PNHP

Sacramento Bee attacks Schwartzenegger on "Socialized" Bogeyman

Sacramento Bee attacks Schwartzenegger on "Socialized" Bogeyman

Editorial: Socialized bogeyman

Government has real role in providing health care solutions for residents
Sacramento Bee
10-SEP-06

Careful, Gov. Arnold Schwarzenegger. Your ghostwriter seems to have just made you an opponent of Medicare.

The opinion piece in question was designed to detail your reasons for vetoing Senate Bill 840 by Sheila Kuehl, D-Santa Monica. SB 840 would have revolutionized the state’s health care system. Private insurers would have gone out of business. The state would have started paying directly for the health care of millions of Californians.

“I cannot support a government-run health care system,” you wrote (or, more accurately, someone wrote for you).

Hmm. So what exactly is Medicare? Or, more important, what are Republicans and Democrats really fighting about when it comes to providing affordable health care to more Californians, and how can anyone find the elusive political compromise?

SB 840 sought to create one payer of health care _ the state _ for residents of California. That would be the so-called “single-payer”
solution to our health care ills. The very term “single payer” tends to create political divides. And along those divides, the very real role of government in health care gets misunderstood.

“Socialized medicine is not the solution to our state’s health care problems,” wrote Schwarzenegger in vetoing SB 840. Actually, socialized medicine is as American as apple pie. No greater example is Medicare.

Medicare is essentially a single-payer form of health care. One payer _ the federal government _ provides the bulk of the funds to hospitals and doctors for the necessary care of millions of senior citizens.

Yes, those over the age of 65 pay part of the cost. Some can join HMOs as an alternative. But the federal government “runs” Medicare. And it also “runs” Medicaid (known as Medi-Cal in California), the single-payer program that underwrites care to the poor and disabled.

The political mainstream isn’t clamoring to get rid of those established forms of socialized U.S. medicine. So why do hard philosophical viewpoints suddenly emerge when the same solution is discussed for working Americans and their children?

Our problem with SB 840 was how the Democrats dangled it as veto bait from the get-go. No quest for common ground ever appeared evident, either by Democrats or Schwarzenegger. It was all about Democrats embracing government as the solution and Republicans denouncing it. In vetoing SB 840, Schwarzenegger followed the script.

Real progress in lowering health care costs and insuring more Californians will take a far more serious effort than the theater surrounding SB 840. It will start with the recognition that government is not the bad guy, and that government has an indispensable role in any solution.

Medicare Costs to Increase for Wealthier Beneficiaries

By ROBERT PEAR
New York Times
September 11, 2006

WASHINGTON, Sept. 9 — Higher-income people will have to pay higher Medicare premiums than other beneficiaries next year, as the government takes a small but significant step to help the financially ailing program remain viable over the long term.

The surcharge is a major departure from the traditional arrangement under which seniors have generally paid the same premium.

It is expected to affect one million to two million beneficiaries: individuals with incomes exceeding $80,000 and married couples with more than $160,000 of income. For individuals with incomes over $200,000, the premium, now $88.50 a month, is expected to quadruple by 2009.

The surcharge was established under a little-noticed provision of the 2003 law that added a prescription drug benefit to Medicare.

Supporters of the surcharge say it makes sense for wealthy people to pay more at a time when Medicare costs are soaring. But some Medicare experts worry that wealthy retirees will abandon the program and rely on private insurance instead, leaving poorer, sicker people in Medicare.

The premium in question is for Part B of Medicare, a voluntary program that covers doctors’ services, diagnostic tests and outpatient hospital care.

“The higher premiums could drive people with higher incomes out of Medicare,” said Samuel M. Goodman, a 73-year-old retiree in Derwood, Md. “Medicare would then become a welfare program, rather than a universal social insurance program, and it would be easier to attack.”

Federal officials have repeatedly said that Medicare is financially unsustainable in its current form.

Congress said the surcharge would “begin to address fiscal challenges facing the program.”

Joanne S. Shulman, who worked at the Social Security Administration for 35 years, said, “The surcharge will come as a shock to many people because they have not received any warning.”

Most beneficiaries now pay the same premium for Part B of Medicare. That amount has been increasing rapidly even without a surcharge. The standard premium has shot up an average of 12 percent a year since 2001, when it was $50 a month.

The premium is set each year to cover about 25 percent of projected spending under Part B of Medicare, which has been growing because of increases in the number and complexity of doctors’ services. General tax revenues pay 75 percent of the cost.

The Bush administration plans to announce the standard premium for 2007 later this month. In July, Medicare officials estimated that it would be $98.40 a month. The surcharge will be phased in from 2007 to 2009.

Here is how it will work: The surcharge for 2007 will be computed by the Social Security Administration, using income data obtained by the Internal Revenue Service from tax returns for 2005. If an individual has modified adjusted gross income of $80,000 to $100,000, the surcharge will be 13.3 percent, which adds about $13 to the monthly premium, for a total of about $111.50. For a single person with income of more than $200,000, the surcharge will be 73.3 percent, or about $72 a month, for a total premium of about $170.50.

When the transition is complete in January 2009, according to Medicare actuaries, the total premium for a person with income of $80,000 to $100,000 will be 1.4 times the standard premium. A person with income of $100,000 to 150,000 will pay twice the standard premium. A person with income of $150,000 to $200,000 will pay 2.6 times the standard premium, and a beneficiary with more than $200,000 of income will pay 3.2 times the standard amount.

If the basic premium rises 10 percent a year — a relatively conservative forecast — the most affluent beneficiaries will be paying premiums of more than $375 a month in 2009.

Under current law, the $80,000 threshold and the income brackets will be adjusted each year to keep pace with inflation, as measured by the Consumer Price Index.

President Bush recently proposed eliminating these annual adjustments, so that more people would pay a surcharge. “This change gives beneficiaries increased participation in their health care,” he said.

More than 40 million people are in Part B. Medicare officials estimate that 2 percent of them will have to pay a surcharge next year. The Congressional Budget Office says 5 percent of beneficiaries will be affected. The Social Security Administration puts the figure at 4 percent to 5 percent. Most people have their premiums deducted from monthly Social Security checks.

Fiscally conservative Republicans supported the surcharge. But so did some Democrats, who saw it as a progressive way to finance Medicare without cutting benefits or raising payroll taxes.

Senator Dianne Feinstein, Democrat of California, argued that “high-income beneficiaries can afford to pay a larger share of Medicare’s costs,” in part because Congress has cut their taxes in recent years.

The Congressional Budget Office estimates that the surcharge will raise $15 billion from 2007 to 2013.

Representative Nita M. Lowey, Democrat of New York, recently introduced a bill to repeal the surcharge, which she says will hit “more and more middle-class seniors.” Some advocates for older Americans, including the Senior Citizens League, with 1.2 million members, are lobbying for repeal.

A beneficiary can obtain relief from the surcharge by showing that the I.R.S. data was incorrect or that the person’s income declined because of a “major life-changing event” like the death of a spouse or the loss of pension benefits.

Theodore R. Marmor, a professor of political science at Yale, said the surcharge was more important for the politics of Medicare than for the financing of the program.

“The new income-related premium is fundamentally at odds with the premises of social insurance,” Mr. Marmor said. “Large numbers of upper-income people will eventually want to find alternatives to Part B of Medicare and will no longer be in the same pool with other people who are 65 and older or disabled. Congress will then have less reluctance to cut the program.”

The only health care solution: single-payer system

By Aaron E. Carroll, M.D.
The Indianapolis Star, Sept. 10, 2006
 
The new uninsured statistics released recently by the U.S. Census provide a sobering reminder of the failures of the U.S. health-care system. In Indiana the number of uninsured has risen to 871,000: Nearly one of every seven residents lacks coverage. Even for those lucky enough to be insured, ever-skimpier private policies helped push an estimated 28,000 Indiana families into medical bankruptcy in 2001.
 
As a physician who faces our state’s health care crisis day in and day out, I support a single-payer “Medicare for All” system for Indiana and for the nation.
 
Nearly everyone, regardless of ideology, agrees that reform to establish universal coverage is necessary. But the most important question is “how,” and here not all proposals are created equal. Because our current non-system is based on insurance companies whose natural market behavior is to compete to cover healthy people while shunning the sick, proposals that preserve our reliance on them are destined for failure:
 
* “Individual Mandates” (like the much-celebrated Massachusetts plan) simply force the poor and near poor to buy overpriced policies that offer grossly inadequate coverage, guaranteeing an epidemic of medical bankruptcies.
 
* Reforms which force employers to contribute more for coverage, encourage them to cut jobs, wages, or other benefits.
 
* “Consumer-directed” health plans are nothing but a euphemism for substandard coverage, offering families no protection in the event of medical need.
 
Other countries have figured out how to provide higher-quality coverage to all their citizens for far less than we spend. Recent studies have detailed how Brits and Canadians have lower rates of nearly every chronic disease and enjoy superior access to care. An exhaustive 2004 study of 21 international health quality indicators in five countries found that – despite double the outlay on health care – the U.S. performed noticeably better on only two.
 
How can the U.S. spend so much more and get so much less? Anyone who has ever had to deal with the nightmarish paperwork of giant insurance companies already knows the answer: It’s our reliance on private insurers.
 
Insurance companies stay profitable by keeping those who actually need health care from getting it. To do this, they erect a giant, expensive bureaucracy whose only purpose is to fight claims, issue denials and screen out the sick. They consume care dollars, but produce only paperwork headaches. Doctors and hospitals must maintain costly staffs to deal with insurance hassles, and businesses are saddled with the burden of administering their own health benefits. In total, this administrative waste consumes nearly one-third of our health spending.
 
Research has shown that streamlining payment through a single public payer could save the U.S. more than $350 billion per year. Such a system could have saved Indiana $6 billion in 2003. That’s $8,266 per uninsured resident, enough to provide high-quality coverage to everyone. Everyone would be covered for all doctor, hospital, long-term, mental health, dental and vision care, and prescription drugs. Patients would have free choice of doctor and hospital, and physicians would be unleashed from corporate dictates over patient care.
 
In the U.S. opponents resort to cries of “socialized medicine,” but don’t be fooled. In a “socialized” system (like the U.S. Veterans’ Administration) the government employs the doctors and owns the hospitals. In a single-payer system, they stay private.
 
Similarly, much hysteria has been printed about alleged “rationing” of care in other nations. The truth is that the U.S. rations care more harshly than any other country. According to the Institute of Medicine’s most conservative data, 18,000 Americans die every year due to lack of insurance. Millions more go without needed care due to cost. Now that’s rationing. What’s more, Canadians don’t even wait very long for care. The median wait time for non-emergency, elective surgery was four weeks in 2005. Service was so fast that in a recent survey only 3.5 percent of Canadians reported feeling they waited too long for care. Considering we spend twice what they do, a U.S. system should be able to eliminate waits entirely.
 
Single-payer offers the only real solution for Indiana and for our nation. It’s time for politicians to stand up to the insurance giants – as they have in California – in the interest of the public.
 
Dr. Aaron E. Carroll is assistant professor of pediatrics and director of the Children’s Health Services Research Fellowship at the Indiana University School of Medicine in Indianapolis.

BC/BS of Minnesota's individual mandate proposal

BlueCross BlueShield of Minnesota
Unfinished Business
A discussion paper on the need for universal health coverage in Minnesota

A Universal Coverage Model (a few selected features)

* A mandate for all Minnesotans to have coverage

* People who do not comply with the mandate to have coverage are subject to a “fair share” penalty based on income and related to what they would pay for coverage. As an added incentive to comply when the mandate takes effect, people who are noncompliant could be subject to a pre-existing condition limitation for a specified time period when they do apply for coverage.

* Enforcement through employers and the tax reporting system, with a mechanism created to which employers can refer their uninsured employees to asses subsidy eligibility or what their fair-share penalty is. Employers could then deduct this amount from payroll.

* All insurers doing business in the small and large group markets must participate in the individual market by offering at least three pre-defined products.

* Losses for insurers’ high-risk pool are subsidized through a fund that is subsidized by the state.

* Continued support for disease management programs

* Regulatory flexibility to allow for new benefit structures and cost-sharing models

* The proposal assumes a set of benefits for modeling purposes, but the ethical discussion of how a coverage mandate can be made affordable must be undertaken by all Minnesotans, to have a chance of successfully achieving universal coverage.

http://www.bluecrossmn.com/bc/wcs/groups/bcbsmn/@mbc_bluecrossmn/documents/public/mbc1_univ_cov_paper.pdf

And…

Will Mandatory Health Insurance Work?
by Greg Scandlen
National Center for Policy Analysis
September 6, 2006

Policymakers can get an idea of how well mandatory health insurance would work to reduce the number of uninsured by looking at another type of mandated coverage. Consider:

* All but three states mandate automobile insurance, but 14.6 percent of America’s drivers remained uninsured in 2004, according to the Insurance Research Council.

* No state mandates health insurance, but 17.2 percent of the population lacked health coverage in 2004, according to the Employee Benefit Research Institute.

…perhaps the biggest lesson from these comparative statistics is the success of a completely voluntary market. Not one state yet mandates health insurance, but people are covered anyway – at virtually the same rate as auto insurance.

States should not consider mandating the purchase of something unaffordable and inefficient before pursuing policies that make coverage more affordable for more Americans.

Conclusion. There are no easy solutions to America’s health insurance problem. The current notion that a state legislature can solve the problem through mandatory coverage is naïve at best and a distraction from the hard work of finding real solutions.

http://www.ncpa.org/pub/ba/ba569/

Comment:

By Don McCanne, MD

The BC/BS of Minnesota plan is obviously self-serving. It would expand their market to everyone, allow them to sell innovative plans with increased administrative income but decreased protection for patients, and would shift the losses of high-risk patients to the taxpayers. In this report, BC/BS specifically acknowledges the fundamental problem of all individual mandate programs: they have not been able to figure out the ethics of making an individual mandate affordable. Do they make insurance premiums affordable and expose patients to great financial risk? Or do they provide bona fide insurance coverage that many cannot afford, and then punish them for failing to buy it?

Greg Scandlen is an advocate of consumer-directed health care, especially health savings accounts and high-deductible health plans. Although we certainly disagree on our respective models of reform (single payer versus consumer-directed), we do agree that the concept of an individual mandate in the private insurance market should be laid to rest.

It's all about health information technology?

GAO (U.S. Government Accountability Office) September 1,2006 Testimony Before the Subcommittee on Federal Workforce and Agency Organization, Committee on Government Reform, House of Representatives Health Information Technology HHS is Continuing Efforts to Define Its National Strategy Statement of David A. Powner

In summary, Mr. Chairman, our work shows that HHS is continuing its efforts to help transform the use of IT in the health care industry. However, much work remains. While HHS, through the Office of the National Coordinator for Health IT and the American Health Information Community, has initiated specific actions for supporting the goals of a national strategy, detailed plans and milestones for completing the various initiatives and performance measures for tracking progress have not been developed. Until these plans, milestones, and performance measures are completed, it remains unclear specifically how the President’s goal will be met and what the interim expectations are for achieving widespread adoption of interoperable electronic health records by 2014.

http://www.gao.gov/new.items/d061071t.pdf

And…

Domestic and Offshore Outsourcing of Personal Information in Medicare, Medicaid, and TRICARE
GAO
September 2006
Report to Congressional Committees
Privacy

Federal contractors and state Medicaid agencies widely reported domestic outsourcing of services involving the use of personal health information but little direct offshore outsourcing. Among those that completed GAO’s survey, more than 90 percent of Medicare contractors and state Medicaid agencies and 63 percent of TRICARE contractors reported some domestic outsourcing in 2005.

However, some federal contractors and state Medicaid agencies also knew that their domestic vendors had initiated offshore outsourcing. Thirty-three Medicare Advantage contractors, 2 Medicare fee-for-service (FFS) contractors, and 1 Medicaid agency indicated that their domestic vendors transfer personal health information offshore. Moreover, the reported extent of offshore outsourcing by vendors may be understated because many federal contractors and agencies did not know whether their domestic vendors transferred personal health information to other locations or vendors.

In responding to GAO’s survey, over 40 percent of the federal contractors and state Medicaid agencies reported that they experienced a recent privacy breach involving personal health information. By survey group, 47 percent of Medicare Advantage contractors reported privacy breaches within the past 2 years, as did 44 percent of Medicaid agencies, 42 percent of Medicare FFS contractors, and 38 percent of TRICARE contractors.

http://www.gao.gov/new.items/d06676.pdf

Comment:

By Don McCanne, MD

As leaders in Congress and in the administration dodge the issue of their failure to address the real problems in health care, they frequently attempt to divert our attention by advocating for their surrogate solution for our health care problems: health information technology.

How serious are they? “Plans, milestones, and performance measures… have not been developed,” and it remains unclear how the goal can be achieved by 2014. And what we do have in place has been outsourced to private contractors, with over 40 percent reporting privacy breaches of personal health information.

Now that’s leadership!

Vermont Central Labor Council Endorses HR 676

Submits Resolution to State AFL-CIO Convention

Montpelier, VT The Washington-Orange-Lamoille Labor Council became the first in Vermont to endorse HR 676, single payer universal health care legislation introduced by Congressman John Conyers (D-MI). Representative Bernie Sanders, that state’s only member of the US House of Representatives, is among the 75 co-sponsors of HR 676.

The council’s resolution will be submitted to the state AFL-CIO convention which meets in mid September. Representative Sanders is expected to address the convention.

Currently, Sanders is running for the U.S. Senate. Single payer advocates in Vermont are working to persuade Sanders, who is leading in the polls, to agree to introduce a companion bill to HR 676 in the Senate once he is elected to that new position.

###

HR 676 now has 75 congressional co-sponsors in addition to John Conyers. It would institute a single payer health care system in the U.S. by expanding a greatly improved Medicare system to every resident.

HR 676 would cover every person in the U. S. for all necessary medical care including prescription drugs, hospital, surgical, outpatient services, primary and preventive care, emergency services, dental, mental health, home health, physical therapy, rehabilitation (including for substance abuse), vision care, chiropractic and long term care. HR 676 ends deductibles and co-payments. HR 676 would save billions annually by eliminating the high overhead and profits of the private health insurance industry and HMOs.

HR 676 has been endorsed by 175 union organizations including 39 Central Labor Councils and Area Labor Federations and seven state AFL-CIO’s (KY, PA, CT, OH, DE, ND & WA).

For further information, a complete list of union endorsers, or a sample endorsement resolution, contact:

Kay Tillow
All Unions Committee For Single Payer Health Care-HR 676
c/o Nurses Professional Organization (NPO)
1169 Eastern Parkway, Suite 2218
Louisville, KY 40217
(502) 636 1551, (502) 459-3393
Email: nursenpo@aol.com

The political reality of the California veto

Schwarzenegger runs no political risk by vetoing health care bill

By Dan Walters — Bee Columnist
The Sacramento Bee
September 6, 2006

The Public Policy Institute of California, in its most recent survey of the state’s voters, asked, “Which one issue would you most like to hear the gubernatorial candidates talk about before the Nov. 7 election?”

Immigration, especially illegal immigration, was the top response, but was mentioned by just 21 percent of the likely voters questioned, followed by public schools at 18 percent, jobs and the economy at 9 percent, the state budget deficit and taxes at 8 percent, and the environment at 6 percent.

Only 4 percent of voters contacted by the PPIC cited health insurance coverage — so few that they weren’t worth tabulating in the survey’s summary. And the same poll found that Republican Gov. Arnold Schwarzenegger holds a 13-percentage-point lead over Democratic challenger Phil Angelides.

The juxtaposition of those two poll results is this: Schwarzenegger runs almost no political risk by declaring, as he did Tuesday, that he’ll veto the latest version of universal health care enacted by a Democrat-controlled Legislature — which probably also explains why Angelides backed away from the measure even as he promised to pursue universal coverage if elected.

Schwarzenegger has not yet vetoed Senate Bill 840, but in an op-ed article published in the San Diego Union-Tribune, he declared that he would reject it, saying, “Socialized medicine is not the solution to our state’s health care problems,” and adding, “Such a program would cost the state billions and lead to significant new taxes on individuals and businesses, without solving the critical issue of affordability. I won’t jeopardize the economy of our state for such a purpose.”

SB 840, carried by Sen. Sheila Kuehl, D-Santa Monica, and backed by a broad coalition of health access and labor groups, would replace existing public and private health care programs with a single system operated by a new agency — and in the process more than double the financial size of state government.

The veto would not be unexpected, given the Schwarzenegger campaign’s unrelenting criticism of Angelides for supporting, in concept, universal health care, citing it as one example of the Democrat’s supposed eagerness to expand government and taxes.

Angelides’ circular positions, however, have been downright perplexing.
Earlier this year, while campaigning for the Democratic nomination, Angelides described universal health care as “my commitment.” While saying it should come from the federal government, he declared that “we’re not going to wait. We’re going to do it here in California, universal health care for every Californian, it’s my commitment to you.”

Angelides was even listed for a while as one of SB 840’s supporters, before formally declaring that he’s neither a supporter nor an opponent and refusing to say whether he would have signed SB 840 had he, rather than Schwarzenegger, been sitting at the governor’s desk. He recently described his position on SB 840 as “a moot point” because Schwarzenegger was likely to veto the bill, while still pledging to seek universal coverage if elected.

Why, one might wonder, is Angelides splitting semantic hairs? Health care is a shibboleth for liberal Democrats, so Angelides must endorse it, at least in concept, as he struggles to unify his party behind him. The PPIC poll found that just 58 percent of Democratic voters favored his election. But it’s not a burning issue, as the PPIC poll found, for the broader expanse of voters, perhaps because only a tiny percentage of those voters lack health coverage themselves. Therefore, the upside of endorsing the bill is not strong enough to offset the downside of giving Schwarzenegger’s campaign new ammunition to describe the Democrat as a tax-loving liberal who wants to double the size of state government.

That’s not to say, of course, that having about 6 million Californians — most of them from working poor families — without health care coverage is not a serious public policy issue. California, with its diffused, semi-seasonal economy and its multicultural, immigrant-heavy population, has an especially large proportion of medically uninsured. But as a political issue with the capacity to move voters, it doesn’t make the cut.

http://www.sacbee.com/content/politics/story/14318557p-15240808c.html

Comment:

By Don McCanne, MD

Those of us in the health professions who have watched so many suffer and die merely because of the flaws in our dysfunctional system of financing health care are greatly offended when we see that there is enough money already being spent to provide the care needed to prevent these adverse outcomes. Dan Walters is an astute political observer. The voters, most of whom have health insurance, aren’t moved by the tragic consequences of our flawed system. The truth hurts.

Is P4P about patients, or providers?

Exploring the Nexus of Quality and Cost

By Denise Remus
Premier
August 31, 2006

Executive Summary

This document describes analyses examining quality of care, patient outcomes and cost. The quality measures were collected as part of the Centers for Medicare and Medicaid Services (CMS) / Premier Hospital Quality Incentive Demonstration (HQID) project, a groundbreaking national pay-for-performance (P4P) project involving more than 260 hospitals. The HQID was designed to provide a combination of financial rewards and public recognition to hospitals that demonstrate high quality performance in caring for five clinical populations in the acute care setting. The purpose is to facilitate improvement in the quality and efficiency of patient care.

Participants in the project achieved statistically significant improvements in quality of care, as measured by thirty-three process and outcome measures, in the five clinical areas of:

* Pneumonia (PN)
* Coronary Artery Bypass Graft (CABG)
* Acute Myocardial Infarction (AMI)
* Hip and Knee Replacement Procedures (Hip/Knee)
* Heart Failure (HF)

While this demonstration project has shown that pay-for-performance programs have the potential to increase clinical quality and save lives, Premier was interested in examining whether higher quality of care could result in lower costs and improved patient outcomes. Earlier analyses focused on the relationship of quality and cost at the hospital level and minimal correlation was found. This study focused on quality, outcomes and cost at the patient level. The study found that patients who receive high quality care have fewer complications and fewer readmissions; significantly lower hospital costs, significantly shorter length of stay; and, for coronary artery bypass graft (CABG) patients, significantly lower mortality rates.

http://www.premierinc.com/p4p/press/quality-cost-methods-paper3.pdf

And…

Pay-For-Performance: Too Much Of A Good Thing? A Conversation With Martin Roland Interview

by Robert Galvin
Health Affairs
September 5, 2006

Abstract

As the United States moves down the road of pay-for-performance (P4P), concerns about unintended consequences are foremost in the minds of policymakers. Initial results from the world’s most ambitious P4P program, the United Kingdom’s Quality and Outcomes Framework (QOF), indicate that while quality improvements exceeded expectations, so too did the amount of funds paid out, straining the National Health Service (NHS) budget. Martin Roland, one of the leading U.K. health services researchers and an adviser to the QOF, gives his views on what went right and what went wrong, and he offers his advice to the United States about using financial incentives to improve quality.

>From the interview:

Galvin: One of the ideas to achieve budget-neutrality is that doctors with poor performance get paid less. What do you think of that idea?

Roland: Well, that’s inevitable in zero sum, isn’t it? Some get more, some get less, and the budget is overall neutral.

Galvin: It could play out that doctors get less of an increase versus an actual decrease. But either way, how do you think that this might affect doctors’ sense of professionalism?

Roland: Well, again, it’s much easier to give somebody a smaller increase than it is to reduce his or her pay. I think that most people in most jobs would find it pretty demotivating to get less pay. You can only introduce a zero-sum pay-for-performance scheme fast if you are prepared to have a substantial number of doctors losing significant amounts of money.

And…

Roland: I don’t think that providing health care is quite the same as manufacturing computers.

http://content.healthaffairs.org/cgi/content/abstract/hlthaff.25.w412

Comment:

By Don McCanne, MD

Pay for performance (P4P); what a simple concept. When the providers (physicians and hospitals) demonstrate higher performance on quality and costs, reward them with extra payment. To maintain zero-sum budget neutrality, fund those rewards with financial penalties against those with lower performance scores; that will motivate them to shape up.

But what have we learned from Premier? At the provider (hospital) level, there was only a minimal correlation between quality and cost. However, when assessed at the patient level, favorable correlations between quality, cost and outcomes were demonstrated. And isn’t health care really about the patient?

Is rewarding physicians for better performance measures a good idea? The British experience suggests that any financial rewards should be very modest, or spending will increase since you can’t bankrupt the portion of the system with lower scores. Physicians in difficult practice environments, facing chronic under-funding, poverty, poor patient compliance, and impaired access by patients, will have lower scores even though their actual performance may be superior. On the other hand, physicians in well-financed, uptown practices might well benefit from manipulations of their practice managers who develop expertise in making certain that the quality scores are optimal. P4P would shift funds from the former to the latter. Is that sound policy?

The field of medicine still stands apart. In the computer business, higher quality brings financial rewards. But in medicine, higher quality brings healthier patients. And penny ante rewards will never distract physicians from that sacrosanct obligation to try their very best to attain better health status for their patients.

Gov. Schwarzenegger announces veto of SB 840

Governor Schwarzenegger Announces Veto of Government-Run Health Care System

State of California
Office of the Governor
09/05/2006

Gov. Arnold Schwarzenegger’s statement:

I commend Sen. Sheila Kuehl’s commitment and dedication to providing health care coverage for all Californians, but I must veto SB 840 because I cannot support a government-run health care system.

Socialized medicine is not the solution to our state’s health care problems.

This bill would require an extraordinary redirection of public and private funding by creating a vast new bureaucracy to take over health insurance and medical care for Californians – a serious and expensive mistake. Such a program would cost the state billions and lead to significant new taxes on individuals and businesses, without solving the critical issue of affordability. I won’t jeopardize the economy of our state for such a purpose.

SB 840 relies on the failed old paradigm of using one source – this time the government – to solve the complex problem of providing medical care for our people. It uses the same one-sided approach tried in SB 2, the employer-mandated coverage measure signed into law before I became governor.

I opposed SB 2 because it placed nearly the entire burden on employers, and voters repealed it in 2004.

I want to see a new paradigm that addresses affordability, shared responsibility and the promotion of healthy living.

Single payer, government-run health care does none of this. Yet it would reduce a person’s ability to choose his or her own physician, make people wait longer for treatment and raise the cost of that treatment.

With my partners in the Legislature, I look forward in 2007 to working to develop a comprehensive and systemic approach to health care that not only provides affordable medical treatment to people when they are ill, but that
strives to make sure people don’t get sick in the first place. An approach
that supports cost containment and recognizes the shared responsibility of individuals, employers and government. That promotes personal responsibility and builds on existing private and public systems.

As part of this comprehensive approach, my administration already has worked hard on the fight against obesity, a leading cause of disease in this country.

I signed the landmark Healthy Schools Now Act, which bans junk food and sugar-laden drinks in public schools. Our budget also included $18 million to replace that junk food with fresh fruits and vegetables so we can start promoting healthy living choices for our youngsters.

On the question of access, I’ve made children’s coverage a priority, resulting in nearly a quarter million additional children covered by our Medi-Cal and Healthy Families programs.

And on the question of affordability, I reached agreement with the Legislature to provide discounts on prescription drugs of up to 60 percent for our neediest citizens.

But we’re not stopping there.

I convened a California Health Care Summit in July that for the first time brought together experts on all sides of this issue. At the table with us were representatives from academia, government, business, health care and labor.

From that summit and follow-up meetings, there emerged a strong sense of how to proceed on health care reform.

Affordability is the key to making our system work for everyone, and affordability is exactly what we are dedicating ourselves to.

By implementing a statewide plan advancing health information technology that I called for in a recent executive order, we can shave billions of dollars off healthcare costs in California.

By creating the 500 elementary school-based health centers I called for in our Health Summit, medical treatment will be more accessible to our children who need it most and they can avoid costly emergency care.

With the same willingness to compromise that we showed this past legislative session on issues like global warming, I know we can reach our goals. I look forward to working with Sen. Kuehl and other members of the Legislature, as well as the experts who participated in our summit and other stakeholders, to create a healthier California.

http://gov.ca.gov/index.php?/press-release/3751

Comment:

By Don McCanne, MD

(censored)

Follow the health care money

By Susanne L. King, M.D.
Berkshire Eagle,
Thursday, August 31

POWERFUL FORCES have been shaping the new mandated health care insurance bill being developed in the Statehouse in Massachusetts. I was reading a news article this week about health care lobbying in our state legislature, and was astounded by the sums of money being spent by special interest groups to ensure that the new bill will protect their specific interests; i.e. their profits.

For example, Blue Cross Blue Shield of Massachusetts spent $507,056 this year on lobbying, and the Harvard Pilgrim health insurance company was not far behind with $392,631. Other big spenders included Associated Industries of Massachusetts, and Partners Healthcare, the Boston hospital conglomerate.

But who lobbies for patients? Who lobbies for the policemen, firemen, and other essential city employees who are paying more and more for their health care, so that cost of living wage increases are being canceled out? Who lobbies for the increasing numbers of workers who pay for their own insurance premiums, as fewer employers offer health care benefits (down to 60 percent of employers in 2005, from 69 percent in 2000)? And who lobbies for those of us who pay our own health insurance premiums, and have watched them rise by double digits each year for the past five years?

The new mandated health insurance bill will be helpful to those who earn the least — $9,800 per year for an individual and $13,200 for a family, the federal poverty line. And if you earn up to three times the poverty line, you will qualify for a sliding scale subsidy from the government. However, whether the payments will be affordable for poor families, and what will be affordable for Massachusetts, is now the focus of intense debate within the Commonwealth Health Connector Authority board (a new state agency that will add yet more administrative cost to the health care system).

The state has budgeted $160 million for this mandated health care plan. Tapping into the free care pool fund has been suggested when this budget runs out, which is sure to happen. This means that hospitals, which rely on the free care pool for compensation for patients who don’t pay their hospital bills, will just have to make do or fold. This does not bode well for community hospitals, which don’t have the lobbying power of the large hospital conglomerates.

Meanwhile, we spend over $1 billion per week for health care in Massachusetts. That is $62.1 billion per year, 33 percent more than our national average, and more than other state or country in the world.

Where is all that money going? Certainly the health insurance industry’s expenditures for lobbying, paid for with our insurance dollars, increase administrative costs (which are 10 times higher than with the government-administered Medicare). And there are of course, the multi-million dollar salaries for CEOs, also paid for with our premiums. Health care lobbying not only drains our health care dollars, but also ensures that business as usual reigns in the health care world: powerful vested interests are trying to maintain an unsustainable status quo.

Fundamental change in the health care insurance system must occur. Single-payer health care would eliminate profits and the need for lobbying for those profits. (“Single-payer” means that health insurance is administered by the state government instead of multiple for-profit insurance companies). In addition to eliminating the profits of insurance companies, which are increasing the wealth of a few at the expense of the health of many, single-payer health care insurance would also eliminate the other administrative costs that make this system so much more expensive than Medicare.

With single-payer health care, for-profit insurance companies would not exist. Businesses would not have to support health insurance companies with their own hard-earned income, nor worry about health insurance expenditures for their employees. As a result, they could be more competitive in a world where every other industrialized country has single-payer, universal, government-administered health care, and doesn’t rely on employer benefits.

Every patient in a single-payer system — rich or poor, old or young, employed or unemployed, sick or well — would have comprehensive health care coverage, and would not have to worry about rising premiums, deductibles, and co-payments. Doctors would love the simplified paperwork, and have more time to spend with their patients, instead of dealing with insurance-related administrative tasks.

The new mandated health insurance bill is an attempt to provide universal coverage, but it does not address affordability, nor is it sustainable, either for the individual or for our state. And vested interests, which will profit from this bill, have helped to craft it through their lobbying efforts. If you are one of the many patients for whom no one is lobbying, you should call your legislator and let him know how the current mandated health care bill will affect you, and whether it represents progress in addressing your rising health care costs.

Of the candidates for the upcoming Democratic primary election for state Senator Nuciforo’s position, Chris Hodgkins is the long-time supporter of single-payer health care, and has promised he will work to make it a reality. He understands that single-payer health care is not just a single issue that benefits individual lives and livelihoods, but that it also would decrease the cost of doing business in our state and benefit our economy. Vote in the Democratic primary on Sept. 19 with this in mind!

Everyone wins when all pay in

Editorial

Rutland Herald, VT
September 3, 2006

A single-payer health care system would save the state $51 million a year, according to a new study carried out for the Legislature and released last week. It would achieve these savings by reducing the wasteful administrative costs that burden the present system.

The Legislature’s study provides welcome information, but it ran into immediate criticism from the business community and from the office of Gov. James Douglas. The hostile response by officials ready to denounce the idea of a single-payer system is an indication of the difficulties facing any proposal to put such a plan into effect.

Democratic proponents of health care reform are not ready to embrace a single-payer system. They understand the political difficulties and the economic uncertainties that remain. But at least, they are not closed-minded. The principles underlying a single-payer system are important to understand because they help set a direction toward the goal of universal access and cost-containment.

One of the important principles is shared risk. That is the principle behind all insurance, and it applies to health coverage that might be provided by the state. Shared risk means that the cost of health care is shared because we recognize that for most individuals the high costs incurred by most medical procedures are not affordable.

It is the same principle behind auto insurance. The high cost of an auto accident is likely to be unaffordable to an individual driver, so through a system of insurance we share the risk, knowing the driver having the accident may some day be any one of us.

At present the risk pool is limited to those with insurance, who pay high costs because their insurance premiums must incorporate the costs of care provided, often in haphazard fashion, to those without insurance. In a single-payer system, everyone would pitch in, and everyone would be covered.

Another advantage of a single-payer system would be its efficiency. As much as a third of medical costs at present go to the complex, wasteful process of tracking down insurance payments and fighting insurance companies who make their money by finding reasons not to pay.

Sharing the risk broadly would mean that those now enjoying a free ride would have to begin paying for health care. Many small businesses in Vermont do not offer health insurance, and paying the payroll tax needed to fund a single-payer system would be a significant new cost for them and their employees. On the other hand, employers who now offer insurance and their employees would see their costs fall when their present health insurance plans were replaced by a new payroll tax.

The study conducted by the Legislature by consultant Kenneth Thorpe describes this system, but legislative leaders know the state is far from adopting it. It would have its complications. It could not supplant Medicare and Medicaid, the federal programs for the elderly and the needy, and it would have to recognize the private plans of people from out of state receiving care in Vermont.

And there is the political resistance. As soon as the Thorpe plan was released, the Vermont Chamber of Commerce jumped on it, saying that it would “drown” the state in new taxes. Not mentioned was the elimination of the cost of health care premiums, which would actually save money for many businesses and individuals. A spokesman for Douglas also took a potshot at the Legislature, accusing it of looking for ways to raise the payroll tax.

It is apparent to Democratic legislators that paranoia about raising taxes, even if costs to businesses and individuals are lowered, is a political fact of life. Resistance to a single-payer system from the insurance industry and from businesses seeking to prolong their free ride will continue to be tenacious.

But it is useful to remind ourselves of the principles underlying a single-payer system as we move ahead with the reforms associated with the new Catamount Health plan. One question that emerged last week was whether people who leave jobs voluntarily would be eligible for the state-backed Catamount plan without a year’s wait. The state is arguing that barring them for a year was necessary to protect the solvency of the system. Legislators countered that covering them was essential to provide the seamless coverage that is the goal of Catamount Health.

Broad, seamless coverage is what a single-payer system is all about, and it ought to be a goal of less sweeping reforms as well. Locking people in unproductive jobs because they fear to go without health insurance is damaging to individual enterprise and to the state’s economy. Let’s cover everyone. Let’s eliminate unnecessary barriers to the health care that everyone deserves.

Speakout: Single-payer health care is way to go

By Drs. David Iverson and Elinor Christiansen
Rocky Mountain News
September 4, 2006f

The new uninsured statistics released Tuesday by the U.S. Census Bureau provide a sobering reminder of the failures of the U.S. health-care system. Here in Colorado the number of uninsured has risen to 788,000: nearly 1 of every 5 residents lacks coverage. Even for those lucky enough to be insured, ever-skimpier private policies helped push an estimated 14,000 Colorado families into medical bankruptcy in 2001. As physicians who face our state’s health-care crisis day in and day out, we support a single-payer “Medicare for All” system for Colorado and for the nation.

Misinformation abounds about countries with government-financed systems, which is why we were troubled to see Deroy Murdock’s column of Aug. 26, “Health-care horror,” featuring misleading, unsourced data pushed by an extremist think-tank. Despite the best efforts of such groups, real science – reviewed by scientists and published in academic journals – does exist. Its conclusion is clear: Even though they spend far less, countries with public health systems provide better quality health care, offer vastly better access, and ration care less than the United States.

Some of the most authoritative studies are worth reciting here:

* Americans are less healthy than the British. We have higher rates of cancer, lung disease and stroke. Americans have a 50 percent higher rate of heart disease and double the prevalence of diabetes. (The New England Journal of Medicine, May 3, 2006)

* Americans are less healthy than Canadians, with higher rates of nearly every chronic disease. This is in large part because Canadians have far superior access to health care: They were 33 percent more likely to have a regular doctor and 27 percent less likely to have an unmet health need. Americans were seven times more likely to report going without care due to cost. (American Journal of Public Health, July 2006)

* American care quality compares poorly against other countries. Of 21 international quality indicators studied by a team of distinguished researchers, the U.S. was superior on only two. Despite spending twice as much on health care, the U.S. performed at or below average on the rest. (Health Affairs, May/June 2004)

How can the U.S. spend so much more and get so much less? Anyone who has ever had to deal with the nightmarish paperwork of giant insurance companies already knows the answer: it’s our reliance on private insurers.

Insurance companies’ natural market behavior is to compete to cover healthy, profitable patients and shun those who are really sick. To do this, they erect a giant, expensive bureaucracy whose only purpose is to fight claims, issue denials and screen out the sick. They consume care dollars, but their main output is unnecessary paperwork headaches. It affects everybody: doctors and hospitals must maintain costly staffs just to deal with insurance hassles, and businesses are saddled with the burden of administering their own health benefits. In total, this administrative waste consumes nearly one-third of our health spending.

Research has shown that streamlining payment though a single public payer could save the U.S. more than $350 billion per year. Such a system could have saved Colorado $3.8 billion in 2003. That’s more than $5,500 per uninsured resident, enough to provide high-quality coverage to everyone. Everybody would be covered for all medically necessary services, including doctor, hospital, long-term, mental health, dental and vision care. All prescription drugs would also be covered. Costs are effectively controlled (as they are in other countries) by bulk purchasing of services.

Single-payer systems are often called “socialized medicine,” but don’t be fooled. In a “socialized” system (like the U.S. Veterans Affairs or Defense Department systems) the government employs the doctors and owns the hospitals.

In a single-payer system they stay private.

Much hysteria has been printed about alleged “rationing” of care in other nations. The truth is that the U.S. rations care more harshly than any other country. According to the Institute of Medicine’s most conservative data, 18,000 Americans die every year due to a lack of insurance. Millions more go without needed care because of cost. Now that’s rationing!

Single-payer offers the only solution for our state and for our nation. Let’s get there – it’s time.

Drs. David Iverson and Elinor Christiansen are members of Physicians for a National Health Program. Dr. Iverson lives in Denver and Dr. Christiansen is a resident of Englewood. The authors thank Nicholas Skala for his assistance in citation and editing.