PNHP

Public Utilities and Health Care

Public Utilities and Health Care

Greater Louisville Medical Society
President’s eVoice
April 3, 2008

What do you think would happen if the gas and electric company decided to raise rates to maximize profits for their executives and investors? What if that strategy resulted in 17 percent of the citizens not being able to afford gas/electric service or not being able to buy it because the company didn’t like how much gas and electricity you used?

How about if some people got special rates based on where they worked? What if you lost water, gas and electric service to your house if you quit your job? Except for the most hardcore libertarians or social Darwinists, I suspect the public and political response would be swift and definitive: there is something wrong about this.

Since the early 20th century, certain essential services such as power, water, waste management, transportation and communication have been considered “public utilities” that need to be governed and regulated for the good of the entire community. Some utilities are owned privately, some publicly. Utilities are governed by Public Service Commissions that regulate the rates and services of the utility and resolve disputes that arise.

Most of us are not happy when we open our gas/electric or water bill, but are generally satisfied that there isn’t overt profiteering. We generally agree that planning for future growth and development of necessary services should be based on the public good rather than just free-market economics. It is also reassuring that there is an arbiter to resolve disputes.

In this political season I cringe every time a pundit makes reference to health care reform proposals as “socialized medicine.” Do you fear “socialized gas and electric?” Although there are strong advocates for a single-party payer system, none of the major presidential candidates or political parties advocates this solution. However, any physician who has experienced the changes in health care delivery systems over the past generation has to have serious doubts about free-market solutions to the problem.

Some might argue that we already have some regulatory groups, e.g. FDA, licensure boards, state department of insurance, grievance and appeals procedures. A number of consumer and physician-led class action suits against insurance company practices have been successful, but these have required a great deal of time and effort. The “game” needs a referee to call “FOUL!” in real time.

Legislative attempts at regulation and reform have not been successful at either addressing the problem of the uninsured or containing costs. As we have seen in Kentucky, many insurers have simply moved out rather than comply with the new laws. There needs to be greater uniformity of rules and regulations, a national “level playing field.” For example, reforms such as guaranteed issue (the right to buy insurance, restriction of practice of re-underwriting by insurance companies) and benefits mandates (e.g., mental health coverage) can only be successfully implemented on a national level.

If we begin to consider health care as a public utility rather than a free market commodity or “industry,” we can move toward regulatory reforms that address the problems of the uninsured and the spiraling costs of medical care. We retain the benefits of private ownership and free market competition and innovation, as we see in the energy and other utility companies. At the same time, we acknowledge that access to affordable health care is a right of citizenship rather than a luxury item.

Sincerely,

G. Randolph Schrodt, Jr., MD
GLMS President

About Us
The Greater Louisville Medical Society is committed to helping doctors help patients.

GLMS Mission

– Promote the science, art and profession of medicine
– Protect the integrity of the physician-patient relationship
– Advocate for the health and well-being of the community
– Unite physicians to achieve these ends

An Evangelical from a Conservative Background, Dr. Rocky White is Not Your Typical Advocate for Single-Payer Healthcare

Democracy Now
NPR
April 21, 2008

Click here to listen to the interview.

While there are differences between the healthcare plans offered by Democratic presidential opponents Barack Obama and Hillary Clinton, neither of them is proposing a single-payer system of national healthcare. That’s despite the endorsement of precisely such a plan last December by the American College of Physicians, the largest medical specialty organization. We speak with Dr. Rocky White, a passionate, if unusual, advocate for a single-payer health insurance program. He describes himself as an evangelical from a conservative background and is on the Board of Directors of the nonprofit Health Care for All Colorado.

AMY GOODMAN: Democratic presidential rivals, Senators Barack Obama and Hillary Clinton, traded barbs over their healthcare proposals while campaigning in Pennsylvania this weekend. The rising cost of medical care has emerged as a key concern for voters, particularly as the economy continues to worsen. A new survey by the AFL-CIO found almost all of the respondents, most of whom were insured and employed, thought the current healthcare system is fundamentally broken and planned to vote for ways to change it in November.

This is an exchange between Clinton and Obama on healthcare from their debate in Los Angeles on January 31st that was hosted by CNN.

SEN. HILLARY CLINTON: We cannot get to universal healthcare, which I believe is both a core Democratic value and an imperative for our country, if we don’t do one of three things. Either you can have a single-payer system, or–which I know a lot of people favor, but for many reasons is difficult to achieve–or you can mandate employers–well, that’s also very controversial–or you can do what I am proposing, which is to have shared responsibility.

Now, in Barack’s plan, he very clearly says he will mandate that parents get health insurance for their children. So it’s not that he is against mandatory provisions; it’s that he doesn’t think it would be politically acceptable to require that for everyone. I just disagree with that. I think we, as Democrats, have to be willing to fight for universal healthcare.

SEN. BARACK OBAMA: What they’re struggling with is they can’t afford the healthcare. And so, I emphasize reducing costs. My belief is–is that if we make it affordable, if we provide subsidies to those who can’t afford it, they will buy it. Senator Clinton has a different approach. She believes that we have to force people who don’t have health insurance to buy it, otherwise there will be a lot of people who don’t get it. I don’t see those folks. And I think that it is important for us to recognize that if, in fact, you’re going to mandate the purchase of insurance and it’s not affordable, then there’s going to have to be some enforcement mechanism that the government uses. And they may charge people who already don’t have healthcare fines or have to take it out of their paychecks. And that, I don’t think, is helping those without health insurance. That is a genuine difference.

AMY GOODMAN: There are important differences between the healthcare plans offered by the Democratic presidential opponents, but neither of them is proposing a single-payer system of national healthcare. That’s despite the endorsement of precisely such a plan last December by the American College of Physicians, the largest medical specialty organization. The candidates’ refusal to consider such a proposal also flies in the face of the latest study indicating a majority of physicians, 59 percent, now support government legislation to establish national health insurance.

Today, I am joined by Dr. Rocky White. He is a passionate, if unusual, advocate for a single-payer health insurance program. He describes himself as an “evangelical from a conservative background.” He is on the Board of Directors of the nonprofit Health Care for All Colorado. Most recently, he revised and updated Dr. Robert LeBow’s classic book advocating single-payer healthcare. It’s called Health Care Meltdown: Confronting the Myths and Fixing Our Failing System. Dr. Rocky White joins us now here in Denver. He just came up last night from Alamosa, Colorado, where he lives.

Welcome to Democracy Now!

DR. ROCKY WHITE: Thank you, Amy.

AMY GOODMAN: It’s good to have you with us. We just drove through on our tour through New Mexico and Colorado–Alamosa yesterday morning–and were reminded of the problem with the water. Before we talk about healthcare, can you talk about what happened to Alamosa’s water?

DR. ROCKY WHITE: Well, several weeks ago, we started seeing sporadic outbreaks of salmonella in the community, and before too long, those sporadic outbreaks began to grow and grow. And it finally became clear that the salmonella was in the city water system. By the time it was all said and done, we’ve had about 300–I think I saw in the paper yesterday 385 cases now of salmonella. And just recently, we had one death. Thankfully, that’s all that we’ve had. But that’s basically what happened.

We really don’t know the source. We don’t know where the breach came from. We had a horrible winter. And so, it could have been just the freeze thaw from the exceedingly frozen ground, and then probably a breach somewhere with the high sublevels from the amount of snow that we’ve had. I suspect that’s probably where it came from, but I’m not sure we’ll ever know.

AMY GOODMAN: I had heard there was some pipe work that was being done and possibly a sewage pipe mixing with the water supply. Is that at all what could have happened?

DR. ROCKY WHITE: There’s a lot of theories out there. I’m not sure that we’ll ever know for sure. But the city was intending on chlorinating the water at some time in the future, but that future is now. So we now have chlorinated water in Alamosa.

AMY GOODMAN: And people are drinking it now?

DR. ROCKY WHITE: And people are drinking it now. You know, it was really tough, Amy, for a couple of weeks. People couldn’t take baths, couldn’t wash their dishes. And, you know, obviously the thing that happened there was the effect on the economy has been devastating. Most of the restaurants had to close down. People got laid off as a result. Then all the businesses downtown, their businesses dropped because the restaurants were closed. And I suspect by the time you think about all the money that’s been spent by the city, all the business that’s been lost and the tax revenues, it’s probably going to cost our community several million dollars by the time it’s all said and done.

AMY GOODMAN: I also understand –we stopped in at Adams State College–that the first government entity to come in when it was clear there was some kind of salmonella outbreak was the Department of Homeland Security.

DR. ROCKY WHITE: Yeah, that is correct. And I think, in some respects, well, the Department of Health is sort of tied to that. And I guess, in a way, this is sort of a homeland security issue, if you would, because the security of the people of Alamosa was in danger. And I think they’re trying to kind of tie those two together. That’s probably how that happened.

AMY GOODMAN: They weren’t concerned about al-Qaeda in Alamosa?

DR. ROCKY WHITE: No, we’re not concerned about al-Qaeda in Alamosa. But, you know, the FBI was there. You know, I think in these days, these times and days, I think people are just so paranoid that’s the first thing that comes to their mind.

AMY GOODMAN: Well, Dr. Rocky White, I want to talk to you about the Health Care Meltdown and about why you are taking on single-payer as your key issue. But first, we’re going to break, and we’re going to break back in New York: live in our studio, Sara Thomsen.

[break]

AMY GOODMAN: We’re broadcasting from Denver, Colorado. Our guest is Dr. Rocky White, an advocate for single-payer healthcare with an unusual background. Dr. White, why don’t you talk about that?

DR. ROCKY WHITE: Well, Amy, I grew up in Nebraska, and I came from a very conservative background, an evangelical background. All of my family members–you know, everyone was Republican, very conservative. And when you grow up in that environment, obviously that’s just something you just sort of adopt as you get older.

After I went through medical school, I intended on going back and practicing medicine in a rural area. And that is eventually what I did. I practiced in western Nebraska for a few years and then ended up in southern Colorado, going on thirteen years ago down in Alamosa. I joined a for-profit, fee-for-service organization down there. And, you know, of the twenty-three physicians that were my partners initially, it was a very conservative group. I mean, this was a fee-for-service group, hard-working. We had one Democrat in the whole group. So that tells you, you know, where we were at, where we stood politically.

But during the four, five years–well, actually, when I moved to the Valley, there were eleven full-time practicing internal medicine specialists at that time. That’s what I do, is practice internal medicine. Just to make a long story short, through the course–as the years went by, as we kind of entered into the new millennium, we started hitting on some very difficult times financially. And eventually we got to the point where we were just about to go broke, and we had to join forces with a hospital. Physicians came and went during those seven or eight years’ period of time. In fact, just in our group alone, there were thirty-four doctors who came and went just in about a seven-year period of time. By the time it was all said and done, when our group finally joined the hospital in 2004, just shortly thereafter, I was the only internal medicine specialist who was practicing full-time in the Valley at that point.

So if you go back to the early ’90s, as our group started to fall apart financially, I was very good at economics, I was very good at the business of medicine. I knew how to run a business, knew how to hire and fire, balance books, etc. I understood that part of the business of medicine. But I didn’t understand the bigger picture, and that is the policies that got us to where we’re at today. And as we started to fall apart, I started to study that and tried to understand what is so wrong with our group–or not just our group, but I began to see it was just the whole healthcare system as a whole, not just our group.

And as I began to study and to look at state policy and federal policy and going back–if you want to understand our healthcare system, you have to go back fifty or a hundred years to see how we evolved into this. You know, there wasn’t some mad scientist in the 1940s who devised this horrible system that we have today. It was just a matter of evolutionary process, so to speak. But as I began to study that and to try and assimilate what it was that was going on, I began to see some very disturbing trends. Part of the reasons that we got to where we’re at today are multiple. There’s not just one “this is what happened.” And as I started to weave that together, I began to say, “Jiminy Christmas! This thing is really screwed up!” And now I’m beginning to understand the healthcare system very well, not just our group, but as a whole.

And then I began to ask myself, what are we going to have to do to fix it? And so, obviously, single-payer was not even something that I would have even considered ten years ago. In fact, ten years ago I didn’t even know the word “single-payer” existed. And so, as I started to look at that and I looked at different ways that we could fix this whole thing–I mean, you talk about subsidies, expanding Medicaid, all of that–I began to realize that the only way that we’re going to fix this system is we’re going to have to put everyone on a Medicare-like system. In order to truly fix the system, we’re going to have to put everyone into one single risk pool, we’re going to have to share that risk, and the most efficient way to do that is through the tax system.

At that time, I didn’t know anything about Physicians for a National Health Program. I had never heard of Bob LeBow. In fact, the word “single-payer,” I hadn’t even heard that, you know, back in the late ’90s. And so, as I started to put all this together, I said, you know, I’m going to write a book about this. This is so important to do this.

And so, one day I was down at the emergency room, and one of my colleagues who’s sort of an old hippy from the ’60s, a very liberal individual, she knew how conservative I was, because at that time I was still a Republican. And I was very sheepish about the whole thing. I mean, here I am, a Republican, thinking about nationalizing healthcare. It just went against the grain of everything that I stood for. But you have to remember something, Amy: I didn’t come to those conclusions with lofty ideals of social justice. It was purely from an economic standpoint. This is the only way that we’re going to do–be able to fix this and do it efficiently.

So, as I started to talk to Beth, she said, “Rocky, have you ever heard of a group called Physicians for a National Health Program?” And I said, “No.” And so, she gave me the webpage, and I got on. And as I started looking at or reading the information that had been written by Steffie Woolhandler and Dave Himmelstein–I think you’ve talked to them before–looking at Bob’s book and things, I thought, “Criminelli! These people are thinking like I’m thinking!” This is–you know, I thought I was this crazy person out in the middle of nowhere coming up with this idea.

And so, that spring, there was a conference in Chicago that Ida Hellander was putting on with training people to be advocates for single-payer. And so, when I went out there, she introduced me to this book, Health Care Meltdown, that was written by Bob LeBow. And as I started going through it, it was sort of one of those Twilight Zone experiences, I guess, because it was really strange, because he had written my book. He had–I mean, even the chapters were very similar. And so–and I guess it’s not surprising, because when you start coming to these conclusions, you start thinking in the same lines. So I thought, you know, I’m not going to write my book; Bob LeBow already did this. I’m just going to get out there and start being an advocate and start speaking.

AMY GOODMAN: And Bob LeBow was president of Physicians for a National Health Program, ultimately was paralyzed in a cycling accident and died about five years ago?

DR. ROCKY WHITE: Yeah, that’s correct.

AMY GOODMAN: So you wrote the introduction to the new edition of Health Care Meltdown–

DR. ROCKY WHITE: Yeah.

AMY GOODMAN: Confronting the Myths and Fixing Our Failing System.

DR. ROCKY WHITE: Yeah, because that’s what’s so strange about that, is because I was up speaking in Idaho and got to meet his wife. And to make a long story short, Ida got a hold of Mrs. LeBow, Gail, and the two of them said, “You know, we’d really like to have Rocky write this,” because my background is so similar to Bob’s. In fact, Bob was a Republican and changed to a Democrat at about the same age that I did that. And Bob practiced rural medicine. He practiced to the underserved areas. He was very passionate about the uninsured, very similar to myself. And so, it was quite an honor when they called me and said, “Would you revise this and update this for the second edition?” And so, I did. I put an introduction in there, I updated all the numbers, brought it all up to date and then added two chapters to the book.

AMY GOODMAN: When you hear, for example, Barack Obama and Hillary Clinton debating healthcare, what are your thoughts? And explain what single-payer is.

DR. ROCKY WHITE: Well, single-payer can be a lot of things, but basically what single-payer means is that you have one organization that handles the financing of healthcare. That one organization could be a for-profit insurance company, if you only had one. It could be the government. It could be a public utility commission. So that’s all single-payer means.

The thing is, you know, you and I grew up in the same era. We have this idea about single-payer and socialized medicine sort of locked together. When I say the word “single-payer,” the first thing that comes into people’s minds is “Oh, my god! Social medicine? We get socialized medicine, and the next thing that’s going to happen is that the hammer and sickle is going to start flying from the top of the Capitol.” And so, when I explain to people that there are a lot of different types of single-payer systems–you could have purely socialized medicine. That’s kind of like what England has. The government owns the hospitals, the government owns the clinics, the government finances all the healthcare, and all the doctors work for the government. That is truly socialized medicine, as opposed to the Canadian system, where the financing comes through their Medicare program, but all the doctors are in private practice. And so, that’s kind of the spectrum, so to speak.

AMY GOODMAN: And when you hear the candidates debating healthcare, do you think that they really do differ? And why do you think they don’t go with this? Hillary Clinton started at the beginning–we heard the clip where she was talking about the options. She started by saying, well, single-payer is an option. Everyone–well, many people cheered in the audience, and she went on to say that wasn’t likely.

DR. ROCKY WHITE: Yeah. Well, I think that part of the problem is that our current healthcare system is so entrenched with the system that we have. We have this plurality of systems, where we actually have a single-payer system, which is Medicare, we have another single-payer system for Medicaid for the poor, and then we’ve got private insurance, which is a speckling of all kinds of crazy things. You know, this industry is a $2 trillion industry, and the profits in the for-profit insurance industry are so huge and it’s so deeply entrenched into Wall Street that people–this country is going to have a hard time extracting that. And I think that Barack Obama and Hillary Clinton understand that, and they don’t want to go ripping up this system for the sake of an ideal. But the fact of the matter is, is until we move to a single-payer system and get rid of the profit motive in financing of healthcare, we will not be able to fix the problems that we have. They will be impossible to fix.

AMY GOODMAN: What do you think is the single biggest misunderstanding about single-payer in this country, and what is your strategy for having it adopted? What do the polls in the United States show of how Americans feel?

DR. ROCKY WHITE: You know, it’s interesting. As you see the polls, as you’ve seen them move through from about 1999 up to the present, you’re seeing an ever-increasing number of people starting to support a national health program. And in fact there was a recent poll that came back from one of the medical associations back east and was just published in JAMA a couple of weeks ago.

AMY GOODMAN: The Journal of the American Medical Association.

DR. ROCKY WHITE: The Journal of the American Medical Association, which shows that 59 percent of practicing physicians today believe that we need to have a national health program. I mean, that’s unheard of, even ten years ago.

AMY GOODMAN: I mean, they were the biggest group opposed, because of the finances.

DR. ROCKY WHITE: Oh, I mean, that’s it. I mean, you know, physicians traditionally have been the group that has been the anchor sunk into the mud that has been dragging this whole healthcare reform process along. In fact, the AMA, the American Medical Association, launched a huge effort back in the 1960s to stop Medicaid and Medicare. And so, it’s amazing to see a new generation of physicians coming up who are disgusted with our current healthcare system. You know, we’re trained to be advocates of patients, we’re trained to save lives, we’re trained to practice medicine. And instead, what we’re doing is we’re practicing Wall Street economics. And they’re too diametrically opposed from the process.

AMY GOODMAN: So how do you inject this idea into the presidential debate?

DR. ROCKY WHITE: What it’s going to take is it’s going to take pressure from the bottom up. You know, I think that our current presidential candidates–I think both of them understand that ideally single-payer would be the best, but they don’t have the political will to move that forward. And so it’s going to take–I use it for this example. I say–you know, as the governor the State of Colorado or the president of the United States, their job is to feel which way the wind is blowing. Our job is to turn that wind.

And that happens by me coming down and speaking to you this morning. And I go out and talk to Kiwanis groups and Rotary groups. And especially the thing that I’ve been doing is going around and speaking with my fellow physicians, because it’s surprising how many doctors don’t even understand the system. I’ll have to admit that eight years ago I didn’t understand the system. And I think once people understand the system and understand what’s wrong with it, they’re going to do the same thing that I did.

AMY GOODMAN: The American College of Physicians has endorsed–this is your association?

DR. ROCKY WHITE: That’s my association of internal medicines. American College of Physicians, they gave a dual support, so to speak. They said if we’re going to fix the system, we either have to do this or this. And surprisingly, one of those was a single-payer system.

AMY GOODMAN: Well, I want to thank you very much for joining us. This is the beginning of a more extended conversation. C. Rocky White has been our guest. He has revised and updated the book by Robert LeBow, Health Care Meltdown: Confronting the Myths and Fixing Our Failing System.

The political rhetoric of "socialized medicine"

Poll Finds Americans Split by Political Party Over Whether Socialized Medicine Better or Worse Than Current System

Harvard School of Public Health
February 14, 2008

A poll by the Harvard Opinion Research Program at the Harvard School of Public Health (HSPH) and Harris Interactive:

Q. So far as you understand the phrase, do you think that if we had socialized medicine in this country that the health care system would be better or worse than what we have now?

Overall:
Better – 45%
Worse – 39%

Republicans:
Better – 17%
Worse – 70%

Democrats:
Better – 70%
Worse – 16%

Independents:
Better – 43%
Worse – 38%

Young adults (under 35):
Better – 55%
Worse – 30%

Seniors (65+):
Better – 30%
Worse – 57%

http://www.hsph.harvard.edu/news/press-releases/2008-releases/poll-americans-split-by-political-party-over-socialized-medicine.html

And…

Are We Heading toward Socialized Medicine?

By Stan Dorn and John Holahan
Urban Institute
April 2008

With health reform at the forefront of the national campaign, some charge that proposals to restructure our health care system represent dangerous steps moving the country towards government-run health care and socialized medicine. Similar rhetoric was heard last fall when President Bush vetoed legislation reauthorizing the State Children’s Health Insurance Program (SCHIP). We find this rhetoric inapplicable to both the SCHIP bill and proposals from most presidential candidates. The core issues in health reform involve, not the size of government, but proposals’ effect on the number of uninsured, access to quality care, cost growth, and consumers’ health care choices.

The U.S. Health Care System Today

Medicaid and Medicare cover 42.7 million and 42.4 million people, respectively, with some poor seniors and people with disabilities receiving coverage from both programs. The government also provides publicly funded health care to almost 9 million current and former federal employees and dependents through the Federal Employees Health Benefits Program; 3.7 million veterans who receive health care through the VA; and the country’s active-duty soldiers and their dependents. Only 5 percent of the insured population in the United States does not receive some kind of government subsidy, either directly or through a tax benefit.

Pending Proposals for SCHIP and National Reforms

Some single-payer proposals would go much further; an example is that advanced by Congressman Kucinich (HR 676). While health care providers would nominally remain private, the government’s authority would be so all-encompassing that the system would be the functional equivalent of socialized medicine.

Market-Oriented Proposals

Proponents of these market-oriented proposals agree that a strong public-sector role is appropriate if it accomplishes important objectives. That is why these proposals retain most functions served by government today and, in some cases, embrace aggressive new government interventions.

Many market-oriented proposals would create problems of quality and access to care for some people — the very problems some argue are characteristic of publicly run systems.

Conclusion

The core issue in health reform is not specifically the role of government, but what policies yield the best possible consequences for the American public. Such results include the number of people with health coverage, consumers’ quality of and access to necessary care, health care cost growth, and consumers’ ability to make choices about their health care and health coverage. Rhetoric about socialized medicine and government-run health care is a distraction from these much more fundamental concerns.

http://www.urban.org/UploadedPDF/411648_socialized_medicine.pdf

“What Is Socialized Medicine and Is It Relevant to Health Care Reform?” For a link to an audio webcast of this Urban Institute forum:
http://www.urban.org/Pressroom/otherevents/socmed.cfm

Comment:

By Don McCanne, MD

For political reasons efforts often are made to obfuscate the definition of “socialized medicine,” but it is important to understand the meaning of the term. A socialized medicine system is one in which the government is the owner of the health care delivery system, and professionals providing the health care are employees of the government.

In contrast, social insurance is a government insurance program which pays for health care provided by the private health care delivery system. Social insurance programs may be government-administered programs, such as the single payer model, or they may be contracted through private insurers. Do not confuse these private, non-profit insurers in social insurance programs with the model of for-profit private insurance in the United States. The private insurers in social insurance programs serve primarily as administrators, but the tightly-regulated financing system functions basically like the single payer model.

The Veterans Administration health system is government owned, and the professionals within the system are employees of the government. Thus it is a system of socialized medicine. Medicare is a government insurance program that pays for services in the private health care delivery system. Thus it is a program of social insurance.

Even Americans who believe they understand the term “socialized medicine” are often confused. In the Harvard/Harris poll, only 47 percent believe that the veterans health care system is a system of socialized medicine (it is). In contrast, 60 percent believe that Medicare is a system of socialized medicine (it is not).

Stan Dorn and John Holahan from the Urban Institute warn us that “rhetoric about socialized medicine and government-run health care is a distraction.” Yet they state that the single payer proposal of HR 676 “would be the functional equivalent of socialized medicine.” Well, they do have an agenda. They state that policies yielding the best consequences for the American public would include “consumers’ ability to make choices about their health care and health coverage.” Throughout their report are many other comments that make it clear that they support the Clinton/Obama model of choice of private insurance plans while rejecting the single payer model. It’s clear that they want to insulate the Democrats’ proposal against the inevitable “socialized medicine” attack of the Republicans. (It should be noted that the Republicans’ claim of private market solutions rings hollow when they propose expanding government subsidies to a population in which 95 percent of the insured are already receiving some form of public subsidies.)

We must continue to stand up against those who obfuscate the issues by abusing the political rhetoric over socialized medicine, especially so when they come from our own camp. They are correct when they say that it is the policies that count, but they are wrong when they reject policies, for political reasons, that would provide the greatest benefit for the patients.

The political rhetoric of “socialized medicine”

Poll Finds Americans Split by Political Party Over Whether Socialized Medicine Better or Worse Than Current System

Harvard School of Public Health
February 14, 2008

A poll by the Harvard Opinion Research Program at the Harvard School of Public Health (HSPH) and Harris Interactive:

Q. So far as you understand the phrase, do you think that if we had socialized medicine in this country that the health care system would be better or worse than what we have now?

Overall:
Better – 45%
Worse – 39%

Republicans:
Better – 17%
Worse – 70%

Democrats:
Better – 70%
Worse – 16%

Independents:
Better – 43%
Worse – 38%

Young adults (under 35):
Better – 55%
Worse – 30%

Seniors (65+):
Better – 30%
Worse – 57%

http://www.hsph.harvard.edu/news/press-releases/2008-releases/poll-americans-split-by-political-party-over-socialized-medicine.html

And…

Are We Heading toward Socialized Medicine?

By Stan Dorn and John Holahan
Urban Institute
April 2008

With health reform at the forefront of the national campaign, some charge that proposals to restructure our health care system represent dangerous steps moving the country towards government-run health care and socialized medicine. Similar rhetoric was heard last fall when President Bush vetoed legislation reauthorizing the State Children’s Health Insurance Program (SCHIP). We find this rhetoric inapplicable to both the SCHIP bill and proposals from most presidential candidates. The core issues in health reform involve, not the size of government, but proposals’ effect on the number of uninsured, access to quality care, cost growth, and consumers’ health care choices.

The U.S. Health Care System Today

Medicaid and Medicare cover 42.7 million and 42.4 million people, respectively, with some poor seniors and people with disabilities receiving coverage from both programs. The government also provides publicly funded health care to almost 9 million current and former federal employees and dependents through the Federal Employees Health Benefits Program; 3.7 million veterans who receive health care through the VA; and the country’s active-duty soldiers and their dependents. Only 5 percent of the insured population in the United States does not receive some kind of government subsidy, either directly or through a tax benefit.

Pending Proposals for SCHIP and National Reforms

Some single-payer proposals would go much further; an example is that advanced by Congressman Kucinich (HR 676). While health care providers would nominally remain private, the government’s authority would be so all-encompassing that the system would be the functional equivalent of socialized medicine.

Market-Oriented Proposals

Proponents of these market-oriented proposals agree that a strong public-sector role is appropriate if it accomplishes important objectives. That is why these proposals retain most functions served by government today and, in some cases, embrace aggressive new government interventions.

Many market-oriented proposals would create problems of quality and access to care for some people — the very problems some argue are characteristic of publicly run systems.

Conclusion

The core issue in health reform is not specifically the role of government, but what policies yield the best possible consequences for the American public. Such results include the number of people with health coverage, consumers’ quality of and access to necessary care, health care cost growth, and consumers’ ability to make choices about their health care and health coverage. Rhetoric about socialized medicine and government-run health care is a distraction from these much more fundamental concerns.

http://www.urban.org/UploadedPDF/411648_socialized_medicine.pdf

“What Is Socialized Medicine and Is It Relevant to Health Care Reform?” For a link to an audio webcast of this Urban Institute forum:
http://www.urban.org/Pressroom/otherevents/socmed.cfm

Comment:

By Don McCanne, MD

For political reasons efforts often are made to obfuscate the definition of “socialized medicine,” but it is important to understand the meaning of the term. A socialized medicine system is one in which the government is the owner of the health care delivery system, and professionals providing the health care are employees of the government.

In contrast, social insurance is a government insurance program which pays for health care provided by the private health care delivery system. Social insurance programs may be government-administered programs, such as the single payer model, or they may be contracted through private insurers. Do not confuse these private, non-profit insurers in social insurance programs with the model of for-profit private insurance in the United States. The private insurers in social insurance programs serve primarily as administrators, but the tightly-regulated financing system functions basically like the single payer model.

The Veterans Administration health system is government owned, and the professionals within the system are employees of the government. Thus it is a system of socialized medicine. Medicare is a government insurance program that pays for services in the private health care delivery system. Thus it is a program of social insurance.

Even Americans who believe they understand the term “socialized medicine” are often confused. In the Harvard/Harris poll, only 47 percent believe that the veterans health care system is a system of socialized medicine (it is). In contrast, 60 percent believe that Medicare is a system of socialized medicine (it is not).

Stan Dorn and John Holahan from the Urban Institute warn us that “rhetoric about socialized medicine and government-run health care is a distraction.” Yet they state that the single payer proposal of HR 676 “would be the functional equivalent of socialized medicine.” Well, they do have an agenda. They state that policies yielding the best consequences for the American public would include “consumers’ ability to make choices about their health care and health coverage.” Throughout their report are many other comments that make it clear that they support the Clinton/Obama model of choice of private insurance plans while rejecting the single payer model. It’s clear that they want to insulate the Democrats’ proposal against the inevitable “socialized medicine” attack of the Republicans. (It should be noted that the Republicans’ claim of private market solutions rings hollow when they propose expanding government subsidies to a population in which 95 percent of the insured are already receiving some form of public subsidies.)

We must continue to stand up against those who obfuscate the issues by abusing the political rhetoric over socialized medicine, especially so when they come from our own camp. They are correct when they say that it is the policies that count, but they are wrong when they reject policies, for political reasons, that would provide the greatest benefit for the patients.

ANA position on single payer

Health System Reform Agenda

American Nurses Association (ANA)
February 2008

Ultimately ANA supports a single-payer mechanism as the most desirable option for financing a reformed health care system.

http://nursingworld.org/MainMenuCategories/HealthcareandPolicyIssues/HSR/ANAsHealthSystemReformAgenda.aspx

Comment:

By Don McCanne, MD

The California Nurses Association/National Nurses Organizing Committee (CNA/NNOC) is a “leading national advocate for universal healthcare reform through a single-payer style system,” often joining with Physicians for a National Health Program (PNHP) in advocacy efforts for reform.

It is gratifying to see that the American Nurses Association (no relationship to California Nurses Association) also ultimately supports a single payer mechanism.

The American Medical Association (AMA) currently supports expansion of insurance coverage through income-adjusted public subsidies – an explicit support of a government role in the financing of health care. It should not be too great of a leap for them also to declare, ultimately, support of a single payer mechanism. The number of physicians currently supporting national health insurance already is much larger than the entire membership of the AMA.

Although mergers of these organizations would never be a realistic consideration because of other issues that separate them, nevertheless it would be nice to see the nurses and physicians of this nation unified in a single voice advocating for health care financing reform that would best serve the interests of our patients. We don’t have to love each other, but at least we could love our patients.

"Sick Around the World"

Can the U.S. learn anything from the rest of the world about how to run a health care system?

Reported by T. R. Reid
FRONTLINE
April 15, 2008

These foreign health care ideas aren’t really so foreign to us. For American veterans, health care is just like Britain’s NHS; for seniors on Medicare, like Taiwan; for working Americans with insurance, we’re Germany; and for the tens of millions without health insurance, we’re just another poor country. But almost all of us can agree that this fragmented health care mess cannot be ignored. The longer we leave it, the sicker it becomes, and the more expensive the cure.

To view “Sick Around the World” and for other resources:
http://www.pbs.org/wgbh/pages/frontline/sickaroundtheworld/

To view a KFF forum on “Sick Around the World” featuring Jackie Judd, T. R. Reid, Tsung-Mei Cheng and Uwe Reinhardt:
http://www.kaisernetwork.org/health_cast/hcast_index.cfm?display=detail&hc=2576

Comment:

By Don McCanne, MD

Washington Post reporter T. R. Reid takes a look at the health care systems of the United Kingdom, Japan, Germany, Taiwan, and Switzerland, and shows how each has settled on different models that are simpler, fairer, cheaper, and include everyone. He contrasts these nations with the United States which is “unlike every other country because it maintains so many separate systems for separate classes of people.”

Passionate single payer supporters (like me) might be disappointed (I’m not) to see that each of the other systems was touted as a definite improvement over ours, while single payer was not selected out as being superior to the rest. However, we are entitled to a certain level of smugness on observing the discussion, during both the program and the KFF forum, of Taiwan’s single payer system. From a pure policy perspective, it seems clear to me that single payer beats out the rest, even though all of the others are far better than what we now have.

The United States really can learn much by observing the application of health policies in other nations with less expensive, higher-performance systems. The first step is to better understand social solidarity.

“Sick Around the World”

Can the U.S. learn anything from the rest of the world about how to run a health care system?

Reported by T. R. Reid
FRONTLINE
April 15, 2008

These foreign health care ideas aren’t really so foreign to us. For American veterans, health care is just like Britain’s NHS; for seniors on Medicare, like Taiwan; for working Americans with insurance, we’re Germany; and for the tens of millions without health insurance, we’re just another poor country. But almost all of us can agree that this fragmented health care mess cannot be ignored. The longer we leave it, the sicker it becomes, and the more expensive the cure.

To view “Sick Around the World” and for other resources:
http://www.pbs.org/wgbh/pages/frontline/sickaroundtheworld/

To view a KFF forum on “Sick Around the World” featuring Jackie Judd, T. R. Reid, Tsung-Mei Cheng and Uwe Reinhardt:
http://www.kaisernetwork.org/health_cast/hcast_index.cfm?display=detail&hc=2576

Comment:

By Don McCanne, MD

Washington Post reporter T. R. Reid takes a look at the health care systems of the United Kingdom, Japan, Germany, Taiwan, and Switzerland, and shows how each has settled on different models that are simpler, fairer, cheaper, and include everyone. He contrasts these nations with the United States which is “unlike every other country because it maintains so many separate systems for separate classes of people.”

Passionate single payer supporters (like me) might be disappointed (I’m not) to see that each of the other systems was touted as a definite improvement over ours, while single payer was not selected out as being superior to the rest. However, we are entitled to a certain level of smugness on observing the discussion, during both the program and the KFF forum, of Taiwan’s single payer system. From a pure policy perspective, it seems clear to me that single payer beats out the rest, even though all of the others are far better than what we now have.

The United States really can learn much by observing the application of health policies in other nations with less expensive, higher-performance systems. The first step is to better understand social solidarity.

Health Spending By State Of Residence, 1991–2004

These data provide a baseline for studying impacts of states’ health reform efforts.

by Anne B. Martin, Lekha Whittle, Stephen Heffler, Mary Carol Barron, Andrea Sisko, and Benjamin Washington
Health Affairs

ABSTRACT: Differing trends in health spending by state underlie national spending trends. To shed light on the complexities of health spending patterns among state residents, we present updated per capita health spending estimates by state of residence for 1991–1998 and new estimates for 1999–2004, and we offer summaries of trends exhibited during these time periods. These statistics provide the opportunity for further analysis, such as examination of variations in state-level spending in Medicare, Medicaid, and total personal health care spending, which can yield new perspectives on recent state health spending trends and provide context for policy discussions.

Click here to read the entire study

[Health Affairs 26, no. 6 (2007): w651– w663 (published online 18 September 2007; 10.1377/hlthaff.26.6.w651)]

The Insur-Animals

The Insur-Animals bring to life the inane way the current health care system is run, exposing the obvious question — why do we to allow the current system of coverage to stay broken?

ACS testimony on underinsurance

Hearing on the Instability of Health Coverage in America

Statement of Stephen Finan, Associate Director of Policy, American Cancer Society

House of Representatives
Committee on Ways and Means
Subcommittee on Health
April 15, 2008

Little Help Available for Those with Inadequate Insurance

The stories we are giving you come from our Health Insurance Assistance Service (HIAS), which is a service offered through the American Cancer Society’s National Cancer Information Center (NCIC). HIAS is a free resource that connects callers with health insurance specialists who work to address their needs.

Conclusion

Much of the public debate today is about the need to cover the 47 million uninsured, and the American Cancer Society fully shares that concern. However, we need to recognize more fully the very significant problem of underinsurance. Health plans vary enormously in their deductibles, co-pays, benefits covered, and exceptions. Insurance plans are written in very detailed legalistic language that very few lay people can begin to comprehend, and the summary plan documents that are provided to enrollees almost never begin to convey the adequacy of coverage. Put another way, if you were to look at an array of plans that might be available to you as a consumer, and you were to ask, what would be the adequacy of your coverage if you were to be diagnosed with cancer or some other serious disease, you would probably conclude that you have no idea whether the plan would be adequate. As we see all too often in our HIAS cases, people often discover after their diagnosis what their plan really means — and that is a point where for most patients it is virtually impossible to change coverage.

Hearing Witness List and Testimony:
http://waysandmeans.house.gov/hearings.asp?formmode=detail&hearing=624

Testimony of Stephen Finan:
http://waysandmeans.house.gov/hearings.asp?formmode=view&id=6865

And…

Co-Payments Soar for Drugs With High Prices

By Gina Kolata
The New York Times
April 14, 2008

Health insurance companies are rapidly adopting a new pricing system for very expensive drugs, asking patients to pay hundreds and even thousands of dollars for prescriptions for medications that may save their lives or slow the progress of serious diseases.

Insurers say the new system keeps everyone’s premiums down at a time when some of the most innovative and promising new treatments for conditions like cancer and rheumatoid arthritis and multiple sclerosis can cost $100,000 and more a year.

But the result is that patients may have to spend more for a drug than they pay for their mortgages, more, in some cases, than their monthly incomes.

http://www.nytimes.com/2008/04/14/us/14drug.html?_r=2&hp=&oref=slogin&pagewanted=all&oref=slogin

Comment:

By Don McCanne, MD

To keep premiums affordable, the private insurance industry has no choice other than to pass more of the costs of health care on to individuals who have greater health care needs – thus the epidemic of underinsurance.

The current leading political proposals for reform call for using government policies and/or market forces to cover more of the uninsured with private health plans with affordable premiums. Since plans that would cover high-cost care, such as $100,000 drugs, are no longer affordable, underinsurance is rapidly becoming the standard in the private insurance market.

Covering the uninsured with private plans that do not prevent financial hardship is about like whitewashing a rotting picket fence. It might look prettier very briefly, but certainly not after it soon collapses.

Let’s do it right. Put away the whitewash. Let’s build a proper fence.

Health Plan Payments to Lobbyists Soared in 2007, Could Grow More in 2008

By Steve Davis
Managing Editor
sdavis@aispub.com

AIS’s Health Business Daily
Featured Story April 11, 2008
Reprinted from HEALTH PLAN WEEK, the industry’s leading source of business, financial and regulatory news of health plans, PPOs and POS plans.

Health insurers collectively paid more money to lobbyists in 2007 than they did a year earlier, according to disclosure forms made available last month by the U.S. Senate’s public records office (see table, below). Much of that money was spent to lobby lawmakers on issues related to Medicare Advantage (MA) and the reauthorization of the State Children’s Health Insurance Program (SCHIP). With both issues still unresolved — combined with the threat of health care reform under a potential Democratic president – industry observers say lobbyists might see even heftier paychecks this year from their health insurance clients.

“The number-one issue for health plans last year was payment under Medicare Advantage,” says Robert Laszewski, president of Health Policy and Strategy Associates, LLC, a policy and marketplace consulting firm based in Alexandria, Va. That issue, along with SCHIP, has been pushed forward and will continue to be a key topic for health plans and their lobbyists in 2008 and 2009, he adds.

Some lawmakers advocated legislation that would have used cuts to the MA program to fund SCHIP and to offset fee cuts to physicians in the Medicare fee-for-service program. While the legislation enacted late last year left MA payment intact, after heavy lobbying by health plans, cuts to the program have been proposed since then.

Although health insurers generally support an expansion to the SCHIP program, they oppose legislation that would cut MA spending to fund it, says Sara Rosenbaum, chair of the Department of Health Policy at the George Washington University School of Public Health and Health Services. Health plans will be spending to lobby in opposition to MA cuts again this year, she predicts.

Health Plans Target Medicare, Medicaid

Several insurers that rely on revenue from Medicare and Medicaid programs significantly boosted their lobbying budgets last year. Centene Corp., for example, spent less than $10,000 on lobbying in 2006, but paid $220,000 in 2007, according to documents filed with the Senate. The reauthorization of SCHIP was the only issue identified in the lobbying report filed by Centene.

WellCare Health Plans, Inc., which spent just $80,000 on lobbying in 2006, quadrupled its spending in 2007 to $320,000. More than half of that, $180,000, was paid to Washington, D.C.-based law firm Hogan & Hartson to lobby on Medicare issues, according to public records. Molina Healthcare, Inc., which paid $660,000 to lobbyists in 2007, said its top lobbying issues were MA, Medicaid funding and SCHIP reauthorization.

Health Plans Paid $22 Million to Lobbyists

HPW analyzed dollars paid to lobbyists by 15 health plan operators in 2006 and in 2007. Collectively, those firms paid more than $22 million in 2007 — up from $18 million in 2006 — to lobby Congress, the White House, CMS, the Congressional Budget Office as well as the departments of HHS, Labor and Transportation, and the National Economic Council.

UnitedHealth Group paid $4.56 million to its lobbyists in 2007 — up from $2.82 million spent a year earlier. Some of United’s top issues, according to its filing, included personal health records, Medicare advertising and genetic information non-discrimination. CIGNA Corp. also nearly doubled its lobbyist spending from $680,000 in 2006 to $1.22 million in 2007. Along with bills tied to MA and SCHIP, CIGNA’s lobbyists targeted a bill to protect health plan enrollees if a national insurer becomes insolvent.

Collectively, the nation’s Blues plans spent $9.8 million on lobbying efforts in 2007, which was a slight increase from the $9.5 million spent a year earlier. About $1.5 million of that was spent by WellPoint, Inc. Along with lobbying on MA funding and SCHIP reauthorization, the insurer also lobbied on issues related to industrial banks. That seems to have been money well spent. In September, the Federal Deposit Insurance Corp. approved WellPoint’s application to open an industrial bank that will be used to administer health accounts such as health savings accounts.

The trade association America’s Health Insurance Plans paid $6.9 million to lobbyists in 2007, which is slightly less than the $7.1 million it spent in 2006. In addition to bills that called for the expansion of SCHIP, AHIP lobbied in favor of legislation that would allow for the marketing of generic biotech drugs, and against MA payment cuts.

Fear of Reform Could Mean More Lobbying

Now that health reform has become a centerpiece of the Democratic presidential candidates’ platforms, 2008 is likely to be a bigger year for health insurance lobbying than 2007 or 2006, says Devon Herrick, senior fellow at the National Center for Policy Analysis. Moreover, both Sen. Barack Obama (D-Ill.) and Sen. Hillary Clinton (D-N.Y) favor guaranteed issue and community rating for health coverage, and both support an employer mandate (i.e., pay or play). And both candidates would work to expand SCHIP, he says.

Although health plans might spend more on lobbying effort in 2008 than they did the previous year, little is expected to be resolved. “We’re really treading water in 2008, but in 2009 the dam breaks loose” when a new president is sworn in, Laszewski says. “George Bush has said he will veto any changes to MA, but I doubt John McCain will be as strong of a defender of that program. And if a Democrat wins the White House, it’s game over” for MA. In 2009, major health reform will be the biggest issue for health insurers.

To access lobbying records, visit http://soprweb.senate.gov/index.cfm?event=choosefields

Money Paid to Lobbyists by Health Insurers and AHIP

Company or Association

Dollars Spent Lobbying in 2007

Dollars Spent Lobbying in 2006

Aetna Inc.

$2.09 million

$2.24 million

America’s Health Insurance Plans (AHIP)

$6.9 million

$7.1 million

AMERIGROUP Corp.

$220,000

$183,000

Blue Cross and Blue Shield plans*

$9.8 million

$9.5 million

Centene Corp.

$220,000

Less than $10,000

CIGNA Corp.

$1.22 million

$680,000

Coventry Health Care, Inc.

$690,000

$410,000

Harvard Pilgrim Health Care

$20,000

Not available

Health Insurance Plan of Greater New York

$120,000

$120,000

Health Net, Inc.

$1.22 million

$500,000

Humana Inc.

$683,074

$510,000

Kaiser Foundation Health Plan/ Kaiser Permanente Medical Group

$940,000

$657,500

Molina Healthcare, Inc.

$660,000

$420,000

Tufts Health Plan

$160,000

$80,000

UnitedHealth Group, Inc.

$4.56 million

$2.82 million

WellCare Health Plans, Inc.

$320,000

$80,000

*Includes WellPoint, Inc.

SOURCE AND METHODOLOGY: Compiled by AIS based on data from the Senate Office of Public Records and www.opensecrets.gov, March 2008.

Statement of Stephen Finan, Associate Director of Policy, American Cancer Society

Testimony Before the Subcommittee on Health of the House Committee on Ways and Means
April 16, 2008

Good morning, Mr. Chairman and distinguished members of the Committee. My name is Stephen Finan, Associate Director of Policy for the American Cancer Society. The American Cancer Society is a nationwide, community-based, voluntary health organization, dedicated to eliminating cancer as a major health problem by preventing cancer, saving lives, and diminishing suffering from cancer through research, education, advocacy, and services.

Thank you for inviting the American Cancer Society to testify. As you may know, ACS, and its sister advocacy organization the American Cancer Society Cancer Action Network (ACS CAN) are working together to elevate the issue of access to care and its impact on cancer patients and their families by educating the public and policymakers about problems in the health care system and the need for change. We look forward to working with this subcommittee as you work toward solutions to improve and expand access to quality care.

This morning you are listening to other speakers on the panel describe the problem of availability of health insurance. Although we fully share that concern, I would like to take this time to shed light on the under-appreciated, and at times overlooked, problem of adequacy of insurance. I would like to paint a picture — all too common in America — of how cancer patients and survivors with inadequate insurance face barriers and financial burdens in getting the quality health care they need to fight their dreadful disease.

Doreen’s Struggle with Inadequate Insurance Coverage

Let me begin our discussion of inadequate insured by sharing Doreen’s story with you. Doreen, a 57 year-old former medical office receptionist, was diagnosed with Stage IV breast cancer in the fall of 2005. The cancer metastasized to her spinal column, liver, lungs, and left femur. Doreen and her husband, a retired New York City police officer, have health insurance through his retirement plan. The insurance covers 30 outpatient visits a year, a number Doreen quickly exceeded after beginning treatment for her cancer. After she reached this annual limit, she was billed $5,000 a week for chemotherapy treatments. In less than a year, Doreen and her husband owed more than $100,000 to the hospital for her treatment. By the time Doreen’s insurance company informed her that she had exceeded her maximum number of outpatient visits, she had already made additional visits the plan would not cover. Fortunately for Doreen, she spoke at an American Cancer Society event about her inadequate insurance and the story ran in the Long Island Newsday. Upon reading the article, the insurer reversed the decision and paid Doreen’s medical bills in full. While Doreen’s story turned out well, countless others are not as fortunate to have a platform to share their story.

It was stories like Doreen’s and the countless stories of uninsured Americans’ struggle with this dreadful disease that brought the American Cancer Society to the conclusion that we had to enter the broader national debate about access to care.

Defining Adequate Health Insurance

As defined by the Society, adequate health insurance ensures timely access to the full range of evidence-based health care services (i.e., rational, science-based, patient-centered) — including prevention and primary care — necessary to maintain health, avoid disease, overcome acute illness, and live with chronic illness. These services include the complete continuum of evidence-based cancer care for treatment and support needs including clinical trials. Coverage should be comprehensive and protect the individual from incurring catastrophic expenditures.

Little Help Available for Those with Inadequate Insurance

The stories we are giving you come from our Health Insurance Assistance Service (HIAS), which is a service offered through the American Cancer Society’s National Cancer Information Center (NCIC). HIAS is a free resource that connects callers with health insurance specialists who work to address their needs. The specialists at NCIC handle inquiries about health insurance, coverage dynamics, and state programs — all specific to the caller’s needs. To date HIAS has captured almost 16,000 cases from 32 states, with plans to expand the program to other states.

The volume and type of calls received are captured as part of an internal database that allows for analysis of trends and emerging issues. While the database is not systematic or representative of all Americans, the volume and type of calls we receive identify serious problems that exist in our insurance system today. A recent analysis of the cases in the database revealed interesting information about cancer patients who have inadequate health insurance. In general, the Society is able to assist 1 in 6 cancer patients who contact HIAS about their health insurance problems. In the cases where we were unable to help the cancer patient, we can identify barriers in the current health insurance system facing cancer patients.

HIAS receives calls from individuals who are uninsured, those who are transitioning between plans, and cancer patients who are currently insured. Many of these callers are people who have been recently diagnosed or who are in treatment for cancer.

The problems we have specifically identified among those with inadequate insurance include:

* Annual or lifetime benefit limits within the plan that results in the patient not being able to access further cancer care without incurring medical debt.

* No or limited coverage within the plan for out-of-network specialists, limiting the patient’s ability to access quality cancer care.

* No or limited coverage within the plan for prescription drugs or treatments.

* Mounting, affordable co-pays or co-insurance.

For these callers, there is seldom help available to solve their problems. Unfortunately, there are few safety net options for the under-insured.

The biggest single issue is related to cost-sharing being too high. Nearly two-thirds (63%) stated cost-sharing as their primary reason to call HIAS. These callers had trouble meeting deductibles, paying their co-insurance for prescription drugs and treatment, and covering costs for physician visits and non-network specialty care.

Martha’s Financial Struggle With High Cost-Sharing

I would like to share a story from HIAS of a cancer patient who was insured and struggled financially because of the high cost-sharing for covered benefits. Martha, a 63 year-old retired woman, was diagnosed with Stage I breast cancer in November 2007. For her cancer treatment, Martha had surgery followed by radiation. Martha is now post-treatment, but still needs periodic follow-up visits to her oncologist to monitor for recurrence. Martha has a health insurance policy, but the policy is inadequate for her needs. For example, the insurance paid $1,000 of a $10,000 hospital bill for her surgery. Martha said she is $28,000 in medical debt due to her cancer diagnosis, and the hospital is threatening her with a collection agency. Martha lives in a state that has a medically underwritten individual insurance market, so it is unlikely she would be offered another policy. Martha beat her cancer, but now she is struggling with keeping her head above water financially.

Patients Interrupting Treatment Because of Inadequate Coverage

Some of the most disheartening kind of stories we hear come from people who have had to interrupt their treatment because of inadequate coverage. Nearly 900 of the cases logged in the last year have involved cancer patients interrupting their treatment, meaning they elect to stop their treatment before it has been completed. Please think about this for a moment — these are people who stop treatment for a deadly disease because they cannot afford to pay. The consequences of this decision could be detrimental to their health and may very well be a life or death situation.

Another common problem we see involves pre-existing condition restrictions on coverage. Although this is an access problem, it can also be viewed as an adequacy issue. If the caller has a current cancer diagnosis or a history of cancer, insurers may limit their coverage by imposing a pre-existing exclusion period. These exclusions eliminate all coverage for cancer-related health care for the duration of the exclusion period — usually 6-12 months, but sometimes permanently, depending on the coverage type. Pre-existing condition exclusion periods are a leading reason why HIAS callers do not enroll in coverage options available to them. They cannot afford to pay for premiums without receiving coverage for their cancer.

Let me share a story illustrating the adequacy problems related to the exclusion of pre-existing conditions. Thomas, a 35 year-old married father of three, was diagnosed with testicular cancer in March 2004. At the time, he was insured able to get the appropriate care to successfully treat his cancer with surgery and radiation. Thomas’ wife called HIAS because Thomas was without insurance and needed follow-up care to ensure his cancer remained in remission. Thomas could not receive the follow-up tests, which cost more than $2,500, without insurance or a means to pay. Since his remission, Thomas started his own business and lost his previous coverage. He attempted to get coverage in the individual market, but due to medically underwriting he was denied several insurance policies. Thomas was eligible for the state high risk pool; however, Thomas said the 12 month pre-existing exclusion period renders this option not viable. Thomas remains uninsured and unable to access the follow-up care to monitor his health.

Cancer and the “Under-Insured”

The problem of paying costly medical bills affects middle-class families, particularly those with chronic diseases such as cancer. Often insurance policy deductibles, co-payments and limits on health services may leave cancer patients without access to the timely, lifesaving treatment they need. Cancer patients may have to deal with major financial burdens because of out-of-pocket costs in addition to their cancer diagnosis. We receive calls everyday from cancer patients with these problems and published research is available that supports these problems of inadequate and unaffordable insurance as illustrated through the HIAS stories.

A recent study analyzing data from the Medical Expenditures Panel Survey (MEPS) shows the breadth of this kind of financial problem.[1] The MEPS household survey, sponsored by the Agency for Health Care Research and Quality (AHRQ), collects information from the non-elderly, non-institutionalized U.S. population. The survey asks American families questions about health insurance coverage, health care utilization, and health care expenditures. In this study, the researchers defined “under-insured” as people with insurance spending 10 percent or more of their tax-adjusted family income on health care services, including insurance premiums. Nearly 1 in 3 (28.8 percent) cancer patients who are insured have an out-of-pocket health care burden that exceeds 10 percent of their family income. More than 1 in 9 cancer patients with insurance have out-of-pocket health care burdens exceeding 20 percent of their family income in health care expenditures.

Cancer patients who have inadequate coverage have higher medical costs and must deal with the additional stress of financial instability. A survey of cancer patients and their families found that one in five cancer patients with insurance uses all or most of their savings when dealing with the financial costs of cancer.[2] Another study found that more than one in five people with chronic conditions have problems paying medical bills. Furthermore, the incidence of burdensome out-of-pocket spending among low-income, privately insured people with chronic conditions is rising dramatically.[3]

Medical debt has been an important cause of bankruptcy filing in the US. An analysis of national survey data found nearly six of ten adults who had current-year difficulty paying medical bills and 70 percent of those reporting medical debt said they were insured at the time their problems began.[4] Another study examined the causes of bankruptcy and found that 1.9-2.2 million Americans experienced bankruptcy related to medical problems in 2001.[5] Among those with illnesses that led to bankruptcy, their out-of-pocket costs average $11,854 and three-quarters had insurance at the time of their diagnosis.

Despite having insurance, many cancer patients and survivors experience major financial burdens. The situation of the “under-insured” is difficult to measure because wide variation exists among health insurance plans and people do not realize they are “under-insured” until they have a health crisis such as cancer. Furthermore, studies like the one I previously mentioned use a narrow definition to measure the number of “under-insured”–that is, they do not include those who stop or delay treatment because they will not be able to afford it. While we use these studies to talk about the “under-insured,” they do not fully capture the nature and extent of the problem.

American Cancer Society’s Commitment to Access to Care

Our testimony this morning focused on the issue of adequacy, but the American Cancer Society is also greatly concerned about the problems of the uninsured, which the other witnesses this morning are addressing.

We have made significant progress in recent years in addressing the cancer problem. Cancer death rates have decreased by 18.4% among men and 10.5% among women since the early 1990s. Despite this significant progress, the American Cancer Society realizes that its long-term goals of reducing the incidence and mortality of cancer cannot be achieved unless the gaps that exist within the current health care system are addressed. The challenge lies in the fact that our health care system is not up to the task.

A recent American Cancer Society study of 12 types of cancer among more than 3.5 million cancer patients dramatically demonstrates the problem of access today for uninsured cancer patients.[6] The study found uninsured patients were significantly more likely to present with advanced stage cancer compared to patients with private insurance. The study found consistent associations between insurance status and stage at diagnosis across multiple cancer sites. Compared to patients with private insurance, uninsured patients had significantly increased likelihoods of being diagnosed with cancer at more advanced stages. The greatest risk for diagnosis with moderately advanced cancer (stage II) instead of the earliest stage (stage I) was in colorectal cancer, while the highest risk for diagnosis at the most advanced stage of cancer (stage III/IV) was in breast cancer. The study shows that too many cancer patients are being diagnosed too late, when treatment is more difficult, more expensive, and has less chance of saving lives.

We know that individuals and families who are uninsured or have inadequate insurance often go without preventive care despite research showing that early detection and timely treatment are effective in improving outcomes.

We know that cancer patients who are uninsured or have inadequate insurance often do not receive necessary and appropriate treatment in a timely manner, and that they have worse health because of these problems.

And we know we cannot meet the American Cancer Society’s goals of reducing cancer mortality by 25 percent and cancer incidence by 50 percent by 2015 if we don’t achieve greater improvements in our nation’s coverage and health care delivery systems.

The recognition of these problems for cancer patients led the American Cancer Society to decide to enter the broader national debate on health care reform. Last year, the Society developed evidence-based principles defining meaningful health insurance to be adequate, available, affordable, and administratively simple without regard to health status or risk. These guiding principles, known as the 4As, are essential to any health care reform.

Conclusion

Cancer death rates are decreasing and we know what we must do as a nation to defeat cancer. Much of the public debate today is about the need to cover the 47 million uninsured, and the American Cancer Society fully shares that concern. However, we need to recognize more fully the very significant problem of underinsurance. Health plans vary enormously in their deductibles, co-pays, benefits covered, and exceptions. Insurance plans are written in very detailed legalistic language that very few lay people can begin to comprehend, and the summary plan documents that are provided to enrollees almost never begin to convey the adequacy of coverage. Put another way, if you were to look at an array of plans that might be available to you as a consumer, and you were to ask, what would be the adequacy of your coverage if you were to be diagnosed with cancer or some other serious disease, you would probably conclude that you have no idea whether the plan would be adequate. As we see all too often in our HIAS cases, people often discover after their diagnosis what their plan really means–at that is a point where for most patients it is virtually impossible to change coverage. As an appendix to my testimony, I am including additional stories that highlight the problems of the inadequately insured.

In adopting our principles for meaningful health insurance–our 4As–we said that adequacy should cover the full array of necessary services, from early detection through treatment and survivorship, but we did not attempt to define the specifics of an adequate plan. Rather, our goal is stimulate a public discussion that will lead to a broad consensus. We want to raise the issues through the campaigns this year and carry the discussion forward at the federal and state level as legislative reform efforts are developed. We believe the science and the knowledge exist to provide quality health care for all Americans, but we must work together to restructure our coverage and delivery systems to achieve that goal. Your hearing today is a valuable contribution to that discussion.

Thank you.