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Medicare Advantage coding intensity could cost taxpayers $200 billion

Medicare Advantage coding intensity could cost taxpayers $200 billion

Projected Coding Intensity In Medicare Advantage Could Increase Medicare Spending By $200 Billion Over Ten Years

By Richard Kronick
Health Affairs, February 2017

Abstract

Over the past decade, the average risk score for Medicare Advantage (MA) enrollees has risen steadily relative to that for fee-for-service Medicare beneficiaries, by approximately 1.5 percent per year. The Centers for Medicare and Medicaid Services (CMS) uses patient demographic and diagnostic information to calculate a risk score for each beneficiary, and these risk scores are used to determine payment to MA plans. The increase in relative MA risk scores is largely the result of successful efforts by MA plans to identify additional diagnoses, also known as coding intensity, and not of changes in enrollees’ true health. In this article I estimate the effects of coding intensity on Medicare spending over the next decade. Under the moderately conservative assumption that coding intensity will decelerate, Medicare expenditures are expected to increase by approximately $200 billion. CMS has implemented a variety of strategies since 2010 that lessened the impact of coding intensity on Medicare spending; it has a variety of policy responses at its disposal to mitigate the impact going forward. The problem could be largely solved if CMS adjusted for coding intensity using the principle that MA beneficiaries are no healthier and no sicker than demographically similar fee-for-service Medicare beneficiaries, returning to the budget-neutrality approach that was introduced in 2004 and later abandoned.

From the Introduction

In the three decades that Medicare has been contracting with health maintenance organizations and other health plans, figuring out how to pay the plans accurately and fairly has posed a persistent challenge. Rapid growth in enrollment in Medicare Advantage (MA) plans has raised the stakes involved in getting the answer right: Over 30 percent of Medicare beneficiaries are enrolled in Medicare Advantage and account for an estimated $200 billion in Medicare payments in 2017, or approximately 1 percent of the gross domestic product.

House Speaker Paul Ryan’s proposal to convert Medicare into a premium support system raises the stakes even further. In such a system, beneficiaries might be required to pay a larger premium for traditional Medicare than for Medicare Advantage. It is critically important that any premium differential between traditional Medicare and Medicare Advantage under premium support reflect differences in efficiency, quality, and covered benefits, and not differences in risk selection or coding practices.

The inclusion of diagnoses in the payment system creates strong incentives for MA plans to report as many diagnoses as they can legitimately support—incentives that are not present in traditional Medicare. As a result, the average risk score for MA enrollees has increased by approximately 1.5 percent per year more than the average risk score of fee-for-service (FFS) Medicare beneficiaries over the past decade, with little indication that the relative morbidity of MA enrollees has actually increased. If this remarkably consistent rate of increase in relative Medicare Advantage risk continues over the next decade, Medicare payment will increase dramatically.

Despite the attention given to coding intensity by CMS and Congress over the past decade, unless there is a further policy response, Medicare will substantially overpay MA plans over the coming decade—likely to the tune of hundreds of billions of dollars.

From the Discussion

Political And Technical Obstacles

The political obstacles to a robust solution are formidable. Aggressive action to mitigate the effects of coding intensity would raise the ire of the Medicare Advantage industry and might well engender a lobbying effort involving the spectacle of buses circling the Capitol, with multitudes of MA enrollees imploring members of Congress to protect their benefits. The Medicare Advantage industry and enrollees would be angered by the prospect that aggressive response to coding intensity would increase premiums or reduce supplemental benefits enabled by the rebates that plans receive for bidding below their benchmarks.

In addition, aggressive action to mitigate the effects of coding intensity might raise concern among some policy makers about the stability and growth of the Medicare Advantage program.

The technical obstacle is determining how to accurately measure coding intensity. As discussed more fully in the Appendix, various reasonable approaches exist to measure the effects of coding intensity.

Budget-Neutrality

As originally conceived, the budget-neutrality adjustment was not designed as an adjustment for coding intensity, but it could serve that purpose well moving forward. It rests on a simple principle: namely, that MA enrollees are no healthier and no sicker than demographically similar FFS Medicare beneficiaries. If one accepts that principle, then it follows that aggregate payments to MA plans should be equal to the amount that would have been paid using demographic risk adjustment. As shown in this article, if CMS were to calculate the coding intensity adjustment using this principle, payments to MA plans would be approximately $200 billion less over the next decade than if the coding intensity adjustment remained at the statutory minimum of 5.91 percent.

Although there is evidence that the introduction of diagnostic risk adjustment using diagnoses from ambulatory care encounters in 2004 reduced favorable selection into MA plans, analyses by Joseph Newhouse and colleagues show that favorable risk selection into Medicare Advantage likely remains to some degree. More recent evidence provided by Pete Welch and me, and extended in Exhibit A-2 of the Appendix to this article, also suggests that MA enrollees are no sicker, and may well be healthier, than demographically similar FFS Medicare beneficiaries. Thus, the budget-neutrality method of calculating the coding intensity adjustment will result in payments to Medicare Advantage that are at least fair, if perhaps still slightly too generous.

Conclusion

The analysis presented in this article cannot solve the political problem of creating support for a robust response to the problems created by differential coding in Medicare Advantage. I hope, however, that this work will create the foundation for a solution to the technical problem by fostering a discussion of how best to measure and adjust for differential coding between Medicare Advantage and fee-for-service Medicare. Solving this problem is an important prerequisite to the establishment of a stable and equitable future for the current Medicare Advantage program, and even more important if Congress were to convert Medicare into a premium support system.

http://content.healthaffairs.org…

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Comment:

By Don McCanne, M.D.

Some long-time readers of these messages may be bored by yet another article confirming that the private Medicare Advantage plans have been successful in being paid significantly more than we are spending for comparable patients in the traditional fee-for-service Medicare program, but it is crucial to understand that this is a major part of the strategy to privatize the Medicare program, and we taxpayers are being cheated as they pull off their scheme.

This year we will see intensified efforts to convert to a premium support program (vouchers) which will enrich private insurers as costs are transferred onto the backs of Medicare beneficiaries, with the goal of privatizing the entire Medicare program. Insurers win, patients lose, and the libertarian ideologues snicker in the background.

There are two methods by which the private insurers are overpaid. They engage in favorable selection – using devious methods to enroll healthier patients – thus spending less than they would if their enrollees were of average health. They also have gamed risk adjustment – qualifying for extra payments by submitting claims indicating that their enrollees are sicker than they actually are.

About one-third of these extra payments are used to enhance benefits, thus enticing seniors to enroll in their plans instead of the traditional Medicare program. You can imagine how attractive lower deductibles could be to individuals who just turned 65 and are used to dealing with private plans. By marketing heavily to them they further improve their favorable selection since those just 65 years old are the healthiest and least expensive members of the Medicare population.

And that other two-thirds of the extra payments? They keep that to help pay for their high administrative costs that characterize the unique waste in the U.S. health care financing system.

But why should Medicare Advantage patients receive more benefits than those remaining in the traditional program? If the same extra payments were used to reduce deductibles and coinsurance in the traditional program then there would be no reason to select the private plans, especially since there are no network restrictions such as those instituted by the private plans. More choice, at no extra cost.

You say you don’t want to increase taxes to pay for better benefits in the traditional Medicare program? Then, for the sake of fairness, at least decrease the overpayments to the private Medicare Advantage plans to the same level that we are paying for the traditional program. Of course, because of their administrative excesses, they could never compete, and they would just go away (just as they were doing under the Medicare + Choice program that was discontinued when the insurers proved that it was impossible for them to provide higher quality at a lower cost).

The study author, Richard Kronick, suggests that we switch to a budget neutrality method of correcting the overpayments. That might reduce the problem of differential coding for risk adjustment, but we could still face the deceptive, opaque methods the insurers use to gain favorable selection.

Regular readers know what the solution is. Throw out the private insurers, improve the traditional Medicare program, and then use it to cover everyone – greater value while ensuring health care access for all.

A Vote for Tom Price is a Vote to Destroy Medicare

By Nancy J. Altman
The Huffington Post, Feb. 7, 2017

No one voted to destroy Medicare. Yet, the first battle in the war over Medicare has arrived.

Why would anyone want to destroy Medicare? It has stood the test of time. The smart policy is to expand it to everyone. Medicare shows government at its best.

Government at its best! There’s the rub: Given Medicare’s proven success — its low administrative costs, its efficient coverage of those with the greatest medical needs and costs, and its enormous popularity — it is no wonder that anti-government zealots hate the program.

Medicare demonstrates that there are some services that the federal government provides better than the private sector. The mere existence of Medicare (and Social Security) puts the lie to the claim that everything should be privatized. For that reason, today’s Republicans, who hate government and want to privatize everything, are determined to end Medicare as we know it.

One of those anti-government zealots, Representative Tom Price (R-GA), has been nominated by Donald Trump to be the fox in the Medicare hen house — Secretary of Health and Human Services, the Department responsible for the administration of Medicare. He has made his antagonism to Medicare clear.

Against all evidence, Price claims that “nothing has had a greater negative effect on the delivery of health care than the federal government’s intrusion into medicine through Medicare.” Of course, the exact opposite is true. Medicare saves lives. It allows seniors and people with disabilities, those with the greatest health needs, to obtain life-saving health care.

With true radical zeal, Price has said “we will not rest until we make certain that government-run health care [e.g., Medicare] is ended.” If confirmed by the Senate, Price will be in a powerful position to carry out his threat to end Medicare.

There are two ways to destroy Medicare. One is legislatively. The other is administratively. If Representative Tom Price is confirmed to be the Secretary of Health and Human Services, he will be in a position to destroy it both ways, and along with it, Medicaid, the Affordable Care Act, and so many other programs vital to the health and well-being of all of us.

Let’s start with destruction by legislation. Right after the election, Speaker Paul Ryan made clear his plan to end Medicare legislatively. He falsely announced that repealing Obamacare requires “reforming” Medicare. His reform? Send seniors and people with disabilities into the private insurance market armed with nothing but an inadequate amount of cash. Anyone who knew the world before Medicare knows that seniors and people with disabilities were often unable to buy insurance at any price. Those who could were forced to pay exorbitant prices.

That is the world to which the aptly named Price wants to return us. Price, chairman of the Senate Budget Committee and Ryan co-conspirator, reinforced Ryan’s Medicare threat by revealing that the Republicans planned to enact Medicare privatization in the first six to eight months of the Trump administration.

As Secretary of Health and Human Services , Price would be in an even more powerful position to work to end Medicare. Rather than one of 435 members of the House of Representatives, he would, if confirmed, be the Trump administration’s chief Medicare spokesman.

And, as the top Medicare person, he could do even more destruction than pushing legislation that ends Medicare. As Secretary, he could revoke regulations that protect Medicare beneficiaries and could issue regulations that harm them. Moreover, policymakers, researchers and others rely on the Department of Health and Human Services for accurate, reliable data. In this world of alternative “facts,” could anyone trust the data put forward by a Department Secretary who is determined to end Medicare?

Senate Democrats recognize the threat. To deprive Price of all this power over Medicare, they boycotted the Committee vote on his nomination, since the rules require the presence of at least one member of the opposition party. So, what did their Republican counterparts do? They ignored the rules and unanimously voted him out of Committee with no Democrats present.

With the Muslim ban appropriately dominating the national news and with Senate votes coming up on so many nominees who want to undermine the very missions of the agencies they will control, it is easy to feel overwhelmed. Anti-public schools advocate Betsy DeVos was just confirmed as Secretary of Education after an unprecedented tie vote . Racist Senator Jeff Sessions may, in the next few days, be confirmed as Attorney General, and therefore be in charge of our civil rights.

But here is the oddly good news. Sessions’ confirmation vote is scheduled to come before the vote on Price. Outrageous as it will be, if Sessions is confirmed, it will mean that other Cabinet nominees, including Price, can be blocked with just two Republican Senators voting with the Democrats.

I am deeply suspicious that Senators Susan Collins’s and Lisa Murkowski’s votes against Betsy DeVos were not courageous and principled. Rather, I believe that they may have been just the opposite – cowardly and cynical. After all, if they really wanted to block DeVos they could have done it in committee. McConnell may have granted Collins and Murkowski permission to vote against DeVos, knowing their votes were not needed and recognizing that their constituents were strenuously opposed to DeVos’s confirmation.

Collins and Murkowski can prove me wrong by voting against putting Tom Price in charge of Medicare, a program that he himself has proclaimed he wants to end. After all, bad as DeVos is, education is still largely a state and local matter. Not true for Medicare, which is a completely federal program.

If Price is confirmed by all (or all but one) Republican Senator voting for confirmation, it will be clear that Collins and Murkowski acted cynically in voting for DeVos. It will also be clear that the Republican Party wants to destroy Medicare.

Those of us working to expand, not cut Medicare will do everything we can to assure that the American people understand that a vote for Price is a vote to destroy Medicare. We will do all we can to assure that the electorate never forgets who voted for Price, and, in so doing, voted to destroy Medicare.

That may feel like a threat. I prefer to think of it as a promise.

Nancy J. Altman is founding co-director of Social Security Works. Email your Senators today and tell them to oppose Tom Price’s confirmation as Secretary of Health and Human Services.

http://www.huffingtonpost.com…

State needs single payer

By Michael Kaplan, M.D.
The Berkshire Eagle (Pittsfield, Mass.), Feb. 7, 2017

With an unpredictable president now in the White House, with no track record and conflicting promises about health care in the U.S., we must mobilize and lobby for health care changes that identify and fix what’s wrong with our dysfunctional health care system. We must preserve what works, and never settle for a health care system that does not promise quality care to all Americans. We cannot go backwards.

As a family physician practicing in a rural, underserved region, I want to provide care to all, without the barriers our current system places in our patients’ path to health. I would also like to do away with the restrictions that private insurance imposes on our practices, restrictions that cause uncountable administrative hassles, which can lead to physician burnout and exacerbate a shortage of primary care providers.

I work for Community Health Programs (CHP), a federally qualified health center (FQHC) that operates a network of health care practices in the Berkshires. Our practices, in North Adams, Adams, Pittsfield, Lee and Great Barrington, are primary care centers staffed by physicians and nurse practitioners specializing in family medicine, pediatrics and adult medicine. CHP also has two dental centers, a family service center and an obstetrics-gynecology practice.

CHP is licensed by the federal government to provide health care to a unique geographical region, and like more than 1,100 such FQHCs around the nation, is funded by private and subsidized insurance, Medicare and Medicaid, federal grants and donations. We have a mandate to provide care for all who need it, without regard to income, immigration status or disability.

Though the Affordable Care Act (ACA), also know as Obamacare, has expanded health care coverage for millions of Americans, and to many in our region, our system’s ability to function well is seriously impaired by health care financing that was actually worsened under the ACA. The ACA funneled public dollars into the private insurance industry, with their high administrative costs and profit. We must instead develop tax-supported universal health insurance — an expanded and improved Medicare for All.

Since the advent of the ACA, our patients have experienced rising deductibles and a shrinking network of physicians and hospitals. Many specialists in our area are overbooked or are unwilling to accept the insurance plans, so our patients often are forced to travel as far as Worcester or Boston for care. Many patients from nearby New York state on ACA plans can no longer access CHP health care because of narrow networks. These are just some of the downsides for patients.

Collaborative approach

For physicians who are struggling with providing excellent care to our patients, the administrative burdens are unbearable. Each health plan requires its own excessive paperwork, simply to get our patients the treatment that they need.

For CHP, a bright spot in our network is our success in implementing the patient care standards of the Patient Centered Medical Home or (PCMH), a national initiative. Our Lee practice was recently recertified as a PCMH, which calls for integrated, team-based care that hearkens back to a time when family doctors were more easily able to coordinate care. As a result, our practice now includes many collaborators: on-site psychiatrists, social workers, physical therapists and nutritionists. We work together to provide coordination of care. CHP practices in Pittsfield and Great Barrington are also PCMH-certified.

A key piece of the PCMH effort is the integration of behavioral health with primary care. Research has shown that housing primary and mental health care in a single practice site can markedly improve overall community health — and we are already seeing results. Along with BMC and the Brien Center for Mental Health and Substance abuse, CHP received a federal grant in 2014 to increase mental health services on site at our primary care practices. In this model behavior health clinicians work shoulder to shoulder with primary care practitioners. Already we are seeing improved health among our CHP patients with this on-site mental health access.

All of the above, however imperfect, are endangered by an ineffectual health care financing system. The new administration in Washington plans to dismantle or undermine the ACA, weaken Medicare and Medicaid, and damage the patchwork of financing that has allowed FQHCs and other primary care practices to provide needed care to those who most need it.

Before it was passed, progressive Sen. Bernie Sanders and Rep. Dennis Kucinich arranged to add funding to the ACA to bolster health centers like ours. These men are proponents of true health care financing reform: a government-financed privately-run health care system that would cover all Americans. This system would be an expanded, improved Medicare for All — a single-payer system. The ACA permits states to adopt this approach, by applying for a waiver if all residents are provided with access to high quality, affordable health insurance while retaining the basic protections of the ACA.

A single-payer system would satisfy all these requirements and cover everyone. It would be cost effective and protect government from the ever-increasing expense of our disintegrating financing system. An expanded improved Medicare for All would eliminate deductibles and allow patients to go to any hospital or doctor. I would like to provide integrated care that is available to everyone without financial barriers. A single-payer system is the only way to achieve this goal. To establish this system for Massachusetts contact your legislators and ask them to support: “An act establishing improved Medicare for All in Massachusetts” SD698, HD 3249.

Dr. Michael Kaplan is a family physician.

http://www.berkshireeagle.com…

Cutting the underfunded Medicaid program

How Would Republican Plans for Medicaid Block Grants Actually Work?

By Aaron E. Carroll
The New York Times, February 6, 2017

There are only so many ways to cut Medicaid spending.

You can reduce the number of people covered. You can reduce the benefit coverage. You can also pay less for those benefits and get doctors and hospitals to accept less in reimbursement. Or you can ask beneficiaries to pay more.

None of those are attractive options, which is why Medicaid reform is so hard. Medicaid already reimburses providers at lower rates than other insurance programs. How do you reduce the number of beneficiaries when the vast majority of people covered are poor children, poor pregnant women, the disabled, and poor older people? Which of those would you cut?

Reducing benefit coverage has always been difficult because most of the spending has been on the disabled and poor older people, who need a lot of care. Beneficiaries don’t have much disposable income, so asking them to pick up more of the bill is almost impossible.

That doesn’t mean that states haven’t tried. As I’ve discussed in past columns, a number are attempting to increase cost sharing. But this isn’t really a solution because it doesn’t change overall spending much at all.

The fiscal magic behind a block-grants approach is that the federal government can then set how quickly the amount they’re responsible for will increase over time, regardless of how quickly medical spending grows. If a gap develops between how much a state needs to spend, and how much the block grant provides, it’s up to the state to make up the difference.

A recent New England Journal of Medicine article provides some perspective on how this might work by looking at what happened before Medicaid was created in 1965. Care for the poor in the 1950s was done through direct reimbursements to providers. It was calculated on a per-capita basis — the average cash and medical needs of those the programs covered. Those amounts were capped, based on age and demographics. This is quite similar to how many Republican proposals might function.

When these capped amounts weren’t enough to pay for the programs, states had to make cuts. They began to restrict who would be covered, what would be covered and how much care beneficiaries could use. Some states refused to cover children at all. Others didn’t cover doctors’ visits or drugs.

There’s no magic in how Congress reduces spending under a block grant mechanism. It just says it will do so, and leaves the hard decisions to others.

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NYT Reader Comment:

By Don McCanne,  M.D.
San Juan Capistrano, CA

Why should Medicaid be a separate program for low-income individuals? Or Medicare for the elderly and those with long-term disabilities? Or a multitude of private plans based merely on employment status? Or, as the Affordable Care Act attempted to address, having to turn to the highly dysfunctional individual insurance market by default?

The most popular of these alternatives is Medicare. Why don’t we simply improve Medicare and then provide it for everyone? As a welfare program representing individuals with a weak political voice, Medicaid is vulnerable to budget hawks. If we had one program representing all of us, politicians would be motivated to protect the program rather than hacking it with a blunt cleaver.

https://www.nytimes.com…

No Backward Steps in Health Care – Forward to Single Payer

By Kay Tillow
Daily Kos, Feb. 4, 2017

Life expectancy in the United States just went down. We were already several years behind other advanced countries. People in Italy live four years longer. Life expectancy is one of the fundamental ways to measure the health of a nation.

We are not doing well at taking care of our people. This decline is after the implementation of the Affordable Care Act (ACA) and prior to the assault on the ACA, Medicaid, and Medicare planned by the new Congress for 2017.

Maintenance of a failing status quo in health care does not inspire a winning movement. We must say no backward steps as we battle to place the real solution on the nation’s agenda. That solution is national single payer health care set forth in real legislation, HR 676, an Expanded and Improved Medicare for All. HR 676 will remove the insurance industry from control of our care and publicly fund all medically necessary care—for all of us—no exceptions—everybody in, nobody out.

In Kentucky, 440,000 gained coverage under the ACA Medicaid expansion. Governor Bevin has asked the federal government for a Medicaid waiver like that of Indiana that would force monthly premiums on those who have the least and kick them off if they fail to pay. The architect of Indiana’s Medicaid waiver, Seema Verma, has now been named by President Trump to head the Commission on Medicare and Medicaid Services.

Verma, and Tom Price, Trump’s appointee to Health and Human Services, are likely to give Bevin the waiver he seeks. Bevin says if he doesn’t get the waiver he will abolish the expansion program totally, ending health care for the 440,000 who just gained it.

Medicare, too, is on the chopping block, with Speaker Paul Ryan seeking to turn our best program, our example that single payer works, into vouchers.

But fighting for the status quo won’t save it. We have to project a bolder, braver plan to expand it to all. Already Medicare is 30% privatized, with changes supported by both Democrats and Republicans. Medicare’s new means testing and changes in payment to physicians are undermining our nation’s most beloved program. We are losing it little by little, as Grover Norquist gleefully reported.

The drug part of Medicare is a nightmare for seniors and a gold mine for pharmaceutical companies. The Part D drug plan is not a New Deal Social Security type plan. It is a market-based plan with outrageous profits placing the new life-saving drugs beyond the reach of many. We can now cure Hepatitis C with a drug called Solvadi. It costs $84,000 for the cure. Many insurers have said it will not be available or not covered until the patient goes into liver failure. The drug costs $300 in India.

HR 676 would bring drug companies to heel with monopsony buying power.

The ACA was designed to leave in place our employer-based health care system. Now even that coverage is rapidly deteriorating. The average plan has a deductible over $1,000 accompanied by drastic limitations on what doctor patients can see and what hospitals they can use. For millions the deductibles and co-pays place care beyond their means.

In the industrial heartland, the coal and rust belt, employers have dropped retiree coverage and shirked their responsibilities by mergers, lockouts, forced concession bargaining, and bankruptcies. The once secure industrial workers whose strong unions lifted the entire nation’s standards for health care are now battling to hang onto any care at all.

“We are sick of a criminal system based on profit that leaves people hanging without the health care they deserve,” said Mark Dimondstein, President of the 200,000 member American Postal Workers Union at a recent protest at Big Pharma.

The Affordable Care Act essentials were crafted by the Heritage Foundation, a conservative think tank, implemented by Mitt Romney in Massachusetts and promoted as the alternative to the single payer and national health service systems that have brought universal care to the rest of the industrialized world. The ACA was designed to serve the insurance industry rather than patients. It has brought coverage to 20 million who did not have insurance before, but the remaining 28 million with no coverage will not have it even if the ACA were to be fully implemented.

We can best avoid a backward slide by fighting for improvement of Medicare and expanding it to all.

People will not fight for a shriveled up dream. Only an inspiring, bold, and beautiful plan to cover all can galvanize a movement to power the rusted wheels of democracy and bring the humane care worthy of this great nation.

Some say that’s not feasible. On the contrary, it’s the only plan that is feasible. It’s the only plan that can expand care while reining in the costs.

Power concedes nothing without a demand. Frederick Douglass did not counsel us to reduce our demands when we face opposition. He remained steadfast in his demand working to spark the fight to do what’s right.

Our wealthy country is capable of providing great care for all of us. A free people does not allow insurance corporations to dictate, deny care, and control elected officials. They stand up to change it.

Kay Tillow is coordinator, All Unions Committee for Single Payer Health Care—HR 676.

http://www.dailykos.com…

Payment sources and patient racial mix at academic medical centers

Hospital Payer and Racial/Ethnic Mix at Private Academic Medical Centers in Boston and New York City

By Roosa Sofia Tikkanen, Steffie Woolhandler, David U. Himmelstein, Nancy R. Kressin, Amresh Hanchate, Meng-Yun Lin, Danny McCormick, Karen E. Lasser
International Journal of Health Services, February 2, 2017

Abstract

Academic medical centers (AMCs) are widely perceived as providing the highest-quality medical care. To investigate disparities in access to such care, we studied the racial/ethnic and payer mixes at private AMCs of New York City (NYC) and Boston, two cities where these prestigious institutions play a dominant role in the health care system. We used individual-level inpatient discharge data for acute care hospitals to examine the degree of hospital racial/ethnic and insurance segregation in both cities using the Index of Dissimilarity, together with recent changes in patterns of care in NYC. In multivariable logistic regression analyses, black patients in NYC were two to three times less likely than whites, and uninsured patients approximately five times less likely than privately insured patients, to be discharged from AMCs. In Boston, minorities were overrepresented at AMCs relative to other hospitals. NYC hospitals were more segregated overall according to race/ethnicity and insurance than Boston hospitals, and insurance segregation became more pronounced in NYC after the Affordable Care Act. Although health reform improved access to insurance, access to AMCs remains limited for disadvantaged populations, which may undermine the quality of care available to these groups.

From the Introduction

Academic medical centers (AMCs) play a unique role in the U.S. health care system. These institutions, which typically comprise a medical school and a closely affiliated teaching hospital, train health professionals, conduct research, and provide patient care. AMCs are often among the largest hospitals in their service areas: despite representing only 5% of the nation’s hospitals, combined, they account for one-fifth of the total hospital volume in the United States. AMCs typically serve a medically complex patient population and provide specialized expertise across a range of clinical areas. Many AMCs are ranked among the top hospitals in the country, and patients treated at AMCs are more likely than other patients to receive treatments using the latest technologies and care adhering to current clinical guidelines.

For these reasons, AMCs are often recognizable brands and attract referrals from nearby counties, states, and, increasingly, from other countries as well. At the same time, many AMCs are key safety-net providers in their communities and have historically provided approximately one-third of all charity care and one-quarter of all Medicaid hospitalizations. Yet, recent reports raise concern that uninsured and Medicaid patients face barriers to obtaining care at AMCs.

Racial and ethnic minorities, who are more frequently uninsured or covered by Medicaid than other Americans, often encounter access barriers. Unequal access to high-quality health facilities, including AMCs, is recognized as a contributor to racial and ethnic health disparities.

From the Discussion

Our analyses of adult hospital discharges indicate that minority, uninsured, and Medicaid patients are strikingly underrepresented at NYC’s private AMCs. This pattern has not improved and – regarding insurance status — became even more pronounced after the passage of the ACA. In contrast, care was less segregated according to both race/ethnicity and insurance in Boston. Indeed, minorities were slightly overrepresented, although Medicaid and uninsured patients were underrepresented, at Boston’s AMCs.

What explains the greater racial/ethnic and payer segregation in NYC’s AMCs relatives to Boston’s? First, the extensive network of public hospitals in NYC relieves pressure on that city’s private AMCs to care for disadvantaged patients, allowing AMCs there to focus on serving as referral centers for privately insured patients living in predominantly white, suburban communities. In contrast, only one relatively small public hospital remains in the Boston area. Second, AMCs in Boston may be less resistant to integrating the comparatively small number of minority and uninsured patients in that city. Finally, Boston Medical Center, a private AMC that incorporates a previously public hospital, continues to serve many poor and black patients.

The case for desegregation is morally and medically compelling. Disparities in access to high-performing health facilities contribute to racial/ethnic disparities in both quality of care and health outcomes. Ensuring equal access to health facilities is a stated policy priority of both federal and NYC authorities.

http://journals.sagepub.com…

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Comment:

By Don McCanne, M.D.

Academic medical centers (AMCs), with their great resources and advanced technologies, are ideal to provide specialized care for certain patients with complex medical needs. A high performance health care system should provide equitable access for those who would most benefit from the services offered by AMCs. This study indicates that race and insurance status may contribute to inequities and disparities in access to these facilities.

There are many contributing factors, some of which are discussed in the article. It is clear that one significant factor is the fragmentation in the financing of health care – both in funding of the health care delivery infrastructure and in the various forms of public and private insurance coverage or lack thereof.

Patients are treated differently based on whether they are uninsured, or if they are on Medicaid with its low reimbursement rates, or on the basis of the richness or sparseness of the benefits offered by their private plans, or on the makeup of the provider networks established by their insurers.

A single payer national health program, including separate allocation of resources for health care delivery infrastructure, would dramatically reduce the role of financing factors that result in these inequities.

Once we have an equitable financing system, other racial factors must still be addressed. As study co-author David Himmelstein states, “Stark racial segregation persists to this day in New York’s hospitals. Our most prestigious institutions find ways to avoid Black and poor patients. And they maintain separate and unequal clinic systems. Privately insured patients get business-class care; those with Medicaid are mostly treated by interns and residents in rundown facilities and face long waits for appointments; while the uninsured are usually turned away from the elite hospitals’ clinics altogether.”

Clearly, once we have an improved Medicare for all in place, our work is not done.

Looking for a really good Obamacare replacement? Here it is

By David Lazarus
Los Angeles Times, Feb. 3, 2017

Supporters of healthcare reform may feel disheartened as President Trump and Republican lawmakers prepare to repeal the Affordable Care Act and replace it with … well, something. They can’t even agree among themselves on what the U.S. healthcare system should look like.

But there’s reason for hope, albeit a long shot.

OK, a very long shot.

Rep. John Conyers Jr. (D-Mich.) has introduced a bill that would expand Medicare to “provide for comprehensive health insurance coverage for all United States residents.”

In other words, it would build on the successful single-payer insurance program that already covers more than 55 million people and bring the United States in line with almost all other developed nations in providing taxpayer-funded health coverage for everyone.

Needless to say, the legislation — HR 676 — has no chance of passage by the Republican-controlled Congress.

However, the fact that such a bill exists serves as a reminder that there are some in positions of power who understand the pitfalls of the U.S.’s private-sector-dominated health insurance system, and who are willing to place national interest ahead of corporate profits.

Also, some backers of the legislation think there’s at least one prominent Republican who might come around to their way of thinking.

Taking 20 million people out of Obamacare is going to help our cause. We’ve got all the arguments on our side. — Rep. John Conyers Jr. (D-Mich.)

“Donald Trump is a businessman, not a lifetime politician,” said Dr. Carol Paris, head of Physicians for a National Health Program, which represents 20,000 doctors who support creation of a U.S. single-payer insurance system. “HR 676 is a formula for good business. It makes good business sense.”

She’ll get no argument from me. A 2014 study by the Commonwealth Fund compared the U.S. healthcare system to those of 10 other developed countries, including Canada, Germany, France and Britain.

It found that the United States had by far the most expensive system in the world but trailed its peers in delivering bang for its healthcare bucks.

Administrative costs — paperwork, incompatible computer systems, interactions between doctors, hospitals and hundreds of insurers — eat up about 25% of U.S. healthcare spending.

Meanwhile, at an average of more than $10,000 per person, the United States pays more for healthcare annually than any other developed country without any significant improvement in outcome, such as longer life expectancy. The typical American can expect to live to 79, whereas citizens of other developed nations will live past 80, according to the Organization for Economic Cooperation and Development.

“International experience shows that single-payer financing systems, like the one described in Rep. Conyers’ bill, are the fairest and most cost-effective way to assure that everyone gets high-quality care,” Paris said.

Conyers, however, isn’t holding his breath.

He told me he doesn’t think Trump — whom he described as “erratic” — will suddenly embrace the common-sense advantages of Medicare for all. Nor does he think House Republicans will be flexible in their thinking.

“This is not something that they’re going to buy into,” Conyers said, “even though countries with universal healthcare find that it costs less and is healthier for people. We’re just too polarized right now.”

Nevertheless, he said he’s optimistic about the future. Conyers expects the Republicans’ replacement of Obamacare to be so troublesome that the public will grow increasingly receptive to new ideas. This will allow a case to be made for Medicare expansion.

“Taking 20 million people out of Obamacare is going to help our cause,” he said. “We’ve got all the arguments on our side.”

His bill already has 51 co-sponsors, including California’s Judy Chu, Mark DeSaulnier, John Garamendi, Jared Huffman, Barbara Lee, Ted Lieu, Zoe Lofgren, Grace Napolitano, Lucille Roybal-Allard and Mark Takano. No Republicans have signed on.

Under HR 676, “all individuals residing in the United States (including any territory of the United States) are covered under the Medicare For All Program, entitling them to a universal, best quality standard of care.”

The bill would cover primary care, emergency care, prescription drugs, medical equipment, long-term care, mental health services, dental services, chiropractic services, basic vision care and other healthcare needs.

And try this on for size: “No deductibles, copayments, coinsurance or other cost-sharing shall be imposed with respect to covered benefits.” Instead, funding would be made primarily through payroll taxes, as is already the case with Medicare and Social Security.

A 2013 analysis of an earlier version of Conyers’ legislation by Gerald Friedman, a healthcare economist at the University of Massachusetts Amherst, found that progressive federal tax payments “would cost less for 95% of households” than the current system of deductibles, premiums and copayments.

He also concluded that because of huge administrative savings and greater negotiating strength with hospitals, doctors and drug companies, a Medicare-for-all system “would make it possible to provide universal coverage and comprehensive benefits to future generations.”

This isn’t “socialism” and it isn’t “government-run healthcare.” Doctors would still be free to practice medicine as they see fit.

It’s simply a more effective and efficient way of managing healthcare risk for the entire population.

Private health insurers would battle ferociously to prevent such a change, but they wouldn’t be put out of business. Rather than providing total coverage, they’d simply shift to offering supplemental plans, as they already do. A more competitive market for added coverage would only benefit Americans.

It’s widely believed that Republican replacements for the Affordable Care Act will include health savings accounts coupled with high-deductible plans from private insurers, as well as high-risk pools for people with pre-existing conditions that all but guarantee limited coverage and sky-high premiums.

Think about that. Now think about the broad coverage featured in Conyers’ bill being available for less than what you pay now.

Think about having the same coverage regardless of your job (or lack thereof). Think about the number of people without insurance dropping to zero.

Think about Americans finally enjoying the same healthcare benefits as the rest of the developed world.

What’s not to like?

http://www.latimes.com…

The post-ACA insurance market is working better for consumers, but how much better?

New Health Insurance Survey: Post-ACA, Market Works Better For Consumers Buying Plans On Their Own; Fewer People Postponing Care and Medications Because of Cost

The Commonwealth Fund, February 1, 2017

The health insurance market has been working better for consumers buying coverage on their own, especially those with health problems, since the Affordable Care Act (ACA) took effect. According to a new Commonwealth Fund report, the percentage of people who shopped for insurance on their own who could not find an affordable plan dropped from 60 percent in 2010 to 34 percent in 2016.

“Before the Affordable Care Act, it was often extremely hard for people not covered through an employer to buy coverage,” said Sara Collins, vice president for Health Care Coverage and Access at the Commonwealth Fund and the report’s lead author. “Many were routinely turned down, told a preexisting condition would not be covered, or charged higher rates because of an illness. This survey finds that since the law was passed the individual market has changed dramatically. Now, millions of people are finding and buying affordable plans that provide coverage meeting their needs.”

The survey finds that since the ACA’s passage in 2010, people are more likely to say they can get the health insurance and care they need:

* In 2012, 80 million adults said they went without health care or medication they needed because of the cost, compared to 63 million in 2016.

* In 2010, more than two of five (43%) adults buying plans on their own said they found it difficult or impossible to find a plan that fit their needs, compared to one-quarter (25%) in 2016.

* In 2010, more than half (53%) of adults with health problems said it was difficult or impossible to find a plan that fit their needs; this fell to one-third (31%) in 2016. For people with low incomes, the share reporting such difficulty fell by about half, from 49 percent in 2010 to 26 percent in 2016.

* In 2012, 29 percent said they did not go to a doctor when they were sick because of the cost, compared to 20 percent in 2016. In 2012 over one-quarter of adults (27%) said they did not fill a prescription because of the cost, compared to one-fifth (19%) in 2016.

* In 2016, the share of adults reporting they had skipped a recommended test, treatment, or follow-up visit because of the cost fell to 18 percent, from 27 percent in 2012. And in 2016, 13 percent said they had not gotten needed care from a specialist because of the cost, down from 20 percent in 2012.

* Medical bills remain a challenge. The number of adults saying they had problems paying medical bills in the past 12 months or were paying off medical bills over time declined modestly, from 75 million is 2012 to 70 million in 2016. There are still a substantial number of people paying off medical debt over time; nearly 46 million adults reporting doing so in 2016—unchanged from 2012.

http://www.commonwealthfund.org…

Full report:
http://www.commonwealthfund.org…

***

Comment:

By Don McCanne, M.D.

It is really wonderful to see the progress that we have made with the Affordable Care Act in ensuring affordable health care for all. To understand better how far we have come, let’s select from this report the findings of where we stand today:

* Only 63 million adults say they went without health care or medication they needed because of the cost

* Only 25 percent of adults buying plans on their own say they found it difficult or impossible to find a plan that fit their needs

* Only 31 percent of adults with health problems say it was difficult or impossible to find a plan that fits their needs

* Only 26 percent of adults with low incomes and health problems say it was difficult or impossible to find a plan that fits their needs

* Only 20 percent of adults say they did not go to a doctor when they were sick because of the cost

* Only 19 percent of adults say they did not fill a prescription because of the cost

* Only 18 percent of adults reported they had skipped a recommended test, treatment, or follow-up visit because of the cost

* Only 70 million adults said they had problems paying medical bills in the past 12 months or were paying off medical bills over time

* Only 46 million adults are currently paying off medical debt over time (unchanged from 2012)

Is this really good enough? Should we vigorously defend the status quo supported by the Democrats? Or should we support Republican policies that would replace the Affordable Care Act – policies that would shift more costs to patients, inevitably increasing the exposure of adults to these difficulties they now face? These are the options currently under debate in Congress.

There is another option. We can reduce all of those numbers to ZERO simply by enacting and implementing a well designed single payer national health program – an improved Medicare for all. And it wouldn’t cost the nation any more than we are already spending. Congress and the President need to hear from us.

Trumping Obamacare with Medicare-For-All

By Paul F. deLespinasse
Statesman Journal (Salem, Ore.), Feb. 2, 2017

Donald Trump promises to “repeal and replace” Obamacare and has said that replacement and repeal should be simultaneous. Let’s hope he insists on simultaneity. Repeal would be delayed since there is no Republican consensus on a replacement. But delay is preferable to the mess caused by a mere repeal.

Obamacare  insured millions of additional people. And some parts are very popular, especially its ban on denying insurance to people with preexisting conditions. But insurance markets would be destroyed if this ban is retained but the most unpopular part of Obamacare (mandatory purchase of insurance) is not also retained.

The obvious way to escape from this dilemma is to enact a single-payer system — an improved Medicare-For-All — financed by general taxes. Nobody would have to buy insurance, but everyone would be insured. People would not have to choose between incomprehensible policies with different coverage and doctor “networks.” Patients would no longer “churn” between different types of insurance, each with its own network, as incomes change. People would no longer have to document their finances in order to qualify for subsidies.

Medical providers would no longer need huge staffs — now costing about $80,000 per year for every doctor — to bill dozens of insurance companies.

Conservatives bemoan duplicated government programs and administrative bloat. But we now have separate government agencies for insuring poor people, retirees, veterans and Native Americans. We also have private bloat: back-room staffing at medical providers and huge staffs that insurance companies use to figure out reasons for not covering people.

This presents an opportunity for Donald Trump (a world-class opportunist). Imagine him explaining to his supporters (often not economically advantaged) why a system covering medical bills with only nominal co-payments, no deductibles and no out-of-network doctors would be strongly in their interest. Or explaining to black Americans how an improved Medicare-For-All would do more for minorities than any other conceivable government program.

If Trump were to propose Medicare-For-All, Democrats in Congress would support him, and so would many of the voters who supported him.

Medicare-For-All would not require establishment of a new bureaucracy since Medicare is already a going concern. Indeed, it would allow elimination of the organizations now covering the poor, veterans and Native Americans.

Trump, knowing how to get national attention, will be uniquely able to explain why inevitable criticism of his proposal by the medical/pharmaceutical insurance complex is self-interested and misleading. He can explain why taxes necessary to pay for Medicare-For-All will cost average (and especially below-average) Americans less than they are already paying (directly and indirectly) for medical care.

Although most congressional Republicans have opposed single-payer, if Trump convinces public opinion, many Republican congressmen would have to vote for it. If single-payer failed to pass, Trump could urge voters to unseat those who opposed it in 2018.

It took red-baiter Richard Nixon to restore U.S. relations with China. Can a Republican president bring us Medicare-For-All?

Paul F. deLespinasse of Corvallis is professor emeritus of political science and computer science at Adrian College. He can be reached at pdeles@proaxis.com.

http://www.statesmanjournal.com…

‘The Single-Payer Healthcare Fight Goes National … Again’

By Lynn Marie Morski, M.D.
IVN (Independent Voter Project), Feb. 2, 2017

One of the more notable tenets of Bernie Sanders’ platform during his campaign for president was a “Medicare-for-all” single-payer healthcare system.

This was not the first time that a government-run, public option has received national attention. Many may recall that the initial versions of the Affordable Care Act had included a public option, but it was voted down in the Senate finance committee and removed from the bill.

In 2013, House Democrats introduced H.R. 261, the “Public Option Deficit Reduction Act.” The act would have amended the Affordable Care Act to add a public option. It would have lowered premiums by 5-7%, which they hoped would put pressure on private insurance companies to lower premiums. The Congressional Budget Office had estimated enacting the bill would cut the budget deficit by $104 billion over ten years. It didn’t make it out of the Subcommittee on Health.

Since that time, it appears that Americans have had varied opinions on single-payer or “Medicare-for-all” systems. Many don’t understand the concept fully, and others are turned off by the thought of paying more taxes or losing their current insurance. Often, the facts that additional taxes may be offset by lower costs for medical visits and a single-payer system would involve much lower administrative costs go unnoticed.

But despite the fact that neither H.R. 261, nor Bernie Sanders’ Medicare-for-all system came to fruition, it appears that the desire for a single-payer system persists. On January 24th, Congressman John Conyers (D-MI-13) reintroduced HR 676, a bill aimed at expanding Medicare to provide universal coverage for all Americans, a bill he had initially introduced in 2003 and reintroduced in 2009, 2011 and 2013. The bill currently has 51 cosponsors.

Healthcare-NOW, an organization that advocates for a single-payer system, gave a detailed rundown of the bill’s highlights on their website, but most notably it would cover every American citizen, and the new national healthcare service would negotiate prices with physicians, hospitals, and pharmaceutical and medical supply companies. They estimate the savings to the United States at $387 billion dollars annually.

So while a number of states have had their own failed initiatives for statewide single payer systems, proponents of universal healthcare can be encouraged by the fact that there are a number of members of Congress who still think single-payer is an option worth fighting for at a national level.

Lynn Marie Morski is a physician at the Veterans Administration and an adjunct professor of health law at Thomas Jefferson School of Law.

https://ivn.us…

Hospitals in New York City segregated by race and insurance status: new study

Black and low-income New Yorkers largely shut out of major academic hospitals

New study finds substantial segregation in New York’s hospital system, but less in Boston’s

FOR IMMEDIATE RELEASE, Friday, February 3, 2017
Contact: Mark Almberg, PNHP communications director, 312-782-6006, mark@pnhp.org

Few Black New Yorkers receive care in New York City’s elite private academic medical centers (AMCs), according to a study published Thursday [Feb. 2, at 11:30 p.m. EST] in the International Journal of Health Services. Uninsured and Medicaid patients are also markedly underrepresented at the city’s major academic hospitals. In contrast, patients in Boston’s hospitals are much less segregated by race or health insurance status.

The study analyzed official data on all adults discharged from hospitals in New York City (NYC) in 2009 and 2014, and in Boston in 2009. It found that in NYC in 2014, Blacks accounted for only 18 percent of AMC patients, but nearly one-third of patients in the city’s other hospitals. (Findings were similar in 2009). Similarly, only 22 percent of New York City’s AMC patients had Medicaid and only 1 percent were uninsured, versus corresponding figures of 42 percent and 4 percent at city’s non-AMC hospitals.

The study was carried out by researchers at City University of New York at Hunter College (CUNY), Boston Medical Center, and Harvard Medical School. Four of the authors are academic physicians who have cared for patients at multiple hospitals included in the study.

Other study findings include the following:

  • Even after controlling for their lower-quality insurance, Black New Yorkers were still only half as likely as whites to get their care in AMCs.
  • The Index of Dissimilarity (a measure of system-wide segregation) for Black patients was 0.52 for NYC hospitals, indicating moderately high segregation. That figure means that 52 percent of Black patients in NYC would have to switch to hospitals that now serve predominantly white patients to achieve the full integration of the system. In Boston’s system, the Index of Dissimilarity figure was 0.33.
  • Compared to privately insured patients, Medicaid patients were three times less likely, and uninsured patients five times less likely, to be treated at New York City’s major academic hospitals. While Medicaid and uninsured patients accounted for nearly half (46 percent) of all patients at non-AMC hospitals in NYC, they made up less than one-quarter of inpatients at NYC’s AMCs overall, and less than 10 percent at one-third of the AMCs.
  • Conversely, privately insured New Yorkers were more than twice as likely to get care at AMCs compared to other NYC hospitals. In Boston, Medicaid enrollees and uninsured patients were just as likely to be treated at an AMC as at a non-AMC hospital (14 percent and 1 percent for both).

The authors state: “Academic medical centers play a unique role. … They provide specialized expertise across a range of clinical services. Many AMCs are ranked among the top hospitals in the country, and patients treated at AMCs are more likely than other patients to receive treatments using the latest technologies and care adhering to current clinical guidelines.”

They note that while good non-AMC hospitals can provide excellent care for many illnesses, the specialized care available at AMCs is especially important for patients with very complex and rare conditions.

The authors posit that “the extensive network of public hospitals in NYC relieves pressure on that city’s AMCs to care for disadvantaged patients.” But they note that the public hospitals face a financial crisis and are often under-resourced, while several of the AMCs regularly generate multimillion-dollar surpluses on their balance sheets.

All of the AMCs in Boston and NYC are nonprofit hospitals and enjoy tax exemptions worth tens of millions of dollars. In exchange, they are expected to provide community benefits, including caring for Medicaid and uninsured patients.

Roosa Tikkanen, lead author of the study who is currently a policy analyst at the University of Massachusetts Medical School, said: “All of New York’s academic medical centers receive millions of dollars from the state’s ‘Indigent Care Pool,’ but many of them provide little care to uninsured or Medicaid patients. Some of them are specialty hospitals that receive their patients mainly through referrals from private doctors, and these patients tend to be privately insured. This contributes to the low volume of Medicaid and uninsured patients at AMCs. However, even these specialty hospitals could do more to meet their community benefit expectation and earn their tax breaks, especially since they already have greater financial resources than the city’s public hospitals do.”

Study co-author Dr. David Himmelstein, an internist, distinguished professor at CUNY’s Hunter College, and lecturer at Harvard Medical School who has practiced at public and AMC hospitals in New York and Boston, said: “Stark racial segregation persists to this day in New York’s hospitals. Our most prestigious institutions find ways to avoid Black and poor patients. And they maintain separate and unequal clinic systems. Privately insured patients get business-class care; those with Medicaid are mostly treated by interns and residents in rundown facilities and face long waits for appointments; while the uninsured are usually turned away from the elite hospitals’ clinics altogether.”

Senior author Dr. Karen E. Lasser, an internist at Boston Medical Center and associate professor of medicine and public health at Boston University Schools of Medicine (BUSM) and Public Health (BUSPH), said, “This study highlights the issues that academic health centers need to address in order to provide the highest level of care to all patients, regardless of race, ethnicity, or health insurance coverage.”

***

“Hospital payer and racial/ethnic mix at private academic medical centers in Boston and New York City,” Roosa Sofia Tikkanen, M.P.H., M.Res., Steffie Woolhandler, M.D., M.P.H., David U. Himmelstein, M.D., Nancy R. Kressin, Ph.D., Amresh Hanchate, Ph.D., Meng-Yun Lin, M.P.H., Danny McCormick, M.D., M.P.H., Karen E. Lasser, M.D., M.P.H. International Journal of Health Services, published Online First, Feb. 2, 2017, at 11:30 p.m. EST. doi: 10.1177/0020731416689549.

A copy of the full study is available to media professionals upon request from Mark Almberg at mark@pnhp.org  or 312-782-6006.

Disclosures: This research project was supported in part by grants from the New York City Department of Health and Mental Hygiene; the Rx Foundation; National Institutes of Health/National Heart, Lung, and Blood Institute (U01HL105432); and the Margaret Mahoney Fellowship at the New York Academy of Medicine. The study does not necessarily reflect the views of those grantors, nor Harvard Medical School, nor Boston Medical Center, which provided administrative support. Two of the authors, Himmelstein and Woolhandler, co-founded Physicians for a National Health Program (www.pnhp.org), a nonprofit physicians organization that supports a single-payer national health plan. PNHP had no role in funding or otherwise supporting the study.

Covered California works really well, except for all the headaches

Headaches Persist As Covered California Enrollment Nears End

California Healthline, January 31, 2017

Covered California’s fourth annual open enrollment period, set to end Tuesday, has been rocky for many consumers.

During this period, two Covered California errors have affected roughly 50,000 policy holders, leading to higher-than-expected premiums or the potential loss of their tax credits:

  • Covered California discovered late last year that about 24,000 policy holders hadn’t provided consent for the agency to verify their income, even though the agency thought they had. Without that consent, thousands of consumers lost their 2017 tax credits, at least temporarily.
  • Covered California gave insurers the wrong tax credit information for about 25,000 policy holders, resulting in inaccurate bills. In most cases the recalculated premiums are higher than consumers had initially anticipated.

Those mistakes are in addition to ongoing challenges, including Covered California website glitches, complicated password resets and the often-fraught interaction between Covered California and Medi-Cal, the state’s health coverage program for low-income residents.

Covered California Executive Director Peter Lee said the agency is contacting enrollees to fix the problems. “No one’s perfect. Anything of the scale we’re doing is going to have some problems along the way,” he said at the agency’s most recent board meeting.

Emily Bazar, California Healthline columnist and senior correspondent, recently appeared on the “McIntyre in the Morning” show on KABC AM 790 in Los Angeles to discuss these problems and their effect on consumers.

***

“McIntyre in the Morning” show on KABC AM 790

Doug McIntyre:  This story is so complicated, and I have a BA in English. I still don’t feel really competent of the facts on this so please be kind with me as we go through this because it’s complicated; it’s really complicated.

Emily Bazar:  You’re right. It’s incredibly complicated. It’s been very difficult for people since 2013, 2014 when this began – to figure out how to apply, how to use their insurance, what the requirements are to avoid the tax penalties – it’s been very complicated.

…

Emily Bazar:  It seems in the writing of these things that the day to day effect on people  – the effect that it has on their lives, their time, their pocketbooks – is not taken into account as much as it should be.

http://californiahealthline.org…

***

Comment:

By Don McCanne, M.D.

Peter Lee and his staff at Covered California quite appropriately have received accolades for their great work in implementing the Affordable Care Act. It has not been without glitches, such as those in this article, but that should only be expected in a system with such great complexity. As Emily Bazar states, “It’s incredibly complicated.”

But wouldn’t an improved Medicare that covered everyone because of its massive size also be incredibly complicated? Actually not necessarily. A well designed single payer national health program is the epitome of simplicity in the financing of a health care system. The administrative complexity that uniquely characterizes our fragmented multi-payer system would be eliminated by the administrative simplicity of a single payer system. Improving Medicare includes revising administrative functions to operate smoothly within a single system as opposed to being only one player that cannot introduce efficiency into the infrastructure of our complex multi-payer system.

The large size – covering 324 million people – is not a reason to duck out of implementing a universal program. Rather our financing system screams out for simplicity and efficiency – precisely why we need to enact and implement an improved Medicare for all.

Size is not the problem. Design is. Emily Bazar says that we need to take into account “the day to day effect on people  – the effect that it has on their lives, their time, their pocketbooks.”