PNHP

It’s time for Democrats to get their facts right on Medicare-for-all

It’s time for Democrats to get their facts right on Medicare-for-all

By Pramila Jayapal
Washington Post, August 1, 2019

In the wake of the second Democratic presidential debate, it is clear that Medicare-for-all has become a defining issue of the 2020 election. Earlier this year, when I introduced our comprehensive, 120-page “Medicare for All Act of 2019,” I expected attacks from big pharma and for-profit insurance companies. But I did not expect misrepresentations from Democratic presidential candidates about what the bill is and is not.

Let’s be clear about the scale of this crisis. The United States currently spends an astronomical $3.6 trillion per year on health care — almost double what peer countries spend — and it is set to increase within 10 years to $6 trillion annually. Pharmaceuticals such as basic insulin cost up to 10 times less in Canada for the exact same drugs. Approximately 500,000 Americans turn to bankruptcy each year because they cannot afford medical costs — and that includes people with insurance.

With so much at stake, facts matter. So let’s get them right.

First, it is a myth that Americans love private insurance. The vast majority of Americans are deeply frustrated with the health-care system — even if they have private insurance. Opponents and pundits often quote polling that suggests support for Medicare-for-all drops when you tell people that their private insurance plan would go away. But when polls accurately describe Medicare-for-all, and explain that you can keep your doctor or hospital, the majority support increases. People are happy to get rid of private insurance; they just want to know they can keep their doctors and hospitals, even if they switch or lose their jobs. Medicare-for-all would let them do so.

Second, it’s wrong to assert that taxes will rise without talking about what health care currently costs Americans in premiums, co-pays and deductibles. The average American family with employer-sponsored insurance incurs more than $28,000 dollars in health-care costs per year, of which about $15,800, or 56 percent, is paid by employers. And many argue they still can’t get the care they need. Americans are smart enough to be asked questions like: Would you be willing to pay more in taxes each month if you saved more money by not paying private insurance premiums, deductibles and co-pays and were guaranteed high-quality health care?

Third, it is simply false that labor unions don’t want Medicare-for-all. Sure, they fought hard for employer-sponsored health insurance plans for their workers. But they, above all others, recognize that the rising costs of insurance premiums are directly related to stagnating wages and, more and more, the pressure of those costs hurts worker power at the bargaining table. Take a look at the unprecedented number of unions that have endorsed our bill, all of which know Medicare-for-all is necessary.

Fourth, comparisons of Medicare-for-all to the GOP’s push to “repeal and replace” the Affordable Care Act are simply unfounded. Republicans are the only ones trying to take away health care. There is absolutely no daylight between leading on Medicare-for-all and fighting to shore up the ACA right now, or stopping the GOP from stripping care away. The Affordable Care Act made profound improvements to our health-care system. But it was never meant to be the end goal, since it does not address the real disease in our system: a profit motive that leaves millions either without access to care, bankrupt or unable to afford medication in the world’s richest country. We can strengthen the ACA and work toward Medicare-for-all at the same time. Even former president Barack Obama agrees.

Fifth, we simply cannot expect to bring down the costs of health care in the United States without taking on the for-profit insurance and pharmaceutical corporations, which are raking in billions of dollars at the cost of American lives. Incremental steps such as a public option might sound appealing but would still leave more than 10 million people without coverage while keeping in place a costly private-insurance middleman that eats up 25 to 30 percent in administrative waste and profits. If we want to achieve true universal health care while containing costs, Medicare-for-all is the only answer.

Finally, Democratic candidates should stop using one-liners from industry front groups and Republican playbooks — such as “Medicare-for-all would shutter hospitals,” or telling seniors that “Medicare goes away as you know it. All the Medicare you have is gone.” These claims — amplified by contributions from the private health-care industry — are designed to incite fear and sow confusion. I’ve spoken with several hospital CEOs who see Medicare-for-all as a lifeline for their hospitals — particularly safety-net and rural hospitals that are barely surviving under the current system. And my Medicare-for-all bill improves Medicare for seniors by adding additional benefits such as dental, vision, hearing and long-term care.

As the debates continue, I hope that my fellow Democrats will take a good look at our bill and get the facts right. The Medicare-for-all movement has overwhelming public support, unprecedented grass-roots organization, and a serious plan that is ready to change our health-care system right now.

Health care is the top issue for voters, and they deserve to know the truth about the solutions we are proposing. I’m willing to debate Medicare-for-all with anyone — but we owe it to all Americans to stick to the facts.

Pramila Jayapal, a Democrat, represents Washington’s 7th Congressional District in the U.S. House.

https://www.washingtonpost.com…

A for-profit company bought, then closed, a Philadelphia hospital. Medicare for All could have saved it.

Hahnemann University Hospital in Philadelphia is slated to close in September, less than two years after a private equity firm bought it.

By Walter Tsou, M.D., M.P.H.
Tarbell, August 1, 2019

Fifty-four years ago, President Lyndon Johnson went to Independence, Mo., to present the first Medicare cards to President and Mrs. Harry Truman and to sign the Medicare Act of 1965.  Said Johnson, “Through this new law . . . every citizen will be able, in his productive years when he is earning, to insure himself against the ravages of illness in his old age. This insurance will help pay for care in hospitals, in skilled nursing homes, or in the home. And under a separate plan it will help meet the fees of the doctors.”  Thus was born the most successful and popular health insurance program in the U.S., Medicare. It was a time of remarkable affirmation of the role of government in offering protections to its citizens – civil rights, voting rights, Medicare and Medicaid, among others – all passed under the signature of President Johnson.

In the ensuing years, we have seen a diminishing role of government in protecting health care and the rise of entrepreneurship and for-profit medical care. Health care news is reported as business, and the majority of Americans are confused by the new business lexicon of health care – “copays, deductibles, networks, prior authorizations, EMRs, etc.”  Everyone agrees that the cost of health care is too high. It is the leading cause of personal bankruptcy – the “crime” of getting sick and being unable to pay your medical bills. And to add insult, the majority of those who go bankrupt have health insurance but have the misfortune of being “out of network” or “denied coverage” or unable to cover copays and deductibles.

The for-profit American Academic Health System bought Philadelphia’s Hahnemann University Hospital and St. Christopher’s Hospital for Children in 2018, keeping them afloat but extracting what profit it could.  In July, American filed for Chapter 11 bankruptcy. St. Christopher’s, a profitable entity, will be sold. Unprofitable Hahnemann appears to be more valuable for its location than as a safety-net hospital to its owners.  After 134 years, the hospital is shutting down, leaving a huge void in the medical care of city residents, particularly the poor.

According to a recent CNN report, as Hahnemann’s shutdown proceeds, another hospital in downtown Philadelphia, Thomas Jefferson University Hospital, is seeing as many as 290 emergency room patients a day, up from 175. Jefferson’s maternity ward, anticipating a delivery rate of 1,800 for the year, now expects to handle about 2,800 births. The hospital’s president told CNN most of these new patients are on Medicaid.

Government has failed here on several levels.  Unwisely, Hahnemann was never zoned as a hospital area, ensuring that any entrepreneur could buy the property, conveniently located near the Pennsylvania Convention Center, and convert it into yet another luxury condominium or hotel.  Medicare and especially Medicaid reimbursement are simply too low. Some say that this is proof that Medicare for All would bankrupt hospitals, but actually it would do the opposite – pay hospitals a guaranteed amount on a global budget and free hospitals from the multimillion dollar expense of hiring hundreds of billing personnel. It is more than likely that Hahnemann would still be operational if it had a guaranteed global budget payment system.

Philadelphia has become not only a destination for college graduates but also for suburban empty-nesters who are moving to Center City for its arts, culture, transportation and, wait for it . . . medical care.  We are getting older, and close proximity to medical care is a huge draw for wealthy retirees who would love to plant their dollars in our city. The current building boom downtown has left the city with plenty of condos but a dwindling number of hospitals.

Medicare’s 54th anniversary reminds us that government once saw its role of ensuring a safety net for its citizens as part of a series of rights:  civil, voting, health. Sadly, the government has deferred its role to the entrepreneurs who have taken over health care, leaving all Americans to fend for ourselves and without a net.  We need to protect those who protect us, and we must do that by prioritizing health care in our zoning, our reimbursements, our regulations and our laws.

Dr. Walter Tsou is a national board advisor to Physicians for a National Health Program; an adjunct professor of family and community health at the University of Pennsylvania; former Philadelphia Health Commissioner (2000-2002), and a past president of the American Public Health Association.

https://tarbell.org…

Medicare for All Explained Podcast: Episode 17

Interview with Jonathan Michels

August 1, 2019

Radiology technician and premed student Jonathan Michels discusses the student-led movement to pressure the American Medical Association to reconsider its regressive stance on single-payer Medicare for All. Hosted by Joseph Sparks. Additional episodes will be uploaded twice monthly. Subscribe in iTunes, or access a complete archive of the podcast, below.

https://medicareforallexplained.podbean.com

After Last Night’s Debate, A Deep Dive On Medicare For All

Interview with Dr. Paul Song

By Larry Mantle
KPCC, AirTalk, July 31, 2019

Last night’s Democratic presidential debates included a discussion on health care reform.

Perhaps one of the most notable moments was when former Maryland congressman John Delaney questioned the feasibility of Medicare for all and Senators Bernie Sanders and Elizabeth Warren came back with sharp responses.

But neither Sanders or Warren addressed Delaney’s criticism of their plan.

To grapple with the various strategies candidates presented at last night’s debates for implementing Medicare for all, Larry sits down with three health care experts.

Guests:

Kavita Patel, M.D., non-resident senior fellow at The Brookings Institution and primary care physician; she served in the Obama administration as director of policy for the Office of Intergovernmental Affairs and Public Engagement in the White House.

Avik Roy, president of The Foundation for Research on Equal Opportunity, a non-profit think tank, policy editor at Forbes and former policy advisor to Marco Rubio, Rick Perry and Mitt Romney.

Paul Song, M.D., radiation oncologist and President of the California chapter of Physicians for a National Health Program.

full audio here:
https://www.scpr.org…

A Medicare for All monopsony would get the prices right

The Opportunities and Limitations of Monopsony Power in Healthcare: Evidence from the United States and Canada; NBER Working Paper 26122

By Jillian Chown, David Dranove, Craig Garthwaite, and Jordan Keener
National Bureau of Economic Research, July 2019

Abstract

Perhaps more than any other sector of the economy, healthcare depends on government resources. As a result, many healthcare systems rely on the use of government monopsony power to decrease spending. The United States is a notable exception, where prices in large portions of the healthcare sector are set without government involvement. In this paper we examine the economic implications of a greater use of monopsony power in the United States. We present a model of monopsony power and test its predictions using price differences between the United States and Canada – a country that represents an example of a “Medicare for All” style system. Overall, we find that wage differences for medical providers across the two countries are primarily driven by the broader labor market while price difference for prescription drugs are more directly the result of buyer power. We discuss theoretical reasons why a Canadian monopsonist may be more willing to exploit its buyer power over prescription drugs rather than provider wages and why a U.S. monopsonist might not be willing to do the same.

From the Introductory Comments

Health care spending varies markedly across countries. It is widely accepted that at least a portion of spending differences results from the willingness and ability of governments to exercise monopsony power when purchasing healthcare goods and services. Broadly speaking, governments that finance healthcare services often use their buyer power to push down the prices paid for healthcare inputs such as pharmaceutical products, medical devices, and the wages of medical providers. Differences in the willingness and ability to exercise buyer power certainly contributes to the considerable healthcare price and wage dispersion across countries. However, the degree to which these price differences across countries are the result of buyer power as opposed to other economic forces is an open question that we explore in this paper.

At an aggregate level, the United States stands at an extreme of a relatively parsimonious government role in the financing of healthcare services, a limited use of government buyer power, and a relatively large percentage of its economic activity occurring in the health sector. Concerned about the rising cost of U.S. healthcare, many policymakers have proposed that the federal government make greater use of its buyer power. Proposals include various “Medicare-for-All” policies that would expand existing public insurance systems to cover more than simply the elderly, poor and disabled, as well as more limited proposals, such as requiring Medicare to use its size to negotiate lower pharmaceutical prices. The economic effects of a greater use of monopsony power obviously depend on the specifics of the proposed policy reform. While proponents have offered a variety of “Medicare-for-all” alternatives, we will use the term in this paper to refer to a truly single payer system where no private insurance options exist. Under this option, which has been proposed by numerous policymakers, the federal government would be the single purchasing agent for all Americans.

The potential savings from implementing such a single payer system would primarily come from two sources: (1) decreased administrative costs resulting from a single firm providing health insurance and (2) the exercise of buyer power to reduce input prices. We will briefly discuss the former before moving on to the latter, which is the main focus of this paper.

Centralizing insurance in a single entity would certainly eliminate some duplicative administrative functions. In addition, a single insurer that lacked competitive pressures would likely have lower marketing expenses.

While administrative expenditures are a potential source of savings, a single payer aiming to meaningfully reduce spending would, by necessity, follow the proverbial “Willie Sutton” rule of health spending and target the prices paid to healthcare inputs such as medical providers and pharmaceuticals. These input prices represent the bulk of U.S. healthcare spending with labor costs comprising approximately 60 percent (Kocher and Sahni, 2011) and pharmaceuticals accounting for an additional 15 percent. A government payer could cut both of these prices either by directly reducing the fees paid to physicians, other medical personnel, and pharmaceutical manufacturers or by reducing payments to hospitals and other institutions, which would then have to reduce their costs (i.e., cut wages and reduce other medical inputs) to remain financially viable.

Proponents of an expanded use of government buyer power frequently cite the experiences of other developed countries that have both far more extensive government involvement in healthcare and lower health spending. Within these comparisons, the Canadian system is perhaps the most similar to Medicare-for-all. In Canada, provincial governments offer health insurance and finance care delivery under rules established by the government, but medical services are mostly provided by private providers in privately owned and operated facilities. The similarity of the Canadian system to many U.S. proposals for Medicare-for-all can perhaps be most clearly seen in Senator Bernie Sanders (I-VT) explicit statements that the Canadian system is a model for his widely discussed universal coverage proposal (Kliff 2017). Thus, the decisions of Canadian insurers provide perhaps the best evidence of the potential optimal savings available from the creation of a single monopsonist in the United States.

In this paper, we present a simple theoretical model to predict the optimal decisions of a healthcare monopsonist such as Canada. We then use price data across the U.S. and Canada to empirically test the predictions of this model to help understand the scope of savings optimally available to a similar monopsonist in the United States.

The predictions of the model suggest the optimal exercise of market power will differ based on both the relative size of the monopsonist in the relevant market and the resulting elasticity of supply it faces. We test the predictions of this model using U.S. and Canadian price data for two key inputs of healthcare services: prescription drugs and medical providers.

Given our model predicts a different response based on the monopsonist’s relative market size (and therefore the respective elasticity of supply), it predicts different exercises of market power across these two input markets. Specifically, our model predicts the Canadian monopsonist would exercise more of its market power for pharmaceuticals than for labor.

We find evidence that the Canadian monopsonist does exercise buyer power with respect to drugs. Using highly detailed pricing data that has not been previously studied for this purpose, we estimate that for a consistent basket of pharmaceutical goods, Canadian consumers pay 54 percent less than Americans.

Our analysis finds that Canadian drug prices are 54 percent lower – a difference that is far greater than for other goods and services. We interpret this as evidence that Canadian provincial governments are willing and able to exercise monopsony power over drugs to a greater degree than in the labor market – which is consistent with our monopsony model’s predictions.

The fact that Canadian wages for highly skilled employees show limited evidence of an exercise of buyer power while prescription drug prices indicate a large role for the public payer’s negotiations suggests that Canadian policymakers carefully consider the potential consequences of exploiting monopsony power in healthcare markets. For products where Canadian consumers represent a relatively small part of the market, such as prescription drugs, policymakers have the freedom to exploit buyer power without meaningful consequences – and they do. In contrast, in labor markets, Canadian policymakers must contend with the fact that if they use their negotiating power to push down input prices it could have large and potentially harmful short and long term consequences for healthcare labor supply.

From the Conclusions

In this paper, we examine the role of monopsony power in healthcare markets by comparing prices and quantities of healthcare inputs in Canada and the United States. We provide a theoretical framework and empirical evidence for the optimal behavior of a monopsonist. We focus on two critical inputs to the healthcare production function that illustrate key features of the theoretical model – labor and prescription drugs. In line with the theoretical expectations we outline, we find that the Canadian monopsonist is more willing to exploit its market power over prescription drugs than provider wages.

Examining a market basket of prescription drugs, we find that prices in Canada are 54 percent lower than in the U.S. This price differential is much larger than the general cost-of-living differences between the two countries, which we interpret as evidence that the Canadian monopsonist is willing to use its power to lower the cost of this particular medical input. This is in line with our theoretical expectations: because Canada represents a small share of the global drug market, policymakers are able to exploit their buyer power without incurring broader consequences, such as reducing innovation.

In contrast, we find that the differential in provider wages between the U.S. and Canada can largely be explained by differences in the prevailing labor market conditions, implying that the Canadian monopsonist is not willing to exercise the full scope of its buyer power for this input. In particular, we find that Canadian medical workers earn about 24 percent less than their American counterparts. If this was solely the result of profligate U.S. health spending, we should expect that U.S. providers would not only be paid more than their Canadian counterparts but also relatively more than other highly skilled professionals in the United States. This is not the case. We primarily attribute differences in wages for U.S. medical providers to the structure of the broader labor market; i.e., U.S. providers are paid more than in Canada because all highly skilled U.S. professionals are paid more than in Canada. In particular, high skilled healthcare workers in Canada make about 26 percent less than similar workers in the United States, while high skilled non-healthcare workers make 22 percent less. Thus, the vast majority of the 26 percent wage differential likely reflects overall labor market conditions. The remaining 4 percentage point differential between healthcare and other professional wages may reflect a variety of factors—potentially including inefficiencies in the U.S. system that provide excess wages to healthcare providers or a choice by the Canadian monopsonist to exploit some of its market power.

Our findings are consistent with the idea that the Canadian monopsonist believes that a substantial reduction in the wages of physicians and other healthcare workers could cause a reallocation of talent across the economy. This is true even conditional on similar individuals receiving medical training. These individuals have a number of opportunities beyond clinical practice, and there are some reports physicians are increasingly choosing these options (Mostue 2017). Perhaps more concerning would be a reallocation of talent out of medical training altogether. For example, if the U.S. took steps so that its physicians were paid the same as Canadians, this would move physicians from the second highest paid profession in the U.S. to the eighth highest paid profession — situated just above computer engineers, mathematicians and biomedical engineers. This change in relative pay could push many talented young individuals considering medicine into entirely different fields. Given this concern, it should perhaps not be surprising that even the Canadian monopsonist does not appear to have chosen to meaningfully exercise its wage setting power. In Canada, as in the United States, physicians and surgeons are among the highest paid employees in society.

Taken together, our findings should temper the expectations of anyone who believes that Medicare-for-all will drive U.S. health spending to Canadian levels. Most health spending goes toward labor expenses. Returning to the Willie Sutton analogy, while labor is “where the money is,” a U.S. monopsonist might find, just as in Canada, that it is not worth “robbing the bank” by lowering labor expenses, as this would drive highly skilled workers into other fields. And while the U.S. monopsonist could drive down drug prices to levels at or below those in Canada, it might be tempered by concerns about disruptions to long term drug supply, a problem not shared by the much smaller Canadian monopsonist.

https://www.nber.org…

Comment:

By Don McCanne, M.D.

In the debate over the proposal for a single payer model of Medicare for All, the claim is often made that giving the government that much power to set prices (functioning as a monopsony – a single purchaser of health care) would drive physicians and hospitals into insolvency thus decreasing access to health care. This NBER paper is important because it shows what is actually happening in Canada under its single payer model of health care financing and what might happen in the United States under a single payer Medicare for All monopsony.

Many studies have shown that much of the administrative waste that characterizes the health care financing system in the United States would be recoverable under a single payer system. But a single payer would also have the monopsonistic power to drive down prices, potentially saving even more funds. So how has Canada, with its Medicare for All-like system, utilized its monopsonistic power?

Canada has driven down drug prices so that they are 54 percent lower than in the United States. They have been able to do that since their drug market is only about one-tenth of that in the United States, thus there is no fear that lower profit margins would have any impact in suppressing new drug innovation. This fear of suppressing innovation has been expressed repeatedly in the United States considering our very large drug market, but other factors not addressed here suggest that the costs of drug innovation do not justify the price gouging that is taking place in the U.S.

What is particularly striking in this paper is that Canada is not using its monopsonistic power to drive down wages and salaries in the health care industry to levels that are comparable to those in our traditional Medicare program. Rather they are pricing health care wages based on prevailing labor market conditions.

In the United States, Medicare has exercised its monopsonistic power to drive prices down to levels that some claim to be below costs. It is the private insurance sector that has been complicit with driving prices up, and Medicare has been able to offset some of the excessive pricing through its monopsonistic leverage.

Private insurers have at least two incentives to drive up prices. Revenue in excess of medical losses (costs of patient care) are retained by the insurer to fund their own administrative costs and to provide profits. Their primary product is administration and the more administrative services they can sell, the better for them. So private insurers contribute directly to high health care costs in the U.S. both by driving up prices and by generating ever more administrative waste.

But in Canada, the public stewards are pricing health care at a level that ensures an adequate health care labor supply yet not wasting taxpayer funds on excessive prices. Further, through the administrative simplicity of the single payer model, they are not wasting financial resources that are better used for patient care,

In the United States, we are now seeing a softening of the demand to enact single payer Medicare for All while at the same time we are seeing the manipulation of public opinion in support of ensuring the preservation of the option to choose private insurance plans. This is backwards. The private insurers are in the business to increase their revenues (waste our funds) whereas publicly financed and administered systems are public service systems that have a mission to provide us with the greatest value in health care. They can do that with a monopsony that gets the prices right by balancing legitimate costs with patient needs. The private insurers will not do that for us.

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The challenges of a Medicare public option for the private insurance market

How a Medicare Buy-In or Public Option Could Threaten Obamacare

By Reed Abelson
The New York Times, July 29, 2019

It seems a simple enough proposition: Give people the choice to buy into Medicare, the popular federal insurance program for those over 65.

Former Vice President Joseph R. Biden Jr. is one of the Democratic presidential contenders who favor this kind of buy-in, often called the public option. They view it as a more gradual, politically pragmatic alternative to the Medicare-for-all proposal championed by Senator Bernie Sanders, which would abolish private health insurance altogether.

A public option, supporters say, is the logical next step in the expansion of access begun under the Affordable Care Act, passed while Mr. Biden was in office. “We have to protect and build on Obamacare,” he said.

But depending on its design, a public option may well threaten the A.C.A. in unexpected ways.

A government plan, even a Medicare buy-in, could shrink the number of customers buying policies on the Obamacare markets, making them less appealing for leading insurers, according to many health insurers, policy analysts and even some Democrats.

In urban markets, “a public option could come in and soak up all of the demand of the A.C.A. market,” said Craig Garthwaite, a health economist at the Kellogg School of Management at Northwestern University.

And in rural markets, insurers that are now profitable because they are often the only choices may find it difficult to make money if they faced competition from the federal government.

Some insurers could decide that a smaller and uncertain market is not worth their effort.

If the public option program also matched the rates Medicare paid to hospitals and doctors, “I think it would be really hard to compete,” Mr. Garthwaite said. Even leading insurers do not have the leverage to demand lower prices from hospitals and other providers that the government has.

The A.C.A. is now a solidly profitable business for insurers, with several expanding options after earlier threats to leave. For example, Centene, a for-profit insurer, controls about a fifth of the market, offering plans in 20 states. It is expected to bring in roughly $10 billion in revenues this year by selling Obamacare policies.

In spite of stock drops because of investors’ concerns over Medicare-for-all proposals, for-profit health insurers have generally thrived since the law’s passage.

But a buy-in shift in insurance coverage could profoundly unsettle the nation’s private health sector, which makes up almost a fifth of the United States economy. Depending on who is allowed to sign up for the plan, it could also rock the employer-based system that now covers some 160 million Americans.

Some experts predict that private insurers will adapt, while others warn that the government could wind up taking on the sickest customers with high medical bills, leaving the healthier, profitable ones to private insurers.

One variant of the public option — letting people over 50 or 55 buy into Medicare — is often depicted as less drastic than a universal, single-payer program. But this option would also be problematic, experts said.

This consumer demographic is quite valuable to insurers, hospitals and doctors.

Middle-aged and older Americans have become the bedrock of the Obamacare market. Some insurers say this demographic makes up about half of the people enrolled in their A.C.A. plans and, unlike younger people who come and go, is a reliable and profitable source of business for the insurance companies.

The aging-related health issues of people in this group guarantee regular doctor visits for everything from rising blood pressure to diabetes, and they account for a steady stream of lucrative joint replacements and cardiac stent procedures.

Several experts said that designing a buy-in program that is compatible with the existing public and private plans could be daunting.

“You’d have to do it carefully,” said Representative Donna Shalala, a Florida Democrat who served as the secretary of health and human services under President Bill Clinton.

Linda Blumberg, a health policy expert at the Urban Institute, a nonpartisan think tank, agreed. “The idea of Medicare buy-ins was taken very seriously before there was an Affordable Care Act,” she said. “In the context of the A.C.A., it’s a lot more complicated to do that.”

Blue Cross plans could lose 60 percent of their revenues from the individual market if people over 50 are shifted to Medicare, said Kris Haltmeyer, an executive with the Blue Cross Blue Shield Association, citing an analysis the company conducted. He said it might not make sense for plans to stay in the A.C.A. markets.

Siphoning off such a large group of customers could also lead to a 10 percent increase in premiums for the remaining pool of insured people, according to the Blue Cross analysis. More younger people with expensive medical conditions have enrolled than insurers expected, and insurers would have to increase premiums to cover their costs, Mr. Haltmeyer said.

Dr. David Blumenthal, the president of the Commonwealth Fund, a foundation that funds health care research, said a government plan that attracted people with expensive conditions could prove costly.

“You might, as a taxpayer, become concerned that they would be more like high-risk pools,” he said.

Jonathan Gruber, an M.I.T. economist who advised the Obama administration during the development of the A.C.A., likes Mr. Biden’s plan and argues there is a way to design a public option that does not shut out the private insurers.

“It’s all about threading the needle of making a public option that helps the failing system and not making the doctors and insurers go to the mat,” he said.

While Ms. Shalala supports a public option as an alternative to “Medicare for All,” she is clear about how challenging it will be to preserve both Obamacare and the private insurance market. “You can’t do it off the top of your head,” she said.

https://www.nytimes.com…

Comment:

By Don McCanne, M.D.

To many, the debate about health care reform does not seem very complicated. Prevailing thought seems to be that we should leave employer-sponsored plans alone, allowing people to choose them if they want. We should also allow individuals to purchase a newly-created Medicare public option if that is their preference. Some would still prefer single payer Medicare for All as a plan that covers everyone since that would resolve health care coverage issues forever, though the KFF poll released today shows that 55% of Democrats would prefer building on the existing Affordable Care Act whereas only 39% would prefer replacing is with a national Medicare for all plan, whereas 62% of Republicans oppose even a public option. So it seems that we should use the democratic process to see which route the majority prefers and then go with that.

But the message in Reed Abelson’s New York Times article shows that it is not that simple. The policy considerations behind the various approaches are very complex. They mostly boil down to the fact that fragmenting the health care financing system introduces inefficiencies, inequities, and profound administrative complexities which divert an inordinate amount of funds from actual patient care, and leave many without the care they need.

What is somewhat instructive are the separate views of Jonathan Gruber and Donna Shalala, both of whom have had considerable experience with our health financing system. They both express the view that reform should preserve the role of private insurers (but why?). Gruber says, “It’s all about threading the needle,” whereas Shalala says, “You can’t do it off the top of your head.”

Preserving the private insurance sector creates a tremendous policy challenge that can be negotiated only by compromising on efficiency, effectiveness and equity, while agreeing to greatly expand our health care spending – already by far the highest in the world.

Why does the policy community keep trying to sideline the definitive model that would work best for all of us – single payer Medicare for All? Are people really that enamored over their private plans that nobody is able to keep over the decades anyway (60 million people leave their jobs each year)? Why are we bending over backwards to keep such a dysfunctional system in place?

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‘Medicare For All’ or single payer: Here’s how the 2020 Democrats differ on health care

By Elizabeth Thomas
ABC News, July 30, 2019

Amid debate over rising medical costs, surprise hospital bills and high prescription drug prices, health care remains a top priority for voters in the 2020 presidential election.

Here are the candidates who have put out proposals so far and what we know about those who have yet to do so. The list doesn’t include every Democratic candidate, but highlights candidates who have significant positions or experience that sets them apart.

The debate on “Medicare for All”, which would overhaul the nations’s current health care system, has begun to sow division in the 2020 field.

According to Politifact, eliminating the private insurance market would “shake up nearly a fifth of the nation’s economy.”

Some candidates are rallying behind the concept, others are against it and some have suggested forming a hybrid system that would call for universal health care while at the same time allowing people to chose private insurance if they want it.

Former Vice President Joe Biden released a plan in July that his campaign said would make the Affordable Care Act easier to navigate with more choices for Americans.

The plan would expand upon the Affordable Care Act passed under the Obama-Biden administration and provide a public, government-run insurance option for consumers to purchase on the existing exchanges with the goal on keeping costs down and expanding access for patients to buy into. This proposal differs from a Medicare for All system that several of Biden’s 2020 rivals advocate for — a contrast the former vice president has already started to draw on the campaign trail.

“We should not be starting from scratch. We should be building from what we have. There is no time to wait. And I that’s why I think, what I’m proposing — and we can do it — is to keep Obamacare, restore the cuts that have been made, and add a public option,” Biden said during an event in Dover, New Hampshire, on Friday. “If they like their employer-based insurance, you get to keep it. The fact of the matter is, all the other proposals make you — you lose it. Period.”

The Biden campaign estimates that the plan will cost $750 billion over 10 years. Senior advisers said Biden would rescind President Donald Trump’s tax cuts for the wealthy, raise the maximum tax bracket to 39% and get rid of the capital gains tax loophole for wealthy families with incomes greater than $1 million a year in order to cover the hefty price tag.

Dr. Phil Verhoef, a board member of Physicians for a National Health Program, told ABC News that he does not believe that building on the Affordable Care Act is the solution to solving a troubled health care system.

“Bidens’ proposal is effectively let’s fix the way the ACA was weakened under the Trump administration and then let’s add a public option on top of that for people to be able to buy in Medicare,” Verhoef said. “The reason that I think this is problematic is it preserves how complex our health care system is right now.”

Shortly after his announcement, Sen. Bernie Sanders, I-Vt., countered Biden via Twitter.

“I fought to improve and pass Obamacare. I traveled all over the country to fight the repeal of Obamacare,” Sanders wrote. “But I will not be deterred from ending the corporate greed that creates dysfunction in our health care system. We must pass Medicare for All.”

In April, Sanders again introduced his signature health care legislation, which if passed and signed into law, would provide government-run, Medicare-style health insurance for all Americans and outlaw most duplicative private insurance in the process.

“The Medicare for All Act will provide comprehensive health care to every man, woman and child in our country without out of pocket expenses. No more insurance premiums, deductibles or co-payments. Further, this bill improves Medicare coverage to include dental, hearing and vision care,” Sanders’ team wrote in a summary of the bill distributed ahead of a press conference on Capitol Hill.

Sanders has introduced the bill several times in the last decade, but the latest version is more sweeping. It now calls for expanded coverage to include and pay for long-term care, as well as no co-pays for doctors visits.

One study last year from the Mercatus Center at George Mason University estimated that Sanders’ legislation could cost the federal government more than $32 trillion dollars over 10 years.

His plan offers few concrete deals on how to pay for the expanded federal system, but in the past the senator has backed significantly higher income taxes for wealthy Americans and businesses in the country.

Fellow 2020 Democratic presidential candidates Sens. Cory Booker, Elizabeth Warren, Kamala Harris and Kirsten Gillibrand have signed on as cosponsors for Sanders’ Medicare-for-all bill in the Senate.

While Harris is a supporter of Sanders’ legislation, his campaign says the plan that she released Monday stops short of what the Vermont senator envisions for Americans.

The key distinction between the two senators’ plans is that Harris still sees the private system playing a role. Her plan is more of a hybrid health insurance system that allows private companies to be able to offer health insurance plans within the Medicare system for consumers.

Harris’ plan also calls for a 10-year transition to a single-payer system while Sanders plan calls for four years.

Harris also pointed out that she views Sanders plan as too tough on the middle-class. She said that she doesn’t like Sanders’ options to tax households making above $29,000 an additional 4% income-based premium. Instead, she is proposing to exempt households making below $100,000, along with a higher income threshold for middle-class families living in high-cost areas.

Sanders’ campaign manager Faiz Shakir criticized Harris’ plan saying it centers on Medicare privatization, insurance executives and introducing more corporate greed and profiteering into the Medicare system.“Call it anything you want, but you can’t call this plan Medicare for All.”

Biden’s campaign also criticized the plan.

“This new, have-it-every-which-way approach pushes the extremely challenging implementation of the Medicare for All part of this plan ten years into the future, meaning it would not occur on the watch of even a two-term administration,” Kate Bedingfield, a Biden deputy campaign manager, said in a statement. “The result? A Bernie Sanders-lite Medicare for All and a refusal to be straight with the American middle class, who would have a large tax increase forced on them with this plan.”

Verhoef said the plan Harris proposed is flawed for a few reasons, most notably is that it still has a role for private insurance companies and is effectively creating Medicare-Advantage plans for everybody.

“She’s basically saying let’s keep private insurers in here and lets heavily regulate what they provide and give people the option of purchasing these heavily regulated Medicare-Advantage plans,” Verhoef said. “The idea that we are really going to regulate insurance companies this much I think is a little bit pie in the sky itself.”

However, Maura Calsyn, managing director of health policy at the Center for American Progress, told ABC News that while there might be political backlash to Harris’ proposal that medical experts like herself view her proposal as a serious one that deserves consideration.

“The vast majority of Americans have private insurance and I think it’s very easy in the abstract to say that everybody should just not worry about transitioning from those plans and that everything will be just fine,” Calsyn said. “I do think that a plan like Kamala Harris’, giving people a choice, is really an important feature and I don’t think its importance can be overstated.”

During the first presidential debate, Sen. Amy Klobuchar, D-Minn., vocalized her support for a hybrid plan which allows uninsured Americans to sign up for a public plan. The public option plans would essentially allow individuals to choose between public insurance plan, like Medicare or Medicaid, or a private insurance plan.

“It’s something Barack Obama wanted to do, which is a public option,” Klobuchar said. “I’m concerned about kicking half of America off their health insurance.”

Former Rep. Beto O’Rourke echoed a similar sentiment saying that he would “preserve choice” by not eliminating private insurance.

Sen. Kirsten Gillibrand, Sen. Julian Castro, Andrew Yang, Michael Bennet, John Delaney and Marianne Williamson have also expressed that they would support private insurance playing some role in the health care system.

An issue that affects candidates and voters nationwide

Candidates supporting a complete overhaul of the health care system might have a tough time winning over voters on this issue. According to a recent Gallup poll, most Americans are happy with their current health coverage.

The poll found that 69% of Americans rate the coverage and 80% rate the quality of the health care they personally receive as “excellent” or “good.”

However, the same poll found that only 34% of Americans view health care coverage in the U.S. in general as positive.

In an ABC News/Washington Post poll released in April, 19% of Americans said that health care is one of the most important issues when voting for president in the 2020 election. Among leaned Democrats, health care ranked as the most important issue with voters, with 29% responding.

The poll also found that Americans, by a 17-point margin, say President Donald Trump’s handling of health care makes them more likely to oppose than support him for a second term.

https://abcnews.go.com…

Dr. Phil Verhoef on “Rising Up With Sonali”

PNHP national board member Dr. Phil Verhoef appeared on “Rising Up With Sonali” on Free Speech TV and Pacifica radio stations on July 30, 2019. He discussed the just-released health care plan from Sen. Kamala Harris that not only preserves, but extends, the role private insurance companies play in the current Medicare program. He contrasted this “Medicare Advantage for All” approach with the single-payer model of Medicare for All.

Imagine…Medicare for All

By Richard Bieser, M.D.
The Denver Post, Letters, July 30, 2019

Medicare will celebrate its 54th birthday on July 30. Ironically, 54 is too young to qualify for Medicare for most people.

Imagine how different our country would be today if we had decided in 1965 that Medicare would cover health care costs for all Americans.

Imagine never needing to choose between seeing a doctor or filling a prescription and paying the rent or putting food on the table.

Imagine not living in fear that you and your family could become impoverished if you were to get sick or injured.

Imagine not having to stay in a job you hate because you’re afraid to lose your health insurance.
Now imagine that all the above has come true for all your neighbors, all across this country, and that one of the strongest reasons for the profound level of inequality in our country has been removed.

Imagine that American life expectancy and infant mortality are among comparable democracies, rather than among the worst, and that real people in real families have healthier and longer lives.

Imagine being proud that, in our country, we provide care to all who need it, not just those who can pay for it.

Of course, you have really just been imagining Medicare for All. We made a start 54 years ago. Let’s finish the job.

https://www.denverpost.com…

What can we learn from Kamala Harris’ position on private insurance?

KAMALA HARRIS’ PLAN FOR MEDICARE FOR ALL

KAMALA HARRIS FOR THE PEOPLE, July 29, 2019

(excerpts)

Medicare for All will provide every individual in America with access to comprehensive health care.

HOW DOES THIS PLAN WORK AND HOW WILL WE TRANSITION TO MEDICARE FOR ALL?

Under my Medicare for All plan, we will immediately allow people to buy into a Medicare Transition Plan through an extended 10-year phase-in period.

We will automatically enroll newborns (with an opt-out provision for families with employer-sponsored insurance) and the uninsured into a Medicare Transition Plan, and provide a commonsense path for employers, employees, the underinsured, children, and others on federally-designated programs, such as Medicaid or the Affordable Care Act exchanges, to transition into the Medicare Transition Plan.

Second, after the 10-year transition period, we will have a new Medicare framework where most Americans will be in an expanded and improved public Medicare plan. In my Medicare for All system, similar to Medicare Advantage today, private insurance plans can contract through Medicare and compete with the public Medicare plan. However, these private Medicare plans will be subject to stricter consumer protection requirements than under current law, such as getting reimbursed by Medicare for less than the cost of the public Medicare plan to ensure taxpayers aren’t subsidizing insurance company profits. Americans can then choose whether to stay in the public Medicare plan or opt-into a private Medicare plan.

WHAT ABOUT EMPLOYER-BASED PLANS?

During the transition period, employers can continue to provide private health coverage to employees. However, employers will also have the opportunity to provide health care for their employees through the Medicare Transition Plan, with a shared responsibility payment. Employees will also have the option on their own to buy into the Medicare Transition Plan during the transition period.

Following the transition period, under my Medicare for All system, employers will have the option to provide a private Medicare plan for their employees that will be certified by the Medicare program, similar to how employers can offer Medicare Advantage plans today. Employees could choose to be in that employer Medicare plan, a different private Medicare plan, or the public Medicare plan.

WHAT ABOUT ORGANIZED LABOR AND UNION WORKERS?

Under my Medicare for All plan, union workers will have the option to join Medicare and stop sacrificing wages for better health care. Unions could also continue working with employers to offer a private Medicare plan option or supplemental benefits in addition to the Medicare plan.

DOES YOUR PLAN ELIMINATE ALL PRIVATE INSURANCE?

No. Under my Medicare for All system, the power of big insurance companies will be greatly diminished. After the transition period, private insurance will only exist in two ways:

1) At the end of the day, Americans want to be able to choose their doctor and the care they receive, not the insurance company that provides it. Under my plan, private insurers can compete with the new public Medicare plan, as long as the plans they offer adhere to strict requirements like those laid out below. This would function similarly to how Medicare Advantage operates within the Medicare system today. Today, 35% of seniors are enrolled in private Medicare plans that get paid directly by Medicare and, in fact, 25% of current private Medicare insurance plans are already at or below 95% of Medicare costs.

In my Medicare for All system, Medicare will continue to set the rules of the road for these plans, including price and quality, and private insurance companies will play by those rules, not the other way around. But unlike under the current program, these private Medicare plans will be held to stricter consumer protection standards than they are today, such as getting reimbursed less than what the public Medicare plan will cost to operate, to ensure that they are delivering meaningful value and unable to profit off of gaming consumers or the government.

2) People will be able to purchase supplemental insurance covering services not included under Medicare for All, such as medical insurance for traveling abroad and cosmetic surgery. Employers will still be able to offer their employees retiree supplemental coverage through a private insurance plan.

https://kamalaharris.org/medicare-for-all

Comment:

By Don McCanne, M.D.

Although there had been a surge in support for the single payer model of Medicare for All, that support is now being qualified with the condition that private insurance plans remain an option to an improved Medicare program that would otherwise cover everyone.

Polling organizations have added this qualification to routine polls on Medicare for All, but without asking if there would be a preference for a public plan that would offer more benefits than the typical private plan, with greater choice of physicians and hospitals, and lower costs for most individuals and families. To no surprise, the majority participating in the polls would like to have the option to choose a private plan in addition to having available a guaranteed public plan – Medicare for All.

The media have latched onto this preference for having the option to choose a private plan, but some have expanded it to say that many Americans prefer their private plans and should not have them taken away.

Today’s message is about the concept of not eliminating the option of choosing a private plan. It is not about Kamala Harris’ campaign. The reason she is mentioned is that the media has been pounding on her about whether she would prohibit private plans as an option to Medicare for All. With the second round of debates coming up this week, she would certainly be hit hard on this if she didn’t adjust her message. So, although we are examining her defensive policy adjustment, the changes she is supporting represent the more moderate views of those who would support a Medicare public option instead, along with adjustments to the Affordable Care Act. That is, the changes represent allegedly mainstream views that voters may be looking for in the upcoming primary and general elections.

The issues are complex, and her suggestions add to the complexity. So how do you straighten this all out? Well, she asks to expand the transition to Medicare for All to ten years. But look at what happened to the Affordable Care Act after ten years of political shenanigans. It’s worse than what they began with. The numbers of uninsured have been increasing again, the out-of-pocket costs have become less affordable, and provider networks have markedly narrowed, especially with the largest ACA expansion – Medicaid. Does anyone really believe that the ten year transition would escape political sabotage?

Perhaps even more alarming is that the private insurance options proposed are basically the private Medicare Advantage plans that are being touted as being preferred by seniors. (It is merely because the private plans can offer better benefits by being overpaid at the same time the traditional Medicare program has been neglected, especially by not providing catastrophic protection.) This is fulfilling the dream of the private insurance industry that has been advocating for “Medicare Advantage for All” that places the entire nation in private health plans.

Harris’ proposal does call for the private plans to be paid 5% less than the costs of Medicare, just like the original Medicare + Choice program wherein the private insurers promised that they could provide higher quality at lower costs. It turns out they couldn’t, so the Choice program was terminated and profitable private Medicare Advantage replaced it. We know what happened there. The insurers were very successful in marketing their plans to the healthy while high cost patients were left in the traditional Medicare program. In response, the government then introduced risk adjustment to compensate for the overpayment to the private plans. The plans then expanded the diagnoses codes making their relatively healthy patients seem to be sicker than they were in order to quality for upward adjustments in the payment rates. Thus they are still being overpaid though there is disagreement as to how much. At any rate, the insurance industry is so powerful that you know there is no way that they would be compensated at rates 5% below traditional Medicare payments.

But what about the general principle of using multiple competing private plans as opposed to one single universal risk pool in a single payer Medicare for All program? One of the most important advantages of single payer is that administrative costs are dramatically reduced. Close to half a trillion dollars per year could be recovered by switching our fragmented system to single payer. Splitting up the risk pool amongst a slew of private insurers greatly increases the administrative complexity.

So what about those countries in Europe that they tell us use private plans successfully for their health care financing systems? In a Quote of the Day analysis of a 2011 OECD/WHO report on the Swiss health system, I commented: “It is not clear why so many in the U.S. are enamored of the Swiss health insurance system when this OECD/WHO report confirms that it is highly inefficient and fragmented, with profound administrative waste, inequitably funded, with regressive financing and with wide variations in premiums, has the highest out-of-pocket costs, has an increasing prevalence of managed care intrusions, and is controlled by a private insurance industry that has learned how to game risk selection at significant cost to those on the losing end.” (https://pnhp.org…)

So Kamala Harris might have repaired her debate sound bite on the private insurance option for Medicare for All, but she, and almost everyone else, are sure screwing up the message on single payer policies. Their policy modifications would have tragic results if eventually enacted and implemented, compared to a well designed single payer Medicare for All. (https://pnhp.org…)

As the title of a recent Quote of the Day states, “Do not sacrifice policy for the sake of political expediency.” (https://pnhp.org…)

PNHP does not support any politician or political campaign. This message is intended to reflect only on the wisdom, or rather lack thereof, of offering private insurance plans as an option in a single payer Medicare for All program.

Stay informed! Visit www.pnhp.org/qotd to sign up for daily email updates.

No, Obamacare Did Not Lower U.S. Health Costs

Refuting Ezekiel Emanuel's claims

By Kip Sullivan, J.D. and Stephen Soumerai, Sc.D.
MedPage Today, July 29, 2019

Total healthcare spending in the U.S. has risen relentlessly for the last half-century. Obviously, this cannot go on forever. To curb this disastrous increase in healthcare costs, politicians and their advisors must help the public understand which cost-control policies work and which ones fail. A recent STAT News op-ed by Ezekiel Emanuel, MD, a University of Pennsylvania ethicist and former health policy advisor to President Barack Obama, illustrates how wishful thinking can misinform the public about health policy, in this case, the Affordable Care Act (ACA).

Emanuel’s essay correctly notes that Obamacare reduced the ranks of the uninsured, but his claim that it reduced healthcare spending is false. Emanuel concluded that the ACA, which he helped write, “reduced healthcare spending a total of $2.3 trillion” from 2010, the year the ACA was enacted, to 2017. He went on to make an equally astonishing and erroneous claim about health insurance premiums. He alleged they fell by $1,000 per worker, and “about $4,000” for family coverage from 2010 to 2017.

The figures below reveal at a glance that Emanuel was wildly off the mark on both counts. Figure 1 shows that healthcare spending as a percent of gross domestic product continued to rise after 2010 at about the same rate it has risen for the last 50 years. Figure 2 shows that premiums for family coverage for American workers also rose after 2010 at the same rate as before 2010.

How did Emanuel persuade himself that total spending fell after 2010 when the reverse is true? He did so by dusting off a report published in 2010 by the Office of the Actuary (OACT) of the Department of Health and Human Services that sought to estimate the impact of the ACA on total medical spending over the next decade (2010-2019). The report’s authors virtually shouted at their readers not to rely on it. OACT warned readers its estimate was “subject to much greater uncertainty than normal” and “should be interpreted cautiously in view of [its] limitations.”

But Emanuel ignored OACT’s warnings. He based his entire argument upon OACT’s 2010 guesstimate of what total spending might be in each of the years from 2010 to 2017. As it turned out, OACT’s guestimate of spending over those years exceeded actual spending by $2.3 trillion. The rational explanation for the difference is that OACT’s guesstimate was inaccurate. But Emanuel concluded the ACA cut expenditures — a fatal methodological flaw disqualifying it from scientific discussion.

Emanuel made much of the fact that OACT was the author of not only the 2010 guesstimate but of the annual reports on actual spending for the years 2010 through 2017 (these reports are the source for data in Figure 1). Not one of OACT’s annual reports after 2010 even hinted that the ACA lowered national spending. Instead, OACT reported the ACA’s impact was either negligible or inflationary.

For example, the OACT report on 2012 spending stated, “The … ACA had a minimal impact on overall national health spending growth,” and its report on 2015 spending stated the ACA was the “primary” reason why healthcare costs rose at an unusually high rate. OACT’s 2018 report does not even mention the ACA. And most economists agree with OACT’s analysis. The prestigious Leonard Davis Institute of Health Economics at the University of Pennsylvania (Emanuel’s university) found “little evidence that ACA cost containment provisions produced changes necessary to ‘bend the cost curve.'”

Emanuel’s arguments would be more credible if he had identified even one ACA policy that reduced costs. But the only ACA policy he mentioned was a program that, he writes, “required reducing … wasteful readmissions.”

This would be the Hospital Readmissions Reduction Program (HRRP), a dangerous program that should be terminated immediately. The HRRP’s proponents claimed it would cut costs and improve health by penalizing hospitals for “too many” hospital readmissions. But the evidence now indicates this program is backfiring. Well-controlled studies show the HRRP may have raised the mortality rate among heart failure and pneumonia patients by reducing necessary readmissions, and it has not cut costs.

We share Emanuel’s commitment to an efficient healthcare system with evidence-based price controls. But cheerleading from academic leaders about the false achievements of futile, and sometimes harmful, cost-containment policies has unintended consequences for health and efficiency, and it undermines our ability to build a universal, affordable healthcare system. We already have reliable methods to evaluate the successes and failures of national cost-control policies. Congress and the President must base future health policies on solid evidence of benefits without patient harms. And if we have the guts to be honest, we will acknowledge that learning from failure can be the key to future success.

Kip Sullivan, JD, is a member of the policy advisory board for Health Care for All Minnesota and the Minnesota chapter of Physicians for a National Health Program. Stephen Soumerai, ScD, is professor of population medicine, founding and former director of the Division of Health Policy and Insurance Research, and teaches research methods at Harvard Medical School.

https://www.medpagetoday.com…

Misinformation is poisoning the debate over health care

By David Ray, M.D.
Times Union (Albany, N.Y.), July 29, 2019

The creation of Medicare 54 years ago this month dramatically decreased the impoverishment of America’s senior population due to medical bankruptcy, at the same time measurably improving health care outcomes by assuring access to affordable care.

Health care eats up $3 trillion, 17.9 percent of the total expenditures in the U.S., dwarfing all the other sectors, including military spending. Of this, nearly $1 trillion is spent on administrative costs and inflated charges that add no value to our care.

As a physician, I’ve spent the majority of my 40-year career caring for marginalized and uninsured patients. Over that time, I’ve certainly witnessed the unfortunate consequences of falling through the cracks in the health care system. But recently, I entered the system myself as a patient following a serious accident, and had an opportunity to view, from the inside, the indignities and failures of patient care that are attributable to a system that answers to many masters. In short, what I experienced was in many ways a parody of health care in which I could see the invisible hand of the market in every aspect of my hospitalization. No opportunity for charging was missed (scanning my bar coded armband preceded every encounter) and no infraction of the myriad insurance rules, however irrelevant to my care, was tolerated, to make sure that no bills were contested or reimbursements reduced by one whit.

This was powerful reinforcement for my core belief that our system needs to be overhauled from top to bottom, to rein in cost, removing the many overseers (for-profit insurance companies, pharmacy benefit managers, hospital rating organizations) who drive that cost. Did I get what I needed? Mostly. Am I fortunate enough to have insurance to cover the lion’s share of what will undoubtedly be an astronomical and incomprehensible bill? Yes (by virtue of age I’m a Medicare subscriber). But did the experience confirm what I have felt to be true about our health care mess for decades? Sadly, also yes.

As health care has risen to the top of our national conversation, there has been a tsunami of misinformation propagated by the vested interests in the health care system.

Will a universal Medicare-type payment system limit our access to our doctors? No, providers will continue to see their patients in their offices as they do now, but won’t spend their time begging to be paid for their work.

Will there be rationing of health care? Research on wait times has shown that in existing single-payer systems, urgent care is not delayed at all, and elective care wait times are comparable to ours. Regarding rationing, we have devised the cruelest system possible — if you are uninsured or have huge copays and deductibles, you are likely to never get the care you need.

Does private insurance have to disappear? No, many of the high-functioning, cost-effective health care systems in other developed countries (such as Germany) permit a parallel, but very highly regulated, private insurance system. Insurers are forbidden to deny services or raise premiums without clear justification, and they are nonprofit companies.

Will the transition disrupt our economy? No, it will increase the freedom to seek a higher-paying job or start a business without fear of losing health care coverage, and make our industries more competitive in the world market.

There are many unbiased sources of information about the economics of our health care system available, such as Kaiser Health News or the website of Physicians for a National Health Program.

Improving and expanding Medicare to the entire population makes sense, and there is room for compromise and protection of individuals’ rights if we can convince our representatives that this is what we expect of them.

Dr. David Ray of Menands is the chair of the Capital District Alliance for Universal Health Care and a member of Physicians for a National Health Program.

https://www.timesunion.com…