Social Security Reform and is a founding board member of the National Academy of Social Insurance.

(c) 2007 Kansas City Star and wire service sources. All Rights Reserved.
http://www.kansascity.com

Thomas is the Canary in the Health Care ‘Coal Mine’

Today (January 24) Physicians for a National Health Program and California Nurses Association/National Nurses Organizing Committee held a press conference at the National Press Club in Washington, uniting in a call for national health insurance.

Nathan Wilkes, a computer network engineer from Colorado, provided a few comments at that press conference. He represents the American dream. He has a great family and an excellent job that provides him with the protection of the best that private insurers have to offer. The story of his son, Thomas, should make us question whether the private insurance industry can ever provide the level of protection against medical debt that we all should have. Following are excerpts from an essay that Nathan wrote about their experiences.

Problems with and solutions for the current system of employer-sponsored health care in the United States

By Nathan J. Wilkes
January, 2007

Meet Thomas.

Thomas is only three years old. By most accounts, he is your typical three-year-old — learning his alphabet and numbers, infatuated with Spider-Man, and constantly finding new ways to get in trouble.

But, by fate and circumstance, he is more than that. Thomas is the Canary in the Health Care ‘Coal Mine’.

When Thomas was born in 2003, he was diagnosed with Severe Hemophilia A, a genetic blood-clotting disorder caused by a lack of “Factor VIII” that prevents his body from creating clots when he sustains injury.

In the three years of Thomas’s life, our family has been exposed to the harsh realities of health care in Colorado and the US. Through my experiences with employer-based health care, providers (doctors, hospitals, emergency rooms), insurance companies, advocacy groups, legislative bodies, non-profit groups, and peers in the hemophilia community, I have witnessed first-hand what happens when the fundamental basis of providing health care coverage is deeply flawed and so-called “reform” actions are nothing more than attempts to increase the profits of special interest groups.

I helped build a local high-tech company (Virtela) from the ground up. I am currently the 4th most senior employee based on longevity, and the most senior engineer.

Managing expenses such as health care for employees has not been easy. Because of the risk associated with joining a start-up company, it was imperative that Virtela offer a comprehensive benefits package, including health insurance, stock options, and competitive salaries. As a result, employees enjoyed health insurance with no deductible, no copayments, affordable prescriptions, and reasonable premium expenses.

Over the first several years, we witnessed moderate increases in premium costs. As an employer of about 100 people, we fit into the large-group insurance category. If we didn’t like the premiums we were offered upon renewal, we went to bid and shopped around for competitive insurance rates. As a result, we had three different providers over the first three years, switching to preserve benefits while keeping premium costs down (or at least not rising as fast).

In 2004, we saw modest increases in premiums and greater shift of premium costs onto employees through higher copays.

In early 2004, Thomas developed an inhibitor to his factor replacement therapy. Without going into the details, an inhibitor meant that his body developed an immunological response to the life-saving factor treatments that normally allowed his blood to clot if he had an injury.

When Virtela went to renew its insurance at the end of 2004, it faced an unprecedented dilemma. Because of claims history, we faced a nearly 40% increase in premiums. As a new company struggling to reach profitability, there was no room in the budget for the company to cover the difference. Rather than pass the costs on to the employees, who no doubt couldn’t afford to absorb this increase either, the contract was put out to bid again, like had been done many times before. There was a difference this time. Because of prior claims and a lack of guarantee-issue for large-group coverage, every insurance company refused to bid on our business. United Health Care, thanks to guarantee-renewability, was our only option for insurance and we were stuck with the premiums they dictated.

Virtela then worked with United Health Care and a broker to try and craft an affordable solution. The only solution that fit in the company’s budget was migrating from the original PPO plan to a High Deductible Health Plan. By coupling the HDHP with a Health Savings Account, Virtela was able to pay the premiums for which they had budgeted. The increase was still passed on to the employees, but in the form of HSA contributions that were voluntary. Some employees chose the HSA and struggled to find the budget to fund it. Some employees chose the HSA and didn’t fund it fully because it wasn’t in their budget to do so yet.

In 2005 and 2006, Thomas’s treatment didn’t change much. Claims were about $750,000 for each year. What did change were our benefits. Every other insurance company again refused to bid on our business. At the end of 2005, we faced another premium increase of over 55%. The only way to lessen the burden was to accept some very troublesome changes to the benefits. The out-of-pocket maximum increased from $4,000 to $8,000. Prescriptions after the deductible was met went from 100% coverage to $10-$50 each. Most troubling of all, a $1 million lifetime maximum was introduced. The direct effect of this cap was to weed out high-cost plan participants like my son.

When lifetime capitation was first introduced by the insurance industry in 1970, $1M was a common standard. A $1M lifetime cap in 1970, adjusted for inflation, should be close to $20 million today, yet a $1M cap is still the norm and now woefully inadequate.

In 2006, Thomas’s claims were about $800,000. Premiums for 2007 increased yet again. Benefits were further limited by increasing the deductible from $4,000 to $6,000 and out-of-pocket annual maximum from $8,000 to $10,000 for family coverage. It is now officially impossible for a new employee making maximum allowable contributions to his HSA to match the new deductible in a year’s time.

The introduction of the cap for the 2006 plan started a timer that couldn’t be reversed. By the time we hit the cap, I would have to make a critical decision. In order to not fall into a “pre-existing condition” category with my son’s hemophilia, I would have to find some way to maintain private insurance coverage when the cap was exhausted.

Over the next couple of months following the introduction of the lifetime cap, I searched and searched for a solution.

(He lists six options, each with its own problems.)

7) Change the world. Lobby for single-payer, single-risk-pool, universal-access coverage like that proposed by Physicians for a National Health Plan and many others. This is the only option that addresses the real problems of health care costs, access to care, and social responsibility while remaining fair and making economic sense.

Press release – PNHP and CNA/NNOC:
https://www.pnhp.org/news/2007/january/physicians_and_nurse.php

Comment:

By Don McCanne, MD

The private insurance model is fundamentally different from a universal, publicly-funded social insurance model. The former works well for the healthy, but not so well for the sick and injured; the latter always works for everyone. When will the nation finally learn this lesson?

Let’s skip the gimmicks and enact real reforms

By MERTON C. BERNSTEIN
HEALTH CARE
Special to The Kansas City Star
Published on Wed, Jan. 24, 2007

We have reached a national consensus on health insurance — it costs too much and covers too few. Most “reform” proposals, like California Gov. Arnold Schwarzenegger’s and the health insurance industry’s, camouflage their real costs with tax breaks and other subsidies.

But coverage and cost are not two separate problems. Repeated double-digit cost increases caused coverage of millions to disappear. To cover the uncovered, we must — and we can — make better use of the $2 trillion public and private medical-care programs now expend. Banishing unnecessary nonbenefit costs could generate funds to cover everyone.

It is not reform to make individuals insure themselves. An individual mandate would require establishing and maintaining records just to keep track of compliance; enforcement proceedings against every noncomplying individual; processing requests for exemptions; keeping tabs on those not exempted; and repeatedly updating all these steps.

It is not reform to condition subsidies on poverty. Such tests, which also would require repeated updating, would cost tens of billions when applied to millions of people. That helps explain why means-tested Medicaid costs almost 5 percent more to administer than nonmeans-tested Medicare. Nor is it reform to vary millions of individuals’ subsidies based on the inevitable variations in individual income — at great administrative cost.

These nonreforms only increase costs — massively reducing funds for essentials like vaccination. They pepper the much-heralded Massachusetts and Schwarzenegger health-care plan and the health-care-provider proposal, backed by AARP, to extend coverage. Understandably, that proposal omits to say who will pay.

Permitting physician ownership interests in testing laboratories, imaging facilities, hospitals, nursing homes and pharmacies would provide inducements to prescribe what they sell. Rather than assuming that everyone would resist temptation, medical societies and legislation should shut those cookie jars. That would improve care and reduce costs.

Reform will elude us if the public and policy-makers mistake what needs changing. For example, in a 2006 Kaiser Foundation opinion poll, “too many malpractice suits” tied for second as the largest cause of ballooning health-care costs. Yet analyses show that malpractice premiums and litigating costs constitute just 1 percent of medical-care outlays.

If Medicare covered us all, more of the health-care dollar would go for treatment and prevention. Currently, insurers and providers spend huge amounts to match billions of billings with thousands of private plans and many public programs with differing eligibility and benefit criteria.

Medicare for All would save most of those nonbenefit charges. Some object that savings would be slight because providers must maintain records for treatment. Yes, but that recordkeeping does not require clericals to determine what programs, if any, cover claimants, and if so, what is billable and how much is reimbursable.

To tame costs and extend coverage, we must harvest savings where now we sow and reap inefficiently. The Schwarzenegger and Massachusetts gimmicks and the plan shaped by the same people who designed the perplexing and inefficient Part D — health insurers and AARP — plow other fields. Instead of savings, they increase nonbenefit costs. That’s not reform.

Merton C. Bernstein is a Coles Professor of Law Emeritus at Washington University. He was principal consultant to the National Commission on Social Security Reform and is a founding board member of the National Academy of Social Insurance.

(c) 2007 Kansas City Star and wire service sources. All Rights Reserved.
http://www.kansascity.com

Reform lesson from Massachusetts

Sticker shock for state care plan

By Alice Dembner
The Boston Globe
January 20, 2007

A state panel yesterday outlined for the first time the minimum requirements for coverage under the state’s new health insurance law, a package estimated to cost $380 a month on average for an individual.

Panel members struggled yesterday to balance affordability with protection from catastrophic medical bills and remained divided on many issues.

“If we’re going to mandate this, people need to see that they’re getting some value,” said panel member Jonathan Gruber, an economics professor at the Massachusetts Institute of Technology. But, he added, the premium is “bad news.”

“I’m trying to think of something to get this number down,” he said.

The minimum plan would limit annual out-of-pocket expenses to $5,000 for an individual and $7,500 for a family and include prescription drug coverage, according to the proposal by a subcommittee of the Commonwealth Health Insurance Connector board, which is implementing the new law.

As proposed, deductibles would run no higher than $2,000 per individual and $4,000 per family.

Advocates for the uninsured were stunned at the price, considerably higher than the $200 estimated by Mitt Romney when he was governor and first proposed universal coverage. A spokesman for insurers said the requirements were too prescriptive and could undermine the goal of universal coverage.

“For a large proportion of the folks not eligible for subsidized care, the bare minimum plan is flat-out unaffordable, not only because of the premiums, but the deductibles and out-of-pocket expenses,” said John McDonough, executive director of Health Care for All, an advocacy group that supports the health law. “This is a significant disappointment. We think the Connector and particularly the insurers need to go back to the drawing board.”

Eric Linzer, vice president of the Massachusetts Association of Health Plans, said the Connector committee’s recommendations were boxing insurers into a corner.

“There’s really a limited number of ways you can make premiums affordable,” he said. “If the minimum credible coverage is too high and coverage is unaffordable, it runs the risk of not achieving universal coverage.”

http://www.boston.com/news/local/massachusetts/articles/2007/01/20/sticker_shock_for_state_care_plan/?page=full

Comment:

By Don McCanne, MD

It is astonishing that former Gov. Romney and the Massachusetts legislature are basking in the glory of having enacted a universal health program for the state, considering the process that is taking place.

They decided to establish a requirement that each person purchase a private health plan (individual mandate). That would work only if the plans were affordable. It was also decided that the plans must meet a reasonable standard of coverage. So what did they do? They declared that the plans would have to meet a reasonable standard of coverage and that they would have to have low, affordable premiums.

It was not as if this fundamental flaw in their proposal was simply overlooked. Many activists pointed out that you can have insurance premiums that are affordable, or you can have coverage that makes health care affordable, but you can’t have both. Health care simply costs too much. To be effective, the fragmented private insurance pools must have adequate funds to pay reasonable health care costs. That means that the private insurance funds must charge high premiums to fund them. Simply declaring otherwise is legislative malfeasance.

There is another option that would work. Abolish the fragmented risk pools and establish a single, universal pool to fund comprehensive health care. Automatically include everyone in that pool. Then, instead of attempting to tailor premiums to fit each individual, use equitable tax policies to fund the pool. That way, the contribution asked of each individual is affordable, and health care access is also affordable. And isn’t it affordability that everyone is trying to achieve?

Nurses, Doctors, Patients Respond to Bush Health Proposals, Unite In Call for Real Universal Healthcare

Legislators Introduce Key Single-Payer Health Bill

California Nurses Association
National Nurses Organizing Committee
Physicians for a National Health Program

Washington Press Conference Wednesday

Physicians, registered nurses and patients will join together in a Washington press conference Wednesday to respond to President Bushs State of the Union healthcare proposals and to promote legislation for the only healthcare reform that would assure universal coverage, control cost, and end insurance industry interference with care.

WHO: Oliver Fein, MD (PNHP); Deborah Burgher, RN (CNA/NNOC); Reps. John Conyers and Dennis Kucinich, and Patients.

WHERE: National Press Club, Zenger Room, 529 14th St. NW, Washington

WHEN: Wednesday, January 24

TIME: 1 p.m.

In addition to commenting on the President’s healthcare initiatives, the physicians and nurses will describe a stepped up campaign on behalf of HR 676, the United States National Health Insurance Act.

HR 676, introduced by U.S. Reps. John Conyers and Dennis Kucinich with 78 co-sponsors, is being re-introduced in the new Congress. HR 676 is also supported by 225 labor organizations across the nation. Reps. Conyers and Kucinich will be at the conference to talk about future Congressional efforts.

“There are only two real choices in the present healthcare debate, those commercially-based models which reinforce the insurance industry and fail to provide genuine universal and comprehensive care, and HR 676, a patient-based model which caregivers know is the most effective, humane approach,” said Deborah Burger, RN, president of the 75,000-member California Nurses Association/National Nurses Organizing Committee.

“Solutions to the health care crisis based on increasing our reliance on private health insurance companies are bound to fail,” said Dr. Oliver Fein, director of the 14,000-member Physicians for a National Health Program. Insurance companies limit patients’ choice of doctor and hospital, and take money out of patient care and put it into marketing, bill collectors and claims deniers. This situation is morally repugnant. We need a National Health Insurance program. We need HR 676.”

PNHP and CNA/NNOC are co-sponsoring the event.

Contacts:
CNA/NNOC: Charles Idelson, 510-273-2246, 415-559-8991 (cell)
PNHP: Nick Skala, 312-782-6006, 773-220-9268 (cell)

Krugman's response to Bush plan

Gold-Plated Indifference

By PAUL KRUGMAN
New York Times
January 22, 2007

President Bush’s Saturday radio address was devoted to health care, and officials have put out the word that the subject will be a major theme in tomorrow’s State of the Union address. Mr. Bush’s proposal won’t go anywhere. But it’s still worth looking at his remarks, because of what they say about him and his advisers.

On the radio, Mr. Bush suggested that we should “treat health insurance more like home ownership.” He went on to say that “the current tax code encourages home ownership by allowing you to deduct the interest on your mortgage from your taxes. We can reform the tax code, so that it provides a similar incentive for you to buy health insurance.”

Wow. Those are the words of someone with no sense of what it’s like to be uninsured.

Going without health insurance isn’t like deciding to rent an apartment instead of buying a house. It’s a terrifying experience, which most people endure only if they have no alternative. The uninsured don’t need an “incentive” to buy insurance; they need something that makes getting insurance possible.

Most people without health insurance have low incomes, and just can’t afford the premiums. And making premiums tax-deductible is almost worthless to workers whose income puts them in a low tax bracket.

Of those uninsured who aren’t low-income, many can’t get coverage because of pre-existing conditions — everything from diabetes to a long-ago case of jock itch. Again, tax deductions won’t solve their problem.

The only people the Bush plan might move out of the ranks of the uninsured are the people we’re least concerned about — affluent, healthy Americans who choose voluntarily not to be insured. At most, the Bush plan might induce some of those people to buy insurance, while in the process — whaddya know — giving many other high-income individuals yet another tax break.

While proposing this high-end tax break, Mr. Bush is also proposing a tax increase — not on the wealthy, but on workers who, he thinks, have too much health insurance. The tax code, he said, “unwisely encourages workers to choose overly expensive, gold-plated plans. The result is that insurance premiums rise, and many Americans cannot afford the coverage they need.”

Again, wow. No economic analysis I’m aware of says that when Peter chooses a good health plan, he raises Paul’s premiums. And look at the condescension. Will all those who think they have “gold plated” health coverage please raise their hands?

According to press reports, the actual plan is to penalize workers with relatively generous insurance coverage. Just to be clear, we’re not talking about the wealthy; we’re talking about ordinary workers who have managed to negotiate better-than-average health plans.

What’s driving all this is the theory, popular in conservative circles but utterly at odds with the evidence, that the big problem with U.S. health care is that people have too much insurance — that there would be large cost savings if people were forced to pay more of their medical expenses out of pocket.

The administration also believes, for some reason, that people should be pushed out of employment-based health insurance — admittedly a deeply flawed system — into the individual insurance market, which is a disaster on all fronts. Insurance companies try to avoid selling policies to people who are likely to use them, so a large fraction of premiums in the individual market goes not to paying medical bills but to bureaucracies dedicated to weeding out “high risk” applicants — and keeping them uninsured.

I’m somewhat skeptical about health care plans, like that proposed by Gov. Arnold Schwarzenegger, that propose covering gaps in the health insurance market with a series of patches, such as requiring that insurers offer policies to everyone at the same rate. But at least the authors of these plans are trying to help those most in need, and recognize that the market needs fixing.

Mr. Bush, on the other hand, is still peddling the fantasy that the free market, with a little help from tax cuts, solves all problems.

What’s really striking about Mr. Bush’s remarks, however, is the tone. The stuff about providing “incentives” to buy insurance, the sneering description of good coverage as “gold plated,” is right-wing think-tank jargon. In the past Mr. Bush’s speechwriters might have found less offensive language; now, they’re not even trying to hide his fundamental indifference to the plight of less-fortunate Americans.

State workers union backs single-payer health legislation

By Workday staff
Workday Minnesota
22 January 2007

SHOREVIEW – The Minnesota Association of Professional Employees, representing more than 11,000 professional state government employees, has endorsed a national single-payer health-care system.

The MAPE Board of Directors on Friday endorsed HR 676 (the United States National Health Insurance Act), which is sponsored by Congressman John Conyers, D-Mich. HR 676 would institute a single-payer health-care system in the United States by expanding a greatly improved Medicare system to every resident.

“Affordable health care should be made available to all residents of this country,” said MAPE Executive Director Jim Monroe. “Single-payer health care is an economical way to address the health-care crisis in this country.”

Monroe added, “All Americans should be able to get the preventive care that they need to help prevent catastrophic illnesses when they are easier and less expensive to treat. Furthermore, if they do get ill, all Americans should be able to concentrate on getting well instead of worrying about how they will pay for the urgent care that they need.”

In backing HR 676, MAPE joined the Minnesota AFL-CIO which also endorsed the legislation at its last Executive Council meeting.

“The General Board of the Minnesota AFL-CIO supports HR 676 because we believe it is the best, most efficient and cost effective way to ensure that everyone has access to affordable, quality health care,” said Secretary-Treasurer Steve Hunter.

The Minnesota AFL-CIO is the 17th state labor federation to endorse the proposal. More than 200 individual unions and central labor councils also have voiced their support.

HR 676 would cover every person in the United States for all necessary medical care including prescription drugs, hospital, surgical, outpatient services, primary and preventive care, emergency services, dental, mental health, home health, physical therapy, rehabilitation (including for substance abuse), vision care, chiropractic and long term care. It would end deductibles and co-payments. Proponents say HR 676 would save billions annually by eliminating the high overhead and profits of the private health insurance industry and HMOs. Clinics, hospitals and other health care providers would continue to be privately operated, but would be reimbursed for services through one government system.

Physicians and Nurses Decry Bush Health Plan, Reject Reform Based on Private Insurance

Unite in Call for National Health Insurance – “Medicare for All”

New Congress to Introduce Plan and Hold Hearings

Embargoed Until:
January 23, 2007 (12:00 a.m. EST)

Contacts:
Oliver Fein, MD 917-859-5140 (cell)
Nick Skala 312-782-6006
Charles Idelson(CNA) 415-559-8991 (cell)
Kay Tillow 502-636-1551

Washington, DC – The 75,000-member California Nurses Association and the 14,000-member Physicians for a National Health Program will announce their opposition to President Bush’s feeble health reform proposal at the National Press Club on Wednesday, January 24 at 1:00 p.m. The groups will call on Congress to pass single-payer legislation that will provide real coverage to all Americans.

“There are only two real choices in the present healthcare debate, plans that continue to push the defective products of the private insurance industry, and the one plan that would expand Medicare to all Americans (HR 676) . Caregivers know that this patient-based model is the most effective and humane approach,” said Deborah Burger, RN, president of the California Nurses/National Nurses Organizing Committee.

“Bush’s reform plan – fiddling with the tax system and peddling skimpy private health plans – will fail miserably. Like other plans that rely on private insurers – e.g. the Massachusetts reform and the Schwarzenegger, AHIP, and Wyden proposals – it would leave millions without coverage and continue to squander $300 billion annually on private insurance marketing, bill collectors, and other useless bureaucratic activities.” said Dr. Oliver Fein, Professor of Medicine at Cornell University and Director of Physicians for a National Health Program. “Moreover, none of these plans would upgrade coverage for the tens of millions who are currently under-insured. Three-quarters of Americans bankrupted by medical bills last year had health insurance. Only national health insurance can cover all the 47 million uninsured and improve coverage for all other Americans at an affordable cost.”

“Private health insurers succeed by bankrupting and impoverishing families like mine,” said Nathan Wilkes, a computer network engineer whose three year old son, Thomas, has hemophilia. “My employers’ premiums have skyrocketed since Thomas was born. The only private coverage available to our company today has a million dollar cap, which Thomas will exceed in a few months. The only health proposal that doesn’t bankrupt families unfortunate enough to face serious illness is single payer national health insurance.”

National health insurance has been adopted by every other industrialized country in the world.

“America’s industrialized competitors all have national health care systems that cover everyone and are more efficient than our broken, fragmented system,” said Kay Tillow of the Kentucky Nurses Professional Organization. Over 225 unions have endorsed a national health insurance program for the US (HR 676), including 17 state AFL-CIO’s. “Labor support is growing rapidly. Premiums have been skyrocketing and the employer-based system is collapsing. Single payer is the only plan that will cover everyone and effectively control costs.”

Rep. Conyers and Rep. Kucinich will introduce “The National Health Insurance Act: Medicare for All (HR 676)” into the new Congress this week. The bill garnered nearly 80 co-sponsors in the last Congress, more than any other reform proposal, and at least three of the newest members of Congress made support for single payer national health insurance a key issue in their campaigns.

“Private health insurers are obligated only to their shareholders. But nurses and doctors have an obligation to our patients – both the patients we have today and the ones we will have tomorrow. We know that only guaranteed, lifelong, coverage for every American under a national health program can heal our wounded health system and restore compassion and humanity to medicine,” said Dr. Fein. “We call on our colleagues from medicine, nursing, public health, and other branches of medicine to join us in our insistence that health care is a public service, not a business.”

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Physicians for a National Health Program (www.pnhp.org) is an organization of 14,000 physicians that support single payer national health insurance. PNHP is headquartered in Chicago and has physician-spokespeople across the US. For contacts in your area, call 312-782-6006 or write nick@pnhp.org

The California Nurses Association/National Nurses Organizing Committee (www.calnurses.org) is the fastest- growing professional RN organization in the nation representing over 75,000 direct-care registered nurses in 170 facilities.

Krugman’s response to Bush plan

Gold-Plated Indifference

By PAUL KRUGMAN
New York Times
January 22, 2007

President Bush’s Saturday radio address was devoted to health care, and officials have put out the word that the subject will be a major theme in tomorrow’s State of the Union address. Mr. Bush’s proposal won’t go anywhere. But it’s still worth looking at his remarks, because of what they say about him and his advisers.

On the radio, Mr. Bush suggested that we should “treat health insurance more like home ownership.” He went on to say that “the current tax code encourages home ownership by allowing you to deduct the interest on your mortgage from your taxes. We can reform the tax code, so that it provides a similar incentive for you to buy health insurance.”

Wow. Those are the words of someone with no sense of what it’s like to be uninsured.

Going without health insurance isn’t like deciding to rent an apartment instead of buying a house. It’s a terrifying experience, which most people endure only if they have no alternative. The uninsured don’t need an “incentive” to buy insurance; they need something that makes getting insurance possible.

Most people without health insurance have low incomes, and just can’t afford the premiums. And making premiums tax-deductible is almost worthless to workers whose income puts them in a low tax bracket.

Of those uninsured who aren’t low-income, many can’t get coverage because of pre-existing conditions — everything from diabetes to a long-ago case of jock itch. Again, tax deductions won’t solve their problem.

The only people the Bush plan might move out of the ranks of the uninsured are the people we’re least concerned about — affluent, healthy Americans who choose voluntarily not to be insured. At most, the Bush plan might induce some of those people to buy insurance, while in the process — whaddya know — giving many other high-income individuals yet another tax break.

While proposing this high-end tax break, Mr. Bush is also proposing a tax increase — not on the wealthy, but on workers who, he thinks, have too much health insurance. The tax code, he said, “unwisely encourages workers to choose overly expensive, gold-plated plans. The result is that insurance premiums rise, and many Americans cannot afford the coverage they need.”

Again, wow. No economic analysis I’m aware of says that when Peter chooses a good health plan, he raises Paul’s premiums. And look at the condescension. Will all those who think they have “gold plated” health coverage please raise their hands?

According to press reports, the actual plan is to penalize workers with relatively generous insurance coverage. Just to be clear, we’re not talking about the wealthy; we’re talking about ordinary workers who have managed to negotiate better-than-average health plans.

What’s driving all this is the theory, popular in conservative circles but utterly at odds with the evidence, that the big problem with U.S. health care is that people have too much insurance — that there would be large cost savings if people were forced to pay more of their medical expenses out of pocket.

The administration also believes, for some reason, that people should be pushed out of employment-based health insurance — admittedly a deeply flawed system — into the individual insurance market, which is a disaster on all fronts. Insurance companies try to avoid selling policies to people who are likely to use them, so a large fraction of premiums in the individual market goes not to paying medical bills but to bureaucracies dedicated to weeding out “high risk” applicants — and keeping them uninsured.

I’m somewhat skeptical about health care plans, like that proposed by Gov. Arnold Schwarzenegger, that propose covering gaps in the health insurance market with a series of patches, such as requiring that insurers offer policies to everyone at the same rate. But at least the authors of these plans are trying to help those most in need, and recognize that the market needs fixing.

Mr. Bush, on the other hand, is still peddling the fantasy that the free market, with a little help from tax cuts, solves all problems.

What’s really striking about Mr. Bush’s remarks, however, is the tone. The stuff about providing “incentives” to buy insurance, the sneering description of good coverage as “gold plated,” is right-wing think-tank jargon. In the past Mr. Bush’s speechwriters might have found less offensive language; now, they’re not even trying to hide his fundamental indifference to the plight of less-fortunate Americans.

The president's new reform proposal

Bush Seeks Shift in Health Coverage

He Would Tax Those With Higher-Priced Plans, Give Breaks for Buying Cheaper Ones

By Michael A. Fletcher
The Washington Post
January 21, 2007

President Bush will propose a deep tax break for Americans who purchase their own medical insurance and would finance it with an unprecedented tax on a portion of high-priced health-care plans that workers receive from their employers, according to the White House.

Under the president’s proposal, workers who receive employer-provided health insurance would have to pay a tax on the cost of their benefit above $15,000, the threshold proposed by Bush for the tax break.

People with families who buy low-cost policies, meanwhile, would have their taxable income reduced by $15,000, regardless of the cost of the plans and whether they itemize deductions on their tax returns. The deduction would be $7,500 for single individuals. The deduction, to be indexed to account for inflation, would also be extended to those with employer-provided plans, to be offset by the cost of their coverage.

The Bush administration estimates that 80 percent of people with employer-provided plans would see their tax liability fall because the deduction would be larger than the value of their insurance plans.

http://www.washingtonpost.com/wp-dyn/content/article/2007/01/20/AR2007012000468.html

Comment:

By Don McCanne, MD

By giving every family with health insurance a $15,000 deduction from their taxable income, the president provides incentives to buy less expensive plans, since the tax benefit is the same for the cheapest plan and every other plan up to a value of $15,000.

Why would the president want to provide tax incentives to encourage individuals to buy cheaper health plans? He claims that insurance causes patients to over-utilize health care, and that health care costs will not be controlled until we end this waste. The fact is that the savings achieved by having the healthy decline services of marginal value is only a minuscule portion of our total health care budget. Most health care is provided to sick or injured individuals who need the care. The cheaper plans that the president is encouraging will increase out-of-pocket costs, often making actual health care unaffordable for precisely those who really do need it.

A further potential impact is that employers who would like to terminate their health benefit programs would have less incentive to continue to provide coverage since the employee now would become eligible for the $15,000 deduction. This further advances the president’s goal of shifting responsibility to the individual through an expansion of the ownership society – wherein you own the right to pay for your medical care.

His proposal also is a regressive method of funding health care. Since every insured individual receives the same deduction, higher-income individuals receive a greater government subsidy because of our graduated tax schedule. Worse, for individuals with modest incomes, the tax subsidy is not enough to make insurance affordable, and they will continue to do without.

At a time when everyone agrees that major reform is essential, the president comes up with this proposal. Doesn’t he care about us?

Letters: Rethinking health care options

Flies in Register's ointment

Saturday, January 6, 2007
Orange County Register

The Register’s editorial, “A healthy dose of free-market forces”[Jan. 2], makes a case for controlling health care spending by reducing government insurance programs and encouraging lower-cost private coverage options that shift more of the spending responsibility to the individual. Such changes theoretically would reduce the “perverse
incentives” to obtain too much care if the individual had to pay for it directly.

The problem with this theory is that most of us need very little care, and the marginal services that we would decline are only a very small fraction of our nation’s total health care bill.

The real reduction in spending would occur with average-income individuals who develop major medical problems and need care.

This reduction would not be the result of informed health care shopping, but it would occur simply because the individuals could not pay the out-of-pocket expenses that would be required by the stripped-down, lower-cost plans.

This is not simply theory, since it has been well documented repeatedly in the health policy literature.

If we follow the Register’s recommendations, hundreds of thousands will suffer needlessly, and tens of thousands will die.

Don McCanne, M.D.
San Juan Capistrano

Register’s editorial: http://www.ocregister.com/ocregister/opinion/editorials/article_1401774.php