By Catalina Amuedo-Dorantes, Neeraj Kaushal, Ashley N. Muchow
National Bureau of Economic Research, August 2020

Abstract

Using county-level data on COVID-19 mortality and infections, along with county-level information on the adoption of non-pharmaceutical interventions (NPIs) in the United States, we examine how the speed of NPI adoption affected COVID-19 mortality. Our estimates suggest that advancing the date of NPI adoption by one day lowers the COVID-19 death rate by 2.4 percent. This finding proves robust to alternative measures of NPI adoption speed, model specifications that control for testing and mobility, and across various samples: national, restricted to the Northeast region, excluding New York, and excluding the Northeast region. We also find that the adoption speed of NPIs is associated with lower infections, as well as lower non-COVID mortality, suggesting that these measures slowed contagion and the pace at which the healthcare system might have been overburdened by the pandemic. Finally, NPI adoption speed appears to have been less relevant in Republican counties, suggesting that political ideology might have compromised their efficiency.

From the Introduction

In the United States, where COVID-19 has taken a high toll in terms of infections and mortality, skepticism toward NPIs reigns high among the public and legislators. Early in the pandemic, President Trump famously criticized NPIs by remarking that “the cure cannot be worse than the problem itself.” The nation remained divided on the effectiveness of NPIs, even as the pandemic raged from March to early May 2020 in the northeast, spreading to the rest of the country thereafter. Surveys show that conservative Republicans expressed more skepticism about NPIs than liberal Democrats. State and local implementation and lifting of NPIs were often driven by political ideology. Republican-governed cities were slower in adopting NPIs, whereas cities led by Democrats were more aggressive.

Heterogeneous impacts

Studies show that attitudes towards the efficacy of NPIs have been partisan, with Republican governors and mayors being more reluctant to implement NPIs. It is also possible that residents in majority-Republican counties with NPIs in place may be less compliant with health care guidelines and recommendations. We first examine the differential impact that the speed of NPI adoption had in Republican counties—measured as those with a Republican vote share above 50 percent in the 2016 presidential election—given the role of political partisan ideology in NPI adoption. Adopting an NPI one day earlier lowers COVID-19 mortality in majority-Republican counties by approximately 2.4 percent, whereas the reduction in other counties reaches 5.4 percent. In other words, speeding up the implementation of NPIs in primarily Republican counties would lower COVID-19 mortality by half the amount it would in non-Republican counties. Why? Perhaps, NPIs are less strictly observed in Republican counties, in which case, speeding up their implementation does not have the same bite as in other counties. Note that descriptive statistics in Table 1 show that, according to our NPI speed measure, Republican counties were more likely to be early adopters, largely on account of the late outbreak of the pandemic in these counties. Thus, our findings suggest that, despite the advantage of learning from the experience of counties where the virus spread earlier, the NPIs were less effective in these counties.

A couple of studies in the United States have investigated the effect of stay-at-home orders on infections and mortality from COVID-19. Both studies find that NPIs are associated with lower infection and mortality rates. We build on this research by assessing the relevance of the adoption timing of two NPIs—safer-at-home orders and non-essential business closures—on mortality.

Summary and Conclusions

The rapid spread of the COVID-19 pandemic took the world by surprise. In the absence of a vaccine, and to halt the devastating impact of the pandemic on lives, several countries opted for the adoption of non-pharmaceutical interventions (NPIs). The United States was no different in that regard, even though the response has been more fragmented and piecemeal. Prior research has shown the effectiveness of NPIs in curtailing deaths in the United States, Europe and Asia. Our focus is on the importance of their timeliness, the mechanisms behind it, and the heterogeneity of any effectiveness depending on the political ideology and degree of vulnerability of counties.

Using county-level data on COVID-19 mortality and infections, along with county-level information on the adoption of stay-at-home orders and business closures, we examine how the adoption speed of NPIs has affected COVID-19 mortality. We find that moving up the implementation date of NPIs by one day lowers the COVID-19 death rate by 2.4 percent. The effectiveness of acting early is similar for both stay-at-home orders and business closures. An event study addresses concerns regarding the endogeneity of NPI adoption, and robustness checks show the results persist when introducing controls for testing and mobility, altering the definition of adoption speed, weighting counties by population size, and considering different geographic scopes. Finally, we confirm how the relevance of responding early stems from the ability to slow contagion, which likely prevented the overburdening of the healthcare system. We also find that NPI adoption speed has less relevance in Republican counties—a possible byproduct of skepticism and reluctance to apply or fully comply with NPIs. In contrast, NPIs appear similarly effective, and their speed of implementation equally as relevant, in counties with distinct degrees of vulnerability to the disease, as captured by an index of comorbidity and the share of residents without health insurance, unemployed, or living in poverty.

While we await anxiously a vaccine or cure, NPIs remain the main mechanism to curtail COVID-19 deaths. Gaining a better understanding of their timeliness and the importance of responding early is essential, especially in the foreseeable occurrence of additional waves.

https://www.nber.org…

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Comment:

By Don McCanne, M.D.

Two non-pharmaceutical interventions (NPIs) used during the Covid-19 pandemic – stay-at-home orders and business closures – were effective in reducing mortality during the pandemic, with effectiveness being greater with earlier implementation of the interventions. This was just as true for counties with greater vulnerability such as those with higher rates of comorbidity and with higher levels of being uninsured, unemployed, or living in poverty.

However, Republican counties were slower to implement NPIs, and the delay was followed by higher mortality rates. The differences were thought to be related to political ideology. It may be not only the delay that increased mortality, but it may also have been due to lower compliance, based both on political ideology prevalent in the community and on Republican politicians who failed to provide the leadership needed in times of a public crisis.

The lesson here should be much more broad than just that of the failures in managing the Covid-19 pandemic. Health policy science is quite advanced, and we know many ways to improve the health of the nation. An example would be implementation of a health care financing system that would ensure access to and affordability of comprehensive health care services for everyone – a single payer, improved Medicare for All. But too many politicians lay the policy science aside and grant a higher priority to anti-government political ideology.

We now have 183,000 Covid deaths in the United States, and many of them could have been prevented with more effective political leadership. If we are going to be able to enact and implement the policies that we know work to benefit the health of all of us, we are simply going to have to change the politics. It’s too late to ask the 183,000 who have died, but with the facts in hand, shouldn’t the rest of us take action?

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Some patients are still receiving staggering bills. Others don’t qualify because conditions other than Covid-19 were their primary diagnosis.

By Abby Goodnough
The New York Times, August 29, 2020

A program Mr. Trump announced this spring… “should alleviate any concern uninsured Americans may have about seeking the coronavirus treatment,” Mr. Trump said in April about the program, which is supposed to cover testing and treatment for uninsured people with Covid-19, using money from the federal coronavirus relief package passed by Congress.

The program has drawn little attention since, but a review by The New York Times of payments made through it, as well as interviews with hospital executives, patients and health policy researchers who have examined the payments, suggest the quickly concocted plan has not lived up to its promise. It has caused confusion at participating hospitals, which in some cases have mistakenly billed patients who should be covered by it. Few patients seem to know the program exists, so they don’t question the charges. And some hospitals and other medical providers have chosen not to participate in the program, which bars them from seeking any payment from patients whose bills they submit to it.

Large numbers of patients have also been disqualified because Covid-19 has to be the primary diagnosis for a case to be covered (unless the patient is pregnant). Since hospitalized Covid patients often have other serious medical conditions, many have other primary diagnoses.

Critics say the stopgap program is among the strongest evidence that Mr. Trump and his party have no vision for improving health coverage, and instead promote piecemeal solutions, even in a national health crisis. Mr. Trump had promised a plan to replace the Affordable Care Act by the beginning of August, but none has been announced and he and other Republicans barely mentioned health policy in their national convention last week.

Unlike previous administrations during public health emergencies, Mr. Trump’s has not encouraged even temporary expansions of Medicaid — except for limited Covid testing — in states where the program covers few poor adults. It also declined to broadly reopen enrollment for Affordable Care Act plans once the pandemic began, although people who lose job-based coverage can enroll.

“This is not the way you deal with uninsured people during a public health emergency,” said Sara Rosenbaum, a professor of health law and policy at George Washington University.

https://www.nytimes.com…

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Comment:

By Don McCanne, M.D.

Even though the United States has the most expensive health care system of all, it still leaves tens of millions of individuals uninsured or underinsured. Because of the failure of our government to ensure adequate coverage for all, it became obvious that something was going to have to be done to cover the expenses of the victims of the Covid-19 pandemic without the means to pay for their care. To no surprise, trying to provide emergency patching of an inadequate health care financing infrastructure has fallen far short of the need.

If we had a single payer, improved Medicare for All program already in place, qualifying for health care would not have been an issue. The economic stress caused by the pandemic would still have to be managed, much as with other catastrophic events, but wouldn’t it have been so much better to have a fully functioning health care financing system already in place? Even with additional emergency financing, we are still leaving far too many out of the system. Besides, it would have been less expensive to do it right in the first place. Obviously, we can still fix it so this won’t happen again.

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By Jose F. Figueroa, Rishi K. Wadhera, Dennis Lee, Robert W. Yeh, and Benjamin D. Sommers
Health Affairs, August 27, 2020 (published ahead of print)

Abstract

Massachusetts has one of the highest cumulative incidence rates of coronavirus disease 2019 (COVID-19) cases in the US. Understanding which specific demographic, economic, and occupational factors have contributed to disparities of COVID-19 is critical to inform public health strategies. We performed a cross-sectional study of 351 Massachusetts towns/cities (01/01/2020–05/06/2020) and found that a 10 percentage point increase in the Black population was associated with a 312.3 increase in COVID-19 cases per 100,000, while a 10 percentage point increase in the Latino population was associated with an increase of 258.2 cases per 100,000. Independent predictors of higher COVID-19 rates included the proportion of foreign-born non-citizens living in a community, mean household size, and share of food service workers. After adjustment for these variables, the association between the Latino population and COVID-19 rates was attenuated. In contrast, the association between the Black population and COVID-19 rates persisted, and may be explained by other systemic inequities. Public health and policy efforts that improve care for foreign born non-citizens, address crowded housing, and protect food-service workers may help mitigate the spread of COVID-19 among minority communities. [Editor’s Note: This Fast Track Ahead Of Print article is the accepted version of the peer-reviewed manuscript. The final edited version will appear in an upcoming issue of Health Affairs.]

Discussion

Across Massachusetts’ cities and towns, Latino and Black communities are experiencing much higher rates of COVID-19 cases. Several factors measured in our data (foreign-born non-citizen status, household size, and job type) appear to explain the higher COVID-19 case rates among Latino communities in Massachusetts. It appears that these factors may not be the primary reason for higher case rates in Black communities.

While the extent of racial and ethnic disparities has already been documented, our study identifies important factors that are independently associated with higher COVID-19 case rates in the state. The proportion of foreign-born non-citizens was the strongest predictor of the burden of COVID-19 cases within a community, and in Massachusetts, this population includes sizable numbers of both Latin American (44.9%) and Asian individuals (30.7%). Furthermore, under the Trump Administration’s revised “Public Charge” Rule, which took effect in early 2020, lawfully present immigrants who use public benefits from local, state, or federal governments may be at risk of being denied permanent residency status. Although the U.S. Citizenship and Immigration Services website now encourages immigrants to seek care for COVID-19-like symptoms, enrollment in Medicaid at the time of COVID-19-related care may still be used in the Public Charge analysis. Recent studies suggest that immigrant families have strong incentives not to enroll in public health insurance like Medicaid and may avoid seeking medical care if they develop COVID-19-like symptoms and require testing. In the absence of a positive test, these individuals are less likely to isolate and quarantine, which may impede public health efforts to control the spread of COVID-19.

These issues are likely only magnified by the fact that immigrants tend to live in larger households, which we also found to be an independent predictor of COVID-19 case rates. Policy approaches that reduce barriers to accessing medical care for immigrant populations and that address crowded housing—particularly when individuals have tested positive and need to be isolated—could be important avenues for reducing disparities and slowing the spread of infection.

Our work also sheds important insights into the factors that may be contributing to the higher rates of COVID-19 cases among Latino communities. As noted above, many immigrants in the Latino community may be deferring necessary care for fear of risking citizenship under the Public Charge rule or possible deportation. In addition, Latino persons tend to be disproportionately employed in essential services that are public facing, particularly in the food service industry, which we found to be associated with higher COVID-19 rates. As the state moves to cautiously re-open more businesses, greater worker protections to reduce potential exposures may be needed in these jobs. Many low-income minority workers also do not have the luxury of working from home, and less than half of Latino workers in the U.S. have jobs with paid sick leave. While Congress recently expanded the availability of paid sick leave under the CARES Act in March 2020, the law exempted workers in large firms and health care organizations, which may leave many essential workers unprotected if they contract COVID-19.

Meanwhile, our results show large disparities in infection rates associated with Black communities, but these disparities do not appear to be primarily explained by the factors that we examined. Other factors not examined in this study may explain the disparate impact of COVID-19 in Black communities. Structural inequities, such as disproportionately high incarceration rates, residence in areas with a higher concentration of multiunit residential buildings, and de facto neighborhood segregation, which may lead to disparities in health care access and greater exposure to environmental hazards, may contribute to the spread of COVID-19 in these communities. Transportation use may also increase the risk of exposure to COVID-19, as Black workers are more likely to use public transit to commute to work.

Evidence emerging from other U.S. cities and states has similarly described that Black and Latino populations are being disproportionately affected by COVID-19. In addition, preliminary work from Massachusetts suggests that these populations also have substantially higher death rates. Our study expands upon these findings in several ways. We identify important factors (proportion of foreign-born non-citizens in a community, household size, food service occupation) that are strongly associated with the risk of developing COVID-19. In addition, we characterize the extent to which these factors, among others, may be contributing to the higher number of COVID-19 cases in Black and Latino communities. Because we evaluate each of these unique populations separately, we find that some factors, such as occupation in an essential service field, may not affect Black and Latino communities in a similar manner. Our findings provide important insights that may inform and help tailor public health and policy strategies to address the ongoing COVID-19 pandemic.

Conclusion

Across Massachusetts cities and towns, significant COVID-19 disparities are evident along multiple dimensions—particularly race/ethnicity, foreign-born non-citizen status, household size, and job type. Higher proportions of Black or Latino residents within a community was significantly associated with higher rates of COVID-19 cases. The factors examined in our study explained this relationship for Latino communities but did not appear to explain the higher rates among black communities. Further research into the social and economic factors underlying COVID-19-related disparities and new policies to address risk factors and institutional racism will be critical to controlling the epidemic and improving health equity.

https://www.healthaffairs.org…

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Comment:

By Don McCanne, M.D.

Besides removing financial barriers to care, one of the most important reasons to enact and implement single payer Medicare for All is to improve health equity. The current pandemic has provided an opportunity to demonstrate what role racial and ethnic disparities play in interfering with the establishment of health equity.

The issues are complex. In Massachusetts, although both Latino and Black populations have an increased prevalence of COVID-19 and deaths attributed to the disorder, associated aggravating factors varied between the populations, as explained in the Discussion above.

The first step is to recognize that neither of the two major candidates for president are offering health policy proposals that would adequately address the factors that result in health inequities (though one has suggested a few beneficial tweaks, however inadequate). We clearly need to enact and implement Medicare for All, but that alone is not enough. Policies to address structural racism are absolutely essential.

(How important is this issue? Although I am stepping out of line to reveal this at this time, the issue is important enough that the PNHP board is in the process of revising the mission statement of PNHP to include addressing the issue of racism. We have to do it.)

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What we know so far about health insurance losses and what it means for policy

By Josh Bivens and Ben Zipperer
Economic Policy Institute, August 26, 2020

Although the gold-standard data sources tracking changes in health insurance coverage will not be available until next year, imperfect but available data on job churn and net employment allow us to produce estimates of losses of health insurance coverage since the COVID-19 shock began. These estimates are more accurate than early-crisis estimates, and they account for job gains.

Following are key highlights from the report:

• In any given month, churn in the labor market—some people losing jobs while other people gain them—means millions of workers newly gain or lose access to employer-sponsored health insurance (ESI) each month. For example, between 2015 and 2019, roughly 2.8 million workers gained access to ESI in each month while 2.7 million workers lost access, leading to a net increase in ESI coverage of just over 100,000 workers each month.
• Extreme churn after February 2020 has led to very large losses in ESI coverage. In March and April, for example, new hiring led to 2.4 million workers gaining ESI coverage each month, but historically large layoffs led to 5.6 million workers losing coverage each month. This rate of lost coverage—over 3 million workers—dwarfs a similar calculation for the number of workers losing coverage each month during the biggest job-losing period of the Great Recession (September 2008–March 2009).
• While the data documenting labor market churn data are useful, they do not provide the best estimates of ESI losses because they are not the most timely data, nor do they provide the best net measure of employment changes.
• Since the onset of the COVID-19 shock to the economy, roughly 6.2 million workers have lost access to health insurance that they previously got through their employer, according to the best measure of net employment change. Our analysis using the monthly, high-quality measure of the total number of jobs in the economy from the Current Employment Statistics (CES) program of the Bureau of Labor Statistics (BLS) is consistent with 9 million workers having lost access to ESI in March and April 2020 but 2.9 million workers having gained coverage between April and July 2020.
• Not every worker who loses ESI loses health insurance coverage. Public health insurance rolls are expanding to absorb the enormous ESI coverage losses of recent months. However, they have not expanded enough to absorb everybody who lost job-based coverage. A new government survey measuring the economic consequences of the COVID-19 shock in real time indicates that for every 100 workers who were covered by ESI before losing their job, about 85 retained access to some form of health insurance in the week after they lost their job.
• It is likely the case that Medicaid is the dominant alternative source of coverage when people have lost ESI in the COVID-19 shock, as Medicaid rolls have likely expanded by more than 4 million since the COVID-19 shock began.

From the Conclusion:

The inefficiencies and problems caused by the U.S. system of tying access to health insurance to specific jobs is well known. The downsides of employer-based health insurance access have been made spectacularly visible by the COVID-19 shock—a shock that has cost millions of Americans their jobs and their access to health care in the midst of a public health catastrophe.

Delinking access to health insurance from specific jobs should be a top policy priority for the long term. The most ambitious and transformational way to sever this link is to make the federal government the payer of first resort for all health care expenses—a “single-payer” plan. The federal government already is the primary insurer for all Americans over the age of 65 and for households with incomes low enough to qualify for Medicaid. The advantages of a single-payer system are large, both in ensuring consistent access to medical providers that households prefer and in restraining the often-rapid growth of health care costs.

https://www.epi.org…

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Comment:

By Don McCanne, M.D.

Although the data on changes in employment status and employer-sponsored health insurance due to the COVID-19 pandemic are still preliminary, we do have enough information to know that the impact has been catastrophic. We have long known that tying health insurance to employment has serious unintended consequences, and the experience during this pandemic adds indubitably to the conclusion that it is a bad idea.

The authors conclude, “Delinking access to health insurance from specific jobs should be a top policy priority.” Further, “The most ambitious and transformational way to sever this link is to make the federal government the payer of first resort for all health care expenses — a ‘single-payer’ plan.” They are absolutely right on target.

They further conclude, “Absent a once-and-for-all switch to a single-payer system, policymakers can take smaller steps…” Uh-oh, incrementalism, in this case suggesting perhaps lowering the age of Medicare eligibility, or raising income thresholds for Medicaid eligibility, or adding a public option to the ACA exchanges, perhaps with employer play or pay, etc. These incremental measures increase costs, perpetuate inequities, perpetuate profound administrative waste, and still leave millions uninsured or underinsured.

So ignore their optional incremental steps and go for the real thing: the single payer model of an improved Medicare for All. Anything less simply perpetuates far too many of the dysfunctions of our current health care financing system. We’ve had enough of that.

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Changes to the guild’s cash-strapped health plan could force thousands of seniors off their coverage in the middle of a pandemic.

By Jeremy Fuster
Portside, LABOR, August 25, 2020

As a result of pandemic-fueled financial troubles, SAG-AFTRA on August 12 announced significant raises to premiums and minimum earnings requirements that it says are necessary to keep the entire plan afloat. Quarterly premiums will jump to $375 — or $747 for those with two or more dependents. Members under 65 will also now have to earn $25,950 or work at least 100 days during a 12-month base earnings period to qualify for coverage.

But the biggest change for seniors is that they will no longer be able to count residuals — which many Hollywood retirees rely on as a fixed income — towards that minimum earnings count.

“It’s infuriating. I’ve been in meetings telling us that this will knock 10% of health plan members off of coverage,” said one member who has been on a guild health plan since 1985. “Well, that 10% is going to be scrambling to get health care in the middle of a pandemic, and the great share of that burden will come on seniors. We are being left behind.”

The production shutdown due to the coronavirus pandemic has only worsened the financial predicament of both the health plan and the union itself. (The guild has laid off 108 people, roughly 20% of its workforce, since March.)

While the pandemic was the trigger, the changes are also connected to years-long trends both within the guild and nationwide. Inside SAG-AFTRA, the health fund has seen its surplus turn into a growing deficit since SAG and AFTRA merged in 2012. In both newsletters announcing the changes and virtual town halls with members, health plan trustees said that employer contributions to the plan have not kept up with the rising costs in health care despite negotiations with health care providers.

“The Trustees of the SAG-AFTRA Health Plan have taken a difficult but necessary action to address financial deficits facing the plan. The impact of healthcare costs that are continuing to skyrocket has been exacerbated by a global pandemic that has brought our industry to a standstill and dramatically diminished contributions to the Health Plan,” read a statement from plan representatives.

The guild’s new contract with the Alliance of Motion Picture and Television Producers — which members approved last month with 74% of the vote — includes a 1% increase in AMPTP contributions to the guild’s health plan, with the option of shifting an additional .5% of the wage increase in years 2 and 3 to the health plan or the SAG Pension Plan/AFTRA Retirement Fund.

But despite that increase in contributions from studios, the health plan trustees now say that it’s not enough to stave off this new premium surge.

Health plan trustees project another $83 million deficit next year, and warn that financial reserves would run out by 2024 without these changes.

The SAG-AFTRA premium hikes are also tied into a larger debate over the American health care system that has become a major factor in the 2020 presidential election. Andrew McGuire, head of single-payer organizing network California OneCare, argued that the lack of cost controls in the Affordable Care Act has allowed insurance companies to raise premiums well above the rate of inflation. Worse, many guild retirees will be turning to a private Medicare supplement marketplace that is similarly flawed.

“What we’re seeing now with these escalating costs and Medicare supplements is the result of decades of Republicans chipping away at the protections Medicare offers and the ability of the government to negotiate costs with insurers and pharmaceuticals,” he said.

During the Democratic presidential primary, one argument against single payer by eventual nominee Joe Biden was that such a system would take away the health care plans that unions have negotiated. It was an argument that he took to labor town halls and to forums hosted by the AFL-CIO. “I have a significant health care plan,” Biden said last September. “But guess what? Under mine, you can keep your health insurance you bargained for if you like it. If you don’t, you can move, and you can come into a public plan.”

Should Biden defeat Donald Trump and Democrats take control of Congress in November, many expect the party to make changes to the ACA and consider implementing a public option instead of the Medicare-for-All plan pushed by Sen. Bernie Sanders and the more progressive wing of the party. But McGuire believes that many union members like those in SAG-AFTRA who have lost their union-provided health care during the pandemic may be more receptive to a single-payer approach.

“The issue of single payer split a lot of unions during the primary, but there had been some unions that didn’t buy into the idea that their plans needed to be protected,” he said. “This pandemic is going to push some of the more recalcitrant unions towards single payer, and that’s going to make it more politically viable among the Democrats.”

https://portside.org…

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Increases in health care costs are coming out of workers’ pockets one way or another: The tradeoff between employer premium contributions and wages

By Laurel Lucia and Ken Jacobs
UC Berkeley Labor Center, January 29, 2020

While the research findings have been mixed on which levers employers rely on most to respond to rising health care costs as well as on what the net impact on wages has been, the bulk of the research literature indicates that, one way or another, most of the burden of ever-increasing health care costs falls on the shoulders of workers. That burden may come in the form of lower wages, higher premium contributions, or higher out-of-pocket costs. All these impacts are likely to have more severe consequences for low- and moderate-income workers, but rising health care costs affect the economic well-being of all workers with job-based coverage.

https://laborcenter.berkeley.edu…

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Comment:

By Don McCanne, M.D.

So what is happening to that hard-earned labor union health plan that everyone wants to keep, even during their retirement years? This article on the SAG-AFTRA health plan should make those relying on union insurance concerned about the future of their plans. According to the UC Berkeley Labor Center, “most of the burden of ever-increasing health care costs falls on the shoulders of workers.”

Besides, those employer-sponsored health plans that are so dearly cherished by all, what happens to them? In 2019, 67.9 million individuals in the labor market left their jobs (BLS). That can hardly be considered a stable source of health insurance coverage.

The much smaller individual insurance market, including the plans available through the ACA exchanges, is also a relatively unstable source of coverage. Keeping your coverage indefinitely? Very rare.

Reverence for private health plans is hardly a reason to reject a more equitable and comprehensive program that would ensure coverage for everyone, forever: single payer Medicare for All. Who is more likely to be there for you to provide comprehensive health care for life? Your union, your employer, or your government?

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By Joseph D. Bruch, B.A.; Suhas Gondi, B.A.; Zirui Song, M.D., Ph.D.
JAMA Internal Medicine, August 24, 2020

From the Introduction

Private equity investment in health care has markedly increased in recent years. The total disclosed value of private equity deals in health care reached $78.9 billion in 2019, up from $23.1 billion in 2015. Private equity firms use capital from institutional investors and individuals to acquire assets, such as hospitals and physician practices. After acquisition, private equity fund managers use the control offered by their newly purchased ownership stake to increase the value of the asset before selling it generally for a profit, typically in 3 to 7 years. Common strategies to enhance the value of acquired businesses include cutting costs and increasing efficiency.

From the Discussion

Private equity has a substantial and growing presence in the US health care system, especially in the hospital sector. Although private equity firms may seek to create efficiencies in the delivery of care, their financial incentives, especially the pressure to sell acquired assets for a profit on a short time horizon, might conflict with parts of the mission and priorities of health care clinicians. Anecdotal reports suggest that private equity–owned health care organizations may be more likely to operate in ways that maximize margin in the near term. Payers may be appropriately concerned about the potential for increased health care spending that may be lower value. Most worrisome are suggestions of risk to patient safety and health equity.

In this initial analysis of 204 hospitals acquired by private equity from 2005 to 2017, we found that relative to 532 control hospitals, private equity acquisition was associated with increases in annual net income, hospital charges, charge to cost ratios, and case mix index among hospitals. The proportion of patients discharged from hospitals acquired by private equity who were covered by Medicare decreased relative to control hospitals, whereas the proportion covered by Medicaid was unchanged, suggesting an increase in the share of discharges for patients who were privately insured or uninsured relative to controls. Patients who are privately insured typically garner higher reimbursements for hospitals than patients with Medicare or Medicaid.

Although the total hospital charge is the amount the hospital bills for care, it is typically not what insurers or patients pay the hospital (negotiated payment rates are less than the charge). Nevertheless, the charge represents the “asking price,” and is often the billed amount for patients paying out of pocket, including uninsured or out-of-network patients. Higher charges are also associated with greater payment among insured, in-network patients. The higher charge to cost ratio we observed may indicate that hospitals acquired by private equity firms began charging more for services, cutting operating costs, or both after the acquisition.

Increased charges following private equity acquisition provides insight into the strategic decisions made by fund managers or hospital leadership in response to new incentives hospitals face after an acquisition. Higher markups are associated with greater profitability. The increase in yearly case mix index suggests that hospitals saw reportedly sicker patients on average after acquisition. This could be due to selection effects if the composition of patients changed. However, it may also suggest that hospitals are engaging in more complete or aggressive coding. Upcoding can lead to higher diagnosis-related group payments for inpatient admissions and is another possible mechanism to increase net income.

In our main analysis, we observed greater improvements in process quality measures among private equity–acquired hospitals relative to controls, which may reflect better care for patients. However, it could also be consistent with better adherence to compliance standards or efforts to maximize opportunities for quality bonuses under pay-for-performance contracts.

Conclusions

As private equity increasingly influences health care delivery in the US, this study offers an initial national assessment of changes in hospital-level economic and quality measures associated with private equity acquisition. Although further research is needed, our findings suggest that policy makers should consider monitoring or thoughtful oversight of changes in care delivery and billing practices in hospitals acquired by private equity firms to ensure proper stewardship of societal resources and the prioritization of patient interests.

https://jamanetwork.com…

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Comment:

By Don McCanne, M.D.

These private equity investments in health care are designed to increase the value of the assets acquired and then to sell them for a large profit in just a few years. That is, they are designed to make money for the investors – a high profit in a short time span. These equity firms imply that their motivations are altruistic, that they are increasing value, quality, efficiency that makes their products worth the prices that must be paid to net high profits for the investors. So are they really serving the interests of the patients and providers, or are they just simply squeezing funds out of these deals for their own interests?

It appears that they are operating in ways that maximize margin in the near term. That means charging higher prices for the services. It means providing additional services that are of lower value which may actually increase risk to patient safety and health equity. This study showed that “private equity acquisition was associated with increases in annual net income, hospital charges, charge to cost ratios, and case mix index among hospitals.” The hospitals acquired by private equity had a decrease in Medicare patients with an increase in privately insured patients which provided higher reimbursements than did Medicare, suggesting that selective marketing efforts were successful in increasing margins. Increases in hospital charges resulted in higher out-of-pocket costs for the uninsured and for those who were receiving care out-of-network. Even in-network insured patients produced higher net incomes since negotiating leverage was greater for the private equity hospitals. After acquisition, “private equity firms began charging more for services, cutting operating costs, or both.” After acquisition, the private equity hospitals reportedly saw sicker patients warranting higher charges, but this likely represented more aggressive coding – upcoding just as we see with the private Medicare Advantage plans that result in increases in net income. These private equity-acquired hospitals also supposedly showed greater improvements in process quality measures when, in fact, this actually likely represented gaming in an effort to maximize opportunities for quality bonuses under pay-for-performance contracts.

The medical-industrial complex is more than ripe for equity investors. As if the greed in the system was not already excessive, bringing in the equity investors to squeeze more out of our overpriced and underperforming system is exactly what we should not be doing.

We really do need the single payer model of an improved Medicare for All, but if the stalling by our political leaders in both major parties continues, the economic structure of our health care delivery system will be damaged as with a blunderbuss to the degree that it may be hard to distinguish it from the economic structure of a war zone in need of a Marshall Plan. Really. Private equity acquisition is only one small example of the damage being done throughout the health care economic infrastructure – damage that will be very difficult to repair.

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By William Cummings
USA TODAY, August 23, 2020

Americans view the severity of the coronavirus pandemic and the effectiveness of the government’s response through a very partisan lens, a CBS News/YouGov poll released Sunday found.

More than 176,000 people in the U.S. have died from COVID-19. According to the poll, a 57% majority of registered Republican voters consider that number “acceptable” when “evaluating the U.S. efforts against the coronavirus pandemic,” compared with 31% of voters overall. Ninety percent of Democrats and 67% of independents said the death toll was “unacceptable.”

When asked about the survey Sunday on CBS News’ “Face the Nation,” and why there was such a discrepancy between how Republicans other voters view the pandemic, Republican National Committee Chairwoman Ronna McDaniel said it was “a really unfair poll.”

“Republicans do not want to see people suffering from this pandemic. We have all been affected by this. This is not a Republican or Democrat issue,” McDaniel said.

https://www.usatoday.com…

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CBS News Battleground Tracker – YouGov, August 19-21, 2020
Sample 2,226 Registered Voters, Margin of Error ±2.4%

15. In evaluating the U.S. efforts against the coronavirus pandemic, do you consider the number of U.S. fatalities from coronavirus so far to be…

Liberal

• 8% Acceptable
• 92% Unacceptable

Moderate

• 26% Acceptable
• 74% Unacceptable

Conservative

• 57% Acceptable
• 43% Unacceptable

Democrat

• 10% Acceptable
• 90% Unacceptable

Independent

• 33% Acceptable
• 67% Unacceptable

Republican

• 57% Acceptable
• 43% Unacceptable

https://drive.google.com…

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The White House, Press Briefing, March 23, 2020

President Trump: We have jobs, we have — people get tremendous anxiety and depression, and you have suicides over things like this when you have terrible economies. You have death. Probably and — I mean, definitely would be in far greater numbers than the numbers that we’re talking about with regard to the virus.

https://www.whitehouse.gov…

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Comment:

By Don McCanne, M.D.

It is absolutely shocking that 8% of liberals and 10% of Democrats find the number of U.S. fatalities from coronavirus to be acceptable. But 57% of conservatives and 57% of Republicans – over half – do find such deaths to be acceptable. Really? Professing to be the pro-life party, this comes as a quite a revelation.

In defense, Republican National Committee Chairwoman Ronna McDaniel said this was “a really unfair poll.” How is that? Reviewing the entire poll to see what might be unfair, a couple of points can be made. One is that those polled were not told that the number of deaths was 176,000, but if withholding that fact was unfair, it would suggest that 90% of Democrats would find any coronavirus deaths to be unacceptable whereas 57% of Republicans would tolerate a much larger number of deaths.

Two questions earlier, over half of the Republicans and conservatives rated Donald Trump as doing a “very good” job in handling the coronavirus outbreak. The question on fatalities was qualified by, “In evaluating the U.S. efforts against the coronavirus pandemic…” Since the majority of Republicans responding had already said that Trump was doing a very good job with the pandemic, it made it more difficult for them to agree that the number of deaths was unacceptable. Perhaps the Republicans felt that this was entrapment and thus made the poll unfair.

Also, the view was often expressed by Trump’s advisers and the conservative media, especially Fox, that the damage to the economy was greater than the damage caused by the virus, and thus it was more important to “open up” the economy in spite of reported death rates. Even Donald Trump expressed the view that deaths from a terrible economy “definitely would be in far greater numbers than the numbers that we’re talking about with regard to the virus.”

Regardless, comparing the morality of an allegedly unfair poll with that of 176,000 deaths, there is no contest. We should elect politicians who understand the difference.

PNHP does not endorse any political parties nor any candidates for political office; rather we endorse health care justice for all.

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By Brian J. Miller Robert E. Moffit
Health Affairs Blog, August 20, 2020

The renewed national health care debate represents a conflict of visions of how to create better value: government central planning versus patient-centered, consumer-driven competition.

Market-driven approaches based upon defined-contribution financing (premium support), the states as insurance laboratories, and addressing the employer-sponsored insurance (ESI) tax exclusion would all serve to increase competition and engender insurance affordability and portability.

Previous legislative attempts at solving cost and access challenges in health policy have viewed health insurance and care delivery markets through a national lens, focusing on standardizing benefits and care delivery. As any patient or clinician will volunteer, health care markets are intensely local, and policy solutions must navigate the complex interplay of local, state, and federal stakeholders.

Recent progressive health policy efforts remain firmly anchored in a political philosophy that champions national regulation and central control, sitting in direct conflict with consumers who strive for mass-customized health care. Currently, consumers and clinicians are persistently frustrated, as both strive for choice, flexibility, and modernity in an otherwise dysfunctional system. In selecting health benefits, consumers face an impossible task: to predict their trajectory as patients, a challenge when the healthy office worker one day can become a terminal cancer patient the next. In this setting, a single benefits package is at its core unfair—a person’s needs change over time, and they should be able to change and customize their coverage as they progress through different stages of life.

Part I:
https://www.healthaffairs.org…

Part II:
https://www.healthaffairs.org…

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Comment:

By Don McCanne, M.D.

Universal publicly-administered and publicly-financed health care programs work well for everyone. In contrast, the most expensive health care system of all – ours – uses a fragmented system of administering and financing that includes choice and competition of private insurers, and that has been a disaster, leaving tens of millions with inadequate coverage or no coverage at all.

It is difficult to understand the obsession with injecting consumer-driven choice and competition into the mix when the private plans and the burden they place on the health care delivery system have defeated the goals of universality, equity, efficiency, affordability, accessibility, and social solidarity. Yet here we have another article advocating for this market-driven approach.

Although this two-part article repeats many of the usual conservative talking points, the excerpt above reveals a fundamental flaw in their premises that alone shoots down their model of reform. They seem to understand that it is not the choices in health care itself that makes the market work but rather it is the choices in private insurance products that they seem to believe makes the health care market effective. They claim that a single benefits package that applies to everyone is unfair because “a person’s needs change over time, and they should be able to change and customize their coverage” to fit their needs. So they provide the example of “the healthy office worker one day can become a terminal cancer patient the next,” though they concede that consumers face an impossible task in predicting their trajectory as patients. Even if you knew you had a specific cancer, you could not purchase coverage for that cancer alone because the insurers must pool risk, and if such a product even existed, it would have to be sold to people without that cancer. Otherwise that insurance product would have to include the full costs of the care for that malignancy plus the administrative costs and profits of the insurer. Retail plus maybe twenty percent is not a bargain that would find a niche in the marketplace. Selecting in the market only the insurance you need is impossible.

We really don’t need these analyses anyway. Not only do we have the most expensive system of all nations, though we leave tens of millions out in the cold, private insurance is the most expensive component of health care financing when adjusted for the health of those covered. Of course, that’s how insurance markets work, selectively sell to the healthy while shoving the sick into government programs or simply into the street. That is why all that money we are already spending on health care plus insurance administrative costs is still leaving so many facing financial hardship or, even worse, leaving them with physical suffering or death due to lack of health care.

Throw out the private insurers, recover the wasted funds, establish a single universal risk pool, and then take care of all of us through our own public, single payer model of Medicare for All. Simple.

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