We asked 7 experts about Sen. Brian Schatz’s big new Medicaid buy-in plan

By Jeff Stein and Dylan Scott
Vox, August 23, 2017

In a recent interview, Sen. Brian Schatz (D-HI) laid out his plan to allow every American to buy into Medicaid if their state allows it. It could be a significant expansion of the program, at the least as a public option for Obamacare’s marketplace. At the most, it could set up a road that leads to Medicaid as the vehicle for single-payer health care.

But it also raises a bunch of questions, about both the plan’s ideological goals and its policy mechanics.

We asked seven health policy experts, in the middle and on the left and right, what they thought.

Adam Gaffney, Harvard University:

Though the Affordable Care Act has so far withstood the Trumpcare battering ram, 28 million remain uninsured in the United States, an entirely unacceptable state of affairs. Might a Medicaid-based “public option,” as proposed by Sen. Brian Schatz (D-HI), be the answer?

Unfortunately, the bill would not rectify our nation’s serious health care woes. While it could potentially expand coverage, its impact would probably be modest, or even marginal: After all, in 2013 the Congressional Budget Office scored a somewhat similar public option and found that it would have no significant impact on the number of the uninsured. Moreover, Schatz’s bill would be optional for states and so would likely be declined by many, further limiting its impact. It is also probable that even with subsidies, some will find the premiums and deductibles of this plan unaffordable, as they have under the ACA.

Just as importantly, the bill would not solve the issues faced by Americans with insurance: narrow networks of doctors and hospitals, unaffordable drug prices, paltry access to dental and long-term care, and rising out-of-pocket costs (e.g., copayments and deductibles) that are squeezing household finances and creating an epidemic of “underinsurance” in America. And finally, it would not create the greater administrative efficiencies of a single-payer system, which by one estimate would be greater than $500 billion a year.

The only answer to those myriad issues is a universal single-payer “Medicare-for-all” system, which would ensure equitable access to comprehensive health for everyone in the nation. Medicare-for-all should thus remain the Democrats’ central health care goal in the coming months and years.

Robert Frank, Cornell University:

Anything you can do in this direction is a step forward.

Larry Levitt, Kaiser Family Foundation:

I read this as basically a public option delivered through Medicaid.

Loren Adler, Brookings Institution:

To me, the fundamental question here is whether you intend to create a level playing field or not.

Matt Bruenig, People’s Policy Project:

Up to this point, the liberal establishment, including Barack Obama and [the] Center for American Progress, has only endorsed what I would call the Loser Public Option.

David Anderson, Duke University:

I need to see the details.

Avik Roy, Foundation for Research on Equal Opportunity:

It’s completely unworkable.

https://www.vox.com…

***

Comment:

By Don McCanne, M.D.

Sen. Brian Schatz (D-HI) is currently drafting legislation that would allow Americans to buy into the Medicaid program, supposedly providing them with a “public option” and perhaps a path toward a single payer system in the United States. Vox has published the responses of seven “experts.”

Comments varied from those who approve based on the fact that any incremental improvement should be supported, to those opposed primarily based on conservative ideology. Those responses are recorded above with cryptic excerpts.

The response of Adam Gaffney is reproduced in its entirety since it is exceptional in that it clarifies how far off topic the current debate on reform has become. We should be discussing reform that corrects the serious defects in our overpriced and underperforming health care system. Instead the conversation has turned to disturbingly inadequate proposals such as the public option or buying into a public program.

It is not that even minimally beneficial measures should be opposed, rather we should not be burning up our resources for advocacy on these lesser measures when a single payer national health program – an improved Medicare for all – is an absolute imperative that requires urgent action. The crime is that it has required urgent action for decades while we have diddled around with deficient measures that have unnecessarily perpetuated financial hardship, physical suffering and even death.

Suppose we pass a public option or a buy-in. Those in support will celebrate success and then walk away. But what about the promise that this would lead to single payer? “Are you kidding? I support single payer, but that’s not feasible. I’m tired of you Bernie people trying to tell us liberals what to do. Get lost!”

Well, we’re more than just the Bernie people. We are a majority of the nation. We did get lost when they gave us ACA, and that didn’t lead to single payer. We can’t make that mistake again.

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NBER Working Paper No. 23530: The Role of Hospital and Market Characteristics in Invasive Cardiac Service Diffusion

By Jill R. Horwitz, Charleen Hsuan, Austin Nichols
National Bureau of Economic Research, June 2017

Abstract

Little is known about how the adoption and diffusion of medical innovation is related to and influenced by market characteristics such as competition. The particular complications involved in investigating these relationships in the health care sector may explain the dearth of research. We examine diagnostic angiography, percutaneous coronary interventions (PCI), and coronary artery bypass grafting (CABG), three invasive cardiac services. We document the relationship between the adoption by hospitals of these three invasive cardiac services and the characteristics of hospitals, their markets, and the interactions among them, from 1996-2014. The results show that the probability of hospitals adopting a new cardiac service depends on competition in two distinct ways: 1) hospitals are substantially more likely to adopt an invasive cardiac service if competitor hospitals also adopt new services; 2) hospitals are less likely to adopt a new service if a larger fraction of the nearby population already has geographic access to the service at a nearby hospital. The first effect is stronger, leading to the net effect of hospitals duplicating access rather than expanding access to care. In addition, for-profit hospitals are considerably more likely to adopt these cardiac services than either nonprofit or government-owned hospitals. Nonprofit hospitals in high for-profit markets are also more likely to adopt them relative to other nonprofits. These results suggest that factors other than medical need, such as a medical arms race, partially explain technological adoption.

From the Discussion

Between 1996 and 2014, hospitals have continued to adopt new invasive cardiac services, although the rate of adoption slowed over the study period. Larger hospitals are more likely to adopt new services than are smaller hospitals. For-profit hospitals are more likely to adopt new services than are nonprofit hospitals, which, in turn, are more likely than government hospitals to adopt new services. On average, hospitals appear to make decisions regarding the adoption of new services based on the behavior of competitors in the markets in which they operate, controlling for population size and other characteristics.

The welfare effects of our findings regarding cardiac technology diffusion are uncertain. Although the spread of technology is generally good for social welfare, this has not always been the case with health care technology. Large geographic differences in the provision of care and in spending on care cannot be explained by differences in the population treated and have not led to differences in health outcomes, suggesting that there is a great deal of waste. Cardiac treatments are typically quite profitable services for hospitals, and oversupply is a particular worry for the provision of services that tend to be profitable for providers. In fact, at the extreme, there have been distressing cases of hospitals and physician providing services, particularly profitable services such as cardiac treatments, to patients who did not need the intervention.

Although our study does not measure social welfare directly, the results suggest that current patterns of cardiac technology diffusion can either increase or decrease social welfare, depending on conditions of a health care market. Social welfare is enhanced if hospitals base their decisions to adopt on the existence of unmet medical need in their markets. And, there is some evidence that they are doing so. They are less likely to adopt a new service if the patients in their markets already have geographic access to a service at another hospital.

However, previous research finding little increase in geographic access to care suggests that adoption decisions are in fact driven by a competitor’s decision to adopt. Our results strongly support this finding. Although hospitals respond to the needs of potential patients to be within sixty minutes driving time of an invasive cardiac service, they also respond to the behavior of their competitors and adopt even if doing so duplicates existing services, failing to increase geographic access.

http://www.nber.org…

***

Comment:

By Don McCanne, M.D.

Single payer reform, as envisioned by Physicians for a National Health Program, is much more transformative than merely changing the payment process. One of the more important recommended changes is to convert for-profit entities, such as hospitals, into nonprofit status. Why should that matter?

For-profit business entities must place the interests of their investors first. Nonprofit health care entities place the interests of their patients first. Greedy business decisions are fundamental in the for-profit model which often detracts from optimal patient care, whereas the nonprofit grapples with budget problems in order to make decisions that work best for the patients.

This NBER study is an excellent example of that difference. The authors looked at crucial cardiac interventions – technical innovations that save lives. For-profit hospitals introduced these interventions as part of their competitive involvement in the medical arms race. It did not matter that the community was already being served with these technological advances; they introduced them to increase profits. After all, they are for-profit entities.

In contrast, nonprofit hospitals were less likely to duplicate these technologies if the patient needs were already being served in the community. An exception is that nonprofit hospitals in high for-profit markets were more likely to adopt the for-profit culture and duplicate the services. If the for-profit culture did not exist, it is much more likely that the nonprofits would select technology based on community need rather than profit potentials.

Greed, wasteful duplication of services, and diversion of health care dollars to passive investors are characteristics of the market-driven medical-industrial complex. We do not need nor want that in our health care system. A well designed single payer system includes regional planning and separate budgeting of capital improvements. Efficient and economical uses of resources serve the patients well.

Although we have had a surge of interest in single payer reform, we are now seeing a plethora of opinions, especially from supposedly progressive sources, that the disruption of single payer is not necessary and that we can get to an ideal system merely by simple adjustments such as adding a public option or allowing citizens to purchase Medicare or Medicaid coverage. But this approach would leave in place our fundamentally flawed health care financing infrastructure – by far the most expensive and least efficient model of financing health care. It would accomplish very little of what the PNHP model would.

Individuals touting these incremental steps need to take another look at the PNHP proposal and then explain to us just how their baby steps would ever get us to health care justice for all. Just as the touted gains of the Republican proposals proved to be hallucinatory, these touted gains of the progressives will never fill the vast void that a high performance health care system should be filling.

“Beyond the Affordable Care Act: A Physicians’ Proposal for Single-Payer Health Care Reform”:
https://www.pnhp.org/nhi

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To: The Honorable Mitch McConnell, Majority Leader and The Honorable Charles Schumer, Minority Leader, United States Senate

From: Wanda D. Filer, MD, MBA, FAAFP, AAFP Board Chair

American Academy of Family Physicians, Letter, July 17, 2017

The American Academy of Family Physicians (AAFP), which represents 129,000 physicians and medical students, believes it is time to move beyond our current health care debate that is focused on repealing major portions of current law and seek bipartisan policies that build on our collective successes, address ongoing challenges, and improve our health care system for current and future citizens.

To this end, we offer the following policy recommendations for your consideration.

I. Make health care coverage more accessible and affordable

a. Provide an opportunity for individuals between 55 and 64 years of age, who purchase their insurance in the individual market, to purchase their health care coverage through a Medicare Advantage plan.

(Continues with recommendations to prioritize and promote primary care, to stabilize markets, and other recommendations)

http://www.aafp.org…

***

Comment:

By Don McCanne, M.D.

The inadequacies of the Affordable Care Act, followed by the failure of the Republicans to advance any semblance of a better health care system that they promised us, led a majority of Americans to support single payer reform. Opponents have inundated us with their non-substantive arguments against single payer, whereas many of the supposed proponents have reverted to advocacy of the “politically feasible” approach of incrementalism – particularly protecting and expanding the existing, fragmented system of private and public coverage.

In a couple of months, we have gone from calls for “single payer,” to calls for “single payer, but not now,” and now on to calls reverting to “anything but single payer.” In deflecting single payer, we are again seeing proposals to expand the market of private plans through the addition of a “public option,” or by allowing private purchase of Medicare or perhaps Medicaid. What is left unsaid is that these approaches are public in name only since the insurers will be there to be certain that the design features will make them non-competitive – products that are worse than their own private plans. (This already happened with the public option in ACA before it was completely eliminated after Sen. Joe Lieberman’s tantrum.)

The Board of Directors of The American Academy of Family Physicians (AAFP) is now asking the U.S. Senate to support the private insurance markets by adding a choice of private Medicare Advantage plans for individuals over 55. They have not suggested an option of purchasing coverage under the traditional Medicare program. These are private plans with limited provider networks. Worse, they are overpriced because of favorable selection and gaming of risk adjustment – characteristics of private markets.

This may not seem like a very big deal, but it is, and here’s why.

Last year the AAFP Congress of Delegates passed a resolution calling for a study of “a national publicly-financed, privately-delivered health care system for all Americans” and asking that a report be presented to the 2017 Congress of Delegates meeting to be held mid-September in San Antonio, Texas. The report has been prepared, though access is restricted.

Based on the letter to the United States Senate, it can be surmised that the Board and its MD, MBA Chair likely will not be recommending to the Congress of Delegates that AAFP go on record as supporting single payer reform. The Board’s advocacy for using privatized Medicare to expand coverage does not seem to be consistent with an incremental step towards single payer Medicare for all.

Also to be presented to the Congress of Delegates is a resolution from the New York chapter calling for the American Academy of Family Physicians to endorse a national single payer health care system. Considering that the AAFP leadership has already departed on a different route, we should be concerned about whether this resolution can clear the political barriers in the Congress of Delegates.

AAFP members may want to let their delegates know if they are in favor of AAFP officially supporting single payer reform. AAFP members can also access the restricted report on the study of single payer, which includes the assessment of the Board. They may wish to send a message on the Board’s conclusions. Finally, AAFP members may also want to express their views as to the Board’s proposal to the U.S. Senate to introduce Medicare Advantage private plans as a “public option” – an obvious redirection away from a public single payer system.

AAFP Board of Directors Report F to the 2017 Congress of Delegates: Single Payer Health Care System (restricted access):
http://www.aafp.org…

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Public Opinion about the Future of the Affordable Care Act

By Robert J. Blendon, Sc.D., and John M. Benson, M.A.
The New England Journal of Medicine, August 16, 2017

In the early hours of Friday, July 28, the U.S. Senate closed debate on repealing and replacing the Affordable Care Act (ACA) without the passage of any piece of legislation and after rejecting the replacement bill previously passed by the House of Representatives. This public-opinion analysis offers a framework for looking at how the public as a whole saw the issues in this most recent debate.

Public values underlying the debate

Two underlying public values were particularly important here: support for universal coverage and the preferred role for the federal government in health care. When it came to the question of whether the federal government should ensure that all Americans have health care coverage, 6 in 10 respondents (60%) said that it should be the responsibility of the federal government. More than 8 in 10 Democrats (85%) believed this should be the responsibility of the federal government, whereas only 30% of Republicans agreed. The percentage of the general public who said that they believed it was the responsibility of the federal government increased from 42% in 2013 to 60% in June 2017.

Conclusions

What are the insights we can learn from polls during the recent congressional debate? The first insight is that the Republican Party, which is in the majority in Washington, is much more divided on health care issues than was recognized at the time of President Trump’s election, so it is difficult to enact major legislation.

The second insight is how polarized Republicans and Democrats are about the overall future of the ACA. Throughout the debate, the majority of Republican adherents favored repealing the ACA, whereas Democrats did not. This made it very difficult to have any compromise legislation. Not widely recognized is that one of the reasons no bill was ultimately enacted was the split among Republicans between repealing and replacing the ACA or repealing it without a replacement.

On most specific policy issues in the debate, Republicans and Democrats disagreed, but there is one major exception. The two parties’ adherents agree that the number of people covered by Medicaid should not be reduced in any replacement bill.

Finally, the most important change over time was not the increase in public approval of the ACA, but rather the increase in overall support for universal coverage. When confronted with millions of people losing coverage, the public became more supportive of the principle that the federal government should ensure coverage for them.

http://www.nejm.org…

***

Comment:

By Don McCanne, M.D.

In this highly credible review of public opinion on health care reform, one crucial finding really stands out above all else: “the most important change over time was not the increase in public approval of the ACA, but rather the increase in overall support for universal coverage… that the federal government should ensure coverage for them.”

So what is the response of the politicians and policy community? Some want to tweak ACA, and others want to walk away. If we were truly the democratic society we like to think we are, efforts would be underway to enact and implement policies that would take us down an affordable path to universal coverage. Such an approach would not be found in ACA but rather would be found in the enactment of a single payer national health program since it would establish truly universal coverage in a model that would be affordable for each of us.

So are we ready to put democracy to work to benefit us all? If we want a better health care system, the people are going to have to demand it.

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Proposed Rule for Quality Payment Program Year 2

CMS Fact Sheet

The Quality Payment Program, established under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), began in 2017, known as the transition year. The Program’s main goals are to:

* Improve health outcomes.
* Spend wisely.
* Minimize burden of participation.
* Be fair and transparent.

The Quality Payment Program has 2 tracks: (1) The Merit-based Incentive Payment System (MIPS) and (2) Advanced Alternative Payment Models (Advanced APMs).

Because the Quality Payment Program brings significant changes to how clinicians are paid within Medicare, the Centers for Medicare & Medicaid Services (CMS) is continuing to go slow and use stakeholder feedback to find ways to streamline and reduce clinician burden, and make it easier for clinicians to participate and put their patients first.

Fact Sheet: Quality Payment Program – 26 pages
https://qpp.cms.gov…

Proposed rule: Quality Payment Program – 1958 pages
https://s3.amazonaws.com…

Proposed rule as published in the Federal Register – 491 pages
https://www.federalregister.gov…

Link to provide comment:
https://www.regulations.gov…

***

Could MACRA Be Key to Fixing Healthcare?

By Gregory A. Freeman
HealthLeaders Media, August 9, 2017

A system that encourages shared savings and shared risk between health plans and providers could address many of the Affordable Care Act’s problems. Health plans are likely to move away from fee-for-service payments to a managed care approach, one analyst says.

The government could be sitting on a solution to the healthcare debate and not even realize it, suggests one analyst. The act that finally fixed a problem threatening to bankrupt physicians every year could show the way to fixing the Affordable Care Act, he says.

The Medicare Access and CHIP Reauthorization Act (MACRA) may provide a roadmap and policy vehicle to address questions of quality, cost, accessibility, says Bruce A. Johnson, JD, a shareholder with the Polsinelli law firm in Denver, CO.

MACRA is based on the idea of shared risk and shared savings, and Johnson says the same theory could be applied to the ACA. Health plans are already moving in that direction, without waiting for the government to lead, he says.

Known as the “doc fix,” MACRA is a recent bi-partisan legislative action that eliminated a nearly 20-year-old problem with how Medicare set payments to physicians. Congress passed the act in 2015 to put an end to an annual drama in which physicians faced huge Medicare pay cuts, 21% that year, if legislators didn’t take emergency measures to stop it for another year.

By fixing the problem, MACRA eliminated substantial uncertainty about the stability of Medicare related to physicians leaving the program because they couldn’t make enough money – similar to how profitability issues have driven health plans out of the state exchanges.

MACRA introduced performance-based reimbursement by rewarding practices that participate in alternative payment models (APMs) such as accountable care organizations (ACOs), and through a merit-based incentive payment system (MIPS).

The first couple of years focused specifically on Medicare-only programs, but then in future years some of the MACRA models include consideration of commercial populations, he notes.

“Health plans are incrementally trying to move toward different forms of shared savings programs and some level of risk for providers. We’re seeing United and the Blues doing some of that, and clearly Medicare Advantage plans are in one way or another willing to have providers take risks through capitation or basically managed care,” Johnson says.

http://www.healthleadersmedia.com…

***

Comment:

By Don McCanne, M.D.

The comment period for the proposed rule for CMS’s Quality Payment Program closes Monday, August 21. Thus you have this weekend to provide your input, or live with the consequences (comment link here).

To get a quick idea of what this is about, you do not have to read the full 491 pages of the Federal Register where the proposed rule is published, rather you can check the fact sheet provided by CMS (link above). The first three pages describe the CMS Quality Payment Program, MACRA, MIPS, and APMs, and most of the rest of the 26 pages is a table that lists the provisions of the proposed rule. You should skim through that table and, as you do so, ask yourself how this helps patients. (You will not need to ask yourself how this might increase physician burnout because it will be patently obvious.)

CMS Secretary Tom Price has said repeatedly that he would reduce the regulatory burden on physicians. Yet, as a Member of Congress, he was a leader in passing the MACRA legislation. The purpose was to end the flawed SGR formula for physician payment, and to consolidate and expand the quality payment programs. But it is the quality payment programs themselves under MACRA, MIPS and APMs that are so maddening in expanding the useless administrative burden being placed on physicians.

So why has there been such dogged support for this program? The HealthLeaders Media article gives us a clue. Bruce A. Johnson, JD says, “Health plans are incrementally trying to move toward different forms of shared savings programs and some level of risk for providers. We’re seeing United and the Blues doing some of that, and clearly Medicare Advantage plans are in one way or another willing to have providers take risks through capitation or basically managed care.”

THE PRIVATE INSURERS ARE TRANSFERRING RISK TO THE PHYSICIANS. Excuse the shouting, but this point seems to be important. Not only are they dumping more administrative burdens on the physicians, they are trying to dump on them their own responsibility for insuring risk. Talk about an industry that we really do not need in health care today. We are paying them huge sums as they shirk their responsibilities.

If you are interested in providing comment on this rule, the instructions are at the beginning of the proposed rule as published in the Federal Register (link above). But, again, you will have only this weekend to do it since the comment period will close Monday.

After this weekend, we need to get back to the task of throwing out the private insurance industry. At the same time we need to recognize that this is our government that has enacted and is implementing MACRA and the Quality Payment Program. We cannot overemphasize the importance of “Improved” in a single payer Improved Medicare for All. Keep alert.

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Medicare-for-All Isn’t the Solution for Universal Health Care

By Joshua Holland
The Nation, August 2, 2017

(Excerpts)

Within the broad Democratic coalition, it’s pretty clear that the discussion of health care has shifted to the left.

But that momentum is tempered by the fact that the activist left, which has a ton of energy at the moment, has for the most part failed to grapple with the difficulties of transitioning to a single-payer system. A common view is that since every other advanced country has a single-payer system, and the advantages of these schemes are pretty clear, the only real obstacles are a lack of imagination, or feckless Democrats and their donors. But the reality is more complicated.

For one thing, a near-consensus has developed around using Medicare to achieve single-payer health care, but Medicare isn’t a single-payer system in the sense that people usually think of it. This year, around a third of all enrollees purchased a private plan under the Medicare Advantage program. Around one-in-four Medicare enrollees also purchase some sort of “Medigap” policy to cover out-of-pocket costs and stuff that the program doesn’t cover, and then there are both public and private prescription drug plans.

But from a policy standpoint, Medicare-for-All is probably the hardest way to get there. In fact, a number of experts who tout the benefits of single-payer systems say that the Medicare-for-All proposals currently on the table may be virtually impossible to enact. The timing alone would cause serious shocks to the system.

Harold Pollack, a University of Chicago public-health researcher and liberal advocate for universal coverage, says, “There has not yet been a detailed single-payer bill that’s laid out the transitional issues about how to get from here to there. We’ve never actually seen that. Even if you believe everything people say about the cost savings that would result, there are still so many detailed questions about how we should finance this, how we can deal with the shock to the system, and so on.”

It’s true that every other developed country has a universal health-care system, and we should too. But make no mistake: Moving the United States to national health care would be unprecedented, simply because we spend more on this sector than any other country ever has.

“Bringing costs down is a lot harder than starting low and keeping them from getting high,” says (Dean) Baker. “We do waste money on [private] insurance, but we also pay basically twice as much for everything. We pay twice as much to doctors. Would single-payer get our doctors to accept half as much in wages? It could, but they won’t go there without a fight.

Rather than making Medicare-for-All a litmus test, we should start from the broader principle that comprehensive health care is a human right that should be guaranteed by the government—make that the litmus test—and then have an open debate about how best to get there. Maybe Medicaid is a better vehicle. Perhaps a long phase-in period to Medicare-for-All might help minimize the inevitable shocks. There are lots of ways to skin this cat.

An obvious alternative to moving everyone into Medicare is to simply open up the program and allow individuals and employers to buy into it.

Yale political scientist Jacob Hacker’s “Health Care for America” proposal… would have left employment-based insurance—and Medicare coverage for the elderly—intact, and created a large new Medicare-like public insurance program that would have been far more robust than anything contemplated during the development of the ACA.

We shouldn’t make promises that we aren’t going to be able to keep. “It’s not going to be easy to do,” Jacob Hacker says, “and anyone who tells you that the most expensive health-care system in the world is going to undergo a sudden shift to highly efficient and low-price medicine has not been studying American medicine.”

https://www.thenation.com…

***

Can Medicare for All Succeed?

By Steffie Woolhandler, David U. Himmelstein, Ida Hellander and Joshua Holland
The Nation, August 16, 2017

To the editors:

Joshua Holland’s anti–single payer screed (“Medicare for All Isn’t the Solution for Universal Health Care”) is so riddled with misinformation and outright errors that it makes one wonder whether The Nation has laid off its fact-checkers.

Just one example: In arguing the impossibility of a health-care transformation in a high-spending nation, Holland claims that Switzerland’s health expenditures in 1996 amounted to only 5 percent of GDP. The correct figure is 9.2 percent. [Editor’s Note: This has been corrected in Holland’s article.]

He suggests that cost control under single payer requires halving doctors’ incomes, a serious political problem if it were true. But Canadian doctors make about 80 percent what their US counterparts do, and, taking into account their lower educational debt and post-retirement health expenses (more than $250,000 per couple in the United States), they’re about as well off financially as their US counterparts. Moreover, most US single-payer projections foresee increased spending on physician visits once copayments are abolished, and simplified billing would reduce the bite that office overhead takes out of doctors’ take-home pay.

Holland falsely claims that no one has provided guidance on the transition to single payer. We, and our colleagues in Physicians for a National Program have published in the Journal of the American Medical Association, The American Journal of Public Health, and the New England Journal of Medicine several quite detailed proposals laying out transition plans for acute-care financing, long-term care, and quality monitoring; another, on prescription-drug regulation and financing, is in the works. We’ve analyzed in detail the likely shifts in administrative costs and employment, and the federal single-payer legislative proposals include funding for job retraining and placement and income support to transition the million or so insurance and administrative workers who currently do useless bureaucratic work and whose jobs would be eliminated under single payer. While the transition would be disruptive for some administrative workers, it would be simple for hospitals (they’d stop billing for each patient, Band-Aid, and aspirin tablet and instead be paid lump-sum budgets), and a welcome relief for doctors and nurses, who suffer record high burnout rates in the current medical-industrial complex. That’s why recent polls show that around half of doctors favor single payer (and 21,000 of them have joined Physicians for a National Health Program), and National Nurses United, the leading nurses’ union, is the nation’s strongest single-payer proponent.

Most egregiously, Holland misrepresents the single-payer legislation that’s actually been proposed, citing Medicare’s deficiencies to smear reform proposals. As the title of John Conyers’s bill HR676, the Expanded & Improved Medicare for All Act, makes clear, that legislation would upgrade Medicare coverage, eliminating copayments and deductibles, and fix its other flaws. Holland suggests that, since many Medicare recipients supplement their coverage with private policies, such legislation would boost out-of-pocket costs for millions who currently have employer-paid coverage or Medigap policies. In fact, virtually no one would face increased copayments or deductibles under HR 676 (or Bernie Sanders’s forthcoming legislation, or the many state bills), although wealthy Americans’ taxes would rise. And few people would complain about being freed from insurers’ narrow provider networks; not one of the Medicare Advantage plans, without out-of-pocket benefits, covers care at New York’s Memorial Sloan Kettering Cancer Center. Under single payer patients could, as in Canada, choose any hospital or doctor.

Holland’s scare-mongering about the chaos likely to ensue during a transition to single payer echoes The Wall Street Journal’s dire predictions of “patient pileups” and other disasters at the dawn of Medicare in 1965. It didn’t happen then and wouldn’t happen now. Medicare, sans computers, enrolled 18.9 million seniors (displacing private insurance for many of them) within 11 months of its passage.

The real enemies of single payer aren’t the disgruntled patients or doctors whom Holland features but the insurance and pharmaceutical firms that he barely mentions. That powerful opposition is the real problem we have to overcome, not the imagined chaos of the transition or the phony fear that patients would revolt against better coverage.

David U. Himmelstein, M.D.
Steffie Woolhandler, M.D., M.P.H.

The authors are primary-care physicians, distinguished professors of public health at the City University of New York at Hunter College, and lecturers in Medicine at Harvard. They founded Physicians for a National Health Program and served as health-policy advisers during Bernie Sanders’s presidential campaign.

***

To the editors:

Liberals have created a new single-payer bogeyman to justify their renewed pursuit of failed incremental policies for health reform, as in Joshua Holland’s recent article. It used to be that single payer was not “politically feasible.” Now, according to the likes of Holland, Harold Pollack, and Dean Baker, the problem is that single-payer advocates haven’t worked out a plan to “implement” single payer, or the “brass tacks.”

In fact, implementation is the easy part of health reform. The Canada Health Act is less than 14 pages long, and is only that long because it is also printed in French. Taiwan, which had 40 percent of its population uninsured, installed a universal single-payer system ahead of schedule in less than a year in 1995. The ease of adoption of the American Medicare program also bodes well for single payer, as Holland admits. Indeed, nearly every implementation issue Holland raises is already addressed in the Physicians Proposal for Single Payer National Health Insurance (2015) and Representative John Conyers’s bill, HR 676, the “gold standard” for single-payer legislation.

The “single payer” envisioned in these proposals is not today’s Medicare, of course, but an improved version of Medicare, with more comprehensive benefits, and greater ability to control costs. HR 676 may not specify an exact financing plan, but gives specific enough parameters so that whatever financing plan is adopted (one possible plan is here) it will shift the burden from the sick and poor to the healthy and wealthy, and make care free at the point of delivery. Private employers only pay a paltry 20 percent of the current health care tab, which can be recouped with a small payroll tax or tax on corporate revenues (as recently proposed by Robert Pollin for California). According to a study by David Himmelstein and Steffie Woolhandler in the American Journal of Public Health, taxes already fund over 64 percent of health care in the United States, so moving to a publicly-funded plan is a shift, not a radical change.

Holland asserts that physicians will have to be paid less under single payer, which is false. There are many advantages to a single-payer system, not least of which is the saving of $500 billion annually currently wasted on insurance overhead and excess provider bureaucracy—more than enough money to cover the extra costs of clinical care for the uninsured and underinsured, and to eliminate copays and deductibles for everyone, without cutting physician pay. Having said that, the single payer system will have the ability to shift more funding towards primary care over time, which would help with both access and costs down the road.

Bizarrely, Holland tries to revive Jacob Hacker’s discredited proposal for a “public option” that would compete with private insurers. The premise for Hacker’s proposal is that Americans are “stubbornly attached,” in Hacker’s words, to employer-based insurance and don’t want to give it up, refuted by Kip Sullivan in this blog post. But polls show that over two-thirds of Americans favor Medicare for All. Adding one more insurance company to our fragmented and failing health system will not cover everyone or control costs.

Proposals for incremental reform to “fix” rather than “repeal” the ACA are now on the congressional agenda, but much more fundamental reform is needed. If Congress passed single payer today, we could implement it within a year and save tens of thousands of lives. Time to get to work.

Ida Hellander, M.D.

Ida Hellander, M.D., is a former executive director and director of national health policy (1992–2017) at Physicians for a National Health Program.

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JOSHUA HOLLAND REPLIES

Himmelstein and Woolhandler aren’t alone in accusing me of dishonestly failing to note that Representative John Conyers’s Medicare-for-All bill would “fix” the current program’s “flaws,” including the fact that Medicare is not currently structured as a single-payer program. But I wrote quite clearly that, “if we were to turn Medicare into a single-payer program, as some advocates envision, then we’d also be asking a third of all seniors to give up the heavily subsidized Medicare Advantage plans that they chose to purchase. Consider the political ramifications of that move alone.”

Like other critics, Ida Hellander simply wishes away what I see as the central issue of loss aversion, citing a 2009 blog post by Kip Sullivan which asserts that “two-thirds of Americans support Medicare-for-all.” Sullivan cites a number of conflicting polls conducted in the early 2000s. We have more recent indications of how the American public feels about government involvement in health-care provision now, seven years after the Affordable Care Act was enacted: Pew’s oft-cited poll from June of this year found that, while a record high 60 percent of respondents say that it’s the government’s responsibility to cover everyone, only 33 percent said that should be accomplished through a “single national government program,” and the remainder offered that it should be done through a mix of public and private programs or were unsure.

Loss aversion is a very well documented phenomenon, and it is entirely irrational. In one famous study, one set of participants were given $50 and offered a choice between keeping $30 or taking a 50/50 all-or-nothing bet. Another group were offered the same terms, but this time the choice was phrased as losing $20 or taking the bet. Just changing the wording from “keeping $30” to “losing $20” resulted in a significant increase in those willing to roll the dice—such is our distaste for losing something we have.

Status-quo bias is another very real, and not entirely rational phenomenon—people tend to wary of change, especially sudden or radical change. And of course, the next debate over health-care reform won’t be conducted honestly, as we’ve seen from the opposition to the Affordable Care Act. It’s telling in that arguing that “implementation is the easy part of health reform,” Dr. Hellander cites the experience of Taiwan, which in 1994 was a country of 21 million that was still transitioning from a military dictatorship and spent 5 percent of its GDP on health care.

Unfortunately, these writers and other critics confirm my worry that a single, extremely difficult route to universal coverage is fast becoming a litmus test for progressives. All have attempted to excommunicate me from the left, framing my piece as part of an attack, perhaps a concerted one, on single payer by “liberal” opponents. The reality is that I have long been, and will continue to be, an advocate of establishing a universal health-care system that might be called “single payer.” But I continue to think that rapidly moving much of the population into a single program—without first either creating a model at the state level or delivering some tangible benefits through more modest Medicare expansions—is a recipe for failure.

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Reader Comment:

By Don McCanne, M.D.
The Nation, August 17, 2017, submitted at 11:13am
 
Since Joshua Holland has had both the first and last word, this addendum is appropriate.

Holland mentions loss aversion and status quo bias and offers the example of some seniors giving up their Medicare Advantage plans, but that would not be all that bad. The proposed Medicare-for-All benefits would be greater, and patients would have free choice of their physicians and hospitals instead of being limited to the provider networks of the insurer. Also, Medicare Advantage plans have been wasting taxpayer dollars through favorable selection (marketing to the lower-cost healthier beneficiaries) and by gaming risk adjustment, not to mention diverting taxpayer funds to passive investors.

Holland seems to dismiss the evidence of a surge in support for single payer by citing the Pew poll reporting that only 33 percent supported “a single national government program.” If he had checked the topline of the Pew poll he would find that only 60 percent were asked this question. The 33 percent was the portion of the total population polled, including those not asked the question, but it was 55 percent of those who were asked – a number closer to other polls on single payer. (Yes, they had filtered out the remaining based on a question about government responsibility for making sure all Americans had coverage, but that is not dissimilar to earlier poll results showing that Americans support the Affordable Care Act but oppose Obamacare. It is a glitch that limits the interpretation of the results.)

But the fundamental problem presented by Holland, Baker, Pollack, Hacker and others is that they support a universal, public health care financing program, regardless of the single payer label, yet they insist on taking at least two steps over the chasm. There is no dispute about policy. Single payer is much more effective, efficient, equitable and affordable than other comprehensive models, except for a national health service. The debate seems to be over negotiating the political barriers to reform.

In supporting various incremental reforms, they would leave in place the most expensive and least efficient model of financing health care – our current fragmented, dysfunctional multi-payer system composed of a multitude of private and public programs.

Once you get down to designing a public option or modifying Medicare for individual purchase, you end up with only one or two more options in our dysfunctional market of private plans. You gain almost none of the efficiencies of a single payer system, and you can be sure that the insurers will be there to see that the design will prevent “unfair competition” by the public insurer (ironic considering that their gaming has given their private Medicare Advantage plans an unfair financial advantage over the traditional Medicare program, at taxpayer expense).

Holland, Pelosi and many others suggest that we enact single payer on a state level first, but that would require comprehensive federal legislation to free up funds to be used by states – simple waivers will not do it since they are very limited by law in what they can accomplish. Also there is risk that conservative state administrations would not provide a program that would adequately serve their residents (think of the refusal to accept federal funds for Medicaid).

The single payer policies are the moral imperative – affordable health care for absolutely everyone. Incremental measures leave the current botched up policies in place. Instead of trying to compromise on policy, we need to fix the politics. Hopefully Holland and the rest will work with us on that.

Don McCanne, M.D. is senior health policy fellow for Physicians for a National Health Program.

https://www.thenation.com…

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Adam Gaffney and Margaret Flowers have also provided excellent responses to Joshua Holland’s article in The Nation:

Adam Gaffney, Jacobin, “Medicare for All Should Be a Litmus Test”:
https://www.jacobinmag.com…

Margaret Flowers, Health Over Profit, “Response to Nation Article on Single Payer: Improved Medicare for All is the Solution”:
http://healthoverprofit.org…

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