Willis Towers Watson, November 16, 2020

Individual coverage health reimbursement arrangements (ICHRAs), a new employer-sponsored health care benefit program for active employees that became available this year, are drawing the attention of U.S. employers, particularly wholesale and retail employers and those in education and the public sector. This is according to new research by Willis Towers Watson (NASDAQ: WLTW), a leading global advisory, broking and solutions company.

An IRS rule issued in 2019 opened the door for employers to begin offering ICHRAs this year. With an ICHRA, employees choose where their medical benefit dollars are spent by purchasing individual insurance coverage and then receiving a reimbursement through an employer-sponsored health reimbursement arrangement. The survey found growing interest in this new benefit as a way for employers to keep their costs fixed by giving employees the opportunity to manage their own health care benefit choices and spend.

According to the Willis Towers Watson 2020 Health Care Delivery Survey, about one in six employers (15%) is planning to offer or considering offering ICHRAs to at least some portion of its employees in 2022 or later. The survey results showed similar levels of interest regardless of employer size, with 20% of large employers planning to offer or considering offering ICHRAs to at least some portion of their active employees. In a further sign of support for ICHRAs, a forthcoming Willis Towers Watson survey of chief financial officers found one-third are considering ICHRAs for some portion of their active employees.

“Not surprisingly, relatively few employers adopted ICHRAs this year, as the pandemic diverted much of their attention to other critical benefit matters,” said John Barkett, senior director of policy affairs, Benefits Delivery and Administration, Willis Towers Watson. “However, we expect to see interest grow as companies learn more about ICHRAs and the market for individual health plans continues to grow more robust each year. ICHRAs may be a preferred option for companies considering offering health care benefits through a defined contribution approach personalized to each employee.”

The survey found nearly one in three (29%) public sector and education employers and almost a quarter (22%) of wholesale and retail employers are planning to offer or considering offering ICHRAs in 2022 or later. These sectors may be among the early adopters of this new benefit option, which affords employers greater ability to control costs and provides employees with more health benefit options than their employers offer today.

“ICHRAs may align well with employers rethinking their overall approach to benefits, especially in certain industries that have struggled with the challenge of providing competitive benefits that meet the diverse needs of their workforces under ever-increasing budget pressures. And as more employers adopt the ICHRA approach, employees could find relief from the burden of having to change plans whenever they change jobs,” said Barkett.

https://www.willistowerswatson.com…

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The Demise of the Defined-Benefit Plan

Investopedia, November 16, 2020

Key Takeaways

• Once common, defined-benefit plans in the private sector are rare and have been replaced by defined-contribution plans, such as a 401(k).
• Companies choose defined-contribution plans instead because they are less expensive and complex to manage than pension plans.
• The shift to defined-contribution plans has placed the burden of saving and investing for retirement on employees.

https://www.investopedia.com…

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Comment:

By Don McCanne, M.D.

That swooshing sound is that of our income and wealth rapidly shifting up to the top of the wealth ladder. It takes many forms, but one that has snuck in there is the demise of the defined benefit retirement plan – those plans that guaranteed a reasonable income throughout the retirement years. They have been replaced by defined contribution plans such as 401(k) plans, IRAs, or no plans at all. These plans shift much of the responsibility for funding retirement to the individual employees. Most of these plans do not have enough funds for a secure retirement, and if they are converted to an annuity to cover the full years of retirement, the amounts are almost never enough to live on, even with a Social Security check.

Switching from defined benefit to defined contribution has greatly reduced the employers’ costs of pension plans, but at a significant cost to their employees. The employers’ contributions are fixed whereas the employees must find ways to cover the higher balances of their retirement costs, including costs they may face merely because they live to their full life expectancy or beyond.

The defined contribution approach has worked so well for employers that they are now planning to expand that concept to individual coverage health reimbursement arrangements (ICHRAs). Under this scheme, courtesy of the Trump administration, the employers no longer contribute their full share of the costs of the employees’ health benefits (defined benefit), but, instead, they contribute a fixed defined contribution to the health reimbursement arrangement which is then used by the employee to purchase a plan from the private health insurance market. As if the employees’ current contributions weren’t already a financial burden, the amounts they would have to contribute for full service health plans would be much greater and would increase more rapidly since health care inflation would be passed on to the employees. They could purchase less expensive plans with spartan benefits, but then they would face financial hardship in the event of medical need, defeating the purpose of insurance.

(Incidentally, economists contend that the employers’ portion of the payment for health benefits is actually paid by the employees in the form of forgone wage increases. This reduction to a smaller defined contribution would give the employers the opportunity to prove this by providing the balance to employees in the form of wage increases. Don’t hold your breath waiting for it.)

This Willis Towers Watson report indicates that ICHRAs will be here in 2022. One-fifth of large employers intend to introduce them, and one-third of chief financial officers are considering them. Just as we saw the demise of employer-sponsored defined benefit retirement plans, we will soon see the demise of generous, defined benefit, employer-sponsored health plans, perhaps except for a modest 401(k)-type token defined contribution to the plans.

One of the strategies of the Affordable Care Act was to protect and perpetuate employer-sponsored health plans, but they are now on their way out. Do we really have to wait until tens of millions more face financial ruin because of the ever-increasing personal responsibility for health care costs? Is that swooshing sound going to be enough to placate us? Likely the bankruptcy attorneys may find it soothing.

By refusing to enact and implement single payer Medicare for All, who are we protecting? Those guys at the top who would have to pay more taxes, even though not enough to be able to feel the difference? It seems we should be protecting those who would be exposed to financial hardship should they need health care. Potentially, that’s most of us. The system is working for some, but it needs to work for all of us. We need to tell those at the top to take their defined contributions and shove them. Congress, working with the IRS, can let them and the rest of us know how much we really need.

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GAO, November 2020

What GAO Found

Enrollment in private health insurance plans in the individual (coverage sold directly to individuals), small group (coverage offered by small employers), and large group (coverage offered by large employers) markets has historically been highly concentrated among a small number of issuers. GAO found that this pattern continued in 2017 and 2018. For example:

• For each market in 2018, at least 43 states (including the District of Columbia) were highly concentrated.
• Overall individual and small group markets have become more concentrated in recent years. The national median market share of the top three issuers increased by approximately 8 and 5 percentage points, respectively, from 2015 through 2018. With these increases, the median concentration was at least 94 percent in both markets in 2018.

GAO found similar patterns of high concentration across the 39 states in 2018 that used federal infrastructure to operate individual market exchanges— marketplaces where consumers can compare and select among insurance plans sold by participating issuers—established in 2014 by the Patient Protection and Affordable Care Act (PPACA) and known as federally facilitated exchanges. From 2015 through 2018, states that were already highly concentrated became even more concentrated, often because the number of issuers decreased or the existing issuers accrued the entirety of the market share within a state. In 2017 and 2018 all 39 states were highly concentrated.

https://www.gao.gov…

Full report (59 pages):
https://www.gao.gov…

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GAO: Private health coverage remains concentrated among largest insurers

American Hospital Association, November 13, 2020

Enrollment in private health insurance plans remained concentrated among a small number of issuers in 2017 and 2018, according to a report released today by the Government Accountability Office. The three largest issuers continued to hold 80% or more of the large group, small group and individual market in at least 43 states, with 10 states seeing an increase in concentration in the individual and small group markets since 2011, GAO found. The Affordable Care Act requires GAO to report on changes in the concentration of enrollment among issuers in overall individual, small group and large group markets, and individual and small group exchanges.

“The GAO’s findings underscore concerns expressed by hospitals and health systems: highly concentrated insurance markets reduce patient choice, endanger patient care and increase their costs,” said Molly Smith, AHA’s vice president for coverage and state issues. “This allows health plans to adopt policies that benefit them financially and not patients. Such lack of competition encourages plans to pull a bait-and-switch on patients: delaying and denying medically necessary care that patients paid for through their premiums and changing coverage rules mid-year.”

https://www.aha.org…

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Fact Check: Does Joe Biden Want To Eliminate Private Health Insurance?

By Jocelyn Grzeszczak
Newsweek, October 23, 2020

“We have 180 million people out there that have great private health care, far more than we’re talking about with Obamacare,” Trump said. “Joe Biden is going to terminate all of those policies.”

Biden immediately shot down Trump’s claim, asserting that the reason he secured the Democratic Party’s nomination was because “I support private insurance.”

“Not one single person with private insurance would lose their insurance under my plan, nor did they under Obamacare,” Biden said. “They did not lose their insurance, unless they chose they wanted to go to something else.”

https://www.newsweek.com…

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Comment:

By Don McCanne, M.D.

In rejecting Medicare for All, President-elect Joe Biden says, “I support private insurance.” This GAO report is just one more factor that should make us question his wisdom on this topic.

The private insurance market is heavily concentrated and that concentration has increased with the implementation of the Affordable Care Act. As a representative of the American Hospital Association states, “highly concentrated insurance markets reduce patient choice, endanger patient care and increase their costs.” Further, “This allows health plans to adopt policies that benefit them financially and not patients. Such lack of competition encourages plans to pull a bait-and-switch on patients: delaying and denying medically necessary care that patients paid for through their premiums.”

Of course, single payer improved Medicare for All would ultimately concentrate health care financing into one single payer, but the difference would be that it would be our own payer, owned by the people, while returning to us the free choice that we want, the choice of health care professionals and hospitals that the private insurers take away from us.

The American Hospital Association understands the evil of concentrated health insurance markets, but they don’t seem to have much to say about the increasing market concentration of the hospital industry which we see has increased hospital prices.

Under single payer Medicare for All hospitals would be placed on global budgets, just like we do for fire departments. For those in the hospital industry who express concerns over global budgeting, maybe we should offer to nationalize the hospitals, creating our own national health service.

Regardless, we do have to get rid of the private insurance industry because they are out of control, and that harms too many of us.

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By Christina Zhao
Newsweek, November 10, 2020

Senator Bernie Sanders of Vermont, a possible Labor secretary candidate in President-elect Joe Biden’s administration, on Tuesday said public support for the Green New Deal and Medicare for All was won at the polls.

Sanders—who ran off the promise of universal health care and policies to combat climate change in the 2020 Democratic race—has insisted that widespread public support for the policies championed by progressives were apparent through the results of the presidential race.

“112 co-sponsors of Medicare for All were on the ballot. All of them won. 98 co-sponsors of the Green New Deal were on the ballot. Only 1 lost,” the senator tweeted. “Supporting Medicare for All and the Green New Deal is not just good public policy. It is also good politics.”

https://www.newsweek.com…

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Comment:

By Don McCanne, M.D.

Those who contend that Medicare for All caused a poor showing in the election are going to have to explain this one. All 112 co-sponsors of the Medicare for All Act of 2019 who were on the ballot won re-election!

Although many polls show support for Medicare for All, the one taken on election day is the one that really counts.

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By Michael K. Gusmano, Miriam Laugesen, Victor G. Rodwin, and Lawrence D. Brown
Health Affairs, November 2020

Abstract

Although the US has the highest health care prices in the world, the specific mechanisms commonly used by other countries to set and update prices are often overlooked, with a tendency to favor strategies such as reducing the use of fee-for-service reimbursement. Comparing policies in three high-income countries (France, Germany, and Japan), we describe how payers and physicians engage in structured fee negotiations and standardize prices in systems where fee-for-service is the main model of outpatient physician reimbursement. The parties involved, the frequency of fee schedule updates, and the scope of the negotiations vary, but all three countries attempt to balance the interests of payers with those of physician associations. Instead of looking for policy importation, this analysis demonstrates the benefits of structuring negotiations and standardizing fee-for-service payments independent of any specific reform proposal, such as single-payer reform and public insurance buy-ins.

From the Introduction

The rising costs of US health care make affordability—for consumers, employers, and governments—an elusive goal. Studies show that these expenditures are higher in the US than other countries not because the volume of service is higher but because prices are higher. One reason for the higher prices in the US is that private insurers typically do not have sufficient market leverage to control them, and there are dramatic price variations in the private market. Medicare has done better at controlling prices than private insurers have, but Medicare is limited by Congress in the degree to which it can negotiate prices.

In most countries with universal health insurance, physicians are paid on a fee-for-service basis, yet prices there are lower than in the US. As Miriam Laugesen and Sherry Glied explain, “Higher fees, rather than higher practice costs, volumes, or tuition expenses, are the main driver of higher US spending.”

Representatives of systems with universal health insurance explain that their health systems reflect an enduring commitment to solidarity. Their position reflects the insistence that health care is a human right and a continuing affirmation of redistribution and reciprocity as a central element of social justice.

In this article we explore how three countries—France, Germany, and Japan—appear to achieve economic sustainability in a fee-for-service system. We then identify the institutional processes that influence the prices of physician services in universal health insurance systems. These countries have all attempted to contain rising health care costs by negotiating prices with physician associations and adapting fee-for-service to the evolution of health care provision.

In the US, in contrast, insurance regulation is less developed and has suffered from a lack of national uniformity. Because there is no universal health insurance, public programs including Medicare and Medicaid address the gaps in coverage.

Summary of the approaches

The three countries we examined all negotiate fees in the context of expenditure constraints, but they have contrasting institutional processes to address health care prices and volumes. France has negotiated prices aggressively but has few controls over the volume of care. Germany controls service volume indirectly by imposing budget caps on sickness funds and physician associations and putting them in charge of enforcing volume controls.

Japan’s approach is more centralized, with a complex set of conditions that govern how and where health care services can be provided. These conditions are specified in the same document that lists the negotiated fees for each service. The aim is to constrain volume by limiting the volume of services billable for each item and by limiting the number and types of hospitals, clinics, and physicians that are allowed to provide particular services.

Although France and Germany hold physician fees at lower levels than in the US, both countries pay specialists more than primary care physicians. These fee schedules reflect a bias for more technical or procedural services over services such as office visits in primary care. In contrast, Japan, uniquely, pays private office–based generalist physicians, represented by the Japan Medical Association, more than academic hospital–based specialists.

From the Discussion

The health systems we studied focus on controlling prices in the context of fee-for-service medical practice and national expenditure constraints that do not result in withholding health care from the population. The use of fee-for-service physician payment does create problems, but marking fee-for-service as the major cause of high health care spending in the US is problematic, especially as countries with lower prices and expenditures use fee-for-service systems. France, Germany, and Japan limit the incomes of physicians by standardizing and adjusting the fees they are paid while using a variety of approaches to limit the volume of services provided.

The diversity of payment arrangements in the US acts as a constraint on unified approaches while also creating growing pressure to change and standardize fees. Although some Democratic leaders in Congress emphasize the buying power and leverage of a single-payer health care system to contain prices, extending Medicare to all legal residents would introduce challenges in negotiating prices with hospitals, pharmaceutical manufacturers, and physicians within the context of US institutions. Perhaps the most important implication of our study is that regardless of whether either fundamental changes such as Medicare for All or incremental expansion of the Affordable Care Act are proposed, both would oblige policy makers to think hard about how to set prices and oversee service volume.

Although France, Germany, and Japan vary in their approaches to regulating prices and service volume, all three rely on centralized fee negotiations. This general approach is evident in some Democratic health reform proposals, some of which have proposed empowering the secretary of health and human services to create a national fee schedule for payers and providers within a public option or Medicare for All design.

The experiences of these countries suggest that changes in physician reimbursement policy need not presuppose widespread changes to coverage and vice versa. Both become more interdependent when governments are committed to providing universal and affordable health insurance coverage. Health care pricing is an important pillar supporting and upholding universal coverage. Even without universal coverage, the US can and should regulate how much discretion providers of health care services have in setting their own prices. Standardization of prices can reduce treatment and administrative costs alike.

Americans should work within their institutional framework to allow for greater standardization of prices based on negotiation. Such an approach would be a shift away from the current system, in which payment negotiations lack transparency. The absence of arrangements similar to those in the three countries we have studied leaves payers fragmented and gives providers too much control over their own prices.

The purpose of international comparisons for policy learning is not to transplant or import foreign systems into domestic institutions. The US lacks a solidaristic vision—the population is distributed across separately regulated private insurance plans, and programs designed for different groups remove a shared identification, balkanizing the system of health care. Our approach to understanding physician payment policy across nations acknowledges the absence of solidarity in the United States. Price negotiations must reflect the history and distinct characteristics of each country.

Cross-national comparisons, however, offer perspective on the challenges that Americans confront and the ways in which experience abroad might be adapted to the specificities of other national institutions. The ways and means by which France, Germany, and Japan are “getting the price right” should not be ignored by US policy makers concerned with universal health insurance or with the incremental extension of affordable health insurance coverage.

https://www.healthaffairs.org…

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Comment:

By Don McCanne, M.D.

Health care spending is highest in the United States, and a major reason for this is our very high prices. The private insurance industry in the United States has not been particularly effective in controlling prices, and our government has largely limited its control of prices to public programs such as Medicare and Medicaid, though, even there, the government has refused to control Medicare drug prices. The authors use the examples of the universal programs in France, Germany and Japan to show how governments can get the price right.

The authors contend that we do not have to enact a Medicare for All system to control prices. But when you look at our fragmented health care financing system and the free rein that the private sector is allowed – especially the private insurers – it does not take too much imagination to see that trying to implement fee controls across the entire system would be much like herding cats. The fact that the crisis has been with us for many decades without any real progress being made in price controls, outside of Medicare and Medicaid, demonstrates that these cats are not very herdable.

Essentially all other nations have been effective in controlling spending through control of prices, and we could be too, but it sure would be a lot easier if we had a well designed, single payer, improved Medicare for All. That way we would be standardizing prices in a system based on solidarity.

Why solidarity? The current political turmoil should provide us with enough evidence that we sure could use an infusion of a whole lot more solidarity. Just our lack of solidarity in managing the COVID-19 pandemic is causing suffering, economic hardship, and loss of lives, simply because we have prioritized political squabbles over solidarity. Let’s give solidarity a try – for our health.

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Healio, November 10, 2020

POINT by Benjamin Sommers, M.D., Ph.D.

Yes.

A public option can improve health care affordability with continued private insurance and better access to quality providers, but only if the design is set up in a way that provides more financial protection upfront. You could also push private insurers to do this, but a public option is a better vehicle to make sure the cost-sharing terms are affordable for patients.

Many individuals who are currently insured in the marketplace have high deductibles — up to several thousand dollars in some cases. This leaves many people paying out of pocket for their care unless they get critically sick.

If the public option aggressively negotiates payment rates to providers, it will bring down the overall costs, as is the case with Medicare and Medicaid. There is a trade-off because it could possibly limit the number of providers but, on the other hand, it would save the whole system money.

There are a lot of varieties of public options. The one from the Biden campaign is for patients not in Medicaid expansion states. This would help patients who are too rich for Medicaid but too poor for the marketplace. Those people — and there are a lot of them — have fallen through the cracks.

This could also help patients in places where there is limited competition, which leads to higher premiums. Creating more competition brings down the costs.

However, there isn’t a magic number when, once hit, suddenly everyone is able to afford care and be covered. Every step taken squeezes people out. The only way to get everyone insured is through a single-payer system but, even then, it has to be more generous than the current Medicare plan. That being said, there doesn’t seem to be the political will or leverage to implement that.

The Medicare component of the public option is popular, but it also has substantial cost-sharing; about 20% in most cases. That’s why there are supplemental plans.

The U.S. Congress — Democrats and Republicans alike — gives away benefits with a value that substantially exceeds what the users pay. Each beneficiary on average receives $310,000 more in benefits than they pay. The unpaid bills — $37 trillion at last count — have been kicked down the road to future generations in the form of bigger federal deficits. The Galen Institute reports that Medicare’s annual deficits are responsible for one-third of U.S. federal debt.

Yet, Medicare’s enormous scale confers genuine administrative and purchasing efficiencies. Medicare spends up to seven times less than private insurers on administrative costs. It also pays hospitals 40% less and providers 2 to 3.5 times less than private insurers pay for the same services. Some contend that providers merely shift Medicare and Medicaid’s unpaid charges to private insurers, but that charge has been refuted. Rather, it is plausible that these payments appropriately help to squeeze out the one-third of health care expenditures that many experts view as sheer waste.

Americans generally like both private insurance and Medicare but universally hate their costs. “Medicare for All” eliminates private insurers and increases taxpayers’ burden. The public option keeps private insurers and controls health care costs.

Benjamin Sommers, MD, PhD, is the Huntley Quelch professor of health care economics at Harvard University T.H. Chan School of Public Health.

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COUNTER by David Himmelstein, M.D.

No.

A public option insurer that doesn’t try to dodge unprofitable enrollees like traditional Medicare does would be saddled with more than its share of sick, expensive patients and would become a de facto high-cost, high-risk pool. Although a public option really can’t achieve universal coverage, a single-payer system, usually referred to as Medicare for All, can.

CMS’s decades-long efforts to level the playing field have not worked against private insurers, which breaks their promises of fair competition. Insurance companies have also used their political muscle to sustain and increase their competitive advantage over traditional Medicare. The result is that a public plan and the taxpayers absorb the losses while private insurers skim off profits. This imbalance is so big that private plans can outcompete a public plan despite squandering vast sums on overhead costs, CEO salaries and shareholder profits.

The bottom line is that a public option is a more expensive way to do this than a single-payer system.

Private insurers currently take in $252 billion more than they pay out per year, which is equivalent to 12% of their premiums. A single-payer system with overhead costs comparable to Medicare’s could save about $220 billion of that money. A public option would save far less, or possibly nothing, if much of the new public coverage is channeled through Medicare Advantage plans, whose overhead, at 13.7%, is even higher than the average commercial insurer.

A single-payer system would put private insurance companies out of business. Drug companies and medical suppliers would also stand to lose billions because they would face a buyer that could actually drive down costs.

The excess overhead inherent to multipayer systems imposes a hidden surcharge on the fees that doctors and hospitals must charge all patients — not just those covered by private insurance. All told, a public option reform would sacrifice about $350 billion annually of single payer’s potential savings on providers’ overhead costs, over and above the $220 billion in savings it could sacrifice annually on insurers’ overhead.

Finally, a public option would undermine the rational health planning that is key to the long-term savings under single payer. Each dollar that a hospital invests in new buildings or equipment increases its operating costs by 20 to 25 cents in every subsequent year. At present, hospitals that garner profits have the capital to expand money-making services and buy high-tech gadgets, whether they’re needed or not, while neglecting vital but unprofitable services.

I’m not sure what innovation people think is going to be stifled with a single-payer system. In fact, Medicare has been much more innovative than private insurers. Most scientific innovation has come from the NIH and other countries. The CT scan, for example, came from Great Britain. Most of the money drug companies and insurance make goes to their shareholders; an astonishingly low amount goes to innovation. We’d be much better taking the money from those profits and amping up funding to the NIH.

Because a public option would leave the current dysfunctional payment approach in place, it would sacrifice most of the savings available via single-payer reform. I’m not opposed to having a public option because it would give more people insurance, but I just think it’s a bad way to provide insurance in this country. The bottom line is that a public option would either cost much more or deliver much less than single payer.

David U. Himmelstein, MD, is a professor of health policy at City University of New York School of Public Health at Hunter College.

https://www.healio.com…

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Comment:

By Don McCanne, M.D.

This is one of those situations where it is better to answer the question they should have asked rather than the one that they actually asked.

A Medicare-like public option that benefits from government-administered pricing and that is subsidized by the government obviously would bring down costs for patients who are enrolled in the program when compared to private commercial plans that are not government subsidized. But what about all of the other patients who are not enrolled in the public option? Some have suggested that competition from a public option might cause private plans to reduce their premiums, but they would do so by reducing their own costs through benefit reductions, increases in patient cost-sharing, and perhaps moving to more restrictive provider panels, shifting more costs to the patients, so any net cost reduction would be negligible.

Compare adding a public option to our current expensive, administratively complex, highly dysfunctional health care financing system to replacing the system with a well designed single payer system – an improved Medicare for All. Not only would everyone be covered with a high-performance system, the average costs for patients, except for the very wealthy, would be less than the average costs we are paying now simply because the entire system would be funded through equitable, progressive taxes – that’s on top of the sharp reductions in profound administrative waste and the efficiency of public purchasing.

As David Himmelstein explains, the bottom line is that we would have a superior system that would be affordable for each of us if we enacted and implemented a single payer system. Even Benjamin Sommers says, “The only way to get everyone insured is through a single-payer system,” and “Medicare’s enormous scale confers genuine administrative and purchasing efficiencies.” It’s nice to see that these experts appear to agree even if the question superficially seemed to bring them to opposite yes or no conclusions.

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By Jacqueline Ellison, Paul Shafer, and Megan B. Cole
Health Affairs, November 2020

Abstract

With the rise in the share of privately insured patients covered by high-deductible health plans (HDHPs), understanding sociodemographic trends in the uptake of health savings accounts (HSAs) is increasingly important, as HSAs may help offset the higher up-front costs of care in HDHPs. We used nationally representative data from the National Health Interview Survey from the period 2007–18 to examine trends in HDHP enrollment and HSA participation among privately insured adults by income level and race/ethnicity. Our findings show a substantial increase in HDHP enrollment across all racial/ethnic and income groups from 2007 to 2018. However, Black, Hispanic, and low-income HDHP enrollees were significantly less likely than their White and higher-income counterparts to participate in HSAs, and these gaps increased over time. This means that the HDHP enrollees most likely to benefit from the potential financial protection of HSAs were the least likely to have them. If these trends persist, racial/ethnic and income-based disparities in cost-related barriers to care may widen.

From the Discussion

Increased HDHP enrollment across all income levels and racial/ethnic groups reflects the larger trend in employers’ HDHP plan offerings during the past decade, as employers have often shifted costs to workers and attempted to minimize premium growth by using high deductibles and offering less generous benefits. Although other studies have documented increasing rates of HDHP enrollment in aggregate, our findings show that these increases have occurred across all income and racial/ethnic groups over time. As these trends persist, low-income, Black, and Hispanic populations, who already experience financial and structural barriers to care, may disproportionately experience negative consequences of high cost sharing.

Lower HSA participation among low-income individuals and families may be a result of this population being less likely to have an employer that contributes funds annually to the HSA or because lower-income people have fewer resources to set aside for future health care expenses. Research has demonstrated that lower savings levels among Black and Hispanic workers are primarily a consequence of inequities in intergenerational wealth, education, and employment. Thus, our finding of lower HSA participation among Black and Hispanic HDHP enrollees is likely a result of the disproportionate structural burdens borne by these communities. Fewer opportunities and lower incomes, compounded by labor-market discrimination, contribute to the racial/ethnic wealth gap and subsequent ability to save, as well as to the likelihood of being in a job that contributes to an HSA. Thus, institutionalized racism, as opposed to individual choices or agency, is the likely driver of observed racial/ethnic disparities in HSA participation.

Lower HSA uptake among people earning below 200 percent of the federal poverty level ultimately means that the people most likely to benefit from HSAs are those least likely to have them. Research consistently demonstrates that even minor cost sharing can result in the delay or avoidance of essential care, adverse events, and emergency department visits among low-income and chronically ill patients.

https://www.healthaffairs.org…

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Comment:

By Don McCanne, M.D.

High-deductible health plans (HDHPs) are promoted as a means to make patients more prudent shoppers of health care by making them responsible for upfront costs. But it has been well documented that these out-of-pocket costs have caused patients to forgo beneficial health care that they should have. To counter this adverse consequence, health savings accounts (HSAs) have been promoted to cover the upfront expenses. The problem here is that too many people do not have HSAs, and, if they do, the accounts frequently remain unfunded.

This study confirms that increases in HDHP enrollment have occurred in all income and racial/ethnic groups, whereas “Black, Hispanic, and low-income HDHP enrollees were significantly less likely than their White and higher-income counterparts to participate in HSAs.”

The consequences are obvious. Since those who have the greatest need for HSAs are less likely to have them, it is more likely that they will be unable to afford essential upfront health care services and then suffer the adverse health and financial consequences as a result.

Thus this study confirms that HDHPs and HSAs are yet one more example of institutional racism since they have a disproportionate negative impact on Black, Hispanic, and low-income individuals.

We could make progress in countering institutional racism by enacting and implementing a well designed, single payer, improved Medicare for All. Maybe we don’t have to call active opponents of Medicare for All racists, but we could let them know that their position does support institutional racism. Hopefully enough of them would be sensitive enough to that issue that they might take a more serious look at Medicare for All.

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The same cannot be said for those more centrist lawmakers who continue to defend the nation’s increasingly unpopular for-profit healthcare system.

By Jon Queally
Common Dreams, November 7, 2020

Highlighting an interesting—and to many, instructive—electoral trend that others have spotted in the days since 2020 voting ended earlier this week, Congresswoman Alexandria Ocasio-Cortez on Saturday—just as jubilation spread nationwide among Democrats and progressives upon news that Joe Biden will be the next U.S. President—pointed out that every single congressional member this year who ran for reelection while supporting Medicare for All won (or was on their way to winning) their respective race.

The tweet emerged as many across the corporate media landscape, including pundits and former high-level Democratic officials like Rahm Emanuel, unabashedly pushed a narrative that progressives calling for policies like a single-payer universal healthcare system or the Green New Deal are somehow a hindrance to electoral success. Ocasio-Cortez was not standing for it.

As Common Dreams reported Friday, while corporate-friendly Democrats have continued to go to bat for the for-profit healthcare system that lavishes billions of dollars each year on insurance companies, for-profit hospitals, and pharmaceutical giants, a new poll this week—put out by Fox News no less—shows that 72% of all U.S. voters would prefer a “government-run healthcare plan.” And the poll is far from an outlier, with numerous surveys in recent years showing this trend.

https://www.commondreams.org…

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Amid Tears and Anger, House Democrats Promise ‘Deep Dive’ on Election Losses

By Luke Broadwater and Nicholas Fandos
The New York Times, November 5, 2020

Representative James E. Clyburn of South Carolina, the third-ranking Democrat, said the party needed to overcome racial animus in the electorate, and had to shy away from certain far-left policies that alienate key segments of voters if Democrats wanted to win a pair of Senate seats currently in play in Georgia.

“Those two seats offer us the opportunity to change the dynamics in the Senate, but we are going to have to win those seats to do it,” he said. He cautioned against running on “Medicare for all or defunding police or socialized medicine,” adding that if Democrats pursued such policies, “we’re not going to win.”

https://www.nytimes.com…

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Alexandria Ocasio-Cortez on Biden’s Win, House Losses, and What’s Next for the Left

By Astead W. Herndon
The New York Times, November 7, 2020

We finally have a fuller understanding of the results. What’s your macro takeaway?

Well, I think the central one is that we aren’t in a free fall to hell anymore. But whether we’re going to pick ourselves up or not is the lingering question. We paused this precipitous descent. And the question is if and how we will build ourselves back up.
We know that race is a problem, and avoiding it is not going to solve any electoral issues. We have to actively disarm the potent influence of racism at the polls.

But we also learned that progressive policies do not hurt candidates. Every single candidate that co-sponsored Medicare for All in a swing district kept their seat. We also know that co-sponsoring the Green New Deal was not a sinker. Mike Levin was an original co-sponsor of the legislation, and he kept his seat.

To your first point, Democrats lost seats in an election where they were expected to gain them. Is that what you are ascribing to racism and white supremacy at the polls?

I think it’s going to be really important how the party deals with this internally, and whether the party is going to be honest about doing a real post-mortem and actually digging into why they lost. Because before we even had any data yet in a lot of these races, there was already finger-pointing that this was progressives’ fault and that this was the fault of the Movement for Black Lives.

I’ve already started looking into the actual functioning of these campaigns. And the thing is, I’ve been unseating Democrats for two years. I have been defeating D.C.C.C.-run campaigns for two years. That’s how I got to Congress. That’s how we elected Ayanna Pressley. That’s how Jamaal Bowman won. That’s how Cori Bush won. And so we know about extreme vulnerabilities in how Democrats run campaigns.

Is there anything from Tuesday that surprised you? Or made you rethink your previously held views?

The leadership and elements of the party — frankly, people in some of the most important decision-making positions in the party — are becoming so blinded to this anti-activist sentiment that they are blinding themselves to the very assets that they offer.

I’ve been trying to help. Before the election, I offered to help every single swing district Democrat with their operation. And every single one of them, but five, refused my help. And all five of the vulnerable or swing district people that I helped secure victory or are on a path to secure victory. And every single one that rejected my help is losing. And now they’re blaming us for their loss.

So I need my colleagues to understand that we are not the enemy. And that their base is not the enemy. That the Movement for Black Lives is not the enemy, that Medicare for all is not the enemy. This isn’t even just about winning an argument. It’s that if they keep going after the wrong thing, I mean, they’re just setting up their own obsolescence.

https://www.nytimes.com…

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Comment:

By Don McCanne, M.D.

A turning point in the nomination process for the Democratic Party was when the centrists decided to bump Bernie Sanders and align behind Joe Biden, claiming that leftist socialist concepts such as Medicare for All would result in defeat for the Democratic Party. Joe Biden reinforced this by emphatically denouncing the Medicare for All concept even though it was very popular amongst members of the Democratic Party. The surge to the right was so effective that the centrists managed to keep Medicare for All out of the Democratic Party platform.

The Democrats expected a blue tide which would expand their control of the House and take over control of the Senate. They got neither, though certainty of the control of the Senate will have to wait for the two runoff elections in Georgia, both highly likely to go to the Republicans.

It is ironic that the centrists are now blaming the progressives for this political failure, when it appears that the candidates supporting Medicare for All and other progressive issues prevailed, whereas the losses were amongst the candidates who refused to support Medicare for All.

I live in Orange County, California – a traditionally politically conservative county – home of the John Birch Society, the Nixon Western White House, and the Lincoln Club. For the last half century our Congressmen, all males, have been Republicans, until the 2018 midterm election. At that time, an environmental attorney, Mike Levin, ran for the seat. Health care remained a top concern that President Trump was not adequately addressing. Levin ran on progressive issues, strongly supporting Medicare for All and even including mention of Physicians for a National Health Program in his campaign literature. (He is a neighbor of mine, and I did support him in the campaign, but he was not influenced so much by me but rather by his own innate sense of health care justice.)

Once in Congress, Levin became an original co-sponsor of Pramila Jayapal’s Medicare for All Act of 2019 – H.R. 1384. When he ran for re-election this year he still quietly supported Medicare for All, but his health care emphasis has been to support expanding access on an urgent basis because of COVID-19, by strengthening the Affordable Care Act. He also supports other progressive causes such as eliminating the nuclear waste at our decommissioned San Onofre Nuclear Plans, and, importantly, supporting the large number of veterans who live here near Camp Pendleton. So he did continue to support Medicare for All, and he was re-elected.

I should mention another Democratic congressman, Harley Rouda, who was also elected in the Orange County Democratic sweep in 2018. Once in Congress, he declined to cosponsor Jayapal’s Medicare for All bill. He lost his current bid for re-election to a controversial Republican who, as a member of the Orange County Board of Supervisors, opposed requiring face masks during the pandemic, amongst other controversial positions.

Conor Lamb, a moderate from Pennsylvania, said that people are not clamoring for single payer health insurance nor the Green New Deal, but he was re-elected by a very narrow margin (51 to 49), so he seems to be an exception in this election by having survived in spite of his failure to support Medicare for All.

Also of interest is that Democrat Donna Shalala, a former HHS Secretary, was also opposed to Medicare for All, and she lost her bid for re-election to the House.

The centrists have it wrong. Instead of blaming the progressives for disappointing results in the election, they should be joining the progressives and enlightened conservatives in support of single payer, improved Medicare for All. The election is over. They should get to work.

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