The Washington Post
June 23, 2002
By Warren A. Jones, President of the American Academy of Family Physicians

The mantra is “incremental steps” — not because incrementalism is the right approach but because it is viewed as the only politically viable one. All the evidence, however, says that it’s the wrong approach and that it won’t work.

Incrementalism won’t work, because the problems are systemic. Reducing the ranks of the uninsured by a million or 2 million is a short-term victory in human terms. But adding them into a broken health care system is a long-term strategy doomed to fail.

This system must be overhauled. Any successful plan will require that everyone be covered — so we can reduce the huge hidden cost we are all paying in emergency rooms, neonatal intensive care units and all the other places where the uninsured wind up getting care. Just because one attempt at comprehensive reform failed in the early 1990s is no reason to say it cannot be done. It must be done. It’s time for new approaches.

The Academy of Family Physicians has a plan to fundamentally restructure the system. It’s called Assuring Health Care Coverage for All, and it is based on three principles:
* Basic health care services and protection against catastrophic costs to be guaranteed to everyone.
* Health care to be funded through a national, broad-based taxing mechanism. Everyone benefits, and everyone shares the expense.
* The current insurance market to be maintained, including employer-based and individually purchased insurance.

Americans know it’s time to act. Let’s get to the hard discussion about how to do so as quickly as possible. Our proposal is on the table. We are ready to debate the issue and work with others toward a solution.

http://www.washingtonpost.com/wp-dyn/articles/A26392-2002Jun21.html

Comment: The American Academy of Family Physicians has taken a giant step forward in expanding the national discourse on health care reform. AAFP recognizes that “politically viable” incremental steps fail to meet the goals of universality and equitable funding. They have placed on the table a proposal that mandates these goals. Although their proposal falls short on several other goals of reform, they are willing to debate and work with others on a solution.

The single payer model now has been firmly established as the most credible model of reform. Single payer needs to be on the table with the other proposals, but with representatives that refuse to compromise on issues of health care justice merely because an empirical decision is made to maintain the current insurance market. Fundamental ethical principles of health policy must provide the framework for the process. If those at the table sincerely believe that our resources must be directed to providing the best care possible for absolutely everyone, then the right decisions will be made.

The Washington Post

June 9, 2002
Associated Press

HERSHEY, Pa., June 8 — Members of Chocolate Workers Local 464 voted overwhelmingly today to approve a new contract with Hershey Foods Corp., ending the longest strike in the company’s history.

The main issue had been health care costs. Under the previous four-year contract, workers paid 6 percent of their health care costs, and the company wanted to increase the workers’ share to 12 percent over four years.

The agreement kept the workers’ share of health care costs at 6 percent in exchange for a smaller wage increase.

Bob Oakley, head negotiator of Chocolate Workers Local 464:

“The people were adamant about it.”

http://www.washingtonpost.com/wp-dyn/articles/A18413-2002Jun8.html

Comment: Hershey workers made a decision to pay more for continued health care security by using their own wages. This is an explicit example of the contention of most economists that health benefits provided by the employer are actually a part of the employee’s total compensation package. Employer-provided health benefit programs are funded by reductions in employee wages.

Health care costs continue to escalate because of the failure of our market approaches in containing costs. The Hershey experience makes it very clear who is paying these increased costs, and that is the individual employee.

Another lesson is that Americans do want to preserve comprehensive programs of health insurance in order to provide them with financial security in the event of significant medical expenses. That has always been the most important function of health insurance.

A common claim is that insurance is only for the purpose of insuring catastrophic loss, and that individuals should be responsible for “routine” expenses. Major acute or chronic disorders create “routine” expenses that are unaffordable for many moderate and low income individuals. Even very modest cost-sharing has been demonstrated to impair outcomes because of the financial barriers to care.

Chocolate Workers Local 464 has drawn the line on shifting risk to those who have the greatest health care needs. Let’s hope that the rest of the nation is inspired by their wise decision. Once this threat is quashed we should move forward with establishing a single national risk pool for everyone. A monopsonistic program of national health insurance would reduce health care inflation while assuring that our abundant health care resources would be effectively targeted to patient care. Then, finally, we would all have health care security that is affordable.

The New England Journal of Medicine
June 6, 2002

What’s Ahead for Health Insurance in the United States?

By Victor R. Fuchs, Ph.D., Stanford University

The announcement that most of the nation’s biggest insurers – Aetna, CIGNA, Humana, the United Health Group, and Wellpoint Health Network – will be introducing a new kind of health plan during the next year or two signals the beginning of a new era in health insurance in the United States. These plans feature a complicated menu of premiums, copayments, and deductibles that will add impetus to the trend of employers’ offering a defined contribution for health benefits. Each employee will get a fixed amount of money to spend as he or she sees fit and will use the Internet to “shop” for medical care. The plans will encourage the use of medical savings accounts in combination with catastrophic-illness insurance to cover expenditures that exceed a large deductible. One of their major effects will be to shift the burden of health care costs from employees who use little care to those who use more. Thus, the new plans will be another nail in the coffin of health insurance as a form of social insurance.

(Dr. Fuchs then discusses the erosion of social insurance, the advantages and disadvantages of the new plans, and the problems with reliance on catastrophic-illness insurance. He then closes with the following comments on the reemergence of social insurance.)

The case for the fairness of the social-insurance model will be strengthened as people realize that most health problems have, at least in part, a genetic basis. The case for the model’s efficiency will benefit from recognition that employment-based insurance has high administrative costs but provides no advantages to society as a whole. The desire to exert more direct control over increasing expenditures will provide an additional reason to introduce some form of national health insurance.

The timing of such a change, however, will depend largely on factors external to health care. Major changes in health policy are political acts undertaken for political purposes. The political nature of such changes was apparent when Bismarck introduced national health insurance to the new German state in the 19th century. It was apparent when England adopted national health insurance after World War II; and it will be apparent in the United States as well. National health insurance will probably come to the United States after a major change in the political climate – the kind of change that often accompanies a war, a depression, or large-scale civil unrest. Until then, the chief effect of the new plans will be to make young and healthy workers better off at the expense of their older, sicker colleagues.

(Note: The Quote of the Day messages will be suspended for two weeks while we travel. On returning, we’ll be back attempting to change the political climate without the necessity of experiencing war or a depression, although maybe it’s time for some good, old-fashioned civil unrest.)

NPR
June 5, 2002

“When asked more specifically to name the two most important health care issues for the government to address, access to health care and insurance issues (54 percent) received the most mentions. Large majorities favor a wide variety of options to guarantee health care for more Americans, including expanding state government programs for low-income people (84 percent), expanding neighborhood health clinics (80 percent), requiring businesses to offer insurance to employees (76 percent), and offering tax credits or other financial assistance to help the uninsured purchase insurance on their own (73 percent). The only option asked in this survey that was not favored by a majority is a national, single payer health plan (favored by 40 percent).”

http://www.npr.org/news/specials/healthcarepoll/index.html

The actual question asked in the survey:

13. I’m going to read you some different ways to guarantee health care for more Americans. As I read each one, please tell me whether you would favor it or oppose it. Do you favor or oppose (INSERT ITEM)?

a. A national health plan, financed by taxpayers, in which all Americans would get their insurance from a single government plan Favor 40 Oppose 55 Not sure 5

b. Requiring businesses to offer private health insurance for their employees Favor 76 Oppose 22 Not sure 2

c. Offering uninsured Americans income tax deductions, tax credits, or other financial assistance to help them purchase private health insurance on their own Favor 73 Oppose 24 Not sure 3

d. Expanding state government programs for low-income people, such as Medicaid and the Children’s Health Insurance Program, to provide coverage for people without health insurance Favor 84 Oppose 15 Not sure 1

e. Expanding neighborhood health clinics Favor 80 Oppose 15 Not sure 5

http://www.npr.org/news/specials/healthcarepoll/results.pdf

Comment: Once again, a major national poll has been widely reported as showing that Americans do not favor “a national, single payer health plan.” But, once again, the actual question asked included “taxpayers” and “government plan,” terms which many find difficult to endorse.

And once again, we can only speculate what the response would have been if the question had been, “Would you favor a single national insurance program that provided comprehensive benefits for everyone, with free choice of health care providers, and with administrative efficiencies that would protect us from cost increases?”

However, some important tentative conclusions can be extracted from the responses to this question:

** The respondents do support a variety of measures that would guarantee health care for more Americans.

** The respondents support employer mandates, although no questions were asked about the threat to the fiscal solvency of businesses, particularly small businesses.

** The respondents support tax policy that would assist with the purchase of individual health insurance in the private market. But it is important to note that no questions were asked to ascertain whether they understood that this approach would threaten the employment link to insurance and subject individuals to the higher premiums characteristic of the individual market as compared to group coverage.

** The respondents do support government programs for low-income individuals and neighborhood health clinics. No questions were asked to ascertain whether they perceived this to represent a lower tier of health care.

** The polls following the tragedy of 9/11 indicated that Americans have greater confidence in the government than previously. But the questions were related to providing security against the threat of terrorism. This poll indicates that this confidence in government does not extend to our health care system, except for the uninsured.

The policy issues are quite complex. Even relatively sophisticated individuals do not have the time to investigate the full implications of various health policies. Consequently, it is essential that health policy decisions should NOT be made based on these important polls of uninformed respondents.

Numerous studies have established the credibility of the single payer model. Yet most Americans have no understanding of the policy implications of single payer. To ask Americans if they want to pay taxes to have a government health plan is not asking a question about single payer reform. It is asking a rhetorical question about government interference and taxes. Maybe someday the pollsters will address the issues of equity, efficiency, universality, comprehensiveness, portability and other features of the single payer model. Until they do, we should not use their polls to determine the direction of national health policy.

NPR
June 5, 2002

“When asked more specifically to name the two most important health care issues for the government to address, access to health care and insurance issues (54 percent) received the most mentions. Large majorities favor a wide variety of options to guarantee health care for more Americans, including expanding state government programs for low-income people (84 percent), expanding neighborhood health clinics (80 percent), requiring businesses to offer insurance to employees (76 percent), and offering tax credits or other financial assistance to help the uninsured purchase insurance on their own (73 percent). The only option asked in this survey that was not favored by a majority is a national, single payer health plan (favored by 40 percent).”

http://www.npr.org/news/specials/healthcarepoll/index.html

The actual question asked in the survey:

13. I’m going to read you some different ways to guarantee health care for more Americans. As I read each one, please tell me whether you would favor it or oppose it. Do you favor or oppose (INSERT ITEM)?

a. A national health plan, financed by taxpayers, in which all Americans would get their insurance from a single government plan Favor 40 Oppose 55 Not sure 5

b. Requiring businesses to offer private health insurance for their employees Favor 76 Oppose 22 Not sure 2

c. Offering uninsured Americans income tax deductions, tax credits, or other financial assistance to help them purchase private health insurance on their own Favor 73 Oppose 24 Not sure 3

d. Expanding state government programs for low-income people, such as Medicaid and the Children’s Health Insurance Program, to provide coverage for people without health insurance Favor 84 Oppose 15 Not sure 1

e. Expanding neighborhood health clinics Favor 80 Oppose 15 Not sure 5

http://www.npr.org/news/specials/healthcarepoll/results.pdf

Comment: Once again, a major national poll has been widely reported as showing that Americans do not favor “a national, single payer health plan.” But, once again, the actual question asked included “taxpayers” and “government plan,” terms which many find difficult to endorse.

And once again, we can only speculate what the response would have been if the question had been, “Would you favor a single national insurance program that provided comprehensive benefits for everyone, with free choice of health care providers, and with administrative efficiencies that would protect us from cost increases?”

However, some important tentative conclusions can be extracted from the responses to this question:

** The respondents do support a variety of measures that would guarantee health care for more Americans.

** The respondents support employer mandates, although no questions were asked about the threat to the fiscal solvency of businesses, particularly small businesses.

** The respondents support tax policy that would assist with the purchase of individual health insurance in the private market. But it is important to note that no questions were asked to ascertain whether they understood that this approach would threaten the employment link to insurance and subject individuals to the higher premiums characteristic of the individual market as compared to group coverage.

** The respondents do support government programs for low-income individuals and neighborhood health clinics. No questions were asked to ascertain whether they perceived this to represent a lower tier of health care.

** The polls following the tragedy of 9/11 indicated that Americans have greater confidence in the government than previously. But the questions were related to providing security against the threat of terrorism. This poll indicates that this confidence in government does not extend to our health care system, except for the uninsured.

The policy issues are quite complex. Even relatively sophisticated individuals do not have the time to investigate the full implications of various health policies. Consequently, it is essential that health policy decisions should NOT be made based on these important polls of uninformed respondents.

Numerous studies have established the credibility of the single payer model. Yet most Americans have no understanding of the policy implications of single payer. To ask Americans if they want to pay taxes to have a government health plan is not asking a question about single payer reform. It is asking a rhetorical question about government interference and taxes. Maybe someday the pollsters will address the issues of equity, efficiency, universality, comprehensiveness, portability and other features of the single payer model. Until they do, we should not use their polls to determine the direction of national health policy.

My reply to DuPont is: What about Medicare? Is he willing to criticize Medicare (and commit political suicide) since it is a government program. Of course it does include choice. And is EMTALA un-American? It mandates (a classic unfunded mandate) that all emergency departments treat all comers without regard to ability to pay? As good Americans we already believe that many or most of us DO deserve coverage: the elderly, the emergencies, the poorest of the poor, the pregnant and babies, and as the patches in the quilt get smaller and smaller, the wonderfully inclusive programs covering dialysis and HIV care and the blind and many others. The people whom we discriminate against the most are young taxpayers who don’t have coverage from their work. That doesn’t sound very American to me. I believe universal coverage is true to the American Dream, even the conservative Republican dreams of Pete DuPont.

Consumer Reports
July, 2002

“New health-insurance policies that increase employees’ responsibility for costs could ultimately result in shrinking coverage for insured people. Instead of bringing people into one gigantic pool where the risk is spread evenly, market-driven policies further fragment the system. Just as the young, in effect, subsidize Social Security for the old, the healthy have traditionally subsidized health-insurance costs for the sick or injured so that no one is clobbered by huge bills. Consumers Union does not support replacing Social Security with self-directed savings accounts, nor does it support undermining health insurance with personal health accounts.”

“With no viable solutions in sight… ”

Comment: Personal health accounts are the insurance industry’s response to medical savings accounts. They will have appeal for the young and healthy who can watch their accounts grow, and they will be a disaster for those with significant medical needs who will rapidly spend down their accounts and be left with inadequate PPO or EPO catastrophic coverage.

Consumers Union recommends budgeting for health care expenses even if you think you have good insurance. Because insurance companies are shifting risk to the beneficiaries, any significant medical problem can leave you financially strapped.

Formerly, health insurance provided security that would allow you to build financial reserves for other needs such as supplementing Social Security at retirement. Now, the insurance industry is using your financial reserves to provide them with security against losses in the event that you would require health care. And for that non-service, we pay them close to a couple hundred billion dollars. Why do the incrementalists insist that we protect this industry, especially at the cost of perpetuating profoundly inhumane health care injustice?

Medical Economics
May 24, 2002
Memo from the Editor

By Marianne Dekker Mattera

At its Annual Session in Philadelphia last month, the American College of Physicians-American Society of Internal Medicine announced a plan that is supposed to ensure that all Americans have health insurance coverage within seven years.

According to ACP-ASIM incoming president, Sara Walker, the plan is meant to build on the health care system already in place in this country, not replace it with the sort of single-payer systems found elsewhere around the world.

I find it difficult to believe that the ACP-ASIM plan stands much of a chance.

Why? Because the organization hasn’t answered the hard questions. When asked who’s lined up in Congress to sponsor the plan, they had no answer. (In fact, at press time the plan hadn’t even been mentioned on the Hill yet.) When asked how much their plan is likely to cost, they had no answer.

Well, actually that’s not quite true. We were told that they deliberately didn’t do the calculations because they wanted to focus not so much on what insuring everyone would cost, but on what not insuring everyone would cost. Trouble, is, they didn’t have numbers for that either.

Frankly, without numbers no one in Congress is going to back this plan-or any plan. Especially not in an election year.

You can’t leave the really hard work-gathering the financing numbers that will make or break any health care reform measure-to someone else. I know I’m never anxious to champion a new proposal that means I have to do a lot of the legwork before I can take it any further. I can’t imagine even one member of Congress will be thrilled about doing that either.

I’d urge the ACP-ASIM to go back and do some of that legwork. They might also think about how they’re going to twist enough arms to get the measures through Congress once they convince someone to introduce it.

For the full editorial: http://www.memag.com/be_core/m/index.jsp, then, under “In this issue” click “More,” then click “Memo from the Editor: A question of access.”

Comment: The legwork on financing has been done. Numerous studies, the latest being the landmark California Health Care Options Project, have demonstrated that proposals such as that of ACP-ASIM which build on the current inequitable system will significantly increase costs. For California, that increase is about $3 billion per year. On the other hand, single payer models that would provide comprehensive services for everyone would save Californians about $7 billion per year. Merely multiplying those numbers by a factor of ten would provide a very reasonable estimate of the national financial implications of reform. Reform is not being stalled for the lack of numbers. We have those.

But what about the political legwork? A large minority in Congress personally support national health insurance. But since Americans are not clamoring for comprehensive reform, and many remain sensitive to the Clinton debacle on reform, most politicians are not willing to take a public stance that might risk a negative response from their constituency. The politicians may listen to the PACs, but they will not act on such a sensitive issue until they believe that they have the overwhelming support of the public.

Unfortunately, our citizens are still willing to reject affordable, comprehensive, high quality health care services for everyone, through a program of national health insurance, merely because of their infatuation with anti-government rhetoric. Like many other foolish infatuations, the consequence is a terrible price to pay.

May 28, 2002

A systematic review and meta-analysis of studies comparing mortality rates of private for-profit and private not-for-profit hospitals

By P.J. Devereaux, et al

Interpretation: Our meta-analysis suggests that private for-profit ownership of hospitals, in comparison with private not-for-profit ownership, results in a higher risk of death for patients.

Why is there an increase in mortality in for-profit institutions? Typically, investors expect a 10%-15% return on their investment. Administrative officers of private for-profit institutions receive rewards for achieving or exceeding the anticipated profit margin. In addition to generating profits, private for-profit institutions must pay taxes and may contend with cost pressures associated with large reimbursement packages for senior administrators that private not-for-profit institutions do not face. As a result, when dealing with populations in which reimbursement is similar (such as Medicare patients), private for-profit institutions face a daunting task. They must achieve the same outcomes as private not-for-profit institutions while devoting fewer resources to patient care.

Considering these issues one might feel concern that the profit motive of private for-profit hospitals may result in limitations of care that adversely affect patient outcomes. Our results suggest that this concern is justified. Studies included in our review that conducted an initial analysis adjusting for disease severity, and another analysis with further adjustment for staffing levels, support this explanation for our results. The private for-profit hospitals employed fewer highly skilled personnel per risk-adjusted bed. The number of highly skilled personnel per hospital bed is strongly associated with hospital mortality rates, and differences in mortality between private for-profit and private not-for-profit institutions predictably decreased when investigators adjusted for staffing levels. Therefore, lower staffing levels of highly skilled personnel are probably one factor responsible for the higher risk-adjusted mortality rates in private for-profit hospitals.

Given the differences in the organization of the Canadian and US health care systems, one might question whether our results can be applied to Canada. The structure of US health care has, however, shifted dramatically over time. With the exception of a single study, the results are remarkably consistent over time, suggesting that the adverse effect of private for-profit hospitals is manifest within a variety of health care contexts. Furthermore, whatever the context within which they function, for-profit care providers face the problem of holding down costs while delivering a profit. One would, therefore, expect the resulting problems in health care delivery to emerge whatever the setting. Finally, should Canada open its doors to private for-profit hospitals, it is the very same large US hospital chains that have generated the data included in this study that will soon be purchasing Canadian private for-profit hospitals. In summary, we think it plausible, indeed likely, that our results are generalizable to the Canadian context.

The Canadian health care system is at a crucial juncture with many individuals suggesting that we would be better served by private for-profit health care delivery. Our systematic review raises concerns about the potential negative health outcomes associated with private for-profit hospital care. Canadian policy-makers, the stakeholders who seek to influence them and the public whose health will be affected by their decisions should take this research evidence into account.

http://www.cmaj.ca/cgi/content/full/166/11/1399

Comment: Since it was “the very same large US hospital chains that have generated the data included in this study,” shouldn’t policy makers in the United States also take this research evidence into account?

Los Angeles Times
May 28, 2002
Letters to the Editor

Re “County Health System Faces Dire Options,” May 23:

Most Americans remain reluctant to support tax increases to assure access to health care for the uninsured or to replace their current coverage with a comprehensive program of public insurance.

The lack of funding for the uninsured has resulted in the drafting of plans that, at a minimum, would close the King/Drew trauma center. Even affluent auto accident victims are threatened by a system that causes them to bypass a locked-up trauma center as they are transported to an overcrowded facility through heavily congested city traffic. People will die no matter how much money they have.

The recent California Health and Human Services landmark study of health-care reform demonstrated that we already are spending enough to provide truly comprehensive care for absolutely everyone. But what we lack is a rational system to properly direct those funds.

Our current system of private health plans, government plans and no plans at all is egregiously wasteful of our resources. The study revealed that merely replacing this sick system with a single, more efficient program of universal health insurance would solve most of the problems in funding and access in health care without significantly increasing costs. Why aren’t we taking a serious look at this proposal?

Don McCanne MD

San Juan Capistrano