Insurers Say Costs Are Climbing as More Enroll Past Health Act Deadline

By Robert Pear
The New York Times, January 9, 2016

Eager to maximize coverage under the Affordable Care Act, the Obama administration has allowed large numbers of people to sign up for insurance after the deadlines in the last two years, destabilizing insurance markets and driving up premiums, health insurance companies say.

The administration has created more than 30 “special enrollment” categories and sent emails to millions of Americans last year urging them to see if they might be able to sign up after the annual open enrollment deadline. But, insurers and state officials said, the federal government did little to verify whether late arrivals were eligible.

That has allowed people to wait until they become ill or need medical services to sign up, driving up costs broadly, insurers have told federal health officials.

“Individuals enrolled through special enrollment periods are utilizing up to 55 percent more services than their open enrollment counterparts” who sign up in the regular period, the Blue Cross and Blue Shield Association, whose local member companies operate in every state, told the administration.

“Many individuals have no incentive to enroll in coverage during open enrollment, but can wait until they are sick or need services before enrolling and drop coverage immediately after receiving services, making the annual open enrollment period meaningless,” Steven B. Kelmar, an executive vice president of Aetna, said in a letter to Sylvia Mathews Burwell, the secretary of health and human services.

A quarter of the applications that Aetna received in the health law’s public insurance marketplace last year came through special enrollment periods, he said.

Kevin J. Counihan, the chief executive of the federal insurance marketplace, said nearly 950,000 people used special enrollment periods to get coverage through HealthCare.gov from late February to the end of June 2015.

“On average,” Aetna said, “special enrollment period enrollees stay with us for less than four months, while enrollees who come to us during the annual open enrollment period maintain their coverage on average for eight to nine months.”

Daniel J. Schumacher, the chief financial officer of UnitedHealthcare, the insurance unit of UnitedHealth Group, said more than 20 percent of its marketplace customers signed up after open enrollment ended last year. And they used 20 percent more health care than people who signed up before the deadline, he said.

Such concerns could portend higher insurance rates broadly. In setting current premiums, insurers say, they did not realize how many people would sign up after the deadline and how much care they would use. That information may affect future rates and benefits.

The federal government allows people to sign up or switch health plans outside open enrollment for various reasons. Lawyers said it was not easy to find a complete list of the eligibility criteria, which have been set forth in regulations, bulletins, official policy statements, manuals and informal “guidance documents.” Some of the reasons are straightforward, like getting married or having a baby.

Others are more complicated and less clear-cut. Consumers may, for example, be eligible for a special enrollment period in “exceptional circumstances” and in “other situations determined appropriate” by the Centers for Medicare and Medicaid Services. The circumstances may include “a serious medical condition” that kept a person from enrolling.

“Most consumers are confused by the rules on special enrollment periods and do not understand the system well enough to try to game it,” said Christine Speidel, a lawyer at Vermont Legal Aid. On the other hand, she said, “many people feel that insurance is not affordable, even with subsidies, and they will call the marketplace to see if they qualify for insurance when they get sick.”

http://www.nytimes.com/2016/01/10/us/politics/insurers-say-costs-are-climbing-as-more-enroll-past-health-act-deadline.html?ref=business&_r=0

Open enrollment periods for the ACA exchange health plans are limited in duration to prevent people from buying insurance only when a need arises, and then canceling the insurance after the need is met. This “adverse selection” would reduce premium revenues for the insurers while increasing expenditures for medical benefits. This drives up the cost of premiums for everyone else which can cause the healthy to bail out, driving premiums up even more and resulting in the “death spiral,” which is very disruptive to insurance markets.

Circumstances for individuals do change when enrollment is closed, thus the law allows special enrollment so that individuals don’t have to wait up to a year to gain coverage. The problem with special enrollment during closed enrollment periods is that it is the individuals with changing circumstances who also have pressing medical needs that will be compelled to enroll. Thus the payouts by the insurers will increase during these closed enrollment periods. Also, many healthy individuals who feel that they cannot afford their premiums will drop their coverage, decreasing revenue for the insurers. Increased expenditures and reduced revenues is not exactly the business model that insurers seek.

This creates a dilemma for the actuaries. To ensure solvency, premiums will have to be set higher than would be warranted based strictly on the better health of those enrolling during the open enrollment period. Higher premiums then threaten the insurers’ ability to gain market share. This is a problem for even the nation’s largest insurers, as we now see UnitedHealth is withdrawing from the exchanges for this very reason.

The Affordable Care Act perpetuates a market of private plans theoretically designed to use competition to improve quality while reducing costs. But because insurers are not allowed to exercise pure market forces since they must sell their products to people who will actually need to use them, the regulated market of private plans fails under these countervailing forces. Waste escalates because of the greater administrative burden of this defective market, and because of the need of the insurers to distort the functioning of their plans (e.g., higher deductibles and narrower networks) in an attempt to protect their bottom lines.

We can’t keep pretending that we will figure out a way to make private insurance markets work for everyone. We already have over half a century of failure. That’s enough. It’s time to enact a publicly-administered and publicly-financed single payer national health program – an improved Medicare for all.

Health Plan Watchdog Still Seeks Progress After 25 Years

By Phil Galewitz
Kaiser Health News, January 8, 2016

The nation’s oldest private arbiter of what defines high-quality health plans turned 25 last year. The National Committee for Quality Assurance (NCQA) started soon after HMOs became popular in the 1980s, measuring the effectiveness of the first managed care plans as millions of consumers flocked to join them.

Today, NCQA accredits health plans in every state, covering 109 million Americans or about 70 percent of all Americans enrolled in private coverage.

Founding and current president Margaret “Peggy” O’Kane discussed her organization’s past and future recently with KHN’s Phil Galewitz.

Phil Galewitz:  What do you see as NCQA’s biggest achievement after 25 years?

Margaret O’Kane:  Just getting the measurements out there in a systematic way. We are now finally at a stage where the delivery system is getting it and trying to reorganize itself with primary care medical homes and accountable care organizations.

Galewitz:  Is the United States doing a better job for consumers in measuring health plans’ quality of care?

O’Kane:  Maybe the glass is half full on measurement, or less than that. I think our strategy was to always walk behind the evidence. We have good measures where there is good evidence on preventive services and chronic diseases like hypertension and diabetes. What we are missing is often in areas where the science is unclear. These also tend to be high-stakes areas of care, like cancer or other complex illnesses.

Galewitz:  Are health plans receptive to being evaluated by NCQA?

O’Kane:  It’s less than voluntary, I would say. It’s in the health law for exchange plans (to be accredited by NCQA or another accrediting group) and has been driven by employers traditionally. Some plans really question whether it matters what (their) quality is. You see narrow networks emerging and if they are chosen just based on price, that isn’t going to go well among consumers.

Galewitz:  How much has NCQA’s work improved the quality of health care that Americans receive?

O’Kane:  In the areas we have measured, you can point to real improvements. My main gripe now is what I see as contradictory strategies of high deductibles versus a delivery system reform promoting primary care. If you have to spend out of your own pocket $2,000 or $5,000 before you get to see your primary care physician (for free), many Americans don’t have that money. We are reforming the delivery system and then people can’t afford to see their primary care doctor. That makes no sense.

http://khn.org/news/a-health-care-watchdog-for-consumers-turns-25/

***

Comment:

By Don McCanne, M.D.

As our health care system is being refined to supposedly replace quantity with quality in the delivery of health care services, we should learn from the experience of the National Committee for Quality Assurance (NCQA) – one of the more credible and experienced organizations attempting to improve quality in health care. Their founder and president, Margaret “Peggy” O’Kane, has a few lessons for us.

How are we doing on quality measurements? The glass is “half full… or less.” We are not doing well on “high-stakes areas of care, like cancer or other complex illnesses.” How can you ignore the quantity of care that is required for these complex cases and pretend that you are going to make payments based instead on quality that you can’t measure?

And the reception by the exchange health plans of the ACA requirement that they be accredited for quality? O’Kane says that the involvement of the plans is “less than voluntary.” She says, “Some plans really question whether it matters what (their) quality is.” Wow! Plans are setting up narrow networks that are based on price (while ignoring quality – DMc).

Her most important message: “My main gripe now is what I see as contradictory strategies of high deductibles versus a delivery system reform promoting primary care. If you have to spend out of your own pocket $2,000 or $5,000 before you get to see your primary care physician (for free), many Americans don’t have that money. We are reforming the delivery system and then people can’t afford to see their primary care doctor. That makes no sense.”

As the policy and political communities divert their efforts to structural reforms that have not been demonstrated to have more than a negligible impact on quality, the private insurance industry has moved forward with changes that are making health care unaffordable and inaccessible for far too many Americans. When what we need is a strong primary care infrastructure, our health care leaders are allowing the insurers to erect intolerable financial barriers to care. As O’Kane says, “That makes no sense.”

It’s great that we have dedicated organizations such as NCQA and AHRQ to help ferret out and correct quality problems. But we cannot let that distract us from what we really need to do: enact a well designed single payer national health program that will bring us the structural reforms that we desperately need, so all of us can have affordable, accessible, high quality health care.

Health Plan Watchdog Still Seeks Progress After 25 Years

By Phil Galewitz
Kaiser Health News, January 8, 2016

The nation’s oldest private arbiter of what defines high-quality health plans turned 25 last year. The National Committee for Quality Assurance (NCQA) started soon after HMOs became popular in the 1980s, measuring the effectiveness of the first managed care plans as millions of consumers flocked to join them.

Today, NCQA accredits health plans in every state, covering 109 million Americans or about 70 percent of all Americans enrolled in private coverage.

Founding and current president Margaret “Peggy” O’Kane discussed her organization’s past and future recently with KHN’s Phil Galewitz.

Phil Galewitz:  What do you see as NCQA’s biggest achievement after 25 years?

Margaret O’Kane:  Just getting the measurements out there in a systematic way. We are now finally at a stage where the delivery system is getting it and trying to reorganize itself with primary care medical homes and accountable care organizations.

Galewitz:  Is the United States doing a better job for consumers in measuring health plans’ quality of care?

O’Kane:  Maybe the glass is half full on measurement, or less than that. I think our strategy was to always walk behind the evidence. We have good measures where there is good evidence on preventive services and chronic diseases like hypertension and diabetes. What we are missing is often in areas where the science is unclear. These also tend to be high-stakes areas of care, like cancer or other complex illnesses.

Galewitz:  Are health plans receptive to being evaluated by NCQA?

O’Kane:  It’s less than voluntary, I would say. It’s in the health law for exchange plans (to be accredited by NCQA or another accrediting group) and has been driven by employers traditionally. Some plans really question whether it matters what (their) quality is. You see narrow networks emerging and if they are chosen just based on price, that isn’t going to go well among consumers.

Galewitz:  How much has NCQA’s work improved the quality of health care that Americans receive?

O’Kane:  In the areas we have measured, you can point to real improvements. My main gripe now is what I see as contradictory strategies of high deductibles versus a delivery system reform promoting primary care. If you have to spend out of your own pocket $2,000 or $5,000 before you get to see your primary care physician (for free), many Americans don’t have that money. We are reforming the delivery system and then people can’t afford to see their primary care doctor. That makes no sense.

http://khn.org/news/a-health-care-watchdog-for-consumers-turns-25/

As our health care system is being refined to supposedly replace quantity with quality in the delivery of health care services, we should learn from the experience of the National Committee for Quality Assurance (NCQA) – one of the more credible and experienced organizations attempting to improve quality in health care. Their founder and president, Margaret “Peggy” O’Kane, has a few lessons for us.

How are we doing on quality measurements? The glass is “half full… or less.” We are not doing well on “high-stakes areas of care, like cancer or other complex illnesses.” How can you ignore the quantity of care that is required for these complex cases and pretend that you are going to make payments based instead on quality that you can’t measure?

And the reception by the exchange health plans of the ACA requirement that they be accredited for quality? O’Kane says that the involvement of the plans is “less than voluntary.” She says, “Some plans really question whether it matters what (their) quality is.” Wow! Plans are setting up narrow networks that are based on price (while ignoring quality – DMc).

Her most important message: “My main gripe now is what I see as contradictory strategies of high deductibles versus a delivery system reform promoting primary care. If you have to spend out of your own pocket $2,000 or $5,000 before you get to see your primary care physician (for free), many Americans don’t have that money. We are reforming the delivery system and then people can’t afford to see their primary care doctor. That makes no sense.”

As the policy and political communities divert their efforts to structural reforms that have not been demonstrated to have more than a negligible impact on quality, the private insurance industry has moved forward with changes that are making health care unaffordable and inaccessible for far too many Americans. When what we need is a strong primary care infrastructure, our health care leaders are allowing the insurers to erect intolerable financial barriers to care. As O’Kane says, “That makes no sense.”

It’s great that we have dedicated organizations such as NCQA and AHRQ to help ferret out and correct quality problems. But we cannot let that distract us from what we really need to do: enact a well designed single payer national health program that will bring us the structural reforms that we desperately need, so all of us can have affordable, accessible, high quality health care.

Up With Extremism

By Thomas L. Friedman
The New York Times, January 6, 2016

It’s time for a true nonpartisan extremist, one whose platform combines the following:

*  A single-payer universal health care system. If it can work for Canada, Australia and Sweden and provide generally better health outcomes at lower prices, it can work for us, and get U.S. companies out of the health care business.

http://www.nytimes.com/2016/01/06/opinion/up-with-extremism.html

***

Comment:

By Don McCanne, M.D.

In his opinion piece, Thomas Friedman calls for electing a nonpartisan extremist for president. The first in his recommended list of extremist policy positions is a single payer universal health care system. Great!

The significance of this is that the debate over health care reform is not limited to tweaking the irreparable deficiencies of the Affordable Care Act (Democrats) versus paring back the government role in health care by shifting more of the financial responsibility to patients (Republicans). Although single payer was rejected during the campaign that led to the election of President Obama, it is now clear that Obamacare has perpetuated a wasteful, inefficient system that is increasing financial burdens and further impairing access for patients, even if greater numbers are nominally insured. And the tentative Republican proposals would make affordability and access even worse.

There is now a much broader understanding that single payer would provide the infrastructure that would ensure affordable care for everyone. The spark which has injected this into the presidential campaign is the strong endorsement by Bernie Sanders along with a token acknowledgement by the poll-leading Republican candidate – Donald Trump. We are seeing more single payer endorsements along with limited press coverage confirming that single payer is in play in this election. We should continue our efforts to amplify that. Low odds admittedly, but it’s there.

Just a note on Friedman’s article. He calls for “a nonpartisan extremist for president who’s ready to go far left and far right — simultaneously.” His list of policy recommendations includes some that are simply not acceptable in an enlightened society (mind you, I’m a pacifist). So we should make it clear that, though we are quite pleased with Friedman’s endorsement of single payer, we cannot reciprocate with an endorsement of several of his other policy positions.

Up With Extremism

By Thomas L. Friedman
The New York Times, January 6, 2016

It’s time for a true nonpartisan extremist, one whose platform combines the following:

*  A single-payer universal health care system. If it can work for Canada, Australia and Sweden and provide generally better health outcomes at lower prices, it can work for us, and get U.S. companies out of the health care business.

http://www.nytimes.com/2016/01/06/opinion/up-with-extremism.html

In his opinion piece, Thomas Friedman calls for electing a nonpartisan extremist for president. The first in his recommended list of extremist policy positions is a single payer universal health care system. Great!

The significance of this is that the debate over health care reform is not limited to tweaking the irreparable deficiencies of the Affordable Care Act (Democrats) versus paring back the government role in health care by shifting more of the financial responsibility to patients (Republicans). Although single payer was rejected during the campaign that led to the election of President Obama, it is now clear that Obamacare has perpetuated a wasteful, inefficient system that is increasing financial burdens and further impairing access for patients, even if greater numbers are nominally insured. And the tentative Republican proposals would make affordability and access even worse.

There is now a much broader understanding that single payer would provide the infrastructure that would ensure affordable care for everyone. The spark which has injected this into the presidential campaign is the strong endorsement by Bernie Sanders along with a token acknowledgement by the poll-leading Republican candidate – Donald Trump. We are seeing more single payer endorsements along with limited press coverage confirming that single payer is in play in this election. We should continue our efforts to amplify that. Low odds admittedly, but it’s there.

Just a note on Friedman’s article. He calls for “a nonpartisan extremist for president who’s ready to go far left and far right — simultaneously.” His list of policy recommendations includes some that are simply not acceptable in an enlightened society (mind you, I’m a pacifist). So we should make it clear that, though we are quite pleased with Friedman’s endorsement of single payer, we cannot reciprocate with an endorsement of several of his other policy positions.

Key Proposals to Strengthen the Affordable Care Act

By Timothy Stoltzfus Jost and Harold Pollack
The Century Foundation, December 15, 2015

The ACA undertook from the beginning an ambitious reform agenda, but some of its approaches have turned out to be ineffective, poorly targeted, or not ambitious enough to address deeply rooted problems.

Many of the remaining challenges in health care reform reflect the inherent complexities and path-dependency of the American system and were beyond the reach of any politically feasible reform. Perhaps the most serious problem — which this report will address repeatedly — is the inadequacy of the ACA’s subsidies and regulatory structures to address the problems of low-income Americans, for whom merely meeting the costs of day-to-day essentials is a continuing challenge, and for whom even modest monthly insurance premiums and cost-sharing are often serious barriers to health coverage and care.

This report identifies problems and suggests potential solutions. Some solutions would require federal legislation. Others could be implemented by the administration, state law, or by private parties.

In all, we propose nineteen steps that could help fix recognized flaws in the ACA as well as build on its accomplishments. Taken together, these proposals would further improve the access and affordability of health care under the ACA, create more robust provider networks, enhance competition among insurers, improve the consumer experience, and strengthen the Medicaid program. We understand that in the current political climate, improvements to the ACA that require congressional action are unlikely.

1. Expanding Access to Health Coverage for Moderate-Income Americans

*  Fix the Family Glitch.

*  Reduce Complexity in the Tax Credit Program.

*  Increase Credits for Moderate- and Middle-Income Families.

2. Making Health Care Affordable

*  Reduce Cost-sharing and Out-of-Pocket Limits and Improve Minimum Employer Coverage Requirements.

*  Increase Use of Health Savings Accounts for Moderate-Income Americans.

*  Allow Use of Health Reimbursement Accounts to Purchase Health Insurance.

*  Incorporate Value-based Insurance Design to Support Coverage for High-Value Services.

*  Improve State Regulation of Network and Formulary Adequacy.

*  Improve Protection from Balance Billing.

3. Improving the Consumer Marketplace Experience

*  Actively Guide Consumers in Coverage Selection.

*  Improve Network and Formulary Transparency.

*  Standardize Insurance Products.

4. Improving Medicaid for Low-Income Americans

*  Have the Federal Government Permanently Assume the Entire Cost of the Medicaid Expansion Population.

*  Constrain 1115 Waivers.

*  Eliminate Medicaid Estate Recoveries from the Expansion Population.

*  Improve Medicaid Payment Rates.

*  Ensure a Judicially Enforceable Right to Adequate Access to Medicaid Providers and to Adequate Medicaid Payment Rates.

*  Reconsider a “Public Option” Early Medicare Coverage within Health Insurance Marketplaces.

*  Raise or Eliminate Medicaid and Supplemental Security Income Asset Limits for People Living with Disabilities.

From the Conclusion

This report offers a number of proposals for building on the ACA, to make health coverage and health care even more affordable, accessible, and understandable for Americans. We understand that in the current political climate, improvements to the ACA that require congressional action are unlikely. Yet an administration committed to improving access could take some of the actions we recommend without new legislation, while other proposals could be implemented by the states, marketplace, or simply by insurers.

http://www.tcf.org/assets/downloads/TCF_KeyProposalstoStrengthenACA.pdf

***

Comment:

By Don McCanne, M.D.

Congress is divided on what to do about our expensive but highly dysfunctional health care system. Congressional opponents of the Affordable Care Act (ACA) today will vote for the 62nd time to repeal the Act without offering any replacement, and President Obama will veto the legislation. In contrast, supporters of health care reform would like to improve the system so that it works better for everyone.

There are two approaches to improving the system: either build on ACA and the existing financing system, or replace it with a single payer system. Today’s report is by two highly respected professors who are personally dedicated to health care justice – Timothy Stoltzfus Jost and Harold Pollack – and they would build on ACA. Thus today’s report represents the best of the “repair and improve” approach.

Take a close look at the nineteen recommendations by these two revered individuals who really care about our health care system, and then think about what impact these recommendations would have. Most of the them would hardly qualify as tweaks, though several of them would certainly be beneficial if we were to support the perpetuation of the current system. But what they do not do is to provide a new financing infrastructure that we would need to improve efficiency, equity, universality, access, quality, comprehensiveness, affordability, portability, and to reduce the administrative burden through public administration – features of a single payer national health program.

We can be thankful that we have individuals like Timothy Jost and Harold Pollack who have dedicated themselves to improve what we have. Until we can enact a single payer system, we need their efforts to continue. Yet they concede that “improvements to the ACA that require congressional action are unlikely.” That is the same reason given for not advocating for a single payer system – it supposedly is not politically feasible. But you don’t compromise policy for politics. You change politics so that you can achieve optimal policy.

Unfortunately Harold Pollack has a problem with PNHP. He has written, “I happen to dislike PNHP leaders’ unhelpful stance in the current debate,” and “I wish the group would talk and act rather differently in this debate,” and “Indeed its leaders denigrate important provisions of ACA that expand access for 32 million people and protect millions against catastrophic financial risks.” In fact, we have supported the beneficial gains of ACA as important transitional improvements until we can move the political process to achieve single payer. This matters because this abrasiveness has reduced the framing to incremental changes or nothing, when the framing should be incremental changes or single payer.

From the list in this report, the proposed incremental changes are far too feeble when compared to the need. I feel certain that Timothy Jost would be on board if there were a politically feasible path to single payer. I just wish Harold Pollack would join us as well.

https://pnhp.org/blog/2015/07/09/seidman-and-pollack-aca-versus-medicare-for-all/

Key Proposals to Strengthen the Affordable Care Act

By Timothy Stoltzfus Jost and Harold Pollack
The Century Foundation, December 15, 2015

The ACA undertook from the beginning an ambitious reform agenda, but some of its approaches have turned out to be ineffective, poorly targeted, or not ambitious enough to address deeply rooted problems.

Many of the remaining challenges in health care reform reflect the inherent complexities and path-dependency of the American system and were beyond the reach of any politically feasible reform. Perhaps the most serious problem — which this report will address repeatedly — is the inadequacy of the ACA’s subsidies and regulatory structures to address the problems of low-income Americans, for whom merely meeting the costs of day-to-day essentials is a continuing challenge, and for whom even modest monthly insurance premiums and cost-sharing are often serious barriers to health coverage and care.

This report identifies problems and suggests potential solutions. Some solutions would require federal legislation. Others could be implemented by the administration, state law, or by private parties.

In all, we propose nineteen steps that could help fix recognized flaws in the ACA as well as build on its accomplishments. Taken together, these proposals would further improve the access and affordability of health care under the ACA, create more robust provider networks, enhance competition among insurers, improve the consumer experience, and strengthen the Medicaid program. We understand that in the current political climate, improvements to the ACA that require congressional action are unlikely.

1. Expanding Access to Health Coverage for Moderate-Income Americans

*  Fix the Family Glitch.

*  Reduce Complexity in the Tax Credit Program.

*  Increase Credits for Moderate- and Middle-Income Families.

2. Making Health Care Affordable

*  Reduce Cost-sharing and Out-of-Pocket Limits and Improve Minimum Employer Coverage Requirements.

*  Increase Use of Health Savings Accounts for Moderate-Income Americans.

*  Allow Use of Health Reimbursement Accounts to Purchase Health Insurance.

*  Incorporate Value-based Insurance Design to Support Coverage for High-Value Services.

*  Improve State Regulation of Network and Formulary Adequacy.

*  Improve Protection from Balance Billing.

3. Improving the Consumer Marketplace Experience

*  Actively Guide Consumers in Coverage Selection.

*  Improve Network and Formulary Transparency.

*  Standardize Insurance Products.

4. Improving Medicaid for Low-Income Americans

*  Have the Federal Government Permanently Assume the Entire Cost of the Medicaid Expansion Population.

*  Constrain 1115 Waivers.

*  Eliminate Medicaid Estate Recoveries from the Expansion Population.

*  Improve Medicaid Payment Rates.

*  Ensure a Judicially Enforceable Right to Adequate Access to Medicaid Providers and to Adequate Medicaid Payment Rates.

*  Reconsider a “Public Option” Early Medicare Coverage within Health Insurance Marketplaces.

*  Raise or Eliminate Medicaid and Supplemental Security Income Asset Limits for People Living with Disabilities.

From the Conclusion

This report offers a number of proposals for building on the ACA, to make health coverage and health care even more affordable, accessible, and understandable for Americans. We understand that in the current political climate, improvements to the ACA that require congressional action are unlikely. Yet an administration committed to improving access could take some of the actions we recommend without new legislation, while other proposals could be implemented by the states, marketplace, or simply by insurers.

http://www.tcf.org/assets/downloads/TCF_KeyProposalstoStrengthenACA.pdf

Congress is divided on what to do about our expensive but highly dysfunctional health care system. Congressional opponents of the Affordable Care Act (ACA) today will vote for the 62nd time to repeal the Act without offering any replacement, and President Obama will veto the legislation. In contrast, supporters of health care reform would like to improve the system so that it works better for everyone.There are two approaches to improving the system: either build on ACA and the existing financing system, or replace it with a single payer system. Today’s report is by two highly respected professors who are personally dedicated to health care justice – Timothy Stoltzfus Jost and Harold Pollack – and they would build on ACA. Thus today’s report represents the best of the “repair and improve” approach.

Take a close look at the nineteen recommendations by these two revered individuals who really care about our health care system, and then think about what impact these recommendations would have. Most of the them would hardly qualify as tweaks, though several of them would certainly be beneficial if we were to support the perpetuation of the current system. But what they do not do is to provide a new financing infrastructure that we would need to improve efficiency, equity, universality, access, quality, comprehensiveness, affordability, portability, and to reduce the administrative burden through public administration – features of a single payer national health program.

We can be thankful that we have individuals like Timothy Jost and Harold Pollack who have dedicated themselves to improve what we have. Until we can enact a single payer system, we need their efforts to continue. Yet they concede that “improvements to the ACA that require congressional action are unlikely.” That is the same reason given for not advocating for a single payer system – it supposedly is not politically feasible. But you don’t compromise policy for politics. You change politics so that you can achieve optimal policy.

Unfortunately Harold Pollack has a problem with PNHP. He has written, “I happen to dislike PNHP leaders’ unhelpful stance in the current debate,” and “I wish the group would talk and act rather differently in this debate,” and “Indeed its leaders denigrate important provisions of ACA that expand access for 32 million people and protect millions against catastrophic financial risks.” In fact, we have supported the beneficial gains of ACA as important transitional improvements until we can move the political process to achieve single payer. This matters because this abrasiveness has reduced the framing to incremental changes or nothing, when the framing should be incremental changes or single payer.

From the list in this report, the proposed incremental changes are far too feeble when compared to the need. I feel certain that Timothy Jost would be on board if there were a politically feasible path to single payer. I just wish Harold Pollack would join us as well.

https://pnhp.org/blog/2015/07/09/seidman-and-pollack-aca-versus-medicare-for-all/

The Burden of Medical Debt: Results from the Kaiser Family Foundation/New York Times Medical Bills Survey

Prepared by: Liz Hamel, Mira Norton, Karen Pollitz, Larry Levitt, Gary Claxton and Mollyann Brodie
Kaiser Family Foundation, December 2015

Previous Kaiser surveys have found that about a quarter of people say they or someone in their household had problems paying medical bills in the past year, and a 2014 Kaiser report provided a qualitative look at some of the circumstances and consequences of unpaid medical bills through interviews with people who had sought credit counseling for medical debt. But to date, there has been little research providing a quantitative look at the causes of medical bill problems and the impacts they have on people’s families, their finances, and their access to health care.

To fill this gap, the Kaiser Family Foundation and The New York Times conducted an in-depth survey with 1,204 adults ages 18-64 who report that they or someone in their household had problems paying or an inability to pay medical bills in the previous 12 months.

Prevalence of problems paying medical bills among different groups

Insurance status has a strong association with medical bill difficulties, with over half (53 percent) of the uninsured saying they had problems paying household medical bills in the past year. However, as previous surveys have shown, insurance is not a panacea against these problems. Roughly one in five of those with health insurance through an employer (19 percent), Medicaid (18 percent), or purchased on their own (22 percent) also report problems paying medical bills. In fact, overall among all people with household medical bill problems, more than six in ten (62 percent) say the person who incurred the bills was covered by health insurance, while a third (34 percent) say that person was uninsured. Among those with private insurance (either through an employer or self-purchased), their plan’s deductible makes a difference in ability to afford health care bills, with those in higher deductible plans more likely to report medical bill problems than those in plans with lower deductibles (26 percent versus 15 percent).

To explore these relationships further, we used a statistical technique called logistic regression analysis to isolate which demographic characteristics are the strongest predictors of problems paying medical bills when holding other factors constant. In that analysis, income, insurance status, and all 3 measures of health status (being in fair or poor health and having a disability or chronic condition) had a significant and strong association with problems paying medical bills, even after accounting for the influence of the other demographic factors. Having a private insurance plan with a high deductible also remained a significant predictor, even after controlling for other factors, as did being under age 25 and having minor children at home.

Circumstances leading to problems paying medical bills

Among those who report problems paying medical bills, two-thirds (66 percent) say the bills were the result of a one-time or short-term medical expense such as a hospital stay or an accident, while 33 percent cite bills for treatment of chronic conditions that have built up over time. These shares are similar for people who faced medical bill problems with and without insurance coverage.

Asked which types of bills made up the largest share of what they owed, the most common responses are emergency room visits (21 percent) and hospitalization (20 percent), followed by dental care (12 percent) and diagnostic tests like X-rays and MRIs (11 percent).

Among who say their bill problems were the result of a one-time or short-term medical expense, just under one in five (18 percent) cite an accident as the main cause. Most of the others name illnesses, pain, dental issues, or surgery, suggesting that although most bill problems are caused by one-time events, these events are often acute episodes of illness or expensive surgeries, medications or tests, rather than injuries caused by accidents.

Financial status of those with bill problems

About three in ten (31 percent) of those with medical bill problems say the total amount of the bills they had problems paying was $5,000 or more, including 13 percent who report bills adding to at least $10,000.

Many of those with medical bill problems report struggling with bills of lower amounts, including 24 percent of the insured and 22 percent of the uninsured who say their bills amounted to less than $1,000. While these lower amounts may seem small, even a bill of $500 or less can present a major problem for someone who is living paycheck to paycheck. In fact, when asked to describe their financial situation, about six in ten (61 percent) of those who’ve had problems paying medical bills say they either just meet their basic expenses (43 percent) or don’t have enough to meet basic expenses (18 percent).

Even among the insured, those who have faced medical bill problems are significantly more likely than their counterparts who haven’t had such problems to say they are either just getting by or don’t have enough to make ends meet (55 percent versus 22 percent).

Compared to those without medical debt, those who’ve had medical bill problems are also less likely to say they have a credit card (53 percent versus 77 percent), a retirement savings account (43 percent versus 62 percent), or some other type of savings (17 percent versus 38 percent).

About three in ten (29 percent) say that someone in their household had to take a cut in pay or hours as a result of the illness that led to the medical bills, either because of the illness itself or in order to care for the person who was sick.

Medical bill problems among those with health insurance

While problems paying medical bills are more common among the uninsured, more than six in ten (62 percent) of those who had problems paying medical bills say the person who incurred the bills was covered by health insurance when treatment began.

Of those who were insured when the bills were incurred, three-quarters (75 percent) say that the amount they had to pay for their insurance copays, deductibles, or coinsurance was more than they could afford.

About three in 10 (32 percent) of those who had problems paying medical bills while insured say they received care from an out-of-network provider that their insurance wouldn’t pay for. For many, these bills came as a surprise.

About a quarter (26 percent) of the insured who had medical bill problems say they had a claim denied by their insurance company.

The impact of medical bills on families

Among those with medical bill problems, almost identical shares of the insured (44 percent) and uninsured (45 percent) say the bills have had a major impact on their families.

A few groups among those with medical bill problems are more likely to say the medical bills have had a major impact on their families, including people with bills amounting to $5,000 or more (66 percent), those who say the family member who generated the bills has a disability (57 percent), and those who describe their financial situation as not having enough to meet basic expenses (56 percent).

Sacrifices made to pay medical bills

Even among those with health insurance, people who’ve faced medical bill problems report making various sacrifices in order to pay these bills, including significant changes to their employment, financial situation, or lifestyle. Overall, about seven in ten report cutting back or delaying vacations or major household purchases (72 percent) as well as reducing spending on food, clothing and basic household items (70 percent). About six in ten (59 percent) say they used up all or most of their savings in order to pay medical bills. Substantial shares say that someone in their household took on an extra job or worked more hours (41 percent), borrowed money from family and friends (37 percent), or increased their credit card debt (34 percent). Roughly a quarter (26 percent) say they took money out of a retirement, college, or other long-term savings account. Smaller – but not inconsequential – shares say they changed their living situation (17 percent), took out another type of loan (15 percent), borrowed from a payday lender (13 percent), or sought the aid of a charity or non-profit (12 percent) in order to pay medical bills.

These sacrifices are reported by people in all walks of life, and not just the uninsured or those with precarious financial situations.

Effects of medical bills on ability to get needed health care

Overall, about three in ten (31 percent) of those who faced problems paying medical bills say they had problems getting other health care they needed directly as a result of these problems.

More broadly, many of those with medical bill problems report delaying or skipping health care over the past 12 months because of the cost – at rates 2 to 3 times those of their counterparts who did not have problems paying medical bills, regardless of their insurance status.

Effects of medical bills on household finances and ability to afford basic needs

Medical bills can also lead to problems meeting other financial obligations and paying for basic necessities. Among those with medical bill problems, about six in ten of both the insured (62 percent) and the uninsured (62 percent) say they’ve had difficulty paying other bills as a result of medical debt. Over a third in each group (34 percent of the insured and 39 percent of the uninsured) say they were unable to pay for basic necessities like food, heat, or housing as a result of medical bills.

Most of those with medical bill problems report having other kinds of debt, including credit card debt (56 percent), car loans (46 percent), student loans (33 percent), mortgages (32 percent), payday loans (17 percent), and other outstanding loans (31 percent).

For some of those with problems paying medical bills, medical debt makes up a large share of their total debt. About one in five (22 percent, including 17 percent of the insured and 34 percent of the uninsured) say their medical bills represent all or almost all of their total non-mortgage debt.

The survey also finds that once medical bill problems start, it can be difficult to make them stop, and that for some, medical bills can start a cascade of other bill problems.

While almost half (47 percent) say they’ve also had problems paying other unrelated bills in the past year, medical bills appear to be either the sole problem or the main trigger of bill problems for the other half, including 31 percent who say they’ve only had problems with medical bills, not other types of bills, and 19 percent who say their problems paying other bills started as a result of their medical bills.

Financial consequences of struggling to make payments

Once a person has problems paying medical bills, their insurance status appears to make little difference in their ability to pay bills on time. Among those with medical bill problems, similar shares of the insured and uninsured say they’ve been late on a payment (62 percent and 63 percent, respectively) or missed a payment (55 percent and 61 percent) for a medical bill in the past year.

Likely as a result of missed or late payments, almost six in ten (58 percent) of those with medical bill problems say they’ve been contacted by a collection agency in the past year, mostly because of medical bills alone (25 percent) or a combination of medical bills and some other type of debt (20 percent).

Overall, 11 percent say they’ve declared bankruptcy at some point and that medical bills were at least a partial contributor to their bankruptcy.

From the Conclusion

Insurance features like cost-sharing, provider networks, and confusing billing practices can all lead to medical bill problems among the insured. While higher deductibles and other forms of cost-sharing have helped to keep health insurance premium growth at historically low levels in recent years, the survey highlights the consequences these changes can have for people.

The survey also shows that medical bill problems can have real and often lasting impacts on individuals and families in terms of their standard of living, their financial stability, and their ability to access needed health care. While insurance provides some protection against incurring medical bill problems in the first place, once these problems occur, the effects on individuals and families are often as serious for the insured as they are for the uninsured.

Full report (32 pages):
https://kaiserfamilyfoundation.files.wordpress.com/2016/12/8806-the-burden-of-medical-debt-results-from-the-kaiser-family-foundation-new-york-times-medical-bills-survey1.pdf

***

Comment:

By Don McCanne, M.D.

These excerpts from the Kaiser Family Foundation/New York Times Medical Bills Survey of adults 18 to 64 confirm once again that our multi-payer health insurance system falls far short in preventing financial insecurity for those with medical needs. This survey expands on our knowledge base by demonstrating the deplorable consequences of the financial hardships created by this system.

These deficiencies cannot be corrected by merely tweaking our current dysfunctional financing system. A massive infusion of funds would be required under the current system if we wish to reduce the negative financial consequences, but the political and policy communities currently oppose any increase in spending. In fact, their current approach is to control spending by increasing barriers to care through unaffordable cost sharing and narrower networks designed to reduce access. Obstructing access to care might reduce spending, but preventing beneficial health care is the opposite of what a health care financing system should be doing.

Think of that. It is bad enough that people have the misfortune to suffer medical disorders, yet we add to that grief by perpetuating a system that dumps personal financial hardship on top of their medical misfortunes.

The efficiencies of a single payer system would save enough to more assuredly enable access to appropriate health care services by removing cost-sharing barriers to care, not to mention the benefit that absolutely everyone would be included. What are we waiting for? The status quo is unequivocally unacceptable.

The Burden of Medical Debt: Results from the Kaiser Family Foundation/New York Times Medical Bills Survey

Prepared by: Liz Hamel, Mira Norton, Karen Pollitz, Larry Levitt, Gary Claxton and Mollyann Brodie
Kaiser Family Foundation, December 2015

Previous Kaiser surveys have found that about a quarter of people say they or someone in their household had problems paying medical bills in the past year, and a 2014 Kaiser report provided a qualitative look at some of the circumstances and consequences of unpaid medical bills through interviews with people who had sought credit counseling for medical debt. But to date, there has been little research providing a quantitative look at the causes of medical bill problems and the impacts they have on people’s families, their finances, and their access to health care.

To fill this gap, the Kaiser Family Foundation and The New York Times conducted an in-depth survey with 1,204 adults ages 18-64 who report that they or someone in their household had problems paying or an inability to pay medical bills in the previous 12 months.

Prevalence of problems paying medical bills among different groups

Insurance status has a strong association with medical bill difficulties, with over half (53 percent) of the uninsured saying they had problems paying household medical bills in the past year. However, as previous surveys have shown, insurance is not a panacea against these problems. Roughly one in five of those with health insurance through an employer (19 percent), Medicaid (18 percent), or purchased on their own (22 percent) also report problems paying medical bills. In fact, overall among all people with household medical bill problems, more than six in ten (62 percent) say the person who incurred the bills was covered by health insurance, while a third (34 percent) say that person was uninsured. Among those with private insurance (either through an employer or self-purchased), their plan’s deductible makes a difference in ability to afford health care bills, with those in higher deductible plans more likely to report medical bill problems than those in plans with lower deductibles (26 percent versus 15 percent).

To explore these relationships further, we used a statistical technique called logistic regression analysis to isolate which demographic characteristics are the strongest predictors of problems paying medical bills when holding other factors constant. In that analysis, income, insurance status, and all 3 measures of health status (being in fair or poor health and having a disability or chronic condition) had a significant and strong association with problems paying medical bills, even after accounting for the influence of the other demographic factors. Having a private insurance plan with a high deductible also remained a significant predictor, even after controlling for other factors, as did being under age 25 and having minor children at home.

Circumstances leading to problems paying medical bills

Among those who report problems paying medical bills, two-thirds (66 percent) say the bills were the result of a one-time or short-term medical expense such as a hospital stay or an accident, while 33 percent cite bills for treatment of chronic conditions that have built up over time. These shares are similar for people who faced medical bill problems with and without insurance coverage.

Asked which types of bills made up the largest share of what they owed, the most common responses are emergency room visits (21 percent) and hospitalization (20 percent), followed by dental care (12 percent) and diagnostic tests like X-rays and MRIs (11 percent).

Among who say their bill problems were the result of a one-time or short-term medical expense, just under one in five (18 percent) cite an accident as the main cause. Most of the others name illnesses, pain, dental issues, or surgery, suggesting that although most bill problems are caused by one-time events, these events are often acute episodes of illness or expensive surgeries, medications or tests, rather than injuries caused by accidents.

Financial status of those with bill problems

About three in ten (31 percent) of those with medical bill problems say the total amount of the bills they had problems paying was $5,000 or more, including 13 percent who report bills adding to at least $10,000.

Many of those with medical bill problems report struggling with bills of lower amounts, including 24 percent of the insured and 22 percent of the uninsured who say their bills amounted to less than $1,000. While these lower amounts may seem small, even a bill of $500 or less can present a major problem for someone who is living paycheck to paycheck. In fact, when asked to describe their financial situation, about six in ten (61 percent) of those who’ve had problems paying medical bills say they either just meet their basic expenses (43 percent) or don’t have enough to meet basic expenses (18 percent).

Even among the insured, those who have faced medical bill problems are significantly more likely than their counterparts who haven’t had such problems to say they are either just getting by or don’t have enough to make ends meet (55 percent versus 22 percent).

Compared to those without medical debt, those who’ve had medical bill problems are also less likely to say they have a credit card (53 percent versus 77 percent), a retirement savings account (43 percent versus 62 percent), or some other type of savings (17 percent versus 38 percent).

About three in ten (29 percent) say that someone in their household had to take a cut in pay or hours as a result of the illness that led to the medical bills, either because of the illness itself or in order to care for the person who was sick.

Medical bill problems among those with health insurance

While problems paying medical bills are more common among the uninsured, more than six in ten (62 percent) of those who had problems paying medical bills say the person who incurred the bills was covered by health insurance when treatment began.

Of those who were insured when the bills were incurred, three-quarters (75 percent) say that the amount they had to pay for their insurance copays, deductibles, or coinsurance was more than they could afford.

About three in 10 (32 percent) of those who had problems paying medical bills while insured say they received care from an out-of-network provider that their insurance wouldn’t pay for. For many, these bills came as a surprise.

About a quarter (26 percent) of the insured who had medical bill problems say they had a claim denied by their insurance company.

The impact of medical bills on families

Among those with medical bill problems, almost identical shares of the insured (44 percent) and uninsured (45 percent) say the bills have had a major impact on their families.

A few groups among those with medical bill problems are more likely to say the medical bills have had a major impact on their families, including people with bills amounting to $5,000 or more (66 percent), those who say the family member who generated the bills has a disability (57 percent), and those who describe their financial situation as not having enough to meet basic expenses (56 percent).

Sacrifices made to pay medical bills

Even among those with health insurance, people who’ve faced medical bill problems report making various sacrifices in order to pay these bills, including significant changes to their employment, financial situation, or lifestyle. Overall, about seven in ten report cutting back or delaying vacations or major household purchases (72 percent) as well as reducing spending on food, clothing and basic household items (70 percent). About six in ten (59 percent) say they used up all or most of their savings in order to pay medical bills. Substantial shares say that someone in their household took on an extra job or worked more hours (41 percent), borrowed money from family and friends (37 percent), or increased their credit card debt (34 percent). Roughly a quarter (26 percent) say they took money out of a retirement, college, or other long-term savings account. Smaller – but not inconsequential – shares say they changed their living situation (17 percent), took out another type of loan (15 percent), borrowed from a payday lender (13 percent), or sought the aid of a charity or non-profit (12 percent) in order to pay medical bills.

These sacrifices are reported by people in all walks of life, and not just the uninsured or those with precarious financial situations.

Effects of medical bills on ability to get needed health care

Overall, about three in ten (31 percent) of those who faced problems paying medical bills say they had problems getting other health care they needed directly as a result of these problems.

More broadly, many of those with medical bill problems report delaying or skipping health care over the past 12 months because of the cost – at rates 2 to 3 times those of their counterparts who did not have problems paying medical bills, regardless of their insurance status.

Effects of medical bills on household finances and ability to afford basic needs

Medical bills can also lead to problems meeting other financial obligations and paying for basic necessities. Among those with medical bill problems, about six in ten of both the insured (62 percent) and the uninsured (62 percent) say they’ve had difficulty paying other bills as a result of medical debt. Over a third in each group (34 percent of the insured and 39 percent of the uninsured) say they were unable to pay for basic necessities like food, heat, or housing as a result of medical bills.

Most of those with medical bill problems report having other kinds of debt, including credit card debt (56 percent), car loans (46 percent), student loans (33 percent), mortgages (32 percent), payday loans (17 percent), and other outstanding loans (31 percent).

For some of those with problems paying medical bills, medical debt makes up a large share of their total debt. About one in five (22 percent, including 17 percent of the insured and 34 percent of the uninsured) say their medical bills represent all or almost all of their total non-mortgage debt.

The survey also finds that once medical bill problems start, it can be difficult to make them stop, and that for some, medical bills can start a cascade of other bill problems.

While almost half (47 percent) say they’ve also had problems paying other unrelated bills in the past year, medical bills appear to be either the sole problem or the main trigger of bill problems for the other half, including 31 percent who say they’ve only had problems with medical bills, not other types of bills, and 19 percent who say their problems paying other bills started as a result of their medical bills.

Financial consequences of struggling to make payments

Once a person has problems paying medical bills, their insurance status appears to make little difference in their ability to pay bills on time. Among those with medical bill problems, similar shares of the insured and uninsured say they’ve been late on a payment (62 percent and 63 percent, respectively) or missed a payment (55 percent and 61 percent) for a medical bill in the past year.

Likely as a result of missed or late payments, almost six in ten (58 percent) of those with medical bill problems say they’ve been contacted by a collection agency in the past year, mostly because of medical bills alone (25 percent) or a combination of medical bills and some other type of debt (20 percent).

Overall, 11 percent say they’ve declared bankruptcy at some point and that medical bills were at least a partial contributor to their bankruptcy.

From the Conclusion

Insurance features like cost-sharing, provider networks, and confusing billing practices can all lead to medical bill problems among the insured. While higher deductibles and other forms of cost-sharing have helped to keep health insurance premium growth at historically low levels in recent years, the survey highlights the consequences these changes can have for people.

The survey also shows that medical bill problems can have real and often lasting impacts on individuals and families in terms of their standard of living, their financial stability, and their ability to access needed health care. While insurance provides some protection against incurring medical bill problems in the first place, once these problems occur, the effects on individuals and families are often as serious for the insured as they are for the uninsured.

Full report (32 pages):
https://kaiserfamilyfoundation.files.wordpress.com/2016/12/8806-the-burden-of-medical-debt-results-from-the-kaiser-family-foundation-new-york-times-medical-bills-survey1.pdf

These excerpts from the Kaiser Family Foundation/New York Times Medical Bills Survey of adults 18 to 64 confirm once again that our multi-payer health insurance system falls far short in preventing financial insecurity for those with medical needs. This survey expands on our knowledge base by demonstrating the deplorable consequences of the financial hardships created by this system.These deficiencies cannot be corrected by merely tweaking our current dysfunctional financing system. A massive infusion of funds would be required under the current system if we wish to reduce the negative financial consequences, but the political and policy communities currently oppose any increase in spending. In fact, their current approach is to control spending by increasing barriers to care through unaffordable cost sharing and narrower networks designed to reduce access. Obstructing access to care might reduce spending, but preventing beneficial health care is the opposite of what a health care financing system should be doing.

Think of that. It is bad enough that people have the misfortune to suffer medical disorders, yet we add to that grief by perpetuating a system that dumps personal financial hardship on top of their medical misfortunes.

The efficiencies of a single payer system would save enough to more assuredly enable access to appropriate health care services by removing cost-sharing barriers to care, not to mention the benefit that absolutely everyone would be included. What are we waiting for? The status quo is unequivocally unacceptable.