We need a system that is truly universal—everybody in, nobody out. Biden’s proposal will add more participants to the current program, but still leave millions out.

By F. Douglas Stephenson
Common Dreams, March 11, 2021

President Biden, the Democratic Party and America’s neoliberal vision of world order is rooted in an economic philosophy of privatization and financialization. Administrative costs (and immense profiteering) are greater in the private health care insurance system, and even Medicare itself is weakened by having to work through the private system.

Biden and many Democrats have spent their careers defending the financial sector, including big insurance and big pharma, whose leading policy is also to maintain and further privatize basic health care financing and infrastructure. As such, he represents the banking and credit-card industry. He sponsored the regressive bankruptcy “reform” written and put into his hands by the credit-card companies. As a budget hawk, he’s rejected “Medicare for all” as if it is too expensive for the government to afford.

Although health insurance affordability for the majority of US citizens remains a very large problem, Pres. Biden’s latest health insurance plan wants to shift many more dollars into private, Wall Street insurance industry hands. The takeover of health insurance by private Wall Street entities continues apace as Democrats/Biden propose to increase taxes and give it to the private profit insurance industry—the source of our profound administrative waste, along with the costly administrative burdens they place on the delivery system. Profiteering continues unabated as private insurance sells us services we don’t need/want, such as deductibles and other cost sharing, maintenance of narrow networks, requiring prior authorization with increased administrative costs, excessive ongoing paperwork/documentation requirements, all while avoiding paying for surprise bills and other denied benefits.

The private insurance industry is very happy that with ACA, Americans are forced to purchase the product of their private industry plus give huge tax-financed subsidies to their industry in the amount of a half-trillion dollars per decade.

When compared to an improved, single payer Medicare for All (M4A) insurance plan, Biden’s plan is disappointing and at best a bandaid approach. We need a system that is truly universal—everybody in, nobody out. Biden’s proposal will add more participants to the current program, but still leave millions out. M4A is truly universal:

1. Patients should have free choice of their professionals and health care institutions. Biden would continue health plans with restrictive networks that take away free choice. M4A allows choices within the entire health care system.
2. The privatization of public programs such as Medicare through Medicare Advantage and Medicaid through private managed care programs have proven to provide poor value for the taxpayer (obscured by cherry picking and lemon dropping) and should be eliminated. Biden would continue these programs, whereas M4A would eliminate them.
3. Fragmentation results in dysfunctional financing of health care. Biden would perpetuate fragmentation whereas M4A would bring an end to it.
4. Biden’s proposals would add more administrative burden along with the costs they entail. M4A is specifically designed to greatly reduce this burden and its associated costs.
5. Medicaid carries the stigma of being a welfare program which results in legislative underfunding and neglect. Biden would attempt to expand Medicaid in those states that have underutilized it. M4A would terminate the program and move everyone into a universal, comprehensive and equitable program.
6. We need a program that is affordable for each individual and for society as a whole. Biden’s plan will add significantly more spending to the program while leaving it still unaffordable for too many individuals. M4A would achieve all goals of financing reform without significantly increasing spending.
7. Health care coverage should be stable and permanent throughout life. Biden’s proposed fixes would be temporary, many expiring in two years. It is likely that legislators would develop reform fatigue in this session and fail to follow up with more permanent measures. M4A would be a single program—permanent throughout life.
8. Employer-sponsored insurance can create problems such as job lock, which many conservatives and progressives believe should be terminated. Biden would perpetuate it since it involves less government involvement—predominantly private spending with a tax benefit. M4A would end employer-sponsored insurance, and, for many, M4A would be better.

The highly respected British medical journal, “The Lancet,” recently summarized the health insurance situation in the USA:

“Although health care expenditure per capita is higher in the USA than in any other country, more than 37 million Americans do not have health insurance, and 41 million more have inadequate access to care. Efforts are ongoing to repeal/revise the Affordable Care Act which would exacerbate health-care inequities. By contrast, a universal system, such as that proposed in the Medicare for All Act, has the potential to transform the availability and efficiency of American health-care services. Taking into account both the costs of coverage expansion and the savings that would be achieved through the Medicare for All Act, we calculate that a single-payer, universal health-care system is likely to lead to a 13% savings in national health-care expenditure, equivalent to more than US $450 billion annually (based on the value of the US$ in 2017). The entire system could be funded with less financial outlay than is incurred by employers and households paying for health-care premiums combined with existing government allocations. This shift to single-payer health care would provide the greatest relief to lower-income households. Furthermore, we estimate that ensuring health-care access for all Americans would save more than 68,000 lives and 1·73 million life-years every year compared with the status quo.”

https://www.commondreams.org…

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Providers Blast Medicare Spending Cuts in COVID Relief Package: The American Rescue Plan triggers automatic cuts as a deficit control measure that will result in $36 billion in Medicare spending cuts in fiscal year 2022.

By Jacqueline LaPointe
RevCycleIntelligence, March 11, 2021

Leading healthcare industry groups are praising the package’s many healthcare provisions, particularly policies that support healthcare coverage for more Americans and widespread vaccination. But these benefits will come at a cost to healthcare providers, the groups are saying.

Implementation of the American Rescue Plan will trigger automatic spending cuts as a deficit control measure, resulting in $36 billion in Medicare spending cuts in fiscal year 2020 alone, AMGA (American Medical Group Association) states.

“Cutting billions from the Medicare program now would undermine healthcare providers who have heroically rallied all year to care for their patients and communities,” Jerry Penso, MD, MBA, president and CEO of AMGA, said in the statement yesterday.

https://revcycleintelligence.com…

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Comment:

By Don McCanne, M.D.

The American Rescue Plan Act of 2021 – a much needed $1.9 trillion economic stimulus bill – was signed into law by President Joe Biden this week. But as the celebration dies down, we should address what some may say are the “intended” consequences of this bill. It’s a godsend to the private insurance industry, and, further, it doesn’t just move the concept of a single payer Medicare for All program to the bottom of the policy heap, it actually dumps the heap into a shredder as the private insurance industry capitalizes on control of health care financing in America.

For providers who are celebrating, they should remind themselves of the pending automatic spending cuts in Medicare. Nice penalty for a job well done.

We really can fix this so everyone – the patients and their partners in the health care delivery system – can fare well. We merely need to enact and implement a single payer, improved Medicare for All program. Do you think we can get it done before the sunset of the two year provisions in the economic stimulus plan? It will be an uphill struggle when the Biden administration keeps dismissing us with the claim, “We’ve already fixed health care!” Yes, for the private insurers, but we can do much better by targeting the patients instead.

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By Ken Terry, David Muhlestein
Health Affairs Blog, March 11, 2021

Recently, a number of health policy experts have suggested that the best route to universal coverage might be to expand Medicare Advantage (MA) rather than enact Medicare for All—in other words, a private-sector instead of a government solution.

What We Know About Medicare Advantage

We know that MA enrollment is growing much faster than that of traditional Medicare. By the end of 2020, more than 40 percent of Medicare beneficiaries were enrolled in MA plans, and the Congressional Budget Office has forecast that 47 percent of beneficiaries will be enrolled in these plans by 2029. In short, we’re witnessing the rapid privatization of Medicare.

Why is this happening? Simply put, MA plans offer beneficiaries a better deal than traditional Medicare. Instead of having to buy a Medigap plan (at an average cost of $172 per month) to cover costs that traditional Medicare doesn’t cover, as well as a Part D prescription drug plan ($46), MA enrollees pay only a small monthly premium ($40 on average in 2019), and 56 percent of enrollees pay no premium on top of their Medicare Part B premium. In many plans, they get some level of dental, vision, and hearing coverage, which is missing in traditional Medicare. here’s also a statutory annual limit on out-of-pocket costs, which is not part of traditional Medicare.

On the other hand, MA networks are restricted, and some are very limited. MA enrollees who become seriously ill may have to pay hefty fees to out-of-network providers.

Enrollment in MA plans tends to increase by the age of beneficiary up through the late 70s and then decreases beyond that point.

We know that Medicare pays MA plans slightly more per enrollee than it pays for comparable traditional Medicare enrollees, after accounting for quality bonuses and diagnostic coding intensity. This intensity represents the additional diagnoses that many physicians document for MA members but not for traditional Medicare beneficiaries. MA plans have a financial incentive to ensure that their providers record all possible diagnoses, since higher enrollee risk scores result in higher payments to the plan.

The close correlation of MA payments to traditional Medicare spending is built into the program. “Currently, all savings to the [Medicare] program that come from MA must be generated through FFS [fee for service] spending reductions,” noted MedPAC.

MedPAC further commented that MA plans are expected to be more efficient than traditional, or fee-for-service, Medicare, because they actively manage care and have an incentive to keep costs down.

We know that per-enrollee costs for MA are rising much faster than per-enrollee costs in traditional Medicare. In 2019, per-enrollee MA costs grew 6.3 percent, compared to 2.4 percent for traditional Medicare. This was the fourth year in a row that MA cost growth per member exceeded that in the traditional program.

We know that MA is dominated by a few large companies, and that it is a profitable line of business. At the end of 2020, the four largest MA companies accounted for more than 60 percent of total enrollment, and the 15 largest accounted for more than 80 percent. MA has also been very lucrative for many private health insurers. Researchers from the Commonwealth Fund found that between 2016 and 2018, annual gross margins in the MA market averaged $1,608 per covered person, roughly double the insurers’ margins in the individual and group commercial markets.

What We Don’t Know About Medicare Advantage

We don’t know how to explain the faster per-enrollee cost growth in MA compared to traditional Medicare. But if overall cost growth were to blame, why didn’t per-beneficiary spending rise just as fast under traditional Medicare?

We don’t know whether or not MA offers better quality of care for beneficiaries than traditional Medicare. A number of studies suggest that it does. Overall, however, a “definitive finding [that MA offers superior quality] is not possible with currently available data,” MedPAC stated in 2019.

Another marker of quality is whether Medicare beneficiaries remain in MA plans when their health deteriorates. On this basis, there is reason to question whether MA plans offer higher quality. One paper found that MA members who had been hospitalized at least once had a higher rate of switching back to traditional Medicare than did other MA enrollees. The same was true for users of home care and long-term nursing home care.

While MA plans save money for beneficiaries, we don’t know whether they create savings for Medicare. As noted, the plans are paid, on average, slightly more than traditional Medicare spends on similar beneficiaries in the same region.

According to health insurers, MA plans spend 20 percent to 40 percent less on care than traditional Medicare does. The question is, if these plans are being paid at above Medicare rates, where does the rest of the money go? Some of it is being invested in extra benefits and reduced or zero plan premiums. All of that comes out of the 50–70 percent of the difference between a plan’s bid and its CMS-determined benchmark that CMS rebates to the plan. For many plans, a meaningful share of the savings consists of profits; there are also administrative and other overhead expenses, but it is unclear what factors explain the whole gap between rebates and plan savings.

Out-of-network physicians also must accept traditional Medicare rates. A study of payments to physicians for mid-level office visits and electrocardiograms found little difference between MA and traditional Medicare rates. What’s unclear is how much MA plans pay in-network doctors in quality bonuses and shared savings—not to mention risk contracts. Considering that MA network doctors have incentives to manage care and to code every potential health issue, they likely are receiving something beyond a flat traditional Medicare payment. Anecdotal evidence indicates that these bonuses can be quite substantial in some cases.

MA plans include health maintenance organizations and preferred provider organizations, both of which use standard managed care techniques to varying extents. Whether tools such as prior authorization and utilization review result in skimping on necessary care is unclear. While there is evidence of lower use of services in MA plans, compared to traditional Medicare, that doesn’t mean that the omitted services are necessarily of high value.

In conclusion, it is not clear that Medicare Advantage for All would help bend society’s cost curve more than Medicare for All or other policy proposals. In fact, the current evidence suggests that MA plans have not saved Medicare any money relative to traditional Medicare. To the extent that they lower costs, the lion’s share of those savings seems to be flowing to insurance companies, partly in the form of profits. Policy makers should consider whether this is the direction in which they want health care financing to go.

https://www.healthaffairs.org…

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Comment:

By Don McCanne, M.D.

For those who might be considering that private Medicare Advantage for All is a better way to go than single payer Medicare for All, you need only to read the concluding excerpt above: “In fact, the current evidence suggests that MA plans have not saved Medicare any money relative to traditional Medicare. To the extent that they lower costs, the lion’s share of those savings seems to be flowing to insurance companies, partly in the form of profits.”

Why would we want to keep the private insurers in the loop? Shouldn’t our funds all be spent on patient care instead?

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Bad news for one unlucky patient is also a stark example of how dysfunctional U.S. health coverage can be.

By Sarah Kliff
The New York Times, March 10, 2021

John Druschitz spent five days in a Texas hospital last April with fever and shortness of breath. It was still the early days of the pandemic, and doctors puzzled over a diagnosis.

They initially suspected coronavirus and hung signs outside his door warning those entering to wear protective equipment. Mr. Druschitz had already spent two weeks at home with worsening symptoms. He recalls one doctor telling him, “This is what it does to a person.”

Ensuing lab work, however, was ambiguous: Multiple molecular tests for coronavirus came back negative, but an antibody test was positive.

Doctors found that Mr. Druschitz had an irregular heartbeat and blood clots in both his lungs. They sent him home on oxygen, and ultimately did not give a coronavirus diagnosis because of the negative tests. He didn’t think much about the decision until this fall, when he received a $22,367.81 bill that the hospital has since threatened to send to collections.

Working with a patient advocate, he discovered that his debt stemmed in no small part from his diagnosis. Not having a coronavirus diagnosis disqualified his hospital from tapping into a federal fund to cover bills for people who do.

Mr. Druschitz ultimately fell slightly short of qualifying for multiple federal health programs that would have paid for his care if the details had been slightly different. Health policy experts see his experience as a case study in how easily patients can fall through the cracks of America’s fragmented health insurance system.

“It shows the insanity of having a health care system where literally the clinical diagnosis determines whether someone is going to get bankrupted,” said Dr. Ashish Jha, dean of the public health school at Brown University.

Mr. Druschitz was briefly among those uninsured millions. On the day the hospital admitted him, he was 64 years old, 23 days away from qualifying for Medicare. He had mistakenly terminated his private health plan, which he had purchased on the Obamacare marketplaces, one month early.

“It’s more likely than not that he did not have Covid, but it’s certainly not a zero chance,” Dr. Jha said. “The fact that it will end up making a big difference in the bill is really problematic.”

https://www.nytimes.com…

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Comment:

By Don McCanne, M.D.

Suppose we had one single national health program – a single payer Medicare for All – that covers you from conception to death. None of this would have been a problem for Mr. Druschitz. In fact, none of the other millions who have problems with their coverage or lack thereof would have such problems in the future.

There are now innumerable studies that show that everyone can have comprehensive health care without having to face financial barriers, and we are already spending enough to pay for such a system once we recover administrative waste and correct the other deficiencies in our financing system.

How many lessons do we need?

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Insights From Public Opinion Polls

By Robert J. Blendon, Sc.D.; John M. Benson, M.A.; Eric C. Schneider, M.D.
JAMA Network, March 5, 2021

As a result of the 2020 election, Democrats now have control of 3 bodies of national government: the presidency and both houses of Congress. But their margins in the Senate and House of Representatives are slim, which likely means very close votes on major legislation. In 2019, average Democrats differed from average Republicans in their views across 30 policy-related issues about what government should do in the future by 39 percentage points, more than double the gap in 1994.

Universal Coverage and National Health Insurance Reform

On the issue of universal health insurance coverage, the 2 parties’ constituents appear to be sharply divided. Nearly 9 in 10 Democrats (87%) (n = 703 surveyed) reported that they believe it is the responsibility of the government to ensure all individuals in the US have health insurance coverage, a view shared by fewer than 1 in 4 Republicans (23%) (n = 580 surveyed). Among Democrats, 75% reported that they prefer a health insurance system mostly run by the government, whereas 79% of Republicans reported that they prefer a system based mostly on private health insurance.

The same survey of 2150 individuals also addressed specific coverage proposals and found majorities of Democrats (n = 703 surveyed) expressed support for each of 3 options: building on the Affordable Care Act (ACA) (93%), Medicare-for-All (85%), and a Medicare buy-in to the ACA sometimes called “the public option” (82%). In contrast, only 30% of Republicans (n = 580 surveyed) expressed support for building on the ACA and 28% supported Medicare-for-All. While 62% of Republicans (n = 580 surveyed) reported that they support a Medicare buy-in to the ACA, that support does not represent an endorsement of the notion that government should ensure universal coverage. In addition, 64% of Republicans reported that they support replacing the ACA with a state-based private health insurance alternative compared with 36% of Democrats (n = 703 surveyed).

US Health Care System Reform

Currently, enthusiasm for broad reform of the US health care system is limited among both parties’ constituents. In a Gallup poll from June to July 2020, 55% of Democrats (n = 407 surveyed) and 53% of Republicans (n = 323 surveyed) indicated that they have a great deal or quite a lot of confidence in the current US medical system. About two-thirds of Democrats (68%) (n = 703 surveyed) indicated that they believe the federal government should be more involved in health care, a view held by only 17% of Republicans (n = 580 surveyed).

Race and Disparities in Health Care

65% of Democrats (5147 surveyed) reported that they believe Black people are treated less fairly than White people when seeking medical treatment compared with 11% of Republicans (4542 surveyed).

Potential Direction of US Health Care Policy

Because of partisan divisions in Congress, the administration will probably rely more on executive orders and administrative actions than legislative solutions to address these problems.

https://jamanetwork.com…

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Comment:

By Don McCanne, M.D.

It looks like the partisan divide is as bad as ever, with 75% of Democrats reporting that they prefer a health insurance system mostly run by the government, whereas 79% of Republicans reported that they prefer a system based mostly on private health insurance. The problem is that President Biden is more concerned about supporting the Affordable Care Act than he is about whether the insurance programs are public or private.

Although he does support the public Medicaid program, the conservative states remain resistant to it, so he is likely to depend more on the ACA marketplaces which are exchanges of private plans. The expanded health coverage under the American Rescue Plan is primarily an increase in government subsidies for the private health insurers.

There is a tremendous difference between the private insurers and the traditional Medicare program. An improved version of Medicare could be used to create a program that is universal, comprehensive, affordable for each of us by financing through equitable, progressive taxes and by avoiding excessive cost-sharing barriers to care, providing choice of health care professionals and institutions as opposed to choices in insurance products that limit care; that is, it would allow you to get health care whenever and wherever you need it. Private health plans would accomplish none of these goals, yet their current dysfunctions would continue to burden us.

The partisan divide theoretically has us aligned on one side that prefers a government-run program like single payer Medicare for All, and another side that has us aligned with the private health insurers and their dysfunctional programs. So why is the side aligned with the government – presumably Biden’s Democratic side – realigning itself with the private insurers on the Republican side? Didn’t the Democrats win, albeit by a very narrow margin? So why are the Democratic leaders moving into the Republican camp? Is neoliberalism the third force that is shifting the balance?

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By Sarah Kliff
The New York Times, March 5, 2021

Democrats spent much of the 2020 presidential primary debating the best way to expand public health insurance. They sparred over whether to enroll everyone in public coverage — the preferred policy of Senator Bernie Sanders — or to give everyone a choice to do so, the public option plan that President Biden supports.

The candidates repeatedly proposed a future in which private insurers play a diminished role in the American health system — or no role at all.

But the first major legislation of the Biden administration, if it passes in the Senate, moves in the opposite direction: It proposes spending billions to expand private health insurance coverage to millions more Americans.

The American Rescue Plan, a $1.9 trillion stimulus package that the House passed last week, would increase government subsidies to health insurers for covering recently laid-off workers and those who purchase their own coverage.

The decision to start with subsidizing private insurance shows how it can often be the path of least resistance when legislators want to expand coverage. The changes can slot neatly into a pre-existing system, and tend to garner support from the health care sector (which benefits).

The American Rescue Plan spends $34 billion expanding the Affordable Care Act subsidies for two years. The changes would make upper-middle-income Americans newly eligible for financial help to buy plans on the Obamacare marketplaces, and would increase the subsidies already going to lower-income enrollees.

The stimulus package also subsidizes private health insurance premiums for newly unemployed workers. The legislation that the House passed would cover 85 percent of COBRA premiums through September.

These policies have moved forward easily and with little opposition.

But some progressives have questioned the decision to route patients into private health plans, which will cost the government more because of the high prices they pay for care.

“I don’t think this was the most efficient way to do this,” said Pramila Jayapal, a Democratic congresswoman from Washington State, who is the lead sponsor of the House’s Medicare for All bill. She proposed legislation that would have allowed unemployed Americans transition to Medicare rather than staying on their former employers’ plans. This did not move forward.

In recent years, Democrats have increasingly embraced the idea of a large expansion of public health benefits. The public option would give all Americans the option to sign up for a Medicare-like plan, and a “Medicare for all” program would move everyone to a government health plan.

Polling shows public support for each idea also going up, with the public option tending to rank more favorably than Medicare for all.

In coming years, Democrats will probably confront more decisions about how to expand coverage. The new Affordable Care Act subsidies expire at the end of 2022, setting up a figurative cliff in which premiums would go back up if Congress did not act.

Democrats could use the moment to make those changes permanent, further solidifying the role of private health insurance. If enrollees find themselves satisfied with their increasingly subsidized plans — if they perceive the coverage as more affordable because the government pays a bigger share of the tab — the urgency to expand public coverage may lessen.

“It’s revealing that they’re sun-setting the expansion of subsidies, and not dealing with the longer-term challenge of how do you finance this,” Yale Professor Jacob Hacker said. “Their plan to bolster the A.C.A. is the path of least resistance, but it’s a path that only takes you so far.”

https://www.nytimes.com…

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Comment:

By Don McCanne, M.D.

Where is the roar?

Our health care system is the most expensive in all the world and yet in many regards performs poorly compared to other Western nations. Many of us supported a single payer, improved Medicare for All which would have repaired most of the defects in our system.

With a new administration we should expect great strides toward a high performance system. So what are we getting? Only more of the same and with a sun-setting provision at that. Should they enact a public option it would be only one more player in our fragmented, dysfunctional system of financing health care. Most of the advantages of a single payer Medicare for All are possible only if it is a single program and the other players, including the private insurers, are eliminated.

But no. We are attempting to enact a temporary program that would leave us no better off when it is terminated. We can’t just sit around until the program goes away. And further, we can’t just passively accept the fact that private insurance is here to stay and we’ll never have health care justice. It is time that they hear us roar, loud and clear.

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By Katherine Baicker, Ph.D.
JAMA, March 2, 2021

The importance of access to health care and the financial protections that insurance should provide have never been more salient, and the potential consequences of the costs and gaps within the patchwork system in the US have never been more dire. Would the US population be better off with a simple, single-payer, uniform Medicare-for-all type of insurance plan?

Trade-offs abound in policy decisions about health insurance. Although the advantages of moving to such a single-payer plan might be appealing, there are large hidden costs that must be considered.

First, having a single health insurance plan to cover the heterogeneous US population can actually make people worse off than tailoring the generosity of benefits to different people’s needs and preferences. In work I carried out with Mark Shepard, PhD, now at the Kennedy School at Harvard University, and Jonathan Skinner, PhD, at Dartmouth College, we highlight that the costs of having a uniform public insurance benefit have increased dramatically since Medicare’s advent in 1965.

One reason for the sharp increase in the costs of having a uniform public insurance benefit is the dramatic advances in health care within the last half century, with many more intensive—and costly—treatments now available. Providing all the care that might possibly be available is a much more expensive proposition now, necessitating forgoing many other things. A second reason is the substantial growth of income inequality. A person with a high income might be willing to devote resources to expensive care of only minimal health benefit, whereas a person with a lower income may need to devote those same resources to housing or education. A third reason is that, as tax rates have risen, the economic cost of raising funds to cover public insurance programs has become much larger.

All of this means that providing the same public insurance plan to everyone would leave segments of the population worse off. This could be higher-income groups, if the public benefit is limited and they are prohibited from going around it; or lower-income groups, if the benefit is comprehensive and too few resources are left to be devoted elsewhere. An alternative that might be better for everyone would be a basic public health plan available to all coupled with increased spending on other social insurance programs for lower-income groups, with the option to augment those benefits with privately purchased wraparound plans—more like the Medicaid-for-all who want it proposal.

A second factor in evaluating the costs and benefits of having a single plan is the trade-offs that are inherent to insurance plan design. Different people value different features in their health insurance, even if the overall generosity of the plan is held constant. Of course, most would prefer lower costs and broader coverage, all else being equal. Although most want the same care but at a lower price, lower cost sharing means higher premiums, whereas narrower networks can lower premiums.

Amitabh Chandra, PhD, at the Kennedy School and the Business School at Harvard University and I explored the answers given by a nationally representative survey sample about what features in a health insurance plan were most important to those surveyed, focusing on the trade-offs among elements such as lower co-payments, more expansive networks, lower premiums, and more comprehensive coverage. People were remarkably divided in their preferences about those dimensions, and given the option, they would make different choices about their insurance coverage.

The impetus for a single-payer plan is often not only the hope of reducing costs but also the goal of expanding coverage. The same survey suggests that altruistic concern for other individuals’ access to care, encouragingly, cuts across the political aisle. Faith in whether the government or the private sector is best able to effectively provide that care is much more sharply divided.

Another potential drawback of having a single plan is that competition among plans has the potential to drive down costs and accelerate innovation. This requires true competition within the insurer market, as well as among clinicians, hospitals, and other health care facilities, which is not the case in many parts of the country. There is genuine debate to be had about the potential for the introduction of a public option to increase choice and competition to promote higher value.

The costs of a single, expansive public program point to the potential benefits of giving enrollees a choice among insurance options—free or heavily subsidized for lower-income populations—to expand coverage while allowing people to make choices that reflect their priorities and drive value. There is an example along these lines in the Medicare Advantage system already in place, and most patients enrolled in Medicaid receive their insurance through privately managed plans.

None of this is meant to say that the current system is serving the US population well now. Individuals are paying more and getting less than they should—and this is particularly true for vulnerable populations. Instead, acknowledging the societal value of expanding coverage and increasing affordability, as well as the unavoidable trade-offs involved in the design of public programs, would move the country toward implementing a fiscally sustainable, high-value public insurance safety net.

https://jamanetwork.com…

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Comment:

By Don McCanne, M.D.

This article was selected because it represents the views of a respected and influential academic, Katherine Baicker, PhD, Dean of the University of Chicago Harris School of Public Policy. She says that there are large hidden costs in the trade-offs that we would have to accept in adopting a single payer Medicare for All program. We should try to understand what these trade-offs would be and what costs they would entail.

First she contends that covering everyone with the same plan could make them worse off because people have different needs and preferences. But that partially defeats the purpose of insurance which is to spread the risk amongst everyone (though we would add “equitably distributed”). We certainly cannot predict unknown risks in the future, and selectively covering pre-existing disorders also fails to spread the risk. Everyone should be covered for all reasonable services.

She states that the sharp increase in the costs of having a uniform public insurance benefit is due to the dramatic advances in health care, but that is not a unique feature of having a universal program. Everyone should be able to benefit from these advances, and an equitably-funded, universal risk pool makes that possible. Besides much of the increase in costs is due to price increases, and they are better contained in a public system.

She states that the substantial growth in income inequality might influence the willingness to devote resources to expensive care, suggesting that decisions would be based on the ability to pay. But a single payer system would obviate the need for such a two-tiered or multi-tiered system.

She states that higher tax rates would be needed because of the increased economic cost of raising funds to cover a public insurance program, but she doesn’t mention here the offset of a reduction in private spending. Besides, financing the system though progressive taxes is what makes the financing equitable.

She stretches logic when she says that the wealthy might be worse off if the benefits are too limited, while lower-income people might be worse off if comprehensive benefits result in fewer resources that could be devoted elsewhere. But all reasonable health care services would be covered, and the wealthy would be free to purchase whatever services are not included in the comprehensive benefit package. She suggests an alternative of establishing a basic public health plan for all with additional social insurance programs for those with low incomes and privately purchased wraparound plans for the wealthier, but this abandons the concept of single payer Medicare for All while perpetuating many of the deficiencies of the current system. (In my early novice years in health policy, I wrote a proposal for a basic public health plan with options to purchase additional coverage. Fortunately, Claudia Fegan was able to set me straight, and I got to work studying health policy, which I have continued to this day.)

She says that the hope of reducing costs while expanding coverage cuts across the political aisle, but there is a sharp divide in faith in whether the government or the private sector is best able to effectively provide that care. It is surprising to note the number of policy academics who are driven by faith in markets when the objective literature paints a clear advantage for government programs. Think of how many private insurance programs rely on public funds yet manage to divert significant amounts of these funds to their own industry. Sounds like greed-driven faith.

Confirming her belief in private markets versus the government, she touts competition of health plans, when what we need instead is cooperation within the health care delivery system. Single payer Medicare for All would promote the latter.

It is interesting that she closes by stating, “None of this is meant to say that the current system is serving the US population well now” and calls for “implementing a fiscally sustainable, high-value public insurance safety net.” Well, single payer Medicare for All would do that for everyone in a comprehensive system that we could afford as individuals and as a nation.

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We talked to Dr. Abdul El-Sayed about M4A and building a movement in the wake of Biden’s victory.

By Natalie Shure
The Nation, March 1, 2021

Even if the near-term dream of getting a Medicare for All (M4A) champion into the White House ended with the defeat of Senator Bernie Sanders’s 2020 primary campaign, the fight to win single-payer health care financing in the United States is far from over. The House and Senate M4A bills have over 100 Democratic cosponsors, and Congress’s insurgent left flank is growing.

Nonetheless, the path forward for any robust reform is challenging. Moderate congressional Democrats opposed to M4A still outnumber those in favor of it, and President Joe Biden is on their side.

But that’s no reason to despair, argue Drs. Abdul El-Sayed and Micah Johnson in their new book Medicare for All: A Citizen’s Guide.

Natalie Shure: You’ve stressed the importance of advancing the case for Medicare for All in the context of health care policy debates that are all but imminent with a slim Democratic majority under the Biden administration. How should Medicare for All advocates orient themselves toward incremental reforms, and differentiate between those that get us closer or farther from our goals?

Abdul El-Sayed: I have a pretty simple rubric: I ask myself, (a) Does it expand health care access generally? (b) Does it do so via public means? And (c) does it reduce the power and influence of health care corporations? If the answer to all three of those things is yes, then I support it. And if the answer to any of those things is no, I’ve got to take a far closer look, but usually I don’t. So, for example, take COBRA subsidies for people who have lost their employer-sponsored insurance. In theory, it’s going to extend health care access, but it does so by feeding money into the corporate health system, and doesn’t extend the footprint of public health care. So I don’t support COBRA subsidies: I think they fuel the brokenness of a system that does not do the job it’s supposed to do, which won’t address its own failures. Compare that to something like a public option—which, don’t get me wrong, has its real issues; but if you have a truly public public option that expands the footprint of public health care, expands health care generally, and reduces the power and influence of health care corporations, then I think it’s a plan we could get behind. But here’s the thing: We cannot accept that as the answer. We can accept that as a step toward the answer. I want folks to understand the difference. You can’t try to pitch it as the be all and end all of health care reform—only as a step toward a truly universal single payer system. But I’d rather take a step forward than a step back, and I’d rather take a step forward than staying where I am.

https://www.thenation.com…

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Comment:

By Don McCanne, M.D.

Incremental steps toward single payer Medicare for All reform have always been controversial. Medicare was to have been a first step toward universal health care, but, after over half a century, we still do not have universal coverage. Many hoped that the incremental changes in the Affordable Care Act would lead to universal coverage, but it has locked into place many of our profound deficiencies in health care financing and clearly needs to be replaced, rather than simply being tweaked further.

The immediate prospects for single payer reform are virtually non-existent. We have elected a president who is steadfastly opposed and is extracting from his potential cabinet members a promise not to advocate for single payer.

What do we do for the next four years? Above all, we should continue to educate and advocate for Medicare for All. Support is growing and will continue to grow as more people come to understand the imperative of the model. In the meantime, there will be opportunities for incremental advances. Incremental improvements could be beneficial, but they risk delaying the end goal of a universal single payer system because of the inertia that follows reform efforts.

It is important that any incremental measures would move us closer to the ultimate model. As Abdul El-Sayed says, interim measures should expand health care access, through a public process, while reducing the power and influence of health care corporations. Although he can support a properly designed public option, he makes clear that we cannot accept that as the answer, but only as a step toward the answer.

The question is, would it be possible to enact a public option that would be a step toward single payer? It would have to be designed much like current insurance products since the intent is that it would compete with private insurance. As an incremental step, it would have almost nothing in common with the desired end result. You couldn’t very well pay for it through equitable taxes and give it free to the recipients while others continue to purchase their insurance using premiums or forgone wage increases. We do not need another insurance product; we need single payer, improved Medicare for All.

So let’s not divert our energy toward incrementalism. We need to keep on with education, coalition activities, and grassroots efforts. Right now we need to target that toward Present Biden. If the nation demands Medicare for All, he’ll have to yield.

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Re: Chernew M, Cooper Z, Larsen Hallock E, and Scott Morton F. “Physician Agency, Consumerism, and the Consumption of Lower-Limb MRI Scans.” Journal of Health Economics. (2021).
National Institute for Health Care Management (NIHCM), March 2021

What This Study Found

• Patients often received their MRIs from higher-priced providers even when lower-priced options were available closer to home. On average, patients bypassed six lower-priced providers on their way to the higher-priced location.
• If patients spent no additional time traveling but selected the lowest-priced provider available, total MRI spending would be 36 percent lower. If patients extended their travel time to one hour to reach the lowest-priced provider they could cut overall MRI spending by 55 percent.
• Despite significant price variation and high cost sharing for MRIs, out-of-pocket costs had little influence on patient decisions about where to receive care. Fewer than one percent of patients used the price transparency tool to investigate MRI prices and compute their out-of-pocket costs for different providers.
• Referring physicians are the key arbiter of where patients receive care. Physicians tend to refer their patients to a very small set of imaging providers regardless of prices charged. As a result, to access lower cost providers patients must diverge from physicians’ established referral patterns.

What These Findings Mean

This analysis highlights the influence that referring physicians have over where patients receive care. Rather than price shopping for lower-limb MRI scans, patients appear to receive care at the usual locations to which their physician traditionally refers patients.

https://nihcm.org…

Journal of Health Economics: Chernew et al
https://www.sciencedirect.com…

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Comment:

By Don McCanne, M.D.

This reference is being used by NIHCM to support consumer-directed health care – having the consumer help to control health care spending by shopping for health care prices.

In this case it is shown that the patient will travel a further distance for a higher priced MRI if the physician has made the specific referral, when price shopping could save time and money.

But should price shopping really be the primary determinant in health care spending? Wouldn’t it be preferable to rely on the advice of your physician who is presumably making the referral based on quality, service, and the existence of an established, functional referral relationship?

In fact, this week I am scheduled for an MRI, and I will not be going to the closest facility, nor will I know the price that is being charged. Rather I have relied on my physician to make the right choice based on what he believes to be optimal management of my medical condition. I have no urge to price shop and then use that to override my physician’s recommendation.

If we had a single payer Medicare for All system, price would not be a consideration since it would automatically be determined by our public stewards and be set to be fair based on legitimate costs and an appropriate margin. I think the government can do a much better job of determining how we can get the best value for our $4 trillion national health expenditures than I could as a health care price shopper.

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