Long-Term Care in America: Views on Who Should Bear the Responsibility and Costs of Care

The Associated Press-NORC Center for Public Affairs Research, May 2017

Results from the 2017 Long-Term Care trends poll find that two-thirds of Americans age 40 and older feel the country is not prepared for the rapid growth of the older adult population. The Associated Press-NORC Center for Public Affairs Research survey also finds that at the local level, less than half of older Americans say their community is doing a good job of meeting older adults’ needs for nursing homes, assisted living facilities, and home health care aides to provide long-term care. Additionally, a majority of older adults say they would like the federal government to devote a lot or a great deal of effort this year to helping people with the costs of ongoing living assistance.

To help policymakers, health care systems, and families address this issue, research conducted by The AP-NORC Center examines awareness of older Americans’ understanding of the long-term care system, their perceptions and misperceptions regarding the likelihood of needing long-term care services and the cost of those services, and their attitudes and behaviors regarding planning for long-term care.

Overall, about a quarter of adults age 40 and older are able to correctly estimate the national average monthly cost of living in a nursing home, living in an assisted living facility, and hiring a part-time home health care aide.

While already underestimating the costs of most care, only 15 percent of Americans age 40 and older are very or extremely confident that they will have the financial resources to pay for long-term care.

Overall, older Americans have not done much planning for their future or current needs for ongoing assistance. Two-thirds (67 percent) say they have done only a little or no planning at all for their own needs. About a quarter (23 percent) say they have done a moderate amount of planning, and just 1 in 10 say they have done a great deal or quite a bit of planning.

Americans are confused about how they might pay for any needed care. The source that most Americans age 40 and older expect to rely heavily on to pay for ongoing living assistance is Medicare, which 57 percent say they will rely on quite a bit or completely. However, Medicare does not cover many expenses associated with long-term care, including most care in nursing homes, assisted living facilities, or from home health care aides.

Today, 70 percent of older Americans support a government-administered long-term care insurance program, similar to Medicare, a significant jump from the 53 percent who said the same last year.

Though support for a government-administered program for long-term care insurance similar to Medicare is lowest among Republicans, it still receives majority support. Eighty-three percent of Democrats favor such a program compared to 69 percent of independents and 54 percent of Republicans.

http://www.longtermcarepoll.org…

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Comment:

By Don McCanne, M.D.

Americans fear the prospects of long-term care, especially how they would pay for it should it become necessary. This survey reveals that a majority of Democrats, independents and Republicans – 70 percent overall – support a program similar to Medicare as the payment source for long term care.

The nation is ill-prepared for anticipated future needs for long-term care. Currently the most important program to cover these costs is Medicaid, but that requires the indignity of becoming destitute in order to qualify for the program.

Americans are very supportive of our Medicare program and a clear majority supports such a program for covering long-term care. The solution seems obvious; include long-term care under the Medicare program.

Single payer supporters understand that an improved Medicare for all would automatically do this. We should no longer demand destitution for those of modest means as a ticket to long term care.

Variation in Emergency Department vs Internal Medicine Excess Charges in the United States

By Tim Xu, MD, MPP; Angela Park; Ge Bai, PhD, CPA; et al
JAMA Internal Medicine, May 30, 2017

From the Introduction

Patients presenting to different emergency departments (ED) can face widely varying charges for similar care. Hospitals use chargemasters (list of services and their charges) to compile each patient’s bill, but the actual payment depends on the patient’s insurance type and network status. In-network patients and their insurers usually pay discounted amounts, whereas uninsured and out-of-network patients may be liable for the full hospital charges. In 2012, the 50 hospitals in the United States with the highest markups charged patients at least 9.2 times what the Medicare program would pay for care.

In this study, we used physician payment data from the Centers for Medicare & Medicaid Services to study the variation in markups on ED professional services and in relation to markups in internal medicine. We also examined the association between the level of markup and the characteristics of the hospitals and their patient populations.

From the Results

Nationwide, services provided by emergency medicine physicians to Medicare Part B fee-for-service beneficiaries totaled $4 billion in charges and $898 million in Medicare-allowable amounts, representing an overall markup ratio of 4.4 (340% excess charges). By contrast, the overall markup ratio for all services provided by internal medicine physicians was 2.1 (110% excess charges). Markup ratios for common ED services varied widely by procedure code and hospital.

By hospital, the aggregated markup ratio for all ED services ranged from 1.0 to 12.6; the aggregated markup ratio for all internal medicine services ranged from 1.0 to 14.1. Greater ED markup ratios by hospital were associated with for-profit status, greater uninsured population, African American and Hispanic patient populations, and location in the southeastern United States. These associations between markups and hospital characteristics were not present for internal medicine services.

From the Discussion

In this national study of hospital pricing practices in 2013, we found wide variation in excess charges for ED services relative to what Medicare would have paid. Moreover, ED services were generally priced higher than those in the internal medicine department for the same services within a given hospital. Emergency departments with the greatest markups were more likely to be for-profit and serve larger uninsured populations. These findings reinforce the recent interest among states in protecting patients from excess medical charges.

In addition to uninsured patients, insured but out-of-network patients can become subject to chargemaster prices. In the course of negotiations between insurers and physicians over payment rates, patients of physicians who remain out of network may receive a balance bill for the difference between the chargemaster price and the amount paid by the insurer. Out-of-network care can also result from hospitals outsourcing ED and other physician services to private contractors who are not part of the hospital’s insurer network.

Conclusions

Using national Medicare payment data, our study demonstrates the wide variation in the prices EDs charge patients for medical services, which can vary between 1.0 and 12.6 times the Medicare-allowable amount by hospital. Moreover, we found that hospitals typically charge patients more for similar services when performed by an ED physician compared with an internal medicine physician. In this context, the ongoing trends of uninsurance, hospital consolidation, and narrowing insurance networks since implementation of the Affordable Care Act are poised to increase the potential for patient financial harm in the years to come. Now, more than ever, protecting uninsured and out-of-network patients from highly variable hospital pricing should be a policy priority.

http://jamanetwork.com…

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Comment:

By Don McCanne, M.D.

We have long recognized the injustices of emergency department patients being charged higher rates if they are uninsured or if the physicians providing the care are not in the networks of the patients’ insurance plans. This study adds to our understanding by quantifying the extra costs faced by the patients. These charges typically are 4 times  Medicare-allowable rates for the emergency physician and as much as 12 times for the hospital.

These unjust excessive charges would not exist in a well designed single payer system – an improved Medicare for all. Patients would benefit by the elimination of cost sharing, and the professionals and institutions would be paid based on legitimate costs and fair margins. Everyone would benefit except insurers and providers who currently gouge.

Economic Analysis of the Healthy California Single-Payer Health Care Proposal (SB-562)

By Robert Pollin, James Heintz, Peter Arno, and Jeannette Wicks-Lim
Political Economy Research Institute (PERI), University of Massachusetts – Amherst, May 2017

The State of California is considering a bill to create a statewide single-payer health care system. This study provides an economic analysis of the proposed measure, The Healthy California Act (SB-562). The study includes four major sections: 1) Cost Estimate of Universal Health Care Coverage in California; 2) Cost Saving Potential under Healthy California; 3) Financing Healthy California; and 4) Impact on Individual California Families and Businesses.

The primary goal of Healthy California is to provide high-quality health care to all California residents, including those who are presently either uninsured or underinsured. The study finds that the providing full universal coverage would increase overall system costs by about 10 percent, but that the single payer system could produce savings of about 18 percent. The study thus finds that the proposed single-payer system could provide decent health care for all California residents while still reducing net overall costs by about 8 percent relative to the existing system.

We propose two new taxes to generate the revenue required to offset the loss of private insurance spending: a gross receipts tax of 2.3 percent and a sales tax of 2.3 percent, along with exemptions and tax credits for small business owners and low-income families to promote tax-burden equity.

Within this proposed tax framework, Healthy California can achieve both lower costs and greater equity in the provision of health care in California for both families and businesses of all sizes. Thus, net health care spending for middle-income families will fall by between 2.6 – 9.1 percent of income.

Small firms that have been providing private health care coverage for their workers will experience a 22 percent decline in their health-care costs as a share of payroll. The small firms that have not provided coverage will still make zero payments for health care under Healthy California through their gross receipts tax exemption. Medium-sized firms will see their health care costs fall by between 6.8 and 13.4 percent as a share of payroll relative to the existing system. Firms with up to 500 employees will experience a 5.7 percent fall, and the largest firms, with over 500 employees, will experience a 0.6 percent fall as a share of payroll relative to the existing system.

In sum, the establishment of the Healthy California single-payer system will generate financial benefits for both families and businesses throughout the California economy. For families at most income levels and for businesses of most sizes, these financial benefits will be substantial. These benefits are in addition to those that the residents of California will achieve through having universal access to decent health care.

http://www.healthycaliforniaact.org…

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Comment:

By Don McCanne, M.D.

This meticulous economic study of the the Healthy California single-payer health care proposal (SB-562) reveals that it would provide health care for all Californians while reducing net costs for almost all households and businesses. This study is much more credible than the staff committee report released last week, primarily because of the detail in this study and the application of well established health policy science to the analysis.

A multitude of articles based on the cursory staff study have been published stating that total costs and a hypothetical high payroll tax would be outrageous and totally unaffordable. This study lays those claims to rest and should be used to refute the rhetoric of the opponents of single payer reform in California.

In fact, California cannot afford to pass up this opportunity to bring health care to everyone while finally controlling our spending on it.

If you wish to see how a single payer system really could provide health care for everyone while reducing costs for businesses and households alike, you should download the full analysis and study it (link above).

Consumer Advocates Wary Of New Marketplace Rules For Brokers

By Michelle Andrews
Kaiser Health News, May 30, 2017

Signing up for coverage on the health insurance marketplace should be easier for some people this fall because new federal rules will allow brokers and insurers to handle the entire enrollment process online, from soup to nuts. Some consumer advocates are concerned, though, that customers going this route won’t get the comprehensive, impartial plan information they need to make the best decision due to the financial self-interest of insurers and brokers.

“Facilitating the participation of brokers and getting web brokers involved is a good thing for the market,” said Timothy Jost, emeritus professor at Washington and Lee University School of Law in Virginia and an expert on health reform. But there are risks for consumers. “If you’re enrolling with a web broker, you could see ‘best deals’ that often aren’t the best deal for you but are the best deal for the people who are marketing them.”

The staff at online health insurance broker eHealth is thrilled with the change.

“It’s a big deal,” said Nate Purpura, vice president of consumer affairs at eHealth. “Many people, including our CEO, have been to Washington, D.C., multiple times to explain the benefits of being able to help in this way.”

Its website, which works with 180 insurance carriers nationwide, offers about 75 percent of the plans that are available on healthcare.gov, Purpura said.

That’s a problem, say some policy analysts. Federal rules require web brokers to display basic information about all the plans that are available on the federal marketplace, whether or not they actually sell them. It includes the name of the plan and insurer that offers it, the type of plan — HMO, PPO, EPO — and metal level (bronze, silver, gold or platinum). Web brokers must also publish a disclaimer that says the website information about all the available marketplace plans might not be complete and provide a link to healthcare.gov.

But the information web brokers present about plans they sell and get a commission for may be much more comprehensive than the information provided about plans they don’t handle.

But some analysts remain concerned that details about how consumers’ privacy and security will be protected under the new system are still too vague.

“This is really sensitive information, people’s tax information, which needs to be highly protected,” said Jost. “There are a lot of concerns with confidentiality and privacy. I have some concerns about fraud.”

http://khn.org…

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The Centers for Medicare and Medicaid Services (CMS) announces streamlined direct enrollment process for consumers seeking Exchange coverage

CMS.gov, May 17, 2017

“This is another important step to help create stability in the health insurance market,” said CMS Administrator Seema Verma. “It is common sense to make it as simple and easy as possible for consumers to shop for and access health coverage. It is time to get the federal government out of the way and give patients the best tools to make their own healthcare decisions.”

https://www.cms.gov…

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Comment:

By Don McCanne, M.D.

CMS Administrator Seema Verma is expanding the role of private insurance brokers, such as eHealth, in enrolling individuals in plans offered by the government ACA health insurance exchanges. Not only do the private brokers promote only selected plans on the exchanges, they obviously are motivated to push the plans for which they receive a generous commission, whether or not the plans selected are in the best interests of the enrollees. This does not serve the applicants well.

In her CMS release, Verma states, “It is time to get the federal government out of the way.” Her pro-privatization, anti-government ideology is so intense that she says that it is “common sense” to add additional, wasteful private administrative services with these outside brokers, paying them fees with our tax money, and yet depriving enrollees of the full informational services that our current government-operated exchanges are providing.

Worse services, piling on of administrative excesses, and diverting public money to private vendors are a terrible price to pay simply to please the anti-government bureaucrats that are filling the positions of public trust in this administration.

In a recent Quote of the Day, it was recommended that her boss, HHS Secretary Tom Price, be replaced based on the potential havoc created by his adhering to his nutty anti-government ideology. She should be replaced for the same reason as well – ASAP.

This comment is the opinion of the author and is not an official view of Physicians for a National Health Program.

Will the Republican Health-Care Debacle Pave the Way for ‘Medicare far All’?

By Robert L. Borosage
The Nation, May 25, 2017

This week, the Congressional Budget Office confirmed what was already apparent: The revised House Republican health-care bill will still deprive millions of Americans — 23 million in the CBO estimate — of health insurance. Senate Republicans are devising their plan in secret, because it too will likely deprive millions of health coverage. In contrast with Republican horrors, Obamacare has grown in popularity, but premiums are rising as insurance companies consolidate monopolies in various states and Trump works to sabotage it. Surely, now is the time for progressives to wage a fierce campaign for Medicare for All.

Americans are more than ready. The popularity of expanding Medicare is surprising, given how little support it has received from the political class.

Will Republican efforts to repeal and replace Obamacare pave the way to Medicare for All? Only if progressives force the debate. Americans are looking for sensible reform. Medicare for All is the right answer. Now is the time for progressives to educate and enlist to take on the entrenched interests that stand in the way.

https://www.thenation.com…

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Comment:

By Don McCanne, M.D.

With the backlash against the Republicans for their ongoing failure to deliver effective health care reform, and with the failure of ACA to provide affordable health care for everyone, the pathway to Medicare for All may now have been paved.

Robert Borosage suggests that it is time for progressives to push the process – force the debate, educate, and enlist. But that should not be limited to progressives in the Democratic party. We should work with Republican progressives, independent progressives, Democratic Socialist progressives, and even, albeit rare, libertarian progressives. By forcing the debate, educating, and enlisting, even conservatives and others who do not usually assign to themselves the “progressive” label, should be ready for a serious consideration of single payer.

Assured health care, at a price we could all afford, who could be against that? Neither ACA nor AHCA would bring us that. Members of Congress will be home on a break this next week. Let them hear from you, though you may not want to announce yourself using the “progressive’ label.