PNHP

Breakfast Forum on International Health Care Quality Measurement Efforts

Breakfast Forum on International Health Care Quality Measurement Efforts

Breakfast Forum on International Health Care Quality Measurement Efforts Monday, June 7, 2004
7:30 am – 8:30 am, Pacific time
International Perspectives on Quality Improvement:
A Report on the Commonwealth Fund’s International Working Group on Quality Indicators

Join experts on the front lines of the international effort to establish standards for measuring the quality of health care across nations in a June 7 breakfast briefing and discussion during the AcademyHealth annual research meeting.

Members of The Commonwealth Fund’s International Working Group on Quality Indicators will outline their recently completed work, reported in the May/June issue of Health Affairs, as well as review the group’s newly released report to the health ministers of the five participating countries. That report includes detailed country-by-country data on the various quality indicators studied. The briefing and discussion will be videotaped and made available later in the day via the Fund’s Web site, www.cmwf.org.

Established in 1999, The Commonwealth Fund’s International Working Group on Quality Indicators is a critical step forward in the development of international measures of health care quality. This unique collaboration and technical exchange brought together representatives of five industrialized countries-Australia, Canada, New Zealand, the United Kingdom, and the United States-committed to the development of a set of indicators to help benchmark and compare health care system performance across countries while helping clinical leaders and policymakers identify areas for improvement.

In addition to government officials, Working Group members included leading academic experts in quality measurement, representatives from the Organization for Economic Cooperation and Development (OECD), the World Health Organization (WHO), The Nuffield Trust, the Canadian Council on Health Services Accreditation, and The Commonwealth Fund.

Program Moderator: Robin Osborn, Director, Program in International Health Policy and Practice, The Commonwealth Fund
Panelists:

* Arnold Epstein, MD, Harvard School of Public Health
* Philip Davies, Australian Department of Health and Ageing
* Colin Feek, Ministry of Health, New Zealand
* John Millar, MD, Population Health and Surveillance, Provincial Health Services Authority, Canada

Location:
Garden Salon Two
Town and Country Hotel and Resort
San Diego, CA

A continental breakfast will be served.

For more information, visit The Commonwealth Fund’s Web site, www.cmwf.org, or contact:
Olivia Ralston
212-606-3852 (office)
or@cmwf.org
Bill Silberg
212-606-3841 (office)
917-679-2743 (cell)
wms@cmwf.org
Mary Mahon
212-606-3853 (office)
917-225-2314 (cell)
mm@cmwf.org

Enthoven on Americans’ sense of equity

Enthoven on Americans’ sense of equity

The 11th Princeton Conference:
Managing Cost and Quality Through the Health Care Delivery System:
Managing Care within Organized Delivery Systems
May 21, 2004

Question from audience:

…do you see this push for the health savings accounts, the health reimbursement accounts as being something which is likely to promote or work against the development of prepaid group practices and the image that you see (employer making a fixed dollar contribution and granting employees choice of competing plans, especially prepaid group practices)?

Alain C. Enthoven, Ph.D., Marriner S. Eccles Professor of Public & Private Management, Stanford University:

Well, I think it works against because it tends to shred the fabric of solidarity. …I think the high deductible approach is a real mistake… In fact, Kaiser Permanente is surrendering to the inevitable in introducing $1500 deductible plans because they have to because their competitors are doing it in small groups, and they’ve been losing members in small groups. But I think that the $1500 deductible idea is going to shift costs from the well to the sick. Right away those people with chronic conditions are going to be paying $1500 a year out-of-pocket that they weren’t paying before. And, I don’t know, maybe that’s another route to the single payer. You know, when enough Americans are–when their sense of equity is offended by that, then maybe a lot of them will say, well, it’s time for us to have national health insurance…

http://www.kaisernetwork.org/health_cast/hcast_index.cfm?display=detail&hc=1159

Comment: Professor Enthoven’s vision of managed competition has never really been tested adequately since every player in the age of managed care jockeyed for their own best positions, rather than cooperating in developing an ideal market of truly integrated health plans competing on quality and price. And there is no conceivable scenario in which his model ever will be adequately tested, especially since even large healthcare markets cannot support enough fully integrated and mutually exclusive health systems to establish a competitive base.

We have now moved into the age of consumerism in which healthcare costs are
contained by making patients individually sensitive to those costs. Every rational health policy expert agrees that patient cost-sharing will shift costs from the well to the sick. Certainly Professor Enthoven agrees.

It seems that, as we investigate various models of reform and recognize the deficiencies of each, we keep turning our thoughts to the possibility of adopting the single payer model. Even Professor Enthoven recognizes that our sense of equity may bring us to that.

Bush touts community health centers as a common-sense approach

Bush touts community health centers as a common-sense approach

The White House
May 25, 2004
Fact Sheet: Expanding Access to Health Care for Millions of Americans The President’s budgets are on track to fulfill his promise to open or expand 1,200 Community Health Centers to serve an additional 6.1 million Americans by 2006. The President’s budget for FY 2005 continues to fulfill this promise with a request of $1.8 billion for Community Health Centers — a 57% increase since 2001 — enabling the program to serve an additional 1.6 million individuals and open or expand over 330 more health centers.

Community Health Centers are an important part of the President’s agenda to
make America’s world-leading health care more accessible, and more affordable.

http://www.whitehouse.gov/news/releases/2004/05/20040525-5.html

Los Angeles Times
May 26, 2004
Bush Highlights Community Health Centers in 2005 Plan
By Edwin Chen and Vicki Kemper

In a campaign-style “conversation” at Youngstown State University, Bush touted neighborhood clinics, a centerpiece of his healthcare agenda, as a primary way to expand access to medical services.

The National Assn. of Community Health Centers, a nonprofit organization that represents the clinic network, welcomed Bush’s support for the centers but said still more funding was needed.

In 2002 and 2003, about 1,250 clinics applied for federal funds, but only 411 applications were approved, the group said. The association reported earlier this year that 36 million Americans lacked access to basic medical care. There are about 3,500 community health centers across the country, serving up to 13 million people, most of whom live in low-income urban neighborhoods or underserved rural areas. About 40% of those people have no health insurance, and many more are underinsured and cannot afford to meet the cost of their high deductibles and co-payments.

Most of the clinics, which provide primary medical care and basic dental services, receive little or no federal funding.

Neighborhood clinics are “a common-sense approach to making sure the healthcare system works . without centralizing the decision-making process in Washington, D.C.,” Bush said.

http://www.latimes.com/news/nationworld/nation/la-na-bush26may26,1,3004657.story

Comment: Providing federal support for community health centers is the centerpiece of President Bush’s program to “make sure the healthcare system
works.”

How well is it working? 411 of 3500 or only 12% of community health centers
have received funding under his program. $1.8 billion has been budgeted to serve 13 million individuals, or $138 per individual. Realizing that our per capita health expenditures for 2004 are $6167, it is clear that $138/year will buy very little health care, especially considering the greater needs of this sector of our society.

Sadly, it looks like President Bush’s centerpiece doesn’t even have a table to hold it up.

Bush's health care scam

Bush’s health care scam
By Robert Kuttner  |  May 27, 2004

IF THE MESS in Iraq and the high price of oil were not crowding out other election year issues, health care would top the list. Premium costs keep increasing, out-of-pocket charges keep being shifted onto consumers, and the number of uninsured is at an all-time high.

President Bush, speaking Tuesday at a Youngstown, Ohio, community health center, promised to help more uninsured Americans obtain affordable health care. But his key proposals are dubious health policy, waste taxpayer dollars, and are unlikely to increase coverage. They deserve more attention because they epitomize Bush’s utterly cynical approach to governing.

Here’s what Bush would do.

First, he relies on tax credits. A family earning $25,000 or less could receive a “refundable tax credit” (that is, a government payment) of up to $3,000 toward the purchase of health insurance. The trouble is that the average family health insurance policy provided by employers in 2003 cost $9,000, and individually purchased policies cost even more.

A family with $25,000 income, even with a $3,000 subsidy from Bush’s plan, would still have to pay $6,000 out of pocket. Families with $25,000 or less are just scraping by. How many can afford to spend almost a quarter of their total income on health insurance?

Worse, individual health insurance policies are the least efficient way to provide health coverage because they are more costly than group plans to administer. And they leave families with any history of illness vulnerable to denial of insurance on grounds of a “preexisting condition.” (About half of the uninsured have histories of serious medical problems.) So, few people currently without insurance would actually benefit from Bush’s tax credit scheme.

About two-thirds of workers earning under $25,000 already have employer-provided insurance. For them, the tax credit would be a windfall; it would not reduce the number of insured. Younger and healthier workers would opt out into low-cost individual plans, raising the cost to other workers. A study by the Kaiser Family Foundation suggests that the net effect would be a loss of employer-provided insurance.

Second, the president, working with the National Federation of Independent Businesses (the very conservative small-business lobby), proposes something called Association Health Plans. The idea is that small businesses can organize themselves into associations to purchase health insurance collectively at lower rates.

This sounds like a good idea, except that small businesses are already free to do that. The magazine that I edit, with 23 employees, has long been a member of just such an association so we can purchase affordable insurance for our staff.

The new and insidious wrinkle in the Bush proposal is that it would exempt such associations from regulations that currently prohibit discrimination against individuals based on health status. With this new provision, insurers could offer very favorable rates for health plans whose members were limited to the young and the healthy.

As younger workers bail out of larger insurance pools, middle-aged workers and their dependents, as well as those with histories of illness, would face huge rate increases. The bipartisan Congressional Budget Office has estimated that some 20 million Americans would face higher insurance costs if this proposal were enacted. Both The Wall Street Journal and Forbes magazine, not exactly lefty news organs, have published articles pointing out the serious flaws in this approach.

Why would the business federation support such a scheme? One reason is that it stands to make more than $100 million a year organizing and selling such plans.

Bush would also increase the tax benefits of so called Health Savings Accounts. Under this scheme, taxpayers can set up tax-sheltered accounts similar to IRAs and then use the proceeds to pay out-of-pocket health costs. Bush wants to expand these so they can also be used to pay premiums.

But very few low-income people use such accounts. They are beneficial mainly to people in higher tax brackets. They also create incentives for people to buy policies with very high deductibles, which defeats the goal of preventive medical care.

Taken together, Bush’s new plans would cost the Treasury more than $100 billion over 10 years in lost revenues. He proposes to make up that loss by cutting two proven programs that actually do help more people get health care — Medicaid and the State Children’s Health Insurance Program.

So this is how our president proposes to “help the uninsured.” If the United States is a democracy worthy of the name, we the voters owe it to ourselves to look beyond the photo-ops and misleading rhetoric to the real details.

Robert Kuttner’s is co-editor of The American Prospect. His column appears regularly in the Globe. 
© Copyright 2004 Globe Newspaper Company.
 

U.K. NHS more efficient than Kaiser(HMO)

Dr Alison Talbot Smith, Dr Shamini Gnani, Prof Allyson M Pollock, Sir Denis Pereira GrayBritish Journal of General Practice 01 June 2004

A key document in UK government policy making for the NHS has been evaluated by Dr Alison Talbot Smith and her co-authors Dr Shamini Gnani and Prof Allyson Pollock of UCL’s School of Public Policy, and Sir Denis Pereira Gray in the British Journal of General Practice published on 01 June 2004. The original paper purports to show that Kaiser Permanente (a US HMO or health maintenance organisation) “achieved better performance at roughly the same costs as the NHS”.

An evaluation will show that the paper has four major areas of error. Crucially like was not being compared with like. Kaiser covers around eight million people in the US, mainly the working well. In contrast the NHS provides universal coverage to around 60 million citizens including the unemployed, the poor, and older people. Richard Feachem et al, the authors of the original paper, were not able to adjust for the differences in the populations, thereby negating comparisons of bed use and costs.

Similarly Feachem et al also used an unorthodox approach to adjusting for level of service when calculating costs. They did not include the additional charges that Kaiser members incur, currently £28 for each primary care consultation, £56 to attend an accident & emergency centre, and £285 for childbirth, and they omitted the 12% of Kaiser members who take out supplementary cover for services which are not included as part of the plan (‘coinsurance’).

They also wrongly applied a double currency conversion which added no less than 40% to their calculation of the NHS’s costs. They converted pounds into dollars at the general exchange rate, and then took this dollar rate and multiplied it again by the special rate that applies to the health sector. As the chief economist for the Department of Health pointed out, “it is simply wrong to adjust for health care prices over and above adjusting for general differences in prices”. In spite of systematically inflating NHS costs and deflating Kaiser’s, the NHS still comes out ahead. Undoing it puts NHS costs at $1,102 per capita compared to Kaiser’s $1,951.

Prof Allyson Pollock and Sir Denis Pereira Gray said today:
“When the Lancet published a paper on MMR, which threatened to undermine public health programmes, the DH and other major medical journals lost no time in entering into the scientific debate. Now we have a paper being widely adopted by policy makers, the claims of which concerning Kaiser are not supported by the evidence.”

James Lancaster
Public Health Policy Unit 
School of Public Policy  
UCL  
29-30 Tavistock Square
London WC1H 9QU     
t:  44 (0)20 7679 4985 (UCL: 24985)
f:  44 (0)20 7916 8536
email: j.lancaster@ucl.ac.uk

http://www.ucl.ac.uk/spp/about/health_policy/index.php

Bush’s health care scam

Bush’s health care scam
By Robert Kuttner  |  May 27, 2004

IF THE MESS in Iraq and the high price of oil were not crowding out other election year issues, health care would top the list. Premium costs keep increasing, out-of-pocket charges keep being shifted onto consumers, and the number of uninsured is at an all-time high.

President Bush, speaking Tuesday at a Youngstown, Ohio, community health center, promised to help more uninsured Americans obtain affordable health care. But his key proposals are dubious health policy, waste taxpayer dollars, and are unlikely to increase coverage. They deserve more attention because they epitomize Bush’s utterly cynical approach to governing.

Here’s what Bush would do.

First, he relies on tax credits. A family earning $25,000 or less could receive a “refundable tax credit” (that is, a government payment) of up to $3,000 toward the purchase of health insurance. The trouble is that the average family health insurance policy provided by employers in 2003 cost $9,000, and individually purchased policies cost even more.

A family with $25,000 income, even with a $3,000 subsidy from Bush’s plan, would still have to pay $6,000 out of pocket. Families with $25,000 or less are just scraping by. How many can afford to spend almost a quarter of their total income on health insurance?

Worse, individual health insurance policies are the least efficient way to provide health coverage because they are more costly than group plans to administer. And they leave families with any history of illness vulnerable to denial of insurance on grounds of a “preexisting condition.” (About half of the uninsured have histories of serious medical problems.) So, few people currently without insurance would actually benefit from Bush’s tax credit scheme.

About two-thirds of workers earning under $25,000 already have employer-provided insurance. For them, the tax credit would be a windfall; it would not reduce the number of insured. Younger and healthier workers would opt out into low-cost individual plans, raising the cost to other workers. A study by the Kaiser Family Foundation suggests that the net effect would be a loss of employer-provided insurance.

Second, the president, working with the National Federation of Independent Businesses (the very conservative small-business lobby), proposes something called Association Health Plans. The idea is that small businesses can organize themselves into associations to purchase health insurance collectively at lower rates.

This sounds like a good idea, except that small businesses are already free to do that. The magazine that I edit, with 23 employees, has long been a member of just such an association so we can purchase affordable insurance for our staff.

The new and insidious wrinkle in the Bush proposal is that it would exempt such associations from regulations that currently prohibit discrimination against individuals based on health status. With this new provision, insurers could offer very favorable rates for health plans whose members were limited to the young and the healthy.

As younger workers bail out of larger insurance pools, middle-aged workers and their dependents, as well as those with histories of illness, would face huge rate increases. The bipartisan Congressional Budget Office has estimated that some 20 million Americans would face higher insurance costs if this proposal were enacted. Both The Wall Street Journal and Forbes magazine, not exactly lefty news organs, have published articles pointing out the serious flaws in this approach.

Why would the business federation support such a scheme? One reason is that it stands to make more than $100 million a year organizing and selling such plans.

Bush would also increase the tax benefits of so called Health Savings Accounts. Under this scheme, taxpayers can set up tax-sheltered accounts similar to IRAs and then use the proceeds to pay out-of-pocket health costs. Bush wants to expand these so they can also be used to pay premiums.

But very few low-income people use such accounts. They are beneficial mainly to people in higher tax brackets. They also create incentives for people to buy policies with very high deductibles, which defeats the goal of preventive medical care.

Taken together, Bush’s new plans would cost the Treasury more than $100 billion over 10 years in lost revenues. He proposes to make up that loss by cutting two proven programs that actually do help more people get health care — Medicaid and the State Children’s Health Insurance Program.

So this is how our president proposes to “help the uninsured.” If the United States is a democracy worthy of the name, we the voters owe it to ourselves to look beyond the photo-ops and misleading rhetoric to the real details.

Robert Kuttner’s is co-editor of The American Prospect. His column appears regularly in the Globe. 
© Copyright 2004 Globe Newspaper Company.
 

Freelance workforce vulnerable

Freelance workforce vulnerable

PR Newswire
May 25, 2004
Educated, Working, Well Paid … and No Health Insurance: A Conundrum for
Growing Freelance Workforce in New York City

The 2004 Working Today Health Insurance Affordability Survey gauged the perceptions of more than 4,000 New York City-based freelancers,independent
contractors, temps, sole proprietors and others who make their living in a
range of industries, such as media, entertainment, financial services, marketing, IT and the arts.

There are upwards of one-and-a-half million independent workers in New York
City, and tens of millions around the country (up to 30% of the nation’s workforce), according to published reports.

Among the survey’s key findings:

* 84% of NYC’s freelancers say it’s difficult for them to afford health insurance.

* Nearly all (95%) of NYC freelancers without health insurance say the primary reason they lack it is because premiums of private carriers are too expensive.

* Nearly half (47%) of NYC freelancers say they had gaps in health insurance coverage, or no coverage at all, during the past two years – and the vast majority (88%) blame high costs.

* 85% of those who experienced gaps avoided medical care during these times.

Sara Horowitz, Executive Director of Working Today:

“The rapid growth of the Form-1099 labor pool represents a fundamental shift
in the economy, yet the health insurance system remains geared solely to the
W-2 employment model. Most freelancers are too rich for public assistance
programs, and too poor to afford the premiums demanded on the open market.
It’s really appalling that millions of productive members of our society are falling through the cracks in an area as basic as health care.”

http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=109&STORY=/www/story/05-25-2004/0002180966&EDATE=

The full Working Today report, “Educated, Employed and Uninsured”:
http://www.workingtoday.org/advocacy/affordabilityreport2004.pdf

Comment: Proposals strengthening employer-sponsored coverage will never
adequately address the access and affordability issues faced by the tens of millions of freelancers in our nation. And individual mandates cannot ever fill the need if coverage remains unaffordable for freelancers.

Both single payer and health service models of reform promise universal, equitable, comprehensive coverage within a framework of genuine affordability. Other models fail to adequately contain costs and fall short on comprehensiveness and equity. Do we really need yet more studies of how lousy our system of funding health care is before we move forward with reform that will work?

Most Americans would prefer a publicly-administered insurance model to a government-owned health care delivery system. Shall we keep wasting valuable
time looking at the other inferior options, or shall we move ahead with single payer reform now?

HARLOT plc: an amalgamation of the world’s two oldest professions

HARLOT plc:an amalgamation of the world’s two oldest professions David L Sackett, Andrew D Oxman on behalf of HARLOT plc Tired of being good but poor, the authors have amalgamated the world’s two oldest professions in a new niche company, HARLOT plc, specialising in How to Achieve positive Results without actually Lying to Overcome the Truth

We’ve been good. DLS has prohibited sponsors’ stockholders, much less employees, from seats on his data safety and monitoring boards and has enforced the banning of pharmaceutical reps from the medical wards at McMaster University. ADO has exposed problems with experts and has promulgated rigorous reviews of research to inform decisions about health care. In sum, we have established impeccable reputations for protecting the validity of randomised trials and systematic reviews, and for exposing lapses in methods, validity, therapeutic claims, and professional conduct.

To read the interesting article please click here

Advocates propose right to health care

Advocates propose right to health care
Bill’s backers haven’t estimated cost or suggested funding
GARY D. ROBERTSON
Associated Press

RALEIGH – Advocates and patients strapped by medical costs urged Tuesday that state voters be given a chance to decide whether health care is a constitutional right like religious liberty, jury trials or education.

In what has become an annual tradition, Rep. Verla Insko, D-Orange, filed legislation proposing a constitutional amendment that would make health care a fundamental right in North Carolina.

The bill also would order legislators to pass a plan by 2006 that would provide “access to appropriate health care on a regular basis” to every state resident by 2010.

An estimated 1.3 million North Carolinians were without health insurance in 2002. The same year, the state was tied with Mississippi for the largest percentage growth in uninsured residents since 2000, according to the N.C. Committee to Defend Health Care.

Some workers who lost jobs at shuttered manufacturing plants during the latest economic downturn have found themselves without affordable insurance.

Sandra Bailey of Lumberton, who worked at a Guilford Mills plant for 13 years before it closed, said she can’t get health insurance. She needs medicine for a thyroid condition.

“Losing my job, not having any income and no health insurance, it’s been devastating to me,” said Bailey, one of the people who spoke at a news conference and committee meeting held Tuesday at the legislature. “You have to be well to go out in the workplace and find a job.”

Those who don’t have insurance often end up in hospital emergency rooms, where the costs end up much higher than if the patient had seen a family doctor before their condition worsened.

“The United States has the best health care in the world, but among industrialized nations we have one of the worst health care systems,” said Insko, who said she has filed similar legislation every year since 1999.

States such as California and Oregon have considered similar amendments. Maine is starting a program to insure 160,000 people without private insurance or Medicaid.

The bill doesn’t offer any explanation of how to pay for universal coverage. Private insurance premiums to cover the uninsured would likely cost billions of dollars.

Insko said pinning the proposed amendment on a single funding mechanism would generate opposition before the amendment could be debated on its merits, she said.

Germany downplays drive for health insurance reform

Reuters
May 21, 2004
Germany downplays drive for health insurance reform

The German government dampened expectations on Friday that it was planning
the rapid overhaul of its national health system with the launch as early as next year of a “citizen insurance” for which all Germans would pay.

Health Minister Ulla Schmidt and Franz Muentefering, chairman of the ruling Social Democrats (SPD) have in the past week appeared to be driving the project forward, with a view to introducing the new insurance system next year.

The system would extend funding of national health insurance to civil servants and the self-employed as well as those on higher salaries, who have so far been able to opt for private coverage.

The proposal is one of the few government reform plans that is popular with its core voters and would spread the burden of health insurance costs, helping trim high non-wage labor costs which the industry says is a factor driving firms broad.

But the ruling SPD is set to make the citizen insurance a main campaign issue in the 2006 elections, Welt newspaper reports in its Saturday edition.

While popular with the public, the citizen insurance would cause pain for private health care insurers who stand to lose business from wealthier and self-employed people, who currently have the option of public or private health care.

Germany has the third highest spending per capita on health care after the United States and Switzerland.

http://www.alertnet.org/thenews/newsdesk/L21636410.htm

Comment: Germany’s system of funding health care is one of the world’s most
expensive, yet does not adequately address many of the inequities in health
care. “Universal coverage” is not enough. Many German leaders now seem to
recognize that adopting more principles of the single payer model is the answer to making comprehensive care affordable for everyone.

Watching nations struggle with their “successful” universal programs is instructive for us. It is evermore clear that our highly deficient system of funding care should be replaced by a single payer program.

British queues provide profit opportunity

The Daily Mail
May 24, 2004
More pay up to beat NHS queue
By Jo Thornhill

Long waiting lists are forcing more people to turn their backs on the NHS and pay for major operations such as hip replacements and cataract surgery, according to a new report.

Research by YouGov has found that 53% of people are prepared to pay for a hip replacement operation – which can cost as much as £9,000 in a private hospital – rather than wait for free treatment from the state. It is not unusual to wait 12 months for a hip replacement operation on the NHS.

Neil Armitage, marketing director at Exeter Friendly Society, which commissioned the research, says people are often willing to give up luxuries such as a holiday or a new car to pay for treatment.

Private healthcare is expensive, but there are ways to cut costs for those who do not have health insurance and do not want to pay top prices. For example, Go Private, owned by Exeter Friendly Society, will find the cheapest deal. For an annual subscription of £34.95, it can help patients find treatment at the lowest price from private hospitals nationwide.

http://www.thisismoney.com/20040524/in78621.html

Exeter Friendly Society Limited:
http://www.exeterfriendly.co.uk/

Comment: Private markets work, for some. When unacceptable queues develop
in a government-run national health service, private market medicine allows
you to buy your way to the front of the queue… if you have the money.

Many nations have demonstrated that queues are best managed by controlling
capacity. Ensuring adequate capacity prevents excessive queues, while avoiding excess capacity prevents the waste and adverse outcomes of over-utilization.

If the wealthier, politically influential sector is allowed private access to services covered by the public program, then political support for the public program declines significantly. A chronically underfunded public program cannot ensure that there will be enough capacity to prevent excessive queues.

But then lucrative private health markets in parallel with public programs exemplify the magic of the marketplace. Even with inadequate capacity in an
under-funded health care delivery system, the private market provides timely
access that the public program can’t… if you have the money.

Fortunately, in the United States, the $1.8 trillion that we are spending on health care is enough to ensure adequate capacity for everyone. But we still need a universal, public insurance program to make it work. Turning our health care dollars over to the private plans in the marketplace just isn’t doing it.

Pharmacy Benefits and the Use of Drugs by the Chronically Ill

RAND study on drug co-payments

JAMA
May 19, 2004
Pharmacy Benefits and the Use of Drugs by the Chronically Ill
By Dana P. Goldman, PhD, et al

Objective: To determine how changes in cost sharing affect use of the most commonly used drug classes among the privately insured and the chronically ill.

Results: Doubling co-payments was associated with reductions in use of 8 therapeutic classes. The largest decreases occurred for nonsteroidal anti-inflammatory drugs (NSAIDs) (45%) and antihistamines (44%).

Reductions
in overall days supplied of antihyperlipidemics (34%), antiulcerants (33%),
antiasthmatics (32%), antihypertensives (26%), antidepressants (26%), and
antidiabetics (25%) were also observed. Among patients diagnosed as having a
chronic illness and receiving ongoing care, use was less responsive to co-payment changes. Use of antidepressants by depressed patients declined by
8%; use of antihypertensives by hypertensive patients decreased by 10%. Larger reductions were observed for arthritis patients taking NSAIDs (27%) and allergy patients taking antihistamines (31%). Patients with diabetes reduced their use of antidiabetes drugs by 23%.

Conclusions: The use of medications such as antihistamines and NSAIDs, which are taken intermittently to treat symptoms, was sensitive to co-payment changes. Other medications-antihypertensive, antiasthmatic, antidepressant, antihyperlipidemic, antiulcerant, and antidiabetic agents-also demonstrated significant price responsiveness. The reduction in use of medications for individuals in ongoing care was more modest. Still, significant increases in co-payments raise concern about adverse health consequences because of the large price effects, especially among diabetic patients.

RAND is solely responsible for the article’s content.

http://jama.ama-assn.org/cgi/content/abstract/291/19/2344

Comment: A previous RAND study demonstrated that cost sharing by the patient results in a significant reduction in utilization of health care services when compared with patients who do not have cost sharing.

That RAND study has been used to rationalize shifting more costs to patients in an attempt to control total health care costs by reducing demand. Further analysis of the RAND data has shown that this does reduce the utilization of beneficial services. Advocates of consumer-directed health care use their rhetoric to turn this problem of establishing financial barriers to beneficial care into a “benefit” of allowing the consumer to take charge of his or her own health care. More objective advocates of cost sharing dismiss it as a necessary tradeoff for the “more important” goal of controlling costs.

This new RAND study confirms that individuals with chronic disorders will decrease their use of drugs when co-payments are increased. The reduction is
even greater for drugs that do not specifically treat their chronic conditions but that are used to relieve distressing symptoms. Although some may contend that these drugs are unimportant, symptom relief does remain a primary goal of health care.

This study will be misrepresented in the rhetorical debate over reform. Supporters of creating price sensitivity for patients will laud this study. They will contend that co-payments cause patients to reject unnecessary prescriptions while continuing to purchase those medications that they really need. In our debates we will be confronted with this claim. We will need to either take the initiative or rephrase their misleading claim by stating that co-payments reduce the utilization of essential drugs for chronic conditions, and they reduce even more the use of drugs that can provide significant relief of pain and suffering!

There are far more effective and patient-friendly mechanisms of containing health care costs. We don’t need to adopt policies that would perpetuate pain and suffering, especially for those patients with the greatest needs.