PNHP

Kathleen Sebelius and Bill Frist digging for the Medicare Advantage gold

Kathleen Sebelius and Bill Frist digging for the Medicare Advantage gold

​The newest Medicare startup

By Sam Baker
Axios Vitals, October 24, 2017

Keep this on your radar: My colleague Bob Herman reports Devoted Health, a new insurance company that will only sell Medicare Advantage plans, just raised $62 million, according a new financial disclosure. The startup will start selling Medicare Advantage plans in 2019.

The players: Some big names are backing Devoted Health: Former HHS Secretary Kathleen Sebelius and former Senate Majority Leader Bill Frist are on the board. Todd and Ed Park, brothers who both worked at electronic health record and billing company athenahealth, are the co-founders; they also recruited Venrock’s Bob Kocher as chief medical officer.

Get smart: Medicare Advantage is where the big money is. The ACA marketplaces grab a lot of headlines, but they are a blip on the radar when compared with the hundreds of billions of dollars tied up in private Medicare plans and care for seniors.

https://www.axios.com…

Devoted Health:
https://devoted.com…

***

Comment:

By Don McCanne, M.D.

“Medicare Advantage is where the big money is,” and Former HHS Secretary Kathleen Sebelius and former Senate Majority Leader Bill Frist are going for it. Our trusted public servants have led us down the path of privatization of Medicare by way of the private, for-profit Medicare Advantage plans. Now that they have left government, the payoff awaits them.

When we could have a vastly superior publicly-financed and publicly-administered improved Medicare for all, why do we continue to tolerate this? Satisfying the greed of the few takes precedence over ensuring the health of all of us? Where are our values in all of this?

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

Bernie Sanders in Canada

Bernie Sanders compares U.S. health-care struggles to rights movements

By Theresa Boyle and Alex McKeen
thestar.com, October 29, 2017

American Senator Bernie Sanders says insurance and drug companies, and those with extreme wealth, are hurting health care in the United States and warned Canadians not to allow that to happen on this side of the border.

“It is a shame, it is a disgrace,” he said in a speech in Toronto on Sunday, explaining that 28 million Americans do not have health insurance and that the current U.S. government wants to drop public coverage for millions more to pay for tax cuts for the most wealthy.

The independent senator from Vermont received four standing ovations from a crowd of about 1,500 at the University of Toronto’s Convocation Hall as he described his crusade to reform health care in his country.

***

The following link includes a video of Bernie Sanders’ presentation plus an introduction by Ontario Premier Kathleen Wynne and an interview of him by Danielle Martin. (The video is labeled “WATCH LIVE.” Since the opening quartet did not record satisfactorily, advance to 18:00 for the start.)

https://www.thestar.com…

***

Comment:

By Don McCanne, M.D.

This video provides a pleasant break from our somber reform activities since it demonstrates the passion of the people of a nation who really care about their health care system and are so pleased to see that someone south of their border cares as well: Bernie “Tommy Douglas” Sanders.

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

The cost of regulatory overload

Regulatory Overload: Assessing the Regulatory Burden on Health Systems, Hospitals and Post-acute Care Providers

American Hospital Association, October 2017

Every day, health systems, hospitals and post-acute care (PAC) providers – such as long-term care hospitals, inpatient rehabilitation facilities, skilled nursing facilities and home health agencies – confront the daunting task of complying with a growing number of federal regulations. Federal regulation is largely intended to ensure that health care patients receive safe, high-quality care. In recent years, however, clinical staff — doctors, nurses and caregivers — find themselves devoting more time to regulatory compliance, taking them away from patient care. Some of these rules do not improve care, and all of them raise costs. Patients also are affected through less time with their caregivers, unnecessary hurdles to receiving care and a growing regulatory morass that fuels higher health care costs.

This report assesses the administrative impact that existing federal regulations from just four agencies – CMS, OIG, OCR and ONC – have on health systems, hospitals and post-acute care providers across nine domains:

1. Quality reporting;

2. New models of care/value-based payment models;

3. Meaningful use of electronic health records;

4. Hospital conditions of participation (CoPs);

5. Program integrity;

6. Fraud and abuse;

7. Privacy and security;

8. Post-acute care; and

9. Billing and coverage verification requirements.

Major Findings

1. Health systems, hospitals and PAC providers must comply with 629 discrete regulatory requirements across nine domains.

2. Health systems, hospitals and PAC providers spend nearly $39 billion a year solely on the administrative activities related to regulatory compliance in these nine domains.

3. An average size hospital dedicates 59 FTEs (full-time equivalents) to regulatory compliance, over one-quarter of which are doctors and nurses.

4. The timing and pace of regulatory change make compliance challenging.

5. Among the nine areas investigated, providers dedicate the largest proportion of resources to documenting CoP (conditions of participation) adherence and billing/coverage verification processes.

6. Meaningful use has spurred provider investment in IT (information technology) systems, but exorbitant costs and ongoing interoperability issues remain.

7. Quality reporting requirements are often duplicative and have inefficient reporting processes, particularly for providers participating in value-based purchasing models.

8. Fraud and abuse laws are outdated and have not evolved to support new models of care.

General Opportunities to Reduce Burden

A reduction in administrative burden will enable providers to focus on patients, not paperwork, and reinvest resources in improving care, improving health and reducing costs. Given these findings, we have several general recommendations to reduce administrative requirements without compromising patient outcomes, both overall and within each domain.

• Regulatory requirements should be better aligned and consistently applied within and across federal agencies and programs, and subject to routine review for effectiveness to ensure the benefits for the public good outweigh additional compliance burden;

• Regulators should provide clear, concise guidance and reasonable timelines for the implementation of new rules;

• CoPs should be evidence-based, aligned with other laws and industry standards, and flexible in order to support different patient populations and communities;

• Federal agencies should accelerate the transition to automation of administrative transactions, such as prior authorization;

• Meaningful use requirements should be streamlined and should increasingly focus on interoperability, without holding providers responsible for the actions of others;

• Quality reporting requirements should be thoroughly evaluated across all programs to better determine what measures provide meaningful and actionable information for patients, providers and regulators;

• PAC rules should be reviewed and simplified to remove or update antiquated, redundant and unnecessary rules; and

• With new delivery system and payment reforms emerging, Congress, CMS and the OIG should revisit the Stark Law and AKS and their respective regulations, as well as other requirements aimed at combating fraud, and make meaningful changes to ensure that statutes provide the flexibility necessary to support the provision of quality, high-value care.

From the Conclusion

Health systems, hospitals and PAC providers are besieged by federal regulatory requirements promulgated by CMS, OIG, OCR and ONC, many of which are duplicative and cumbersome and do not improve patient care. In addition to the regulatory burden put forth by those agencies, health systems, hospitals and PAC providers are subject to regulation by additional federal agencies, such as the Department of Labor, the Drug Enforcement Administration, the Food and Drug Administration and by state licensing and regulatory agencies. They also operate under stringent contract requirements imposed by payers, such as Medicare Advantage, Medicaid Managed Care plans and commercial payers, which also require reporting data in different ways through different systems. States and payers contribute to burden through, for example, documentation, quality reporting and billing procedures layered on top of the federal requirements.

Regulatory reform aimed at reducing administrative burden must not approach the regulatory environment in a vacuum — evaluating the impact of a single regulation or requirements of a single program — but instead must look at the larger picture of the regulatory framework and identify where requirements can be streamlined or eliminated to release resources to be allocated to patient care.

http://www.aha.org…

***

Comment:

By Don McCanne, M.D.

A quick look at the nine domains of regulatory overload is all you need to be reminded of the nightmare created by these evolving requirements. Inefficiencies, wasted resources, and provider burnout ensue, which negatively impact the primary mission of the health care system: patient care.

It is estimated that health systems, hospitals, and post-acute care providers spend about $39 billion per year on administrative activities related to compliance in these domains. This report provides suggestions for reducing this regulatory overload, though only a portion of the costs would be recovered since appropriate regulatory oversight is still essential.

For perspective, think of the recoverable administrative waste that characterizes our fragmented health care financing system – most of it in the private sector. We spend over a trillion dollars a year on administration, and somewhere around $300 billion to $500 billion is recoverable merely by transitioning to a well designed single payer system. Thus the total spending attributed to regulatory overload is, at most, only a tenth of what could be recovered.

The opportunities listed to reduce the burden of regulatory overload should be considered but with the realization that they are limited by the constraints of our current dysfunctional health care financing system. What needs to be done first is to correct the fundamental flaw in our health care financing infrastructure by enacting and implementing a single payer system, and then the list can be surveyed to fine tune any residual regulatory burdens.

We desperately need reform, but let’s get it right.

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

James Morone explains rationale of ‘Medicare for All’

How to Think about “Medicare for All”

By James A. Morone, Ph.D.
The New England Journal of Medicine, October 25, 2017

In April 1946, President Harry Truman introduced a single-payer health plan and met the same reaction that would greet Senator Bernie Sanders (I-VT) and his colleagues when they proposed “Medicare for All” in September 2017. “It is believed by competent Congressional observers to have little chance of approval,” reported the New York Times back in 1949. Newsweek was blunter: “No chance at all.” Neither Truman nor Sanders even bothered to include financing for their plans. Truman had no more success with a scaled-back proposal to cover only people over 65 years of age, but 13 years later President Lyndon Johnson signed the Truman revision into law as Medicare, declaring that the United States was finally harvesting “the seeds of compassion and duty” that his predecessor had sown. A proposal with no chance in one era had become law in another. Medicare proved so popular that it came to be a third rail of American politics — dangerous to touch. What lessons does Truman’s success hold for today’s “no chance” Medicare for All?

The usual metrics for evaluating policy proposals — vote counts, Congressional Budget Office scores, and tax calculations — are misleading because Medicare for All is an idea for the long run. For a more accurate assessment of its prospects, keep an eye on four key questions.

Is there a right to health care? The Affordable Care Act and the efforts to repeal and replace it raised fundamental ethical questions about whether Americans have a right to health care and, if so, whether government should secure it. The Medicare-for-all proposal responds with a strong claim for a right to roughly equal health care coverage for everyone. The American patchwork — superb health insurance for some; no health insurance for 30 million others; and shaky high-deductible, high-premium plans on the individual market and in many workplaces — is not just poor policy. It is wrong. It violates the norms of communal decency. Late-night talk-show host Jimmy Kimmel distilled this view when he tearfully responded to the House repeal-and-replace plan: “No parent should ever have to decide if they can afford to save their child’s life. It just shouldn’t happen. Not here.”

Medicare for All is, first and foremost, an exercise in moral persuasion. It will become a serious policy proposal if it creates a major surge in public opinion. That’s how “no chance” reforms win in the United States, whether it’s the passage of Medicare or the right of same-sex couples to marry. On this measure, Sanders is making progress. Last time he proposed his plan, he stood alone; this time, 16 Democrats crowded beside him — including some leading contenders for the next presidential nomination. The difference sprang from the 12,029,699 votes Sanders racked up in the Democratic presidential primaries. To handicap the future prospects of the plan, watch what happens as candidates take it to the voters.

Won’t the cost savings eventually convince skeptics? International comparisons reveal that other wealthy countries cover most of their populations with much lower spending. Although every country is unique, no other nation supports the sprawling administrative, insurance, and billing bureaucracies that reach into every U.S. clinic and practice; moreover, single-payer systems offer budgetary levers that our own fragmented nonsystem does not have. The results are striking. For example, Canadian health costs were indistinguishable from those in the United States until Canada finished introducing its national health insurance program in 1971; then, health care’s share of the Canadian economy flattened out dramatically. By 2014, according to the World Health Organization, Canada spent 10.4% of its gross domestic product on health care, as compared with the 17.1% we spent in the United States. Closer to home, our own single-payer plan, Medicare, appears to constrain rising costs more tightly than private insurers do.

The data tempt advocates to push Medicare for All as an efficiency fix for U.S. health care. However, mere efficiency arguments are unlikely to propel a change this big through the multiple checks and balances of U.S. politics. In politics, good data are not enough. They are a necessary but not sufficient condition for winning major legislation. Proponents will first have to create a movement.

Still, the efficiency claim always lingers in the middle distance: like Charles Dickens’s ghost of Christmas yet-to-come, single-payer plans challenge us to change our ways. If more conventional approaches fail to control costs and offer Americans more reliable access to health care, Medicare for All will continue to beckon as the fairer, less expensive, cross-nationally tested alternative.

But what about the taxes? Skeptics emphasize the new taxes that Medicare for All would require. In a white paper accompanying his proposal, Sanders fills in some vertiginous details: raise marginal income tax rates to 40% on incomes from $250,000 to $500,000; raise rates to 52% for incomes above $10 million; and tax capital gains and dividends like income from work. Do those kinds of increases doom Medicare for All? Perhaps just the reverse, for this is one of the few policies that directly confronts American inequality.

No other country has experienced a rise in inequality as steep or as high as the one we’ve seen in the United States. In 1970, standard inequality measures pegged the United States at roughly the same level as France and Japan; almost 50 years later, U.S. inequality levels are closer to those of Mexico and Brazil than to those in Northern Europe. Today, the top 1% of households control 38.6% of the country’s wealth, far more than the bottom 90% (which controls just 22.8%). The median white family (in the exact midpoint of the income distribution) is 10 times as wealthy as the median black family. Intergenerational economic mobility has stagnated. Political scientists generally believe that rising inequality and slowing mobility have a destabilizing effect — and they may be driving the angry populism that is now stirring on both the left and right ends of the political spectrum.

Medicare for All offers politicians a way to squarely address the issue. It would lift a substantial financial burden from low- and middle-income families — their health insurance premiums — and shift the weight to wealthier Americans by raising their taxes. In reversing inequality, taxes are not a bug but a populist feature. Disruptive populism ended past American gilded ages, and it shows signs of challenging the current one. If so, Medicare for All is on a short list of available policies designed to push back on inequality.

Isn’t Medicare for All politically implausible in antigovernment America? It is easy to forget how dramatically U.S. politics changes from era to era. New issues rise onto the agenda, different national values grow more (or less) important, underlying political assumptions evolve, and an entirely new coalition grows influential. What seems impossible in one generation is taken for granted in another. The kind of turbulence we are experiencing in contemporary party politics often signals precisely this sort of sea change. One necessary condition for a breakthrough change is already in place: a righteous band of reformers, deeply committed to a cause, pushing against all odds.

Medicare for All fits awkwardly into the Washington conversation because it is more than a health policy prescription. It aims to foster changes on three different levels of analysis. It is a policy proposal designed to improve health care delivery, an ambitious claim about equality and social justice, and an effort to usher in a more progressive era in American politics. Each is a long shot, but Medicare for All and its advocates stand in a venerable reform tradition that has rewritten U.S. politics many times in the past. It would be a mistake to dismiss them now.

James A. Morone, Ph.D. is the John Hazen White Professor of Public Policy and Professor of Political Science and Urban Studies, Brown University

http://www.nejm.org…

***

Comment:

By Don McCanne, M.D.

Read the article and then share it with others.

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

American Doctors Join Sen. Bernie Sanders for Canadian Health Care Tour

Physicians want to learn how Canada provides universal coverage while spending half of what the U.S. does on health care

FOR IMMEDIATE RELEASE, October 26, 2017
Contact: Clare Fauke, communications specialist, 312-782-6006, clare@pnhp.org

This weekend, American physicians Claudia Fegan, M.D., and Richard Bruno, M.D., M.P.H, will join Sen. Bernie Sanders on a fact-finding delegation to Toronto, Canada. On Saturday, the delegation will tour three Canadian hospitals and speak with Canadian health care providers and patients. On Sunday, they will join Dr. Danielle Martin at the University of Toronto for a public event.

By exploring the Canadian system, the doctors hope to learn how a single-payer health system contributes to quality, access, equity, and cost efficiency. Canada spends $4,569 per capita (10% of GDP) on health care, while the U.S. spends $9,086 per capita (17% of GDP). Despite drastically lower health care spending, Canada provides its citizens with universal coverage. Canada also enjoys lower infant mortality and lower rates of deaths that could have been prevented with timely and effective health care.

“As a doctor who cares for uninsured patients, I’m especially curious to see how Canadians get their health care,” said Dr. Richard Bruno, a family physician based in Baltimore, Md. “The data suggests that Canadians enjoy better benefits and health outcomes for less money. How do they do it and how can we do it even better?”

Dr. Claudia Fegan, a Chicago-based internist and chief medical officer for the Cook County Health and Hospital System and John H. Stroger Jr. Hospital of Cook County, wants to learn how doctors practice medicine without having to deal with a fractured, profit-based health care system. “A majority of American doctors now support a single-payer health program,” says Dr. Fegan. “We can look to the experience of other nations to figure out how to get there.” She notes that 54% of American doctors say that time spent on administrative issues related to insurance or claims is a major problem, versus 20% of Canadian doctors.

Drs. Bruno and Fegan are both board members of Physicians for a National Health Program, a nonprofit research and educational organization of more than 21,000 doctors and health professionals who support a single-payer national health program.

Richard Bruno, M.D., M.P.H. is a family physician at an underserved clinic in Baltimore, Maryland. His clinical focuses are on obesity and opioids, with involvement in community public health interventions and policies. He attained a bachelor’s degree from Princeton University, doctorate of medicine from Oregon Health and Science University, and a master of public health from the Johns Hopkins Bloomberg School of Public Health.

Claudia Fegan, M.D., CHCQM is national coordinator of Physicians for a National Health Program and chief medical officer for the Cook County Health and Hospital System and John H. Stroger Jr. Hospital of Cook County. She is also president of the Chicago-based Health and Medicine Policy Research Group. She is a co-author of the book “Universal Healthcare: What the United States Can Learn from the Canadian Experience” and a contributor to “10 Excellent Reasons for National Health Care.” Dr. Fegan received her undergraduate degree from Fisk University and her medical degree from the University of Illinois College of Medicine. She is also certified in health care quality and management and is a diplomate of the American Board of Quality Assurance and Utilization Review Physicians.

California’s Select Committee Hearing on Health Reform

Informational Hearing: Health Care Delivery Systems in California and Other Countries

California Legislature, October 23-24, 2017

Joaquin Arambula, Chair: One of the things that is quite striking and sad is that we lose our health care here in America when you lose your job. It seems like that’s the last time that you would want to be losing your health care coverage. And so I’m wondering how do other countries… Is it just that commitment that health care is a human right? Is it the belief that we are in this in solidarity? To be equitable partners as members of the same community, and how best can we help those who through no fault of their own may have lost their employment and now can’t afford the care that they will require?

Robin Osborn, Vice President and Director, International Program in Health Policy and Practice innovations, The Commonwealth Fund: So, I think that you used the word that comes up very frequently in talking to people from these other health care systems, and solidarity is it. I mean there is a strong sense of an entitlement as a basic human right to health care. So that’s not… There isn’t a debate about that in these countries. And even where there is a difference in political parties around a vision for the health care system, it is not as dramatic… and maybe polarizes you like we see here in the United States. There basically is a general acceptance of “this is our health care system.” And maybe there are reforms about how doctors will be paid or maybe reforms about how primary care practices will be organized, but there is usually sort of a broad commitment and level of support for having the health care system that they have. So I think it’s a different starting place from maybe where we are now.

Assembly Select Committee Informational Hearing: Health Care Delivery Systems in California and Other Countries

October 23, 2017: California’s Current System and Current Gaps in Coverage
October 24, 2017: Universal Coverage Systems in Other Countries

For links to agenda and archived videos:
http://www.calchannel.com…

***

Comment:

By Don McCanne, M.D.

This Select Committee of the California State Assembly was formed to take a comprehensive look at health care reform options in response to a decision to hold in committee the single payer bill that had already passed in the State Senate, SB 562 – The Healthy California Act.

On the second day of the first hearing, testimony was presented by Robin Osborn and Sara Collins of The Commonwealth Fund demonstrating that other wealthy nations are much more effective than we are in ensuring health care access and affordability for everyone. How do they do it? As Robin Osborn explains, it’s through solidarity. Other nations do not even have to think about that. It is a given.

Can we have that here? Maybe if we cut out all the political noise and start talking to each other.

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

A Business Owner Says Single Payer is the Answer to the Nation’s Health Insurance Crisis

Interview with Richard Master

By Rob Lorei
Radioactivity, WMNF (Tampa, Fla.), October 25, 2017

A documentary film called FIX IT: Health Care At The Tipping Point came out last year. It makes the case for American business leaders to support health care reform that would include establishing a single payer health insurance system in the U.S.

The film was two years in the making, with more than 40 voices advocating for reform, including: activists, health policy experts, economists, physicians, nurses, patients, and business and labor leaders.

FIX IT takes an in-depth look into how our complex health care system is damaging our economy, suffocating our businesses, discouraging physicians, and negatively impacting the nation’s health, while remaining un-affordable for a third of our citizens.

full audio:
https://sound.wmnf.org…

view the film:
https://fixithealthcare.com…

We are America’s future doctors. We support a Medicare-for-all health system.

By Augie Lindmark, Vanessa Van Doren, Bryant Shuey, and Andy Hyatt
STAT, October 25, 2017

Underneath a heap of hospital blankets, Stephen seemed small for a 7-year-old. His chest rose and fell rapidly, a frightening rhythm given his history of asthma. His parents stood nearby as veteran witnesses — Stephen had been admitted to a Cleveland safety net hospital for asthma four times already this year — but familiarity offers little comfort when your child struggles to breathe. When asked if their son used his asthma inhalers, they replied, “It depends. When we can afford them, he takes them. But when we can’t, it could be a few weeks.”

Stephen represents one of more than 430,000 hospitalizations each year due to asthma. At a cost of $56 billion annually, complications from asthma can be prevented with regular medications (inhalers), avoidance of triggers like dust and mold, and access to health care, which usually means access to health insurance. Stephen didn’t have the latter.

Of the diseases we are taught in medical school, a sudden worsening of asthma, known as an exacerbation, is a relatively common cause of illness in children and adults. To identify the cause of a disease, doctors are trained in the differential diagnosis. This bedrock of medical education encourages doctors — those in training, like us, as well as those with years of experience — to compile a list of causes that match a patient’s symptoms. In a way, the differential is half medicine, half Sherlock Holmes.

Chest pain, for example, might include differential diagnoses that range from heart attack to having eaten too many buffalo wings. Yet there’s a particular cause of illness — in Stephen’s case, a nonpulmonary culprit — that is unique to American health care: America’s private health insurance system.

Recent months provide ample context. As the latest Obamacare repeal efforts took the form of Graham-Cassidy 1.0 and 2.0, the GOP bill would have kicked 32 million Americans off their health insurance. Patients with preexisting conditions like asthma would have seen sharp increases in their health insurance premiums (in the case of metastatic cancer, to the tune of six digits), and Medicaid reimbursements to Planned Parenthood would have been banned, effectively barring millions of women from reproductive and preventive health care.

Both Republican and Democratic efforts have done little to change the fact that thousands of Americans die from lack of health coverage. America’s fragmented and inequitable health system is a sinking ship and recent fixes — often in the form of private health insurance industry bailouts or shutouts — are like placing tissue paper over the leaks in this doomed vessel.

No bacteria or viruses harm health more than policies that effectively prevent millions of individuals from access to affordable health insurance to pay for life-altering health care, including the recent ill-conceived executive order. As American health care maintains its appalling position as a leading cause of financial burden and bankruptcy, an equitable response is essential. That means creating a system in which access to health care is based on need, not the ability to pay. As future doctors, we are being trained to identify root causes of disease. That’s why we support Medicare for all.

Momentum toward an improved and expanded Medicare for all health system is at historic highs. The majority of American physicians now support single-payer health care, and 60 percent of Americans believe that the federal government has a responsibility to ensure health care for all citizens.

Last month, the Medicare for All Act was rolled out with fanfare as Sen. Bernie Sanders — joined by 16 co-sponsors — offered a blueprint for universal health care in America. Its sister bill in the House of Representatives, the Expanded and Improved Medicare For All Act, has 120 Democratic co-sponsors, making it the first single-payer bill in history to have a majority of Democratic support.

The overwhelmingly popular Medicare and Medicaid programs have saved millions of lives and offer strong, supportive health care to millions of Americans. Why not offer that to all Americans? As the life expectancy gap between rich and poor increases, the only path forward is to ensure that all Americans have affordable health care, regardless of socioeconomic background.

President Trump recently declared his desire to “stabilize markets” which, historically, has meant diverting funds to private insurers who have done an outstanding job of shrinking coverage and fattening corporate profits. Trump’s latest executive order, which eliminates select private insurance subsidies, will ironically dampen private profits at the expense of escalating premiums for the middle class.

Private insurance subsidies are Band-Aids on an already oozing wound, an inefficient private industry that prioritizes the depth of shareholder pockets over patient health. And while subsidies are short-term fixes inadequate for a long-term solution, removing them altogether, as has been the procedure in the latest GOP bills, would further limit patient access to affordable, comprehensive care. This worse-worst situation could be healed with an improved Medicare-for-all system that eliminates profit motives and preferentially places health above all else.

As medical students, we occupy a unique seat from which to view America’s health system. Our inexperience means we haven’t been indoctrinated into the damaging practices of the private health insurance industry. Our optimism tells us that the system can be changed. We entered medicine out of a desire to help people. But if we participate in a flawed health care system without advocating for structural and equitable change, we trend toward hypocrisy rather than Hippocrates.

Because Stephen’s parents couldn’t afford asthma medications, their son’s breaths were figuratively assigned a price tag. His family, like millions of Americans, is forced to make an impossible decision: pay for food and rent, or purchase medications and health insurance. Recent months have seen patients, students, and health professionals realize this crisis and mobilize toward a better alternative: Medicare for all. We advocate to practice in such a system, where every patient has health care. And where every patient can breathe freely.

Augie Lindmark, Vanessa Van Doren, Bryant Shuey, and Andy Hyatt are medical students the University of Minnesota, Case Western Reserve University, University of New Mexico, and Boston University, respectively, as well as board members of Physicians for a National Health Program, an organization that advocates for an improved and expanded Medicare for All health system.

https://www.statnews.com…

Health insurance competition continues to shrink

AMA study says competition among health insurers is shrinking

By Shelby Livingston
Modern Healthcare, October 23, 2017

A single health insurance company dominates the commercial insurance market in more than 4 in 10 of the nation’s metropolitan areas, according to an analysis by the American Medical Association.

The study released Monday showed that competition among health insurers continues to shrink, despite several proposed mergers falling through earlier this year, including deals between Aetna and Humana, and Anthem and Cigna. Previous studies have shown that consolidation among insurers leads to lower payments for doctors and higher premiums for patients.

In 2016, a single insurer captured at least half of the commercial insurance market share in 43% of the 389 metro areas analyzed, according to the AMA. That’s up from 40% of metro areas in 2014. The AMA also said 89% of metro areas had at least one insurer with a commercial market share of 30% or more.

The findings are part of the AMA’s annual review of insurance market competition. It found that nearly 7 out of 10 commercial markets have a significant lack of competition, with 9 in 10 of the health insurance exchange markets lacking competition.

http://www.modernhealthcare.com…

AMA release:
https://wire.ama-assn.org…

***

Comment:

By Don McCanne, M.D.

Although we have by far the world’s highest health care costs we continue to rely on competition between private health insurers to bring costs down. But the AMA shows us once again that private health insurance markets are not competitive while per capita costs remain twice the average of other wealthy nations. So do we continue on the same path simply wishing that someday it would work?

We pay the private insurers a huge amount for their administrative services while tolerating the costly administrative burden that they place on the health care professionals and institutions. Since this hasn’t brought us lower costs through competition, then what are we actually purchasing with these extra payments? Plans with high deductibles and other cost sharing that erect financial barriers to care? Plans with narrow networks that take away choices of physicians and hospitals? Plans that manipulate markets to avoid more costly patients with greater needs? These are negatives, and we are paying extra for them?

The insurers need us, but we certainly don’t need them. It’s time to extricate ourselves from the capture by this industry. Let’s replace them with our own system – an improved Medicare for all – designed to help us get the health care we need, at costs that are reasonable.

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

A net of 3.5 million Americans have lost their insurance this year

U.S. Uninsured Rate Rises to 12.3% in Third Quarter

By Zac Auter
Gallup News, October 20, 2017

The percentage of U.S. adults lacking health insurance rose in the third quarter of 2017 to 12.3%, up 0.6 percentage points from the previous quarter and 1.4 points since the end of 2016.

The uninsured rate, measured by Gallup and Sharecare since 2008, had fallen to a record low of 10.9% in the third and fourth quarters of 2016. However, the 1.4-point increase in the percentage of adults without health insurance since the end of last year represents nearly 3.5 million Americans who have entered the ranks of the uninsured.

Several marketplace factors could be contributing to the growth of the uninsured rate since 2016. Some insurance companies have stopped offering insurance through the exchanges, and the lack of competition could be driving up the cost of plans for consumers. As a result, the rising insurance premiums could be compelling some Americans to forgo insurance, especially those who fail to qualify for federal subsidies.

Uncertainty about the healthcare law also may be driving the increase. Congressional Republicans’ attempts to replace the healthcare law may be causing consumers to question whether the government will enforce the penalty for not having insurance.

The uninsured rate has increased at least one point among all key demographic subgroups since late 2016, except for those aged 65 and older. The growth has been concentrated mostly among middle-aged Americans, racial minorities and lower-income Americans.

http://news.gallup.com…
***

Comment:

By Don McCanne, M.D.

The uninsured rate of U.S. adults, at the end of last year, was 10.9%. Since then it has increased to 12.3%, representing a net of nearly 3.5 million Americans who have entered the ranks of the uninsured. This increase in the numbers of uninsured, in spite of the Affordable Care Act, provides us with two important lessons.

The politicians that we elect play a very important role. Americans have chosen leaders who believe that reducing government spending is more important than ensuring health care for all. Thus we have seen a targeted effort both in Congress and especially in the Trump administration to reduce government subsidies of health care. If you don’t mind seeing more Americans, especially racial minorities and those with low incomes, going without affordable access to health care, then keep electing the same politicians. Those who do care (the majority) need to become more involved in political activism.

The other even more important lesson is that the infrastructure of the financing system is absolutely crucial. Right now we have a highly fragmented system which allows manipulation to favor both the vested interests and the political ideologues. This study showed that the only group that did not have at least a one point increase in the uninsured was those aged 65 and older – Medicare!

Medicare is a highly stable social insurance program that belongs to everyone as an entitlement. It is ours; we earned it. The politicians currently in control are telling us once again that Medicare is going broke, and we have to do something about that, but fortunately over the last half century the program has remained resistant to their attacks. Their agenda this year includes premium support (vouchers) which would be very damaging to the program since they chisel away government support. But as long as Americans keep defending Medicare, it should always be there for us.

The obvious conclusion is that we should improve Medicare so it works better, and then expand it to include everyone. Contrast that to the expansion program we are supporting today – ACA – as we watch 3.5 million Americans lose their coverage!

When the politicians in public forums answer questions about single payer by telling us that single payer may be in the future but for now now we have to keep supporting ACA, remind them that their response to the decline in coverage is to add copper plans that pay only half of average medical costs (bipartisan Alexander-Murray legislation), just so they can say more people are insured – though that is a sure path to a skyrocketing rate of medical bankruptcies. Copper plans should fit well with our outrageous deductibles, with our empty health savings accounts, with our loss of choice through narrow provider networks, and with our unaffordable premiums that support such egregiously excessive administrative costs. They want more of that?!

It seems that boos and catcalls have lost their impact. Maybe it’s time to revitalize the Bronx cheer. Yes, that’s rude, but what could be more rude than them telling us that we should be thankful that they are going to try to get us copper plans.

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

Is lowering Medicare eligibility to age 55 a wise incremental step?

A New Plan To Rescue The ACA: Medicare-At-55

By Thomas Bodenheimer
Health Affairs Blog, October 16, 2017

On October 12, 2017, the Trump Administration announced that it would end subsidies that reduce out-of-pocket payments for low-income individuals. This action might drive insurers out of the exchanges and might encourage younger people to drop their individual insurance plans — thereby destabilizing the individual insurance market.

Extending Medicare to the 55-64 age group—who have relatively high health care costs—is a potential fix that could insure the near-elderly and provide stability to the marketplaces. It would remove expensive individuals and families from coverage by private insurance companies, who could in turn reduce premiums for individuals and families below the age of 55.

Under this proposal, Medicare-at-55 would be universal for people in the 55-64 age group and they would leave their current private insurance. It would require an increase in the Medicare payroll tax contribution which has not increased proportionately to increases in Medicare spending; other countries sustain their health insurance programs by gradually increasing their payroll tax contributions. To make this plan fiscally sustainable, the United States would need to do the same.

The Problem With Making Medicare-At-55 Optional

Medicare-at-55 is quite different from proposals suggested by Democrats in 2009 and 2017, which allowed people aged 55-64 to voluntarily buy into Medicare as an alternative to private insurance. The problem with the idea of Medicare buy-in is that relatively few of the near-elderly would choose it. Medicare premiums for this age group—about $8,200 per year for an individual—would be significantly higher than what they currently pay with employer-sponsored insurance and with individual insurance subsidized under the Affordable Care Act (ACA).

In addition, under an optional buy-in there would be confusion among potential enrollees on whether to use the buy-in and person-by-person enrollment would be administratively complex. Moreover, the buy-in would raise vexing legislative questions around premium levels, Medigap and Medicare Advantage policies, and whether people could buy-in to Parts A, B, and D separately.

Automatic Enrollment, Just Ten Years Earlier

 The better approach would be to implement a Medicare-at-55 concept in which everyone would be automatically enrolled in Medicare — just like the current system does for those 65 and above. Upon reaching the age of 55, eligible individuals (almost everyone in the 55-64 age group) would simply receive their red-white-and-blue Medicare card. Private insurers and employers would no longer be responsible for this age group, which would allow private insurers to reduce premiums on younger families because they would have a younger, and typically healthier, pool of people to cover. In 2015, per capita health care costs for people between 55 and 64 years of age were $9,707 compared with $6,637 for the 45-54 age group, $4,442 for the 26-44 cohort, and $2,915 for those between 19 and 25.

Once on Medicare at the age of 55, people could choose to get a Medicare supplement through their previous insurer or join a Medicare Advantage plan. While the 55-64 age group has higher health care costs than younger people, they have lower costs than current Medicare beneficiaries, which in 2015 incurred per capita spending of $11,904.

Keep in mind that this is not small group to be adding to Medicare’s risk pool. In 2015, there were 41.1 million people in the 55-64 age group. 24 million have access to employer-sponsored insurance, 3 million have subsidized individual insurance under the ACA, 2 million purchase unsubsidized individual insurance, and 3.4 million are uninsured. This leaves an estimated 8 to 9 million already on Medicare and/or Medicaid.

How Would We Pay For Medicare-At-55?

First, it is noteworthy that from 2010 to 2016, per capita Medicare spending growth was 1.3% compared with 3.5% for private insurance. Second, it would be impossible for most people in the 55-64 age group to pay for their Medicare plan and—given the high per capita costs of this age group—it would be very expensive for the federal government to subsidize their plan. The costs of Medicare-at-55 would have to be borne by the younger population, who would benefit greatly as they reached 55.

The best revenue source for Medicare-at-55 is the current Medicare financing model: payroll tax for Medicare Part A, individual premiums and general federal revenues for Medicare Part B, and Part D through general federal revenues and out-of-pocket costs. The same model could be extended to the 55-64 age group, with an increase in the payroll tax, for example, from 2.9% (half from employers and half from employees) to 3.9% and an increase in the higher-income payroll tax from 2.35% to 3.35%. The precise increases would have to be calculated by federal actuaries and these increases could also be used to extend Medicare’s life from the current date of 2029.

To add to these Medicare revenues, which are distributed throughout the entire population, the new 55-64 beneficiaries would still pay their Part B premiums ($134 per month for incomes of $85,000 or less, more for higher incomes) and Part D (prescription drugs) premiums. Their out-of-pocket costs would depend on whether they have a Medicare supplement or Medicare Advantage plan. The 55-64 population would be subject to the same Medicare rules as the over 65 Medicare population.

To pay for the 55-64 age group to be folded into Medicare, not only the payroll tax, but the portion of Medicare financing provided by general federal revenues, needs to increase. Employers that insure their employees would be required to contribute through Medicare-earmarked payments. Otherwise these employers would receive a windfall since they would no longer be responsible for the health care costs of their 55-64 year-old employees.

Medicare-at-55 is a reasonable proposal to stabilize the ACA while providing reliable health insurance for the 55-64 age group. As the most expensive group insured through the ACA marketplaces moves to Medicare, insurers could reduce premiums for the remaining younger and healthier age groups. The transfer of the 55-64 cohort from employer-sponsored insurance to Medicare would allow insurers to also moderate their premiums in the employer market.

Many questions have yet to be answered in developing the concept of Medicare-at-55, but the idea deserves to be added to the mix of proposals designed to extend our nation’s insurance coverage and repair the ACA marketplaces.

Copyright ©2017 Health Affairs by Project HOPE – The People-to-People Health Foundation, Inc.

http://healthaffairs.org/blog…

***

Comment:

By Don McCanne, M.D.

Most individuals who are serious about health care reform recognize that the improvements brought to us through the Affordable Care Act have been insufficient in that costs have not been adequately contained while far too many people remain uninsured or underinsured with detrimental consequences to their health and financial well being. Further reform is mandatory.

Yet sincere reform advocates remain divided with some supporting incremental measures that would gradually repair some of the flaws in our system while others support transformation, in one step, to a universal, comprehensive program that addresses essentially all of the major defects in health care financing today. That step would be the enactment of a single payer system – an improved Medicare for all.

The divide between these two groups is not always that clear. Of those who support incremental steps some would merely tinker with the current system while supporting relatively ineffectual concepts such as value-based financing or consumer empowerment. Other incremental supporters recognize that changes should represent significant steps forward that would eventually result in a truly universal system.

Thomas Bodenheimer describes a true step forward – that of lowering Medicare eligibility to age 55. He contrasts that with the recommendation of others to allow individuals to purchase Medicare coverage. He explains some of the flaws of the Medicare buy-in, and there are others such as disruption of risk pools. Other than the fact that we do not arrive at single payer as fast, are there any other problems with this first step in moving more people into Medicare by reducing the eligibility age? Well, yes.

The traditional Medicare program is inadequate in its coverage. The cost sharing, especially coinsurance, places too great of a financial burden on retirees with modest resources, especially since there is no cap on the out-of-pocket costs. Most Medicare beneficiaries have additional coverage through Medigap, Medicare Advantage, employment retiree programs or Medicaid. Before Medicare is expanded to include those over 55, the program should be improved so that it prevents financial hardship for all beneficiaries. Also the benefits need to be expanded so that the coverage is more comprehensive. Expanding the population covered without improving the program would make it even more difficult later on to address the problems of excessive cost sharing and inadequate benefits. These defects would tend to be locked in.

Also leaving Medigap, Medicare Advantage and retiree plans as supplemental options would perpetuate the fragmentation and administrative excesses of our system, not to mention the perpetuation of inequities, especially for those who cannot afford or are not eligible for such coverage.The supplemental benefits of these plans need to be rolled into the traditional Medicare program.

Of course, that would make the expansion more expensive. The additional taxes required would likely meet with greater resistance, which is a problem anyway. But it seems more logical to face this tax issue with a single expansion to include everyone rather than fighting it over and over again with each incremental expansion.

Medicare at 55 does address the problem of covering this age group, but there is a downside to doing this as an incremental step. With other programs covering the elderly, children, pregnancy, the disabled, the poor, and the invincibles, there would be less pressure for comprehensive reform since many of the incrementalists would decide that we’ve done about all we can. They would, of course, continue to ignore the other important features of a well designed single payer system that would bring us greater administrative efficiency, equity, access, improved resource allocation, and, yes, true universality. Just try to superimpose those features on a system that the incrementalists say that we’ve already fixed.

So is lowering Medicare eligibility to age 55 a wise incremental step? As incremental steps go, it might be wise, but trying to get to an improved Medicare for all though incremental steps is clearly not wise, for the reasons mentioned. We likely would never make it to the altruistic program we envision. As Quentin Young said, we don’t want to cross that chasm in two steps.

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

Copper plans are an unacceptable trade-off

Here's the Alexander-Murray bill

By Caitlin Owens
Axios, October 17, 2017

S.___  A bill to stabilize individual market premiums for the 2018 and 2019 plan years and provide meaningful State flexibility. (The Murray-Alexander Bill)

Sec. 4 Allowing all individuals purchasing health insurance in the individual market the option to purchase a lower premium copper plan.

https://www.axios.com…

***

ACA Catastrophic Plans

HealthCare.gov

Catastrophic health insurance plans have low monthly premiums and very high deductibles. They may be an affordable way to protect yourself from worst-case scenarios, like getting seriously sick or injured. But you pay most routine medical expenses yourself.

Deductibles — the amount you have to pay yourself for most services before the plan starts to pay anything — are very high. For 2017, the deductible for all Catastrophic plans is $7,150.

https://www.healthcare.gov…

***

Comment:

By Don McCanne, M.D.

Government means-tested cost sharing reductions (CSR) were designed to reduce out-of-pocket expenses for low-income individuals in order to make health care access more affordable. President Trump terminated the CSR payments. This can result in disruptions in the ACA exchange plans.

Sen. Lamar Alexander and Sen. Patty Murray have proposed legislation in which Sen. Alexander will agree to a two year extension of the CSR payments in exchange for concessions from Sen. Murray.

One of those concessions is to allow anyone to purchase on the exchange the catastrophic plans that are currently available only to individuals under 30 or those who qualify for certain hardship exemptions. These plans are sometimes referred to as copper plans, indicating that they have an actuarial value below the other metal tier plans (bronze, silver, gold, and platinum).

The appeal of these plans is that their premiums are very low, but that is because their actuarial value is only 50 percent – they cover an average of about half of health care costs. For 2017, the deductible for these plans is $7,150.

Yesterday’s message on the deteriorating financial protection offered by today’s health plans, especially those with larger deductibles, demonstrates that this trend has produced severe adverse consequences for both the physical health and financial well being of the insured. Because of the spartan nature of the copper catastrophic plans, the adverse consequences can be anticipated to be even more severe.

The concept that we can take beneficial policies and detrimental policies and combine them to come up with a reasonable compromise is a fallacy. Bad policies are bad policies, and they cannot be neutralized by political accommodations.

Under a well designed single payer national health program catastrophic plans would not exist. The sooner we get there, the better it will be for all of us – better for our health and better for our personal finances.

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